Contracts as condition of membership - Title to products - Withdrawal of members - Filing of contracts - Fees - Termination certificate.

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A. 1. Members may be required to execute contracts as a condition of admission to the association, whereby the members agree to:

  • a.patronize the facilities created by the association,
  • b.sell all or a specified part of their products to or through, or
  • c.buy all or a specified part of their supplies from or through, the association or any facilities created by it.

2. If the members in the association contract a sale to or through the association the fact that for certain purposes the relation between the association and its members may be one of agency shall not prevent the passage from the member to the association of absolute and exclusive title to the products which are the subject matter of the contract. The title shall pass to the association upon delivery of the product or at any other specified time which may be expressly and distinctly agreed upon in the contract, subject to previously existing liens.

3. In the case of contracts with members who are natural persons, if the period of the contract exceeds three (3) years, the contracts executed thereunder shall specify a reasonable period in each year during which the member by giving to the association reasonable notice as may be prescribed in the contract may withdraw and be released from the obligations under the contract, subject to liability already incurred by the member as a member of the association.

4. In the absence of a provision for notice or withdrawal in the contract a member who is a natural person may withdraw at any time after three (3) years subject to liabilities already incurred.

B. 1. The association may cause the original of a contract or an authenticated copy of the contract to be filed in the office of the county clerk of the county in which the products described in the contract, or any part of the contract, are or will at some future time be situated. The contracts shall describe the property or services affected, the manner in which they are affected, and the time for which they are affected and shall state the names and residences of the parties to the contract.

2. The fees for filing the contracts shall be twenty-five cents ($0.25) for each contract, except that when an association files more than one contract in a county which are substantially the same except for the signature of one of the parties the filing fee shall be twenty-five cents ($0.25) for the first contract and five cents ($0.05) for each similar contract.

C. Whenever a contract terminates, the association shall on demand give to the member a certificate to that effect. The certificate may be filed with the county clerk. The county clerk shall be entitled to the same filing fees pursuant to this subsection as in the case of chattel mortgages.

Added by Laws 1937, p. 266, § 17. Amended by Laws 2001, c. 38, § 17, eff. Nov. 1, 2001. Renumbered from § 361p of this title by Laws 2001, c. 38, § 26, eff. Nov. 1, 2001.


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