KRS 272.221: Exclusive contracts for agricultural products -- Damages for violation --

Injunctive relief -- Notice to landlord or tenant.

(1) An association and its members may make and execute contracts, requiring the

members to obtain specified services exclusiv ely from the association or to sell,

during any designated period of time, all or any specified part of the members'

agricultural products or specified commodities exclusively to or through the

association subject to the right of any member to be released at a designated period

in each year, by giving prescribed notice. Such contracts may provide that the

association may sell or resell the products of its members, with or without taking

title thereto, and pay over to its members the resale price, or the poo l price in case

of pooling of sales, after deducting all necessary selling, overhead, and other costs

and expenses, including interest or dividends on stock, not exceeding eight percent

(8%) per annum, and any other deduction authorized by the bylaws or su ch

marketing contracts.

(2) An association's bylaws or contracts with members may fix, as liquidated damages,

specific sums to be paid by a member to the association if he breaches any provision

of the contract and may provide that the member shall pay all costs, premiums for

bonds, expenses and fees, in case any action is brought upon the contract by the

association. Liquidated damage provisions in contracts with members shall be

enforceable in the courts of this state and shall not be regarded as penalties.

(3) If a breach or threatened breach of a contract with a member exists, an association

shall be entitled to an injunction to prevent the breach or further breach of the

contract, and to a decree of specific performance thereof. Pending the adjudication

of such an action, and upon filing a verified complaint showing the breach or

threatened breach, and upon filing a sufficient bond, the association shall be entitled

to a temporary restraining order and preliminary injunction against members.

(4) A landowner, or lessee, of land on which any agricultural products marketed or to

be marketed by an association are being raised or are to be raised, may by registered

letter addressed to an association, ask for information as to whether his tenant, or

landlord as the case may be, is a member of the association, or has signed a contract

with the association, and may request information as to the terms of such contract.

The request shall state the full name and address of the person inquired about. An

association sh all, within ten (10) days after receipt of such a request, furnish the

information in writing to the person so inquiring. If an association fails to furnish

the information properly requested, in any litigation that arises between that

association and the person so inquiring, it shall be presumed, in the absence of

evidence to the contrary, that that person was without notice that the person

inquired about was a member of the association or had signed a contract with the

association, or that the person inquiring knew the terms of the contract.