Federal Compress & Warehouse Co. v. McLean

Decision Date03 April 1933
Docket Number30543
Citation147 So. 325,166 Miss. 739
PartiesFEDERAL COMPRESS & WAREHOUSE CO. v. MCLEAN, SHERIFF
CourtMississippi Supreme Court

Division A

1 COMMERCE.

Privilege taxes imposed on operators of cotton compresses and warehouses held not violative of Federal Warehouse Act (Laws 1930, chapter 88, sections 3, 57, 63, 242; United States Warehouse Act [see 7 U.S.C. A., section 241 et seq.]).

2 COMMERCE.

Privilege taxes imposed on operators of cotton compresses and warehouses held not undue burden on interstate commerce since warehouse and compress are not instrumentalities of interstate commerce, in that assembling of cotton and its compression are acts preliminary but not absolutely essential to interstate transportation (Laws 1930, chapter 88, sections 3, 57, 63, 242, Constitution U.S. article 1, section 8 clause 3).

HON. WM. A. ALCORN, Judge.

APPEAL from circuit court of Bolivar county HON. WM. A. ALCORN, Judge.

Suit by the Federal Compress & Warehouse Company against E. R. McLean, Sheriff. From judgment for defendant on directed verdict, plaintiff appeals. Affirmed.

Affirmed.

Green, Green & Jackson, of Jackson, for appellant.

Section 57, chapter 88, Laws of 1930, is unconstitutional as a burden upon interstate commerce.

State ex rel. v. Grenada Cotton Compress, 85 So. 137, 123 Miss. 191; approved, State ex rel. v. Mississippi Power & Light Co., 138 So. 569, 162 Miss. 30; Conrad v. Miss. State Tax Commission, 133. So. 656, 160 Miss. 850; Pan American Petroleum Corporation v. Miller, 122 So. 396, 154 Miss. 565; Moore v. Standard Oil Co., 117 So. 371, 151 Miss. 23; Levee Board v. Howze, 116 So. 93, 149 Miss. 856; Planters Lumber Co. v. Wells, 112 So. 12, 146 Miss. 101.

Interstate and Foreign Commerce may not be burdened by a state privilege tax.

Miller v. G. M. & N. R. R. Co., 127 So. 692, 157 Miss. 69; Pullman Palace Car Co. v. Adams, 78 Miss. 814, 30 So. 757, 84 Am. St. Rep. 647; Postal Telegraph-Cable Co. v. Miller, 124 So. 434, 156 Miss. 522; Miller v. Illinois Central Railroad Co., 111 So. 559, 146 Miss. 442; City Sales Agency v. Smith, 88 So. 626, 126 Miss. 202; State Tax Commission of Mississippi v. Interstate Natural Gas Company, 284 U.S. 31, 76 L.Ed. 156; Helson v. Kentucky, 279 U.S. 250, 73 L.Ed. 687; Matthews v. Rogers, 284 U.S. 521, 76 L.Ed. 447.

That done by the Compress Company with and at its compress was interstate commerce.

Interstate Commerce Act, section 1, 49 U.S.C. A., page 11; Southern Railroad Co. v. Reed, 222. U.S. 424, 56 L.Ed. 257; Swift & Co. v. Hocking Valley R. Co., 112 N.E. 212, 93 Ohio St. 143, 243 U.S. 281, 61 L.Ed. 722; Railroad Co. v. Dettlebach, 239 U.S. 588, 60 L.Ed. 453; Commission v. Diffenbaugh, 222 U.S. 42, 56 L.Ed. 83; Omaha Elevator Co. v. Union Pacific Railroad Co., 249 F. 827; Oil Company v. Central Railroad of Georgia, 204 F. 476.

Concentration and compression has been regulated as interstate commerce.

Thomas Cotton Co. v. I. C. R. R., 62 I. C. C. 89, 92; Commission v. C. of G. Ry., 45 I. C. C. 516, 519; In re Cotton to Gulf Ports, 123 I. C. C. 685, 702; Savannah Traffic Bureau v. A. & R. R. R., 96 I. C. C. 749; New Orleans Cotton Exch. v. L. & N. R. R., 46 I. C. C. 712; Cotton from Tennessee River Landings, 120 I. C. C. 51; McFadden & Bros. Agency v. A. & R. R. R., 126 I. C. C. 519; Augusta Cotton Exch. v. G. & F. Ry., 146 I. C. C. 245; General Rate Structure Investigation, 17000, part 3, Cotton, page 605; Gregg Dyeing Co. v. Query, 286 U.S. 476, 76 L.Ed. 1236; Southern Pac. Co. v. Calexico, 288 F. 642; Omaha Elevator Co. v. Union Pac. R. Co., 249 F. 832; State v. S. A. & A. P. Ry. Co. (Tex.), 73 S.W. 575; Alabama G. S. R. Co. v. M'Fadden & Bros., 232 F. 1003; United States v. Gosho Co. (5 C. C. A.), 23 F.2d 675; Kellogg v. Railway Co., 204 A.D. 246; Harrington v. Missouri Pac. R. Co. (Kan.), 254 P. 380; Swift v. U.S. 196 U.S. 397, 49 L.Ed. 524; Stafford v. Wallace, 258 U.S. 495, 66 L.Ed. 735; Lamke-Farmer's Grain Co. case, 258 U.S. 53, 66 L.Ed. 461; Dahnke v. Bondurant, 257 U.S. 290, 66 L.Ed. 243; Board v. Olsen, 262 U.S. 1, 67 L.Ed. 839.

The movement of cotton from Mississippi through this plant to the outside world in and of itself is interstate commerce, an integral element in an ever moving stream, whose motion must be kept constant, otherwise its stuffing would dam the current and destroy the commerce.

People v. Perry (Cal.), 291. P. 237; Lawrence v. Commission, 286 U.S. 280, 76 L.Ed. 1106; Stafford v. Wallace, 258 U.S. 495, 66 L.Ed. 735; Board of Trade v. Olsen, 262 U.S. 1, 67 L.Ed. 839; Swetland v. Curtiss Airports, 41 F.2d 929; Railroad Commission v. C. B. & Q. R. Co., 257 U.S. 563, 588, 42 S.Ct. 232, 237, 66 L.Ed. 371, 22 A.L.R. 1086; Hohenberg v. L. & N. R. Co., 46 F.2d 952, at 955; Baltimore & Ohio S.W. R. Co. v. Settle, 260 U.S. 166, 43 S.Ct. 28, 67 L.Ed. 189; Greater New York Live Poultry Chamber of Commerce v. United States, 47 F.2d 156.

The privilege tax is inseparable and if applicable to any portion of interstate commerce is therefore void.

Ballard v. Miss. Cotton Oil Co., 81 Miss. 507; Bowman v. Continental Oil Co., 256 U.S. 642, 65 L.Ed. 1139.

Most of the cotton compressed has already been sold in interstate commerce and its compression is but a step in the delivery thereunder.

Sonneborn Bros. v. Keeling, 262 U.S. 515, 67 L.Ed. 1100.

We are dealing here with compression and the compress, that thereat done, not the storage of the cotton. Compression appertains solely to the interstate movement and conditions it. Without compression it would be impossible. It is feasible only through compression and where that so thus moving is moving pursuant to precedent sale, thereby it is unquestionably interstate commerce.

Foster-Fountain Packing Co. v. Haydel, 278 U.S. 10, 73 L.Ed. 153; Carson Petroleum Co. v. Vial, 279 U.S. 104, 73 L.Ed. 631; United States v. Erie R. Co., 280 U.S. 101, 74 L.Ed. 206; Western Cartridge Co. v. Emmerson, 281 U.S. 513, 74 L.Ed. 1007; United States v. Gosho Co. (5 C. C. A.), 23 F.2d 675; Harrington v. Mo. Pac. R. Co. (Kan.), 254 P. 380.

We submit that as the tax on compresses, which appertains solely to the movement in interstate commerce, is payable by the carrier for the conservation of space in their cars after the movement therein has begun, this tax is a direct burden upon interstate commerce and as such void.

Hughes Bros. Timber Co. v. Minn., 272 U.S. 469, 71 L.Ed. 259; Missouri Pacific v. Roy Strout, 267 U.S. 408, 69 L.Ed. 685.

Section 63, chapter 88, Laws of 1930, is unconstitutional being (a) undue burden as to cotton in interstate commerce; and (b) a direct tax upon a federal instrumentality.

Oregon-Washington R. & Nav. Co. v. Washington, 270 U.S. 87, 70 L.Ed. 483; Board of Trade v. Olsen, 262 U.S. 1, 67 L.Ed. 837, 850; Swift & Co. v. United States, 196 U.S. 375, 49 L.Ed. 518, 25 S.Ct. 276; Stafford v. Wallace, 258 U.S. 495, 66 L.Ed. 735; Carson Petroleum Co. v. Vial, 279 U.S. 104, 73 L.Ed. 631; M'Fadden v. A. G. S. R. Co., 241 F. 565; Chicago Portrait Co. v. Bellingham, 270 F. 584; State v. S. A. & A. P. Ry. Co. (Texas), 73 S.W. 575; Furst v. Brewster, 282 U.S. 498, 75 L.Ed. 481; Federal Trade Commission v. Pacific States P. T. Asso., 273 U.S. 64, 71 L.Ed. 539; Lemke v. Farmers' Grain Co., 258 U.S. 53, 66 L.Ed. 461; Dahnke-Walker Milling Co. v. Bondurant, 257 U.S. 290, 66 L.Ed. 243; Hump Hairpin Mfg. Co. v. Emmerson, 258 U.S. 294, 66 L.Ed. 625; Crescent Cotton Oil Co. v. Mississippi, 257 U.S. 136, 66 L.Ed. 170; Bowman v. Continental Oil Co., 256 U.S. 646, 65 L.Ed. 1144; Shafer v. Farmers Grain Co., 268 U.S. 198, 69 L.Ed. 914; Real Silk Hosiery Mills v. Portland, 268 U.S. 334, 69 L.Ed. 982; Ozark Pipe Line Corp. v. Monier, 266 U.S. 565, 69 L.Ed. 443; Flanagan v. Federal Coal Co., 267 U.S. 222, 69 L.Ed. 583; Binderup v. Pathe Exch., 263 U.S. 291, 309, 68 L.Ed. 308, 316, 44 S.Ct. 96; Texas Transport, etc. v. New Orleans, 264 U.S. 150, 68 L.Ed. 611; Southeastern Express Co. v. Miller, 264 U.S. 540, 68 L.Ed. 841; Atchison, T. & S. F. v. Harold, 241 U.S. 371, 60 L.Ed. 1050.

Where the United States has exercised its exclusive power over interstate commerce so far as to take possession of the field the states no more can supplement its requirements than they can annul them.

Pennsylvania R. Co. v. Commission, 250 U.S. 566, 63 L.Ed. 1143; Western Oil Refining Co. v. Lipscomb, 244 U.S. 346, 61 L.Ed. 1181.

This warehouse was thus a federal instrumentality, regulated and requisite, and so being, the state could not tax that therein done, because it was powerless to prohibit.

Independent Gin, etc. v. Dunwoody, 30 F.2d 307, 40 F.2d 1; Jaybird Mining Co. v. Wier, 271 U.S. 609, 70 L.Ed. 1114; New Jersey Bell Tel. Co. v. Board, 280 U.S. 346, 74 L.Ed. 467; T. & N. O. R. Co. v. Brotherhood, 281 U.S. 570, 74 L.Ed. 1046; Di Santo v. Pennsylvania, 273 U.S. 37, 71 L.Ed. 527; McFadden Rice Milling Co. v. T. & N. O. Ry. Co. (Tex.), 277 S.W. 193; Miller v. Illinois Cent. R. Co., 111 So. 558, 146 Miss. 422.

W. W. Pierce, Assistant Attorney-General, for appellee.

Until cotton is actually loaded and on its way to another state, or committed to a common carrier for transportation to such other state, it cannot be in interstate commerce and in a channel of interstate commerce. All of the authorities seem to agree with this proposition.

Coe v. Errol, 116 U.S. 517, 29 L.Ed. 715; Diamond Match Co. v. Village of Ontonagon, 188 U.S. 81, 47 L.Ed. 394. American Mfg. Co. v. St. Louis, 250 U.S. 459, 63 L.Ed. 1084, 198 S.W. 1183, 63 L.Ed. 1084; Crescent Cotton Oil Co. v. State of Mississippi, 257 U.S. 129, 66 L.Ed. 166; Carson Petroleum Co. v. Vial, 279 U.S. 94, 75 L.Ed. 626.

The beginning of the transit which constitutes interstate commerce is defined in Coe v. Errol to be the point of time that an article is...

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    • United States
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    ... ... commerce, and that determines federal or state control over ... it. Goods take character as interstate or ... the compress by wagon, automobile, or truck, and of cotton ... which has been ... these cotton buyers; otherwise this federal warehouse, ... created as an instrumentality of interstate commerce, would ... & Warehouse Co. v. McLean, Sheriff, 147 So. 325; ... Hope Natural Gas Co. v. Hall, 274 U.S. 284, ... ...
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    ... ... legislature transcend the limits imposed by the federal and ... state constitutions the courts should proceed with the ... Federal Compress & Warehouse Company v. McLean, 166 Miss ... 739, 147 So. 325, 326, ... ...
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    ...as a forbidden imposition upon a federal instrumentality, and as infringing the commerce clause of the Federal Constitution. 166 Miss. 739, 147 So. 325. Sections 3, 57, 220, 221, 225, 242, of chapter 88, of the General Laws of Mississippi of 1930, exact an annual license tax for the privile......
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