Title: King v. Farmers Electric Coop.

State: new-mexico

Issuer: New Mexico Supreme Court

Document:

246 P.2d 1041 (1952) 56 N.M. 552 KING v. FARMERS ELECTRIC COOP. INC. No. 5387. Supreme Court of New Mexico. July 30, 1952. Earl E. Hartley, Lynell G. Skarda, Clovis, for appellant. H.R. Parsons, Fort Sumner, Smith & Smith, Clovis, for appellee. LUJAN, Chief Justice. Fred C. King, hereinafter referred to as plaintiff, brought action in the District Court of De Baca County, against the Farmers Electric Cooperative, Inc., of New Mexico, hereinafter referred to as the Cooperative, to enjoin it from depriving him of electric service through its transmission line because of his refusal to grant it a right-of-way easement without compensation and restore electric service theretofore furnished him. The complaint alleges that it is a non-profit, cooperative, mutual organization organized under the provisions of Section 48-401 et seq., of the Statutes of New Mexico of 1941, as amended for the purpose of furnishing its members with electric energy for their use and operation and private and other consumption; that its main office is located in Clovis, New Mexico; that plaintiff became a member on February 14, 1948, and has continued to be such a member rightfully to the date *1042 of filing the complaint; that as such member he is entitled to all the rights, privileges and benefits incidental to and inuring to its members; that he has complied with all valid laws and regulations of cooperative; that he has performed all duties legally incumbent upon him and is ready, able and willing to continue compliance with said valid by-laws and regulations and to perform his legal duties flowing from his membership; that at the time of his becoming a member, the cooperative had and still has an electric power transmission line available to serve plaintiff at and upon Highway No. 60; that plaintiff had and still has his combined home and ranch headquarters near said transmission line; that being located as aforesaid plaintiff sought membership of the cooperative and the consequent electric power service which it was serving and still is serving members by means of said transmission line; that cooperative accepted the plaintiff as a member and began furnishing its electric service over said transmission line and has continued to so serve plaintiff until its wrongful discontinuance of such service; that cooperative has the only transmission line available to furnish plaintiff electricity; that cooperative has made charges for the electric service it has rendered to him and that plaintiff has promptly paid all charges and is ready, able and willing to promptly pay all such charges made in the future by the cooperative; that on June 6, 1950, cooperative without right or legal justification and contrary to the membership contractual rights of the plaintiff, willfully, recklessly, spitefully and maliciously discontinued its electric service; that despite plaintiff's protest and demand for the restoration of said service the cooperative still fails and refuses plaintiff the electric service it has heretofore furnished him; that on June 10, 1950, plaintiff made formal and written demand upon the cooperative for said restoration of electric service; that plaintiff has no plain, speedy or adequate remedy at law in the premises for the wrong thus done him by cooperative; that plaintiff has no remedy at law adequate to the restoration of his membership right; that electric service is not obtainable except through the use of cooperative's transmission of power over its line; that by cooperative's wrongful acts immediate and irreparable loss has been and is daily sustained by plaintiff; that by reason of the form and nature of cooperative's organization a contract exists between it and all its members; that it is obligated to make available to all its members in good standing all the electric service it is able to furnish; that cooperative has violated its obligation although the plaintiff has fully fulfilled his obligations arising under said contract and is ready, able and willing to do so in the future; and praying that cooperative be required to perform its contract with plaintiff; that cooperative be enjoined to restore its electric service to plaintiff; and that plaintiff have actual and exemplary damages. The lower court made and entered the following order: It is ordered, adjudged and directed, as follows: Thereafter, cooperative answered denying that it had wrongfully refused to continue service to plaintiff and further denying that plaintiff had fulfilled his contractual obligations to cooperative but affirmatively alleging that plaintiff violated his membership contract, was demanding electric service on a preferential basis, and that plaintiff had been legally expelled from *1043 membership in defendant and his electric service legally discontinued. The court found: We have carefully examined the record and find that there is substantial evidence to support findings numbered one to eight, inclusive. We reach a different conclusion as to the Court's finding of fact No. 9, as we find no substantial evidence to support the same, therefore, it cannot be sustained by us. On February 14, 1948, plaintiff voluntarily became a member of Cooperative and continued so up until June 6, 1950, when he was expelled as a member and his electric service was disconnected for his refusal to grant it a right-of-way for a high voltage transmission line over his property. He had theretofore complied with the rules, regulations and by-laws of Cooperative. Cooperative now serves nine hundred members in Fort Sumner and in the Pecos Valley and plans service for more than one hundred additional members in that county. It was stipulated that the present system, plant and generating facilities at Fort Sumner are inadequate and unreliable. In order to serve the De Baca County area properly, Cooperative proposed and set about procuring engineering, right-of-ways, and materials for a sixty-nine thousand volt line from Clovis to Fort Sumner. It was also stipulated that the building of the proposed line is necessary. A little over four miles of the proposed line traverses plaintiff's ranch. During the month of February, 1950, Cooperative began its survey for the new line. Mr. J.L. Coffey, County Commissioner of Curry County and a Mr. Gilbert contacted plaintiff relative to granting it a right-of-way for its transmission line over his ranch but plaintiff refused to grant the same unless he was paid for it. Several other attempts were made to have plaintiff grant said right-of-way, but without success. Thereafter, Cooperative took steps to expel plaintiff from membership pursuant to Section 7, Article 1, of its by-laws and the resolution passed pursuant thereto on July 26, 1947. Cooperative commenced its procedure by sending plaintiff a registered letter dated May 30, 1950, *1044 setting June 3, 1950 at 10 A.M. o'clock at Cooperative's office in Clovis, New Mexico, as the time and place to take final action on the question of termination of his membership. The plaintiff did not appear for the hearing. The Board of Trustees convened on the appointed date and adopted a motion to expel plaintiff from membership and to disconnect electric service to him as of June 6, 1950. Thereafter, Mr. Luther Hudson, one of the trustees went to plaintiff's home to give him a final opportunity to comply, but nothing came of it. Cooperative then expelled plaintiff from membership and disconnected his electric service. Section 48-408 of 1941 Compilation, provides: In accordance with the above section, a full set of by-laws was adopted by the board of trustees on January 27, 1940, included in which was Section 7, Article 1, as follows: On July 26, 1947, the board of trustees enacted the following resolution, which was duly adopted. At the time of issuing the membership certificate No. 3575 to the plaintiff, the provisions of the Cooperative by-laws relating to right-of-way easements had *1045 been enacted and in force. The plaintiff admits on one occasion that he made application for membership and on another occasion denies it. It is most likely that the plaintiff did sign an application blank as indicated by his letter of February 2, 1948, enclosing the membership fee which on the first mailing had been lost and apparently the application blank with it. The plaintiff having been accepted as a member of the Cooperative is not in any position to challenge the validity of its by-laws. Members of such organizations (as this) are presumed to know its charter and by-laws. This conclusion is well fortified by respectable authority: Clark v. Mutual Reserve Fund Life Ass'n, 14 App.D.C. 154, 43 L.R.A. 390; Americanized Finance Corporation v. Yarbrough, 223 Ala. 266, 135 So. 448; United Order of Golden Cross v. Hooser, 160 Ala. 334, 49 So. 354; Supreme Commandery Knights of Golden Rule v. Ainsworth, 71 Ala. 436, 46 Am.Rep. 332; Hobbs v. Iowa Mutual Benefit Ass'n, 82 Iowa 107, 47 N.W. 983, 11 L.R.A. 299; Shartle v. Modern Brotherhood of America, 139 Mo. App. 433, 122 S.W. 1139; Kocher v. Supreme Council Catholic Benevolent Legion, 65 N.J.L. 649, 48 A. 544, 52 L.R.A. 861; State ex rel. Webber v. Shaw, 103 Ohio St. 660, 134 N.E. 643; Home Forum Benefit Order v. Jones, 5 Okl. 598, 50 P. 165; Doehler v. Lansdon, 135 Or. 687, 291 P. 392, 298 P. 200; Sovereign Camp W.O.W. v. Bailey, Tex.Civ.App., 277 S.W. 782; Sterling v. Head Camp Pacific Jurisdiction, 28 Utah 526, 80 P. 1110; Wilson v. Union Mutual Life Insurance Co., 77 Vt. 28, 58 A. 799; Evans v. Southern Tier Masonic Relief Ass'n, 76 App.Div. 151, 78 N.Y.S. 611; Virginia Knights of Columbus v. Burrough's Beneficiary, 107 Va. 671, 60 S.E. 40, 17 L.R.A.,N.S., 246. The plaintiff agreed, if accepted as a member of the Cooperative, to abide by all its rules, regulations and by-laws. He was accepted on that condition and will not now be permitted to repudiate the same. The Cooperative is a non-profit corporation organized under the Rural Electric Cooperatives Act of New Mexico, Chapter 47, Session Laws of 1939, the same being Section 48-401 et seq., of New Mexico Statutes 1941 Annotated. This statute, together with the articles of incorporation and the by-laws of Cooperative, and the application made by the plaintiff, and the certificate of membership issued to him, constitute the contract between plaintiff and the Cooperative. The application for membership in Cooperative contained, among other things, the following agreement: "applicant hereby agrees that he will comply with and be bound by the provisions of the Charter and by-laws of the Cooperative, and such rules and regulations as may from time to time be adopted by the Cooperative." The question then arises as to whether plaintiff, in view of this provision in his application and certificate of membership, is bound by the by-laws, rules and regulations, reasonable in their nature, and properly adopted under an authority conferred by the statute under which the cooperative is organized prior to the time he became a member of the corporation. We have no doubt in our minds that under a great weight of authority a member of a mutual organization, who agrees in his application to be bound by its laws, will, when such by-laws are reasonable, and enacted under properly delegated authority, be bound thereby. The following cases support the views expressed above: Weatherly v. Medical & Surgical Society of Montgomery Co., 76 Ala. 567, McFadden v. Los Angeles County Board of Sup'rs, 74 Cal. 571, 16 P. 397; Model Land & Irrigation Co. v. Madsen, 87 Colo. 166, 285 P. 1100; Coughlin v. Knights of Columbus, 79 Conn. 218, 64 A. 223; People ex rel. Keefe v. Women's Catholic Order of Foresters, 162 Ill. 78, 80, 44 N.E. 401; Norton v. Catholic Order of Foresters, 138 Iowa 464, 114 N.W. 893, 24 L.R.A.,N.S., 1030; Miller v. National Knights of Ladies of Security, 69 Kan. 234, 76 P. 830; Daughtry v. Knights of Pythias, 48 La. Ann. 1203, 20 So. 712; Donnelly v. Supreme Council Catholic Benevolent Legion, 106 Md. 425, 67 A. 276; Reynolds v. Supreme Council of Royal Arcanum, 192 Mass. 150, 78 N.E. 129, 7 L.R.A.,N.S., 1154; Douville v. Farmers' Mutual Fire Insurance Co., 113 Mich. 158, 71 N.W. 517; Thibert v. Supreme Lodge Knights of Honor, 78 Minn. 448, 81 N.W. 220, 47 L.R.A. 136; Swett v. Antelope County Farmers' Mutual Insurance Co., 91 Neb. 561, 136 N.W. 347; *1046 J.P. Lamb & Co. v. Merchants' National Mutual Fire Insurance Co., 18 N.D. 253, 119 N.W. 1048; Supreme Ruling Fraternal Mystic Circle v. Ericson, Tex.Civ.App., 131 S.W. 92. This being true, according to the certificate of membership here, when read in connection with the by-laws, rules and regulations, we are of the opinion and so hold that the refusal by the plaintiff to grant to the cooperative the required right-of-way for its transmission line, ipso facto, worked a forfeiture of his membership and an abrogation of the contract between themselves. The conclusions announced make it unnecessary to decide other questions discussed by counsel. The judgment is reversed and the cause remanded with a direction to the District Court to set aside its judgment and for further proceedings thereafter, in conformity with the views herein expressed. The plaintiff (appellee) to pay costs of the trial court and of this court. It is so ordered. SADLER, McGHEE, COMPTON and COORS, JJ., concur.