DICKEY v. RAISIN PRORATION ZONE NO ET AL (1943)

This is an appeal from a judgment restraining defendants from transferring or disposing of funds derived from the sale of raisins in a surplus commodity pool and ordering Commodity Credit Corporation to pay to plaintiff, and those growers of raisin grapes occupying a similar position with him, the sum of $145,166.04 after deducting attorneys fees and other expenses of suit.

The judgment followed the granting of a motion to strike considerable portions of the answers of Commodity Credit Corporation and of other answering defendants, and a motion for judgment on the pleadings. This necessitates a rather careful examination of the pleadings of the parties.

To properly understand the pleadings a brief summary of the purposes of the Agricultural Proration Act of 1933, Stats. 1933, p. 1969, as amended, seems advisable.

The act contains a legislative declaration of its purpose which is to prevent agricultural waste by removing from the competitive market the surplus of an agricultural product which can not be marketed profitably in the usual channels of trade, and also a declaration that the act was passed under the police powers of the State to promote the general welfare.

It provides for an Agricultural Prorate Commission of the State, its members to be appointed by the Governer, by and with the consent and approval of the Senate. This Commission is given power to permit the organization of Proration Zones in which the marketing of a particular agricultural commodity may be regulated. Each Zone must have a Proration Program Committee which, after a hearing before a duly called meeting of the agriculturists in the Zone affected thereby, may propose and adopt a marketing program for the commodity, the marketing of which is to be regulated. The marketing program cannot go into effect until approved by the Agricultural Prorate Commission. After its adoption it becomes binding on every producer of the commodity in the Zone and must be followed by all of them. Penalties are provided for any disobedience.

Speaking very generally, the program should determine the total of the regulated commodity to be produced in a crop year, the percentage of that total that can be marketed profitably in the usual and ordinary channels of trade, and the percentage that cannot be so marketed without flooding the market and breaking the market price. The percentage of the commodity that can be absorbed by the market is left under the free control of the producers who may market and dispose of that proportion of their crops as they please without any restrictions. As the subject of the proration program in this case is sun–dried, or partly sun–dried, raisins we will refer to this portion of the crop as free raisins. The balance of the crop that cannot be absorbed in the usual channels of trade is designated as surplus which must be delivered to the Proration Program Committee of the Zone and put into what is called a stabilization pool, and must be held, cared for and disposed of by that committee so that it will not be marketed or disposed of in competition with the portion of the crop designated as free raisins. It will be necessary to consider in considerable detail the powers of the Proration Program Committee in connection with the disposition of surplus raisins in the stabilization pool in a subsequent part of this opinion.

With this brief explanation of the purposes of the Agricultural Proration Act, and the machinery set up to carry out those purposes, we may proceed to a consideration of the pleadings of the parties.

The complaint was filed on March 14, 1940. The events leading up to the cause of action occurred in 1938 and 1939, so references made to statutes will be to those laws in effect at that time, unless otherwise indicated.

Sun–Maid Raisin Growers of California, a corporation, was originally joined as a defendant, but the action was dismissed as to it so no further reference need be made to it.

Paragraphs 1 to 5, inclusive, of the complaint allege that Raisin Prorate Zone No. 1 (hereinafter called the Zone) was established and organized under the provisions of the Agricultural Proration Act, Stats. 1933, p. 1969, as amended; that it included the producers of raisins in Fresno, Kings, Kern, Tulare and other adjacent counties; that certain named persons comprise the membership of the Proration Program Committee of the Zone; that Raisin Proration Association is a corporation organized under the laws of California; that the members of the Proration Program Committee of the Zone compose its board of directors; that Commodity Credit Corporation is a corporation organized under the laws of the United States for the purpose of making commodity loans and other financing.

Paragraph six alleges that, in September, 1938, pursuant to provisions of the Agricultural Proration Act, the Proration Program Committee of the Zone adopted a program for raisins for the 1938–1939 marketing season, which required the producers of raisins in the Zone to deliver twenty per cent of their raisins to the Zone to constitute a stabilization pool of surplus raisins to be withheld from the usual channels of trade and commerce in competition with the balance of the raisin crop which we will call the free raisins.

Paragraph seven alleges that plaintiff was a grower and producer of raisins in the Zone and delivered approximately thirty–five tons of raisins, which represented twenty per cent of his crop, to the stabilization pool as his surplus raisins; that other growers of raisins in the Zone delivered into the stabilization pool about fifty–two thousand tons of surplus raisins.

Paragraph nine alleges that the Zone has raisins delivered into the stabilization pool by the various growers have been commingled; that plaintiff and the other growers contributing surplus raisins to the stabilization pool are beneficial owners of those raisins and of any funds derived from the sale thereof which were held in trust by the Proration Program Committee as trustee.

Paragraph nine alleges that the zone has delivered the surplus raisins composing the stabilization pool into various warehouses and that Raisin Proration Association and other named defendants, as agents of the Zone, are in possession of parts of them and of funds derived from sales.

Paragraph ten alleges that Raisin Proration Association, the Zone, and other defendants negotiated a loan by Commodity Credit Corporation to such producers of raisins in the Zone who desired to make loans of $50 per ton on free raisins; that various producers of raisins in the Zone secured such loans from Commodity Credit Corporation in amounts that exceeded the total sum of $500,000.

Paragraph eleven alleges, on information and belief, that Raisin Proration Association and its board of directors, and the Zone and its Proration Program Committee purported and attempted to pledge to Commodity Credit Corporation all of the raisins in the stabilization pool as security for the loans made to the various producers of raisins in the Zone; that plaintiff did not consent to, approve of, or ratify such pledge; that it was not consented to, authorized or ratified by plaintiff's co–owners of the raisins in the stabilization pool; that plaintiff borrowed no money from Commodity Credit Corporation or from any other defendant and has neither pledged nor hypothecated any of his raisins in the stabilization pool.

Paragraph twelve alleges that Commodity Credit Corporation claims the right to hold all of the raisins placed in the stabilization pool, by reason of the pledge, to secure repayment of the loans made by it to the various raisin growers; that the other defendants acquiesced in that claim and unless enjoined will co–operate with Commodity Credit Corporation in holding such raisins and the proceeds from their sale as security for the loans to the individual growers; that the Zone has caused a portion of the stabilization pool raisins to be sold and the proceeds to be paid to Commodity Credit Corporation to apply on the loans made to individual growers; that contracts for the sale of other raisins in the stabilization pool have been made and that the proceeds will be paid over to Commodity Credit Corporation unless defendants are enjoined from so doing; that the raisins remaining in the stabilization pool amount to more than ten thousand tons; that large balances remain unpaid on the loans to the individual growers and cannot be paid even by the sale of all the raisins, including those in the stabilization pool, as the loans to the individual growers were made “without recourse”.

We quote paragraph thirteen of the complaint as follows: “That plaintiff brings this action for and in behalf of himself and all of his co–owners of said Stabilization Pool similarly situated, to protect and conserve the raisins, funds, and other assets of said pool against the aforementioned threatened and illegal acts of the said defendants aforementioned; that the total value of the raisins and other assets comprising said pool was, and is, largely in excess of one hundred thousand dollars ($100,000); that it is necessary, and meet and proper, for plaintiff to bring this action to protect said pool and its said assets, because the officers and agents thereof have failed to do so, and will not do so, but to the contrary intend to, and will, unless enjoined, fully cooperate with the defendant Commodity Loan Corporation in its aforementioned illegal and unauthorized effort and plan to deprive plaintiff and the other beneficial owners of said pool of their property and rights as aforesaid.”

The answer of Commodity Credit Corporation admitted the allegations of paragraphs one to five, inclusive, of the complaint and added the allegations that Raisin Proration Association is a nonprofit corporation and that Commodity Credit Corporation is an instrumentality and agency of the United States organized under the laws of Delaware pursuant to an Executive Order of the President; that the direction and management of its affairs are under the general direction of the Secretary of Agriculture.

The allegations of paragraph six of the complaint were denied except that it was admitted that on September 12, 1938, the Zone adopted a proration program for raisins grown within its boundaries. A copy of the resolution establishing the program is attached to the answer. That program does not differ materially from the summary of it contained in the complaint.

The allegations of paragraph seven of the complaint are denied except that it is admitted that “Dickey Properties”, the name under which plaintiff transacted his business, delivered not to exceed twenty tons of raisins into the stabilization pool; that all of the producers of raisins in the Zone delivered approximately 52,004 tons of raisins into that pool.

Defendants denied the allegations of paragraph eight of the complaint but admitted that the majority of the raisins were commingled in October and November, 1939, when they were sold and that a small portion was “dumped” in March of that year. It was alleged that the members of the Proration Program Committee did not act as trustees for the growers in taking possession of the raisins in the stabilization pool.

The allegations of paragraph nine of the complaint were denied, but it was admitted that on or about October 15, 1938, an agreement was entered into by Commodity Credit Corporation and the Program Committee of the Zone and Raisin Proration Association under the terms of which all raisins in the stabilization pool were pledged to Commodity Credit Corporation. A copy of the agreement was attached to the pleading. It was there recited that the Proration Program Committee proposed to deliver to Raisin Proration Association all of the raisins in the stabilization pool; that Raisin Proration Association will pledge those raisins to Commodity Credit Corporation “as additional collateral to all loans made or purchased by Commodity upon the security of raisins of the 1938 crops”. The resolution of the Zone, adopted September 12, 1938, establishing the market program, did not disclose nor contain any reference to the plan of having the Commodity Credit Corporation furnish funds for loans to the raisin growers to the amount of $50.00 per ton on the free raisins, nor was there any intimation in it that the stabilization pool raisins were to be pledged to Commodity Credit Corporation as security for these loans to individual raisin growers. The same is true of the contract of October 15, 1938, with the exception that it contained the following: “Whereas, Commodity (Credit Corporation) has authorized loans upon the security of raisins of the 1938 crop in accordance with a certain resolution approved by Commodity under date of September 24th, 1938, which shall be considered as a part thereof; * * *.” In this resolution it was disclosed that Commodity Credit Corporation proposed to loan individual growers, through Raisin Proration Association, $50 per ton on their free raisins and take as partial security for those loans a pledge of each grower's free raisins and also a pledge of all raisins in the stabilization pool as additional security for the total of the loans. We will have occasion to advert to other provisions of this resolution in a subsequent portion of this opinion.

It was also alleged that plaintiff, and all the other raisin growers in the Zone, consented to, acquiesced in and ratified such agreement and pledge.

The allegations of paragraph ten of the complaint are not denied. Therefore it must be accepted as an admitted fact that the Zone, in conjunction with Raisin Proration Association, a non–profit California corporation not organized under the Agricultural Proration Act, made the arrangement with Commodity Credit Corporation for the loans to individual growers of $50 a ton on their free raisins; that these loans were made to individual growers by Commodity Credit Corporation. It elsewhere appears that these were nonrecourse loans to individual growers made through the agencies of the Reconstruction Finance Corporation and Raisin Proration Association; that all of the raisins in the stabilization pool, including the raisins of plaintiff and other non–borrowing growers, were pledged to secure the payment of the loans made by the individual borrowing growers.

The allegations of paragraph twelve of the complaint were denied, but it was alleged that Commodity Credit Corporation claimed a valid and subsisting lien on the raisins in the stabilization pool or the proceeds from their sale. It was also alleged that all of the free raisins had been sold and the proceeds properly applied; that the loans made to the individual growers had not been paid; that “there is and was at the time of the filing of the complaint also due, owing, and unpaid to this defendant a large sum of money on account of advances or loans made to the Zone and the Raisin Proration Association to defray the expenses of operating, maintaining, and handling the stabilization pool. That the balance due, owing and unpaid to this defendant, as aforesaid, exceeds the amounts obtained from the sale or disposition of both said free tonnage pool raisins and said surplus pool raisins.”

The allegations of paragraph thirteen of the complaint were denied except that it was admitted that the total value of the raisins in the stabilization pool was largely in excess of $100,000.

The answer of the Commodity Credit Corporation set forth a second, separate and further defense in which estoppel was pleaded. It set forth the due organization of the Zone which included the counties of San Joaquin, Stanislaus, Merced, Madera, Fresno, Tulare, Kings and Kern, and all growers of Thompson Seedless, Sultana and Muscat grapes therein which were cured into sundried or partly sundried raisins. It also alleged the corporate existence of Sun–Maid Raisin Growers of California and of Commodity Credit Corporation.

After setting forth some of the difficulties of the growers in disposing of the 1937 raisin crop, and the financial assistance of Commodity Credit Corporation in marketing that crop, it was alleged that on or about and prior to September 1, 1938, the Proration Program Committee of the Zone and the directors of Raisin Proration Association negotiated with Commodity Credit Corporation and applied for a loan of $9,000,000 to be made available to Raisin Proration Association, the California corporation, in the form of non–recourse loans to producers of raisins in the Zone who desired the same to aid in stabilizing the prices to be received by all producers of raisins within the Zone. It was alleged that pursuant to notice a meeting of all the growers within the Zone was called by the Agricultural Prorate Commission of California to consider amendments to and modification of the existing raisin program; that such meeting was held on September 7, 1938; “that on or about September 10, 1938, the Commission duly made its Order and Decision, approving said program as amended and modified at said hearing; that, among other things, the said program as modified and amended and as approved by the Commission authorized the pledging or hypothecation of raisins in the stabilization pool to Commodity in order to secure loans made to the Committee and the Association for the purpose of handling and storing said stabilization pool raisins, and also for the purpose of providing further security for loans or advances proposed to be made to such producers as desired same.”

It was further alleged that on September 12, 1938, the Proration Program Committee of the Zone adopted the resolution, hereinbefore described, setting forth the proration program; that the Agricultural Prorate Commission of California, the Proration Program Committee of the Zone and the Board of Directors of the Raisin Proration Association all assured Commodity Credit Corporation that the Zone and its Proration Program Committee, and the Raisin Proration Association and its board of directors, had power and authority under the Agricultural Proration Act of 1933, as amended, to pledge and hypothecate the twenty per cent of the raisins produced, which was to constitute the stabilization pool, as additional security for the non–recourse loans which Commodity Credit Corporation proposed to make; that Commodity Credit Corporation relied on these representations and on September 24, 1938, adopted and promulgated its resolution, heretofore referred to, whereby it agreed to make available to Raisin Proration Association (the California corporation) an amount not to exceed $9,000,000 upon the security described in that resolution; that on October 10, 1938, Commodity Credit Corporation accepted and received from Raisin Proration Association its promissory note for $9,000,000, payable on or before November 1, 1939, such sum to be available for making the non–recourse loans to growers desiring the same; that relying on the assurances of lawful authority to make the agreement hereinbefore referred to, Commodity Credit Corporation executed the pledge agreement with the Proration Program Committee of the Zone, and with Raisin Proration Association, whereby all raisins in the stabilization pool should be delivered by the Zone to the Raisin Proration Association and be pledged and hypothecated by it to Commodity Credit Corporation as added security for the loans made to growers; that Commodity Credit Corporation advanced to Raisin Proration Association $3,000,000 which was used by it in making non–recourse loans of $50 per ton on the free raisins of growers desiring such loans; that approximately 2500 growers of raisins made such non–recourse loans and delivered approximately 54,919 tons of free raisins into a free raisin pool as security for such loans; “that, pursuant to agreement between Commodity and the (Raisin Proration) Association, Commodity agreed to advance, and did advance and lend, to the Zone and Association not to exceed the sum of $4.00 per ton for carrying charges of the stabilization pool raisins, including storage, insurance, and handling expenses incurred in operating such pool, and received from said Zone and Association the pledge and hypothecation of the stabilization pool raisins as security therefor.”

It was also alleged that all of the raisins in the free raisin pool had been sold and those in the stabilization pool either had been sold or were contracted for sale and that a large amount of money advanced by Commodity Credit Corporation to those growers making the non–recourse loans remained unpaid with no source of payment of that balance being available.

The balance of this defense contains allegations upon which Commodity Credit Corporation relies to estop plaintiff and his associates from maintaining this action. It is alleged that, from September 7, 1938, plaintiff knew, or had the opportunity of knowing the financing plan adopted; that he made no objection thereto and consented to, acquiesced in and ratified it, including the pledge of his raisins in the stabilization pool to secure the non–recourse loans to other growers; that he had eighty tons of free raisins and twenty tons of raisins in the stabilization pool; that he sold his free raisins in the usual channels of trade at a price considerably in excess of the price he would have received but for the financing made possible by the money advanced by Commodity Credit Corporation; that plaintiff and all other growers in the Zone, having knowledge or means of knowledge of the financing plan put into effect, having largely benefitted thereby and having stood by while the money furnished by Commodity Credit Corporation was expended for their benefit and the benefit of all other growers in the Zone, are estopped from denying the legality of the pledge of their stabilization pool raisins to secure the non–recourse loans made to other growers.

In a third defense it was alleged that Commodity Credit Corporation had advanced and loaned to the Zone and to Raisin Proration Association the sum of $226,418.11 to be used, and which was used, in handling, storing, insuring and otherwise caring for the raisins in the stabilization pool; that no part of this sum had been repaid.

As a fourth defense it was alleged that there was no other grower of raisins in the Zone who was similarly situated as to the stabilization pool raisins as plaintiff and that he could not bring a class or representative action and could only bring an action for himself.

As a fifth defense Commodity Credit Corporation incorporated all of the allegations of its second defense therein and alleged that the cause of action was barred by the provisions of section 17 of the Agricultural Proration Act of 1933 as amended.

As a sixth defense Commodity Credit Corporation pleaded laches.

All defendants except Commodity Credit Corporation and Sun–Maid Raisin Growers of California joined in a separate answer containing two separate defenses which did not materially differ from the first and second defenses of Commodity Credit Corporation except in containing somewhat more detail.

The resolution of Commodity Credit Corporation made the manager or acting manager of the San Francisco Loan Agency of Reconstruction Finance Corporation its agent in connection with the $9,000,000 loan to the Raisin Proration Association and the loans to individual growers. It provided Raisin Proration Association should execute a note for $9,000,000, payable November 1, 1938, bearing interest at four per cent per annum, payable quarterly; that each advance made to an individual grower be endorsed on this note as credit; that $50 per ton be advanced to growers desiring such loan on non–recourse agreements signed by each grower assigning his free raisins as well as his raisins in the stabilization pool as security for the loan; that the raisins be stored and insured.

The agreement to which a copy of the resolution is attached provided that all raisins in the stabilization pool be delivered to Raisin Proration Association and be pledged by it to Commodity Credit Corporation to secure the loans to the individual growers. This pledge agreement contained the following: “Commodity may sell all or any part of the pledged raisins at any time, without demand or notice, at one or more pledge sales (which may be public or private, as determined by Commodity) on such terms and for such prices as Commodity may deem fair, subject only to the same restrictions as if such raisins were sold or otherwise disposed of by the Committee or the Association, or Commodity may release all or any part of such surplus raisins to the Association on trust receipt for disposition and the net sales proceeds upon such disposition will be remitted by the Association promptly to Commodity.”

The material factual situation presented by these involved pleadings may be summarized as follows: That the Agricultural Prorate Commission of California was duly and regularly appointed as an existing agency of the State of California; that the Zone was regularly organized under the provisions of the Agricultural Proration Act; that there was adopted pursuant to that act an agricultural prorate marketing program for the Zone which was approved by the Agricultural Prorate Commission; that the resolution of the Proration Program Committee adopting this program contained nothing concerning loans to individual growers in the Zone or a pledge of the raisins in the stabilization pool to secure such loans; that Raisin Proration Association, a nonprofit California corporation, was organized with its directorate composed of the members of the Proration Program Committee of the Zone; that these directors negotiated with Commodity Credit Corporation for loans of $50 per ton on the free raisins of growers in the Zone who desired such loans which served as a floor under the price of raisins keeping the price equal to or above that figure; that Commodity Credit Corporation agreed to supply $9,000,000 for such loans; that the Zone delivered the raisins in the stabilization pool to Raisin Proration Association which pledged them to Commodity Credit Corporation as security for such loans; that about $3,000,000 was actually loaned to individual growers through Raisin Proration Association which acted as the conduit through which the money for each loan flowed; that each grower making a loan executed a non–recourse agreement pledging his free raisins and his raisins in the stabilization pool as security with authority given to Commodity Credit Corporation to foreclose the pledge and sell the pledged raisins under restrictions already mentioned; that in excess of fifty–two per cent of the growers in the Zone made loans and executed the non–recourse contracts; that in excess of forty–seven per cent of the growers in the Zone, of which plaintiff was one, did not make loans, but sold their free raisins in the open market; (these percentages are admitted in all the briefs); that plaintiff and other non–borrowing growers had no actual knowledge of the pledge of his stabilization pool raisins when the pledge was made but had available means of acquiring that knowledge; that all of the pledged raisins have been sold but there remains a considerable balance unpaid to Commodity Credit Corporation on loans to individual growers after crediting thereon all receipts from the pledged raisins; that Commodity Credit Corporation advanced $226,418.11 which was used in paying the expenses incurred by Raisin Proration Association in handling, storing, insuring and caring for raisins delivered into the stabilization pool, no part of which sum has been repaid.

The trial court on motion of plaintiff struck out the allegations in the first defense of Commodity Credit Corporation and the other answering defendants to the effect that plaintiff and his associates had consented to, acquiesced in and ratified the agreement for the pledge of their raisins in the stabilization pool to secure the loans made to borrowing growers. It also struck out from both answers the defenses of estoppel and all the other special defenses numbered three to six, inclusive, in the answer of Commodity Credit Corporation.

The motion for judgment on the pleadings was then granted and an interlocutory judgment entered in favor of plaintiff and his associates and an accounting was ordered. To obviate the long accounting it was stipulated that the Zone should prepare and file a report showing the data as to which an accounting was ordered. Defendants reserved their rights to appeal and urge any grounds on the appeal which they might have done had the stipulation not been entered into.

This account was filed. Attached to it was a list of the names of four thousand twenty–six non–borrowing growers who had contributed raisins to the stabilization pool and the quantity delivered by each. This list contains the names of two defendants who were members of the Proration Program Committee of the Zone and of the board of directors of the Raisin Proration Association.

The report showed that there was a balance of $145,166.04 remaining from the sale of the raisins of the non–borrowing growers in the stabilization pool after deducting all charges and expenses charged against that pool. $56,281.27 of that amount was paid into court to await disposition on final judgment in this case and judgment was rendered against Commodity Credit Corporation for the balance.

The first important question argued by counsel is the authority of the Zone to pledge the raisins of non–borrowing growers in the stabilization pool to secure the debts of the borrowing growers. In this connection it should be observed that the pledge was not made by the Zone but by an independent corporation to which the Zone had delivered the raisins. The loans were not made to the Zone or by the Zone to borrowing growers but through an independent corporation to individual growers.

The Agricultural Proration Act has been held constitutional by both the State and Federal courts so that question is settled. See, Agricultural Prorate Commission of California v. Superior Court, 5 Cal.2d 550, 55 P.2d 495; Parker v. Brown, 317 U.S. 341, 63 S.Ct. 307, 312, 87 L.Ed. 315.

In the opinion in the Parker case we find the following: “The committee is authorized to pledge the raisins held in those pools in order to secure funds to finance pool operations and make advances to growers.” The question of the pledge of the raisins was not an issue and was not involved in that case. The cause of action in that case arose after the amendments of 1939 went into effect and whether or not those amendments lend support to the quoted statement is not important here. In the instant case it is sufficient to say that the provisions of the act in effect in 1938 contained no language giving express authority to the Zone or to the Proration Program Committee to pledge any of the stabilization pool raisins to secure loans to any one. This seems to be admitted by counsel for all parties. It is argued by defendants that the pledge of the stabilization pool raisins must be implied and incidental power flowing from the express powers granted to the Proration Program Committee of the Zone and necessary to carrying out and accomplishing the purpose of the act which is to withhold from the market, surplusses that would glut it and crowd prices down to a point below the cost of production. It is argued that to accomplish this the Proration Program Committee has almost unlimited power to deal with surplus raisins so long as its acts do not violate the express provisions of the Agricultural Proration Act. In this connection it is also argued that the Zone is not trustee for the growers in handling the surplus raisins in the stabilization pool so that plaintiff and his associates cannot demand an accounting of any funds derived from their sale.

The powers granted the Proration Program Committee are set forth in section 19.1 of the act, St.1935, p. 1537, from which we quote the following:

“In any marketing program approved by the commission, a program committee shall be empowered to determine the method, manner and extent of proration and the movement of the prorated commodity from harvest into a primary channel of distribution. * * *

“(a) To establish and maintain surplus pools which shall be authorized to receive from each producer from time to time his surplus of the prorated commodity and market the same by grades for the account of the producer when it can be advantageously disposed of either in its original or some converted state; provided, however, such surplus shall not be marketed in any form which would directly compete with that part of the crop which is regularly certificated; and provided, further, that any part of any such surplus may be turned over by a program committee to charitable organizations, self–help cooperatives, and similar agencies under proper safeguards to prevent any part of the commodity so disposed of from directly competing with the part of the crop marketed through the usual channels of trade. In operating any such surplus pools, a program committee may fix grading, packing, and servicing charges to be assessed against such commodities received by the pool and requiring such surplus pool, a program committee shall handle all commodities received by a surplus pool and account for the same on a pooled basis. Each producer delivering his surplus to a pool shall be credited for his proportionate share of the surplus so delivered.

“(b) To create, establish or otherwise obtain and operate facilities for the grading, packing, servicing, processing, preparing for market and disposal of such surplus in such manner as to maintain stability in the markets and to sell such surplus and/or any of its derived products. * * *

“The cost of the exercise of such powers as are herein granted to the program committee shall be a part of the cost of the operation of the program and shall be obtained through fees in the same manner as other costs of the program.”

The act provides for the appointment of an agent for the Zone by the Proration Program Committee. This agent is entrusted with the primary administration of the proration program. Section 20 of the act, St.1935 p. 1539, requires the agent to issue to each producer primary and secondary certificates. The primary certificate indicates the total volume of free raisins each producer may dispose of. The secondary certificate entitles each grower to place in the primary channels of trade the quantity of free raisins therein specified, not to exceed the total of his free raisins specified in the primary certificate.

Section 21 of the act, St.1935, p. 2089, requires the agent to “collect for each certificate issued to the producers, a reasonable and proportional fee to be fixed by the program committee so calculated as to produce the expenses of the administration of the program, the costs of the institution of the program, and a proper proportion of the cost of the maintenance of the commission which shall be fifteen per cent of the fees collected for certificates, by the agent of the zone unless the commission determines that a lesser precentage will provide sufficient revenue for its maintenance.” This is the only provision in the act which provides a fund with which to pay the administrative and other costs of the Agricultural Prorate Commission and the Zone. The purpose of these fees is expressly to defray the costs (1) of initiating the program, (2) the maintenance of the Agricultural Prorate Commission, and (3) the administration of the program.

We cannot agree with the argument of defendants to the effect that the act grants to the Proration Program Committee general implied powers to deal with the surplus raisins in the stabilization pool in any manner it desires in order to stabilize the market price of the free raisins at a point above the cost of production. While it is the purpose of the act to stabilize prices, it is clear from its provisions that this purpose is to be accomplished by removing the surplus raisins from the channels of trade until the free raisins are marketed. If those free raisins are marketed before the end of a marketing season it would seem to be the duty of the Proration Program Committee to market the surplus raisins in the stabilization pool, or as many of them as may be sold “by grades for the account of the producer when it can be advantageously disposed of either in its original or some converted state.” If they cannot be so marketed it seems clear that the whole or any part of the raisins in the stabilization pool may be turned over, given, if necessary, to charitable organizations, self–help cooperatives, and similar agencies under restrictions preventing the surplus raisins from competing with the free raisins in the usual channels of trade.

The act requires the Proration Program Committee to handle the surplus raisins in the stabilization pool and to account for them on a pooled basis. This clearly implies an obligation to account to each producer for his raisins in the stabilization pool for he is to be “credited for his proportionate share of the surplus so delivered” into the stabilization pool.

This language clearly imports an agency on the part of the Zone and its Proration Program Committee to receive and dispose of the raisins in the stabilization pool for the benefit of the growers who are the owners of at least an equitable interest in them. It also creates the obligation to account to the growers for the net receipts, if any, derived from the disposition of the surplus raisins.

Defendants argue that the relation created is not that of a trust. They contend that “clearly the Zone and the Program Committee were not trustees of a formal or statutory trust for the benefit of contributors to the stabilization pool nor were the contributors as such cestuis of a trust. On the contrary the Agricultural Prorate Commission and the Program Committee were official administrative agencies of the State of California and the members of these agencies were officers of the State. In inaugurating and carrying out a prorate program they were acting in behalf of the State and for the public at large and not primarily for the benefit of the contributors to the stabilization pool.”

This argument lacks convincing force and is not borne out by the clear language of the statute. Whether the relationship created be called that of a trust or by some other name, it possesses the characteristics of a true trust. The corpus is created and is composed of the surplus raisins in the stabilization pool. This corpus is placed in the possession of the Proration Program Committee with the power of sale or other disposition under the limitations imposed. The Proration Program Committee is required to account for the same on a pooled basis to the beneficiaries who are the growers having surplus raisins in the stabilization pool. We can see no reason why such a trust may not be created by statute. Nor can we see why the mere fact that its operation might benefit all the people of the State by improving the financial condition of the raisin growers, should be a sufficient reason for the defeat of the clear purposes of the statute in creating such a trust. It was primarily for the benefit of the raisin growers, who form an important class of the population of the State, with a secondary benefit to the other inhabitants of the State.

Defendants argue that since the Proration Program Committee is empowered by the act to give surplus raisins in the stabilization pool to charitable and like institutions, under the restriction that the raisins given away do not compete with the free raisins in the usual channels of trade, the power to pledge those raisins to Commodity Credit Corporation for a loan should be implied.

This argument divides into two separate heads: First: There is the loan of about $3,000,000 to the individual growers who borrowed parts of this sum from Commodity Credit Corporation, each borrowing grower giving to it a non–recourse agreement whereby he pledged his free raisins, and his surplus raisins in the stabilization pool, as security for the loan to him, and where Raisin Proration Association, a private non–profit corporation, and not the Zone nor the Proration Program Committee, pledged the raisins in the stabilization pool placed there by non–borrowing growers as further security for the loans to borrowing growers. The second question is the right to pledge the raisins in the stabilization pool to secure the loan of $226,418.11, made by Commodity Credit Corporation to the Zone and Raisin Proration Association to pay the expenses of handling, storing, insuring and otherwise caring for the raisins in the stabilization pool. This will be considered when we come to the order of the trial court striking out the third separate defense of Commodity Credit Corporation.

The arguments, by defendants, that the Agricultural Proration Act gives the Zone the implied power and authority to pledge the raisins in the stabilization pool to secure debts is based upon the express authority given to turn over and to “dispose of” (give away, as they argue) those raisins. This authority is contained in the second paragraph of section 19.1 of the act already quoted.

We believe that the expressions “turn over” and “dispose of”, as they are used in this paragraph, must be given synonymous meanings. We agree that these expressions must include the right to give the raisins away. See “dispose of”, Black's Law Dictionary; State v. Deusting, 33 Minn. 102, 22 N.W. 442, 53 Am.Rep. 12; Scott v. State, 6 Ga.App. 332, 64 S.E. 1005. But the right to give the surplus raisins away is strictly limited in this paragraph of the section so that the gift may be made only to charitable and other similar organizations and then only upon condition that those raisins will not compete with the free raisins in the usual channels of trade. The raisins were first delivered by the Zone to the Raisin Proration Association, a non–profit California corporation. There is no intimation in the record that this corporation could be classed as a charitable organization, or as a self–help corporation, so a gift to it would not have been authorized under the statute. This corporation pledged these raisins to Commodity Credit Corporation. There is no claim that Commodity Credit Corporation is a charitable organization nor a self–help cooperative even though its lavish use of public funds might have indicated that some of its officers had charitable impulses.

The third paragraph of section 19.1 of the act empowered the Zone to acquire and operate facilities for preparing for market and disposal of the stabilization pool raisins in any manner so as to maintain market stability and to sell them. This paragraph must be read as a whole and its language construed together. Its purpose seems to be to give the Zone latitude in preparing for market and disposing of the surplus raisins within the limitation of the last conjunctive clause “and to sell such surplus and/or any of its derived products”. The language used would seem to indicate an intention on the part of the legislature to give the Zone rather broad powers in preparing the surplus raisins for market, either as raisins or in some converted form, and in selling them for the benefit of the producer.

It is a cardinal rule of construction of statutes that when they are free from ambiguity and their meaning is clear there is no need for interpretation by the courts. In such cases the courts should not legislate by extending the clear meaning of the language used by the legislature but should give effect to that language as it is used in the statute and give to the words their common and ordinary meaning. Davis v. Hart, 123 Cal. 384, 55 P. 1060; Frinier v. C. J. Kubach Co., 177 Cal. 722, 171 P. 952; Pasadena University v. Los Angeles County, 190 Cal. 786, 214 P. 868; McNamara v. Steckman, 202 Cal. 569, 262 P. 297. The same rule is recognized in the Federal courts. United States v. Missouri Pac. R. Co., 278 U.S. 269, 49 S.Ct. 133, 73 L.Ed. 322; Commissioner v. Gottlieb, 265 U.S. 310, 44 S.Ct. 528, 68 L.Ed. 1031; In re Kunkle, D.C., 40 F.2d 563.

We can see nothing obscure, uncertain or ambiguous in the language used in the Agricultural Proration Act. Its purposes are clearly set forth. They are to stabilize the market price of an agricultural product by withholding from market the surplus portion of the crop that cannot be marketed without crowding the market price of the commodity below the cost of production. That end is to be accomplished in the manner already set forth. The whole plan is to sustain the market price by withholding the surplus and by feeding into the market the amount of free raisins it will conveniently absorb, thus maintaining the price under the familiar law of supply and demand. The Agricultural Proration Act being clear and unambiguous we cannot read into its provisions powers which the legislature failed to include.

Defendants maintain that the power to make the loans and pledge the stabilization pool raisins to secure their payment must be implied from the provisions of the act. “An intention to legislate by implication is not to be presumed.” First M. E. Church v. Los Angeles County, 204 Cal. 201, 267 P. 703, 704; Crowell v. Gilmore, 18 Cal. 370. There must be some direct connection between the powers sought to be implied and the powers expressly granted, and the implied powers must be necessary to carry out the inherent and express powers granted by the act. In re Allowance of Myers' Claim by Board of County Commissioners, 146 Minn. 103, 177 N.W. 1013.

Here the express purpose of the act is to stabilize the market price of raisins by determining the quantity the market can absorb and withholding the surplus from the market until the free raisins have passed into the hands of purchasers so that the surplus raisins cannot compete with them. The methods to be used in obtaining this end are clearly set forth in the act and ample powers to accomplish that purpose by use of those methods are granted.

The methods here used to effect the loans to the individual growers are entirely without the machinery set up in the act for the stabilization of the price of raisins. The Zone did not make the loan, or loans, and did not pledge the raisins in the stabilization pool to secure its, or their, repayment. It surrendered possession of those raisins to a private corporation which executed a promissory note for $9,000,000 payable to Commodity Credit Corporation. That private corporation did not receive, and was not intended to receive, as its own, any part of this money which it promised to pay. It served as the conduit through which passed the money loaned to individual borrowing growers by Commodity Credit Corporation. It received credit on its note for money it did not repay to Commodity Credit Corporation but which that corporation loaned to individual growers. These were non–recourse loans and each was secured by the pledge of each borrowing grower of his free raisins in the stabilization pool. The loans were also secured by an attempted pledge of the stabilization pool raisins by the private corporation to which they had been delivered by the Zone.

As far as the pleadings are concerned the only connection the Zone had with the transaction was the activity of its Proration Program Committee, the members of which also constituted the board of directors of the private corporation, in negotiating with Commodity Credit Corporation to furnish money for financing these loans and the surrender of the raisins in the stabilization pool to the private corporation. The Zone then passed out of the picture and thereafter the transaction became one between Commodity Credit Corporation, the private corporation and the borrowing growers. This transaction was private in its nature and entirely without the contemplation of anything in the Agricultural Proration Act. None of the powers assumed and used in this complicated transaction were necessary to carry out the inherent or express powers granted by that act and it would be judicial legislation of the worst kind to hold that those powers were granted by implication. We must hold that the transaction we have described, whereby the raisins of plaintiff and his associates in the stabilization pool were pledged by Raisin Proration Association, a private corporation, to secure the note of the private corporation for money which it did not receive, and the debts of borrowing growers, were unauthorized by any express or implied powers granted by the Agricultural Proration Act.

We are fortified in this conclusion by the case of Hawxhurst v. Rathgeb, 119 Cal. 531, 51 P. 846, 847, 63 Am.St.Rep. 142, where an agent entrusted with securities pledged them as security for his own debt. The Supreme Court there said: “This transaction was not within the terms of the power conferred. The language of the power was, ‘to sell, transfer, and release two certain mortgages executed by Gotthard Kunz (describing them); to indorse and transfer the notes secured by said mortgage; to sell and transfer my claims for said notes and mortgages filed in the superior court of said San Luis Obispo county, state of California, in the matter of the estate of said Gotthard Kunz, now deceased; and to receive payment of said claims, and give acquittances therefor.’ The effect of this language was to confer a power to sell and transfer the title to the securities absolutely, or, if not so sold, to collect them from the estate of Kunz. There is nothing in the language which by any proper construction purports to confer a power to pledge or hypothecate the securities for any purpose, or to borrow money thereon. The words ‘sell and transfer’, as there used, are of no broader signification than the words ‘sell and convey,’ used with reference to a conveyance of real estate; and the latter, employed as the operative words in a power to convey land, do not carry authority to mortgage or otherwise dispose of the property.”

We will next consider the third separate defense of Commodity Credit Corporation which was stricken out on motion of plaintiff. This defense alleged that on October 15, 1938, Commodity Credit Corporation, Raisin Proration Association and the Zone entered into an agreement whereby Commodity Credit Corporation agreed with the Zone and Raisin Proration Association to advance the sum of $4.00 per ton to be used in handling, storing, insuring and otherwise caring for raisins to be delivered into the stabilization pool; that it did advance $226,418.11 to the Zone and Raisin Proration Association which was used for such purposes; that no part of that sum has been repaid.

The creation of the stabilization pool and the delivery of surplus raisins into it was expressly authorized by the Agricultural Proration Act. The Zone was given power to create, establish or otherwise obtain and operate facilities for grading, packing, servicing, processing, preparing for market and disposing of, in a certain manner, the raisins in the stabilization pool and to assess grading, packing and servicing charges against those raisins requiring such handling.

Also the Zone was required to receive the surplus raisins in the stabilization pool and keep them off the market for a time at least. This would require storing or warehousing these raisins during that time. It is clear there would be an expense in connection with this operation as well as expenses in connection with preparing those raisins for market. While such costs and charges were “to be assessed against such commodities” it would seem that the act failed to provide an immediate fund to pay those expenses as they accrued as the assessments might not be collected until the surplus raisins were disposed of.

As the direct duty of caring for, processing and selling (if possible) these raisins is expressly placed on the Zone, it would seem to follow that the power to borrow money to pay those charges, if other funds were not available, must be implied as the borrowing of such money might have been necessary to carry out the duties expressly placed on the Zone by the statute. As was said in Southern Pac. R. Co. v. Stibbens, 103 Cal.App. 664, at page 678, 285 P. 374, at page 379: “The duties of a public officer include, not only those which lie within the direct definition of the statute, but also those which are necessary to the accomplishment of the purpose of his office, even though they may be an incident of his main duties, where they promote the execution of a mandate of law.”

The exact status of the Raisin Proration Association in this part of the transaction is not made very clear by the pleadings. Whether or not the money advanced to it and used by it to care for the stabilization pool raisins may be set off by Commodity Credit Corporation against any judgment obtained by plaintiff and his associates may be left to the trial court when the cause is returned for trial. It is sufficient to reach the conclusion here that it was error to strike out this defense and to grant a motion for judgment on the pleadings in its absence from the answer of the Commodity Credit Corporation.

We may now proceed to consider the defenses of consent to, acquiescence in, and ratification of the agreement to pledge the stabilization pool raisins as well as the estoppel of plaintiff and his associates to maintain that the pledge of their raisins was illegal and void. These several defenses are so closely related here and rely on similar allegations of the answers that we will not extend this opinion by considering them separately although the elements of the several defenses may not be the same in every case. Acquiescence, consent and ratification may sometimes amount to equitable estoppel. 10 Cal.Jur. 625, sec. 13.

Plaintiff seeks to support the ruling of the trial court on the ground that the pledge of the stabilization pool raisins was void and contrary to law. In support of this argument he quotes the first two sentences of section 11, 10 Cal.Jur. p. 623, and cites the case of Silverthorne v. Percey, 120 Cal.App. 83, 7 P.2d 746; Lukens v. Nye, 156 Cal. 498, 105 P. 593, 36 L.R.A., N.S., 244, 20 Ann.Cas. 158; Raisch v. City and County of San Francisco, 80 Cal. 1, 22 P. 22; Higgins v. San Diego Water Co., 118 Cal. 524, 45 P. 824, 50 P. 670, and Edge v. City of Lexington, 277 Ky. 750, 127 S.W.2d 393.

The author of the quoted paragraph of California Jurisprudence cites Lukens v. Nye, supra, in support of the text. In that case the legislature passed a bill appropriating money to pay a claim against the State. The Governor signed the bill but before doing so exacted a contract from the claimant to accept in full payment an amount considerably less than the amount appropriated and directed to be paid in the approved bill. In holding this void and thus not furnishing any basis of estoppel against the claimant, the court said [156 Cal. 498, 105 P. 596, 36 L.R.A.,N.S., 244, 20 Ann.Cas. 158]:

“The Constitution expressly declares that no payment of public funds shall be made upon any claim against the state, under any contract made without express authority of law, and that all unauthorized agreements or contracts therefor shall be null and void. Article 4, § 32. The entire proceeding was clearly contrary to public policy.

“The agreement in question being wholly void, and also against public policy, it cannot be the foundation for an estoppel.”

The other California cases cited by plaintiff involved void acts that were either contrary to express statutes or against public policy or both. It is thoroughly settled that an estoppel cannot arise under such circumstances and this is all that is held by those cases relied upon by plaintiff.

We have no such situation here. There is no provision in the Agricultural Proration Act prohibiting individual growers from borrowing money and pledging their free raisins for security. Nor does the act contain any provision prohibiting a borrowing grower from encumbering his interest in his raisins in the stabilization pool subject to the right of the zone to dispose of them as provided in the act. Those transactions are not prohibited by any law called to our attention and may be regarded here as private transactions between the borrowing growers and the Commodity Credit Corporation entirely without the purview of the Agricultural Proration Act. There is no express and direct provision of law prohibiting the Zone from pledging the stabilization pool raisins of the non–borrowing growers as added security for the debts of the borrowing growers. As such a pledge was not within the powers granted the Zone, either expressly or by implication, we regard the attempted pledge as invalid because it was an unauthorized act and not because it was in violation of an express statute. There is a vast difference in effect between an unauthorized act in excess of a power and an unlawful act contrary to law or to public policy. The former may be ratified and form the basis of an estoppel while the latter cannot. California C. P. Growers v. Harkey, 11 Cal.2d 188, 78 P.2d 1137; Julian v. Schwartz, 16 Cal.App.2d 310, 60 P.2d 887; New York Life Ins. Co. v. Occidental Pet. Corp., 43 Cal.App.2d 747, 111 P.2d 707; Carlston v. Shenson, 47 Cal.App.2d 52, 117 P.2d 408; Lukens v. Nye, supra.

In this case defendants have pleaded estoppel by silent acquiescence in acts which were not contrary to express statutory provisions nor against public policy but which were in excess of authority. If the other elements of estoppel, acquiescence and ratification were properly pleaded the trial court erred in striking out those portions of the answers.

Plaintiff maintains there can be no estoppel here because, (1) he and his associates did nothing which “led or induced another to do that which he otherwise would not have done”, and (2) that Commodity Credit Corporation relied on misrepresentations of law which do not form a proper basis for estoppel and that those representations were neither made by plaintiff nor his associates.

It is true that plaintiff did nothing affirmatively to mislead Commodity Credit Corporation. He simply stood by silent and inactive while Commodity Credit Corporation loaned about $3,000,000 to growers on security partly composed of plaintiff's raisins in the stabilization pool. Silence and inaction may form the basis for an estoppel where the person against whom the estoppel is invoked in good conscience and good morals should have spoken or acted. Julian v. Schwartz, supra; New York Life Ins. Co. v. Occidental Pet. Corp., supra; 10 Cal.Jur. 631, sec. 16.

It is true that plaintiff personally was not a party to the contracts made by the borrowing growers, Raisin Proration Association and the Zone with Commodity Credit Corporation, but the Zone took an active part in the plan in delivering the raisins to Raisin Proration Association for pledge and plaintiff maintains the Zone was his trustee. If plaintiff had knowledge of these transactions and was to profit from them, as alleged, it seems to us he should have objected to the pledge of his raisins if he did not approve the plan, before Commodity Credit Corporation had loaned very large sums of money to borrowing growers, the total of which it now appears it cannot recover. This may well be a case where plaintiff should in good conscience and morals have spoken and acted, or, upon failing to have done so, be estopped from contesting the legality of the transaction. If plaintiff should have spoken or acted and if his silence and inaction misled Commodity Credit Corporation to its damage, and plaintiff profited thereby, a case for the application of the doctrine of estoppel was presented.

It is urged by plaintiff that the Agricultural Prorate Commission, the Proration Program Committee and the board of directors of Raisin Proration Association, upon advice of the Attorney General of California given in a letter dated August 8, 1938, advised Commodity Credit Corporation that there was legal authority for the pledge of the raisins in the stabilization pool for the loans made to the individual growers; that plaintiff and his associates did not join in these representations and cannot be bound by them; that these representations were made concerning matters of law and not of fact; that misrepresentation as to matters of law ordinarily cannot form the basis for an estoppel.

Subject to certain exceptions not important here, misrepresentations as to matters of law afford no sufficient basis for an estoppel. 10 Cal.Jur. 630. However this does not answer the problem before us. The misrepresentation charged against plaintiff was his failure to object to the pledge of his raisins in the stabilization pool to secure the debts of others thus giving rise to the belief that he consented to, acquiesced in, and ratified such a pledge. This was not a representation that he considered the pledge lawful, but was a representation of a fact and may be sufficient, if proved, to establish the defense of estoppel.

We therefore conclude that the defenses of consent, acquiescence, ratification and estoppel were available to defendants and should not have been stricken from their answers.

Laches is a plea that is available to a party in a court of equity. It was defined in Cahill v. Superior Court, 145 Cal. 42, 78 P. 467, 469, as follows: “ ‘Laches' is defined as ‘such neglect or omission to assert a right as, taken in conjunction with the lapse of time, more or less great, and other circumstances causing prejudice to an adverse party, operates as a bar in a court of equity.’ [18] Am. & Eng.Ency. of Law, 2d Ed., p. 97. ‘In determining what will constitute such unreasonable delay, regard will be had to circumstances which justify the delay, to the nature of the case and the relief demanded, and to the question whether the rights of the defendant, or of other persons, have been prejudiced by such delay.’ ”

While laches is not the same as estoppel it has been called quasi estoppel. Although the rules governing equitable estoppel do not apply to laches (Bell v. Hudson, 73 Cal. 285, 14 P. 791, 9 Am.St.Rep. 791) they both may involve acquiescence and consent. Under the facts pleaded in the answer of Commodity Credit Corporation, the defenses of laches and estoppel are so closely related that no good could be accomplished by considering the defense of laches in detail. It should be sufficient to say that this defense should have been made available to Commodity Credit Corporation and that it was error to strike that defense from the answer.

Commodity Credit Corporation strenuously argues that the allegations of the complaint are insufficient in law to permit plaintiff to maintain a class or representative action to recover for non–borrowing growers other than himself. It urges that the complaint fails to allege there were many non–borrowing growers who stood in the same position as plaintiff, for whom he could act. It asserts that the only allegations on this subject are those contained in paragraph thirteen of the complaint, which we have quoted. Were this true there would be much justification for this argument. In this connection it must be admitted that the allegations on this subject could have been much more clear and specific.

Section 382 of the Code of Civil Procedure provides in part that “when the question is one of a common or general interest, of many persons, or when the parties are numerous, and it is impracticable to bring them all before the court, one or more may sue or defend for the benefit of all.” It is clear that either or both of the factors set forth in the section must appear from the allegations of the complaint. The question must be one of common or general interest of many persons or the parties must be so numerous that it is impracticable to bring them all before the court.

We are permitted to take judicial notice of facts concerning the raisin industry of California. Agricultural Prorate Commission v. Superior Court, supra; Parker v. Brown, supra. It is a matter of common knowledge to each one of us and to every inhabitant of those counties composing the Zone that there are many thousands of persons engaged in the growing of raisin grapes in those counties. The questions presented here which involve the Raisin Proration Program, adopted and put into effect, must have been of common and general interest to all of those growers because the stabilization of the market price they would receive for their raisins depended to a considerable extent on the details of the marketing program, some of which are before us for consideration.

Further, we believe that the fair implication may be drawn from paragraphs seven, ten, eleven, twelve, and thirteen of the complaint that there were many growers having raisins in the stabilization pool who had not borrowed from Commodity Credit Corporation and so occupied positions similar to that of plaintiff in so far as this action is concerned.

Plaintiff points out that the judgment discloses that two members of the Proration Program Committee of the Zone, who were directors of Raisin Proration Association and as such negotiated with Commodity Credit Corporation, were non–borrowing growers and were given judgment against Commodity Credit Corporation. It is argued that at least these growers should be estopped from obtaining such judgment. On the face of the record, including the judgment, this argument would seem to possess considerable merit. However the sufficiency of a complaint is to be judged by the allegations it contains. Estoppel is usually an affirmative defense that should be pleaded by a defendant. It may defeat the cause of action set up in the complaint. The purpose of estoppel is not to test the sufficiency of a complaint but to defeat the cause of action set forth in it. If these two growers, and others, be estopped to bring the action or benefit by the judgment, this is a matter to be determined at the trial either because of failure of proof on the part of plaintiff or of successful defense. Such growers might be permitted to intervene in the action if they so desire or to join in its defense.

There are numerous cases in this State involving the right to bring class or representative actions. We cite the following which support the conclusions we have reached. Wheelock v. First Presbyterian Church, 119 Cal. 477, 51 P. 841; Coachella Valley County Water Dist. v. Stevens, 206 Cal. 400, 274 P. 538; Peterson v. Donelley, 33 Cal.App.2d 133, 91 P.2d 123.

Commodity Credit Corporation pleaded the defense of the limitation on the time of bringing the action contained in section 17 of the Agricultural Proration Act. That section in effect in 1938, provided as follows: “Any order of the commission instituting a proration program and any other order of the commission substantially affecting the rights of any interested party may be reviewed by any court of competent jurisdiction. Any such action must be commenced within thirty days after the effective date of the order complained of or within thirty days after the injurious effect complained of.” (Stats.1935, p. 1535.)

This section was amended by the legislature in 1939, Stats.1939, p. 2495, to read as follows: “Any order of the director instituting a proration program and any other order of the commission or director substantially affecting the rights of any interested party may be reviewed by any court of competent jurisdiction. Any such action must be commenced within thirty days after the effective date of the order complained of.”

This amendment went into effect on September 19, 1939, so it had been in full force and effect for almost six months when this action was filed.

The section in effect in 1938 when the proration program was adopted, and when the attempted pledge of the raisins in the stabilization pool was made, contained two limitations on the time in which an order of the Agricultural Prorate Commission could be reviewed. One was thirty days after the effective date of the order. The other was thirty days after such an order had injuriously affected a complaining party. Thus, as applicable here, the limitation on a review was not necessarily a fixed thirty day period after the order went into effect, but might be thirty days after it appeared that the order would injuriously affect the rights of plaintiff. Thus the date on which the plaintiff's right of action would be barred by the provisions of the section then in effect could not be fixed until the determination of the date that the order injuriously affected him.

The amendment of 1939 removed this uncertainty from the section and fixed the 30th day after the effective date of the order on or before which the proceeding to review it must be instituted. It seems to be clear that under some circumstances the 1939 amendment would materially shorten the time in which a plaintiff might seek to review an order of the Agricultural Prorate Commission such as we have before us here. The effective date of the order under attack was in September, 1938. If the 1939 amendment be given the exact effect of its language the proceeding to review the order would have been barred thirty days thereafter, or in October, 1938.

No person has a vested right in any particular period of limitation. Ordinarily the determination of that period is within the sound discretion of the legislature which may lengthen or shorten it subject to the important exception thus stated in Edwards v. Kearzey, 96 U.S. 595, 603, 24 L.Ed. 793, as follows: “Statutes of limitation are statutes of repose. They are necessary to the welfare of society. The lapse of time constantly carries with it the means of proof. The public as well as individuals are interested in the principle upon which they proceed. They do not impair the remedy, but only require its application within the time specified. If the period limited be unreasonably short, and designed to defeat the remedy upon preexisting contracts, which was part of their obligation, we should pronounce the statute void. Otherwise, we should abdicate the performance of one of our most important duties.”

The same rule was announced in Coleman v. Superior Court, 135 Cal.App. 74, 26 P.2d 673, 674, as follows: “The authorities appear to be uniform in holding that the Legislature has the right to either lessen or lengthen a statute of limitations, subject only to the exception that an existing right cannot be cut off summarily, that is, without giving a reasonable time after the act becomes effective to exercise such right.”

The general rules governing changes in periods of limitations of action are clearly stated in 34 Am.Juris. 29, et seq., secs. 21 to 26, inclusive. The cases there cited support those rules.

By analogy the case of Shea v. City of San Bernardino, 7 Cal.2d 688, 62 P.2d 365, should govern the decision of the effective date of the bar of the statute under the 1939 amendment. In the Shea case one of the plaintiffs was injured in an accident which happened on April 19, 1931. In 1931 the legislature passed an act (Stats. 1931, p. 2475) requiring claimants to file a verified claim for damages sought to be recovered from a municipality. This act went into effect on August 14, 1931, more than ninety days after the happening of the accident so that it was impossible for the plaintiffs to comply with the language of the statute. A claim was filed on the 90th day after the effective date of the statute which was held to be compliance with it. The effect of that holding is this: Where a statute of limitation takes effect after a cause of action has accrued, and bars the remedy, the plaintiff will be given a reasonable time after such effective date in which to comply with its terms. The 90 days provided in the statute for filing the verified claim was held to be a reasonable time after the act went into effect within which to file the claim, and filing it within that time was held to be compliance.

When we apply the holding in the Shea case to the facts of the instant case we must conclude that the plaintiff had thirty days after the effective date of the amendment, or until October 19, 1939, in which to review the order in question. The question remains: Was this a reasonable time within which plaintiff could act to protect his rights?

What is a reasonable time within which to exercise a right has been the subject of a multitude of decisions in the courts of the various states and of the United States. It was remarked in Kinyon v. Kansas Soldiers' Compensation Board, 118 Kan. 367, 234 P. 949, that under some circumstances a period of three months within which to institute an action had been held insufficient, while under others a limitation restricted to thirty days had been upheld. Merely by way of illustration, we cite the following cases where limitations of from thirty days to eight months have been held reasonable: Randolph v. City of Springfield, 302 Mo. 33, 257 S.W. 449, 31 A.L.R. 612; Mulvey v. City of Boston, 197 Mass. 178, 83 N.E. 402, 14 Ann.Cas. 349; Osborne v. Lindstrom, 9 N.D. 1, 81 N.W. 72, 46 L.R.A. 715, 81 Am.St.Rep. 516; Steele v. Gann, 197 Ark. 480, 123 S.W.2d 520, 120 A.L.R. 754; Crawford v. Hunt, 41 Ariz. 229, 17 P.2d 802, and Wheeler v. Jackson, 137 U.S. 245, 11 S.Ct. 76, 34 L.Ed. 659, 664.

In California we have various statutes of repose. In certain street improvement proceedings a property owner must file objections in periods ranging from ten to thirty days or he will be considered to have waived non–jurisdictional objections. See Warren v. Russell, 129 Cal. 381, 62 P. 75; Williams v. Bergin, 108 Cal. 166, 41 P. 287; Smith v. Hazard, 110 Cal. 145, 42 P. 465; Chase v. Trout, 146 Cal. 350, 80 P. 81. A contest of an election, except on certain grounds, must be filed in thirty days (Sec. 8511, Elections Code, St.1939, p. 263; McClintock v. Abel, 21 Cal.App.2d 11, 68 P.2d 273), but formerly in forty days. Carlson v. Burt, 111 Cal. 129, 43 P. 583. An action on a rejected claim against an estate must be filed within three months after notice of rejection. Sec. 714, Probate Code; Fifield v. Bullwinkel, 81 Cal.App. 440, 253 P. 962.

The foregoing cases are illustrative of those in which quite brief periods of limitations have been upheld. On the other hand there are well considered cases holding that a reduction of the time for bringing an action to three years was unreasonable and could not be enforced. Some of those cases are cited in the notes to American Jurisprudence already referred to.

Our study of the question has led us to the conclusion that there is no hard and fast rule as to what is a reasonable limitation of time within which to bar a party bringing an action or protecting a property right. That question is usually left to the sound discretion of the legislature, which will not be disturbed except in case of an abuse of that discretion, subject to an exception important here, that where the period of limitation has been reduced it cannot be so reduced as to destroy an existing right of action. This exception seems to be generally recognized in the various jurisdictions.

In applying these rules to the instant case we must first consider when plaintiff's cause of action would have been barred under the statute in effect in 1938, or in other words, when he would have been injuriously affected by the pledge of his stabilization pool raisins to secure the debts of others.

We must remember that each borrowing grower signed a non–recourse contract whereby he pledged both his free raisins and his raisins in the stabilization pool as security for the money loaned him by Commodity Credit Corporation. This was the primary security for repayment of the loan. As further and additional security the raisins of the non–borrowing growers in the stabilization pool were pledged to secure the total of all loans. It would seem that in accordance with the principles of equity the creditor should be required to exhaust its primary security, given by the borrowing growers, before resorting to the secondary security belonging to the non–borrowing growers. If this be true all of the free raisins pledged and the raisins in the stabilization pool belonging to borrowing growers would have had to have been disposed of before it could have been determined if resort would be had to the raisins in the stabilization pool of the non–borrowing growers, for if the debts were fully paid by the raisins of the borrowing growers there would be no occasion to resort to the raisins of the non–borrowing growers. Thus the time when it would appear that plaintiff and his associates might be injuriously affected by the pledge of their stabilization pool raisins would not have arrived until November, 1939, when, it is alleged in the answers, that the stabilization pool raisins were finally disposed of. Thus (assuming the truth of the allegations in the answers) under the provisions of section 17 of the Agricultural Proration Act, as it existed in 1938, the cause of action of plaintiff would not have been barred until December, 1939. The 1939 amendment barred the cause of action on October 19, 1939, before the stabilization pool raisins had been disposed of and before plaintiff and the other non–borrowing growers could have determined whether or not they had been injuriously affected by the pledge of their stabilization pool raisins. Under these circumstances we must conclude that the amendment of 1939 did not give plaintiff and his associates a reasonable time within which to exercise their right to contest the legality of the pledge of their stabilization pool raisins to secure the debts of others, and that the provisions of the amended section cannot be controlling here as they would destroy an existing cause of action. The appropriate statute of limitation, contained in the Code of Civil Procedure, would be the only one applicable to this action as the limitation of section 17, in effect in 1938, had been abrogated by the 1939 amendment and that amendment cannot be given effect.

Whether or not the limitation of thirty days, as contained in the 1939 amendment, as affecting actions arising after its effective date is reasonable, is not involved here and has not been considered.

Commodity Credit Corporation argues that section 17 of the Agricultural Proration Act furnishes a complete remedy through which the validity of a marketing program and its effect on the public, growers and packers may be judicially determined; that this is an exclusive remedy which must be followed; that the Agricultural Prorate Commission is a necessary party to any attack on its marketing program. Richfield Oil Corporation v. City of Syracuse, 287 N.Y. 234, 39 N.E.2d 219, and Myers v. Bethlehem Shipbuilding Corporation, 303 U.S. 41, 58 S.Ct. 459, 82 L.Ed. 638, are cited in support of this argument. The Richfield Oil Corporation case involved an attack on a street widening proceeding under a local improvement act which specified a procedure that must be followed to attack such proceedings where such attack did not involve the constitutionality of the act. The court held that the property owner attacking the proceeding on grounds not involving constitutionality must follow the procedure there prescribed. The Myers case involved an attack on the jurisdiction of the National Labor Relations Board in a case involving a labor dispute. The action was started in the Federal District Court. All that was held was that the National Labor Relations Act, 29 U.S.C.A. § 151 et seq., vested exclusive jurisdiction of such proceedings in the Circuit Court of Appeals so the Federal District Court had no jurisdiction of the action. Neither case can be controlling here as the brief provisions of section 17 of the Agricultural Proration Act cannot be said to lay down the procedure and afford a complete remedy to review an order of the Agricultural Prorate Commission. Its purpose is to impose a limitation on the time in which such proceedings may be instituted.

The reasoning of defendants in support of this argument is not at all clear. We take it to be this: It is provided in the section that an order may be reviewed by a court within thirty days of the effective date of the order; that the word “review”, we assume the argument to be, must be construed as a writ of review as known in the law. Such an argument cannot prevail in California as a writ of review can not be directed to a board having state wide jurisdiction. Standard Oil Co. v. State Board of Equalization, 6 Cal.2d 557, 59 P.2d 119. To give the act such a construction would be to nullify it which is contrary to the established rules of statutory construction. We believe the word “review” is used in the section in the very general sense of a critical study or examination in any appropriate action in a court of competent jurisdiction.

While the Agricultural Prorate Commission might have been a proper party to this action it was not a necessary party. The purpose of the action was to enjoin the payment to Commodity Credit Corporation of money derived from the sale of raisins of non–borrowing growers in the stabilization pool and to recover from that corporation money paid to it which had its source in such sale. Agricultural Prorate Commission had none of that money under its control and, as far as the pleadings disclose, had nothing to do with the sale of those raisins and the payment of money to Commodity Credit Corporation.

In view of the present state of the pleadings the parties should be given a reasonable time within which to file amended pleadings.

The judgment is reversed with directions to the trial court to permit the parties to file amended pleadings if they be so advised.

MARKS, Justice.

BARNARD, P. J., and GRIFFIN, J., concur.