Petition — Parish v. Maryland & Virginia Milk Producers Ass'n
Supreme Court brief1979
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IN THE ') FEB 121979 |
Supreme Court of the United States... .....
—
—-
eee — 7 ——
OCTOBER TERM, 1978
vo, 4871246
FRANK P. PARISH AND
THEODORE FISHER PARISH,
Petitioners,
v.
MARYLAND & VIRGINIA MILK PRODUCERS
ASSOCIATION, INC., et al,
Respondents.
PETITION FOR WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
FRANK P. PARISH
THEODORE FISHER PARISH
518 E. Baltimore Street
Taneytown, Maryland 21787
Petitioners, Pro Se
—
The Paul M. Harrod Company, Baltimore, Maryland 21234
i
INDEX
TABLE OF CONTENTS
Page
cre. : Caceddwes csvscscadebws ce wes 2
ree ee Ei is eb ewe ves veces dconsiieseed 2
Gov k aac dclbeoeesccesceces 2
SE a ra 3
CONCISE STATEMENT OF THE CASE ................. 4
REASONS FOR GRANTING THE WRIT................ 43
SS ee 44
IR a er A. |
ii
TABLE OF CITATIONS
Cases
Page
A.B.C. Packard, Inc. v. General Motors Corp., 275 F.2d
(9th Cir. 1960) 0... ccc cece cece eee cceceees 8,12
Atlanta Trust Co. v. National Bondholders Corp.,
I So gc cbc Hh6 Sb sane er cevsbeccnsiees 38
Balch v. Beach, 119 Wis. 77, 95 N.W. 132..........-+2+55: 6
Barber v. Rukeyser, 39 Wis. 590... 2... 6. eee eee e renee 6
Boring v. Ott, 138 Wis. 260, 19 L.R.A. (N.S.) 1080,
Se cos pbb eens sos becbe bes 6
Bowsman v. Anderson (1912) 62 Or. 431, 123
Pac. 109w rehearing denied in (1912) 62 Or. 444,
oe ae Tee eS ee ee eee 37
Branson v. Harris, Mun. App., 100 A.2d 38............--- 23
Burnett v. Milnes (1897) 148 Ind. 230, 46 N.E. 464........ 37
Campbell-Kawannanokoa v. Campbell (1907) 152 Cal.
2O1, 92 Pac. (O46... cece sc ccccccvecvvscccccece 37
Carter Oil Co. v. Belair, 57 So. 2d 64, 256 Ala. 650........ 23
Conley v. Gibson, 355 U.S. 41, 45-46 ere 3
Conway Corp. v. Federal Power Commission (1975),
510 F.2d 1264, 187 U.S. App. D.C. 43, cert.
granted 96 S. Ct. 355, 423 U.S. 945, 46 L. Ed.
Ne i ee ie Rekha ark Oke tween seed 40
Coon v. Seymour, 71 Wis. 419 ....... 602 e cece e eee ee eens 6
Crowns v. Forest land Co., 102 Wis. 97, 78 N.S. 433 ........ 6
Dioguardi v. Durning, 139 F.2d 174 (CA 2 1944).........-. 3
Evans v. Lynn, D.C., N.Y. 1974, 376 Supp. 327.........-- 41
First Trust Co. of Lincoln v. Carlson, et al
ee ed , cheb eepe-viet bes tasewne sts \4 38
—
Griffin v. Breckenridge, 403 U.S.A. 102................. 43
Gonzles v. Freeman, 1964, 334 F.2d 570, 118 18
PD UTS ha coe Sede bhekbbes wes ss detec. 41
Haines v. Kermer, et al, 404 U.S. 519-521................. 3
Hayward v. Campbell, 1938, 199 A. 530, 174
PS Ca WS UA NORE Orci wedi scale wees tore. 21
Henry v. White, 60 So. 2d 149, 257 Ala. 549 ............. 23
Seu Pu NM I ID og Fk bn vie vb a 6b 0 hv wee nen ies 6
Hill v. Wright, 20 A.2d 388, 128 Conn. 12............... 23
Johnson v. Coleman, 23 Wis. 452, 99 Am. Dec.
CS MURASEVCON VES KHANS ELKO ee eldan be o0ne fas 6
Kaufmann v. McLaughlin, 114 P.2d 929, 189
ee SUPE nies Ue er Ee ies ee ees oe 4, 36
Laun v. Kipp, 155 Wis. 347, 145 N.W. 183,
5 A.L.R. 655-675 ..... ee EM OK CE ety ache 4, 37
Lee v. Resor, D.C. Fla. 1972, 348 F. Supp. 389 ............ 41
McCrory Stores Corp. v. Braunstein, Inc., 134 A.
eer ee ee ee ere 22
McDowell v. Schlesinger, D.C. Mo. 1975, 424 F.
EE Ahis baveecedsasadeeuudts eel oy 40
McGowan v. Paul, 181 Wis. 388, 396, 123 N.W. 256......... 4
Marshall v. Holmes, 141 U.S. 589, 35 L.Ed. 870, 12 Sup.
Se IPS UKS CNWOU% Dis PERE Woe ve kdivickin ics g*
Maryland & Virginia Milk Producers Association v.
District of Columbia, 119 F.2d 787, 792
Gee PES, Fe iw SAG becehuiscleuccneece. 20
Northumberland County v. Indpendent Miners,
Breakmen and Truckers Assn. of Shamokin,
Com. Pl., 24 Northumberland Leg. J. 134............ 23
Nye v. Sochor, 92 Wis. 40, 53 Am. St. Rep. 896,
I sara 045 04's Oo eee ceed ceceatu 6
iv
Page
Parish v. Maryland & Virginia Milk Producers
Association, 250 Md. 242, A.2d 512
Oe eee eee eee Te 4, 6,8
Parish v. Maryland & Virginia Milk Producers
Association, 261 Md. 618, 277 A.2d 19, cert.
denied, 404 U.S. 940 (1971 - Parish II)............. 7,8
Phillips v. Dawson, D.C. Ky. 1975, 393
TS caine 6 4ane seine diss des cabs veecd 40
Pico v. Cohen, 91 Cal. 129, 13 L.R.A. 336,
25 Am. St. Rep. 159, 25 Pac. 970,
aah eee ses pelp eens ees bey eCards 6
Robinson v. Pottinger, D.C. Ala. 1974,
EE EE ee eee oe eee ee 40
ee, SU ID a hk alec dscns beaeseoes 21
Schneider v. Sellers (1900) 25 Tex. Civ. App.
ee es See ee ee ee 37
Smith v. Smith, (1914) 210 Fed. 497, affirmed
in BOGS. SPC, GES, FOS POGE cc nccccewecsess. 37
Sohler v. Sohler, (1920) 135 Cal. 323, 87 Am.
Ss 8 8 fs eee rer ere rrr ere re 37
r,s ca vb cree Owe eedcemend 4
Uecker v. Thiedt, 133 Wis. 148, 113 N.W.
ee eres Spina e ed ead 6
U.S. v. McDonald Grain and Seed Co., D.C. N.D.
1957 F. Supp. 329. Rev. on other grounds,
EE a 2G in obi palkip yeahs bh kted 42
U.S. v. Throckmorton, 98 U.S. 61, 25 L.ed. 93............. 6
Vinson v. Vinson, 54 So. 2d 509, 256 Ala. 259............ 23
Zinc Carbonate Co. v. First Nat. Bank, 103 Wis.
125, 74 Sm. St. Rep. 845, 79 N.W. 229 .........0008- 6
oa:
Vv
Page
STATUTES
WEES cane hee chk hy oe ee 2
i rr We UI oii c vin occa dade ceeneck 42
Se Ne bs on oa oa kee scaoe ccdveien 22
Federal Declaratory Judgment Act, 28 U.S.C.A.
aan duis e see ee ee oak OE de 22
a RS I anes aR ee SE Acs 39
¥ = Se I ois ook sah sis wre pe es 41
15 - § 414B (9) Debarment - Generally.................. 41
Annotated Code of Md. - Art., 23 § § 349-377....... 3, 10, 11
U.S. Constitution, Article 14...........ccccccccce App. 60
(Ae AOS eee s (Appendix to Appellants’ Brief No. 78-1079)
MISCELLANEOUS
Atlantic Reported, 2nd Series - -
I AS GI on 08 ehiack wo weak 9
I cas Fk bab sack aS s bee dees nee kx. 12
Ps 5 GAs 066 4S a orden k oxen 10
I Te ee 5 ee En ae dT” 9,13
ee ee 22
Federal Rules of Civil Procedure, Rule 57................ 22
Mtge 8 i aE Pe Oe ee eR eR I a 21
Scott on Trust, Volume 1, §2.2....................... 21
Wane pO PG ii oink ons kav ew'ccccg gan 11
suites sociigsiin.n. ca CEL EERE OT OPO COTTE ELLE. 44
AE ee eT eG Rie ne OTT 19
vi
INDEX TO APPENDIX
Page
Appendix A
Opinion - United States Court of Appeals for the
I oC Ce ae de ye aba e.b oa EMO A. 1
Appendix B
U.S. District Court’s letter, memorandum,
oo inc ace he la kaa ee eee eaten A. 7
Appendix |
Excerpt from Amended Complaint - Reduction in
Price Paid Producers from 1950-1967 (1954-1966). . A. 18
Appendix 2
NE 4 tn din teak OK NA Ae Oe A. 20
Appendix 3
ge ee eee yr errr en A. 23
Appendix 4
ee eee Welewa ta ade aas ste A. 26
Appendix 5
POS an ee Asha hss pewk nes eeeiee ee A. 28
Appendix 6
4 Ee ere ere Serer rT A. 30
Appendix 7
4 | PERUTTRULTETET CLL Ter A. 32
er,
Appendix 8
Exhibit Q
Appendix 9
Exhibit W
Ve SPeaecesceseees £ee 6 6 HOO 46 28 Oe 6 eee ee
IN THE
Supreme Court of the United States
OCTOBER TERM, 1978
NO.
FRANK P. PARISH AND
THEODORE FISHER PARISH,
Petitioners,
Ve
MARYLAND & VIRGINIA MILK PRODUCERS
ASSOCIATION, INC., et al,
Respondents.
PETITION FOR WRIT OF CERTIORARI TO THE
, UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
The Petitioners, Parish, pray that a writ of certiorari
issue to review the opinion and judgment of United States
Court of Appeals for the Fourth Circuit rendered November 3,
1978 without a hearing.
OPINIONS BELOW
Fourth Circuit. The unreported opinion of the Court of
Appeals for the Fourth Circuit (App. A, infra. pp. 1-8).
District Court. The unreported opinion of The United
States District Court for the District of Maryland (App. B,
infra, pp. 9-17).
JURISDICTION
The Court’s jurisdiction is invoked under 28 U.S.C.
Section 1254 (1) to review the opinion and order of The
Fourth Circuit Court of Appeals entered on November 13,
1978.
ee
QUESTIONS PRESENTED
1. Whether or not the United States Court of Appeals
for the Fourth Circuit erred in summary of opinion of the
District Court opinion of this matter.
2. Whether or not the United States Court of Appeals
for the Fourth Circuit erred in conclusions of law set forth
in its opinion on summary affirmance specifically :
A. Whether the Court erred in treating the matter of
Declaration of Trust as res judicata;
B. ‘Whether the Court erred in refusing to order a hearing
to determine the existence of facts which would take the
allegations of fraud outside of the operation of any of the
defenses pleaded;
3
C. Whether the Court erred in refusing to order a hearing
to invoke the equity jurisdiction of the courts to remedy fraud;
D. Whether or not the Court below erred in refusing
a hearing on this pro se complaint;'
E. Whether or not the Court misquoted prior decision
in the determination of both opinions below.
PROVISIONS INVOLVED
Annotated Code of Maryland, Article 23 §349 to §377
does not prohibit a cooperative from contracting as a Trustee,
but actually provides for such relationship herein. See Appen-
dix 10 (Page 174) to Appellants’ Brief No. 78-1079.
' Haines v. Kermer, et al, 404 U.S. 519-521 Per Curiam.
““. . . The only issue now before us is Petitioner’s con-
tention that the District Court erred in dismissing his pro se
complaint without allowing him to present evidence on his
claims . . . we cannot say with assurance that under tiie allega-
tions of the pro se complaint, which we hold to less stringent
standards than formal pleadings drafted by lawyers, it appears
beyond doubt: that the Plaintiffs can prove no set of facts
in support of his claim which would entitle him to relief.”
Conley v. Gibson, 355 U.S. 41, 45-46 (1957). See Dio-
guardi v. Durning, 139 F.2d 174 (CA 2 1944).
*“*. . . Accordingly, although we intimate no view whatever
on the merits of Petitioner’s allegations, we conclude that he is
entitled to an opportunity to offer proof. The judgment is
reversed and the case is remanded for further proceedings
herewith.” (cited by the Court - App. B. page 16).
4
CONCISE STATEMENT OF 1HE CASE
A. This is an action in fraud against tiie Maryland and
Virginia Milk Producers Association, Inc., which basically
alleges that the Association, through its’ officers, directors
and counsel, defrauded its many members, including Petitioners
Parish, by diversion and misappropriation of funds, improper
accounting procedure, misrepresentation, and concealment
of facts (vital to Association’s solvency) from the membership
and the Government, which directly violates the Trust Relation-
ship between the Association and it’s members.? This, a
separate independent action, was filed pro se, in desperation
after engaging and discharging three lawyers, in prior action,
for willful failure to introduce evidence vital to defendant
association’s solvency and the best interest of their clients.’
See paragraphs 77A, 78, 82 and 83 (Appendix to Appellants’
Brief No. 78-1079) of Complaint repreated herein, also 79,
A, B, C, D, and 80. Said prior action was dismissed on
Demurrer, appealed, reversed and remanded (250 Md. 512
(1968) ) (Parish v. Maryland & Virginia Milk Producers Asso-
ciation, Inc.
2 “One standing in the relation of a Trustee to another
owes to the other the duty of making a full disclosure of all
matters appertaining to the Trust, and neglect to do so...
is a “fraudulent act’ and that duty exists independently of
inquiry in judicial proceedings, and persistent failure of that
duty in judicial proceedings to the prejudice of the other
and the advantage of the Trustee is “extrinsic fraud”. Kauf-
mann v. McLaughlin, 114 P.2d 929, 189 Okl. 194.
3 Laun y. Kipp, 155 Wis. 347, 145 N.W. 183, 5 A.L.R.
655-675:
“Marshall, J....
B. This is an appeal on the pleadings inasmuch as no
trial on the merits and no oral argument on appeal have thus
far been allowed.
footnote’ (continued)
P. 655: “When the fiduciary position of Respondent is
considered and that Appellants had used due care toemploy
attorneys whom they had reasonable ground to suppose were
competent to protect their interests . . a Court of Equity should
not refuse to open its doors to prevent the success of a wicked
scheme to cheat because of neglect at this point. It was Re-
spondent who should have been the moving party as regards
the accounting. .”
P. 659: “If the judgment is inequitable and unjust as
rendered, as was induced by fraud or other circumstances
in the proceedings leading up to its entry which will warrant
equitable relief, that relief can be obtained only by a separate
action.
“Where ‘the remedies are infirm, precedence will be a
constant guide, but never a bar. Where a new condition exists,
and legal remedies are inadequate, or none are afforded at all,
the never failing capacity of equity to adapt itself to all situ-
ations will be found equal to the case . .” (McGowan v. Paul,
181 wis. 388, 396, 123 N.W. 256. . . Stowell v. Eldred, 26
Wis. 504... ).
“There, for the first time, the precise nature of the fraud
which will render a judgment open to attack in an independent
action in equity was thus stated ... The real principle of the
adjudications is the power of equity to relieve against uncon-
scionable judgments . .””
6
C. Memorandum and Order by the Federal District
Court (App. A & B) states:
“The earlier campaigns of this crusade are described
in Parish v. Maryland and Virginia Milk Producers
Association, 250 Md. 242 A.2d 512 (1968- Parish 1),
footnote’ (continued)
Zinc Carbonate Co. v. First National Bank, 103 Wis.
125, 74 Sm. St. Rep. 845, 79 N.W. 229; Crowns y. Forest
Land Co., 102 Wis. 97, 78 N.S. 433; Barber v. Rukeyser, 39
Wis. 590; Hiles v. Mosher, 44 Wis. 601; Coon v. Seymour,
71 Wis. 419; Johnson v. Coleman, 23 Wis. 452, 99 Am. Dec.
193; Nye v. Sochor, 92 Wis. 40, 53 Am. St. Rep. 896, 65 N.W.
854; Balch v. Beach, 119 Wis. 77, 95 N.W. 132; Boring v. Ott,
138 Wis. 260, 19 L.R.A. (N.S.) 1080, 119 N.W. 865; United
States v. Throckmorton, 98 U.S. 61, 25 L. ed. 93; Uecker
vy. Thiedt, 133 Wis. 148, 113 N.W. 447; Marshall v. Holmes,
141 U.S. 589, 35 L. 2d 870, 12 Sup. Ct. Rep. 62; Pico ».
Cohen, 91 Cal. 129, 13 L.R.A. 336, 25 Am. St. Rep. 159,
25 Pac. 970, 27 Pac..537...
P.666: “It would be a strange weakness in our system
of equity jurisdiction, if a Court could not, or would not lend
its aid to prevent a party from being greatly wronged by reason
of his attorneys . . . being imposed upon by the adverse party.”
P. 668: “The crowning purpose of Courts is to effect
justice...”
P. 669: “In all situations and under all circumstances,
whether new or old, the principals of equity will point the
way to justice.”
~
and Parish v. Maryland and Virginia Milk Producers
Association, 261 Md. 618, 277 A.2d 19, cert. denied,
404 U.S. 940 (1971 - Parish II).”
footnote*® (continued)
Complaint - Para. 77A. “Plaintiffs Parish allege that
Defendant Lawyers, Messrs. Brune, Robertson, Shaffer and
Michie, in conspiracy with all Defendants named herein, per-
sistently refused to allege their clients (Parish, Wharff and
Wenger) Trust Relationship (see paragraph 82 herein), with
Defendant Association, failed to introduce evidence vital
to the Defendant Association’s (Trustee) solvency thereby
aiding and furthering concealments of said evidence in an
over-all conspiracy with the intent and purpose to defeat
the due course of justice in the State of Maryland with pur-
poseful intent to deny Plaintiffs, (citizens) under color of
law, equal protection of the law. The Plaintiffs have been
injured in person and property and deprived of exercising
their rights as citizens of the United States by said lawyer
defendants willful furtherance of the conspiracy.”
Para. 82: ‘Plaintiffs further allege that (in prior action),
despite the Court’s admonition, October 17, 1969, page 17 and
18 of transcript, “lines 23 to line 6 of page 18,” The Court’s
disposition of these matters and the Court’s ruling with respect
to the Trust theory, which we in effect sustain at this stage
of the proceedings, necessarily indicate at this stage and cer-
tainly prior to trial, the necessity for the Complainants
specifically to amend the Bill of Complaint in order to state
a cause of action more clearly and amend their Prayers for
Relief rather than rely upon a general Prayer for Relief that
is set forth in the last prayer of the Complaint.”
8
The District Court further states (App. B-12):
“A comparison of the first three Causes of Action
in the Amended Complaint with the extensive and
detailed Parish I and Parish II opinions shows that
Plaintiffs are attempting to relitigate claims that
were presented and decided adversely to them in
the State proceedings, etc., etc. .”
Hasn’t the Fourth Circuit Court of Appeals and the
District Court below committed serious fraud:
1. In not taking cognizance of the obvious false quo-
tation (false by omission) by the Maryland State Court of
Appeals (Parish II) 277 Md. A.R.2d, page 48, of the opinion
in (Parish I) 242 A.2d 539, 540 (7)*;
Page 48*: ‘(7) It is clear that officers and directors of
a corporation stand in a sufficiently confidential relation to
the corporation’s stockholders to impose a duty upon them
to reveal all facts material to the corporate transactions. A. B.C.
Packard, Inc. v. General Motors Corp. 275 F.2d 63 (9th Cir.
footnote’? (continued)
Despite the above admonition, Defendants Brune and
Shaffer filed an amendment on October 20, 1969, which only
added a prayer. Parish, on the same day, filed an amendment
which properly alleged the factors essential to the Trust. On
November 5, 1969, a Joint Amendment by Brune, Shaffer
and Parish was filed which adopted the allegations set forth
in the Parish Amendment.
Para. 83: “Wherefore, Plaintiffs pray the Court to find
the Defendant, Maryland and Virginia Milk Producers Associa-
tion, Inc. to be a Trustee of an Express Trust.”
9
1960). See 37 C.J.S, Fraud §16, page 248. The confidential
relation is even more apparent in a member corporation such as
the Association. The allegations of the complaint indicate
that the members have not been properly informed by the
officers and directors of the Association in regard to the various
transactions set forth in the complaint and indeed, that the
members have been deceived by the false annual reports. The
members have been lulled into inaction and the Association
has been damaged by failing to take action promptly to assert
its rights so that possible defenses of limitations may have
accrued and, in any event, it has been made more difficult
to ascertain and have the facts necessary to establish the claims
of the Association.”
“The complaint sufficiently alleges facts which in them-
selves indicate a fraudulent concealment by the defendant
auditor and active fraud by Hooper and Robinson as well as
a fraudulent concealment by them and breach of fiduciary
duty. The concealed facts were material, properly relied on
by the Association and its members, and the Association’s
damage resulting therefrom has been alleged.”
Quoting’ said court, from page 48 Md. 277 Atlantic
Reporter 2d Series:
“We think the Chancellor has stated quite accurately
the standard against which the conduct of the
directors must be measured. In Parish, Judge Barnes
said, for the Court:
AT THIS POINT
OMITTING THE ABOVE QUOTED PARAGRAPH 7, thus
falsely distoring the opinion of Judge Barnes.
10
“It is well established that courts generally will not
interfere with the internal management of a cor-
poration at the request of a minority stockholder
or member. The conduct of the corporation’s affairs
are placed in the hands of the Board of Directors and
if the majority of the board properly exercises its
business judgment, the directors are not ordinarily
liable. This sound general rule, however, is subject
to the important exception that the directors will
be held liable if they permit the funds of the cor-
poration or the corporate property to be lost or
wasted by their gross or culpable negligence.” 250
Md. at 74, 242 A.2d at 540. (Second emphasis
added.)
Petitioners submit that the above distortion (by omission)
of Judge Barnes opinion was intentional and indefensible;
C. 2. In not taking cognizance of the arrogance displayed
by the Chancellor under the caption “Conclusions of Law,”
(page 47) and as quoted by the Court of Appeals on page 48,
the following illegal, presumptuous inference that the Maryland
Code, Article 23, §349* (App. 174) (Appendix to Appellants’
Brief No. 78-1079), United States Court of Appeals, Fourth
Circuit No. 78-1079, has any legal bearing upon a cooperative
contracting with its members as a Trustee;
(3) The appellants, on the other hand, insist that
‘the Association is an express trustee of its members’
milk and the proceeds thereof and that its directors
and managing officers (having) shared the trust
obligation of the Association with respect thereto***
are held to a higher standard than that of directors
—,
lh a aa r
11
of the ordinary business corporation, which is not
a trustee handling other people’s money and
property.’ In dealing with the question whether
the appellants lacked standing to maintain this
action, the chancellor thought there was a ‘fiduciary
relationship subsisting between the members and
the Association as a result of the consignment to
the Association of their produce.’* But, he said,
‘the Cooperative Code provisions (Code 1966 Repl.
Vol., Art. 23, §349) are cast in the mold of the
corporation law of the State of Maryland.’ He
continued:
“*** We do not think that the simon-pure relation-
ship that governs between cestui que trust and
trustees are necessarily imported into the relation-
ship that subsists between the Association and its
members. See Scott on Trusts, Volume Five, Section
495, at page 3534.
(Note statement following re the Maryland Code.)
‘In othet words, we think there is a fiduciary relation-
ship which gives the former members a right to
maintain an action, but we, nevertheless, find and
hold that the standard applicable to the directors
upon the Bill of Complaint of the complainants
in this case is the same standard as would apply
generally with respect to the officers and directors
of a stock corporation or a commercial organization
which is a corporate entity. The standard we are
all familiar with namely that such officers and direct-
ors are liable for gross and culpable negligence.
(Emphasis added. )
12
“The familiary provisions, also, we think, of cor-
poration law would obtain here with respect to the
right or not of a court to intervene in the internal
>
affairs of a corporate organization.’ .. .’’;
*3. In not taking cognizance of the chancellor’s above
finding as to “The standard applicable to directors upon the
Bilt of Complaint,”’ is directly negated by the Barnes paragraph
(7) omitted?
“(App. 51) (Appendix to Appellants’ Brief No. 78-1079)
LAW OF CASE
79. Opinion by the Court of Appeals, 242 Atlantic
Reporter 2d Series, 250 Md. 24, Frank P. Parish, et al. v.
Maryland and Virginia Milk Producers Assoication, Inc., Md.
103 - May 22, 1968:
A. P. 521 (12) (e) “An illegal attempt by the
Board of Directors through By-Law Amend-
mentson March 30, 1966, to impose restrictions
upon future derivative suits brought by members
requiring: (1) an application to the Board of
Directors and (if) authority for the suit is
refused, and (2) a majority vote of all members
attending an annual or special meeting - all
contrary to the laws of the State of Maryland.”
B. P. 539 (7) ‘It is clear that officers and directors
of a corporation stand in sufficiently confiden-
tial relation to the Corporation’s stockholders
to impose a duty upon them to reveal all facts
material to the corporate transactions”. A.B.C.
13
Packard, Inc. v. General Motors Corp., 275
F.2d 63 (9th Cir. 1960, see 37 C.J.S. Fraud,
Sec. 16, page 248. THE CONFIDENTIAL
RELATION IS EVEN MORE APPARENT
IN A MEMBER CORPORATION SUCH AS
THE ASSOCIATION.” (emphasis supplied )
Note that (App. 174 to 187) (Appendix to Appellants’
Brief No. 78-1079) the Annotated Code of Maryland does
not prohibit a cooperative from contracting as a Trustee,
but actually provide for such relationship. See App. 182,
§364 and §372.
App. 182, §364:
CONTRACT WITH MEMBERS
Contracts between any Association and its members, whereby
such members agree to sell . . . their products... through...
the Association, and...
App. 185, §372:
OPERATION ON NONPROFIT BASIS
(a) Agreement with members. - - Any Association .. .
may operate upon a non-profit basis by contracting to pay
the members for the products sold by said members . . . through
the Association, (consignment) the resale price minus a uniform
charge to cover expenses involved in the handling of said
products;. ..;
14
C. 3. In not taking cognizance of the fraud re new By-Laws,
by the chancellor, Messrs. Brune, Shaffer and Michie.
Record of change in By-Laws (paragraph 78 of Complaint)
(Appendix to Appellants’ Brief No. 78-1079), Brune and
Shaffer stated in their Brief filed in the Court of Appeals
of Maryland, September Term, in behalf of Parish, et al, Sept-
ember Term, 1967, as did Parish in their brief.
“An illegal attempt by the Board of Directors through
amendments March 30, 1966 to impose restrictions upon
future derivative suits brought by members attending annual
or special meeting - all contrary to the Laws of Maryland.”
May 27, 1968
The Court of Appeals ruled (242 A.R. 2d 521 (12e):
“An illegal attempt by the Board of Directors through By-Law
Amendment on March 30, 1966, to impose restrictions upon
future derivative suits brought by members requiring (1) an
application to the Board of Directors and (if) authority for
the suit is refused and (2) a majority vote of all members
attending - ALL CONTRARY TO THE LAWS OF MARY-
LAND.”
November 6, 1969 (Exhibit T to Amended Complaint)
Hearing before John P. Moore, Judge.
These same By-Laws were offerred in evidence by Mr. Merrigan.
“(The Court) Is there any objection?
“Mr. Shaffer) No objection.
LLL OG oa
15
“‘Brune also present (silent)
“(The Court) They will be received” (see pp. 74, 75 of Exhibit
T of the amended complaint ) (Appellants’ Appendix to Brief
No. 78-1079).
On December 16, 1969 (page 39, paragraph 78 - App. 50),
“The Circuit Court for Montgomery County, Maryland, page
10, line 4, the Court stated: ‘At the time, in consideration
of the Demurrer which had been sustained by another member
of the Court, the Court of Appeals found that it could not
_be held as a matter of law that the Plaintiffs lacked standing
to sue, particularly on the basis of the By-Law provisions
which are quoted in the Court’s opinion. “Jt has come to
light, of course, in the proceedings here that the By-Laws
were changed by an action of the members of the Association
in 1965... At the time of the consideration of the demurrer,
the Court of Appeals did not have before it these documents
with respect to standing . . . The Court’s conclusion, after
great consideration of all matters involved, is that with respect
to this, the Complainants are bound by the new By-Laws which
were adopted and the full text of which appear in the record
in this case.’’ (Emphasis supplied.)
(ALL FALSE AS ABOVE NOTED.)
Note illegal By-Laws also in Brune’s Third Amended Complaint
(p. 32 - Joint Record Extract - Appendix to Appellant’s Brief
No. 78-1079, also p. 66, paragraphs E and F.)
In light of the District Court’s characterization of the First
Cause of Action, “A plethora of allegations about the legal
relationship.” (Appendix B, Page No. 10 herein)
16
Petitioners quote important statements of facts and allegations
from their Amended Complaint cited in full in Appendix
pp. 20-23 (Appendix to Appellants’ Brief No. 78-1079).
FIRST CAUSE OF ACTION
“20. In November, 1972, Mrs. F. P. Parish (Mrs. Theo-
dore Fisher Parish, Plaintiff), signed an individual contract
(Standard Marketing Agreement) with the Defendant, Maryland
and Virginia Milk Producers Association, Inc., dated November
18, 1942 (Exhibit D) (Appendix to Appellants’ Brief No. 78-
1079), presented herewith and prayed to be made a part hereof.
“21. On October 9, 1961, the Defendant Association
signed a new contract with Frank P. Parish and Theodore
Fisher Parish, jointly (Association’s then Standard Marketing
Agreement), (Exhibit E) (Appendix to Appellants’ Brief No.
78-1079), presented herewith and prayed to be made a part
hereof. (All assets, farm and dairy included, are and have
been jointly owned; they having been paid for by funds from
joint bank account.)
“22. Plaintiffs allege that they complied with their
obligations under the above cited Parish contracts, particu-
larly, all milk produced on their farms in the years 1943 to
1966 was consigned to and accepted by the Defendant Asso-
ciation pursuant to paragraph | of each contract;
“23. The Defendant Association accepted, on consign-
ment, all Plaintiffs’ and other members’ milk, withholding
monies from the sale of said milk pursuant to the manifesta-
tion of intention expressed in its Articles of Incorporation
and said signed contracts, which impose a duty upon the
ALO Ce It TTS
17
Association to deal with all such milk and money in the sole
interest of its members and the Court in enforcing the duty
is giving effect to that intention;
“24. By virtue of the Defendant Association’s Board
of Directors Resolution July 9, 1954, the Board of Directors
confirmed and acknowledged its duty and obligation to account
to the members for services rendered and all monies received
and disbursed by The Association. Also, page 6 of Resolution
provides for use of facsimile signatures on checks;
“25. The Defendant Association has possession, control
and legal title to money, personal and real property, also
claims against others, all acquired by withholding and investing
net proceeds from the sale of members’ milk (withholdings
in excess of contract provisions, by Director’s Resolution
November 1, 1964), which property and claims are held for
the benefit of the members, including Petitioners, Parish,
IN A SHARE UNKNOWN TO THEM. (All of which com-
prise the Trust Res.)
“26. Plaintiffs allege that: upon the acceptance of
Plaintiffs’ and any other members milk pursuant to the man-
ifestations of intention, above alleged and set forth, the Defend-
ant Association became a Trustee of an Express Trust which .
has not been terminated.
“26A. Plaintiffs allege that the Defendant Association
(Trustee), has never claimed to be the owner of the legal title
adversely.
Defendants do not deny the factors set forth in Com-
plaint which constitute an Express Trust: (PLAINTIFFS
FIRST CAUSE OF ACTION - pages 9 - 12 herein).
18
Plaintiffs allege that the Trust question has not been
adjudicated; that the District Court’s ruling December 16,
1969 and its denial of Plaintiffs Petition for a Rehearing de-
prived Plaintiffs of a fair trial (paragraph 81 - 5 herein, page 42.)
TRUST NOT TERMINATED
“27. Plaintiffs have received two letters dated September
14, 1973 and September 14, 1974, each enclosing checks
payable to Plaintiffs for money due them for milk Plaintiffs
consigned to the Association during the years 1959, 1962 and
1963. There is also the contingent liability for further monies
which may be found due and payable;
“27A. Said Defendant, Maryland and Virginia Milk
Producers Association, Inc., by a letter to Plaintiffs, Parish,
dated September 12, 1975 and enclosed with said letter its’
Check No. 712744236 dated September 15, 1975, drawn
on National Savings & Trust Co., Washington, D.C. payable
to said Plaintiffs, in the amount of $23.27.
Said letter stated “During the year 1974, the Association
received $24,719. from the bank for Cooperatives as a result
of operations in the years 1963 and 1964.
Our records indicate that you shipped milk in 1963 and
1964 and are therefore entitled to participate in the patronage
allocation of these funds on your production in those years. .
since the Association received the full amount in cash. We
are making the full distribution to Producers in cash. The
above check represents your pro rata share.”
Plaintiffs allege that the above cited letter and check
clearly indicate that the Defendant Association, by sending
i9
its’ check and letter, recognizes their continuing obligation,
as Trustee, to account for Income and Disbursements. The
Defendant Association, by sending said letter and check,
reaffirms the Association’s obligation to account for its Income
and Disbursements.
“28. Plaintiffs allege that: an actual and a justiciable
contoversy exists between the Complainants and the Defend-
ant Association, on a number of issues, one of which is the
legal relationship between the parties. The determination
of legal relationship is essential, it being a basic factor bearing
upon an adjudication of the many issues before the Court
in four additional causes of action contained therein. The
Defendant Association and its’ Directors have denied the
Trust Relation in answer to Complaint filed in prior action.
“29. Wherefore, Plaintiffs pray for declaratory judgment
that at the point in time (1942), when the Defendant Associ-
ation accepted Plaintiffs’ milk, (the Trust Res), the _ legal
relationship of the Defendant Association to Plaintiffs became
that of an Express Trust and Beneficiaries which has not been
terminated.”
In support of Plaintiffs allegations that the Defendant Associ-
ation is a Trustee of an Express Trust as set forth in the First
Cause of Action (paragraphs 20-29 of Amended Complaint);
March 9, 1976: (Appendix to Appellants’ Brief No. 78-1079)
“1. Scott on Trusts, §462.1:
““. . . An express trust is a fiduciary relationship
with respect to property, arising as a result of a
manifestation of an intention to create it and sub-
20
jecting the person in whom the title is vested to
equitable duties to deal with it for the benefit of
others...”
The manifestation of an intention of this instance,
being the intent expressed in Certificates of Incor-
poration, Exhibits A and C*, and the terms set
forth in the contracts, (Exhibits D and E to the
Amended Bill of Complaint).
Title to Property (Milk)
and Ownership
In establishing the trust principal, the Complain-
ants direct the Court’s attention to a judicial
conclusion enunciated in previous litigation involving
the Association of at least one of the _ essential
elements necessary to the creation of a trust relation-
ship between it and its members, Cf. Maryland and
Virginia Milk Producers Association v. District of
Columbia, 119 F.2d 787, 792 (D.C. Circ., 1941),
viz, that title to the members’ milk passed to the
Association upon delivery to the latter, and upon
case law relating to the subject of Cooperative Asso-
ciations.
In the case just cited the Association, at page 792,
we find:
SF Ey SU TET Gwe OtepnEEENe Es ogee ©
3
21
“It has been repeatedly held, in Maryland and else-
where, that a cooperative corporation is an entity
distinct from its members. We see no more reason
for asserting that all the individual shareholders
of a stock corporation own its accounts. Even when
cooperative association’s contracts with its milk -
producing members have been phrased clearly in
terms of agency, it has been conceded that title
to the milk passed to the association, and held that
the association, and not the member, was the actual
seller of the milk which the distributors bought.”
(emphasis supplied) ‘
Quoting Scott on Trusts, Volume 1, page 36, §2.2;
line 5, Third Edition, 1967 (no change in 1976):
“In the case of an express trust, however, the duty
to deal with the property arises as a result of a
manifestation of an intention to impose such a
duty, and the Court in enforcing the duty is giving
effect to that intention.”
Quoting’M.L.E. §20:
“Subject to the general rules of an express trust,
where a person has or accepts possession of personal
property, with the express or implied understanding
that he is not to hold it as his own absolute property,
but is to hold and apply it for certain specified
purposes or for the benefit of certain specified
* ALL EXIIIBITS CITED HEREIN ARE CONTAINED
persons, a valid and enforceable trust exists.” Hay-
IN APPENDIX TO APPELLANTS’ BRIEF NO. 78-1079.
ward v. Campbell, 1938, 199 A. 530, 174 Md. 540.
22
Ruhe v, Ruhe, 113 Md. 596:
“When an absolute transfer of property is made to
a person upon the faith of his promise to do certain
things, or to hold the property for the benefit of
the grantor, a valid trust is thereby created. THIS
TRUST IS ALSO ENFORCEABLE AGAINST A
THIRD PARTY WHO TAKES THE PROPERTY
BY WAY OF GIFT, ALTHOUGH IGNORANT
OF THE TRUST.” (emphasis supplied)
“POINTS AND AUTHORITIES IN SUPPORT OF
PRAYERS FOR DECLARATORY JUDGMENTS AND
INJUNCTIVE RELIEF SET FORTH IN FIRST CAUSE
OF ACTION, PARAGRAPHS 28 AND 29 (Pages ! 1-12)
AND IN THE THIRD CAUSE OF ACTION,
PARAGRAPHS B, 69 and 69A (Page 32)
“4. Declaratory Judgments and Injunctive Relief (See
Rule 57, Federal Rules of Civil Procedure.)
23
on any Court of the United States;
Branson v. Harris, Mun. App. 100 A.2d 38.
C. A complaint sufficiently shows cause of
action for a declaratory judgment where it states
the substance of a bonafide justiciable con-
troversy which should be determined.
Henry v. White, 60 So. 2d 149,
257 Ala. 549; Carter Oil Co. v. Blair,
57 So. 2d 64, 256 Ala. 650; Vinson vy.
Vinson, 54 So. 2d 509, 256 Ala 259;
Hill v. Wright, 20 A.2d 388, 128
Conn. 12; Northumberland County v.
Independent Miners, Breakmen, and
Truckers Assn. of Shamokin, Com
Pl., 24 Northumberland Leg. J. 134.
A review of the chancellor’s record of unjudicial conduct re
A. The Court is empowered to determine
any question of construction or validity arising
under a written contract and declare the rights,
status, or other legal relations thereunder of
the parties thereto.
McCrory Stores Corp. v. S.M. Braunstein, Inc.
134 A. 752, 102 N.J. Law 592.
(Also Civil Practice Act, §473.)
B. The Federal Declaratory Judgment Act,
28 U.S.C.A. Section 2201, et seq., confers
jurisdiction to render declaratory judgments
the question of Trust Relationship, by the Court and counsel,
is essential.
Paragraph 71*of Amended Complaint (Appendix to Appellants’
Brief No. 78-1079), “Complaint of necessity, includes matter
of prior litigation concerning Plaintiffs’ attorneys willful failure
to plead Trust Relationship and their refusal to follow clients
instructions. See Exhibit O - Transcript of Court Hearing
of February 14, 1969, presented herewith and prayed to
be made a part hereof.
24
Plaintiff allege that the Court displayed hostility during hearing
February 14, 1969:
“In The Circuit Court for Montgomery County, Maryland
Sitting as a Court of Equity
Frank P. Parish, et al
Complainants,
VS. | Equity No. 29524
Maryland & Virginia Milk
Producers Association, Inc.,
et al,
Defendants.
Rockville, Maryland
Friday, February 14, 1969
The above entitled matter came on for hearing, at 2:00 o’clock
p.m.
Before:
The Honorable John P. Moore, Judge.
eK KKK KE
(T. 2) (The Court) I merely identified the matter that is before
us, being your petition for a rehearing.
(Mr. Parish) Yes. Do you want me to proceed?
a
ae
~ - PSE ET CO Oe aT
25
(Court) Before you do: the record will indicate that you,
some time ago at the last hearing in open court, were allowed
a period of some 30 days within which to engage counsel.
As we recall the record in this case, at or near the completion
of that period you at that time petitioned the court for a
re-hearing.
(Mr. Parish) Right.
eK KK KK KKK
(T. 9) (The Court) Will you keep your voice up, please.
(Mr. Parish) I am sorry. I have been seeking counsel; and
Mr. Michie offered to serve as counsel and submitted first
a draft of amendment which was a fourth amended bill of
complaint. The only change between that and the third
amended bill of complaint was the addition of a prayer which
included allegations.
Then I received another one of similar character with
places for all signatures, mine on top as senior counsel because
I would not ‘go along with the other, his representing me, and
it likewise added only a prayer to the bill of complaint. It did
not follow the Court’s advice about an amendment to the bill
of complaint.
In my best understanding of the law, a prayer is not a
part of the allegation part of the bill of complaint, and I can
not go along with that under those circumstances.
I have seen two other counsel besides. Each refuses to
allow his client any authority whatsoever as to the points,
the basic points, to be covered by the litigation.
ee ES ee MATE me
26
There are endeavors which I impose upon any counsel
we will employ: the duty to proceed with the establishing
of the trust relationship, Your Honor. It is basic, and I believe
the client has that right.
HHEKKKEEEEE
(T. 14) (Mr. Parish) . .. Briefly, that exposes us all to a recog-
nition that pretrial discovery is not a perfunctory thing. The
investigation should be completed by those who started it
and based on the trust relationship. That duty and obligation
of a Trustee (T. 15) to keep full records, to inform the bene-
ficiaries voluntarily, becomes a dominant factor in this
situation.
(The Court) Are you suggesting, Mr. Parish, that you have not
been able to engage counsel because counsel do not agree
with you with respect to these matters?
(Mr. Parish) No. They do agree with me. I have Mr. Brune’s
agreement in writing. He agrees that the trust relationship
exists. But he will not pursue it in the manner that I believe
is legal.
In other words, as the Court understood, there was a deficiency
insofar as being able to establish the trust relationship by reason
of the allegations not being adequate. (See Points and Auth-
ority pp. 5 and 6 of Appellants Brief, and paragraph 82 of
Complaint pp. 4 and 5 herein. Mr. Brune has attempted and
insisted to cover this by an additional prayer. I think I have the
right to express my disagreement, to represent myself in that
disagreement...
Thank you.
ee SOT
——"
eee ne
27
(The Court) Can you state to the Court, Mr. Parish, the reason
why you have not engaged counsel?
(Mr. Parish) No. It is not. I am pointing out that the time
required is so - -
(The Court) No. The Court - -
(Mr. Parish) - - out of reason with the request of (T. 16) the
Court at the preliminary hearing for early trial date; and
accepting December 15, that is evidence to my mind of actual
- - well, I hate to put it in words - - but certainly violation of
the trust of a client.
(The Court) Can you give the Court any reason why you have
not engaged counsel during the 30-day period that was
specified?
(Mr. Parish) I have not engaged counsel - - number one, I have
not engaged Mr. Michie again because he will not present a
proper amendment to the bill of complaint. Two other lawyers
that I have encountered who were willing to accept the case
will not consider the client’s opinions at all.
KKEKKKAKAEH
(T. 19) (Mr. Parish) May I answer that, Your Honor?
Going back to Mr. Michie: he did offer to represent me, on
these terms; that is, by presenting these drafts. And they are
not acceptable to me.
As to Mr. Wharff: On December 28 he wrote to Mr.
Wenger, the other plaintiff: ‘I have attended the hearing
28
on December 17, and to my mind the most important aspect
is the lawyers for the complainants are still pursuing the premise
that our suit is a stockholders’ derivative action. On the other
hand, I’m convinced the legal relationship between the associ-
ation and the members is that of a trust, the basic difference
which is important to us being, one, under a stockholders”
derivative action the court rules on what you find is wrong;
while, two, under the trust the association trustee is legally
obligated to disclose voluntarily to the beneficiaries, members,
everything that is important for them to know to protect
their interests.
“Furthermore, we have stopped shipping milk, and are
still entitled to an accounting by the association for the milk
that has been held in trust for me. Trying our case under
the trust concept not only simplifies it truly but establishes
the trust concept for the future.
“I wrote to Mr. Herbert Brune on June 24 and again on
November 24, copies attached, respecting the trust. He has
not responded to either with respect to the trust relationship.
(T. 20) “I’m advised that the new intervenors, clients of
Mr. Michie, having expressly directed their counsel that the
trust concept is a most important part of this suit. Mr. Parish,
now representing himself, has filed a motion for an amendment
to the third amended bill of complaint, alleging a trust concept,
which we all thought was already properly alleged. (Emphasis
supplied)
“I think we should all go on record insisting on the trust
concept being pleaded in our behalf. If counsel refuse to
comply, we should then ask for the counsel’s withdrawal.”
ee
»
29
On November 24th, the letter attached to this: “Dear
Mr. Brune”: -
(The Court) We think it is not necessary, Mr. Parish,
to go into these communications.
(Mr. Parish) I have covered my point as to whether
these things are happening. It is not personal.
(Mr. Brune) If Your Honor please, if there is any way
that I can assist, since my name has been brought into this
matter rather direclty, I would be happy to attempt to do
so.
I may say this, preliminarily : this situation is very
embarrassing to me personally but it could not be as embar-
rassing as the situation that Mr. Shaffer and I found ourselves
in when, after filing a brief in the Court of Appeals, we were
notified that we were discharged by Mr. Parish and he was going
to argue his own case. As a matter of fact, (T. 21) he did argue
his own case. He made a good presentation of his feeling
that the trust concept is extemely important in the case, and
the Court of Appeals in its opinion I think decided declaration
in a derivative suit.
But the court was very careful in the opinion to bring
out what was pleaded in the complaint as it then stood with
respect to the trust concept. In fact the court - - and I think
I have a copy of the opinion here in my briefcase - - quoted
as a statement of the information on which the court was
determining the validity of the bill of complaint, the court
quoted the statement; “The association has the character
of an incorporated trust.” Meaning, and going on to explain:
eee a
30
“that it is a trustee for the members of the proceeds of the
milk and milk products sales made by the association.”
The reason why we as counsel have been very reluctant
to amend the allegations of the bill of complaint is simply
the practical one that we do not want to delay the trial, and
we do not think it is necessary. The amendment which we - -
after considerable discussion between the relative counsel - -
two of the firms were willing to make some amendment, one
was not.
The two firms that were willing to make an amendment
were willing only to amend by specifically asking for relief
based on the theory that this is, the association is a (T. 22)
trust, and stating in the prayer a request for a declaration
of, I think, five different conclusions that result from the
fact that this association is actually a trust.
As I said, the reason why counsel have been unwilling
up to this point to agree to amend the actual allegations of the
complaint was simply a practical one; no difference of opinion
whatever with Mr. Parish as to the fact that this is a trust and
should be recognized to be a trust.
a
Further, we feel that the Court of Appeals in its opinion
has recognized that this association, different from an ordinary
stock corporation, is operated as a trust for its members. And
we think that the only change that has to be made, and we are
very willing to make that change, is to put in whatever is
necessary to get the utmost benefit out of that point by asking
the Court to find in effect almost as a declaratory part of the
decree that this association is a trust and “that the following
conclusions follow from that.”
31
Now, I do not wish to tell the Court, nor do I wish Mr.
Parish to have the impression, that counsel are unwilling - -
that present counsel are unwilling - - to go along with whatever
is necessary and hopefully what Mr. Parish wants, in an effort
to try to get the utmost benefit out of the fact that this is
unquestionably a trust.
I think it is quite possible that the counsel, the present
counsel - - since we are going to have considerable (T. 23)
delay anyway, so our pra-tical reason does not seem to have
much validity - - I think it is very possible that counsel will
agree to go along to making an amendment to the complaint
which will specifically and in more detail than has already
been alleged in the third amended complaint specifically state
that this is a trust.
I go back to the fact, and the reason I am trying to think
of some means of working this situation out particularly is
that after the original complaint was filed in this case in 1965
Mr. Parish became dissatisfied with counsel and sent Veltons
communications to the then presiding Judge, and those com-
munications made it clear that he and his counsel were not
working together.
Some of the allegations about the conduct of the counsel —
were so damaging to counsel’s reputation that counsel deter-
mined they could not represent Mr. Parish. As a result of
that conflict, at an early Stage of the case beginning in the
summer of 1965, the whole case was delayed for more than
a year. And I do not want to see that happen again.
32
If there is anything that we can reasonably do to accomo-
date Mr. Parish’s desire, I am going to try to get my co-counsel
to agree with it. Up to the present time, Mr. Michie and our
firm have been in complete agreement as to what can and
should be done; I think it is quite possible that we can get
together with Mr. Parish and solve this problem in that (T. 24)
way.
I would, however, say this: I have no particular reason
either to favor or disfavor Mr. Parish’s handling his own case.
I have examined some of the authorities that have been cited.
It seems to me that there are three Maryland cases in which
the Court of Appeals has made it clear that an individual
party is entitled to handle his case in propria persona. I do
not think there is anything in any of the other cases that have
been cited that would detract from that general principle or
would eliminate it from a case which is brought as a deriva-
tive suit, which this is.
Therefore, I think that Mr. Parish - - I must say I think
that Mr. Parish has the right to represent himself. Nevertheless,
I am most anxious to get these matters worked out so we can
get on with the trial, and if it is at all possible for an agreement
to be reached between Mr. Parish which would satisfy him to
continue with Mr. Michie as his counsel, I will be happy to do
everything I can to help to work that out.
(The Court) Mr. Parish?
(Mr. Parish) Your Honor, there are two or three points,
very quickly.
Under the concept of just adding a prayer to cover this
trust problem - - and which I believe would be sustained, but
33
the decision would come last and the benefit of the t-ust
(T. 25) decision or determination needs to come first in order
to have the use, the force of it during our pre-trial discovery - -
(The Court) Mr. Parish, you have just heard what seems
to the Court a very reasoned and very reasonable and very
cooperative suggestion - -
(Mr. Parish) I will come to that, Your Honor.
(The Court) - - made by counsel with reference to this
matter. Would you address yourself to that?
(Mr. Parish) I am not ignoring it at all, but I will just
take it in the order in which the things came.
He mentioned the Court of Appeals and my representing
myself. For at least a year before the date that Mr. Brune
suggested and we got so far apart, I brought the trust relation-
ship up for consideration; that, and not getting the Dougan
report despite the fact that we had a ruling by Judge Shook
against the protective order of denying the protective order
for depositions, July 20, 1965, we had no action whatsoever.
That is why we parted company. That is what started all
the trouble.
Mr. Shaffer undertook to represent me knowing all these
facts, and still did the same thing. Now Mr. Brune mentions
all counsel are in agreement.
On January 8, Mr. Shaffer writes Mr. Brune with respect
to this particular type of draft covered by a prayer, and I quote
paragraph two, page two. Mr. Shaffer said: “I do (T. 26) not
eT
34
think that merely amending the prayers for relief of the third
amended bill of complaint by inserting a new paragraph 4A
will accomplish any worthwhile objective, much less that Mr.
Parish has in mind.”
I would welcome this ccoperation if it can be as Mr.
Brune suggests now: an amendment to the bill of complaint,
as Your Honor also suggested to Mr. Michie. I would be very
delighted. We are on our road. And please don’t be too
impressed by talks of delay, when we have had five years,
and since July 20, 1965, we had the opportunity to take
depositions.
EEEEKEREEEE
(T. 27) (The Court) . . . So it seems inevitable that the
Court must conclude here that Mr. and Mrs. Parish, therefore,
do have the right to represent themselves.
FEEEEEEEEE
(T. 29) (The Court) . . . We want to point out that the
Court will insist that the rules of court, both the Maryland
rules and the local rules, be strictly complied with. If you do
not engage counsel, Mr. and Mrs. Parish, the Court does not
propose to lend its efforts ‘in your direction as counsel in
your behalf; nor to be subjected to requests for conferences
in chambers with reference to the manner or the method by
which certain procedures may be effected under the rules.
(T. 30) You will be limited to your own resources and
be required to conform - - this we emphasize - - to conform
in all respects to the rules of procedure and the rules of law
i)
35
generally applicable in a case of this kind. The Court will
not countenance any departure from these rules, and even if
there should not be an objection - - something which is prob-
ably contrary to fact - - we would, upon our own motion,
not receive any papers which do not conform to the rules;
and will so instruct the Clerk of the Court at the time that
any papers may be submitted for filing, if they do not con-
form to the Maryland Rules of Procedure and to the local
court rules for the Circuit Court for Montgomery County,
they will not be accepted for filing.”
This is contrary to precedent quoted in our Brief, pp. 5 and 6,
and hostile. Also, note pages 4 and 5 herein, paragraph 82,
the Court itself stated the necessity to amend for the same
reasons put forth herein.
SECOND CAUSE OF ACTION
The second cause of action stated in the Amended Com-
plaint sounds essentially in fraud. It essentially claims that
the Appellees, Maryland and Virginia Milk Producers Associ-
ation, Inc., together with its Directors, Officers and Trustees,
conspired to‘conceal with the aid of auditors and counsel,
and did conceal from its members (cestui que trust) many
major material facts, alleged in detail in paragraphs 31 through —
55 of Amended Complaint (Appendix pp. 23-37). (Appendix
to Appellants’ Brief No. 78-1079).
Evidence of the fact that Appellees were fully informed
is disclosed by paragraphs 41 thru 48 of Amended Complaint.
36
THIRD CAUSE OF ACTION
The third cause of action sounds in the nature of an
equitable action for an accounting, based on the existence
of a trust relationship and allegations that there had not been
sufficient account of proper accounting in the past.
Quoting the Federal District Court’s letter Memorandum
Order. page 3 (Appendix B - page 13.)
‘* . . A comparison of the first three causes of action
in the Amended Complaint with the extensive and detailed
Parish I and Parish II opinions shows that plaintiffs are attempt-
ing to relitigate claims that were presented and decided
adversely to them in the state proceedings...”
Petitioners repeat ‘Statement of the Case” in their brief
filed with The Fourth Circuit Court of Appeals:
Plaintiffs Amended Complaint (Docket No. 94) (Appen-
dix 2) is an independent action based upon fraud extrinsic
and also fraud, both extrinsic and intrinsic; an action to
impeach the judgment of the state court, in prior action, on
the. grounds that said judgment is blatantly unconscionable
and based upon totally unfounded conclusions.* See paragraph
81, Appendix 2 (Appendix to Appellants’ Brief No. 78-1079);
subparagraphs thereto | thru 5.
* Kauffman, et al v. McLaughlin, 114 P.2d 929
SYLLABUS BY THE COURT
2. ‘A person sustaining the relation of trustee to another
owes such other person the duty of making a full disclosure of
\
37
Said amended complaint alleges that “the ruling by the
State District Court is without any legal significance and a
complete nullity with a purpose to deprive plaintiff of his
property without due process of law” (Appendix page 16)
(Appendix to Appellants’ Brief No. 78-1079). The Circuit
Court, in said prior action, having denied petition for a
rehearing, the Court of Appeals, of Maryland having denied
footnote* (continued)
all matters appertaining to the trust. Neglect to do so to such
other’s injury, knowing or having good reason to believe that
silence will so result, is a fraudulent act, and failure of the
trustee in that regard persisted in, in a judicial proceeding,
to the prejudice of such other and advantage to himself, may
be regarded as fraud extrinsic, as well as fraud intrinsic, and
may be treated as fraud extrinsic practiced upon the Court.”
Laun, et al v. Kipp, 155 Wis. 347, 145 N.W. 183-5 ALR
655-675
The fraudulent concealment or omission of facts, by a
fiduciary, the revealing of which would have caused the entry
of the judgment in favor of the cestui que trust, is fraud which
will induce a court of equity, in an independent suit, to relieve
against a judgment or order that is unjust to the cestui que |
trust. Smith v. Smith, (1914) 210 Fed. 947, affirmed in (1915)
139 C.C.A. 465, 224 Fed. 1; Sohler v. Sohler, (1920) 135 Cal.
323, 87 Am. St. Rep. 98, 67 Pac. 282; Campbell - Kawan-
nanakoa v. Campbell (1909) 152 Cal. 201, 92 Pac. 184, Burnett
v. Milnes (1897) 148 Ind. 230, 46 N.E. 464; Bowsman vy.
Anderson (1912) 62 Or. 431, 123 Pac. 1092; rehearsing denied
in (1912) 62 Or. 444, 125 Pac. 270; Schneider v. Sellers (1900)
25 Tex. Civ. App. 226, 61 S.W. 541; the reported case (Laun v.
Kipp, ante, 655).
38
Joint Motion for Reargument - Exhibits Z-2 and Z-3 and
excerpts from Ruling (Exhibit Z-);
“Plaintiffs seek the right to submit proof that the Courts
stated basis for finding ‘that the Simon-pure relationship that
governs between cestui que trust and trustee are not necessarily
imported into the relationship that subsists between the associ-
ation and its members,’ is totally without any legal significance
and a complete nullity.” (Appendix 2, page 17) (Appendix to
Appellants’ Brief No. 78-1079).
The Complaint presents five causes of action, all joined
together as one action by paragraphs 30, 56, 60 and 70, im-
posing upon all defendants the standard of care and duty
required of a Trustee (First Cause of Action).* 4
Court failed to render Declaratory Judgment.
*A4 Atlanta Trust Co. v. National Bondholders Corp.
4 S.E. 20 644
“One who aids and assists a trustee in misapplying trust
funds, with knowledge of his misconduct, is directly account-
able to the person injured, etc.”
First Trust Co. of Lincoln v. Carlson, et al, 261 N.E. 333
4. Where the trustee has practiced concealment, evasion,
or misrepresentation depriving cestui trust of material infor-
mation relative to the subject matter of trust to his injury
and those participating in wrong, may be required to respond
in damages, etc.”
>
tl
39
Accordingly, Plaintiffs submit that the Federal District
Court’s finding, “Whether the analytical base is res judicata,
full faith and credit, or outright lack of jurisdiction, it is clear
that the Plaintiffs first Three Causes of Action must be dis-
missed.””» DO NOT APPLY TO THIS ACTION.
There is no question that “The heart of res judicata
doctrine is the policy that all litigation must sometime come
to anend..”
BUT:
Isn’t this a two edged sword? Declaratory Judgment
should have been rendered, thus putting an end to contro-
versy over the obvious fact that the relationship is that of an
express trust (the focal point in this action).
That res judicata does not apply in this case regardless of
the fraud and independent action, is presented in Appellants’
Brief to the United States Court of Appeals for the Fourth
Circuit, page 8, Argument I.
Petitioners submit that the District Court failed to respond
to Appellants’ citations re the Fourth Cause of Action in their
brief, page 12, quoted below:
“5 §702 GOVERNMENT ORGANIZATION
Page 180:
“Jurisdiction to review exlusionary rulings may be
sustained, even absent significant injury, where agency’s ruling
40
is so flagrantly wrong* and demonstrably critical as to make
it apparent that the agency is not merely courting the pos-
sibility of reversal but is running into the certainty of it if the
ultimate decision should be against the proponent of the
evidence. Conway Corp. v. Federal Power Commission, 1975,
510 F.2d 1264, 187 U.S. App. D.C. 43, certiorari granted
96 S. Ct. 355, 423 U.S. 945, 46 L. Ed. 2d 276.”
* See Page 23 of Complaint and Exhibit X, Appendices
A and B, also | thru 10 attached hereto.
Page 181:
“Although injury to plaintiff's economic well-being
constitutes injury in fact in determining whether plaintiff has
standing to challenge administrative action, other types of
injury are sufficient to meet requirements of test, including
injury to plaintiffs aesthetic or environmental well-being.
McDowell y, Schlesinger, D.C. Mo. 1975, 424 F. Supp. 221.
Person adversely affected by administrative action is
presumptively entitled to judicial review of its correctness.
Phillips v. Dawson, D.C. Ky. 1975, 393 F. Supp. 360.”
(emphasis supplied)
Page 182: :
“Right to review of agency action is usually restricted
to persons whom agency regulates or affects adversely. Robin-
son v. Pottinger, D.C. Ala. 1974, 376 F. Supp. 615.
This chapter in no way expands the cojfcept of standing
to sue; plaintiffs are still required to show that they re
- aa ies ee S .
41
aggrieved by an agency action before they can obtain judicial
review. Evans v. Lynn, D.C. N.Y. 1974, 376 F. Supp. 327.”
“Economic injury gives a person standing to seek judicial
review of administrative agency action but once review is
properly invoked that person may argue the public interest
in support of his claim that an agency has failed to comply
with its statutory mandate. Lee v. Resor, D.C. Fla. 1972,
348 F. Supp. 389.”
Federal Defendant’s Motion to Dismiss (Docket No. 99) fails
to note the 1973 Amendment.
**7 §1446. Ch. 35, page 444: (See page 6 of Motion)
1973 Amendment. Subsec. (c) Pub. L., 93-86 inserted
“of pure and wholesome milk to meet current needs, reflect
changes in the cost of production, and assure a level of farm
income adequate to maintain productive capacity sufficient
to meet anticipated future needs.”’ following “necessary
in order to assure an adequate supply .. .” (emphasis supplied)
“15 §714B-
(9) Debarment - Generally
Commodity Credit Corporation has inherent power
to terminate business relations with irresponsible, defaulting,
or dishonest contractors as necessary incidental to effective
administration of statutory scheme. Gonzles v. Freeman,
1964, 334 F.2d 570, 118 18 App. D.C. 180. (emphasis
supplied)
42
“13 JURISDICTION
District courts of United States have exclusive juris-
diction of all suits brought by or against Commodity Credit
Corporation and Federal Courts have exclusive jurisdiction
over causes of action which corporation has right to prosecute.
U.S. v. McDonald Grain & Seed Co., D.C.N.D. 1957 F. Supp.
329. Rev. on other grounds, 261 F.2d 539.”
Re the District Court’s statement, page 7, Memorandum and
Order: ‘Finally, Plaintiffs’ conclusory allegations, at best,
concern only a private conspiracy which does not fall with
the ambit of Section 1985 - - defendants Motion to Dismiss
the Fifth Cause of Action will be granted.”
Petitioners submit, as noted in their brief, page 15, “ .. .
that due to the vast number of individuals involved and the
fact that direct dealings with Government funds are involved,
this is not a private conspiracy, but rather takes the nature
of a sufficiently large conspiracy as to the public in nature.
Bearing upon this point and the fact that the issues and parties
in this action are not the same as those in the prior action,
reference is here made to Appendix 2, (Appendix to Appellants’
Brief No. 78-1079), paragraphs 84, 86 and 86A) and Exhibit
R therein (Appendix 8A), Appendix 9 being a photocopy of
the summary contained in the United States Senate Subcom-
mittees’ staff study cited in Exhibit L-1 and paragraph 88A
of Amended Complaint (Docket No. 94, Appendix 2, page
46). This bears heavily on the point of fraud in accounting
(conspiracy) national in scope and cites Appellee (Price Water-
house & Co.) (see paragraphs 49 and 50 of Appendix 2; also,
paragraphs 69B and 69C),
a ey
43
Appendix 9 of Appendix to Appellants’ Brief No. 78-1079
in the United States Court of Appeals for the Fourth Circuit
is submitted pursuant to Federal Rule 803-14, 18 and 24.
In reply to the District Court’s citation on Griffin y.
Breckenridge (page 6 of Memorandum and Order) 403 U.S.A.
102, “‘A close reading of the Complaint shows that it is totally
devoid of any hint or suggestion of a class based discriminatory
intent, e.g., that persons in a class different than Plaintiffs
received.”” (Appendix 2 herein)
Plaintiffs submit that the class distinction here is obviously
the legal establishment versus the layman (members).
REASONS FOR GRANTING THE WRIT
To ignore the time honored Judicial determinations as to
the basic legal grounds upon which Trustee’s relationships and
duties are created, is to abandon all recognition of moral and
intellectual integrity required by the judiciary and make a
mockery of the maxims “fraud vitiates everything and there
is no wrong without a remedy in equity.”
Judge Cardozo, speaking for the New York Court of
Appeals in an often quoted passage, has said: )
“Many forms of conduct permissible in a workaday
world for those acting at arm’s length, are forbidden
to those bound by fiduciary ties. A trustee is held
to something stricter than the morals of the market
place. Not honesty alone, but the punctilio of an
honor the most sensitive, is then the standard of
behavior. As to this, there has developed a tradition
44
that is unbending and inveterate. Uncompromising
rigidity has been the attitude of courts of equity
when petitoned to undermine the rule of undivided
loyalty by the ‘disintegrating erosion’ of particular
exceptions. Only thus has the level of conduct
for fiduciaries been kept at a level higher than that
troddenby the crowd. It will not consciously be
lowered by any judgment of this Court.” ;
Scott on Trusts, Section 170.25, pages 1387-1388.
In addition, it is generally accepted that government
agencies may not and should not participate in fraud against
any class of individual, let alone the public as a whole. Accord-
ingly, this Court is called upon to decide whether the fraud
alleged goes unbridled, or whether the same is redressed in
APPENDIX
the Courts.
Ee
CONCLUSION
Petitioners submit that this case presents a serious mis-
application of principles of law and accepted concepts of
justice which require a hearing that allegations made may be
fully explored.
Respectfully submitted,
—
518 E. Baltimore Street
Taneytown, Maryland 21787
Petitioners, Pro Se
1
FRANK P. PARISH, Pro Se, |
THEODORE FISHER PARISH, |
Pro Se, |
February 11, 1979
ee
ee
Zug @,
A. |
APPENDIX A
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 78-1079
Frank P. Parish, Mrs. Theodore Fisher Parish,
Appellant,
MARYLAND AND VIRGINIA MILK PRODUCERS ASSOCIA-
TION, INC.; ROBERT M. GOLDMAN, and J. ROBERT SHER-
WOOD, (as Trustees); WILLIAM B. HOOPER; WILLIAM J.
HUGHES, JR.; EARL H. BUTZ, Secretary of Agriculture;
COMMODITY CREDIT CORPORATION; EDWARD L. MER-
RIGAN; HERBERT M. BRUNE; HARRISON M. ROBERTSON,
JR.; CHARLES NORMAN SHAFFER; JAMES E. CLICK,
Secretary & Treasurer, Maryland and Virginia Milk Producers
Association, Inc.; THOMAS J. MICHIE; WAYNE KENDRICK
& COMPANY; ERNEST C. CLIFFORD; PRICE WATER-
HOUSE & CO.; DIRECTORS OF MARYLAND AND VIR-
GINIA MILK PRODUCERS ASSOCIATION, INC.; CHARLES
C. T. STULL, Director; MERHL A. ADAMS, Director;
H. LEHMAN TOMS, Director; UPTON F. GLADHILL, Direc-
tor; PAUL B. HARLAN, Director; ALTON A. WHITE, Direc-
tor; HARRY W. T. FOUCHE, Director; W. J. Hahn, Director;
HOWARD W. CLARKE, Director; J. HOMER REMSBERG;
WILLIS D. REMSBERG, Director; LESTER W. HUFF, Direc-
tor; EDWARD C. NORMAN, President and Director; GILES H.
MILLER, JR., Director; UNITED DAIRY INDUSTRY ASSN.,
AND MR. GLEN LAKE, President; AMERICAN DAIRY
ASSOCIATION, AND DIRECTORS THEREOF FROM 1963
TO PRESENT DATE; INTERSTATE MILK PRODUCER’S
A. 2
COOPERATIVE; MID-AMERICAN DAIRY ASSN., MEMBER
OF UNITED DAIRY INDUSTRY ASSOCIATION; PRO-
DUCER AGENCY OF F. O. #4, J. Homer Remsberg, Jr., and
Sara L. Remsberg and Adrian McCardell Remsberg,
Appellees.
Appeal from the United States District Court for the District
of Maryland, at Baltimore. C. Stanley Blair, District Judge.
Submitted: July 31, 1978 Decided: November 3, 1978
Before HAYNSWORTH, Chief Judge, BOREMAN, Senior
Circuit Judge, and HALL, Circuit Judge.
(Frank P. Parish and Theodore Fisher Parish, Appellants (on
brief), Pro Se; Edward L. Merrigan (on brief) Lead Attorney
for Non-Government Appellees.)
PER CURIAM:
Frank P. Parish and Theodore Fisher Parish, acting pro se,
have appealed the district court’s dismissal of their civil suit
against the United States Secretary of Agriculture, the Maryland
and Virginia Milk Producers Association, Inc., and numerous
other governmental and private entities and individuals. All
appellees have joined in a motion to summarily affirm the
lower court’s holding. After fully reviewing the record along
with other materials submitted to this Court by the parties,
we are persuaded that the district court ruled correctly with
respect to each of the five claims asserted by the Parishes in
So ieee eet ene
A. 3
their amended complaint and that the motions for summary
affirmance should be granted.
The Parishes’ suit, which was preceded by protracted
state court litigation between many of the same parties, was
based on allegedly fraudulent acts committed by the Maryland
and Virginia Milk Producers Association, Inc., and various
other appellees during a period in which the Parishes were
members of the Association. The first three claims depended
on their contention that the Parishes were involved in an
express trust relationship with the Association, which, through
directors, officers and trustees, conspired to defraud them and
other Association members and to deprive them of property
without due process of law. In addition to damages, the
Parishes sought both an accounting and a declaratory judgment
that the trust relationship in fact existed and continued to
exist despite the fact their membership in the Association
ceased in 1966.
Comparing the pleadings of these claims with two pub-
lished opinions of the Maryland Court of Appeals, the district
court found that appellants were attempting to relitigate
matters already decided in the state courts and held that
“Cw]hether the analytical base is res judicata, full faith and
credit, or outright lack of jurisdiction, it is clear that the [claims]
must be dismissed.” The Parishes now assert that the court
erred in dismissing the claims on such grounds without holding
a hearing and receiving proof that the issues raised were in fact
litigated in the state court proceedings. In support of their
position they claim that neither the district court’s opinion nor
the pleadings of any of the cases reveal that the trust relation-
ship issue was previously tried.
A.4
We cannot agree with the Parishes’ contentions. The
defense of res judicata may properly be asserted in the context
of a motion to dismiss when supported by facts apparent on
the face of the complaint. See Thomas v. Consolidation Coal
Company, 380 F.2d 69, 75 (4th Cir.), cert. denied, 389 US.
1004 (1967); Jacaponi v. New Amsterdam Casualty Company,
379 F. 2d 311 (3rd Cir. 1967), cert. denied, 389 U.S. 1054
(1968); 5 Wright and Miller, § 1357 at pp. 607-609. Here,
the Parishes’ amended compaint clearly revealed that the state
courts had ruled on the trust relationship issue. Under such
circumstances it was within the district court’s discretion to
take judicial notice of the state court opinions, portions of
which were quoted in the complaint, when certain defendants
raised the res judicata defense in preliminary motions. See
Iacaponi v. New Amsterdam Casualty Company, supra, 379
F.2d at 312.
After our own examination of the complaint and the state
court opinions, we too are persuaded that the claims should
have been barred on res judicata principles. That the trust
relationship issue was argued and decided both at trial and on
appeal in the state courts is manifestly apparent from the
Maryland Court of Appeals second published opinion. Parish
v. Maryland and Virginia Milk Producers Association, 277 A.2d
19, 21-22 nn. 1 & 2, 48 (1971). Even if the decision on appeal
was based on an incorrect application of the law, as the Parishes
contend, it did not thereby become a nullity for res judicata
purposes. See Rooker v. Fidelity Trust Company, 263 US.
413, 415-16 (1923). The proper place to challenge the trial
court’s ruling was in the Maryland Court of Appeals. When the
Parishes did so, the decision was affirmed. The correctness
of that decision cannot now be appealed to the federal courts.
aed see oo canon cee nae
ete en ela wets 1 shat mem te a oe
sai %
A. 5
Accordingly, we affirm the district court’s dismissal of the
Parishes’ first three claims on res judicata grounds.*
In their fourth claim for relief, appellants sought declara-
tory and injunctive relief against the Secretary of Agriculture
and the Commodity Credit Corporation with respect to the
issuance of federal milk price supports. The claim was dis-
missed on the basis of the district court’s ruling that appeilants
lacked standing to sue either as members of the Association or
as taxpayers and milk consumers. We fully concur with the
lower court’s reasoning and deem appellants’ arguments on
appeal to be frivolous.
The Parishes’ fifth and final claim for relief consisted of
charges that their former trial attorneys conspired to violate
appellants civil rights by failing to plead and prove property
the existence of the alleged trust relationship and to introduce
certain evidence relating to the Association’s solvency. Juris-
diction was alleged to exist under 42 U.S.C. § 1985. The
district court, in addition to dismissing the claim as being
barred by the Maryland statute of limitations, held that the
claim was not cognizable under the civil rights statute because
*The Parishes further argue that res judicata is inapplicable
because the state trial court’s judgment was tainted by fraud.
We are unable to perceive, however, why fraud at the trial
level, whether intrinsic or extrinsic, should negate the effect
of the appellate court’s legal ruling as to the absence of an
express trust relationship under the laws of Maryland. The
Parishes apparently fail to understand that the ruling on appeal
alone, right or wrong, operates to bar federal court litigation of
the same issue.
A. 6 A.7
there was no allegation of a class-based discriminatory animus APPENDIX B
and because the alleged conspiracy was merely private in |
nature.
Letter of September 15, 1977 to Mr. & Mrs. Frank Parish,
Counsel for all Defendants from C. Stanley Blair,
U.S. District Court, District of Maryland
Regardless of the statute of limitations issue, we agree
with the district court that the allegations are insufficient to
establish a cause of action under 42 U.S.C. § 1985. The
Parishes argue that the alleged conspiracy was class-based in
that it resulted ‘n the defrauding of each member in the Associ-
ation and no one else. It is not enough, however, that a class
of persons similarly situated might have been adversely affected
by the conspiracy; the conspiracy must have been actually
motivated by the class-based animus, and the animus must
have been invidiously discriminatory. See Harrison v. Brooks, i
519 F.2d 1358, 1359-60 (ist Cir. 1975). In our opinion, no
facts were alleged here that support either of these require-
ments.
UNITED STATES DISTRICT COURT
District of Maryland
Baltimore 21201
Chambers of
C. STANLEY BLAIR
United States District Judge
September 15, 1977
To: Mr. and Mrs. Frank Parish
In light of foregoing, the judgment of the district court is Counsel for all Defendants
summarily affirmed.
Re: Frank P. Parish, et al vs Maryland & Virginia
Milk Producers Ass’n, Inc., et al
* Civil No. B-75-1104
d : Dear Mr. and Mrs. Parish and Counsel:
: I have reviewed the massive file in this case and have
concluded that the matters before the court at this stage are
: solely questions of law. Since they are questions of law, I do
not see that a hearing is either necessary or desirable and,
accordingly, pursuant to Local Rule 6 of this court, I have
decided the pending motions on the basis of the motions
and memoranda in the file. A copy of my Memorandum and
Order which dismisses all of the plaintiffs’ claims is enclosed.
ET MET MCMRR TT NNN em Taner AER
A. 8
This concludes the matter in this court subject, of course,
to an appeal to the Fourth Circuit Court of Appeals in Rich-
mond, Virginia should the pro se plaintiffs choose to do so.
Very truly yours,
/s/
C. Stanley Blair
CSB:mm
Enclosure
cc: Clerk, U.S. District Court
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
FRANK P. PARISH, et al
v. ~ CIVIL NO. B-75-1104
MARYLAND AND VIR-
GINIA MILK PRODUCERS
ASSOCIATION, INC., et al
MEMORANDUM AND ORDER
The court will not attempt to recount the history of
this quixotic odyssey which threatens to become a latter day
Jarndyce v. Jarndyce.' The earlier campaigns of this crusade
1 —_C. Dickens, Bleak House (1852) (passim).
A.9
are described fully in Parish v. Maryland & Va. Milk Producers
Ass'n, 250 Md. 24, 242 A.2d 512 (1968) (Parish I), and Parish
v. Maryland & Va. Milk Producers Ass’n, 261 Md. 618, 277
A.2d 19, cert. denied, 404 U.S. 940 (1971) (Parish ID). The
amended complaint? analytically consists of three distinct
parts. The first encompasses a plethora of allegations about the
legal relationship between Maryland and Virginia Milk Producers
Association [Association] and its members. The second relates
to the level of federal milk price supports and the third con-
cerns the quality of the representation provided by the attor-
neys plaintiffs retained in the Parish I and Parish II \itigation.
In apparent recognition of the validity of defendants’ motions
to dismiss based on the lack of complete diversity between the
parties, plaintiffs abandoned diversity as the asserted basis of
jurisdiction in their amended complaint and rely instead on
numerous federal statutes as well as the general equity juris-
diction of the court. All defendants have moved to dismiss
for a variety of reasons.
2 As with many, if not most, pro se pleadings, the amended
complaint in this case is not precisely drawn. The caption to
the amended complaint names as defendants forty-six indivi-
duals, five associations, three federal employees or organiza-
tions, and two partnerships. The amended complaint which
is fifty pages long containing 114 numbered paragraphs men-
tions only thirty-one defendants by name although certain
persons enumerated in the caption are described by title or
position rather than by name.
One defendant, William J. Hughes, Jr., is apparently
deceased and neither he nor his estate has been served. Defend-
ants Goldman and Sherwood, who are named in their capacities
as executors of the Robinson estate, have moved to dismiss or
A. 10
The defendants have raised res judicata as a bar to this
action. The heart of the res judicata doctrine is the public
policy that all litigation must at sometime end and once tried,
issues which were tried or should have been tried are settled
forever, as between the parties. Baldwin v. Iowa State Traveling
Men’s Ass'n, 283 U.S. 522, 525 (1931); Beall v. Kearney &
Trecker Corp., 350 F. Supp. 978, 981 (D.Md. 1972). While
every person has the fundamental right to be heard, there is no
public policy in favor of allowing him an opportunity to raise
the same issues in a second forum. See Eisel v. Columbia
Packing Co., 181 F. Supp. 298, 301 (D.Mass. 1960).
2 (continued)
quash return of service on the ground that service was insuffi-
cient (Paper 9). Goldman’s and Sherwood’s affidavits, as well
as the affidavit of their attorney, reveal that service was effected
on Peter Mosner rather than Goldman and Sherwood. The
affidavits further indicate that Mr. Mosner was not authorized
to be an agent to accept service of process for either Goldman
or Sherwood. Plaintiffs’ response (Paper 13) to the Goldman-
Sherwood motion to dismiss does not refute or contest the
defendants’ affidavits and their motion to quash therefore will
be granted. Cf. Bricklayers’ Int’l Union v. Seymour Ruff &
Sons, Inc., 160 Md. 483, 154 A. 52, 55-56 (1931).
Defendants Toms and Miller have also moved to quash
service of process based on plaintiffs’ failure to comply with
Maryland Rules of Procedure 104(b) (2) and 107(a) (2). (Paper
15). The two rules, which apply to service by registered mail
within and outside of Maryland respectively, require that an
affidavit be filed stating first, that the summons was mailed
to the defendant and second, that they were in fact received
as evidenced by the defendant’s signature on the return receipt.
The return receipts for both Toms and Miller indicate that
persons other than the defendants were served. Plaintiffs’
————— — PF.
A. 11
A comparison of the first three causes of action in the
amended complaint with the extensive and detailed Parish J
and Parish IJ opinions shows that plaintiffs are attempting to
relitigate claims that were presented and decided adversely to
them in the state proceedings. This court sits neither as a
second chance forum for losing litigants nor as a court of
appeals reviewing decisions of state appellate courts. Whether
the analytical base is res judicata, full faith and credit, or out-
right lack of jurisdiction, it is clear that the plaintiffs’ first
three causes of action must be dismissed. Rooker v. Fidelity
2 (continued)
reply to the motion is unresponsive on this issue. (Paper 33).
The motion of Toms and Miller to quash service of process will
be granted.
Defendant Mid-America Dairymen, Inc. (incorrectly
denominated as the Mid-American Dairy Association in the
complaint) has moved to dismiss on the ground that the court
lacks personal jurisdiction over it. (Paper 27). Mid-America
asserts that it is an agricultural cooperative marketing associa-
tion incorporated in Kansas, which conducts no activities in
Maryland sufficient to bring it within the ambit of the Mary-
land long arm statute, Annotated Code of Maryland, Cts. &
Jud. Proc. Art., § 6-103 (1974). Although they argue to the
contrary (Paper 45), plaintiffs have not satisfied their burden
of alleging adequate jurisdictional facts. McNutt v. General
Motors Acceptance Corp., 298 U.S. 178, 189 (1936). Nor does
the fact that Mid-America is an alleged coconspirator oi any
consequence because plaintiffs’ conclusory allegations are
insufficient to invoke the conspiracy theory of jurisdiction.
See Leasco Data Processing Equip. Corp. v. Maxwell, 468 F.2d
1326, 1341 (2d Cir. 1972). Mid-America’s motion to dismiss
will be granted.
A. 12
Trust Co., 263 U.S. 413, 415 (1923); Tang v. Appellate Division
of N.Y. Sup. Ct. First Dept., 487 F.2d 138, 141 (2d Cir. 1973),
cert. denied, 416 U.S. 906 (1974); Resolute Ins. Co. v. North
Carolina, 397 F.2d 586, 589 (4th Cir.), cert. denied, 398 U.S.
978 (1968); 28 U.S.C. § 1738.
Res judicata, however, is not a bar to the fourth and fifth
causes of action because they were neither litigated nor could
they have been litigated in the state proceedings. Despite
plaintiffs’ assertion to the contrary, the only proper defend-
ants to the fourth cause of action are the Federal Defendants.”
The remaining defendants’ motions to dismiss the fourth
cause of action will be granted. In paragraph 66 plaintiffs
allege:
The decisions of the Secretary of Agriculture increas-
ing the milk price support level ':ve been arbitrary,
capricious, unlawful and entirely lack the support of
proper accounting reports of receipts and disburse-
ments by milk cooperatives resulting from sale and
disposition of milk and other property held in trust
as above alleged.
Plaintiffs seek an injunction prohibiting the issuance of any
milk price supports until the Maryland and Virginia Milk Pro-
ducers Association issues annual certified operating statements.
The Federal Defendants have moved to dismiss on the grounds
that the plaintiffs lack standing to challenge the Secretary’s
milk support decisions. Plaintiffs respond by quoting from
3 The Federal Defendants are the Secretary of Agriculture,
the Commodity Credit Corporation and Producer Agency of
F.O. #4.
— _ -
A. 13
paragraph 4 of the amended complaint where they allege that
this action is brought “ton their own behalf as producers of milk
consigned”’ to the Maryland and Virginia Milk Producers Asso-
ciation. Plaintiffs’ membership in the Association, however,
ceased in 1966 and they no longer have standing to bring this
action as an association member. See Armstrong v. Frostie
Co., 453 F.2d 914, 917 (4th Cir. 1971); Kenrich Corp. ».
Miller, 377 F.2d 312, 314 (3d Cir. 1967).
Although plaintiffs contend in paragraph 67 that they are
consumers of milk and taxpayers affected by the level of milk
price supports, plaintiffs have not responded to the Federal
Defendants’ assertion that they lack standing in these capacities
and indeed, they cannot. The court in Nader v, Butz, 398 F.
Supp. 398 (D.D.C. 1975), denied plaintiffs leave to file a second
amended complaint similar to the amended complaint in this
action. The court stated:
Plaintiffs would prosecute their second amended
complaint “ton their own behalf and on behalf of all
consumers of milk and milk products, and of all
taxpayers.”” But as either consumers of milk or
taxpayers, they lack standing to bring this claim.
Schlesinger v. Reservists to Stop the War, 418 U.S.
208, 94 S.Ct. 2925, 41 L.Ed.2d 706 (1974); see
United States v. Richardson, 418 U.S. 166, 94 S.Ct.
2940, 41 L.Ed.2d 678 (1974); Warth v. Seldin,
[422] U.S. [490], 95 S.Ct. 2197, 45 L.Ed.2d 343
(1975).
a Te
A. 14
398 F. Supp. at 400. The Nader holding is fully applicable to
this action and plaintiffs’ fourth cause of action will be
dismissed .*
* The Federal Defendants’ alternative ground for dismissal
is equally valid. In paragraph 65, plaintiffs allege that the
Secretary of Agriculture must consider the factors listed in
7 U.S.C. § 1421 (b) when he sets the milk price support level.
Plaintiffs fail to recognize that the nine factors apply “[e] xcept
as otherwise provided” in the Agricultural Act of 1949. Milk
price support levels are governed not by section 1421, but by
7 U.S.C. § 1446 which provides in pertinent part:
The Secretary is authorized and directed to
make available (without regard to the provisions of
title III (7 U.S.C. §§ 1447-49) price support to
producers for tung nuts, honey and milk, as follows:
(c) The price of whole milk shall be supported at
such level not in excess of 90 per centum nor less
than 75 per centum of the parity price therefor as
the Secretary determines necessary in order to
assure an adequate supply of pure and wholesome
milk to meet current needs, reflect changes in the
cost of production, and assure a level of farm income
adequate to maintain productive capacity sufficient
to meet anticipated future needs. . . .
Plaintiffs have not alleged that the Secretary of Agriculture
has abused the discretion vested in him by section 1446(c)
A. 15
Plaintiffs’ fifth cause of action alleges that the defendant
attorneys conspired to deprive the plaintiffs of their civil
rights in violation of 42 U.S.C. § 1985 by failing to allege
and prove that a trust relationship existed between the plain-
tiffs and the Association. It is apparent that this cause of action
must be dismissed for several reasons.
Assuming that plaintiffs first discovered they had been
wronged on May 5, 1971, the date Parish II was decided,
plaintiffs waited over four years before instituting this action
on August 11, 1975. The Maryland three year statute of
limitations, Annotated Code of Maryland, Cts. & Jud. Proc.
Art., § 5-101 (1974), which applies to actions brought pur-
suant to section 1985, bars plaintiffs’ fifth cause of action.
Even if the allegations were timely filed, they would never—
theless be dismissed because plaintiffs have failed to satisfy the
standard enunciated in Griffin v. Breckenridge, 403 U.S. 88
(1971). There the Court stated:
The language requiring intent to deprive of equal
protection, or equal privileges and immunities, means
there must be some racial, or perhaps otherwise
class-based invidiously discriminatory animus behind
the conspirators’ action.
4 (continued)
and therefore have failed to state a cause of action whether
or not they have standing. See United States v. Swift & Co.,
(4th Cir., cert. denied, 358 U.S. 837 (1958).
A. 16
403 U.S. at 102 (emphasis original). A close reading of the
complaint shows that it is totally devoid of any hint or sugges-
tion of class-based discriminatory intent, e.g., that persons in
a class different than plaintiffs’ would have been accorded
treatment different from that plaintiffs received. Hence no
cause of action is stated. Stephens v. City of Plano, 375 F.
Supp. 985, 987-88 (E.D.Tex. 1974); Brosten v. Scheeler, 360
F. Supp. 608, 614 (N.D.Ill. 1973), aff'd, 495 F.2d 1375 (7th
Cir. 1975). Finally, plaintiffs’ conclusory allegations, at best,
concern only a private conspiracy which does not fall within
the ambit of section 1985. Doski v. M. Goldseker Co., 539
F.2d 1326, 1334-35 (4th Cir.. 1976). Defendants’ motions to
dismiss the fifth cause of action will be granted.
Several of the non-federal defendants have moved for the
award of costs. Federal Rule of Civil Procedure 54 (d) author-
izes that costs be allowed as a matter of course to prevailing
parties. Under the American Rule “governing the award of
attomeys’ fees in litigation in the federal courts . . . attorneys’
fees ‘are not ordinarily recoverable in the absence of a statute
or enforceable contract providing therefor’ ” F.D. Rich Co. v.
Industrial Lumber Co., 417 U.S. 116, 126 (1974). An except-
ion to the American Rule, however, permits the award of
attorneys’ fees to the prevailing party when the losing party
has “acted in bad faith, vexatiously, wantonly or for oppres-
sive reasons.” Alyeska Pipeline Co. v. Wilderness Soc’y, 421
U.S. 240, 258-59 (1975); F.D. Rich Co. v. Industrial Lumber
Co., 417 U.S. at 129.
The court is required by Haines v. Kerner, 404 U.S. 519
(1972), to give pro se complaints a liberal construction. Under
that standard the court concludes that plaintiffs’ conduct has
not been sufficiently egregious so as to justify the award of
attorneys’ fees as part of the defendants’ costs. As discussed
™
A. 17
supra, plaintiffs are barred from the further relitigation of the
claims found in the first three causes of action, notwithstanding
plaintiffs’ desire that this court declare the Parish IJ decision to
be “totally without legal significance and a complete nullity.”
In addition, plaintiffs’ conspiracy claims found in the fifth
cause of action are patently frivolous. Plaintiffs therefore are
put on notice that any further attempt‘ to litigate the claims
in the first, second, third, and fifth causes of action may result
in the assessment of costs, including attorneys’ fees, by any
court having jurisdiction over the parties because such reliti-
gation would be in bad faith or for purposes of harassment.
4 — This is the fourth action brought by the plaintiffs against
the Maryland and Virginia Milk Producers Association. Plain-
tiffs’ original suit against the Association was filed in the
Circuit Court for Baltimore County, Maryland on January 24,
1965 and was dismissed on February 8, 1965. Parish v. Mary-
land & Va. Milk Producers Ass’n, Inc., Equity No. 54599
78/19 (Baltimore County, Md. Cir. Ct.). In the interim, plain-
tiffs filed Parish v. Maryland & Va. Milk Producers Ass’n, Inc.,
Equity No. 29,524 (Montgomery County, Md. Cir. Ct.) on
February 4, 1965. The full history of that case can be found
in the Parish I and Parish II opinions cited earlier. On August 8,
1973 plaintiffs filed suit in the Circuit Court for Frederick
County, Maryland. That action was dismissed without pre-
judice on November 13, 1973. Parish v. Maryland & Va. Milk
Producers Ass’n, Inc., Equity No. 24,465 (Frederick County,
Md. Cir. Ct.). This suit was instituted August 11, 1975.
A. 18 A. 19
Accordingly, it is this 15th day of September, 1977, : phos ng
ORDERED that plaintiffs’ claims be, and hereby are, DIS- .
Milk Price Below Average
MISSED. 3 Production Per 100 Pounds of 4 Previous Loss Revenue
/s/ Year Gal.PerDay of 3.5% (Fat) Milk Years to Producers
C. Stanley Blair 1950 =—-:152,181 $5.05
United States District Judge 1951 161,055 5.72
1952 168,938 5.92
APPENDIX 1 1953 190,004 5.46
=$22.15+4
IN THE UNITED STATES DISTRICT COURT | Aver. 5.53 $5.53
FOR THE DISTRICT OF MARYLAND 1954 198,390 5.17 36 $2,174,108.
1955 208,314 5.07 46 2,916,992.
FRANK P. PARISH, et al 1956 224,311 5.03 50 3,414,126.
| 1957 232,873 5.09 44 3,119,110.
v. : CIVIL NO. B-75-1104 1958 230,824 5.06 AT 3,302,461.
1959 240,983 4.84 69 5,061,677.
eal i er 1960 243,717 4.89 64 4,748,153.
DUCERBASSOCIATION. 1961 248,043 4.79 74 5,587,501.
INC.. et al ; 1962 246,232 4.65 88 6,596,082.
1963 244,737 4.61 92 6,854,035.
eeeeeneees | 1964 237,995 4.78 75 5,433,604.
1965 233,688 4.93 60 4,268,218.
WHAT BECAME OF ALL THE GREAT PROFITS
TO PRODUCERS? PLAINTIFFS ALLEGE THAT Employment Terminated (Hooper & Robinson) - (Parish Suit -
THE PRICE TO PRODUCERS WAS REDUCED Filed 1965)
YEARLY AS NOTED BELOW; THE RETAIL *
INCREASED WHILE PRICE PAID TO FARMERS, Members Loss of Revenue prior to Hooper,
DECREASED: Robinson Employment Termination and Parish,
, et al., litigation $53,476,067.
(1954-1966) |
Reduction m Fsice Paid 1966 229,425 5.51 02 139,678.
Producers from 1950-1967 1967 235,335 5.84 (Gain) +.31 $2,220,788
* See Exhibit X to Appendix to Appellants’ Complaint.
(The highest price paid in 15 years.)
A. 20
Plaintiffs have multiplied the cwt of milk produced
each year by the drop in price per cwt to arrive at
the reduced income to producers of $53,476,067.
during the years 1954 to 1965, as detailed above.
APPENDIX 2
EXHIBIT H
MARYLAND AND VIRGINIA MILK PRODUCERS
ASSN. INC. JOINT MEETING OF FINANCE
AND EXECUTIVE COMMITTEES
October 20, 1964
A joint meeting of the Finance and Executive Committees
of the Board of Directors was held at the offices of the Associa-
tion located at 1530 Wilson Boulevard, Arlington, Virginia,
on Tuesday, October 20, 1964.
There were present,
Directors:
Edward C. Norman
Luther L. Day
+ Charles C. T. Stull
Merhl A. Adams
H. Lehman Toms
C. Thomas Sollenberger
Upton F. Gladhill
Paul B. Harlan
Giles H. Miller, Jr.
Wm. C. Crossman, Jr.
A. 21
with Mr. Van Metre absent.
Also Secretary-Treasurer: James E. Click
Assistant Secretary: Paul H. Snyder
Comptroller: J. W. Marshall, Jr.
Tax Attorney: Leonard Silverstein
Mr. Norman, President of the Association, presided and
Mr. Snyder acted as secretary of the meeting which was called
to order at 1:30 p.m.
Mr. Click and Mr. Snyder reviewed with the Committees
the current status of the Association’s Revolving Fund in
relation to the outstanding Capital Revolving Fund Certifi-
cates, pointing out that certificates outstanding are in excess
of the Revolving Fund and the primary reason for the differ-
ence is the effect of the discount on the Embassy Dairy note.
Mr. Silverstein suggested to the Committee several ways to
make up the deficit as follows:
1) At the time of redemption, certificates would be
redeemed at less than 100% of face value.
2) Sell land at the Manufacturing Division at a gain and
pay tax on same.
3) Withhold a portion of current year’s earnings over a
period of 10 or 12 years and pay tax on same.
4) Continue to spread the deficit over all years in the
Reserve.
A. 22
5) Book write-up of Class C Stock of Baltimore Bank
for Cooperatives and Patronage Dividends of Valley
of Virginia Milk Producers now on Association’s
books at $1.00.
After considerable discussion by the committees, upon
motion of Mr. Miller, seconded by Mr. Sollenberger, the next
Finance Committee meeting was scheduled for 9:00 a.m. on
Friday, November 13, and another joint meeting of the Finance
and Executive Committees at 11:00 a.m. on Friday, November
13, to again consider the matter of the Revolving Fund Certifi-
cate over-write and the Association’s auditors, Price Waterhouse,
be asked to attend if it was felt necessary.
Mr. Marshall reviewed with the committees the methods
available for pricing milk delivered to the Marva Maid Divisicn
and the effects of each. In conjunction with this presentation,
Mr. Marshall also presented a cash projection through 1964.
In view of the presentations made, the committees dis-
cussed at length the advisability of redeeming the Non-Interest
Series 1958 Capital Revolving Fund Certificates.
After carefvl consideration, upon motion of Mr. Miller,
seconded by Mr. Crossman, it was recommended to the Board
that no change be made in the decision not to redeem the
non-interest Series 1958 Capital Revolving Fund Certificates.
Upon motion of Mr. Day, seconded by Mr. Adams, the
meeting adjourned at 4:30 p.m.
/s/
Edward C. Norman
President
/s/
Paul H. Snyder
Assistant Secretary
et
A. 23
APPENDIX 3
EXHIBIT M
EDITORIAL COMMENT
MUST THE PHILADELPHIA HANDLER
POOL BE DISCARDED?
HOARDS DAIRYMAN
JULY 10, 1965
As this is written, dairy leaders in the eastern part of the
country are submitting evidence on the proposed termination
of the Delaware Valley federal milk marketing order. The
U. S. Department of Agriculture has indicated it is considering
dropping the order which sets minimum prices for dairymen
shipping milk to handlers in Philadelphia, Wilmington, and the
southern New Jersey area.
According to the official USDA notice, here is the picture
in the order:
“Audits of the records of various cooperative associations
and proprietary handlers and other investigation have revealed
widespread practices resulting in the undercutting of the estab-
lished minimum order prices. ~ Further, efforts appear to have
been made to conceal the true nature of the transactions by:
The maintenance of incomplete or dual records; the establish-
ment of dummy corporations and the use of third party inter-
mediaries; the establishment of special accounts through which
A. 24
payments for alleged services are made; payments in the guise
of brokerage fees, all or part of which eventually accrue to the
proprietary handler or persons intimately associated with such
handler, and by other intricate and devious means. To the
extent possible in the circumstances, all available legal pro-
cedures will be pursued in an effort to enforce the existing
order as to any past or current violations.”
The incentive for financial skulduggery may be found in
the difference between the April Class I price of $5.40 in
Philadelphia and the New York-New Jersey order blend price
of $3.80 at country plants no more than 70 miles from Phila-
delphia.
We are not advised of the exact nature of the “violations”
in the Delaware Valley order but we have received several
reports from knowledgeable persons indicating a messy situa-
tion has developed. Further, some cooperatives have been
playing in the mud, too.
The market has an individual handler pool. Thus, it has
been able to maintain a high Class I utilization with corres-
ponding high prices to its fermers. But neighboring marketwide
pools charge that they are carrying reserves for the Delaware
Valley order. Various charges and countercharges have been
tossed around. For example, one report has it that New York-
New Jersey producers are taking 5.5 cents less in their blend
price because of five years of producers switching markets.
On the other hand, a Delaware Valley cooperative official
predicts a drop of 50 cents to his producers should the order
go out. We cannot verify any of these estimates. They do
indicate what is at stake, however.
A. 25
Our concern has to do with what appears to be a definite
war of attrition going on against handler pools. Personally,
we carry no brief or grief for handler pools. We do know
that they have served their own producers well. True, they
may not carry enough of their own reserves but we believe
this argument often has been overstated. We cannot blame
marketwide pools for wanting to have the handler pools merged
with theirs. But look at the low Class I utilization mess most
of these markets are in! It becomes a matter not of sharing
wealth but of sharing poverty.
If the marketwide pools could use Class I bases and get
their markets in decent shape, the merger of pools would not
bring economic hardship to handler pool producers. As it is
now, we see only a grave injustice to these farmers.
USDA says the present situation in the Delaware Valley
order results in “almost insurmountable administrative dif-
ficulties.” This indicates one of two things: Either USDA
cannot enforce the law . . . or the law is inadequate to proper
enforcement. For the first there is no valid excuse. For the
latter, let USDA ask for remedial legislation in the Marketing
Agreements Act which authorizes federal milk orders.
We simply cannot see the logic of burning down the
house to get to a few vermin who happen to have infested it.
A. 26
APPENDIX 4
EXHIBIT M-1
EDITORIAL COMMENT
DAIRYMEN AND THE BIGGEST “RELIEF” PROJECT
IN HISTORY
HOARDS DAIRYMAN
JANUARY 25, 1971
When the government gets around to setting the milk
price support level this year, and, if it gives further consider-
ation to the use of an economic formula for pricing Class I
milk, it would be well for the decision-makers to look at the
overall picture andwhat dairymen have undergone in the past.
A case in point is the dramatic developments of the
1950’s. Here are some of the highlights:
In 1952, dairymen marketed 98 billion pounds of milk,
for which they recieved $4.6 billion.
In 1959, they sold 112 billion pounds and still received
only $4.6 billion.
Thus, for 14 billion more pounds of milk, dairy farmers
did not receive one cent more.
A. 27
Since it takes 557 pounds of milk to provide the average
person all the milk, butter, cheese and other dairy products
he now consumes each year, the additional milk marketed in
1959 would provide 25 million people with all their dairy
products for a year.
Putting it another way, we provided enough extra milk
“for free’ to supply all the people in 15 of our largest cities.
They are: New York City, Chicago, Los Angeles, San Fran-~
cisco, Detroit, Kansas City, St. Louis, Boston, Philadelphia,
Baltimore, Cleveland, Columbus, Houston, Dallas, and Atlanta.
If the extra milk marketed in 1959 had brought farmers
the 1952 price, it would have meant $693 million more for
dairymen. This was our “relief’’ project for the “poor” con-
sumers, whose per capita income boomed 25 percent over the
seven-year period!
A. 28
APPENDIX 5
EXHIBIT N-1
Inter-State Milk Producers’
Cooperative
1225 Industrial Highway
Southampton, PA 18966
October 17, 1974
Mr. Frank P. Parish
Route 1
Taneytown, MD 21787
Dear Mr. Parish:
Your request for information on payments to Atlantic Dairy
Association from Maryland and Virginia Milk Producers Asso-
ciation, Inc. arrived while I was in Chicago testifying for a
Class I price increase for dairy farmers.
I do not have the information for two reasons; first, the offices
of the Atlantic Dairy Association were closed during 1972
and the files have been permanently retired. There is no clerical
help available to reactivate these files; second, during the years
1968, 69 and 72 Maryland and Virginia Milk Producers Asso-
ciation may have had additional local advertising programs with
the American Dairy Association in addition to the payments
made to Atlantic Dairy Association to the extent that sych
monies were paid but the records of Atlantic Dairy Association
A. 29
would be inadequate as a representation of the money paid
to the American Dairy Association.
During the year 1973 there were no payments to American
Dairy Association of Atlantic from Maryland and Virginia
Milk Producers Association.
I am sorry that I cannot be of more help to you in this matter.
Sincerely yours,
INTER-STATE MILK
PRODUCERS’ COOPERATIVE
Paul E. Hand
Asst. Gen. Manager
and Assistant Secretary
PEH:MS
CC: Mr. James E. Click
CC. Mr. Alden R. Grimes
A. 30
APPENDIX 6
EXHIBIT N-2
Smathers, Merrigan & Herlong
Attorneys and Counsellors at Law
888 Seventeenth Street, N.W.
Washington, D.C. 20006
Telephone 202-785-5300
Cable Address: Smathers
June 6, 1975
Mr. Frank P. Parish
Route |
Taneytown, Maryland 21787
Dear Mr. Parish:
Your letter of May 23, 1975 addressed to Mr. Walter A.
Martz, President of Maryland and Virginia Milk Producers
Association, Inc., has been referred to me for reply.
As I advised you on August 6, 1974, the Association
does not intend to make available any further documents or
information to aid you in the preparation of another spurious
complaint against the Association. Your membership in the
Association terminated several years ago, and as mentioned
in my letter of August 6, 1974, you are well aware of the
fact that four different courts in Maryland, including the
Court of Appeals, have already dismissed your complaints
against the Association as baseless and unsustainable.
A. 31
Regarding the sheet forwarded with your letter of May 23
entitled “‘List of Payments Made For Which There Has Been
No Accounting,” please permit me to caution you that the
Association has never made any contributions to any so-called
“Dairy Counsel,” and nothing paid to the American Dairy
Association or to any other person, group or corporation
has involved, directly or indirectly, “‘monies paid for politi-
“cal protection and favors” or for any similar unlawful or
improper purpose.
Consequently, I want to reiterate that if you proceed
to file still another groundless suit against the Association
or against any of its officers, directors, attorneys or employees,
we intend to hold you and any other persons who join in such
complaint personally responsible for any damages, losses or
court costs incurred as a result.
Very truly yours,
Edward L. Merrigan
General Counsel,
Maryland and Virginia Milk
‘ Producers Association, Inc.
ELM/ct
cc: Mr. Walter A. Martz
Mr. James E. Click
A. 32
APPENDIX 7
EXHIBIT N-3
American Dairy Association
6300 North River Road
Rosemont, Illinois 60018
Telephone 312-696-1880
October 2, 1974
Mr. Frank P. Parish
Route |
Taneytown, Maryland 21787
Dear Mr. Parish:
In response to your letter requesting investment figures for
four years, I’m embarrassed to find that we don’t have the
specific information that you wish.
The monies paid to American Dairy Association directly and,
more recently, through United Dairy Industry Association
have come from the Atlantic Dairy Association (American
Dairy Association of Atlantic) and the producer agency of
Federal Order No. 4. While we know that we have received
funds from Maryland & Virginia Milk Producers through the
above groups, we do not have any breakdown to show what
portion of such funds came from MVMPA. While the regional
organization now bears our name, it is an indpendent cor-
poration so that we have no legal basis for examining its
records.
A. 33
Inasmuch as the Federal Order is subject to USDA audit, it
shouldn’t be a problem to get figures since formation of the
Order. On those funds and those of Atlantic, you can perhaps
get the data you need from Dr. Paul Hand, Interstate Milk
Producers Coop., 1225 Industrial Blvd. Southampton, Penn-
sylvania 18966.
Sorry that I couldn’t be of direct assistance as I’d anticipated,
but I’m sure that Dr. Hand will cooperate in any way he can.
Sincerely,
Alden R. Grimes
Executive Vice President
ARG:Im
APPENDIX 8
EXHIBIT Q
3534 SCOTT ON TRUSTS § 495 .
We have considered elsewhere the principles which are
applicable in the case of express trustees.‘
§ 495. ‘See §§ 170-170.25
A. 34
APPENDIX 9
EXHIBIT W
MARYLAND AND VIRGINIA MILK PRODUCERS
ASSOCIATION, INC.
JOINT MEETING OF FINANCE AND EXECUTIVE
COMMITTEES
November 13, 1964
A joint meeting of the Finance and Executive Committees
of the Board of Directors was held at the offices of the Associ-
ation located at 1530 Wilson Boulevard, Arlington, Virginia,
on Friday, November 13, 1964.
There were present,
Directors:
Edward C. Norman, President
Upton F. Gladhill
Paul B. Harlan
Giles H. Miller, Jr.
I.D. Van Metre
Wm. C. Crossman, Jr.
Luther L. Day
Charles C. T. Stull
Merhl A. Adams
H. Lehman Toms
C. Thomas Sollenberger
A. 35
c-
Also Secretary-Treasurer: James E. Click
Assistant Secretary: Paul H. Snyder
Comptroller: John W. Marshall, Jr.
The meeting was called to order at 11:10 a.m., by the
President, Mr. Norman, and Mr. Snyder acted as secretary of
the meeting.
Mr. Click reviewed with the committee the discussion
and alternatives offered at the joint meeting of the com
mitees on October 20 in connection with ihe amount of
Certificates written over the amount in the Revolving Fund.
Mr. Click advised that after further consideration by
the staff and Mr. Silverstein, he recommended that no definite
action be taken until after December 31, 1964. He stated
that it was also felt that the only two alternatives to consider
should be to sell land at Laurel at a gain or withhold a portion
of current year’s earnings over a period of 10 or 12 years and
pay tax on same.
It was the feeling of the committee that Mr. Click’s rec-
ommendation be followed.
Mr. Click also advised that the matter of patronage ©
dividends from the Baltimore Bank for Cooperatives and the
Valley of Virginia Milk Producers was discussed with Mr.
Silverstein in view of the uncertainty of redemption. He
reported that consideration was being given to the issuance
of a separate allocation to producers for these amounts only
and advice given that redemption would not be made until
the Association receives the funds from the Baltimore Bank
for Cooperatives and from the Valley of Virginia Milk Pro-
ducers.
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.