§ 25-825. Voluntary liquidation; certificate of dissolution; liquidating trustees. Any association operating under the provisions of this act may be dissolved and its affairs wound up by the vote of two-thirds of the members present and represented by ballot at any regularly called meeting: Provided, The notice of such meeting shall contain a statement to the effect that the dissolution of the association shall be voted on, and a brief statement of the reasons why such dissolution is deemed advisable. Such notice shall also contain an alphabetical list of the members in good standing and provide a ballot for the election of three members as trustees to have charge of the liquidation of the affairs of the association. Should the vote cast decide in favor of the dissolution of the association the authority of the directors shall cease forthwith, and they shall turn over all books, records, real and personal property belonging to the association to the three members receiving the highest vote for trustees. The board of trustees so elected shall proceed to wind up the affairs of the association, realize upon its assets, pay its debts, and divide the remaining funds among the members in proportion to their interests therein as conclusively determined by the trustees. Upon completing the liquidation the trustees shall execute under oath a signed statement that the association has been dissolved and its affairs liquidated, which statement shall be forwarded to the corporation commissioner, together with the dissolution fee of $2. Upon receipt of such statement the corporation commissioner shall notify the county clerk of the county in which the association dissolved had its principal place of business that such association has been legally dissolved. (L. 1915, ch. 226, 8 27; L. 1917, ch. 411, § 13; Ô. L. § 6979; L. 1929, ch. 412, § 19.) § 25-826. General corporation laws; application.-Provisions of the general corporation laws of this State and all powers and rights thereunder shall apply to the associations organized hereunder, except where such provisions are in conflict with or inconsistent with such provisions of this act. (L. 1915, ch. 226, § 28; O. L. § 6980; L. 1929, ch. 412, § 20.) § 25-827. Constitutionality; 1 Partial invalidity. If any section or part of a section of this act shall for any reason be declared unconstitutional, such fact shall not affect the remainder of the act. 1915, ch. 226, § 29 ; O. L. § 6981.) (L. In a case involving breach of a marketing contract of a cooperative organized under an earlier form of the above statute, the question of constitutionality of the statute arose. The court observed, "As this statute operates generally upon all cooperative associations throughout the State, and not upon a part of them only, and confers upon all alike the right to exercise the same powers and to enjoy the same rights and privileges, and did not grant to any particular cooperative association any different rights or powers, nor impose any different liabilities from those granted to and imposed upon all others similarly situated, the statute is general and not special within the meaning of those words as used in the constitution ['special' laws being prohibited]. And as it is a general statute applying equally and uniformly to all cooperative associations alike, the statute does not operate to create a monopoly as argued by defendant, nor is it violative * of section 20, article I of the constitution, which provides that 'No law shall be passed granting to any citizens or class of citizens, privileges or immunities which, upon the same terms, shall not equally belong to all citizens.' (Oregon Growers Cooperative Assn. v. Lentz, 107 Oreg. 561, 212 Pac. 811 (1923).) * * PENNSYLVANIA Purdon's Pennsylvania Statutes, 1936, Title 14, Chapter 1 § 1. Incorporation of cooperative associations.1-Cooperative associations, productive and distributive, may be incorporated under this act, upon compliance with its requirements, by any five or more farmers, mechanics, laborers, or other persons, who shall have associated themselves together by written articles of association, such as are hereinafter described, for the purpose of carrying on any agricultural, horticultural, mining, quarrying, building, mechanical, manufacturing or commercial, or for the purpose of manufacturing, cultivating, raising, trading, or dealing in all kinds of goods, wares, merchandise, chattels, grains, vegetables, roots, fruits, and other produce, or animals for sale, food, or other purposes, or for the purpose of buying, selling, holding, leasing, or improving lands, tenements or buildings; and that such persons, so associating, may adopt any corporate name, indicating their cooperative character, and which has not been previously adopted by any other corporation, formed under this act: Provided, That the two last words of such name shall be "cooperative association", and that it shall not be lawful to use, in such name, either the words "society" or "company", and that any violation of this proviso by any corporation, formed under this act, shall render each member thereof personally liable for all its debts. (P. L. 1887, No. 365, § 1.) 1 The cooperative statute of 1887 was held constitutional by the Federal District Court of Pennsylvania on the grounds that the act does not come within the forbidden category of "local" or "special" laws "since its provisions apply anywhere and to any of the class created, excluding none." (In re Wyoming Valley Coop. Ass'n., 198 Fed. 436 (D. Ct. Penn., 1912).) § 2. Filing of articles of association.-Before any association formed under this act shall commence its business, its articles of association shall be filed and recorded in the office of the secretary of state of this State, and two copies of the said articles shall be made, which the said secretary of state shall certify by his official signature and the seal of this State as being correct copies of said articles so filed and recorded, one of said certified copies shall be filed and recorded in the office of the recorder of deeds of the county in which the principal office of the association shall be located, and the said recorder of deeds shall certify by his official signature and the sea! of his office that the said certified copy of said articles has been filed and recorded in his office, and the other certified copy of said articles shall be held by the association named therein and the said articles or copies thereof duly certified by either of the aforesaid officers may be used as evidence in all courts and places of the incorporation of as well as for or against such association; and the said secretary of state and the said recorder of deeds shall each be paid for said filing, recording and certifying, at the rate of 10 cents for each 100 words contained in said articles; and after such articles of association shall have been made, filed, and recorded, as herein required, the persons signing the same, and such other persons, partnership, or corporation, who shall, from time to time, own and possess any share or shares in the stock capital of such association, and their several successors and assigns, shall be deemed and taken to be a body corporate and politic, by the name and for the purpose mentioned in such articles of association. (P. L. 1887, No. 365, § 2.) § 3. Subscribing and acknowledgment of articles; contents.-The articles of association shall be signed by the persons originally associating themselves together, and shall be acknowledged by at least five of them, before a notary public, and shall state distinctly: I. The name by which such association shall be known. II. The place in this State where its principal office is to be located. III. The purpose or object for which it is formed. IV. Whether its stock capital is fixed, and if so, what amount, or whether such capital is to be of an amount varying, from time to time, as the business may require. V. The amount of each share of permanent stock and ordinary stock of such capital, and how such shares may be paid for. VI. The amount of capital that will be actually paid in before commencing business. VII. The terms on which persons may become members. VIII. On what days in January, April, July, and October, regular or quarterly meetings of the members are to be held. IX. Such other matters, not repugnant to this act, as may be deemed proper and necessary. X. The term of its existence, not to exceed 30 years, and XI. The names of the first associates, their respective residences, and the number and class of shares held by each of them. (P. L. 1887, No. 365, § 3.) § 4. Capital stock. The stock capital of any such association shall consist of the amounts standing to the credit of members on account of the shares allotted to them, certificates for which shall be issued, from time to time, as such shares may have become fully paid up; and there may be two classes of shares, one of which classes shall be styled and known as "permanent stock", which shall not be withdrawable, but may be transferred, subject to the bylaws of such association, and each member thereof shall take and hold at least one share of said permanent stock; and the other class of shares may be styled and known as "ordinary stock", which may be repaid, transferred, or withdrawn, in accordance with the bylaws of such association; and the shares of either class may be of amounts not less than $5 nor more than $25 each, and may be paid for in one sum, or by periodical installments, or by occasional subscriptions, or by the interest thereon, or by profit dividends. (P. L. 1887, No. 365, § 4.) § 5. Statement of invested capital stock; 1 posting in principal office. It shall be the duty of any such association to exhibit in some conspicuous place, in its principal office, not later than 3 o'clock, post meridian, on the first business day of every month, and to continue the 1 same in such place until the next exhibit shall be thus made, a statement showing correctly and distinctly the amount of such invested stock capital, and what proportion such stock capital bears to such loans or deposits, such statement to be made up to the close of the next preceding month, and to be signed by the president and treasurer, or by any two of the directors, and to be attested by the secretary and auditors of such association, and if any of such officers as aforesaid shall wilfully make or knowingly consent to any false statement in such exhibit, he shall, by so doing, be deemed to have committed a misdemeanor, and shall, upon conviction thereof, be punished as provided in section 13 of this act: Provided, Any member or other person having an interest in the funds of such association, or any person legally authorized to assess property for taxes, may inspect its books and accounts during the official business hours, but no such member, person, or assessor, unless he be an officer of such association, or be specially authorized by a resolution thereof, shall have the right to inspect the share or other account of any other member or person without his written consent. (P. L. 1887, No. 365, § 5.) 1 § 6. Limitation of stock held by any one person; voting. The amount of stock capital of such association to be taken, held, or claimed at any one time by any person or persons, jointly or by partnerships, or by corporations, shall not exceed $1,000, except consent therefor be voted by the members, at any regular quarterly meeting thereof, nor shall any member, upon any subject at any meeting, be entitled to more than one vote, which shall be given in person and not by proxy, and any stock capital held by persons jointly or by partnerships, or by corporations, shall be voted upon as if held by one person only respectively, and subject to the bylaws of such association. (P. L. 1887, No. 365, § 6.) 1 1 See sections 4 and 7 of the State constitution. Section 4 provides: "In all elections for directors or managers of a corporation, each member or shareholder may cast the whole number of his votes for one candidate, or distribute them upon two or more candidates, as he may prefer." Section 7 provides: “No corporation shall issue stock or bonds except for money, labor done, or money or property actually received; and all fictitious increase of stock or indebtedness shall be void. The stock and indebtedness of corporations shall not be increased except in pursuance of general law, nor without the consent of the persons holding the larger amount in value of the stock, first obtained at a meeting to be held after 60 days' notice given in pursuance of law." § 7. Minors authorized to take and hold shares.—It shall be lawful, if the bylaws so provide, for any minor to take and hold shares in or to make loans or deposits of money to or with any such association, and for such association to pay to any minor any moneys that may be due to him in respect of any such shares, loans, or deposits standing in his name, and his receipt therefor shall be in all respects valid in law, but such minor shall not be eligible to hold any office in such association, though he may, subject to its bylaws, vote at any meeting of its members. (P. L. 1887, No. 365, § 7.) 1 § 8. Power to buy, sell, or trade. Any such association may buy from, sell to, or trade or deal with any of its members, or other per sons, partnerships, or corporations. (P. L. 1887, No. 365, § 8; P. L. 1929, No. 511, § 1.) 1 'An amendment to this section in 1929 eliminated the provision requiring cooperatives to conduct their business, with certain exceptions, on a cash basis. The omitted portion contained a clause forfeiting any credit extended in violation of the act. Cases which have interpreted this forfeiture-of-credit clause are: Tokar and Fedak v. Coop. Ass'n., 5 Wash. (Pa.) 128 (1920); Cavanna v. Tri-State Coop. Ass'n., 77 Pa. Super. Ct. 358 (1921): Weinman v. Coop. Ass'n., 3 Wash. (Pa.) 161, 71 Pitts. 701 (1922); In re Wyoming Valley Coop. Ass'n., 198 Fed. 436 (D. Ct., Penn., 1912). § 9. Individual liability of members; exemption of stocks from execution, etc. The members shall be severally and jointly liable for all debts for labor or other services of any kind performed for such association, and for any other debts lawfully incurred under the provisions of this act each of the members shall be liable to the amount of his unpaid stock capital and no more, but no suit shall be brought or any execution issued against any member individually until a judgment be first obtained for such labor, services, or any other lawful debts against such association, and execution thereon be returned unsatisfied in whole or in part; and in case any member shall be compelled to pay any such judgment, or any part thereof, beyond his pro rata liability therefor, he shall have the right to call upon all the members to pay their pro rata share of the same, or up to their pro rata liability therefor, and may sue them jointly or severally, or any number of them, and recover in such action the ratable amount due from the member or members so sued: And it is hereby Provided, That stock capital to the extent of $25 belonging to any member in such association, who is a householder and has a family, shall not be subject to attachment or execution, or liable in garnishment for his individual debts. (P. L. 1887, No. 365, § 9.) § 10. Corporate powers. Any such association may carry on its business or any part thereof at any one or more places within this State; and may take, hold, lease, and convey such personal and mixed estate as may be necessary for the purposes of its organization; and may sue and be (sued) in its corporate name, and may submit any matter in dispute to arbitration; and shall have a common seal, which shall not be altered or imitated, and shall bear the corporate name of, together with such device or motto as may be adopted by such association, and such seal shall be impressed upon the articles of association; and any such association may, for all and every and any of the purposes of its organization and for every and any other purpose incidental thereto, or in this act mentioned or referred to, lay out and use its capital or other moneys and property for the time being, or any part thereof, with power to do, authorize, and exercise all acts and powers whatsoever in the opinion of the directors of such association requisite or expedient to be done or exercised in relation thereto. (P. L. 1887, No. 365, § 10.) § 11. Investment of capital stock in other associations.-Any such association may, by a majority vote of its members at any meeting specially convened therefor, authorize the directors thereof to invest, in the name of such association, such an amount of its stock capital or reserve fund, and on such terms as such meetings shall determine, in the stock capital (of) any other duly incorporated cooperative |