CHAPTER 1. Nonprofit Cooperative Associations [54001. - 54294.]

Chapter 1 enacted by Stats. 1967, Ch. 15.

§§ 54001–54294 · 77 sections

1. ARTICLE 1. Definitions §§ 54001–54004 · 4 sections

   • § 54001 Unless the context otherwise requires, the definitions in this article govern the construction of this chapter.
   • § 54002 “Association” means any corporation which is organized pursuant to this chapter. An association shall be deemed incorporated pursuant to this chapter, or…
   • § 54003 “Member” includes members of associations without capital stock and holders of common stock in associations which are organized with shares of stock.
   • § 54004 “Product” includes any horticultural, viticultural, aquacultural, forestry, dairy, livestock, poultry, bee, or farm product.
2. ARTICLE 2. General Provisions §§ 54031–54042 · 12 sections

   • § 54031 The purpose of this chapter is to do all of the following: (a) Promote, foster, and encourage the intelligent and orderly marketing of agricultural products…
   • § 54032 The following are all here recognized: (a) Agriculture is characterized by individual production in contrast to the group or factory system that characterizes…
   • § 54033 Associations which are organized pursuant to this chapter are “nonprofit,” since they are not organized to make profit for themselves, as such, or for their…
   • § 54034 Any provisions of law which are in conflict with this chapter do not apply to any association which is provided for in this chapter.
   • § 54035 Any exemption under any existing law which applies to any agricultural product in the possession, or under the control, of the individual producer, shall apply…
   • § 54036 A person, firm, corporation, or association, that is hereafter organized or doing business in this state, may not use the word “cooperative” as part of its…
   • § 54037 Any corporation or association which is organized pursuant to previously existing statutes for the purpose of cooperatively marketing products as defined in…
   • § 54038 Any association which is organized pursuant to this chapter is not any of the following: (a) A conspiracy, a combination in restraint of trade, or an illegal…
   • § 54039 The marketing contracts and agreements between an association which is organized pursuant to this chapter and its members and any agreements authorized in this…
   • § 54040 The General Corporation Law (Division 1 (commencing with Section 100) of Title 1 of the Corporations Code) as added by Chapter 682 of the Statutes of 1975 and…
   • § 54041 (a) Subject to subdivision (c), Chapter 7 (commencing with Section 1500) of Title 10 of Part 3 of the Code of Civil Procedure does not apply to any proprietary…
   • § 54042 (a) An association organized pursuant to this chapter may request the board of supervisors of the county in which the association’s principal place of business…
3. ARTICLE 3. Purposes § 54061 · 1 section

   • § 54061 Three or more natural persons, a majority of whom are residents of this state, who are engaged in the production of any product, may form an association…
4. ARTICLE 4. Articles of Incorporation §§ 54081–54083 · 3 sections

   • § 54081 The articles of incorporation of the association shall show that the signers of the articles of incorporation are engaged in the production of products, and…
   • § 54082 Articles of incorporation shall be signed, acknowledged, and filed in the manner which is prescribed by the general laws of this state for domestic…
   • § 54083 The articles of incorporation of any association may be amended in the manner and for the purposes which are authorized by the General Corporation Law,…
5. ARTICLE 5. Bylaws §§ 54111–54122 · 12 sections

   • § 54111 Each association shall, within 30 days after its incorporation, adopt for its government and management, a code of bylaws, not inconsistent with this chapter.…
   • § 54112 The bylaws may prescribe the time, place, and manner of calling and conducting its meetings. Meetings of members or stockholders shall be held at the place as…
   • § 54113 The bylaws may prescribe the number of stockholders or members which constitutes a quorum.
   • § 54114 The bylaws may prescribe the right of members or stockholders to vote by proxy or by mail or both, and the conditions, manner, form, and effects of such votes;…
   • § 54115 The bylaws may prescribe the number of directors which constitutes a quorum.
   • § 54116 (a) The bylaws may prescribe the qualifications, compensation, duties, and term of office of directors and officers and the time of their election. (b) The…
   • § 54117 The bylaws may prescribe penalties for violations of the bylaws.
   • § 54118 The bylaws may prescribe the amount of entrance, organization, and membership fees, if any; the manner and method of collection of such fees; and the purposes…
   • § 54119 The bylaws may prescribe the amount which each member or stockholder shall be required to pay annually, or from time to time, if at all, to carry on the…
   • § 54120 The bylaws may prescribe the amount of any dividends that may be declared on the stock or membership capital. To the extent that dividends are payable out of…
   • § 54121 The bylaws may prescribe the number and qualification of members or stockholders of the association and the conditions precedent to membership or ownership of…
   • § 54122 The bylaws may prescribe the manner of determining the value of a member’s interest and provision for its purchase by the association upon the death or…
6. ARTICLE 6. Directors and Management §§ 54141–54150 · 10 sections

   • § 54141 The affairs of the association shall be managed by a board of not less than three directors who are elected by the members or stockholders.
   • § 54142 The bylaws may provide that the territory in which the association has members shall be divided into districts and that directors shall be elected from the…
   • § 54143 The bylaws may provide that primary elections shall be held to nominate directors. If the bylaws provide that the territory in which the association has…
   • § 54144 The bylaws may provide that the territory in which the association has members shall be divided into districts, and that the directors shall be elected by…
   • § 54145 The bylaws may provide that one or more directors may be chosen by any public official or commission or by the other directors selected by the members. Such…
   • § 54146 The bylaws may provide for an executive committee and may allot to such committee all the functions and powers of the board of directors, subject to the…
   • § 54147 An association may provide a fair remuneration for the time which is actually spent by its officers and directors in its service and for the service of the…
   • § 54148 If a vacancy on the board of directors occurs except by expiration of term, the remaining members of the board, by a majority vote, shall fill the vacancy…
   • § 54149 The directors shall elect a president, one or more vice presidents, a secretary, a treasurer, and such other officers as may be prescribed by the bylaws. Any…
   • § 54150 Any member may bring charges against an officer or director by filing them in writing with the secretary of the association, together with a petition which is…
7. ARTICLE 7. Powers §§ 54171–54182 · 12 sections

   • § 54171 An association may engage in any activity in connection with the marketing, selling, preserving, harvesting, drying, processing, manufacturing, canning,…
   • § 54172 An association may borrow without limitation as to amount of corporate indebtedness or liability and may make advances to members.
   • § 54173 An association may act as the agent or representative of any member or members in any of the activites which are mentioned in Section 54171 or 54172.
   • § 54174 An association may purchase or otherwise acquire, hold, own, and exercise all rights of ownership in, sell, transfer, pledge, or guarantee the payment of…
   • § 54175 An association may establish reserves and invest the funds of the reserves in bonds or in such other property as may be provided in the bylaws.
   • § 54176 An association may buy, hold, and exercise all privileges of ownership, over such real or personal property as may be necessary or convenient for the conduct…
   • § 54177 An association may levy assessments in the manner and in the amount as may be provided in its bylaws.
   • § 54178 An association may do each and every thing which is necessary, suitable, or proper for the accomplishment of any one of the purposes, or the attainment of any…
   • § 54179 An association may use or employ any of its facilities for any purpose, provided the proceeds which arise from such use and employment shall go to reduce the…
   • § 54180 An association may organize, form, operate, own, control, have an interest in, own stock of, or be a member of any other corporation, with or without capital…
   • § 54181 Any association may, upon resolution adopted by its board of directors, enter into all necessary and proper contracts and agreements and make all necessary and…
   • § 54182 (a) Any association organized and operating pursuant to this chapter or pursuant to similar laws of any other state, the District of Columbia, or the United…
8. ARTICLE 8. Financial Provisions §§ 54201–54204 · 4 sections

   • § 54201 An association is not subject in any manner to the terms of the Corporate Securities Law, Division 1 (commencing with Section 25000), Title 4 of the…
   • § 54202 If an association issues nonpar value stock, the issuance of such stock shall be governed by the terms of all general laws which cover the issuance of nonpar…
   • § 54203 If an association with preferred shares of stock purchases the stock or any property, or any interest in any property of any person, it may discharge the…
   • § 54204 The board of directors of every association shall cause to be sent to the members of the association not later than 120 days after the close of the fiscal or…
9. ARTICLE 9. Members §§ 54231–54239 · 9 sections

   • § 54231 Under the terms and conditions which are prescribed in the bylaws adopted by it, an association may admit as members or issue common stock to only such persons…
   • § 54232 If a member of a nonstock association is other than a natural person, such member may be represented by any individual, associate, officer, or manager or…
   • § 54233 Any association may become a member or stockholder of any other association.
   • § 54234 If a member of an association which is established without shares of stock has paid his membership fee in full, he shall receive a certificate of membership.
   • § 54235 An association shall not issue a certificate for stock to a member until it has been fully paid for. The promissory notes of the members may be accepted by the…
   • § 54236 An association, in its bylaws, may limit the amount of common stock which any member may own.
   • § 54237 The bylaws shall prohibit the transfer of the common stock or membership certificates of the associations to any person that is not qualified to be a…
   • § 54238 The association may, at any time, as specified in the bylaws, except when the debts of the association exceed 50 percent of its assets, buy in or purchase its…
   • § 54239 A member or stockholder is not liable for the debts of the association to an amount which exceeds the sum which remains unpaid on his membership fee or his…
10. ARTICLE 10. Marketing Contracts §§ 54261–54266 · 6 sections

    • § 54261 The association and its members may make and execute marketing contracts which require the members to sell, for any period of time, but not over 15 years, all…
    • § 54262 The contract may provide that the association may sell or resell any product that is delivered by its members, with or without taking title to that product,…
    • § 54263 Notwithstanding any provisions of the Civil Code, a contract which is entered into by a member or stockholder of an association which provides for the delivery…
    • § 54264 The bylaws or the marketing contract may fix, as liquidated damages, specific sums to be paid by the member or stockholder to the association upon the breach…
    • § 54265 If there is a breach or threatened breach of such marketing contract by a member, the association shall be entitled to an injunction to prevent the further…
    • § 54266 In any action upon such marketing agreements, it shall be conclusively presumed that a landowner or landlord or lessor is able to control the delivery of any…
11. ARTICLE 11. Reorganization of Corporations Organized Pursuant to Other Laws §§ 54291–54294 · 4 sections

    • § 54291 A corporation that is organized or existing pursuant to any law, except Part 12 (commencing with Section 14550) of Division 3 of Title 1 of the Corporations…
    • § 54292 Articles of incorporation shall be deemed to conform to this chapter within the meaning of Section 54291 in both of the following cases: (a) It is provided or…
    • § 54293 If the amended articles conform, as provided in Section 54292, provisions in the articles of incorporation that appeared in the original articles or some…
    • § 54294 This article applies retrospectively as well as prospectively, and may be availed of by a corporation regardless of the time of incorporation, whether prior or…