A comprehensive summary of today’s judicial, legislative, and regulatory developments in agriculture and food. Email important additions to: camarigg at uark.edu


JUDICIAL: Includes estate planning, landowner liability, contract, business organization, and bankruptcy issues.

Dwight Randy Green, as an individual, as the son of Ralph and Jeanne Green, and as Shareholder of Green Enterprises, Inc.; Kathy Lefor, as an individual, as the daughter of Ralph and Jeanne Green, and as a Shareholder of Green Enterprises, Inc.; and Gary Green, as an individual, as the son of Ralph and Jeanne Green, and as a Shareholder of Green Enterprises, Inc., Plaintiffs-Appellants, v. James Green, as an individual, as Trustee of the Ralph Maurice and Jeanne Green Revocable Inter Vivos Trust, as Conservator for Jeanne Green, and as President of Green Enterprises, Inc.; Ralph Maurice and Jeanne Green Revocable Inter Vivos Trust; and Green Enterprises, Inc., an Idaho corporation, Defendants-Respondents, No. 42916, 2017 WL 280959 (Idaho Jan. 23, 2017) involved a dispute regarding a family trust and the use of 400 acres of property conveyed to the family corporation by the parents. One child (defendant) wanted a lease on the property and his siblings objected, claiming it would be an unequal distribution. The siblings also claimed defendant exerted “undue influence” over the parents as he lived near them and was the only child to serve on the corporation’s board. Court observed that “undue influence is recognized where sufficient evidence has been presented that indicates a testator’s (testatrix’s) free agency has been overcome by that of another.” Court reasoned that, “In order to trigger the presumption of undue influence, opponents of an instrument must show some nexus between the fiduciary relationship and the execution of the donative instrument.” Court found no connection between defendant’s role as board member and execution of the trust instrument.

In MERCED IRRIGATION DISTRICT, Petitioner, v. THE SUPERIOR COURT OF MERCED COUNTY, Respondent; HART HIGH-VOLTAGE APPARATUS REPAIR AND TESTING CO., INC., Real Party in Interest, F072704, Super. Ct. No. CV003013, 2017 WL 345119 (Cal. Ct. App. Jan. 24, 2017), plaintiff challenged trial court’s conclusion that it was not a “municipal corporation” under a statute allowing municipal corporations to “recover all damages from any person who injures any facility or equipment of the municipal corporation through want of care.” Appellate court considered whether the term “municipal corporation” is ambiguous. Court first concluded that “an ambiguity exists because, historically, ‘municipal corporation’ has been interpreted different ways in different contexts.” Court next considered whether to extend the benefits of the statute in question to irrigation districts and concluded that “the term ‘municipal corporation’ is usually understood in its strict or proper sense . . . and does not include irrigation districts.” Plaintiff’s petition for writ of mandate denied.

Arbon Valley Solar, LLC., Interconnect Solar Development, LLC., and John Hess Constructions, Inc., Plaintiffs, v. Thomas & Betts Corporation, a Tennessee Corporation, and John and Jane Does I through, whose true identities are unknown, Defendants, No. 1:16-CV-0070-EJL-REB, 2017 WL 277402 (D. Idaho Jan. 19, 2017) involved a breach of contract stemming from construction of a solar power facility. Plaintiff was an affiliate of a “business enterprise conducting agricultural operations” in the area of the planned solar facility. Court considered “apparent” and “actual” authority issues regarding plaintiffs’ dealing with defendants and third party. Court concluded plaintiffs failed to demonstrate existence of a contract between plaintiffs and defendants, or that a third party “had either express, apparent or implied authority when he agreed to provide construction management services on behalf of [defendants].” Plaintiffs’ breach of contract claims dismissed.

SWART ENTERPRISES, INC., Plaintiff and Respondent, v. FRANCHISE TAX BOARD, Defendant and Appellant, F070922, 2017 WL 118040 (Cal. Ct. App. Jan. 12, 2017) concerned whether “the franchise tax applies to an out-of-state corporation.” Plaintiff operates a 60-acre farm in Kansas and sells beef in Nebraska, but has no sales or physical presence in California. Plaintiff invested $50,000 in Cypress LLC (a California LLC) and became a member of the LLC. Plaintiff’s investment “amounted to a 0.2 percent ownership interest.” Defendant argued plaintiff did business in California “because Cypress LLC elected to be treated as a partnership for federal income taxation purposes, and because Cypress LLC is doing business in California, so is [plaintiff].” Court ruled that “passively holding a 0.2 percent ownership interest, with no right of control over the business affairs of the LLC, does not constitute ‘doing business’ in California.”

In re Paul R. Sagendorph, II Wells Fargo Bank, N.A., Appellant, v. Paul R. Sagendorph, II, Appellee, Civil No. 15–40117–MGM, 2017 WL 327305 (D. Mass. Jan. 23, 2017) concerned a Chapter 13 bankruptcy. Bankruptcy Court confirmed debtor’s reorganization plan, “whose terms vested collateral property in mortgagee Wells Fargo over the bank’s objection.” Importantly, the Bankruptcy Court ruled that “forced vesting in full satisfaction of a claim [is] permissible so long as a plan is proposed in good faith.” Appellate court considered whether “a surrender of collateral property imposes on secured creditors a requirement to accept vesting of that property.” Appellate court reasoned that the “key issue facing the Court is the meaning of the words ‘vest’ and ‘surrender’” as used in the Bankruptcy Code. After lengthy analysis the court concluded, “the plain language of these provisions precludes forced vesting.”


REGULATORY: Includes USDA, APHIS, ITA, NASS, and NOAA rules and notices.

AGRICULTURE DEPARTMENT: Notice USDA submitted information collection requirement(s) to OMB for review. Title: Supplemental Nutrition Assistance Program Regulations, Part 275—Quality Control. Info here.

ANIMAL AND PLANT HEALTH INSPECTION SERVICE: Rule APHIS published a final rule amending the fruits and vegetables regulations to allow the importation of lemons from northwest Argentina into the continental United States. Details here.

INTERNATIONAL TRADE ADMINISTRATION: Notice Department of Commerce amends the final results of the antidumping duty administrative review of pasta from Italy to correct a ministerial error. The period of review is July 1, 2014, through June 30, 2015. Details here.

NATIONAL AGRICULTURAL STATISTICS SERVICE: Notice NASS will request revision and extension of the Agricultural Surveys Program. Details here.

NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION:

Rule NMFS implements accountability measures for Atlantic migratory group cobia that are not sold in the exclusive economic zone (EEZ) of the Atlantic. Info here.

Rule NMFS announces reduction of the commercial per-trip possession limits for the skate wing and skate bait fisheries through April 30, 2017. Details here.