State v. Cudahy Packing Co.

• Decision Date: 17 November 1905
• Citation: 82 P. 833,33 Mont. 179
• Parties: STATE v. CUDAHY PACKING CO. et al.
• Court: Montana Supreme Court

82 P. 833

33 Mont. 179

STATE v. CUDAHY PACKING CO. et al.

Supreme Court of Montana

November 17, 1905

Appeal from District Court, Lewis and Clarke County; Henry C. Smith Judge.

Information by the state against the Cudahy Packing Company and others. From a judgment for defendants, the state appeals. Affirmed.

Albert J. Galen, Atty. Gen., and E. M. Hall, Asst. Atty. Gen., for the State.

M. S Gunn, for respondents.

BRANTLY C.J.

The respondents were charged by information, filed by the Attorney General in the district court of Lewis and Clarke county, with the crime of conspiracy, under section 321 of the Penal Code. The charge in substance is that the respondents did on or about December 1, 1904, unlawfully agree and combine together to fix and control the price of certain articles of commerce consumed by the people of the state of Montana, and to destroy competition by restricting trade therein, to wit, meats of all kinds and meat products and did then and there fix the price and offer for sale, and sell, said articles to the people of said county contrary to the force and effect of the statute, etc. The respondents demurred to the information on the ground that the facts stated do not constitute a public offense. After argument the court allowed the demurrer, and gave judgment accordingly. Thereupon the state appealed.

The question submitted for decision is whether the legislation contained in chapter 8, tit. 7, pt. 1, Pen. Code, of which said section 321 is a part, is obnoxious to that portion of the fourteenth amendment to the Constitution of the United States which declares that "no state shall *** deny to any person within its jurisdiction the equal protection of the laws." The legislation referred to deals with the subject of criminal conspiracy, denouncing the acts constituting the crime and providing for its punishment. The portions thereof involved here are sections 321 and 325, as follows:

"Sec. 321. Every person, corporation, stock company, or association of persons in this state who, directly or indirectly, combine or form what is known as a trust, or make any contract with any person or persons, corporations or stock companies, foreign or domestic, through their stockholders, directors, officers, or in any manner whatever, for the purpose of fixing the price or regulating the production of any article of commerce, or of the product of the soil for consumption by the people, or to create or carry out any restriction in trade, to limit productions, or increase or reduce the price of merchandise or commodities, or to fix a prevent competition in merchandise or commodities, or to fix a standard or figure whereby the price of any article of merchandise, commerce or produce, intended for sale, use or consumption, will be in any way controlled, or to create a monopoly in the manufacture, sale or transportation of any such article, or to enter into an obligation by which they shall bind others or themselves not to manufacture, sell, or transport any such article below a common standard or figure, or by which they agree to keep such article or transportation at a fixed or graduated figure, or by which they settle the price of such article, so as to preclude unrestricted competition, is punishable by imprisonment in the state prison not exceeding ten thousand dollars, or both. Every corporation violating the provisions of this section, forfeits to the state all its property and franchises, and in case of a foreign corporation it is prohibited from carrying on business in the state."

"Sec. 325. The provisions of this chapter do not apply to any arrangement, agreement or combination between laborers made with the object of lessening the number of hours of labor or increasing wages, nor to persons engaged in horticulture or agriculture, with a view of enhancing the price of their products."

These provisions are the result of an effort on the part of the Legislature to carry out the mandate of the Constitution of this state, which declares: "No incorporation, stock company, person or association of persons in the state of Montana, shall directly, or indirectly, combine or form what is known as a trust, or make any contract with any person, or persons, corporations, or stock company, foreign or domestic, through their stockholders, trustees, or in any manner whatever, for the purpose of fixing the price, or regulating the production of any article of commerce, or of the product of the soil, for consumption by the people. The legislative assembly shall pass laws for the enforcement thereof by adequate penalties to the extent, if necessary for that purpose, of the forfeiture of their property and franchises, and in case of foreign in corporations prohibiting them from carrying on business in the state."

The contention made by respondents in the district court and here is that the exception contained in section 325, by which the provisions of section 321 are declared not to apply to persons engaged in horticulture and agriculture, renders the provision of section 321 unconstitutional. The language of the last clause of this section is vague and indefinite; but, reading the whole section together, this clause should be construed to read as follows: "Nor to any arrangement, agreement or combination made by persons engaged in horticulture or agriculture, with a view of enhancing the price of their products." The obvious purpose of the Legislature was to except from the operation of section 321 devices which might be resorted to by horticulturists and agriculturists to enhance the value of their products and destroy competition in trade therein when they came to put them upon the market. The Attorney General does not seriously controvert the proposition that the legislation as it stands is open to the constitutional objection urged against it, but he insists that since the provisions of the Constitution of the state are mandatory, and since the Legislature has declared in section 321 generally against every species and character of combination denounced therein, section 325 can be held inoperative, leaving section 321 to stand in full force. In this connection he suggests, also, that neither the provisions of section 321 nor those of the Constitution by any intendment can include labor organizations; and that, so far as section 325 refers to this character of combinations, it is simply nugatory, and a disregard of it will not extend or affect the provisions of section 321.

It is clear that, if this section of the state Constitution does not apply to combinations of laborers for the purposes stated, no exception was necessary, to exempt them, for section 321, supra, is no more specific in its terms than is the section of the Constitution; and, if the phrases "articles of commerce" and "products of the soil" in the former do not apply to or include them, neither do they, nor the terms "trade," "merchandise," and "commodities," as used in the latter, include them. But an inquiry into the question thus suggested is not now pertinent. Nor is it necessary to inquire into the question, also suggested, whether this exception does in itself render the legislation obnoxious to the provisions of the federal Constitution invoked by respondents. Nor, again, is it necessary to inquire whether the legislation is, by reason of any exception stated in it, obnoxious to any provision of our state Constitution.

The Constitution of the United States, is, within the scope of its provisions, the supreme law of the land, and state courts and Legislatures are bound by it as well as by the interpretation put upon its provisions by the federal court of last resort. In the cases of Connolly and Dee v. Union Sewer Pipe Co., 184 U.S. 540, 22 S.Ct. 431, 46 L.Ed 679, the court had before it the identical question presented in this case. In these cases the Supreme Court of the United States considered the validity of the trust statute of Illinois of 1893. That act in terms prohibited combinations of capital, skill, or acts by two or more persons, firms, corporations, or associations of persons, or any of them, for any or all of the following purposes: To restrict trade; to limit production, or to fix the price of merchandise or of commodities; to prevent competition in manufacture, transportation, sale, or purchase of any product of industry; to fix or control prices, or to establish any agency for that purpose; or to make or enter into any contract or agreement by which the parties should bind themselves not to sell, dispose of, or transport any article of trade below a common standard figure or card or list price, or any contract or agreement to keep the price of any such articles or its transportation at such fixed price, in order to prevent free and unrestricted competition. Severe penalties were provided for the violation of any of its provisions. The ninth section of the act (Starr & C. Ann. St. c. 38, par. 117) provided: "The provisions of this act shall not apply to agricultural products or live stock while in the hands of the producer or raiser." The tenth section declared that any purchaser of any article or commodity from any person, firm or corporation, or association of a persons doing business in the state contrary to any of the provisions of the act should not be liable for the price of such article, and might plead the act as a defense to any suit for the price. The Union Sewer Pipe Company brought its actions in the Circuit Court of the United States for the Northern District of Illinois against the plaintiffs in error to recover the price of certain sewer pipe sold by it to them. After alleging that the corporation was a combination in the form of a trust, and was engaged in conducting its business in Illinois in violation of ...