Milk Adm'r v. Leinert.

• Decision Date: 06 March 1946
• Citation: 46 A.2d 420,132 Conn. 596
• Court: Connecticut Supreme Court
• Parties: HAMMERBERG, Milk Administrator, v. LEINERT.

132 Conn. 596

46 A.2d 420

HAMMERBERG, Milk Administrator,

v.LEINERT.

Supreme Court of Errors of Connecticut.

March 6, 1946.

Appeal from Superior Court, Fairfield County; Comley, Judge.

Action by Donald O. Hammerberg, Milk Administrator, against Frank Leinert for an injunction commanding defendant to pay all amounts claimed to be due under a price order of the Administrator brought to superior court and tried to the court. Judgment for defendant and appeal by plaintiff.

Error, and case remanded with directions.

Bernard A. Kosicki, Asst. Atty. Gen., and Jack Rubin, of Hartford (William L. Hadden, Atty. Gen., on the brief), for appellant.

George F. Hanrahan, of Hartford, for appellee.

Before MALTBIE, C. J., and BROWN, JENNINGS, ELLS, and DICKENSON, JJ.

BROWN, Justice.

The plaintiff as milk administrator brought this action under the Milk Marketing Act (General Statutes, Supp.1941, Chap. 107b), alleging the defendant's refusal to pay amounts due to his producers, under the plaintiff's order issued by virtue of the act, for the period from February, 1942, to April, 1943, and asking an injunction to compel the defendant to comply therewith. From the court's judgment for the defendant denying the injunctive relief sought, the plaintiff has appealed.

The essential facts are undisputed. The defendant is a ‘dealer’ under the act, § 335f, engaged in buying, selling and distributing milk in Darien. As such he was subject to the provisions of a valid order, duly issued by the plaintiff, which in its amended form became effective on January 1, 1942. This established minimum prices to be paid for milk bought by ‘dealers' in that area from farmers who were the ‘producers.’ From February 1, 1942, to April 30, 1943, inclusive, the defendant paid his producers 4,330.72 less than he should have paid them for milk which they delivered to him, as computed under the provisions of the order. Up to the time of judgment, the defendant had neglected and refused to pay this money to them, and to that extent had failed to comply with the terms of the order. Such a failure tends to hamper the effective administration of the act and gives the defendant an unfair advantage over dealers in competition with him who pay the minimum prices ordered. It did not appear that the defendant intended to evade liability for the underpayments in question, or that he intended to commit any future violation of the plaintiff's existing orders; nor did it appear that any producer affected by the defendant's underpayments had either made demand for any additional sum or been refused payment of such sum by him. The plaintiff had issued no order that amounts found to be due producers be paid to him as administrator.

The defendant concedes that he is indebted to his producers in the aggregate amount above stated and that he should pay them the amounts respectively due. His claims are comprehended in the single proposition that the plaintiff is not entitled to enforce payment by injunction, and this presents the vital question for determination. Since neither law nor equity, with scant exceptions not here involved, recognizes a right in one person to compel another to perform an obligation the latter owes to a third, the plaintiff's right to the injunctive relief which the trial court denied cannot exist under the general equity powers of the court but only by virtue of the statutory provision. The defendant concedes that the statute is valid. This concession finds justification in abundant authority. See Carroll v. Schwartz, 127 Conn. 126, 128, 14 A.2d 754; Burroughs Wellcome & Co. v. Johnson Wholesale Perfume Co., 128 Conn. 596, 604, 24 A.2d 841; United States v. Stevens, 103 Conn. 7, 18, 130 A. 249; State Board of Milk Control v. Newark Milk Co., 118 N.J.Eq. 504, 513, 179 A. 116; United States v. Rock Royal Co-operative, Inc., 307 U.S. 533, 59 S.Ct. 993, 83 L.Ed. 1446; H. P. Hood & Sons, Inc. v. United States, 307 U.S. 588, 59 S.Ct. 1019, 83 L.Ed. 1478; Elm Spring Farm v. United States, 1 Cir., 127 F.2d 920, 925, 928; American Fruit Growers v. United States, 9 Cir., 105 F.2d 722, 725; United States v. Adler's Creamery, 2 Cir., 110 F.2d 482; United States v. Adler's Creamery, 2 Cir., 107 F.2d 987, 990; United States v. Ridgeland Creamery Co., D.C. 47 F.Supp. 145, 150; 50 Harv.L.Rev. 171, 225. The validity of the plaintiff's order, issued pursuant to the statute, is also conceded. The decisive issue therefore is narrowed to whether, upon the undisputed facts, the court, in the exercise of equitable powers conferred upon it by the statute, abused its discretion by refusing to grant an injunction. In its solution, the nature of the defendant's admitted obligation under the act becomes important. See Burroughs Wellcome & Co. v. Johnson Wholesale Perfume Co., supra. This involves a consideration of the purpose of the act and the reasons for its enactment as stated in it.

Section 334f recites that the production, sale and distribution of milk and milk products in this state are attended with serious conditions and practices affecting producers, dealers and consumers, and, briefly summarized, expressly declares as follows: The maintenance of a constant and wholesome supply of milk safeguarded by the essential costly sanitary requirements is vital for the promotion of the public health; the public health is menaced when consumers are not assured of a constant and sufficient supply of pure, wholesome milk, a situation which occurs when dealers do not or cannot pay a price to producers commensurate with the cost of sanitary conditions of production and high standards of purity; to avoid the ‘unfair, unreasonable and demoralizing trade and price practices, detrimental to the public health,’ naturally incident to the widely varying surpluses of fluid milk in dealers' nands for which they must ‘find an immediate market,’ which ‘excess milk is normally diverted into other uses at lower prices,’ producers who sell to dealers ‘should receive a proportionate share of the proceeds from the sale of milk in fluid form and in the lower price outlets,’ if ‘stable market conditions and equitable treatment of producers are to be assured’; producers ‘are required to make delivery of this highly perishable commodity immediately after it is produced and therefore must often accept any market at any price’; because of the above facts ‘the value of milk cannot be determined until the dealer has sold’ it ‘in fluid form or has disposed of it in surplus outlets,’ with the result that ‘prior and often exclusive knowledge of the value of milk is in the possession of the dealer’; ‘the producers' lack of control over their market is aggravated by the trade custom’ of substantial delay in payments by the dealers, which often compels producers to continue delivery to insure receipt of payments already due and permits ‘dealers to operate on the producers' capital without giving security therefor’; ‘hence, milk producers are subject to fraud and imposition, and do not possess the freedom of contract necessary for the procuring of cost of sanitary production’; the foregoing ‘conditions and practices pertain to and exist in a paramount industry upon which’ the public health and welfare are largely dependent, and the public interest requires their amelioration. The statute conclude: ‘In exercise of the state police power to protect and promote the public health and welfare and to prevent fraud and imposition upon producers, such conditions and practices require control and regulation of the production, transportation, manufacture, processing, storage, distribution, sale and handling of milk as a business affecting the public health and interest.’

It is to meet this need that the act goes on to provide for the appointment of a milk administrator and to confer upon him ‘power to investigate and regulate all phases of the milk industry in this state.’ Section 337f(c) expressly empowers him ‘to issue orders prescribing minimum prices to producers.’ The reasons for this enactment and its purpose, as shown by the above provisions, make clear that the obligation of the defendant arising under it, which is the obligation concerned in this...