Collins v. Bay City Export Lumber Co.

• Decision Date: 21 January 1954
• Docket Number: 1 Div. 522
• Citation: 70 So.2d 273,260 Ala. 308
• Parties: COLLINS v. BAY CITY EXPORT LUMBER CO., Inc. et al.
• Court: Alabama Supreme Court

Page 273

70 So.2d 273

260 Ala. 308

COLLINS v. BAY CITY EXPORT LUMBER CO., Inc. et al.

1 Div. 522.

Supreme Court of Alabama.

Jan. 21, 1954.

Si Garrett, Atty. Gen., and H. Grady Tiller and Wm. H. Burton, Asst. Attys. Gen., for appellant.

McCorvey, Turner, Rogers, Johnstone & Adams, Mobile, for appellees.

PER CURIAM.

This case has come here by appeal taken by the License Inspector of Mobile County from what the trial judge and the parties treated as a final judgment in a declaratory proceeding brought by appellees against appellant, as such license inspector, to determine their liability, respectively, for a license which the inspector claims is owing by them to the State.

There are several matters which suggest themselves that are not relied on nor argued by counsel. One is that the complainants each have no interest in the status and claim of the others, except in the principle of law involved. While that relationship does not give them a common interest in the subject matter of the suit, Roanoke Guano Co. v. Saunders, 173 Ala. 347, 56 So. 198, 35 L.R.A.,N.S., 491; Southern Steel Co. v. Hopkins, 174 Ala. 465, 57 So. 11, 40 L.R.A.,N.S., 464; United States Fidelity & Guaranty Co. v. Benson Hdw. Co., 222 Ala. 429, 132 So. 622; Lee v. City of Birmingham, 223 Ala. 196, 135 So. 314; Ruffin v. Crowell, 253 Ala. 653, 46 So.2d 218, no such point is made by counsel. So we will not further notice it.

Another situation is that the pleadings consist of a bill for a declaratory judgment and a demurrer to it. The decree recites a submission for decree on demurrer and overrules it in proper form, and then quotes from the briefs of counsel such features as justify him (the judge) in considering the respondent as having filed an answer admitting the allegations of the bill, and upon that status decrees that complainants are not liable for the tax sought to be imposed and that they should pay the costs for which execution is ordered.

The irregularity here is in not submitting for final decree after overruling the demurrer, and in that there was no answer making an issue and no decree pro confesso. A submission for final decree should be ordered and a note of testimony made, Equity Rule 57 et seq. Code 1940, Tit. 7 Appendix, and then only after a decree pro confesso has been rendered upon a failure to answer after the demurrer was overruled. Equity Rules 24 and 43. But such irregularity may be waived and the decree is not void. Atkins v. Atkins, 253 Ala. 43, 42 So.2d 650.

The appeal was taken within a week after the decree was rendered. So that we will treat the appeal, as the assignments of error do, as presenting the decree overruling the demurrer and as finally granting complainants full relief as prayed for. We take the allegations of the bill as admitted. It alleges that complainants are each resident citizens of Mobile County, Alabama, or respectively a corporation organized and existing under the laws of Alabama. It then refers to Title 51, section 546, Code, which fixes a state license of $100 on 'Each wholesale dealer, or jobber of lumber and timber and for each wholesale dealer in lumber and timber on commission whether maintaining an established place of business or ont'. The balance of the statute need not be here set out. The bill alleges that complainants and each of them are engaged in exporting lumber (the brief admits that they are engaged in the wholesale lumber business in Mobile County). That all the lumber bought by them is for export, and received and handled by each of them as a commodity for export and is bought and sold exclusively as export items in foreign commerce, with the exception of a few odds and ends not up to specifications and of insignificant comparative value. During the years in question the business of each of them annually extended to between $500,000 to $1,000,000, with rare exceptions. The bill alleges that the nature of the business of each of them is that 'they buy lumber from various sawmills and other sources within the state of Alabama and neighboring states; this lumber is shipped to that particular complainant purchasing it to be delivered at the Alabama State Docks at Mobile, Alabama, with all bills of lading marked 'For Export'; some such shipments are made to other seaports, but in all instances it is purchased by and shipped to complainant for export.' There is alleged to be an 'infinitesimally small percentage of total sales' which do not get in export because not up to specifications. The bill of complaint does not allege that a bill of lading consigning the lumber to a foreign port was issued on which it was first moved to complainants at Mobile for some such purpose as 'milling in transit'. It was consigned to complainant at Mobile, who has purchased and paid for it. It was then reshipped by complainant on a new bill of lading to fill orders for lumber of certain specifications. They could do with it what they thought best. The fact that the bills of lading to them were marked 'For Export' meant nothing of legal importance here involved.

The result here sought is controlled rather by the Import-Export Clause of the Federal Constitution, which is Article 1, section 10, cl. 2, than the Commerce Clause, which is Article 1, section 8, cl. 3.

The Commerce Clause confers upon Congress the power to regulate commerce with foreign nations and among the several states, without any other provision. The Import-Export Clause, supra, provides that no state shall lay any imposts or duties upon imports or exports without the consent of Congress.

The Supreme Court of the United States in construing the Commerce Clause has called attention to the fact there are no prohibitions and no limitations expressed in it, but that because of the power to regulate thus conferred upon Congress, that power was taken away from the states except that the states in the exercise of their police power may prescribe certain phases of conduct necessary to that end and may tax local incidents which affect interstate commerce, but such tax may not be laid directly on commerce or unduly burden commerce and must not be discriminatory against commerce; but recognizes the duty and obligation of interstate commerce to pay its way in government, subject to those limitations expressed above--sometimes referred to as qualifications. Those principles have been applied and consistently maintained by the United States Supreme Court and are set out in our own cases. Sanford Service Co. v. City of Andalusia 256 Ala. 507, 55 So.2d 856; Sanford v. City of Clanton, 32 Ala.App. 253, 15 So.2d 303; Graves v. State, 258 Ala. 359, 62 So.2d 446. See, Freeman v. Hewit, Director, 329 U.S. 249, 67 S.Ct. 274, 91 L.Ed. 265; Morgan v. Commonwealth of Virginia, 328 U.S. 373, 66 S.Ct. 1050, 90 L.Ed. 1317; Interstate Transit Co. v. Lindsey, Clerk, 283 U.S. 183, 51 S.Ct. 380, 75 L.Ed. 953; Spector Motor Service, Inc. v. O'Connor, 340 U.S. 602, 71 S.Ct. 508, 95 L.Ed. 573; McGoldrick v. Berwind-White Coal Mining Co., 309 U.S. 33, 60 S.Ct. 388, 84 L.Ed. 565; Puget Sound Stevedoring Co. v. Tax Comm. of State of Washington, 302 U.S. 90, 58 S.Ct. 72, 82 L.Ed 68; Joseph v. Carter & Weekes, 330 U.S. 422, 67 S.Ct. 815, 91 L.Ed. 993; Caskey Baking Co. v. Commonwealth monwealth of Virginia, 313 U.S. 117, 61 S.Ct. 881, 85 L.Ed. 1223; Hopkins v. United States, 171 U.S. 578, 19 S.Ct. 40, 43 L.Ed. 290; Ficklen v. Taxing District, 145 U.S. 1, 12 S.Ct. 810, 36 L.Ed. 601.

Referring to some of those cases we note that in the McGoldrick case, supra, a local activity was allowed to be taxed when it consisted of the delivery of merchandise at the completion of a movement in interstate commerce when that delivery was also the completion of a contract of sale of such property.

In Freeman v. Hewit, Director, supra, it was noted that a state tax could sometimes properly fall on an incident of interstate commerce for the purpose of making commerce bear its fair share of the cost of local government whose protection is enjoyed.

In the case of Hopkins v. United States, supra, it was held that a livestock commission merchant was not engaged in interstate commerce although stock is shipped to him from another state, consigned to him for sale and sold for shipment to other states or foreign countries, and although he pays drafts drawn against the consignments of stock to him for sale or may have previously loaned money to aid in conditioning the stock for market and may have taken a mortgage on it. He does not buy and sell on his own account, but acts as broker for the sale in interstate commerce.

In Ficklen v. Taxing District, supra [145 U.S. 1, 12 S.Ct. 812], taxpayers rented a room in the town in which they resided. They used no capital and had no merchandise, and did not buy or sell their own products, but were engaged in negotiating sales for their principals in foreign states of goods to be shipped in interstate commerce. It was said: 'Where a resident citizen engages in general business subject to a particular tax, the fact that the business done chances to consist, for the time being, wholly or partially in negotiating sales between resident and nonresident merchants of goods situated in another state does not necessarily involve the taxation of interstate state commerce, forbidden by the constitution,' but it was also said what position they would have occupied 'had (they) simply transacted business for nonresident principals, is an entirely different question, which does not arise upon this record.'

If the questions here involved were controlled by those principles it would not be a difficult task for us to hold that the license here in question is not prohibited by the Commerce Clause of the Constitution. It is not subject to any of the prohibitions which the Supreme Court of the United States has laid down and does not exceed the limitations beyond which local laws must not extend.

But it has been distinctly held by the Supreme Court...