Joseph Lemieux v. James Young, 48

• Court: United States Supreme Court
• Citation: 211 U.S. 489,29 S.Ct. 174,53 L.Ed. 295
• Docket Number: No. 48,48
• Parties: JOSEPH A. LEMIEUX, Plff. in Err., v. JAMES M. YOUNG, Trustee
• Decision Date: 04 January 1909

211 U.S. 489 29 S.Ct. 174 53 L.Ed. 295 JOSEPH A. LEMIEUX, Plff. in Err.,

v.

JAMES M. YOUNG, Trustee.

No. 48. Argued December 9, 1908. Decided January 4, 1909.

Messrs. John J. Phelan and Charles F. Thayer for plaintiff in error.

[Argument of Counsel from page 489 intentionally omitted]

Page 490

Mr. Donald G. Perkins for defendant in error.

[Argument of Counsel from page 490 intentionally omitted]

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Mr. Justice White delivered the opinion of the court:

Whether the following provisions of the general laws of Connecticut are repugnant to the 14th Amendment because wanting in due process of law and denying the equal protection of the laws is the question for decision:

'Sec. 4868, as amended by chapter 72 of the public acts of Connecticut of 1903. No person who makes it his business to buy commodities and sell the same in small quantities, for the purpose of making a profit, shall, at a single transaction, and not in the regular course of business, sell, assign, or deliver the whole, or a large part of his stock in trade, unless he shall, not less than seven days previous to such sale, assignment, or delivery, cause to be recorded in the town clerk's office in the town in which such vendor conducts his said business, a notice of his intention to make such sale, assignment, or delivery, which notice shall be in writing, describing in general terms the property to be so sold, assigned, or delivered, and all conditions of such sale, assignment, or delivery, and the parties thereto.

'Sec. 4869. All such sales, assignments, or deliveries of commodities which shall be made without the formalities required by the provisions of § 4868 shall be void as against

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all persons who were creditors of the vendor at the time of such transaction.'

The controversy thus arose. Philip E. Hendrick conducted a retail drug store at Taftville, Connecticut. While engaged in such business, in August, 1904, he sold his stock in bulk to Joseph A. Lemieux, his clerk, for a small cash payment and his personal negotiable notes. The sale was made without compliance with the requirements of the statute above quoted. Subsequently Hendricks was adjudicated a bankrupt, and the trustee of his estate commenced this action against Lemieux and replevied the stock of goods. Among other grounds the trustee based his right to recover upon the noncompliance with the statutory requirements in question. In the trial one of the grounds upon which Lemieux relied was the assertion that the statute was void for repugnancy to the 14th Amendment to the Constitution of the United States, because wanting in due process of law and denying the equal protection of the laws. The trial court adjudged in favor of the trustee, and his action in so doing was affirmed by the supreme court of errors of Connecticut, to which the case was taken on appeal. 79 Conn. 434, 65 Atl. 436, 600, 8 A. & E. Ann. Cas. 452. The cause was then brought to this court.

The supreme court of errors, in upholding the validity of the statute, decided that the subject with which it dealt was within the police power of the state, as the statute alone sought to regulate the manner of disposing of a stock in trade outside of the regular course of business, by methods which, if uncontrolled, were often resorted to for the consummation of fraud, to the injury of innocent creditors. In considering whether the requirements of the statute were so onerous and restrictive as to be repugnant to the 14th Amendment, the court said:

'It does not seem to us, either from a consideration of the requirements themselves of the act, or of the facts of the case before us, that the restrictions placed by the legislature upon sales of the kind in question are such as will cause such serious inconvenience to those affected by them as will amount to any

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unconstitutional deprivation of property. A retail dealer who owes no debts may lawfully sell his entire stock without giving the required notice. One who is indebted may make a valid sale without such notice, by paying his debts, even after the sale is made. Insolvent and fraudulent vendors are those who will be chiefly affected by the act, and it is for the protection of creditors against sales by them of their entire stock at a single transaction, and not in the regular course of business, that its provisions are aimed. It is, of course, possible that an honest and solvent retail dealer might, in consequence of the required notice before the sale, lose an opportunity of selling his business, or suffer some loss from the delay of a sale, occasioned by the giving of such notice. But a 'possible application to extreme cases' is not the test of the reasonableness of public rules and regulations. Com. v. Plaisted, 148 Mass. 375, 382, 2 L.R.A. 142, 12 Am. St. Rep. 566, 19 N. E. 224. 'The essential quality of the police power as a governmental agency is that it imposes upon persons and property burdens designed to promote the safety and welfare of the general public.' Chicago, B. & Q. R. Co. v. State, 47 Neb. 549, 564, 41 L.R.A. 481, 53 Am. St. Rep. 557, 66...