Sanchez

Plaintiffs sued defendant, a nonprofit agricultural cooperative association, for money due, declaratory relief and an accounting. Plaintiffs are expelled members of the association. The court entered judgment for plaintiffs, and defendant appeals.

The primary purpose of defendant agricultural association, as outlined in article I of its bylaws, was the processing, utilization and marketing of grain and grain sorghum crops produced by member-growers. Operating on a nonprofit basis, the association returned any net proceeds realized to its members.

Such cooperative associations find statutory authorization in Food and Agricultural Code section 54001 et seq. in order to, “(a) [promote ... the intelligent and orderly marketing of agricultural products through cooperation; (b) [eliminate speculation and waste; (c) [m]ake the distribution of agricultural products between producer and consumer as direct as can be efficiently done; [and] (d) [stabilize the marketing of agricultural products.” (§ 54031.)

Section 54111 of the code requires such associations to adopt a set of bylaws. If the association desires, the bylaws may prescribe an amount each member is required to…