Danciger v. Cooley

• Decision Date: 07 January 1919
• Docket Number: No. 37,37
• Parties: DANCIGER et al. v. COOLEY
• Court: U.S. Supreme Court

248 U.S. 319

39 S.Ct. 119

63 L.Ed. 266

DANCIGER et al.

v COOLEY.

No. 37.

Submitted Nov. 14, 1918.

Decided Jan. 7, 1919.

Mr. Edwin A. Krauthoff, of Washington, D. C., for plaintiffs in error.

[Argument of Counsel from pages 319-321 intentionally omitted] Mr. Edwin A. Austin, of Topeka, Kan., for defendant in error.

Mr. Justice VAN DEVANTER delivered the opinion of the Court.

Danciger Bros., who conducted a mail-order liquor business in Kansas City, Missouri, brought this suit in a Kansas court to recover from Cooley certain moneys collected by him, under an arrangement with them, as the purchase price of intoxicating liquors sold by them in interstate commerce, and also to enforce a similar claim assigned to them by anothr liquor dealer. After issue and trial Cooley prevailed and the judgment was affirmed; the appellate court holding that the arrangement under which the moneys were collected involved a violation of section 239 of the Criminal Code of the United States (Act March 4, 1909, c. 321, 35 Stat. 1136 [Comp. St. § 10409]), and that, applying the settled rule of the Kansas courts, a principal who employs an agent to make collections in violation of a criminal law cannot compel the agent to account for what he collects. 98 Kan. 38, 484, 157 Pac. 453, 158 Pac. 1119. The case is here on writ of error sued out prior to the Act of September 6, 1916, c. 448, 39 Stat. 726.

These are the facts: During the year 1910 Danciger Bros. received through the mails several orders for whisky from customers in Topeka, Kansas, and in each instance shipped the liquor from Kansas City, Missouri, to Topeka as freight. Each package was consigned to the shipper's order and was to be delivered by the carrier only on the surrender of the bill of lading properly indorsed. A sight draft was drawn on the customer for the purchase price and this with the bill of lading attached was sent to Cooley under an arrangement whereby he was to collect the draft, was then to hand the bill of lading suitably indorsed to the customer to enable the latter to get the package from the carrier, and ultimately was to remit to Danciger Bros. The amount collected less a commission for the service rendered. Before this arrangement was made the banks had refused to make such collections.

The assigned claim need not be separately described, for it was essentially like the other.

As the transactions occurred before the passage of the Webb-Kenyou Act, March 1, 1913, c. 90, 37 Stat. 699 (Comp. St. § 8739), we are not concerned with it, but only with the situation therefore existing.

Whether section 239 of the Criminal Code reaches and embraces acts done by an agent such as Cooley was in this instance, or is confined to acts of common carriers and their agents, is a question about which there has been some contrariety of opinion, and it is now before this court for the first time. Of course, the chief factor in its solution must be the words of the statute. Omitting what is irrelevant here, they are:

'Sec. 239. Any railroad company, express company, or other common carrier, or any other person who, in connection with the transportation of any * * * intoxicating liquor * * * from one state * * * into another state, * * * shall collect the purchase price or any part thereof, before, on, or after delivery, from the consignee, or from any other person, or shall in any manner act as the agent of the buyer or seller of any such liquor, for the purpose of buying or selling or completing the sale thereof, saving only in the actual transportation and delivery of the same, shall be fined,' etc.

A reference to the conditions existing when the section was enacted, in 1909, will, together with its words, conduce to a right understanding of the evil at which it is aimed and the relief it is intended to afford. The conditions were these: In some of the states there were state-wide laws prohibiting the manufacture and sale of intoxicating liquor; in some there was a like prohibition operative only in particular districts, and in other states the business was lawful. But the prohibitory laws did not reach sales or transportation in interstate commerce, for under the Constitution of the United States that was a matter which only Congress could regulate. True, there was a regulation by Congress, known as the Wilson Act Aug. 8, 1890, c. 728, 26 Stat. 313 (Comp. St. § 8738), which subjected liquor transported into a state to the operation of the laws of the state enacted in the exercise of its police power, but the time when the liquor was thus to come within the operation of those laws was after the shipment arrived at the point of destination and was there delivered by the carrier. Rhodes v. Iowa, 170 U. S. 412, 426, 18 Sup. Ct. 664, 42 L. Ed. 1088. Thus a state, although able effectively to prohibit the manufacture and sale of liquor within its own territory, was unable to prevent its introduction from other states through the channels of interstate commerce. Of course, the real purpose of the prohibitory laws was to prevent the use of liquor by cutting off the means of obtaining it. But with the channels of interstate commerce open those laws were failing in their purpose, for dealers in states where it was lawful to sell were supplying the wants of intending users in states where manufacture and sale were prohibited. This interstate business generally was carried on by means of orders transmitted through the mails and of shipments made according to some plan whereby ultimate delivery was dependent on payment of the purchase price. The plans varied in detail, but not in principle or result. All included the collection of the purchase price at the point of destination before or on delivery. One made the carrier having the shipment the collecting agent; another committed the collections to a separate carrier, the liquor being forwarded as railroad freight and the bill of lading being sent to an express company with instructions to hand it to the buyer when the money was paid; and still another made use of an agent, such as Cooley was here, the bill of lading being sent to him with a sight draft on the buyer for the purchase price. In some instances the liquor was consigned to the buyer and in others to the shipper's order, the bill of lading then being suitably indorsed by the shipper.

Where the transactions were real and not merely colorable, the business so conducted was lawful interstate commerce and entitled to protection as such until the sale and transportation were consummated by the delivery of the liquor to the vendee at the point of destination. Such was the decision of this court in American Express Co. v. Iowa, 196 U. S. 133, 25...