Wirtz v. Ti Ti Peat Humus Company, Civ. A. No. 7953.

• Decision Date: 14 January 1966
• Docket Number: Civ. A. No. 7953.
• Citation: 249 F. Supp. 166
• Court: U.S. District Court — District of South Carolina
• Parties: W. Willard WIRTZ, Secretary of Labor, United States Department of Labor, Plaintiff, v. TI TI PEAT HUMUS COMPANY, Inc., a Corporation, Defendant.

249 F. Supp. 166

W. Willard WIRTZ, Secretary of Labor, United States Department of Labor, Plaintiff, v. TI TI PEAT HUMUS COMPANY, Inc., a Corporation, Defendant.

Civ. A. No. 7953.

United States District Court D. South Carolina, Charleston Division.

January 14, 1966.

Charles Donahue, Sol., Beverley R. Worrell, Regional Atty., Roger J. Martinson, Atty., U. S. Dept. of Labor, for plaintiff.

Charles H. Gibbs, Sinkler, Gibbs & Simons, Charleston, S. C., for defendant.

SIMONS, District Judge.

Plaintiff instituted this action to enjoin defendant from violating the provisions of Section 15(a) (1) and 15(a) (2) of the Fair Labor Standards Act of 1938, as amended, 29 U.S.C.A. § 201 et seq., hereinafter referred to as the Act. The court has jurisdiction pursuant to Section 17 of the Act.

In his complaint plaintiff alleges that defendant has heretofore employed and is now employing approximately six employees in and about its place of business at a locality known as Green Pond in Colleton County, South Carolina, in mining, pulverizing, processing, and otherwise working on, and bagging peat humus; and in selling and distributing the same to points outside the State of South Carolina; and that said employees are engaged in commerce and in the production of goods for commerce within the meaning of the Act. Plaintiff further alleges that during the period since June 26, 1960 defendant has violated, and is violating, Sections 7 and 15(a) (2), the overtime provisions of the Act; and that during the period since June 26, 1960, defendant has violated Sections 6 and 15(a) (2), the minimum wage provisions of the Act. Plaintiff seeks to enjoin such alleged violations under Section 17 of the Act. In its answer defendant admits generally the allegations of the complaint, but denies that plaintiff should be granted an injunction. Defendant also sets up the affirmative defense that its said employees are exempted from the foregoing sections of the Act, under either or both of the exemptions afforded by the agricultural exemption Section 13(a) (6); or the area of production exemption Section 13(a) (10). Defendant also asserted the affirmative defense based upon the forestry exemption provided by Section 13(a) (15) of the Act, which was voluntarily abandoned at the trial.

At the commencement of the trial, defendant by stipulation conceded that it had not paid its employees in accordance with the minimum wage and overtime provisions of the Act, and rested its defense upon its affirmative defenses that it was exempted from the Act's coverage. Thus the sole issues to be determined by the court are: (1) Whether defendant's employees are exempted from the coverage of the Act; and (2) if not, should injunction be granted restraining defendant from further violation of the Act.

The case was tried before me without a jury on July 12, 1965 at Charleston, South Carolina. In compliance with Rule 52(a) Federal Rules of Civil Procedure, I find the facts specially and state my conclusions of law thereon.

FINDINGS OF FACT

1) Defendant is a South Carolina Corporation, organized during 1955 with its principal and only place of business near Green Pond, Colleton County, South Carolina, within the jurisdiction of this court. For some time prior to September 3, 1961, and during the period since that date employees of the defendant have been and are now engaged in commerce, or the production of goods for commerce, within the Act. Since September 3, 1961, its employees have been paid by defendant at hourly rates less than the minimum wages required by the Act; and were compensated for their overtime hours the hours by which their employment exceeded 40 hours per workweek at the rate of one and one-half times such subminimum rates, in violation of the overtime provisions of the Act. The defendant regularly ships goods produced by its employees to points outside the State of South Carolina.

2) About the year 1945 C. T. Cummings, who is now President of defendant, acquired approximately 3,500 acres known as Creighton Hill Plantation in Colleton County. Sometime later it was determined that a portion of this acreage contained valuable peat or peat humus in sufficient quantities that such could be commercially harvested and sold. Mr. Cummings, after the formation of defendant corporation, leased 2,000 acres of his tract to it, and the lease has recently been extended for an additional ten-year period.

3) During the past ten years the peat has been gathered and harvested from a portion of the tract by the use of spring tooth harrows, rotor tillers, frontend loaders, and farm tractors. Prior to gathering of the peat, the tract was generally covered with trees, brush, and various species of weeds and grasses. Most of the area was damp, low lying land covered with surface waters. Prior to the harvesting operation, it was necessary to drain the area and clear the lands of all growth and vegetation. Defendant constructed roadways, a railroad siding, drainage ditches, and a processing and packaging plant.

4) During the past several years defendant's operations have been hampered by excessive rainfall, which has caused several interruptions and difficulties. It has not proved to be a profitable venture, as none of its ten stockholders has received any dividends in the history of the company, and no officer of the company has been paid a salary. Mr. Cummings, as lessor, has not received rent or compensation for the lease of his peat bearing lands as provided for in his lease with defendant.

5) No seasonal crops are planted or cultivated on any portion of the 2000 acres leased by defendant from Mr. Cummings, and it produces or deals in no other commodity or product other than peat. Neither has it during the period of the operation planted or cultivated any growing plants such as mosses, reeds and sedges from which the peat deposits were formed and accumulated.

6) The plant site is in a remote area of Colleton County, twenty-five to thirty miles from Walterboro, the closest incorporated town, whose population is 5,417 by the 1960 census. This meets the Area of Production requirements in the exemption provision Section 13(a) (10) of the Act for agricultural and horticultural commodities as defined by the Secretary. 29 C.F.R. 532.2.

7) In fiscal year 1964 net sales by defendant amounted to just under $79,730.40. Labor costs for a plant or bog manager and for field and plant employees amounted to $29,247.67 for this period. Through the testimony of Mr. Cummings, its President, defendant has assured the court that, in the event its employees are found not to be exempt from the Act it will either comply fully with the provisions of the Act in its future operations, or it will go out of business completely. It asserted its financial inability to make any back payments found due to its employees.

8) The peat or peat humus is gathered by defendant from an area described as a wet meadow or a bog, which is in general waterlogged, wet and full of moisture, and must be drained and cleared of underbrush and all growing vegetation before any harvesting of peat is commenced. After the bog has been adequately drained and cleared, the peat is then ready for harvesting or gathering. This is accomplished by plowing the bog or field with spring tooth harrows and rotor tillers to loosen and till the peat so that it can be air-dried and loaded by a frontend loader onto tractor-drawn dump carts; then it is carried to the plant to be screened for roots, and then bagged or loaded into trucks for bulk shipment. Other than screening out the roots, no further processing or treatment is required, nor is it necessary to add any substance to the peat.

9) Defendant's deposit of peat covering approximately 40 acres is composed of decaying and decayed plants such as reeds, sedges, red root, baze, southern smilax, pine, pine straw, bay and laurel trees, and many other botanical specimens including various types of mosses, some of which have apparently been recently growing, and others which have been decayed, accumulated, and preserved in the waterlogged area over a period of several hundred years. Reeds, mosses, and sedges are the principal and dominant reproducing vegetation in the Ti Ti bog, and their roots contribute to the total organic matter. This material is accumulated in waterlogged areas down to a depth of 16 feet in some places, and is subject to very slow decomposition under water. As a general rule there will be living matter growing on top of the bog, and immediately below that the decayed matter which has been alive a short time previously. The peat is laid down annually, the bottom level being the older strata and the top strata being only a few years old. The peat has living organisms in it such as bacteria and fungi.

10) The chemical properties of the peat in question do not vary according to the depth at which the peat may be found, since defendant's is a uniform bog; and analyses made over a period of ten years show the same to be about 97% vegetable organic matter, and about 3% mineral ash, the latter being principally a siliceous substance commonly known as inert sand.

11) The chief uses of peat in agricultural and horticultural pursuits is in soil conditioning, since it gives lightness to a heavy soil, and waterholding capacities to light, sandy soil. The use of peat also stimulates plant growth and the rooting of plants, the development and growth of leaves and leaf color; and is used extensively as potting material for plants in greenhouses, and as protection for plants and flowers in shipment.

12) Defendant's peat deposit was undoubtedly formed entirely from vegetation and its progressive decomposition through the years, in a saturated natural environment such as a bog, stagnant pond, marsh, or the like. It is in such surroundings that the mosses, reeds and sedges propagate and grow in masses and form peat humus. The accumulation is marked by two...