Johnson, Lytle & Co. v. Spartan Mills

• Decision Date: 28 March 1904
• Parties: JOHNSON, LYTLE & CO. v. SPARTAN MILLS.
• Court: South Carolina Supreme Court

47 S.E. 695

68 S.C. 339

JOHNSON, LYTLE & CO. v. SPARTAN MILLS.

Supreme Court of South Carolina

March 28, 1904

Appeal from Common Pleas Circuit Court of Spartanburg County; Purdy Judge.

Action by Johnson, Lytle & Co. against the Spartan Mills. From a judgment for defendant, plaintiffs appeal. Affirmed.

The decision on circuit is as follows:

"The defendant is a corporation engaged in cotton manufacturing in Spartanburg county, in this state, and the plaintiffs are merchants in the same county. The plaintiffs commenced eight actions in the magistrate's court against the defendant, asking judgment for the sum stated in each complaint, and aggregating about $716. As the same principle is involved in all of the cases, and the same testimony will be applicable to all, it was agreed that the testimony taken in one case should answer for all the cases.

The complaints in each case are similar, and each, in substance, is as follows: After setting out the copartnership of the plaintiffs, they allege that the defendant is indebted to the plaintiffs in the sum stated in each complaint, with interest from March 12, 1902, for certain redeemable brass or metal checks held by and belonging to them, and issued by the defendant, aggregating the amount stated in the complaint and which were presented to the defendant for payment on March 12, 1902, a regular pay day, and payment refused, in violation of an act of the General Assembly of this state appearing at page 746 of the Acts of 1901. The defendant appeared and put in a general denial, and pleaded the unconstitutionality of the act referred to, alleging that it is in violation of both the state and federal Constitutions. The magistrate gave judgment in each case in favor of the plaintiffs, and the defendant excepted upon the various grounds set out in its notice, which it is unnecessary to repeat in full, as the notice is in the record; but it may be said that some of the exceptions impute error to the magistrate in assuming that the checks were issued in payment for labor, and in not holding that the act was unconstitutional, in that it does not give all persons the equal protection of the law, does not apply to all laborers, and it takes property from a citizen without due process of law, and limits and interferes with the liberty of the citizen, in that it prevents him from freely and in his own way entering into contracts with others, when this liberty is allowed to all persons engaged in agricultural pursuits; that the magistrate erred in deciding that the plaintiffs were entitled to judgment in money equal to the amount of the checks, and erred in not holding that the plaintiffs, if entitled to judgment at all, could only recover the value of the checks, payable in merchandise and not in money, and erred in not holding that the plaintiffs could not sue the defendant at all, because the act fixes the penalty for its violation, and erred in holding that judgment could be obtained against the defendant for any sum other than for the penalty provided by the act. The act is entitled 'An act to protect laborers in their wages, and to repeal inconsistent acts,' and the body of the act is found in the first volume of the Code of 1902 (sections 2719 and 2720), as follows:

'Sec. 2719. It shall not be lawful for any corporation person or firm in this state to issue, pay out or circulate for payment for the wages of labor, any order, check memorandum, token or evidence of indebtedness payable in whole or in part otherwise than in lawful money of the United States, unless the same is negotiable in cash or in goods, wares or merchandise or supplies, at the option of the holder, at the store or other place of business of such firm, person or corporation, or at the store of any other person on whom such paper may be drawn, where goods, wares or merchandise are kept for sale, sold or exchanged; and the person who, or corporation, firm or company which, may issue any such order, check, memorandum, token or other evidence of indebtedness, shall, upon presentation and demand, within thirty days from date of delivery thereof, redeem the same in goods, wares, merchandise or supplies, or in lawful money of the United States, as may be demanded by the holder of any such order, memorandum, token or other evidence of indebtedness: provided, that if said corporation, person or firm engaged as specified in this section have a regular pay day once in every thirty days, then said corporation, person or firm shall not be required to redeem such token or evidence of indebtedness in cash until the first pay day after the same becomes payable, as herein provided, and such token or evidence of indebtedness shall be presented for payment in cash only on such pay day: provided, that the provisions of this section shall not apply to agricultural contracts or advances made for agricultural purposes.

Sec. 2720. Any officer or agent of any corporation, or any person, firm or company engaged in the business of manufacturing or mining in this state, who by themselves or agent shall issue or circulate in payment for wages of labor any order, check, memorandum, token or evidence of indebtedness, payable in whole or in part otherwise than in lawful money of the United States, without being negotiable and payable at the option of the holder in goods, wares, merchandise, supplies or lawful money of the United States, as required by section 2719, or who shall fail to redeem the same when presented for payment within thirty days from date or delivery thereof, by the said company or its agent at his or their office or place of business, in lawful money of the United States, or who shall compel or attempt to coerce any employee of any such corporation, shall forfeit to the employee $50, to be recovered in court of competent jurisdiction.'

It should have been stated that the checks in question have on one side of them the statement that they are issued for the convenience of employés, and on the other side that they are payable in merchandise at the Spartan Mills.

The first question that presents itself under the exceptions is whether any other person than the laborer or employé has a right to sue. The contention of the plaintiffs is that the word 'holder,' as used in the statute, refers to any person who may have the custody of the checks at the time they are presented for payment, while the defendant contends that the act, as shown by its terms and by its preamble, is intended solely for the protection of laborers. It is proper, and ofttimes necessary, to refer to the preamble of an act in order to assist in the construction of its terms, and, upon referring to the preamble in this case, it is designated 'An act for the protection of laborers,' and the only thing in the act that points to any other conclusion is the use of the word 'holder' in the body of the act, which, taken by itself, will indicate that it had reference to the person who had possession of the check. When we take into consideration the preamble of the act, from which we gather its purport and purpose, and consider that, with the main body of the act, and with the concluding clause of section 2720, we come to the conclusion that the terms 'holder,' 'laborer' and 'employee' are all used in the same sense--in fact, bear but a single meaning, and all point to the person who performs the labor. This is manifestly so, for the reason that the Legislature can have no intention to protect outsiders dealing with the laborer, but its manifest intention was to protect the laborer dealing with his employer. But suppose that this should not be so; what rights would the holder of the check have? He would have clearly such rights as the statute gave him, for, when a statute undertakes to make a declaration concerning any subject, that is the whole on that subject. Here it has undertaken to say that 'it shall not be lawful for any corporation, person or firm in this state to issue, pay out or circulate for payment for the wages of labor, any order, check, memorandum, token or evidence of indebtedness, payable in whole or in part otherwise than in lawful money of the United States, unless the same is negotiable and redeemable at its face value, without discount in cash or in goods, wares or merchandise or supplies at the option of the holder ***' While it makes the declaration that this shall not be done, yet at the same time it does not declare such contract to be void and not enforceable, nor does it provide that, in the case of the failure to carry out the requirements of the act, the holder of the check, memorandum, or token shall have the right to recover a judgment based upon such check, memorandum, or token. Then whence does this right arise? The plaintiff in this case alleges that the defendant became indebted to the plaintiffs for certain brass checks issued and redeemable under this act. Now, in order to become indebted to the plaintiffs, there must have been some contract, express or implied. There was no express contract on the part of the defendant to pay these checks in money, and there was no implied contract to pay them in money, because an implied contract of indebtedness could not be inferred from the nature of the check itself, which expressly says that the same shall be payable in merchandise, and there are none of the elements of an implied contract in the transaction, and, as stated, the statute does not give any right to the holder to bring an action against the defendant in case of his failure to pay in money. The act was designed to protect the laborer, by preventing the employer from issuing these tokens in payment for labor, and then coercing the laborer to take the same in merchandise instead of money, and it was not designed to enable such persons as

...