Front Cover
 With capital stock: Chapter 14675--(No....
 Without capital stock: Chapter...
 General form for cooperative marketing...
 Back Cover

Group Title: Bulletin
Title: Chapter 14675--(No.37)
Full Citation
Permanent Link: http://ufdc.ufl.edu/UF00014604/00001
 Material Information
Title: Chapter 14675--(No.37) "An act to encourage the co-operative marketing of farm products and to authorize the incorporation of cooperative marketing associations"
Series Title: Bulletin
Physical Description: 30 p. : ; 22 cm.
Language: English
Creator: Florida -- Dept. of Agriculture
Publisher: Florida, Dept. of Agriculture
Place of Publication: Tallahassee Fla
Publication Date: 1949
Subject: Cooperative marketing of farm produce -- Law and legislation -- Florida   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
non-fiction   ( marcgt )
General Note: "July, 1949."
General Note: Title from cover.
General Note: "With capital stock, without capital stock".
 Record Information
Bibliographic ID: UF00014604
Volume ID: VID00001
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: ltqf - AAA7079
ltuf - AMT2910
oclc - 44576289
alephbibnum - 002566628

Table of Contents
    Front Cover
        Page 1
        Page 2
    With capital stock: Chapter 14675--(No. 37)
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
        Page 17
    Without capital stock: Chapter 5958--(No. 89)--Acts of 1909
        Page 18
        Page 19
        Page 20
        Page 21
    General form for cooperative marketing association
        Page 22
        Page 23
        Page 24
        Page 25
        Page 26
        Page 27
        Page 28
        Page 29
        Page 30
    Back Cover
        Page 31
        Page 32
Full Text

Bulletin No. 76

July, 1949








CHAPTER 14675--(No. 37)
"An Act to Encourage the Co-operative Mar-
keting of Farm Products and to Authorize
the Incorporation of Cooperative Marketing

NATHAN MAYO, Commissioner,

I 1 1 1;i1IiII-I ItI i1 11...... IiII!IIIIIII;fTIIIIIiIIIffIID M 1 J 1 H M I I




I~rDI -LdL-- C ~

_ - --

CHAPTER 14675-(No. 37)
AN ACT to Amend Chapter 9300, Acts of the Legislature
of 1923, Entitled "An Act to Encourage the Co-operative
Marketing of Farm Products and to Authorize the In-
corporation of Co-operative Marketing Associations."
Be It Enacted by the Legislature of the State of Florida:
Section 1. That Chapter 9300 of the Acts of the Legis-
lature of 1923, entitled "An Act to Encourage the Co-opera-
tive Marketing of Farm Products and to Authorize the In-
corporation of Co-operative Marketing Associations" be and
the same is hereby amended to read as follows.
Section 2. DECLARATION OF POLICY. In order to
promote, foster and encourage the intelligent and orderly
marketing of agricultural products through cooperation;
and to eliminate speculation and waste; and to make the
distribution of agricultural products between producer and
consumer as direct as can be efficiently done; and to
stabilize the marketing of agricultural products this Act
is passed."
Section 2. DEFINITIONS. As used in this Act.
(a) The term "Agricultural Products" shall include
horticultural, viticultural, forestry, dairy, live stock, poul-
try, bee and any farm products;
(b) The term "Member" shall include actual members
of associations without capital stock and holders of com-
mon stock in associations organized with capital stock;
(c) The term "Association" means any corporation
organized under this Act or any corporation formed under
any general or special Act of this or any other State as a
cooperative association, organized for the mutual benefit
of its members either as producers of agrciultural prod-
ucts or as non-profit cooperative organizations of produc-
ers of agricultural products, or both, and in which the re-
turn on the stock or membership capital is limited to an
amount not to exceed eight per centum (8%) per annum,
and in which during any fiscal year thereof the value of
business done with non-members shall not exceed the busi-
ness done with members during the same period.
(d) The term "person" shall include individuals, firms,
partnerships, corporations and associations.

(e) Associations organized hereunder shall be deemed
"non-profit" in as much as they are not organized to make
profit for themselves, as such, or for their members, as such,
but only for their members as producers.
(f) For the purpose of brevity and convenience this Act
may be indexed, referred to and cited as "The Agricultural
Co-operative Act."

Section 3. WHO MAY ORGANIZE. Three or more
persons engaged in the production of any agricultural prod-
ucts, or three or more associations, may form a non-profit
cooperative association under the provisions of this Act.

Section 4. PURPOSES. An Association may be organ-
ized under this Act for the purpose of engaging in any co-
operative activity in connection with the producing, mar-
keting or selling of agricultural products; or with the grow-
ing, harvesting, preserving, drying, processing, canning,
packing, grading, storing, warehousing, handling, shipping,
or utilizing such products; or the manufacturing or mar-
keting of the by-products thereof; or in connection with
any of the activities mentioned herein, the manufacturing,
selling or supplying of machinery, equipment or suppiles;
or in the financing of any of the above enumerated activi-
ties; or in performing or furnishing business or educational
services, on a cooperative basis for those engaged in agri-
culture as bona fide producers of agricultural products or in
any one or more of the activities specified herein.

group of persons contemplating the organization of an as-
sociation under this Act is urged to communicate with the
State Marketing Commissioner, who will inform it what-
ever a survey of the marketing conditions affecting the com-
modities to be handled by the proposed association indicates
regarding probable success.
Section 6. POWERS.-Except as the same may be lim-
ited in its articles of incorporation, each association organ-
ized under this Act shall have the following powers:
(a) To engage in any activity in connection with the
producing, marketing, selling, preserving, growing, harvest-
ing, drying, processing, manufacturing, canning, packing,
grading, warehousing, storing, handling or utilizing of agri-
cultural products or in the manufacturing or marketing of
the by-products; thereof; or in any activities in connection


with the manufacturing, purchasing, hiring or using sup-
plies, machinery or equipment; or in the financing of any
of the above enumerated activities, or in performing busi-
ness or educational services, on a cooperative basis, for
those engaged in agriculture as bona fide producers of
agricultural products; or in any one or more of the activi-
ties specified herein;
(b) To borrow money from any source without limita-
tion as to the amount of corporate indebtedness or liability,
with authority to give any kind or form of obligation or
security therefore.
(c) To act as the agent or representative of any person
or persons in any of the above mentioned activities;
(d) To make loans or advances to members and to their
members, to non-member patrons, and to non-member pa-
trons of members, with authority to accept therefore any
kind, form or type of obligation with or without security;
to purchase, endorse, discount, sell or guarantee the pay-
ment of any note, draft, bill of exchange, indenture, bill of
sale, mortgage or other obligation, the proceeds of which
have been advanced or used in the first instance for any of
the purposes provided for herein; to discount for or pur-
chase from any association organized under the laws of
any state, with or without its endorsement, any note, draft,
bill of exchange, indenture, bill of sale, mortgage or other
obligation the proceeds of which are advanced or used in
the first instance for carrying on any cooperative activity
authorized in this Act and with authority to dispose of
same with or without endorsement. An association organ-
ized under this Act and exercising any of the powers pro-
vided in this paragraph shall not engage in the business
of banking.
(e) To purchase or otherwise acquire, to hold, own and
exercise all rights of ownership in, and to sell, transfer,
pledge or guarantee the payment of dividends or interest
on, or the retirement or redemption of shares, of capital
stock, bonds or other obligations of any corporation or as-
sociation, engaged in any directly or indirectly related
activity, or in the producing, picking, hauling, packing,
shipping, handling, warehousing, financing, canning, pre-
serving, processing, manufacturing, utilizing, marketing, or
selling of any of the products handled by the association,
or any by-products thereof.
(f) To establish reserves and to invest the funds there-
of in bonds, or in such other property as may be provided
in the by-laws;

(g) To buy, hold and exercise all privileges of owner-
ship over such real or personal property, as may be nec-
essary or convenient for the conduct and operation of any
of the business of the association or incidental thereto:
(h) To sell, convey and transfer all of the assets of the
association; provided, such sale shall be consented to by not
less than two-thirds of its members or by the holders of
not less than two-thirds of its common stock, which con-
sent shall be given either in writing or by vote at a special
meeting of its members or stockholders called for that pur-
(i) To establish, secure, own and develop patents,
trademarks and copyrights;
(j) To do each and everything necessary, suitable or
proper for the accomplishment of any one of the purposes,
or the attainment of any one or more of the objects herein
enumerated, or conducive to or expedient for the interest
or benefit of the association, and to contract accordingly;
and in addition, to exercise and possess all powers, rights
and privileges necessary or incidental to the purposes for
which the association is organized or to the activities in
which it is engaged, and any other rights, powers and
privileges granted by the laws of this State to Corpora-
tions for profit, except such as are inconsistent with the
express provisions of this Act; and to do any such thing
(k) No association organized under this Act, during
any fiscal year thereof, shall deal in or handle products,
machinery, equipment, supplies and/or perform services
for and on behalf of non-members to an amount greater in
value than such as are dealt in handle and/or performed
by it for and on behalf of members during the same period.
Section 7. MEMBERS.--(a) Under the terms and con-
ditions prescribed in the by-laws adopted by it, an asso-
ciation may admit as members, or issue common stock only
to persons engaged in the production of agricultural prod-
ucts and to associations as herein defined.
(b) An association organized hereunder may become
a member or stockholder of any other association or cor-
association organized under this Act shall prepare and file
articles of incorporation setting forth:

(a) The name of the association, which may or may
not include the word cooperative or any abbreviation there-
(b) The purpose for which it is formed;
(c) To place where its principal office within the State
will be located;
(d) The term for which it is to exist, not exceeding
fifty (50) years;
(e) The names and addresses (not less than three), of
those who are to serve as directors for the first term or
until the election of their successors;
(f) If organized without capital stock, whether the
property rights and interest of each member shall be equal
or unequal; if unequal, the general rule or rules applicable
to all members by which the property rights and interest,
respectively, of each member may and shall be determined
and fixed; and provision for the admission of new mem-
bers, who shall be entitled to share in the property of the
association with the old members, in accordance with such
general rule or rules. This provision or paragraph of the
articles of incorporation shall not be altered, amended or
repealed, except by the written consent or vote of three-
fourths of the members;
(g) If organized with capital stock, the amount of such
stock and the number of shares into which the capital stock
is to be divided, whether all or part of the same shall have
a par value, and if so, the par value thereof, whether all
or part of the same shall have no par value, and if there is
to be more than one class of stock created, a description
of the different classes, the number of shares in each class,
and the relative rights, interest and preferences each class
shall represent;
(h) In addition to the foregoing, the articles of incor-
poration of any association incorporated hereunder may
contain any provision consistent with law with respect to
management, regulation, government, financing, indebted-
ness, membership, the establishment of voting districts and
the election of delegates for representative purposes, the
issuance, retirement and transfer of its stock, if formed
with capital stock or any provisions relative to the way or
manner in which it shall operate or with respect to its mem-
bers, officers or directors and any other provisions relating
to its affairs.
The articles shall be subscribed by the incorporators and
acknowledged by one of them, if individuals, or by the


president or any vice-president of one of them, if corpora-
tions, before an officer authorized by law to take and certify
acknowledgments of deeds and conveyances, and shall be
filed in the office of the Secretary of State accompanied by
a fee of ten dollars ($10.00) which shall be the only fee
required therefore, and thereupon the association shall be
and constitute a body corporate under the provisions of
this Act, and a copy of said articles of incorporation certi-
fied by the Secretary of State shall be received in all the
courts of this State and other places, as prima facie evi-
dence of the facts contained therein and of the due in-
corporation of such association.
PORATION.-The Articles of Incorporation may be al-
tered or amended at any regular meeting or any special
meeting called for the purpose. An amendment must first
be approved by two-thirds of the directors and then adopt-
ed by a vote representing a majority of a quorum of the
members attending a meeting of which notice of the pro-
posed amendment shall have been given. Thereupon the
association shall make under its corporate seal and the
hands of its president or vice-president and secretary or
assistant secretary, a certificate accordingly, and the presi-
dent or vice-president shall duly execute and acknowledge
such certificate before an officer authorized by law to take
and certify acknowledgments of deeds, and such certificate
so executed and acknowledged shall be filed in the office
of the Secretary of State; and upon so filing the same, the
articles of incorporation of such association shall be deemed
to be amended accordingly; provided, however, a fee of
only five dollars ($5.00) shall be required therefore by the
Secretary of State.
Section 10. BY-LAWS.--Each association incorporated
under this Act shall adopt for its government and manage-
ment, a code of By-Laws not inconsistent with the powers
granted by this Act. A majority vote of a quorum of the
members or stockholders attending a meeting, of which
notice of the proposed by-law or by-laws shall have been
given, is sufficient to adopt or amend the by-laws. Each
association, under its by-laws, may provide for any or
all of the following matters:
(a) The time, place and manner of calling and con-
ducting its meetings, which meetings and meetings of its.
directors, may be held either within or without the State.
(b) The number of stockholders or members constitut-
ing a quorum.

(c) The right of members or stockholders to vote by
proxy or by mail or both; and the conditions, manner, from
and effect of such votes.
(d) The number of directors constituting a quorum.
(e) The qualifications, compensation and duties and
term of office of directors and officers; time of their elec-
tion and the mode and manner of giving notice thereof.
(f) Penalties for violations of the by-laws.
(g) The amount of entrance, organization and mem-
bership fees, if any; the manner and method of collection
of the same; and the purposes for which they may be used.
(h) 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 business of the association; the
charge, if any, to be paid by each member or stockholder
for services rendered by the association to him and the
time of payment and the manner of collection; and the
form of marketing contract between the association and
its members or stockholders, which marketing contract
shall be binding upon every member or stockholder, unless
otherwise agreed upon in writing.
(i) The number and qualification of members or stock-
holders of the association and the conditions precedent to
membership or ownership of common stock; the method,
time, and manner of permitting members to withdraw or
the holders of common stock to transfer their stock; the
manner of assignment and transfer of the interest of mem-
bers and of the shares of common stock; the condition upon
which and time when membership of any member shall
cease; the automatic suspension of the rights of a member
when he ceases to be eligible to membership in the asso-
ciation; the mode, manner, and effect of the expulsion of
a member; whether a member upon withdrawal, death
or expulsion shall have any interest in the property of the
association, if organized without capital stock; the man-
ner of determining the value of the property interest or the
shares of common stock of retiring or expelled members,
which interest or stock may be conclusively appraised by
the board of directors of the association and purchased by
the association at such value within one year after the date
of such retirement or expulsion.
HOW CALLED.-In its by-laws each association shall pro-
vide for one or more regular meetings annually. The board
of directors shall have the right to call a special meeting at


any time, and ten percent of the members or stockholders
my file a petition stating the specific business to be brought
before the association and demand a special meeting at
any time. Such meeting must thereupon be called by the
directors. Notice of all special meetings, together with a
statement of the purpose thereof, shall be mailed to each
member at least ten days prior to the meeting; provided,
however, that the by-laws may require instead that such
notice may be given by publication in a newspaper of gen-
eral circulation, published at the principal place of busi-
ness of the association.
Section 12. DIRECTORS; ELECTION.-(a) The af-
fairs of the association shall be managed by a board of
not less than three directors, to be elected by the mem-
bers or stockholders, with such qualifications as may be
provided for in the articles of incorporation or the by-
laws. The by-laws may provide that the territory in which
the association has members shall be divided into districts
and that the directors shall be nominated according to such
district, either directly or by district delegates elected by
the members in that district. In such case the by-laws shall
specify the number of directors to be nominated by each
district, the manner and method of reapportioning the di-
rectors and of redistricting the territory covered by the as-
sociation. The by-laws may provide that primary elections
shall be held in each district to nominate the directors ap-
portioned to such districts and the result of all such pri-
mary elections may be ratified by the next regular meet-
ing of the association or may be considered final as to the
association. The by-laws may provide that one or more
directors may be nominated by the Commissioner of Agri-
culture or by the other directors nominated by the mem-
bers or their delegates. Such directors shall represent pri-
marily the interest of the general public in such associa-
tions. Such directors shall not number more than one-
third of the entire number of directors.
(b) An association may provide a fair remuneration
for the time actually spent by its officers and directors in
the service and for the service of the members of its execu-
tive committee. No director, during the term of his office,
shall be a party to a contract for profit with the associa-
tion differing in any way from the business relations ac-
corded regular members or holders of common stock of the
association or others, or differing from terms generally cur-
rent in that district.
(c) The by-laws may provide for an executive commit-


tee to be elected by the board of directors from within or
without the membership of the board and may allot to such
committee all the functions and powers of the board of di-
rectors, subject to the general direction and control of the
(d) When a vacancy on the board of directors occurs
other than by expiration of term, the remaining members
of the board, by a majority vote, shall fill the vacancy, un-
less the by-laws provide for the nomination of directors by
districts. In such case the board of directors shall call a
special meeting of the members or stockholders in the re-
spective district to nominate a person qualified to fill the
Section 13. ELECTION OF OFFICERS.-The directors
shall elect from their number a president and one or more
vice-presidents. They shall also elect a secretary, a treas-
urer, and such other officers as may be provided for in the
by-laws, none of whom need be directors or members of the
association. The office of secretary and treasurer may be
combined into one office designated as secretary-treasurer,
or both functions and titles may be united in one person.
The treasurer may be a bank or any depository, and as such,
shall not be considered as an officer, but as a function of
the board of directors, and in such case the secretary shall
perform the usual accounting duties of the treasurer ex-
cepting that the funds shall be deposited only as and where
authorized by the board of directors.
an association organized without capital stock has paid his
membership fee in full he shall receive a certificate of mem-
bership. An association may issue its shares of stock having
no par value from time to time for such consideration as
may be fixed by the board of directors. No association shall
issue stock until it has been fully paid for. Promissory notes
may be accepted by the association as full or partial pay-
ment for such stock. The association shall hold the stock
as security for the payment of the note; but such reten-
tion as security shall not affect the right of any stock-
holder to vote unless such notes are past due.
No member shall be liable for the debts of the associa-
tion to an amount exceeding the sum remaining unpaid on
his membership fee or his subscription to capital stock, in-
cluding any unpaid balance on any promissory notes given
in payment thereof.

No stockholder of an association organized hereunder,
except an association organized under this Act or an as-
sociation as defined in this Act, shall own more than one-
third of the outstanding common stock of the association;
and an association in its by-laws may limit the amount of
common stock which one member may own to an amount
less than one-third of the outstanding common stock. The
association shall limit its dividends on stock, both com-
mon and preferred to any amount not greater than eight
(8%) percentum per annum on the par value thereof, or
if such capital stock is without par value, then upon the
actual cash value of the consideration received by the asso-
ciation therefore. The association by the vote of its direc-
tors, may establish and accumulate reserves out of earn-
ings, including a permanent surplus fund as an addition to
capital. Net income in excess of additions to reserves and
surpluses so established, shall be distributed to the mem-
bers of the association on the basis of patronage. Any dis-
tribution of reserves and surpluses at any time shall be
made to members at the time such distribution is ordered
on the basis of patronage.
Any receipts or dividends from subsidiary corporations
or from stock or other securities owned by the association
shall be included in the ordinary receipts of the association.
No-member in any association without capital stock shall
be entitled to more than one vote; but the by-laws may
provide that such members or the holders of common stock
in an association with capital stock, may vote upon any or
all questions on a patronage basis.
Preferred stock may be sold to any person, member or
non-member and may be redeemable or retireable by the
association on such terms and conditions as may be pro-
vided for in the articles of incorporation, and printed on the
stock certificate. The by-laws, except as otherwise pro-
vided for in this Act, shall prohibit the transfer of the
common stock of the association to persons not engaged
in the production of agricultural products and such re-
strictions shall be printed upon every certificate of stock
subject thereto.
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 signed by ten per
cent of the members, requesting the removal of the officer
or director in question. The removal shall be voted upon


at the next regular aor special meeting of the association,
and by a vote of a majority of the members, the associa-
tion may remove the officer or director and fill the vacancy.
The director or officer against whom such charges have
been brought shall be informed in writing of the charges
previous to the meeting and shall have an opportunity at
the meeting to be heard in person or by counsel and to
present witnesses; and the person or persons bringing the
charges against him shall have the same opportunity.
In case the by-laws provide for election of directors by
districts with primary elections in each district then the
petition for removal of a director must be signed by twenty
per cent of the members residing in the district from which
he was elected. The board of directors must call a special
meeting of the members residing in that district to con-
sider the removal of the director. By a vote of the ma-
jority of the members of that district, the director shall be
removed from office.
Section 16. REFERENDUM. Upon demand of one-
third of the entire board of directors made immediately
and so recorded at the same meeting at which the original
motion was passed any matter that has been approved or
passed by the board must be referred to the entire mem-
bership or to the stockholders for decision at the next
special or regular meeting; provided, however, that a
special meeting may be called for the purpose.
Section 17. MARKETING CONTRACT.-The associa-
tion and its members may make and execute marketing
contracts requiring the members to sell, for any period of
time, all or any specified part of their agricultural products
or specified commodities exclusively to or through the asso-
ciation or any agencies designated by the association. The
contract may provide that the association may sell or resell
the products of its members with or without taking title
thereto; and pay to its members the resale price, after de-
ducting all necessary selling, overhead and other costs and
expenses, including interest or dividends on stock, not ex-
ceeding eight per cent per annum, and reserves for retiring
the stock, if any; and other proper reserved; and any other
proper deductions.
-(a) The by-laws and the marketing contract may fix,
as liquidated damages, specific sums to be paid by the
members or stockholders of the association upon the breach
by him of any provisions of the marketing contract regard-


ing the sale or delivery or withholding of products; and
may further provide that the member will pay all costs,
premiums for bonds, expenses and fees in case any action
is brought upon the contract by the association; and any
c.uch provisions shall be valid and enforceable in the courts
of this State.
(b) In the event of any such breach or threatened
breach of such marketing contract by a member, the asso-
ciation shall be entitled to an injunction to prevent the fur-
ther breach of the contract and to a decree of specific per-
formance thereof. Pending the adjudication of such an
action and upon filing a verified complaint showing the
breach or threatened breach, and upon filing a sufficient
bond, the association shall be entitled to a temporary re-
straining order and preliminary injunction against the
Any provisions of law which are in conflict with this Act
shall not be construed as applying to the associations here-
in provided for.
OPERATIVE".-No person, firm, corporation or associa-
tion, hereafter organized or doing business in this State,
shall be entitled to use the word "cooperative" as part of
its corporate or other business name or title unless it has
complied with the provisions of this Act.
Any person, firm, corporation or association now organ-
ized and existing or doing business in this State, and em-
bodying the word "cooperative" as part of its corporate
or other business name or title, and which is not organized
in compliance with the provisions of this Act, shall within
oix months from the date at which this Act goes into effect,
eliminate the word "cooperative" from its said corporate
or other business name or title.
OR ASSOCIATIONS.-An association may organize, form,
operate, own, control, have an interest in, own stock of, or
be a member of any other association or corporation, with
or without capital stock, and engaged in planting, growing,
producing, preserving, drying, processing, canning, pack-
ing, storing, warehousing, handling shipping, utilizing,
manufacturing, or selling of agricultural products, or by-
products thereof; or in performing business or educational
services; or in the financing of any of the above enumerated
If such corporations are warehousing corporations, they


may issue legal warehouse receipts to the associations
against the commodities delivered by. it, or to any other
person and such legal warehouse receipts shall be consid-
ered as adequate collateral to the extent of the usual and
current value of the commodity represented thereby. In
case such warehouse is licensed, or licensed and bonded
under the laws of this or any other state or the United
States, its warehouse receipt delivered to the association
on commodities of the association or its members, or de-
livered by the association or its members, shall not be
challenged or discriminated against because of ownership
or control wholly or in part, by the association.
OTHER ASSOCIATIONS.-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 proper stipulations, agreements and con-
tracts, and arrangements, with any other cooperative cor-
poration, association or associations, formed in this or any
other State, for the cooperative and more economical carry-
ing on of its business or any part or parts thereof. Any two
or more associations may, by agreement between them,
unite in employing and using or may separately employ and
use the same personnel, methods, means, and agencies for
carrying on and conducting their respective businesses.

Any corporation or association, organized under previously
existing statutes, may, by a majority vote of its stock-
holders or members, be brought under the provisions of
this Act by limiting its membership and adopting the other
restrictions as provided herein. It shall make out in dupli-
cate a statement signed and sworn to by its directors to the
effect that the corporation or association has, by a majority
vote of its stockholders or members, decided to accept the
benefits and be bound by the provisions of this Act and
has authorized all changes accordingly. Articles of in-
corporation shall be filed as required in Section 9 of this
Act, except that they shall be signed by the members of
the then board of directors. The filing fee shall be the same
as for filing an amendment to articles of incorporation.
TRADE.-No association as defined in this Act while en-
gaged in any of the activities specified herein shall be


deemed to be a conspiracy, or a combination in unlawful
restraint of trade, oi an illegal monopoly, or an attempt to
lessen competition or to fix prices arbitrarily; nor shall the
marketing contracts and agreements between the associa-
tion and its members, or any agreements authorized in this
Act, be considered illegal as such, or in unlawful restrain
of trade, or part of a conspiracy or combination to accom-
plish an improper or illegal purpose.
operative association with or without capital stock as de-
fined in this Act heretofore or hereafter organized under
the laws of another state shall be allowed to carry on any
proper activities, operations and functions in this State
upon the filing with the Secretary of State of a certified
copy of its articles of incorporation and the payment of a
filing fee of Ten Dollars ($10.00) in lieu of all franchise
or license or corporation taxes as required of associations
organized hereunder, and all contracts which could be
be made by any association organized hereunder, made by
or with such association shall be legal and valid and en-
forceable in this state with all of the remedies set forth in
this Act.
OF INCORPORATION.-The right of an association claim-
ing to be organized and incorporated and carrying on its
business under this Act to do and to continue its business,
may be inquired into by quo warrant at the suit of the
Attorney-General, but not otherwise.
Section 27. DISSOLUTION.-Any association incor-
porated under or adopting the provisions of this Act may
be dissolved and its affairs wound up voluntarily by a pe-
tition signed by two-thirds of the members or by the hold-
ers of two-thirds of the common stock, either in person or
by their agent, which petition shall be presented to the
Circuit Judge, who shall direct notice thereof to be pub-
lished for such time as he may judge expedient. After the
expiration of the time of such notice, the Circuit Judge may
decree a dissolution and make all necessary orders and de-
crees for the winding up of its affairs, including the appli-
cation of its assets toward the satisfaction of the claims
of creditors so far as may be and the distribution of any
moneys then remaining among its members in proportion
to their respective property interests.
: Any such association shall continue to be a body cor-


porate for a term of two years after the date of the decree
or dissolution for the purpose of prosecuting and defend-
ing suits and settling its affairs, and the president and di-
rectors at the time of its dissolution, and the survivors of
them, or such other person or persons as may be appointed
by the Circuit Judge, shall be trustees of such association
for that purpose during said term with full power in its
name to settle its affairs, collect all sums due it, sell and
convey its property, pay its debts as far as may be, and
distribute any moneys or property then remaining among
those entitled thereto.
Section 28. CONSTITUTIONALITY.-If any section of
this Act shall be declared unconstitutional for any reason,
the remainder of this Act shall not be effected thereby.
TION LAWS.-The provisions of the laws of this State
with respect to corporations for profit and all powers and
rights thereunder shall apply to associations organized
hereunder, except where such provisions are in conflict
with or inconsistent with the express provisions of this Act.
Laws or parts of laws in conflict with the provisions of this
Act are hereby repealed. Provided, however, that the pro-
visions of this Act shall not be construed to effect, limit or
in anywise interfere with the rights, powers or privileges
of any corporation or association which may have been
organized and which now exists, or of any corporation or
association which may be hereafter organized under Chap-
ter 5958 of the Acts of 1909 and amendments thereto.
Section 31. This Act shall take effect immediately upon
its passage and approved by the Governor or upon its be-
coming a law without such approval.
As amended to April 1, 1941.


CHAPTER 5958-(No. 89).-ACTS OF 1909
AN ACT for the Organization, Management and Co-opera-
tion of Agricultural (Citricultural) and Horticultural
Non-Profit Co-operative Associations.
Be It Enacted by the Legislature of the State of Florida:
Section 1. Three or more persons engaged in the pro-
duction, preserving, drying, packing, shipping or market-
ing of agricultural (viticultural) or horticultural products,
or (all) of them, may form a non-profit co-operative asso-
ciation, under the provisions of this Act,. to carry on said
business, and such association shall have, and may exer-
cise the powers authorized by this Act and the powers nec-
essarily incidental thereto, and all other powers granted
to private corporations by the laws of this State, except
such powers as are inconsistent with those granted by this
Section 2. Such associations shall not have a capital
stock, and its business shall not be carried on for profit.
Any person, or any number of persons, in addition to the
original incorporators, may become members of such as-
sociation, upon such terms and conditions as to member-
ship and subject to such rules and regulations as to their,
and each of their, contracts and other rights and liabilities
between it and the 'member, as the said association shall
provide in its by-laws. The association shall issue a certi-
ficate of membership to each member, but the said mem-
bership, or the said certificate thereof, shall not be assigned
by a member to any other person, nor shall the assigns
thereof be entitled to membership in the association or
to any property rights or interest therein. Nor shall a
purchaser at execution sale, or any other person who may
succeed, by operation of law or otherwise, to the property
interests of a member, be entitled to membership or be-
come a member of the association by virtue of such trans-
fer. The Board of Directors may, however, by motion duly
adopted by it, consent to such assignment or transfer and
to the acceptance of the assignee or transferee as a mem-
ber of the association, but the association shall have the
right, by its by-laws, to provide for or against the trans-
fer of membership and for or against the assignment of
membership certificates, and also the terms and condi-
tions upon which any such transfer or assignment shall be
Section 3. Each association formed under this Act must


prepare and file articles of incorporation in the same man-
ner and under the same regulations as now required by law
for the incorporation of companies for profit in this State
and therein shall set forth:
1. The name of the association.
2. The purpose for which it is formed.
3. The place where its principal business will be trans-
4. The term for which it is to exist, not exceeding fifty
5. The number of directors thereof, which must not be
less than three and which may be any number in excess
thereof, and the names and residences of those selected for
the first year and until their successors shall have been
elected and shall have accepted office.
6. Whether the voting power and the property rights
and interest of each member shall be equal or unequal, and
if unequal these articles shall set forth a general rule or
rules applicable to all members by which the voting power
and the property rights and interest, respectively, of each
member may and shall be determined and fixed, but the
association shall have the power to admit new members,
who shall be entitled to vote and to share in the property
of the association with the old members, in accordance
with such general rule. This provision of the articles of
incorporation shall not be altered, amended or repealed
except by the unanimous written consent of the vote of
all the members.
7. Said articles must be subscribed by the original mem-
bers and acknowledged by one of them before an officer
authorized by the law of this State to take and certify
acknowledgments of deeds of conveyance, and shall be
filed in accordance with the provisions of law, and when so
filed the said articles of incorporation or certified copies
thereof shall be received in all the courts of this State
and other places as prima facie evidence of the facts con-
tained therein.
Section 4. Each association incorporated under this Act
must, within thirty days after its incorporation, adopt a
code of by-laws for its government and management not
inconsistent with the provisions of this law. A majority vote
of the members or the written assent of members repre-
senting a majority of the votes is necessary to adopt such
by-laws. The provisions of the General Laws of this State
not inconsistent with the provisions of this Act shall apply


to the by-laws of the corporations provided for in this Act.
Each association may also, by its by-laws adopted as afore-
said, provide for the following matters:
1. The manner of removal of any one or more of its
directors, and for filling any and all vacancies in the Board
of Directors.
2. The number of directors and the number of mem-
bers or votes thereof constituting a quorum.
3. The conditions upon which, and the time when,
membership of any member in the association shall cease;
the mode, manner and effect of expulsion of a member,
subject to the right of the expelled member to have the
Board of Directors (equitably) appraise his property in-
terests in the association and to affix the amount thereof in
money, and to have the money paid to him within sixty
days after such expulsion.
4. The amount of membership fee, if any, and the
amount which each member shall be required to pay an-
nually, or from time to time, if at all, to carry on the busi-
ress of the association, and also the compensation, if any,
to be paid by each member for any services rendered by the
association to him, and the time of payment and the man-
ner of collecting the same and for forfeiture of the in-
terest of the member in the association for non-payment of
the same.
5. (The number and qualification of members of the
association and the conditions precedent to membership,
and the method, time and manner of permitting members
to withdraw, and providing for the assignment and trans-
fer of the interest of the member, and the manner of de-
termining the value of such interest, and providing for the
purchase of such interest by the association upon the death,
withdrawal or expulsion of a member or upon the forfeiture
of his membership, at the option of the association.)
6. Permitting members to vote by their proxies and de-
termining the conditions, manner, form and effect thereof.
Section 5. Each association incorporated under this Act
shall have the powers granted by the provisions of this law
and other laws of Florida relating to private corporations,
and shall also have the following powers:
1. To appoint such agents and officers as its business
may require, and such appointed agents may be either per-
sons or corporations; to admit persons to membership in the
association, and to expel any member pursuant to the pro-
visions by its by-laws; to forfeit the (membership) of any


member for violation of any agreement between him and
the association, or for his violation of its by-laws.
2. To purchase or otherwise acquire, hold, own, sell and
otherwise dispose of any and every kind or kinds of real
and personal property necessary to carry on its business
(and to acquire by purchase or otherwise the interest of
any member in the property of the association).
3. Upon the written assent or by a vote of members
representing two-thirds of the total votes of all members to
co-operate with any other (co-operative) corporation or
corporations for the co-operative and more economical
carrying on of their respective business by consolidation,
upon (resolution) adopted by its Board of Directors, to
enter into all necessary and proper contracts and agree-
ments, and to make all necessary and proper stipulations
and arrangement with any other (co-operative) corpora-
tion or corporations, for the co-operative and more economi-
cal carrying on of its business or any part or parts thereof;
or any two or more (co-operative) corporations organized
under this title, upon (resolutions) adopted by their re-
spective Board of Directors, may for the purpose of more
economically carrying on their respective business, by
agreement between them, unite in employing and using,
or several associations may separately employ and use,
the same methods, means and agencies for carrying on and
conducting their respective businesses.
4. Any association formed or consolidated under this
Act may be dissolved and its affairs wound up voluntarily
by the written request of members representing two-thirds
of the total votes, in the manner and with the effect now
provided by law, except that the moneys remaining after
liquidation shall be divided among the members in pro-
portion to their property interest therein.

Section 6. The right of an association claiming to be
organized and incorporated and carrying on its business
under this Act to do and to continue its business, may be
inquired into by quo warrant at'the suit of the Attorney
General, but not otherwise.

Section 7. This Act shall take effect immediately upon
its passage and approval by the Governor.


[This model is given by Mr. C. E. Bassett, Specialist in Cooperative
Organization, Office of Markets and Rural Organization of the U. S.
Department of Agriculture.]
This association shall be known as the (...........................
County Fruit Association) incorporated under the laws of
the State of ............. ................... Its place of business
shall be in the (City of................ ... .............) *
NOTE.-The name should indicate the territory covered and the
class of products handled. Thus, "The Maine Potato Shippers' Ex-
change," "The Richmond Egg Circle," etc. Practically every associa-
tion should be incorporated under the laws of the State where it is
The objects of this association shall be to encourage bet-
ter and more economical methods of production and dis-
tribution; to secure better results in grading, packing, mar-
keting, standardizing, and advertising our products; to
buy supplies in a cooperative way; to rent, buy, build, own,
sell and control such buildings and other real and personal

"All matter appearing in parenthesis is simply suggestive, and is
to be altered to suit the best interests of each Individual association .
property as may be needed in the business; to cultivate the
cooperative spirit in the community and to perform any
other work which may tend to the betterment of the mem-
bers and the uplift of the neighborhood.
NOTE.-Make the objects as definite as possible, but it is also
well to include a "blanket," which will cover any future efforts of the
All eligible and accepted members shall sign these rules,
and contribute their share share of capital stock or other
regular investment prescribed.
NOTE.-There may be conditions where it would be wise to limit
membership to those who have been recommended by the Directors
or who have received a two-thirds vote of the members present at any
meeting. It is doubtful if "chronic kickers" should ever be admitted.
The admission of merchants, bankers,- etc., is almost invaribly bad
policy, not because they are not good men but their membership is
incongruous in these associations.



1. The annual meeting of the association shall be held
on the............... ...............in each year. Notice of such
meeting shall be given each member in writing by the
Secretary, and by publication in the local paper if con-
venient less than (one week) previous to the date of
NOTE.-The annual meeting should be held as soon after the close
of the year's main business, as will allow for the settlement of all
accounts, auditing the books and the preparation of the annual re-
ports of the officers.
2. Special meetings may be called at any time by the
President. He shall call such meetings whenever................
members shall in writing so request. A notice of such
special meeting shall be sent to each member at least
(five) 5 days before the date of said meeting, which
notice shall give the nature of the business to be trans-
acted. A similar notice shall be given for all adjourned

(One-fifth) the members in good standing shall con-
stitute a quorum for the transaction of business at any

1. At each meeting a Board of..................Directors
shall be elected. A President, Vice-President, and Secre-
tary-Treasurer shall be chosen by the Directors from among
themselves at the first Board meeting after the annual
meeting. They shall also choose two auditors from the
members if available. All officers shall be elected by
ballot and shall perform the usual work of such officers.
(Four) Directors shall constitute a quorum at any Board
2. The Board shall employ a Business Manager, who
shall have charge of the business of the Association, un-
der the direction of the Board, who shall fix his compen-
NOTE.-In a large organization it would be well to unite the
Office Manager, Secretary and Treasurer in one person, as fre-
quent audits and counter signature of checks, vouchers, etc., would
serve as a sufficient check. The combining of these in one individual
centers all the office work and tends to greater efficiency.


3. All officers, who may handle any of the funds or
other property of the Association, shall give a surety bond
in excess of the funds which they are liable to handle at
any one time. The cost of such bonds shall be paid for
by the Association.

1. The capital stock of this association shall be
......divided into .............................. shares
of ........................ each. No member shall hold more than
(ten) per cent. of the outstanding stock of the association.
2. Transfers of shares shall only be made upon the
books of the association when the stockholder is clear from
all indebtedness to the association.
3. A stockholder, desiring to dispose of his shares, must
first offer them to the association, through the Board of Di-
rectors, at market value.
NOTE.-This provision, if desired, must be provided for in the
articles of incorporation, to make it legal. To allow outsiders to
purchase association stock might transfer the control of the organiza-
tion to those who are opposed to its continuance.
NOTE ON CAPITAL STOCK.-In case the business of an asso-
ciation is such as to only require a small amount of money and that
only for a short time during each year, it may not be necessary to have
any capital stock. Annual dues may be collected. The following plan
has in such cases worked well, where the local banks are prepared
and willing to make such loans. Where the plan is adopted the follow-
ing will take the place of the preceding section:

1. At the time of uniting with the association and at
the end of each three years after the incorporation of the
association, each member shall give a promissory note, pay-
able on demand to the association. This note shall be for
the sum of ($25.00) and an additional ($1.00) for each and
every acre of crops, to be marketed through the association,
then owned by the member. But in no case shall this note
be for a less sum than ($35.00). When a new note is
given, the old one shall be cancelled and returned to the
2. These notes shall be the property of the association
and shall be used by the Directors as collateral security
with which to borrow needed money for the association's
business. Whenever these notes are deposited as security


for a loan, all of the members shall individually share the
liability in proportion to the face value of their respective
3. Each member shall pay an annual membership fee
of $2.00 payable January 1.
4. The capital and credit thus obtained shall be used
as directed by the stockholders in regular or called session.

1. All goods produced for sale by the members shall
be delivered to the association as directed by the Manager,
in prime condition for grading, packing and shipping. All
grading and packing done on the grower's premises must
be in accordance with the rules of the association and sub-
ject to such inspection as may be established by the Direc-
2. All produce for shipment shall be inspected before
shipment, and if any produce is not of good quality and in
good condition for shipping, such produce shall be sorted
or otherwise prepared for shipment, at the expense of the
party to whom such produce belongs.
3. All brands, labels, trade marks, etc., shall be regis-
tered and become the property of the association and they
shall be only attached to such grades as shall be ordered
by the Board of Directors.

1. A member shall have the right to give away or re-
tain for his own use such of his farm products as he may
wish, but he shall not make sale of crops, promised to
the association, to any outside parties, except any product
not accepted by the association.
2. In case any member is offered a price in excess of
the price then obtainable by the association, said member
shall turn said bid over to the association for filling from
said member's goods.
NOTE.-Some such provisions is necessary, to prevent an outside
disgruntled dealer from making a false bid, to test a member's loyalty
and arouse dissension, with the idea of disrupting the organization.
Allowing the organization to handle this bid compels the mischief-
maker to "put up or shut up"; the grower gets the boosted price, if
the bidder does not back down, and the organization handles the deal
and so is strengthened rather than injured. One or two such ex-
periences has usually discouraged this very common form of outside


3. Each member shall have a number or mark, which
shall be permanently stamped on every sack, box, barrel,
crate, basket, or other package shipped by him through the
association. Any loss occasioned by improper packing or
grading shall be charged to the member whose mark is
found on said package.
NOTE.-Products packed on the grower's premises should be in-
spected as they are being packed, by an association inspector. He may
be employed and paid by the grower to assist in packing, but he
must be held accountable alone to the association for his inspection
work. His own private mark should be placed upon each package he
packed or inspected and should be held jointly responsible with the
grower for the pack, as it may be disclosed in the final market, ordi-
nary deterioration excepted.
4. Each member of the association shall have one vote
and only one; providing all claims and dues against said
member have been fully paid. No proxies shall be allowed.
NOTE.-In a stock company which is organized to earn profits
on the money invested in the business, a member votes in proportion
to the number of shares he holds. But the true cooperative associa-
tion is based on the individual member, a number of whom unite to
do something in which they have a common interest. In the fonrer
money rules; in the latter, men. While there may be cases where
the voting power of the members may be made in proportion to the
acreage of their products it will generally be found that any attempt
to vary the voting power of members will be unwise. The practice of
allowing a member to collect the proxies of absent members and vote
the same, possibly giving a single member the control of power, is too
dangerous a practice to be allowed.
In some of the largest non-profit cooperative associations, like the
California citrus fruit growers, it has been felt that it was neither
fair nor wise to demand that the large producing members should be
held to the same vote as a small producing member, when their re-
sponsibility and liability are so unequal. In such a case the voting
power of members can be made proportional to the amount of their
products or acreage handled through the association.
5. Any member may withdraw from the association at
any time between (the first day of December and the first
day of the following April) but all claims of whatsoever
nature must first be settled.
NOTE.-The time of withdrawal should be fixed so as to take
effect after the close of a season's business and before another sea-
son begins. To permit a member to withdraw during a busy marketing
season will result in confusion and may seriously handicap the manager
in filling his contracts.
6. Any member, feeling that he has a grievance or
cause for complaint, may appeal to the Board of Directors,
or to the members at any regularly called meeting. No
member shall be temporarily suspended or expelled from
the benefits of the association, without first being heard


in his own defense, either by the Board of Directors or
by the members at a regularly called meeting.

The manager shall employ and discharge all labor; he
shall secure information as to crop and market conditions
and furnish same to the members on request. He shall en-
courage the production of the best varieties of products
demanded by the trade. He shall conduct packing schools,
:n order that growers may become trained in the best
methods of grading, packing and labeling their products.
He shall enter into contracts for the sale of the association
goods. He shall have entire charge of the marketing of all
association goods, subject only to the action of the Board of
Directors and the by-laws and rules of the association.
NOTE.-The manager is the most important officer and his powers
must be limited as little as possible. He cannot be held responsible,
if he is to be dictated to at will by each member or the off cers are
to constantly meddle with his work. This does not imply that the
manager should be a dictator. He takes the suggestions of the
officers and members and from those of his own experiences, he con-
structs a business plan. Whenever a manager loses the confidence of
the members, he had best be replaced with a manager who possesses
that confidence.

1. The expenses of operating this association shall be
met by a percentage on returns for produce sold by the
association or by a fixed price per package, the amount of
such charge to be fixed by the Board of Directors.
He shall have charge of the grading, packing and inspec-
tion of all association products and shall have control of
the brands and labels and their use on the association pack-
ages in accordance with the rules of the association.
2. All merchandise purchased by the association for the
use of its members shall be paid for in cash by each mem-
ber on delivery.
NOTE.-Any system of extending credit requires large capital
and often results in considerable loss.
3. Payment for produce will be made to the shippers
on the receipt by the association of returns for the sale of
their produce, unless otherwise ordered by the full Board
of Directors. In making sales all produce of the same grade
shall be pooled and all shippers of the same grade shall
receive exactly the same price.


After the season's expenses are paid and the proper sum
set aside as a reserve for the depreciation of the associa-
tion property, the balance of the season's profits shall be
divided as follows:
1. The stockholders shall receive (six) per cent. per
annum on the par value of their stock.
2. One-half the balance shall be set aside as a surplus
fund, to increase the working capital or to finance future
improvements until the surplus shall amount to a sum equal
to the capital stock; by majority vote of the members it
may be made greater.
3. The balance shall be divided among the members,
in proportion to the value of their shipments and pur-
chases made through the association during that season.
Provided, that when any member has failed during thaL
season to live up to his agreements, by failing to ship ex-
clusively through the association, or by any other breach
of his contract, and provided further that said failure on
his part has resulted in a loss or damage to the associa-
tion, then said defaulting member shall forfeit to the as-
sociation such a share of his dividends then due as shall
reimburse said association for the loss or damages thus
sustained, in lieu of liquidated damages. Or the association
may proceed to collect from said defaulting member said
damages out of any other of his funds or property.
NOTE.-Some courts have held that to require a member to pay
his association a fee for the privilege of selling contracted produces
to an outside dealer is in restraint of trade, therefore, illegal. While it
may not be legal for an association to penalize its members, it may be
found that an association can legally provide, as in this last by-law,
to collect damages from a defaulting member, when losses or damages
have actually resulted from the failure of the member to live up
to his agreements. Some form of binding contract is essential to
hold the members of an association together. Many an organization
has failed because members were only bound by a gentleman's agree-
ment. A voluntary membership is totally inadequate for a stable and
long enduring organization. The laws of the state should be studied,
so that this by-law for holding the members may be legally drawn.
The books and business of the association shall be audited
monthly by the auditors selected from the membership. An
annual audit shall be made by a certified public accountant
previous to the date of the annual meeting, at which meet-
ing said report shall be presented in full. Special audits


shall be made upon order of the Board or upon a vote of the
members at any legally called meeting.
NOTE.-While small associations may not feel the need of such a
strict system of investigating the accounts, it will pay to have this
work done often and most thoroughly. If the association business is
being done carelessly, frequent audits will make it known and better
methods may be adopted before any great loss occurs. The cost of
an expert accountant is more than balanced by the confidence which
it gives the members and effectually stopping the criticism of fault
Below we give in definite form the difference between
the relaitonship that exists between the stockholders, the
employes, and the public when applied to the ordinary cor-
poration and that relationship when applied to the genuine-
ly cooperative corporation.

There are five fundamental characteristics of non-coop-
erative corporations:
1. Organized and operated for profit to the promoters
and stockholders.
2. Grant each share a vote, or limit all voting to a re-
stricted class of stockholders--such as Common Stock,
Voting Board or Board of Trust, etc.
3. Place no limit on number of shares an individual
or other corporation may own.
4. Place no restrictions on transfer of stock.
5. Distribute all net profits as dividends on capital
issued, whether the stock was paid for in cash-at par or
below par-in service or given away; or the profits may be

There are five fundamental principles of cooperative
1. Ownership of association by the producers of the
commodity handled, if agricultural.
2. Return on capital invested restricted to specified rate
of interest.
3. All net profits returned to members in proportion to
4. One member one vote regardless of the number of
shares owned.
5. Option must be given the Association on all shares


offered for sale and all transfers must be approved by the
There is a policy often pursued that gives the coopera-
tive concern an additional competing power but which is
not an essential requirement in cooperation: I refer to the
policy of retiring all outstanding stock from a sinking fund
provided from the profits, as the business will justify. The
California Fruit Growers' Exchange did this and many
other concerns following cooperative methods. This elimi-
nated all drain from the treasury for interest on money in-
invested, which is quite an item in old line business. Many
are organized without capital stock.


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