association all the cotton produced or acquired by or for him.” The court said

***to enable a grower to deliver to the association
cotton "acquired" by him the acquisition must be full
and complete, not only of the title, but of the right of
possession, as well, unhampered by any restrictions.
Until the grower attains that status, he has never
"acquired" the cotton, so as to enable him to comply
with his contract. To "acquire" cotton for delivery
means to acquire the legal right and power to make a
delivery, 105

The tenants from whom the grower had purchased the cotton had delivered it to warehouses and taken receipts for the cotton which they turned over to a bank. The bank then made loans on the cotton to the grower to enable him to make advances to the tenants. The court found that the grower had not acquired possession of the cotton inasmuch as the right to possession was in the bank from which the loans had been obtained, and therefore, the grower could not be compelled by specific performance to deliver this cotton.

In a Colorado case,106 apparently because of the form of marketing contract, the court held that the rights of the association with respect to the wool covered by the marketing contract were junior to those of third persons.

Assuming that a marketing contract is one of sale under which the title passes prior to the time when the products are delivered to the association, does the association receive such a title to the products that it is not possible for a dealer or other person "buying" the products after the making of the marketing contract to get title to them? If the products are seized by a creditor of the producer or if a person takes a chattel mortgage on them after the making of the marketing contract, are the rights of the association to the products superior to the rights of such creditors? In a majority of the States, an association involved in a situation like any of those described would apparently have title to the products so that the association could recover damages (or

105 Lennox v. Texas Farm Bureau Cotton Association, 16 S. W. 2d 413, 421 (Tex. Civ. App. 1929).

106 Colorado-New Mexico Wool Marketing Association v. Manning, 96 Colo. 186, 40 P. 2d 972 (1935).

the products) from any dealer who attempted to purchase them. The association would also appear to have similar rights with respect to any person who attempted to attach or seize the products as the products of the producer, or with respect to any person who was seeking to enforce a chattel mortgage on the products taken after their sale to the association.

In a California case, 107 raisins grown by a producer who had entered into a marketing contract with the Sun-Maid Raisin Growers of California were seized by the sheriff while they were in sweat boxes and before their delivery to the association, to satisfy a judgment which had been obtained by a creditor against the grower of the raisins. The Sun-Maid Raisin Growers of California then brought suit against the sheriff for the recovery of the raisins. The court held that title to the raisins was in the association at the time the sheriff seized them, and hence that the raisins could not be used to satisfy the claim which the creditor had against the grower. In determining that title had passed, the court emphasized the fact that the contract provided:

That the buyer (Sun-Maid Raisin Growers, a corpora-
tion) does hereby purchase and the seller (Betel) does
hereby sell all of the raisin grapes to be produced
during the years 1923 to 1937, inclusive. *** This
instrument is intended by the parties to pass to and vest
in the buyer a present title and right of possession to all
of the crops of raisin grapes covered hereby. The buyer
shall at all times have the right to enter upon said
premises and remove the said crops therefrom; but the
right of the buyer to so enter and remove said crops
shall not affect the obligation of the seller to pick, cure
and deliver the same as above provided.

The Court said:

Title passed when first the raisin grapes became
property which could be the subject of ownership and
sale. A potential existence of the grapes seems to

107 Sun-Maid Raisin Growers of California v. Jones, 96 Cal. App. 650, 274 P. 557, 558, 559, hearing denied by the State Supreme Court (1929); Merriman v. Martin, 113 Cal. App. 167, 298 P. 95 (1931). See also Texas Hay Association v. Angleton State Bank, 291 S. W. 846 (Tex. Com. App. 1927), reversing 285 S. W. 941 (1926).

answer this requirement. Arques v. Wasson. 108 This, of
course, was long before the attachment which was levied
upon a portion of the crop while in "sweat boxes"
undergoing the final curing process. When the grower's
creditor, therefore, attached the raisin grapes or the
raisins, whichever they were at the time of the levy, they
belonged to respondent.

When a cooperative took title to grapes on the vines and posted notice of purchase in the vineyard of the grower, it was held that the association could recover actual and exemplary damages from a corporation which, through its president, converted a portion of the grapes. The court also said that the claim that the association suffered no damage because it "intended to violate the state law by allowing the grapes to waste on the vines" clearly could not be relied upon by appellant.109

Under the optional-pool plan of handling cotton, a stipulation in the marketing contract of a cooperative under which a member had the option "to determine when the price of his cotton will be fixed" was held not to be in conflict with a provision in the marketing contract providing that title to the cotton should pass to the association on its delivery. 110

Even though title to commodities has passed to an association, this does not affect the obligation of the association to account to its members in accordance with the terms of the marketing contract. In this connection the following quotation from a Texas case is significant:

It being the clear intention of the members to create a
true cooperative marketing association, under the
powers enumerated by law and by the contracts, to per-
form certain services exclusively for its members, and to
hold in the face of this intention that the delivery of the
seed to the association was an absolute sale would
destroy it as a cooperative marketing association. The
members have conferred on this association, as their
selling agent, such title to the cottonseed with plenary

108 Arques v. Wasson, 51 Cal. 620, 21 Am. Rep. 718 (1877).

109 California Grape Control Board, Ltd. v. Boothe Fruit Company, 220 Cal. 279, 29 P. 2d 857, 858 (1934).

110 Burch v. South Carolina Cotton Growers' Co-op Association, 181 S.C. 295, 187 S.E. 422 (1936).

powers to handle and dispose of same, but the
association handles the proceeds thereof for the benefit
of itself and its members.!!!

At common law, and as declared to be the rule in some of the States, the sale of a commodity then capable of delivery, without its delivery to the buyer is either conclusive or presumptive evidence of fraud if, subsequent to the sale, third parties in good faith acquire rights in the commodity.112 This common law rule, however, is held to have little or no application in cases involving the sale of crops to be grown.113 This conclusion is apparently based upon the fact that a lawful contract may be made for the sale of crops to be grown14 and, as the crop is not then in existence, its delivery at the time of sale is manifestly impossible. 115

Many of the State statutes on this subject are so drawn that they have no application to the sale of growing crops or crops to be grown. For instance, in Sun-Maid Raisin Grower of California v. Jones, 116 it was urged that the sale of the raisins was void. because of the statute of California requiring the delivery of property sold. But the court pointed out that this statute only declares that transfers of property without the delivery thereof are void "if made by a person having at the time the possession or control of the property." Obviously, at the time the marketing contract covering the raisins was signed the grower did not have possession or control of the grapes which had not then been grown.

Notice is of importance in cases of this kind. For instance, under the Oregon Uniform Sales Act it was held that, when a dealer bought wool from a member of a cooperative which the member was obliged to deliver to the association under a marketing contract that on its face passed title to the wool to the

Texas Certified Cottonseed Breeders' Association v. Aldridge, 122 Tex. 464, 61 S. W. 2d 79, 83 (1933), reversing 59 S.W. 2d 320 (Tex. Civ. App. 1933). 11224 R.C.L. sec. 312.

113 Bellows v. Wells, 36 Vt. 599 (1864); McCarty v. Blevins, 13 Tenn. 195, 26 Am. Dec. 262 (1833); Hull v. Hull, 48 Conn. 250, 40 Am. Rep. 165 (1880); 24 R.C.L. sec. 315; Lieberman ỷ. Knight, 153 Tenn. 268, 283 S.W. 450 (1926).

14 Dickey v. Waldo, 97 Mich. 255, 56 N.W. 608, 23 L.R.A. 449 (1893). 1524 R.C.L. sec. 315; Bellows v. Wells, 36 Vt. 599 (1864).

11696 Cal. App. 650, 274 P. 557, hearing denied by the State Supreme Court (1929). See also Bloom v. Welsh, 27 N.J. Law 177 (1858); Flynt v. Conrad, 61 N.C. 190, 93 Am. Dec. 588 (1867); Cook v. Steel, 42 Tex. 53 (1875).

association, the dealer acquired good title to the wool inasmuch as the dealer did not have notice of the marketing contract.117

Some of the State statutes relative to the retention of possession of goods sold by the seller make the retention of such possession merely presumptive evidence of fraud as to third persons. In a Minnesta case, referring to such a statute, the court said:

It provides in express terms that such possession shall
be presumed to be fraudulent and void as against sub-
sequent purchasers in good faith, unless those claiming
under such sale make it appear that the sale was made
in good faith and without any intent to defraud such
purchasers. 118

In this case, a person purchased an automobile and allowed the car to continue in the possession of the seller, who subsequently borrowed money on the car, giving as security a chattel mortgage on the vehicle. The buyer of the automobile brought suit against the person who claimed it under the chattel mortgage and, as the court found that the buyer of the automobile had acted in good faith, the buyer won.

Either by reason of statutes or by decisions of the courts, many States have adopted the rule that the retention of possession of goods sold by the seller is only presumptive evidence of fraud as to third persons.119

In some States, the common law rule made the retention of the possession of goods sold void as to third persons. The rule, apparently, at common law had no application to growing crops

117 Pacific Wool Growers v. Draper & Co., 158 Ore. 1, 73 P. 2d 1391, 1393 (1937).

118 Wilson v. Walrath, 103 Minn. 412, 115 N. W. 203, 204, 24 L.R.A. (N.S.) 1127 (1908). See also Kimball v. Cash, 107 Misc. Rep. 363, 176 N.Y.S. 541 (1919); Godman v. Olson, 38 N.D. 360, 165 N.W. 515 (1917).

119 Shaul v. Harrington, 54 Ark. 305, 15 S. W. 835 (1891); Holliday v. McKinne, 22 Fla. 153 (1886); Osborn v. Ratliff, 53 lowa 748, 5 N. W. 746 (1880); Gardiner Bank v. Hodgdon, 14 Me. 453 (1837); Brooks v. Powers, 15 Mass. 244, 8 Am. Dec. 99 (1818); Johnston v. Dick, Hill & McLean, 27 Miss. 277 (1854); Rea v. Alexander, 27 N.C. 644 (1845); Hombeck v. Vanmetre, 9 Ohio 153 (1839); Benjamin v. Madden, 94 Va. 66, 26 S.E. 392 (1896); Poling v. Flanagan, 41 W. Va. 191, 23 S.E. 685 (1895); Fitzgerald v. Meyer, 25 Neb. 77, 41 N. W. 123 (1888); Williams v. Brown, 137 Mich. 569, 100 N. W. 786 (1904); Prentiss Tool & Supply Co. v. Schirmer, 136 N. Y. 305, 32 N. E. 849, 32 Am. St. Rep. 737 (1892); Patterson Co. v. People's Loan and Savings Co., 158 Ga. 503, 123 S.E. 704 (1924).