§ 7-56-714 — Grounds for judicial dissolution

Colorado § 7-56-714

• Jurisdiction: Colorado
• Title 07: Corporations
• Art.: Cooperatives

Text

(1) A cooperative may be
dissolved in a proceeding brought in court by the attorney general if it is
established that:

(a) The cooperative obtained its organization through fraud; or

(b) The cooperative has exceeded or abused the authority conferred upon it
by law.

(2) A cooperative may be dissolved in a proceeding brought in court by not
less than ten percent of the total number of members if it is established that:

(a) The directors are deadlocked in the management of the cooperative's
affairs, the members are unable to break the deadlock, and irreparable injury to the
cooperative is threatened or suffered, or the business and affairs of the cooperative
can no longer be conducted to the advantage of the members generally;

(b) The directors or those in control of the cooperative have acted, are
acting, or will act in a manner that is illegal, oppressive, or fraudulent; or

(c) The members are deadlocked in voting power and have failed for a period
that includes at least two consecutive annual meeting dates, to elect successors to
directors whose terms have expired or would have expired upon the election of
their successors.

(3) A cooperative may be dissolved in a proceeding brought in court by a
creditor if it is established that:

(a) A creditor's claim has been reduced to judgment, the execution on the
judgment has been returned unsatisfied, and the cooperative is insolvent; or

(b) The cooperative is insolvent and the cooperative has admitted in writing
that a creditor's claim is due and owing.

(4) (a) If a cooperative has been dissolved by voluntary action taken under
sections 7-56-701 to 7-56-705:

(I) The cooperative may bring a proceeding in court to wind up and liquidate
its business and affairs under judicial supervision in accordance with section 7-56-716; or

(II) The attorney general, a member, or a creditor, as the case may be, may
bring a proceeding in court to wind up and liquidate the business and affairs of the
cooperative under judicial supervision in accordance with section 7-56-716, upon
establishing the grounds set forth for such person, respectively, in subsections (1)
to (3) of this section.

(b) As used in sections 7-56-715 to 7-56-717, a proceeding to dissolve the
cooperative includes a proceeding brought under this subsection (4), and a decree
of dissolution includes an order of court entered in a proceeding under this
subsection (4) that directs that the business and affairs of a cooperative be wound
up and liquidated under judicial supervision.

Legislative History

Source: L. 96: Entire article R&RE, p. 531, � 1, effective July 1. L. 2003: IP(4)(a) amended, p. 2234, � 106, effective July 1, 2004. L. 2004: (4)(b) amended, p. 1420, � 64, effective July 1. L. 2005: IP(4)(a) amended, p. 1218, � 27, effective October 1. L. 2006: IP(4)(a) amended, p. 849, � 6, effective July 1.