Pennsylvania-Dixie Cement Corp. v. H. Wales Lines Co.

• Decision Date: 03 April 1935
• Citation: 119 Conn. 603,178 A. 659
• Court: Connecticut Supreme Court
• Parties: PENNSYLVANIA-DIXIE CEMENT CORPORATION v. H. WALES LINES CO.

178 A. 659

119 Conn. 603

PENNSYLVANIA-DIXIE CEMENT CORPORATION v. H. WALES LINES CO.

Supreme Court of Errors of Connecticut.

April 3, 1935

Appeal from Superior Court, New Haven County; Ernest A. Inglis Judge.

Action to recover for goods sold and delivered by the Pennsylvania-Dixie Cement Corporation against the H. Wales Lines Company, which filed a counterclaim. A demurrer to a second special defense was sustained, and the case was referred to a state referee, who heard the parties and reported the facts. From a judgment for plaintiff, defendant appeals.

No error.

Argued before MALTBIE, C.J., and HAINES, HINMAN, BANKS, and AVERY JJ.

Cornelius J. Danaher, of Meriden, for appellant.

W Arthur Countryman, Jr., of Hartford, for appellee.

BANKS Judge.

This was an action brought upon the common counts to recover the purchase price of cement alleged to have been sold and delivered by the plaintiff to the defendant. In a second special defense by way of counterclaim, the defendant alleged that for nearly thirty years it had been the sold distributor of Dexter and other cements in the New England states under a contract with the plaintiff and its predecessors in title, which contract the plaintiff had wrongfully canceled on or about August 20, 1932; that on or about that date the plaintiff entered into a combination and conspiracy with other cement companies in violation of the laws of the United States for the purpose of controlling the trade in cement and preventing the defendant from purchasing or distributing cement in such states; that because of such conduct the business of the defendant as a distributor and dealer in cement was wholly destroyed; and claimed treble damages. The plaintiff demurred to this defense by way of counterclaim upon the ground that it was based upon a statute of the United States, jurisdiction to enforce which is by the terms of the statute solely in the District Court of the United States and the defendant assigns error in the action of the trial court in sustaining this demurrer.

The counterclaim states a cause of action for the violation of the provisions of the anti-trust laws commonly known as the Sherman Anti-Trust Act (15 USCA § 1 et seq.) and Clayton Act (38 Stat. 730). The section of the statute under which the defendant claims treble damages reads as follows: " Any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws may sue therefor in any district court of the United States in the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the cost of suit, including a reasonable attorney's fee." 15 USCA § 15. The remedy here provided has been held to be one for which recovery can be had only in the federal courts. " The action is wholly statutory, and can only be brought in a District Court of the United States." Blumenstock Brothers Advertising Agency v. Curtis Publishing Co., 252 U.S. 436, 440, 441, 40 S.Ct. 385, 386, 64 L.Ed. 649; D. E. Loewe & Co. v. Lawlor (C. C.) 130 F. 633, 634; Hand v. Kansas City Southern Ry. Co. (D. C.) 55 F.(2d) 712, 713. In Mondou v. New York, N.H. & H. R. Co., 223 U.S. 1, 32 S.Ct. 169, 56 L.Ed. 327, 38 L.R.A. (N. S.) 44, cited by the defendant, the question of jurisdiction involved was that arising under the Federal Employers' Liability Act (section 6 as amended) which provided that the jurisdiction of the federal courts under the act should be " concurrent with that of the courts of the several States." 45 USCA § 56. If an act of Congress gives a penalty to the party aggrieved, without specifying a remedy for the enforcement, it may be enforced by an action in the state court. Claflin v. Houseman, 93 U.S. 130, 137, 23 L.Ed. 833. The anti-trust laws provide a specific remedy for their breach, and the trial court did not err in sustaining the demurrer to the counterclaim upon the ground that the cause of action there set forth was cognizable only in the federal courts.

The defendant also assigned as error the action of the trial court " in ruling and holding that the matter set forth in the second special defense could not be urged as a ground of defense" in this action. Both parties have assumed that, apart from the question of jurisdiction, the ruling upon the demurrer raised the question of whether the violation of the anti-trust laws alleged in this defense constituted a good defense to the cause of action set up in the complaint, the defendant claiming that upon the allegations of this defense the contract between the parties was illegal because of violation of the anti-trust laws, and the plaintiff that the contract upon which this action is brought was not one made in violation of the anti-trust laws but was collateral to the alleged conspiracy, and that there is nothing in the anti-trust acts which invalidates such a collateral contract or relieves the buyer from his obligations under it. The allegations of this second defense were pleaded, not as a defense, but " by way of counterclaim," and the only question raised by the demurrer to it is that already discussed. Whether these allegations constituted a good defense to the cause of action set up in the complaint was a question not presented by the demurrer, consequently was not passed upon by the trial court, and is not before us.

The remaining questions before us relate to the action of the court in sustaining the plaintiff's demurrer to the defendant's remonstrance to the report of the state referee.

The defendant remonstrated against the report upon the ground that: " The Referee has found the following facts without evidence, against evidence and upon improper evidence," followed by a recital of the facts found in twenty-two of the thirty paragraphs of the referee's report, constituting practically all of the material facts found by the referee. Such a wholesale attack upon the finding of a state referee violates good practice and awakens distrust as to the good faith of the claim made. Gallaher v. Southern New England Telephone Co., 99 Conn. 282 290, 121 A. 686. It is of course beyond the realm of probability that substantially all of the facts found by the referee were found without evidence. The language of the remonstrance makes it clear that such was not the real claim of the remonstrant. The allegation that the facts were found against evidence and upon improper evidence " fairly implies that there was evidence bearing upon the fact found, and that in the view of the remonstrant it supported his side of the question and did not support the other, and that the finding should have been the other way. It is another way...