Street v. Farmers Elevator Co. of Elkton
| Decision Date | 24 November 1914 |
| Docket Number | 3394. |
| Citation | 149 N.W. 429,34 S.D. 523 |
| Parties | STREET v. FARMERS' ELEVATOR CO. OF ELKTON. |
| Court | South Dakota Supreme Court |
On rehearing. Former opinion affirmed.
For former opinion, see 33 S.D. 601, 146 N.W. 1077.
Cheever & Cheever, of Brookings, E. A. Berke, of Elkton, and H Hanson, of Brookings, for appellant.
Hall Alexander & Purdy, of Brookings, for respondent.
This cause is before us upon rehearing. Our former opinion is to be found in Street v. Elevator Co., 33 S.D. 601, 146 N.W. 1077. The order granting the rehearing limits the further consideration of this appeal to the single question of the constitutionality of the Warehouse Act, when given the construction given to it by the majority of this court in our former opinion.
The particular section of this act which appellant contends is unconstitutional, as construed by us, is section 495, P. C. which reads as follows:
As we read its brief, the sole basis for its contention is the claim that such section makes the storage receipt conclusive evidence of ownership of the grain, and therefore is an attempt, on the part of the Legislature to deprive parties of a judicial determination of their rights.
We think appellant's error lies in not looking back of the language used and determining the real effect of such section. It is true that, upon its face, it purports to prescribe a rule of evidence; but we think a careful consideration discloses that it proclaims a rule of substantive law and not a rule of evidence. As is said by Wigmore, at section 1353 of his work on Evidence:
"On the one hand, so far as a so-called rule of conclusive evidence is not a rule of evidence at all, but a rule of substantive law, it is clear that the Legislature is not infringing upon the prerogative of the judiciary."
This same thought is announced by Chamberlayne in his Modern Law of Evidence, wherein he says:
Let us suppose a statute were enacted which provided that a bailee could never dispute the bailor's title to the thing bailed; that such a statute prescribed a rule of substantive law could and would not be questioned. Suppose a statute were enacted which provided that proof of the existence of the relation of bailor and bailee should be conclusive evidence, as against the bailee, that the bailor was the owner of the thing bailed; would not such a statute be, in its legal effect, exactly the same as the first supposed statute, and merely provide the same rule of substantive law-that a bailee could never dispute the bailor's title? Going one step further, so as to bring the supposed statute on all fours with the statute at bar, let us suppose a statute which provided that, in every case of bailment, the bailee should give to the bailor a written receipt for the goods bailed, and should further provide that this receipt should be conclusive evidence as against the bailee, of the bailor's title; would we not have in such a statute but a declaration of two rules of substantive law: (1) That a written receipt must be given; (2) that the bailee could not dispute the bailor's title? Is not the receipt but proof of the relation, and the relation the thing that conclusively precludes the questioning of the bailor's title? Let us take the first half of said section 495, down to the word "thereof"; would any one contend that this was other than a declaration of a rule of substantive law-a declaration of estoppel? Take the latter half of such section, and in place of the words "such receipt" substitute "proof of the relation of bailor and bailee," and in place of "same" substitute "receipt"; does not the substitution of these words render it perfectly apparent that the second half of the section as enacted is but a second declaration of the same rule of substantive law announced in the first half-that a public warehouseman is estopped from denying the title of his bailor to the thing bailed? To illustrate the distinction between a purported rule of evidence, which is but a declaration of a rule of substantive law, and a rule that is purely what it purports to be, we need but compare said section 495 to a supposed law which should provide that the receipt given by the warehouseman should be by him acknowledged and that a warehouseman's receipt duly acknowledged should be conclusive evidence of the execution of such receipt. In the one case, we have what amounts to a rule of substantive law, resting upon and flowing from the relation of the parties; in the other case, we have a pure and simple rule of evidence.
Wigmore, in treating of the subject of the constitutionality of statutes making testimony conclusive, in section 1353 of his great work, following the words we quoted above, distinguishes between those statutes that in fact do lay down a rule of conclusive evidence and those which announce a rule of substantive law, and he then, in the same section, notes that those statutes, which announce a rule of substantive law, may, for reasons entirely foreign to any question of evidence, be unconstitutional-as where a law, retroactive in its effect, would impair an obligation of contract, or where a law, purporting to make a tax deed conclusive evidence that all due proceedings had been had, would have the effect of taking property without due process, by declaring as unnecessary what the Constitution declares necessary. Then in section 1354 he distinguishes between statutes, such as those attempting to make tax deeds "conclusive evidence" of the validity of the tax proceedings, thus attempting to abolish the necessity of the existence of essential facts which are constitutionally required for a "taking by due process of law," and statutes which announce a rule of substantive law based upon the contractual relations of the parties, such as laws making "the terms of a bill of lading or of a policy of insurance *** 'conclusive' in certain respects"; and this learned writer announces the test which, when applied, will demonstrate the constitutionality of the latter class of laws. He says that "a statute which enlarges the rules of contract by creating an estoppel is constitutional. " It is because there is no contractual relation upon which estoppel can be based that statutes attempting to make tax deeds "conclusive evidence" of the validity of tax proceedings are unconstitutional. The statute before us is one which "enlarges the rules of contract by creating an estoppel," and is constitutional. This court has recognized the constitutionality of this class of legislation. In Peever Mer. Co. v. State Mut. Ins. Co., 25 S.D. 406, 127 N.W. 559, the question of the constitutionality of section 1849, C. C., was raised. This section reads:
"An acknowledgment in a policy of the receipt of premium is conclusive evidence of its payment, so far as to make the policy binding, notwithstanding any stipulation therein that it shall not be binding until the premium is actually paid."
Justice Smith, speaking for the court, said:
"We are not able to find any constitutional provision limiting the power of the legislative assembly in the enactment of such legislation."
A similar statute was before this court in Lawver v. Globe Ins. Co., 25 S.D. 549, 127 N.W. 615, and its provisions enforced. In upholding an insurance statute analogous to the statute before us, and in marking the distinction between what is and what is not constitutional, in a case wherein it was urged "that the statute takes away a fundamental right and precludes a judicial inquiry *** by a conclusive presumption of fact," the same contention as is made in this case, the federal Supreme Court, in Orient Ins. Co. v. Daggs, 172 U.S. 557, 19 S.Ct. 281, 43 L.Ed. 552, said:
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