General Oil Co. v. Crain

• Decision Date: 30 June 1906
• Citation: 95 S.W. 824,117 Tenn. 82
• Parties: GENERAL OIL CO. v. CRAIN.
• Court: Tennessee Supreme Court

95 S.W. 824

117 Tenn. 82

GENERAL OIL CO. v. CRAIN.

Supreme Court of Tennessee.

June 30, 1906

Appeal from Chancery Court, Shelby County; F. H. Heiskell Chancellor.

Action by the General Oil Company against John H. Crain. From a decree in favor of complainant, defendant appeals. Reversed and remanded.

Thomas H. Jackson and Chas. T. Cates, Jr., Atty. Gen., for appellant.

Turley & Turley and H. J. Livingston, Jr., for appellees.

BEARD J.

The complainant is a corporation chartered under the laws of Tennessee, with its situs in Memphis, in this state, and the defendant, Crain, is a resident of Shelby county and the duly appointed, qualified, and acting inspector of coal oil and other illuminating fluids for that county, under and by virtue of chapter 349, p. 811, of the Session Acts of 1899 of the Legislature of Tennessee.

The bill alleges that complainant is the owner of oil wells and refining plants in the states of Pennsylvania and Ohio, and for several years prior to the institution of this suit had been engaged in the manufacture, shipment, and sale of coal oil and other illuminants, and in carrying on this business it used Memphis not only as a place for the sale of its oils to the citizens thereof, but also as one of its distributing plants, to which it shipped the product of its wells and plants in railroad tank cars, from which the oil was unloaded and then placed in various vessels for shipment to complainants' customers in Arkansas, Louisiana, and Mississippi.

The bill further alleges that complainant has, at its place of business in Memphis, numerous tanks of oil among which are two described as follows:

"(1) A tank or vessel in which complainant constantly keeps, and will keep, and in which there now is, only oil for which orders have been received from customers of complainant in Arkansas, Louisiana, and Mississippi, before said oil was shipped from complainant's plants in Pennsylvania and Ohio, and which was shipped especially to fill said orders. This oil is unloaded in Memphis from the railroad tank cars solely for the purpose of distribution into smaller vessels, or receptacles, to meet the requirements of said orders, and said oil is, and has always been, kept wholly separate and distinct from other oils and fluids of complainant in the state of Tennessee, in a tank plainly and conspicuously marked, 'Oil already sold in Arkansas, Louisiana, and Mississippi,' and, of course complainant has sold, and will sell, none of this oil in the state of Tennessee, since the same has already been sold to customers in Arkansas, Louisiana, and Mississippi in fact, this oil has remained, and will remain, in Shelby county, in the state of Tennessee, only long enough to be properly distributed, and reshipped, according to the orders therefor, whereupon it will proceed at once upon its journey to the various places in the states of Arkansas, Louisiana, and Mississippi, from which said orders were received. This will be only a few days.

"(2) In another tank or vessel, at its place of business in Memphis, complainant has now and constantly keeps, and will keep, only oil shipped from Pennsylvania and Ohio for sale in the states of Arkansas, Louisiana, and Mississippi, but for which complainant has no orders on hand from said states at the time of such shipments. This oil, as soon as it reaches Memphis in the railroad tank car, is placed in said tank or vessel, which is plainly and conspicuously marked, 'Oil to be sold in Arkansas, Louisiana, and Mississippi', and is there kept wholly separate and apart from all other oil, until required to supply orders received from complainants' Arkansas, Louisiana, and Mississippi customers; and complainant never sells or offers for sale any oil from this tank except upon orders from Arkansas, Louisiana, and Mississippi, upon receipt of which complainant ships said oil to the persons sending said orders."

With regard to these tanks, which are thus designated Nos. 1 and 2, it is alleged that, at the time of the filing of the bill, as well as for a period of time previous thereto, they contained "and will hereafter contain only oil as above described, unmixed with oil held for any other purpose, and that complainant has never placed in either of said tanks any oil other than as above described, nor has complainant ever sold, or offered to sell, oil from these tanks except in the manner and to the persons above mentioned."

It is further alleged that the defendant, Crain, in his official capacity is engaged in the inspection of oil and other illuminating fluids, of complainant's in Memphis, receiving for such inspection a fee of 25 cents per barrel, as provided by section 8, p. 814, c. 349, of the Acts of 1899, already referred to, and that he was then claiming the right under the provision of that act to inspect the oil in tanks Nos. 1 and 2, and was in the act of exercising this right, although it had been separated in the manner above alleged.

The complainant then charged "that none of the oil now in, or to be placed therein hereafter, is subject to inspection under the Tennessee law, and that the defendant, Crain, has no right or power to inspect any of said oil or collect fees for such inspection for the following reasons: '(1) Because none of said oil is covered by the language or intention of the act referred to, which is the present coal oil inspection law of Tennessee. (2) If, however, said act, when properly construed, provides for the inspection of the oil in either of said tanks"' then it is alleged that, in so far as it has that effect, it is unconstitutional and void because a regulation of interstate commerce in violation of section 8 of article 1 of the Constitution of the United States.

It is also further charged that if the act of 1899 be held to apply to any of the oil in these two tanks, then it cannot be sustained as a valid exercise of the police power: (1) Because an inspection of these oils was unnecessary to protect either the residents of Tennessee or the reputation of the manufactured products of this state. (2) The inspection fee provided by the act was unreasonable in that it was much greater than was necessary to provide for the expense of inspection. (3) That as an inspection of these oils would in no way conduce to the health, happiness, morals, or safety of the citizens of the state, the inspection fee so imposed was a mere tax under the guise of a police regulation and as such was in conflict with article 2, § 28, of the Constitution of Tennessee, which requires uniformity of taxes throughout the state.

The bill alleged, as an excuse for coming into the chancery court, asking for a decree adjudging its status as to the oil in these two tanks, and invoking its protection in the form of injunctive relief, the peril complainant would incur, under the act of 1899, in obstructing the coal oil inspector in the discharge of his duty, and in selling the oil in these tanks whether the inspection fees, if paid under protest, could be recovered by the complainant, or if this could be done, it was alleged this would only be bringing, within 30 days after each payment, a suit for recovery thereof, thus necessitating an indefinite number of suits.

The bill...