Columbus Packaging Co v. State

• Decision Date: 27 August 1919
• Docket Number: 16402
• Citation: 100 Ohio St. 285,126 N.E. 291
• Parties: The Columbus Packing Co. v. The State, Ex Rel. Schlesinger, Prosecuting Attorney, Et Al.
• Court: Ohio Supreme Court

126 N.E. 291

100 Ohio St. 285

The Columbus Packing Co. v. The State, Ex Rel. Schlesinger, Prosecuting Attorney, Et Al.

No. 16402

Supreme Court of Ohio

August 27, 1919

Injunction - Violation of Antitrust Law - Sections 6390 to 6402,General Code - Statutes in pari materia - Smith Cold Storage Law - Sections 1155-1 to 1155-19, General Code (107 O. L., 594) - What constitutes violation - Injunction and receivership lie when - Error proceedings - "Judgment" construed.

1. By the provisions of the Valentine Anti-trust Law, Sections 6390 to 6402, General Code, inclusive, jurisdiction is conferred on courts of common pleas to enjoin violations of that law and in cases brought thereunder the court may make all such orders as are warranted by the rules and proceedings in equity.

2. The Cold Storage Act (107 O. L., 594) and the Valentine Antitrust Law (Sections 6390 to 6402, General Code) are to be construed in pari materia.

3. Where it appears that articles of food have been held in cold storage by arrangement or contract between two or more parties for such period that the sale by the owner is prohibited by the provisions of the Cold Storage Act, such act constitutes a violation of the terms of the Valentine Anti-trust Law.

4. In such case the court may enjoin the sale by the offending party of such food products, and may appoint a receiver to take and hold same, and if it deems it best for all concerned may order the receiver to sell them in such manner as may be just and as the court may prescribe.

5. An order so made in such a proceeding is a judgment under the constitution, which may be made the predicate of a proceeding in error.

The facts are stated in the opinion.

Messrs Bennett, Westfall & Bennett, for plaintiff in error.

Messrs. Wilson & Rector, for cross-petitioner in error.

Mr. Hugo N. Schlesinger, prosecuting attorney; Mr. Timothy S. Hogan and Mr. Oscar W. Newman, for defendants in error.

NICHOLS C. J.

On the 6th of August, 1919, the State of Ohio, acting through Hugo N. Schlesinger, Prosecuting Attorney of Franklin county, Ohio, filed its action in the common pleas court of Franklin county, Ohio, against The Columbus Packing Company and The Fairmont Creamery Company.

The Columbus Packing Company is an Ohio corporation engaged in the slaughtering of cattle, swine, sheep and other domestic animals and exposing same for sale as food. The Fairmont Creamery Company is an Ohio corPoration licensed to operate under the provisions of Section 7 of the Cold Storage Act of March 21,1917, 107 Ohio Laws, page 594.

The action is one for injunction, the appointment of a receiver, and other equitable relief. By the provisions of Section 6400, General Code, jurisdiction is conferred on courts of common pleas to enjoin violations of the Valentine Anti-trust Law, Sections 6390 to 6402, General Code, inclusive, and in cases brought therein the court may make all such orders as demanded by the rules and proceedings in equity. By the terms of the Cold Storage Act it is made unlawful to sell or offer for sale certain food products therein named held in storage for a period longer than six months. By the terms of the Valentine Anti-trust Act it is made unlawful to create or carry out restrictions in trade or commerce. It is further made unlawful to prevent competition in the sale or purchase of a commodity.

It is charged in the petition that the defendant companies in respect to the storage of 150,000 pounds of pork have violated the provisions of both of said laws; that between the 29th of November, 1918, and the 5th of February, 1919, certain whole carcasses of pork or parts thereof were delivered to the Creamery Company and that such food product remained in storage for a period longer than six months in violation of the express pro visions of Section 13 of the Cold Storage Act. It is claimed that the storage of a food commodity for so long a period as to render it unsalable in Ohio by the owner is per se an act in restraint of trade, and that such storage acts as a preventive of competition.

The vital and controlling issue of fact in the case centers around the duration of time the pork in question had remained in cold storage prior to the institution of the suit.

The defendant Creamery Company expressly admits that the goods had been stored in its warehouse for the period of time set forth in the petition. The defendant Packing Company, after admitting the delivery of certain parts of carcasses of pork to the Creamery Company for storage, denied the allegation as to length of time of storage in this language: "But not being advised as to the exact number of pounds or dates of delivery of each, it denies the allegation concerning the same." Further along in the answer the Packing Company did, however, admit in substance the allegations in respect to the alleged unlawful storage. Its language in this respect is as follows: "That it has not sold, offered or exposed for sale any of said pork products after the expiration of said six months during which said pork products have been held in said cold storage warehouse."

It is further alleged in this answer "That it has tried by its officers and agents in every possible way to dispose of the same at a fair market value, but that owing to the quantity of pork loins thus accruing, as hereinbefore described, in the hands of said defendant, it was unable to sell or dispose of the same within the time limit thus mentioned in said act of the General Assembly."

At the hearing of the case in the court of corn-mon pleas, the defendant Packing Company introduced in evidence its answer, and the affidavits of J. D. Reed, A. S. Goddard and J. N. Mathy. These affiants claimed to represent parties that had purchased certain portions of the food in question before the expiration of the six months. Each of these affidavits contained the following statement of fact: "That the frozen pork loins purchased thereunder were merely left in The Fairmont Creamery/ Company so as to provide for the care and protection of the same from danger of decay." It would appear, therefore, that the trial court was amply justified in treating the question as to the length of time of storage as fully established by the admissions of all the parties, including the repre- sentatives of the alleged purchasers of part of the property.

The Creamery Company expressly admits it. The representatives of the alleged purchasers admit it, for they say that after they purchased a portion of the property on the 9th of July it continued to remain in the warehouse. The Packing Company when reaching the stage of explanation and justification in its answer, avers that it was unable to find a purchaser for the remainder of the property within the time limit fixed by the general assembly. This language, construed as it must be most strongly against the pleader, is incapable of any construction other than an express admission that the unsold portion of the pork remained in storage in excess of six months.

The court of common pleas granted an injunction restraining the delivery of the pork to the Packing Company, and restraining the Packing Company from offering any part thereof for sale. It also appointed a receiver to take charge of the property. The defendant companies filed motions to discharge the order of injunction and to remove the receiver. At the hearing of these motions, all of the pleadings were, introduced in evidence, together with certain affidavits. The court overruled the motions and thereafter issued its order to the receiver to sell the property without delay. Exceptions were taken by the defendant companies, and error was prosecuted to the court of appeals of Franklin county. Here with slight modification the judgment was affirmed. Proceedings in error were forthwith prosecuted to the supreme court.

The fact of storage in excess of six months having been established, the question remains, does the admitted conduct of the parties defendant constitute a violation of the Cold Storage Act and the Anti-trust Act, either or both?

If it does not, then what has been done in this instance, however injurious to the public welfare, is beyond any remedy that the judiciary may provide.

The two acts under consideration are in pari materia, both having been enacted for the protection of the public from certain evils of trade and commerce, the cold storage act having for its primary purpose the protection of the public health, while the anti-trust act has to do chiefly with relieving the people from commercial exactions and extortions.

The protection of the public health cannot be said to be the sole purpose of the cold storage act, for clearly the limitation of the time that food commodities may be offered for sale operates automatically to defeat the practice of food hoarding. The purpose must be ascribed to the general assembly of comprehending the full scope and effect of its enactment. The effect of the cold storage act was to practically make contraband all such food stored longer than six months. Purveyors of food are not supposed to wilfully destroy their' most accessible market. In reasonable contemplation then the limitation of the storage period with the penalty imposed, must have been reckoned a most efficient remedy against food hoarding for profiteering purposes. While there is no express provision in the act making it unlawful to store food for a period longer than six months, there is an unmistakable declaration of public policy that in Ohio pork products ought not to be stored for a period greater than six months, and it, therefore, becomes the manifest duty of the courts to prevent such practices if in their power so to do.

It by not means follows that the cold storage act standing alone,...