Procedures as to Assignees of Financial Rights

  1. Law
  2. Tennessee Code
  3. Agriculture and Horticulture
  4. Tennessee Processing Cooperative Law
  5. Dissenter's Rights
  6. Procedures as to Assignees of Financial Rights

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When an assignment of some or all of the financial rights of a membership is in effect and a copy delivered to the cooperative prior to the time described in §43-38-807, then as to that membership interest §§43-38-801 —43-38-812 must be followed, subject to the following:

  1. All rights to be exercised and actions to be taken by a member under §§ 43-38-802 — 43-38-812 shall be taken by the member and not by any assignee of the member's financial rights. As between the cooperative and the assignees, the actions taken or omitted by the member bind the assignees;
  2. Instead of remitting a payment under § 43-38-807, the cooperative shall forward to the dissenter member:
    1. The materials described in § 43-38-807(b);
    2. An offer to pay the amount listed in the materials, with that amount to be allocated among and paid to the member and the assignees of financial rights according to the terms of the assignments reflected in the required records; and
    3. A statement of that allocation;
  3. If the dissenter member accepts the amount of the offer made under subdivision (2) but disputes the allocation, the dissenter shall promptly so notify the cooperative and promptly after notification bring an action to determine the proper allocation. The suit must be filed in the county in which the registered office of the cooperative is located. The suit must name as parties the member, the cooperative and all assignees of the members financial rights. Upon being served with the action, the cooperative shall promptly pay into the court the amount offered under subdivision (2) and shall then be dismissed from the action;
  4. If the dissenter considers the amount offered under subdivision (2) inadequate, the dissenter may decline the offer and demand payment under § 43-38-810. If the dissenter makes demand, §§ 43-38-811 and 43-38-812 apply, with the court having jurisdiction also to determine the correctness of the allocation; and
  5. If the member fails to take action under either subdivision (3) or (4), then:
    1. As to the cooperative, both the member and the assignees of the member's financial rights are limited to the amount and allocation offered under subdivision (2); and
    2. The cooperative discharges its obligation of payment by making payment according to the amount and allocation offered under subdivision (2).


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