Borden Company v. Thomason

COMPANY, Plaintiff- The BORDEN Respondent, Agri THOMASON, Commissioner

Don Attorney Eagleton, culture, F. and Thomas Defendants-Appel Missouri, General lants, Blakeney, Blakeney E. and Thomas

Hal C. Dairy Dairy, Blakeney Com Reiss d/b/a Dairy Com pany, Inc., Woodlawn Farm Beverly Dairy Company, pany, Inc., Ozark Dairy Company, Com Dairy Tucker Farm Company, Dairy Palace Bak pany, Hiland Company, ery Intervenors- Cream Ice Appellants.

No. 48736. Missouri,

Supreme Court of

En Banc.

Jan. 1962.

Rehearing Denied 1962. Feb.

737 many years engaged

has for processing selling wholesale (at market retail) products, including of milk milk, milk, milk, pasteurized D vitamin milk, flavored homogenized flavored milk or Sachs, Kelly, Joseph Jr., Howard F. J. cream, drinks, milk, whipping sweet Kyle Williams, City, Kansas D. Jefferson homogenized cream, milk, butter- skimmed City, Greaves, Ill., for Joseph Chicago, A. milk, cottage cultured buttermilk Fane, Britt plaintiff-respondent. Spencer, addition, processes sells cheese. Mo., & City, Kansas of counsel. Browne, (at retail) cream, wholesale and frozen ice desserts, non-dairy products. and numerous Atty. Gen., Wayne Eagleton, Thomas F. A thus substantial amount such Gen., Waldo, Atty. Asst. for defendants- W. processed proc- and distributed it are appellants. pro- essed or made from and cream Riddle, O’Herin, Veryl Baker & L. Rid- Approximately duced on Missouri farms. dle, O’Herin, Baker, H. Edward plaintiff’s Charles F. of and business is wholesale 85% Malden, Gray Chesterfield, Dorsey, Missouri, in- buys for retail. milk It from 15% tervenors-appellants. Kansas and Iowa whole- farmers. It fixes prices prices routes,

sale on delivery retail for home delivery, prices and dock to dis- DALTON, Judge. products. who Re- tributors come for their This is an action declaratory judg- spondent’s for a purchases milk be- annually total injunctive ment and purpose The of relief. tween two and million one-half and three the action to have is House Bill No. dollars. by Assembly

enacted the 70th General and thirty- The Act in here contains styled “An Act relating to sales of and milk one sections and It certain subsections. is products,” unconstitutional, milk declared a comprehensive Act sale of relating to the void and ineffective entirety in its and products. purposes milk milk and For our have the enjoined defendants from en- at time unnecessary this out will be to set forcing attempting pro- or enforce the full, in we briefly Act shall refer visions of said Act. Certain interested provisions. to certain of parties permitted were to intervene. designated Act is now Secs. as 416.410 1 of (now Sec. the Act 416.410) defines § 416.560, inclusive, re- RSMo and is certain terms used in the Act. n ferred to “Unfair Milk Sales Prac- (now 416.415) tices (All statutory Act.” deals are to Sec. with sales § references by processors any or distributors RSMo and of milk V.A.M.S. unless otherwise in- product for ) dicated. The trial less than cost and found makes ad- court the issues per- plaintiff vertising, by offer for the to sell or sale granted and such the relief prayed. sons for than less cost under cir- Defendants and certain intervenors prima appealed. cumstances evidence a viola- facie tion of said section. respondent The evidence shows that ais corporation organized . existing (now 416.420) under Sec. 3 deals § with dis- of the New Jersey price by processors laws State of in crimination or dis- duly authorized to products transact in business tributors of such in different sec- actively It engaged provides State Missouri. is tions of the state and proof many parts of the United States in in a differential parts various manufacturing, state, processing, business of sell- under certain circumstances ex- ing dairy products many dealing cept stated, prima therein evi- facie kinds. In the State of Missouri it is and dence of violation of this section. license with non- fees. Commissioner of (now 416.425)

Sec. 4 deals § Agriculture designated the sale as a prohibits commissioner processing retailers and authority promulgation under product given milk retailers for any by such carry regulations cost to of rules and out the than certain for less circumstances purposes offer Provision is further the Act. the retailer and makes the sale prima triple recovery damages made for the retailer such such sale of injured by section. those It violations of Act. evidence of a violation facie provided provided further the remedies bulk with (now 416.430) deals Sec. § and that are exclusive no- the sale prohibits milk handlers imposed penalties criminal fines shall circum- dairy-milk products certain under provisions. for violation of its pro- less than to them stances for cost petition challenged In its plaintiff by the milk vides the sale of bulk such particulars in thirteen trial prima at less than handler cost shall facie plaintiff’s objections court sustained nine section. of a violation of this evidence separate grounds con- summarized three (now prohibits clusions 416.435) of law. Plaintiff Sec. concedes com- person many any alleged circumstances of the in the Act are certain defects com- product essentially legal questions most bining than the price less modity or service at evidence directed to one offered was product invalidity grounds aggregate assigned cost of offered commodity service one section This and the other of the Act. evidence sale, prima and such a sale will be con- for makes reviewed in connection with the facie plaintiff’s a this section. sideration of 2 of evidence of violation attack on Sec. of Act milk prohibits the of sale prohibits milk 416.440) (now Sec. below cost. offering processors from and distributors pur- Appellants their certain circumstances first contend that etc., rebates, discounts, plaintiff and makes judgment chasers court erred for giving evidence proof prima petition plaintiff’s of such conduct for the reason fails facie and likewise a of this section a claim can be violation to state which relief of ac- milk-product purchaser from presented a and prohibits granted that the evidence etc., discounts, rebate, and cepting support judgment such insufficient to ren anything proof acceptance of Appellants of insist that makes dered court. purchaser milk-product plaintiff such the evidence vio of value indicates of this provision Act, prima lating any evidence of a violation of facie plaintiff show like to make com does would section. sales, allowance, advertising grant bination referred to circumstances The mentioned services, certain make furnish free certain intent are “with the sections in the several donations, merchandise, away certain give unfairly diverting the effect of or with equipment give give or loan certain and competitor, in- a of otherwise trade circumstances, aid under certain financial com- competitor, destroying or of juring a carrying on its business it desires all in monopoly.” petition, creating of prior and had been to the effec doing as it imposes date of Act would do duty attorney on the tive and now if prohibited by Appel Act. attorney to it were not prosecuting examine general or argue point persons claiming plaintiff one in- lants cannot complaints right single Provision been curtailed or in by violations has Act. jured fringed, the issuance writs of in- that “there is con for insists made troversy presently existing violations. Provi- against such between junction plaintiff for find no made the issuance of licenses the defendants.” We is also sion subject fixing Act and for the in these merit contentions. those petition alleged “The competition Plaintiff’s that: whether such a limitation indirectly provisions directly of the Act government light of the State function laws; proper interfere with the and economical Federal anti-trust (3) wheth- plaintiff’s business, preserva- er this discriminatory conduct law constitutes class expansion markets, prop- legislation; (4) tion its whether it contains products to the handling delegation legislative er unlawful power. sale prop- Respondent consumer, deprive plaintiff says grave of its also there law, erty process questions without due in violation concerning propriety Missouri, of the State of means Constitution chosen Assembly General ^[*] and the n » jic Constitution of United States limit As to whether there is a competition milk proper industry. govern- competition mental interest in limiting Judgment Declaratory Under industry by specific appli- statute “justiciable Act, 527.010-527.140, a Secs. it, cable the defendants’ evidence tends exists where an actual con controversy” that, pursuant to show to Senate Concurrent persons in troversy exists between whose Resolution No. 19 of the 69th As- General Plaintiff must adverse in fact. terests are sembly, an appointed interim committee was protectible legally interest at stake have a study problem production, process- appro presented must be and the ing, sale and distribution in this priate ready ex State rel. decision. State. The chairman this committee Thatch, 359 Mo. Chilcutt v. was Senator Spradling, Jr., Albert M. pleadings and evi 176. We think the Cape Girardeau. The committee made its clearly dence show cause bringing facts report January 70th General express provision of the Declara within the Assembly and submitted it a detailed re- tory Judgment suffi Act. The record is port Report entitled “Final of the Joint controversy ripe deci cient to show on Milk Committee Producers and Dis- plaintiff ac sion. The fact that has not proposed adopted by A tributors.” bill tually provisions violated the of Bill House the committee to be introduced for the con- question No. 255 in here does not make the Assembly. sideration of the General premature. must action We and hold do validity plaintiff properly can have the that report points This out that: “There is declaratory in the Act determined this article in general no of food more use than judgment in de proceeding action before milk; impurity none whose and unwhole- proper fiance Plaintiff of it. invoked a quickly, more widely, someness more County, remedy. City Joplin Jasper v. seriously and more the affect health 411, 412; City 349 161 S.W.2d Mo. regulation who it. those use The of its sale Welty, Mo. 203 Nevada 356 S.W.2d imperative duty anis that has been univer- * * * 459, 460; Tietjens City Louis, St. sally recognized. Between 1933 71. Mo. twenty-seven adopted and states milk price committee, legislation.” control Appellants trial next contend that the however, regulation submitted a milk sales in the declaring court erred Act in patterned after bill Tennessee Act. entirety. unconstitutional and void “Dairy Tennessee,” Law the State of ruling this issue we convenience shall Chapter 3, 52.331 to 52.341. Secs. The com- respondent’s contentions consider several finding to the existing mittee’s as situation unconstitutionality reference as in Missouri was follows: specific of the Act and as a whole. sections says Respondent by issues in case “Testimony received the committee re- following: (1) whether there is include the vealed seriousness of situation which limiting only interest proper governmental gro- evident in the corner has too industry; (2) supermarkets competition cery milk stores and our state class, appropriate operated A de- an but in a past series of dis- during the months. criminatory frightened pricing and de- in that and price fashion structive wars has fully legislation was marketing citizens who limited to the those of our moralized industry; activi- milk implications such the Act constituted understand “special depend legislation, for their in violation of as who enacted as well those ties industry. right equality has Milk of treatment and free- the milk livelihood per discrimination, half arbitrary dom from and in eight little as cents as sold town, special leg- principle In one violation of the gallon in some areas. price dairy products islation law milk shall be enacted when and other provided able applicable, by were can be Arti- dropped low that farmers made so I, III, pigs. purchase their cle and Article Section them feed to Section greeted consumers, “Of course, prices with enthusiasm the natural such inflation-weary these consequences are often Section ^[30] United States 1 of the Missouri Constitution Fourteenth Amendment to Constitution.” and by pro- thereof bode future difficulties for support the trial seeks to ducers, alike. and consumers distributors argument judgment by to the effect court’s pressure on Price exert tremendous wars legislation under consideration re- smaller who are without the distributors applicability to all fails have uniform periods ,of operate for extended sources to class; appropriate members of on each sale. is incurred time when loss discriminatory operates arbitrary purchased price of much of the milk to for- fashion; no reason and that there is producers is established in Missouri products, or to milk below cost of bid sales Thus the distributor federal order. competitive prices milk prohibit other trapped the contract- between finds himself applicable equally industry, are not price of the milk pincers of the stable ing gaso- packers, or sellers baker and meat buys and the ever lower he Respondent insists that cigarettes. line small conditions dis- Under such he sells. products peculiarities of sold disappear large distributors tributors processors natural- do not sellers longer competition no controls expand until separation from the ly suggest a mercy buyer prices is left to producers commodities sold prices paid producers the seller. Where Respondent argues gen- that a dealers. fixed, producer may are not losses pricing market- governing eral law This, farmer. partially shifted to- applica be made of all commodities can ing factors, dairy- other induces the gether with City, McKaig v. Kansas Plaintiff cites ble. production could and to abandon milk man 815; Hagerman 1033, 256 S.W.2d Mo. 363 supply years to lead to a serious short 403, Louis, Mo. 283 S.W. City 365 of St. v. come.” 41, 226 125 623; Woolley Mears, v. Mo. 2d Respondent 1112, cases. applies and other to which this evidence The issue S.W. presented by respondent’s contention also cites Sec. 40 ^[30] Article III the V.A.M.S., 1945, and special and discrimina- Constitution the Act is “invalid Missouri protection of the equal section prohibits the legislation, in sales be- tory that it refers 2 and to and pro- Amendment Secs. but fails Fourteenth low ‘cost’ of pro- Missouri Constitution I of the products, 10, Article such sales of similar hibit right of the concedes by milk 1945. hibits certain discrimination production control sellers, regulate and prohibits and not other but State sellers regard to of milk with san practices in the distribution pricing and business and certain purity not as to sales and and dairy products but not in itation distribution Respond practices. and sales products.” The trial distribution distribution similar Assembly can that the General applicable insists not ent found that was court -persons, split a natural class take members of not uniformly equitably

743 desig- two, people largely arbitrarily depends. and then It has often class in original particularly nate been the subject regulatory' the dissevered fractions of classes, legislation. Liessing, enact thereupon City unit In Louis as two v. St. ** * 464, 611) each. (190 different for 89 government rules Mo. S.W. Woolley Mears, supra. upholding validity an ordinance v. St. con prohibiting Louis the sale of milk supra, case, In Court McKaig taining less than a certain amount of prohibiting automo- held that an ordinance fats, 481, said, the court 190 Mo. loc. cit. special Sunday bile invalid as sales 613, ‘Perhaps 89 one S.W. loc. on no cit. legislation auto- it limited to because was subject police power has this been affirmed dealers, Sunday permitting mobile while as often right inspect regulate as the all merchan- sales of “all commodities Appellant’s sale of milk and cream.’ except dise automobiles.” question contention that the law in violates against special constitutional inhibition validity of the In considering laws cannot be sustained.” keep mind Act in here we must that, Legislature “An act of the carries McDowell, the case Borden Co. v. constitutionality. presumption The court 246, 146, 155, Wis.2d 99 N.W.2d court un unconstitutional will declare act pointed dairy out “that the sub industry is plainly less it the Constitution.” contravenes ject regulation regulated been has Smith, Lemay Fire v. State ex rel. Dist. of so legislature public for the welfare 593, 807, 184 S.W.2d 594. “While Mo. many years.” In the case of State guard con duty of the is the courts Co., Kansas ex Fleming rel. Anderson v. rights against citizen of the stitutional 674, 12, Kan. 339 P.2d the court said the arbitrary power, equally true merely it is dairy industry regulated had been rec legislative enactments should be purpose public protecting health and court, as em enforced ognized and welfare completely more in than they people bodying will of the unless dustry. palpably a violation plainly In the case of H. P. Hood & v. Sons law of the Constitution.” fundamental DuMond, 657, 660, 336 U.S. 69 S.Ct. Brockman, 58, 12 321 Mo. S.W.2d Blind v. 93 L.Ed. the court said: “Production County, 742, 747[5]; Barker St. Louis v. intimately distribution of milk are so 371, 377; Bowman 340 Mo. public related to health and welfare City, 361 Kansas Mo. S.W.2d regulation protect the need for those Hankinson, Joseph ; City of St. 33[12] long is, interests has recognized Mo.Sup., S.W.2d 10[9-12]. standpoint, hardly constitutional Bresh Creber Market Co. v. In Poole & Also, economy controversial. ears, 1133, 125 32[16- 343 Mo. S.W.2d industry is so eccentric that economic con- 17], the said: Court necessary trols have been found at once police power difficult.” The extends eco- to may legislature “That the make reason- Geror, nomic And needs. see McElhone v. classification the among able various sub- 292 580, 207 Minn. N.W. 414. conceded, legislation be jects of must and presumptions the are all in since favor of ‘ validity its “It the acts must made be find no in respondent’s We merit appear beyond a reasonable doubt that to contention that the Act in relating ” 'there are no distinctive circumstances’ the sale of milk and milk spe justifying discriminatory the classification.’ legislation Thomas v. cial in violation County, 627, I, 10, 330 Mo. 51 2 III, Buchanan S.W.2d Article or or Secs. Article * ** 95, 98. Milk is almost universal- Missouri Sec. Constitution 40[30] upon 1945, used food it 1 ly as a and the health or Sec. of the Fourteenth Amend- 744 Kell public City Louis v. good. of St.

ment to the of the Constitution United mann, 71, Clearly 82, 295 Mo. S.W. 134. greater govern- 243 States. there is a insuring promoting mental in and interest Liquidators, In the of ABC Inc. v. case competition industry by fair in the milk 876, City, Mo.Sup., Kansas 322 S.W.2d industry prohibiting in that sales below cost [4], apparent 881 “It is the Court said: industries, than in accounts which fact an question purports in be ordinance legislative remedy attempt un- power police power, exercise which competition fair danger and avoid city upon Kansas has been conferred monopoly facts industry. in On 1949, City statute. 82.300 RSMo Section Legisla- found interim committee the V.A.M.S.; 354 City, Mo. Turner v. Kansas properly single ture could in- out the 857, proper 612, 191 A 617[8-10], S.W.2d police dustry for a of the valid exercise police power exercise of the is essential power remedy of the conditions State to a community the continuance life in industry. found to exist densely its populated center urban convenience, public safety, health, morals, proceeding Before further prosperity, welfare, interest and respondent’s the val regarding contentions vary specific locality which and the with the Act, say that it is idity'of we should changing requirements of life from time apparent pass on the face of the Act that in City, supra. time. Turner v. ‘The Kansas ing Legislature purporting it the act police power is of the of the limit exercise police power and that of the State necessarily flexible, it has because to be monopolies prevent designed the Act is light of the and the considered times competitors practices by and unfair trade Gordon, prevailing conditions.’ State v. public propriety, good. “The wis 477, supra, 480. Conn. A.2d [143 698] dom, expediency legislation enacted ‘Upon depends securi power) (police police power exclu pursuance ty order, health of social the life Star sively Legislature.” a matter for the citizen, the comfort of existence Gerk, Square 325 Mo. Supply Co. Auto v. thickly community, enjoy populated a 997, 462[14-16]. life, private the ben ment and social power is very police its “From nature the Inv. Co. property.’ eficial use of Bellerive power to exercised limits be within wide Mo. City, v. S .W.2d Kansas ap legislative discretion and statute if 635. apparent pears scope of this to be within the case, power inquire “In courts will not into its wis the last mentioned where attacking policy, plaintiffs-appellants were dom and undertake to substitute therein or appealed from an city legislature.” that of the ordinance and had their discretion for Breshears, ‘It has said: judgment, this court Poole & Market Co. adverse Creber clearly definitely established supra, 23, 27[1-5], “The ex S.W.2d of this court police power by settled, the state or the the decisions ercise of its Court, Supreme that a city improper in federal only can or and of the declared municipal ordinance, imposed regulations when rules and statute valid power police fairly can said to be unreasonable.” referable thereunder discloses Reynolds, municipality, Vogt Mo. ex rel. state State ali- face, Further, or which be shown 934. 244 S.W. bur ' pro- unde, to been enacted for show the den to unreasonableness of peace, police pow tection, furtherance, regulation under the statute health, comfort, safety, morality, gen- upon asserting invalidity. one er the is Mo.Sup., the state Johnson, v. of the inhabitants of 304 S.W.2d eral welfare Passler * * * municipality in- rights Private cannot held under the 903, or 908[3-7]. appellants subject wrongfully depriving the to the valid as Constitution exer valid by police power by any privilege guaranteed right the or the cise of the State for 745 application “Validity, construction and federal; reason Constitution, the state or statutory provision sale of com- being prohibiting underlying and basis such decisions cost,” 128 1126 and modities below A.L.R. of the personal property rights that the 118 A.L.R. 506. individual are and subordinate subservient society, the welfare case, In the New York milk control Neb community or- large, at a statute or People York, bia v. 291 State of New po- fairly dinance which is referable to 940, 502, 505, 516, U.S. 54 S.Ct. 78 L.Ed. power object “greatest lice has for its 1469, 1483, 89 A.L.R. Su States United ’ good greatest Bellerive number.” preme require Court said: “So far as supra, City, Inv. Co. v. 13 Kansas S.W.2d process concerned, ment of due is 628, ; City, supra, Turner v. Kansas 634[1] the absence other restric constitutional 612; Rouveyrol 191 S.W.2d State ex rel. tion, adopt state is free to eco whatever 669, 686, Donnelly, v. 365 Mo. policy nomic may reasonably be deemed 674[1^‡].” promote public welfare, and to enforce policy by legislation adapted purpose. to its Mississippi The court in the case of Milk * * * public Where the was interest Vance, 814, Commission 129 v. 240 Miss. require deemed fixing minimum 642, 652, 660, So.2d after at reviewing some prices, expedient has sustained. length many cases control acts sphere the lawmaking body If within its from throughout country, the entire arrived government concludes that the conditions or at the following conclusions: “All of the practices industry in an make unrestricted acts,

milk control which have been referred competition inadequate safeguard of to in the foregoing pages, pat either were interests, produce the consumer’s waste after, of, terned contained essentials public, harmful to the ultimately threaten the Milk York, Control Act of New cut off supply commodity of a needed passed upon Supreme Court of public, portend the destruction of New Supreme York and the Court industry itself, appropriate statutes United appeals States in the Nebbia v. passed in an honest effort to * * correct * People York, of State of New consequences threatened may not be set 502, U.S. 54 S.Ct. [291 L.Ed. 940]. aside because the regulation adopted fixes prices reasonably Legisla- deemed The rationale “[1] of the deci- ture to be fair to engaged those in- sions, upholding the constitutionality of the dustry public. the consuming and to And acts, milk control industry the milk especially where, here, so the eco- public with a affected interest and that maladjustment nomic price, is one of legislatures, several in enacting such producer threatens harm the at one end laws, exercising were police powers of the series and the consumer at the other. announce, state. These clearly cases The Constitution does not any secure to and in fact there authority is no to the con- liberty one conduct his business in such trary, the state highest exercises the injury fashion upon public inflict governmental authority when it invokes its large, upon any at substantial group of police powers. words, police other people. control, Price like power precedence takes private over all regulation, form of only unconstitutional rights even though they stem from con- arbitrary, discriminatory, if or demonstra- stitutional bases.” And see Schwegmann bly policy irrelevant the Legisla- Super Bros. Giant McCrory, Markets adopt, ture is free to and hence an unneces- 606; 237 La. May’s Drug So.2d sary and unwarranted interference with in- Commission, Stores v. State Tax 242 Iowa liberty.” dividual 245; Jersey N.W.2d Maid Milk Products Brock, Co. 13 Cal.2d relies the case of Har- P.2d 587. And Duncan, see annotations on ris v. 208 Ga. S.E.2d

.746 public opinion a fur- industry with interest.” The 'where held the milk the court that pub- a public ther concedes the term “affected with was not “affected with a interest” precise susceptible lic Assembly interest” that the was not au- is not General price of pass the definition. fixing thorized an act process milk without due violating the Act that the We must and do hold opin- clause of the state constitution. The police was within and referable the pointed ion that that court was out power only further of the State and the construing bound in state constitution the questions concern the reasonableness of Supreme rulings of the United States relationship regulations adopted and their of a right Court which had twice held objects sought to the obtained. prices fixing state to of milk authorize the against act vio- the contention that an Respondent’s is main second contention process lated the the Constitu- due clause of prod- “Prohibition of milk that the sale tion The court fol- of the United States. products in- of such ucts below ‘cost’ opinion reasoning dissenting lowed of a im- indefinite and vague, because it is valid People of in the case of Nebbia v. State ac- application, that cost practical said: supra. Georgia court York, New necessarily occurs after sales counting As- that the General recognize we “While made, cost must frequency with which milk that the sembly to find was authorized prescribed, whether is not be determined product of a industry large, milk was was average prescribed, used is not costs State, (cid:127) virtually throughout the universal use joint, allocating common and the method n that was important a perishable, hu- proc- materials, and indirect costs rawof health of the food, man and affected delivery prescribed.” essing and is not was im- people, that it and to further find adequate and constant portant keep an Act contends producer and price fair both supply at a penal the Due a statute “invalid under qualify would not consumer; yet facts such Fourteenth Amend Clauses Process business ‘af- being a industry as the milk (Sec. Missouri Constitution and the ment interest,’ notwithstand- public with a fected Respondent’s theory that the I).” Art. Assembly General public or the ing upon penal in nature is based regard feeling concern a would recovery provisions damages of treble 692, 694.) (67 S.E.2d to its maintenance.” for violations. ouster from the State Act, 20 of Secs. now See Gwynette v. Respondent also relies 416.455, Re 416.490 416.505. Secs. 673, 676[3], 17, 115 S.E.2d Myers, S.C. particularly directed spondent’s argument business held that the Court where Act, 2 of the now 416.415. at Sec. Sec. public with the not affected milk was selling is as follows: section This prices milk regulation interest 2. “Section police power. The beyond the State’s that, here is “Involved said further court processor shall, or distributor “1. No health, safety or public unfairly or intent with the effect only issue concerned morals” competitor, or of diverting trade fix the right of State asserted competitor, or injuring a of de- otherwise holding at of milk retail. minimum competition, creating or of stroying industry was not affected with milk advertise, offer to or monopoly, sell sell clearly adopted Court interest the public Missouri, at wholesale the state within However, viewpoint. opin- minority retail, product for less than or power state has concede does ion processor or distributor. cost prices that one control regulate advertising, offer sell n private “2. Proof may charge goods business processor sale is “affected such business where services expenses proces- monthly, products are all totalled distributor cost for less than points are assigned “points” of sold the evidence and prima distributor sor is facie totalled,, per are average cost violation of then this section. point quart is of milk is as- determined. A products profit sale of “3. A from the signed point, cottage one cheese a carton products than milk not used in cost is is assigned point likewise half- one and a computation to or lower the cost subsidize pint that, point; cream is assigned one respect doing to milk with business under this accounting, method of the cost products.” quart allocated to a milk of chocolate is assigned quart same homoge- that (now Subsection 5 of Section 416.- § milk, nized actually although chocolate milk provides: 410[5]) milk because homogenized costs more than “(5) processor ‘Cost to the or distrib- added; this sugar that and chocolate are utor’, price paid materials, plus raw accurately system of does not accounting business, the cost of doing in- shall relationship selling show the exact labor, clude paid salaries executives and prod- the various to the actual cost of officers, rent, interest, depreciation, power, ; Company generally that ucts had some supplies, equipment, selling maintenance knowledge idea but not “a real accurate costs, advertising, transportation and de- product sold; actual that cost” of the costs, livery losses, types per- credit all Company averages working fees, taxes, mits and license insurance, all operation the cost in milk accounting expenses processor overhead impossible to complicated it is almost so or distributor.” items; opin- that in separate his the various point per as determined average ion the cost to sell “below all sales or cost” Not offers present bookkeeping Company’s Act, prohibited by since Section are relationship to the actual cost methods has provides exemp- certain (now 416.445) products; various processing exemp- need not consider these tions. We relationship although it some that has at time. tions this Company didn’t “a real accurate points properly out that cost”; knowledge of in re- the actual that statutory prohibitions against several plant they have spondent’s one boiler room milk of milk and “below cost” sale engine one room and the steam pur- essential to the fulfillment of the are operation opera- ice cream and the Act; prohibitions that poses of the such boiler; come from same that tion Act; primary aim that accurately Company cannot determine the prohibitions given these can be whether required of fuel or steam amount for each application meaningful and fair was the department, actual let alone the amount that litigated only issue below. The evi- central product goes itself; into the individual that by the court was heard on this issue dence refrigeration is true for the same since respondent relies evidence. impossible accurately distribute the re- frigeration cost between and ice cream vagueness, issue indefiniteness On chocolate milk cottage cheese; application impracticability of of Sec. plaintiff’s under method accounting there plaintiff-respondent offered as a witness ' segregation between the cost of City Manager the Kansas Branch merchandise delivered at wholesale and the Company. testimony Milk His Borden of merchandise delivered cost home de- impossible that it is to show for him tended drivers; livery that there separation is no accurately determine cost of one delivery cost between prod- various week; any day item specific his impossible it is tie ucts and average cost down Company used the accounting; delivery plaintiff’s accounting specific method of item; costs to individual .748

he Company’s didn’t par- know what costs selling any the determine whether it was particular on a just particular were any day route because he ticular item' on below threw and together item, wholesale retail routes the cost of it the can tell the aver- up general age and came profit with a distribution of on all items whether there is a cost; loss; price plaintiff pays that the that farm- he of the knowledge to has some for raw by being ers milk is the matter as to set Federal whether milk is profit, Government, at a he (Federal Administra- sold but could tell Market not wheth- dock; Company Order er 13), making money tor’s the was on a plaintiff’s No. f. o. b. that when carton purchased cottage raw milk from twelve-ounce of cheese is money quart buttermilk; losing on a of that handling or handlers, additional there are plaintiff a price has never to costs; the tried introduce that while transportation system of accounting cost which give each would is uniform by the set Government information; that can to that he estimate raw may vary from month price month month, early milk in costs before the made is price announcement and the month price announced, market order is within a date, and effective days after the or six five quart, profit half-cent a average but the delayed much ten twelve as as may be industry for the entire is less than half plaintiff does period during such days; that quart; cent a he that could not tell wheth- milk cost raw idea not have Company money losing par- er aon receiving vat buying; that which it is quart milk, ticular he but admitted that acquired at which was raw milk may have average knew what per point, cost was it contains prices, where cost different he although not could fix the exact cost of milk; that handlers’ milk and producers’ quart homogenized milk.' milk in as to delivered also varies price milk, since bulk tank cans ten-gallon Plaintiff offered as a witness on cost ac- deliveries; that on bulk paid premium is counting Taggart, Herbert F. one Professor plaintiff produced by is largest item Accounting University at the Michi- produces milk, also it homogenized qualified gan. expert He as an ac- in cost cream, cream, whipping coffee by-products, counting very and stated that few businesses milk, chocolate half-and-half, skimmed systems accounting permit de- cheese; cottage that milk, buttermilk termination product; of the cost each milk, produces cream-line plaintiff also that the list of items of cost that re- are that order homogenized; not is quired to be taken into account under the prod- butter content standardize give any here does not in- is often added milk uct, or skimmed cream formation about how'the different items are milk; that cream skimmed raw be treated or how costs these are to be by separator produced use milk are products, among allocated which is an ex- is milk also used to stand- skimmed tremely problem; difficult that Act does milk, or is sold homogenized ardize say how are often costs be ascer- cheese; cottage or made into milk skimmed leeway much tained how there is making used some skimmed that for given judgments estimates and types buttermilk; pas- different that involved; and manager cost accountant that homogenized for are used teurizers dairy ascertainment costs in- milk than used for butter- skimmed dustry present problems of extreme com- milk; chocolate that ho- milk, cream or joint plexity degree because costs milk, homogenized used for mogenizers dairy extremely great; industry, creamy milk, mixture for sour meat-packing industry, oil refining cheese; that milk cottage used lumbering examples joint are excellent by packaged different types of joint industries product where costs are types' in different of con- acute; literally machines particularly that there Company possible tainers; could not which it determine that while method “factors”, allocating cost is products; use joint the material cost in fairly ac- of which be “a cost the use there can there is a method of recognized cost different selling is used accurate distribution of the counting where the product”; factor such cost ac- compute costs, costs are calculated where every month or at price; counting should be done selling backwards from quarter; system will products least by the trucks each that his are delivered same yield product; such any effort allocate cost of the finished and drivers and very average that particular cost different products costs would be of the products not arbitrary a man- can be determined. He was doing and not worth agement “point particular familiar a author’s book standpoint; plaintiff’s that with is not purposes, accounting method” is which stated that: “Cost not too bad for some science, although produce it Company that exact ac- realizes nor does ac- method curate of yield according does not an exact and results the standards per analysis. any particular prod- joint curate cost unit for statistical The existence ; that it tests uct does cost trends and show production selling costs, in both the and the methods; management that because of enterprises, divisions business makes it n fluctuations in and in demands impossible cost compute costs for de- accurate various products, different cost results partments, services, production. or units of they computed would be obtained if were departments operations produce Most two or monthly, semi-annually annually; products labor, equip- that or more with the same joint force, because supervisory de- storage costs in ment and while neither livery, half-pint factory the cost of a to a nor costs selling overhead overhead dairy particular simply customer can day specifically particular on a be identified with ascertained; products.” could not be that the alloca- activities or witness further delivery tion of is complicated by costs said that there are alternative methods fact that savings accounting there system are cost large-volume that under the deliveries, accounting so that the might vary product cost ac- which he uses the cording customer; product that cost is determined language after the has al- sold; of the Act ready does that not furnish there are different sufficient depreciation, instruction him to how methods of know which are to do the accounting recognized as correct proper, determine whether but each processor not the produces result, is selling particular slightly method different product time; particular system below cost at a but that under his the determination plaintiff’s system that particular product of a accounting cost the cost in ad- production good does not approximation ascertain par- vance is a of the cost precision degree particular necessary product. ticular would be cost Act; plaintiff’s under the system does particularly relies upon the produce approximation reasonable case of Kansas of State ex rel. Anderson v. products costs for individual and to ascer- Co., supra. Fleming The Act there consid- require tain such costs plaintiff would prac- ered is referred to as “an unfair trade change system. dealing only dairy products tices act” with Defendants offered the thereof. Act testimony and the sale was attacked Solzen, “First, Florian V. an accounting ground, consultant no criminal working required for milk and statute, ice-cream intent under the dealers in but that setting up systems accounting any dairy products for for financial the sale of less than wholesaler, processor cost accounting. This witness cost to the testified distrib- that one has to average prices use the made to constitute be- utor is criminal act. * * * Second, particular cause one cannot know definition of ‘cost whether a that no product delivery’ point amount base is contained went cer- at the into products; to be proper tain other that the was also said act.” The indefinite method ent also of de- liability” in it insists that the “allocation exceptions “as to as to livery an in- particular products costs to “made only permitted sales below cost herently problem.” Respondent competi- insoluble existing good faith to meet lawful says that used to where raw material opinion points tion.” The out produce dairy proc- products, several as in attempt cost and that made no to define essing, the allocation of the raw material expenses silent as to “what totally delivery costs processing costs and the the cost at arriving to be included in at among purely arbi- point said: the several delivery.” The Court further statute, trary “accurately and cannot be allocated a criminal “It must be evident that particular products.” Respondent and its requires criminal intent neither requires ex- witnesses doing proscribed assume that the statute act or defines forbidden, is in- absolute exactness in the determination actness and further the act will liability, approved system must some exceptions cost definite as to as to particular process one determine the exact cost of deny be due considered to day quart particular of milk on a against delivered whom the statute is asserted.” ex- particular to a and that such customer district court held the Act unconstitu- had always upon the act cost must be ascertainable entirety, apparently tional in its particular some think theory patently method. We Legislature that the would given practical must statute be a more not enacted without the statute the statu- reasonable construction and that that, particular there- sections attacked processor tory definition the term “cost to fore, the entire statute was unconstitutional. upon distributor” shows that aver- face Supreme judgment Court held that quite agree that age costs are intended. We was set aside broad and the order too business, doing mentioned the cost of except specific subsections of as to two costs, statute, including labor salaries The Court the Act which were attacked. interest, rent, officers, paid executives and “The district court did not err said: depreciation, power supplies, maintenance (m) subsections of section finding (l) advertising, equipment, selling costs, process appellees.” 50-503 denied due to the cost, transportation delivery loss- credit Kansas v. And see State of Consumers fees, types permits and license es and all Market, P.2d 183 Kan. Warehouse taxes, expenses all and overhead insurance respondent, aid 638. These cases not do mention- processor or distributor as subject is not since the Missouri Act penalties set out. here is defects considered provisions of the Act and the items not a criminal statute and criminal mentioned. The Act may be determining imposed violations costs are on such definitely and ence day, ed in particular to a hour or minute requirement. Sec. particular quart milk ^[5] exactly date. (§ 416.410[5]) Practically The statute makes basis, determined or with all of cannot be delivered refer- accrue mentioned in Sec. items 416.410[5] further insists Respondent that consider- paid losses are sustained over or are or the given should to the trial able deference period of time. Some some reasonable findings testimony court’s on based here- necessary to determine them. lapse of time out, judge since the trial had set inbefore Clearly average costs be used in the opportunity judge the merits of better any product determining the cost of con- meaning and the fair of their witnesses plaintiff’s by the statute. In fact trolled testimony. construes the evi- plaintiff shows can and evidence own showing there are no methods dence delivery costs and does ascer- allocate does processor a milk can ascertain an average costs on basis to tain each of its cost hence quart cent on of milk. one-half within accurately no means determin- there that it can does shows fix ing Its evidence compliance Respond- the statute. general provisions.” p. Am.Jur., prices monthly government even before the Law, see Constitutional And Plaintiff’s Sec. 240. is announced. for raw milk Jer- Brock, sey su- average Maid Milk Products Co. v. evidence shows further pra; Super Mar- industry Schwegmann profit Bros. Giant for the entire milk McCrory, supra. kets half a Failure quart than sale of a of milk is less Legislature provide meth- the in- a more detailed testimony cent. This indicates od of establish ascertaining some cost does not dustry joint costs on does allocate Act, invalidity a standard where appears basis. that what It therefore and the up by Legislature, has been set respondent failure complains of is the determine determining Commissioner is authorized to provide rules for out the carrying than fix rules for less reasonable cost with exactness and to within purposes range. Act. per quart one-half cent supra, McDowell, In Borden Co. v. provides 416.460) (now The Act 146, 156[12], the Court said: N.W.2d and di the Commissioner is authorized regulations promulgate rected rules ap- “Respondents find uncertainties carry purposes 416.410 out the Secs. plication find that of the do>not law. We authority the Com to 416.560. Under necessarily alleged there are uncertain- may regula promulgate missioner rules and may may appear That when ties. or costs tions to how the various items attempts are in In made enforcement. may be al are treated and costs to be how are meantime should wait until there we products, how located among several application of rising concrete facts from the what often costs are to be ascertained and applications If unconstitutional statute. leeway, any, given if the estimate for attempted, are the courts must deal with those judgment manager of the business them at that time. clearly charge company. in The Act up sets a standard the determination “ gen- ‘In the construction of statutes it is particular fixes items which cost and they held to erally held that should not be may Leg be taken into consideration. they operative be too indefinite be because go need not the details islature into susceptible mean- terms not of exact contain allocating fixing particular method of details, imperfect in their ing, or are among it has set costs various but commonly they employ under- where words up ap a standard that will meet the test Statutes, Am.Jur., [p.] stood. 50 [Sic.] plied in All matters such case. 489, A statute should not be 473]. [sec. complained may by rea be taken care of uncertainty pronounced it void for if regulations sonable rules and any susceptible of reasonable construction. authority promulgate. Commissioner has 1898, County, v. Racine 99 Wis. Wentworth authority regula “The to make rules and appears why 26, reason 551. No 74 N.W. carry express pur legislative out an tions applied rules should not be to orders these pose operation effect and enforce agency. They should of an administrative exclusively legis of a law is not an ment any by if reasonable rule of given effect be power, but is in rather administrative lative they capable of administra- construction * * * policy the law its nature. Madison Bus Co. v. and enforcement.’ tion responsibility placing of detailed favors the 1953, Comm., 12, 264 Wis. Public Service * * * officers. A dis administrative in 463, 464.” 14, N.W.2d import drawn between the more tinction is courts, of some the decisions Under Sec. subjects entirely regulat which must be ant present apparent- form would in its legislature by the itself and those of less 416.415 ed necessity without of a sufficient general provisions may ly be as to which interest regula- rules and providing power given commissioner be made administrative carrying the Act into effect. carry out the details under tions officers to such only tested and each method be Tax could May’s v. State Drug Stores finally litigation. determined Comm., supra, 45 N.W.2d Court said: must do hold that Sec. 416.415 We much formula, respond-

“A cost doing business as against valid enforceable Wy act, present contentions; any alleged like the one our ent’s and that cost oming ap- below prohibiting vagueness, difficulty statute sales indefiniteness or Wyo. upheld Langley, plication in State be reasonable remedied language following regulations P.2d 767. The rules which the Commis- ap opinion adopt. with our authority which meets sioner has proval quoted has often been to sustain Respondent’s assignment third is that the constitutionality provisions in of similar permits findings Act is invalid because See prohibiting statutes below sales cost. impositions penalties with- violations and Associated of Montana v. Or Merchants requiring proof wrongful out Re- intent. ; mesher, 1031 107 Mont. 86 P.2d spondent argues: prohibi- “The substantive Ass’n, 107 Dikeou Food Distributors apply irrespective wrong- tions in the Act ‘Hence, Colo. 108 P.2d 533: is, ful (Secs. intent. That sales below ‘cost’ contrary, provisions the absence of 5), (Sec. area discriminations presume we did legislature must 3), (Sec. 6) combination sales and miscel- prescribe not intend to the cost must practices, laneous trade such granting absolutely exact, and that it must discounts and making loans to retailers precise based method of account (Sec. 7) are illegal, declared a violator ing adopt, might one merchant subjected damage to treble suits and ous- “cost,” men meant, what business ter from (Secs. 17) State 10 and even mean, generally namely, approximate though there injure, was no intent to di- or Hence, by cost arrived at a reasonable rule. from, vert competitor trade a or to harm particular adopted if a by method mer a competition. This results from the statu- cannot, disclosed, chant under the facts tory language, repeated in all substantive unreasonable, said to be and does not dis prohibitions (Secs. 2-7), imposes law, close an intentional evasion of the prohibitions when there is ‘the or intent adopted accepted method so should * * * the effect’ inju- of causing such words, correct. In other all that a man is to, of, or diversion ry trade harm to or com- required to do under the statute is to act in petition.” good Hygrade faith. Provision v.Co. Sher man, 497, 141, 266 U.S. 45 S.Ct. 69 L.Ed. particular provisions last referred case, 402. In that view of the the standard prohibit sales below cost “with the intent legislature set is virtually reduced to with or unfairly diverting trade effect of one “reasonableness.” And it is held competitor, or otherwise injuring- from that “reasonableness” as “the standard of competitor, or competition, destroying act, an which can objectively be determined * * or creating a monopoly (Ital- circumstances, common, is a widely- ours.) ics used, constitutionally valid standard in People Curtiss, (§ 2 of Act law.” 2 Sec. Cal.App.Supp. v. 116 416.- Subsection ” 801, 805, provides: 300 P. stated “Proof of the ) and cases cited.’ And 415[2] Langley, advertising, offer to sell or sale of supra, see State v. and Associated processor by a or distributor Ormesher, Merchants of Montana supra. v. processor cost to the or than distribu- less permit wé believe that apparent is It of a violation prima evidence tor facie only “good on a ascertained faith” to be cost section.” basis would leave each “reasonableness” (now 6 of Sec. 416.445 dealer to determine his own Subsection processor method determining cost and the validity ^[6] ) states: provides imprisonment. case for fines and 416.415 provisions of sections “The advertisements, However, Ross, supra, of- State v. the court apply to 416.430 do not * * * that, held in the absence of a showing to sales where: fers to sell or contrary, it could be concluded that a mer good faith price is made of the item competition, selling goods chant price below cost fixed equally lower meet statute person charged violating does so with the intent of however, the provided a violation of this section tively proves the reduction in further affirma- the Act. 460, 464 ^[5] The Court said ) : “The plaintiff (l. c. 48 N.W.2d established herein that the defendant had the effect advertised made with the intent or with sold cost, items of merchandise below competitor, unfairly diverting trade from a any defendant did not offer competitor, or evidence injuring a otherwise in his behalf to creating show that competition, he did not intend destroying or of to violate affirmatively In monopoly, statute. the absence of a and unless such showing the contrary, it can be shown, order en- concluded the court shall enter its that a merchant selling goods certain below charged.” joining the violation as cost fixed by statute does so with the intent provi these concedes Respondent of violating the statute.” by McElhone supported sions May's Drug Stores Geror, supra; and v. police exercise of its supra. Respond Commission, State Tax v. power power prohibit has the the State v. Englebrecht case of upon the ent relies set forth Secs. to 7 of acts of nature 538; Perkins 585, 208 P.2d Day, 201 Okl. spe (Secs. 416.415-416.440) without Inc., 221 P. 122 Colo. Soopers, King v. cifically providing that actor be motivat Ross, 259 Wis. 345; State 2d express injure ed intent Super 464, 465; Mott’s 48 N.W.2d partic criminal or intent. This willful Frassinelli, 148 Conn. Markets, Inc. pro the Act contains ularly true since Creamery 381, 384, and Fairmont 172 A.2d penalties and elimi visions for criminal so Minnesota, 1, 47 U.S. Co. v. State requiring necessity nates the criminal or says L.Ed. 893. S.Ct. an element willful intent as violation. cases, Fleming supra, Englebrecht and Stores, May’s Drug Inc. v. State Tax Com May’s Drug the McElhone considered ; mission, supra, 245, seq. 45 251 N.W.2d et holding. rejected their Stores cases Geror, supra; Schwegmann McElhone v. Englebrecht Respondent insists Super McCrory, Giant Markets su Bros. v. judgment of be followed and the case should 606, [6]; pra, Griggs, 617 Rust 112 So.2d the trial court affirmed. 565, 733; S.W.2d Milk Con 172 113 Tenn. Division, Dairy Rieck Commission v. trol Englebrecht case construed The Pa.Super. 32, 163 A.2d 893. etc., 193 statute, statute, a criminal the Oklahoma ground no valid for a strict con There is could be fines assessed not to there against the Act the State in struction of n exceed$500. The Connecticut statute ruled think it given and we be proceeding must provided for case fines for vio in the Mott order construction in that its bene liberal and the Colorado statute lation ruled purposes, subserved. ficial makes violation of the Act a Perkins case Respondent contends further Act recognized The Perkins case misdemeanor. prohibitions its are Legislature because based declare the is invalid right “unfairly term diverting uncertain on the proof presumptive fact shall be of one another, (Sections Act.) 2—7 The being evidence of trade.” prima no facie found the term to be vague and open dispute trial court longer juris to serious in that Respondent insists that “the indefinite. diction or elsewhere. It is well settled unconstitutionally vague is bar creating criminal statute at statutes offense must be competitive practices ‘un- prohibiting strictly against construed the state. The competitor.” from trade- Re- fairly’ divert Wisconsin statute dealt with in the Ross 754 “unfairly competent

spondent says that the term di- course give to decide and to patent- competitor is verting trade” from a reasonable definition and construction of says is- ly proper words used ambiguous. pre also when case sented. heart the substan- sue strikes at the of all Whether or not a sale below cost unfairly would au- has prohibitions tive of the Act diverted trade is a matter proof be- in each judgment thorize an affirmance of the instance and depend must on meaning of the facts and determining low. circumstances shown. provision respondent subject Act would the mentioned to a remove reasonable inter pretation. Scearce, context it is used See term from the in which Mahon v. Mo.App., 228 S.W.2d the several sections with reference to 388 measure); (fairly to Chapman v. State Security sales below cost. Social Commis sion, Mo.App. 235 147 S.W.2d 159 Corpo- Respondent cites General Motors (fair Muffet, hearing); Mary Inc. v. Smel Blevins, D.C., 381, 395, F.Supp. ration v. ansky, Mo.App., [7, 8] where the court that a stat- held Colorado (unfair ; competition) and Miller Kansas making ute it unlawful criminal and a of- City Co., Power Light & Mo.App., 332 S.W. for an manufacturer or automobile fense (unfair 2d 18 labor practice). cancel fail distributor to to renew a mo- agreement “unfairly, dealer’s tor vehicle The Act is vague, not so indefi regard equities without due of said nite and respects uncertain in the men just provocation” and without dealer vio- tioned as deny process, due is a provision process lates the due the Four- valid police exercise of power. teenth Amendment to the Federal Constitu- provide tion for failure an ascertainable Respondent next contends that guilt. said standard court also is “invalid because it arbitrary creates penal the terms of a creating statute a new presumptions violations, proof from sufficiently offense explicit must in- facts which are reasonably probative those, it, subject form who to what con- wrongful intent or harmful results.” part duct their will them render liable assignment This is directed to the second penalties. paragraph of the second section of the (now [2]). Respondent 416.415 in- application here in view The case has presumption sists “the of misconduct of our statute. A case more wording (as Act) defined in the proof in- Trade Commission v. point is Federal dicating sales ‘cost’ below wholly arbi- 572, 575, Gratz, U.S. S.Ct. L. trary unjust, basic violates the “The Court words Ed. where said: concepts of fairness which have at- competition’ are not ''unfair method de ” ‘due process.’ tached words Re- meaning statute and their exact fined spondent Great cites Atlantic & Pacific courts, It is for the dispute. not the is Ervin, D.C.Minn., F.Supp. Tea v. Co. 23 commission, ultimately to determine as mat 70; Wiley Sampson-Ripley Co., v. 151 Me. they They what include. ter of law are 289; Super Markets, 120 A.2d Mott’s practices clearly inapplicable to never here Frassinelli, v. 148 Inc. Conn. 172 A.2d opposed as regarded good tofore to morals Respondent deny 385-386. “does not by deception, characterized because bad may presumptions, statutes that create faith, oppression, against fraud or or as reasonably they proof follow when from policy public dangerous because their facts, plaintiff unduly nor does tendency competition deny that to hinder price- be occasions there when a monopoly.” create predatory acts with a purpose,” cutter says that, act respondent Whether an is committed “such a motive with ** * intent or with the effect nor “unfairly neither universal di is even usual verting competitor”, attempt from legislative trade a therefore to ar- court

755 California, People of a Morrison v. State into possibility a mere bitrarily boost 281, 284, 88, 89, 78 291 U.S. 54 S.Ct. invalid.” probability is L.Ed. 664. In the case the Court Morrison respondent deal relied The cases that said: “The decisions manifold are proof where statutes with criminal within the limits of reason and fairness statute Missouri required. The intent is proof may the burden be lifted not is penalties and criminal contains no prosecutions state in cast criminal required to statute, is not criminal on a sub defendant. The limits State. against strictly construed be these, stance shall have the state ap- case, supra, Company has no The Tea proved enough just for de make it to re- clearly appears from plication as here required repel fendant to has be what spondent’s reference statement proved explanation, with excuse or provided that follows: “The statute upon balancing least that of con at than proof grocer’s sales less of a at opportunities venience or of the for knowl price, published less list manufacturer’s edge shifting burden be will mark-up statutory discounts, plus a found to be aid an to the accuser without business, only ‘not doing were the cost of subjecting hardship or the accused to prima evidence the sale facie oppression.” Schwegmann And see Bros. vendor, cost, but also sale below Super supra, McCrory, Giant Markets v. sale, injure intended com- making So.2d 617[6]. ” competition.’ destroy petitors and Respondent that, “the next contends applicable rule well provision for statutory mark-up non- Cook, City stated in Louis St. v. processing retailers of milk is invalid 468, 470, Mo. as follows: arbitrary interference with freedom of contract.” refers to Sec- regard process, “Giving a to due (now 4 of tion 416.425) § evidentiary provide rule such an power to paragraph 6 of Section qualified in that the fact (now 416.410[6]) re- where “cost must presumption or inference rest is to tailer” is defined “the invoice connec relation to or natural have some paid by plus the retailer the retailer’s cost inferred, fact to be tion with the doing spe- business. the absence of of the fact inference existence doing cific evidence the cost of business from the existence be inferred presumed per eight shall be to be cent of arbitrary purely proved must fact price, invoice this cost shall be cal- unreasonable, unnatural, wholly or ex nearest per culated half cent sales * ** clearly traordinary. And it unit.” prescribe power beyond legislative conclusive evidence of shall be what Freedom of contract is of Wells, 323 Mo. O’Donnell

fact. * * subject to a valid course exercise of the ‘only es *. It S.W.2d (Turner police power state rational there shall some sential City, supra), but an Kansas act which proved the fact between connection purports police to be an exercise presumed inferred), (or fact the ultimate unreasonable, arbitrary, power must not be fact inference of that one and oppressive beyond unduly patently not shall so unreason proof of another be ” of the case em necessities and means purely arbitrary be a mandate.’ as to able must have a real ployed and Mobile, substantial & K. R. C. Co. v. And see J. object sought 35, to the to be ob 136, 137, 31 relation Turnipseed, 219 S.Ct. U.S. presented On the record we find tained. see McFarland v. 78. Also L.Ed. 55 power. police 79, exercise Fur a valid Refining Sugar Co., 241 American U.S. 899, respondent is not a 498, ther, non-processing 60 L.Ed. S.Ct. 36 756

retailer, right er case a of that insist that has a determination whether does it fatally by object 4 the Act on subsection is reason to Sec. defective oper- directly ground that is intended its failure such Act describe sales, Bengsch, as 170 as sales “for less than costs to the ate State whole. v. not retailer.” Mo. 70 We need S.W. 719. issue, objec- ruling rule because in stated, apparent respond- As it is we (§ 416.415) tions to 2 of the Sec. objections ent’s Act (now to Sec. 4 of the have, effect, respondent’s objec- ruled 416.425) objection are similar to tion to And see State rel. State Sec. 4. ex 2 of Respondent par- Sec. the Act. relies Pigg, Board Mediation v. Mo. ticularly upon supra, Duncan, Harris v. persons (Only S.W.2d 78. such Gwynette Myers, supra, rep- way prejudiced by are in as some an un- a minority holding resent view in complain it.) can

constitutional law industry pub- is not “affected with a power lic police interest” and that Respondent paragraph further refers to order, promote safety, the State to statutory 6 of the Act “the Sec. as health, may morals and welfare presumption grocer’s doing that a cost of not regulate exercised be to control and per eight business is cent of the invoice products by the sale milk and milk an price applies in grocer.” to the The rule act, practices unfair milk sales and that specific absence of evidence of cost. process such acts violate due of law Respondent says arbitrary this provisions of the We State Constitutions. attempt price-fixing, unreasonable “be at refuse to follow these cases. required cause the grocer’s allocation particular product presents a costs to a accountant,

difficult to the cost task Respondent complains next necessarily adop provision results (§ Sec. 3 of 416.420) and insists by markups, grocers of statutory uniform prohibition tion against that: “The 8% operations require whether their or not price area discrimination vague and in receipts, definite, Many such in order to assured that be and therefore invalid.” they selling objections not violation of the section have been Respondent says that, law.” disposed portions further “con preceding of in of this opinion sumers Missouri will suffer from the repeated not be need here. arbitrary legislature choice “price further insists that dis 8% price as presumptive of invoice cost meaning, crimination” has no fixed However, doing retail business.” ambiguity arises from the reference wisdom, propriety, expediency leg transportation costs,” to “actual and from pursuance enacted in of police islation the fact that cities towns are located exclusively power a matter appear in counties so does not what Legislature, police and the exercise of will We control. do not find the only power improper can transportation cost,” declared term “actual or the regulations when rules and price” invalid im “discriminate in words to be so posed thereunder can be said to vague be unrea deny proc indefinite due Johnson, Mo.Sup., Passler application sonable. ess. If of the law ma 903[4]; May’s Drug Stores appear terial difficulties or uncertainties Commission, supra, Tax may v. State they N. be corrected reg rules and promulgated W.2d Commissioner, ulations 249[3]. proper presented or a case Respondent further refers subsection Difficulty applica court for decision. (§4 416.425[2]) Sec. “the defec- does make a tion statute unconstitu evidentiary rule for non-processing tive Geror, supra. Many tional. McElhone v. (grocers).” prop- arguments retailers We leave to properly of the made should be some- validity statute of a appears sustained the Legislature as the directed to contention, in North enacted that that what similar to respondent’s next on relies Respondent also Dakota.” prohibition “combination” statutory the for rules Gwynette supra, which 416.435) Myers, prices (now in Act of the § Sec. industry.” enterprise “free an in- arbitrary with “is an interference of7 Sec. Respondent says that this Respond- further practice.” nocent and desirable desir- destroy system the Act the same would objects ent also this section possible prevent disposing able in order to practices grounds that been ruled in have for issue was the Again, We complaints sections. future abuses. courts. the Legislature for and not in and additional find these new no merit police power provision is within objections the Act. 3 and 6 of to Secs. arbitrary find it We do not the State. complains of Respondent next and unreasonable. in (now 416.440) Sec. of the Act § that contends Respondent further prohibit

sists that the Act “is invalid prohibit process in ing “violates due assistance to volume discounts and self- process ing absolutely right economic grocers, due thereby taking without grant competitors plaintiff, against who liberty property law the defense assist discounts, pricing or con including right to make lawful use combination ambiguous terms property grocers, limiting and to tracts make use against arbitrary Respond self-defense right of such regulation.” without price engaging in area says ent this “con cutters and sellers that section of the Respondent insists pointed price all of tains the standard out discrimination.” defects prior right of economic against in” sections oth that of the of the brief the denial Act, sustained er sections insists has never of the and further self-defense denial practices ‘prima “the and constitutes clear treated as the courts facie' innocent, the State process violations the act clauses of are fact due Respondent fur apparent It wholesome and Federal desirable.” Constitutions. exemption pre section argument latter should be insists ther entirely (now 416.445),is Act, than to Legislature sented to the rather Sec. 8 Further, right rights inadequate claimed denial and that Court. subject are “undoubt to a would valid exercise of economic self-defense police power process clauses of edly due State. violate the quotes Re length at from Fairmont Food and Federal Constitution.” State N.D., Company Burgum, spondent says 81 N.W.2d an area differen 639, 646-647, part allowed, “The as a defensive might as follows: tial not the mer practices (described above) act, trade not act are the defensive when unfairly They objectionable. might themselves the effect of chant competitor; and legitimate between from a diverting business transactions trade competi that, There are no to meet respondent wholesalers retailers. if seeks tion, showing relevant facts in the record threat faced might practices tendency that these Commissioner claim proceedings have had a competition monop not exemption create section does restrict ing that any practices. We competitive in apply Neither is there evidence olies. to these police pow practices is within prohibited that Sec. record think sufficiency of the any the State. bear relation to vice er of reasonable . Legislature. The morals, public health, exemptions affecting were evil * * de self-defense is right Respond- of economic welfare *.” provisions respondent under says nied persuasive ent this is more than the McDowell, Act, the extent stated but to Company v. Sec. 8 of the of Borden case 146, 156, 246, 99 N.W.2d “which authorized. Wis.2d

Respondent (now next contends that visions of Act Sec. 416.-. Act “unlawfully delegates 460). to the Commis August The Act on became effective Agriculture 29, prescribe 1959, sioner of right September to and this filed action was 11, accounting prohibit rules which vol may would 1959. We that assume not pricing authority ume mar reorganize and otherwise Commissioner will exceed keting practices granted industry.” Re the milk him will invade the to or that he spondent legislative 955, says further most of the p. that field. 11 Consti Am.Jur. purely procedural Act, provisions 240; be tutional Law, ex Priest Sec. rel. State directly 320; ginning Gunn, 314, not in v. Mo.Sup., Sec. are Colbert, volved in this Sec. 11 State litigation, but that Killam 273 Mo. Inf. that, (§ provides Act Jersey which 201 S.W. Maid 416.460) 55[6-9]; Brock, “the Milk supra, and di commissioner is authorized Products Co. 91 P.2d 30]; rected promulgate regulations [29, Am.Jur., p. to rules Pub carry to lic purposes” Act is not out Administrative 49. Law, Sec. subject criticism, if this authorization Respondent’s twelfth and final as details, merely deals with administrative signment objections to the Act is that the apparent attempt any that that Act, “unlawfully interstate com burdens comprehensive make this workable as field, merce and invades the antitrust marketing industry code for the milk will commerce, pre interstate has which necessarily require by the issuance of rules empted by legislation.” Federal This as broadly legis Commissioner which are signment is the Act directed to Sec. 19 of nature, lative in such rules and (§ 416.500). had to that sec Reference is regulations prohibited by are IIArt. Sec. provides: tion “Any person who of the 1945 forbidding Constitution operates a milk products or milk manufac delegation legislative power to executive turing or processing plant located outside Respondent says in officers. further sells, of this state and offers for sale legislation sofar as this and in authorizes distributes milk or milk this requires deed the Commissioner issue state pay provided shall the license fee give such “rules” in meaning order to in sections 416.410 to on all sales 416.560 statute, the statute is defective itself in this products except cottage state milk powers legislative abdication of cheese, shall subject to all Respondent says that Commissioner. provisions of sections 416.410 416.560.” engaged defendant Commissioner is sells, Respondent County, in Mercer Mis processes effectively legislative when he souri, products, fluid and milk manu prohibits by pricing requiring volume Moines, Iowa, plant,, factured in its Des delivery wholesale be averaged, costs crossing thus between Missouri line exempts when he to schools sales and when respondent’s major Iowa.' Also some of application delays he of the law to out competitors in City, Missouri,, the Kansas standing loans. area processing plants sell in Missouri from apparent respondent’s It located in Kansas. concedes. complaint authority granted is not of the “unless controls sales non Act, residents, they might easily Sec. 11 of but as whether or become domi - nant may in the market in the' reg Commissioner make-rules and Missouri counties n legislation line, by accessible state pro ulations which constitute engaging in provision. competitive practices hibited constitutional We forbidden may validity However, respondent to local any not determine the dairies.” rules in - attempt regulations proceeding sists that the to control the or de inter- - validity clearly state milk market termine rules and invalid regu Clause, I, the' lations which Commissioner Commerce Art. Sec. Clause attempt comply made in an the -Constitution of the United pro- with the 3 of States...

759 (cid:127)' 752, the enacting such 83 says that, “in U.S. 59 L.Ed. Respondent S.Ct. Clayton stat Act, state Pennsylvania Court held that a legislation as the Sherman Act, industry, which regulating ute the milk Act, the Trade Commission Federal U.S.C., licenses, file required to (IS Act obtain and the dealers Robinson-Patman pur seq., and of payment bonds on seq., seq., 41 et conditioned 1 13 et Sections et pro pay (an producers to occupied this chases from 13(a) seq.), Congress et pre regula prices ducers minimum state least ti-trust) field and closed it to at agency Team scribed an administrative Respondent tion.” cites v. Garner Union, of sters, Helpers in Clause Local not violation Commerce Chauffeurs and etc., L. to applied 98 74 the Federal Constitution as 346 S.Ct. U.S. that, who, maintained argues dealer at receiver station Ed. 228. further milk state, purchased Federal him permitted within the pricing “volume under he farm, law, from a exception neighboring to Robinson-Pat- as an The shipped for sale. prohibition against price discrimina- to another state man “the forms tions, U.S.C., commonest 13(a)”; 15 Court said: “One Section nondiscriminatory police fur- state permits same act action is the exercise to con power local nishing and facilities directed to the services control free U.S.C., 13(e)”; customers, ditions and exerted in the interest of Section Every “discounts, rebates, adver- state allowances and Welfare of the state’s citizens. police inter may granted necessarily statute will affect tising charges service U.S.C., nondiscriminatory basis, but such degree, Section state commerce in some preda- prohibit grant of 13(a)”; statute does run that “Federal laws not counter to in tory Congressional merely below it pricing, power but do not forbid sales because cost”; indirectly to meet “price cidentally or involves or burdens reductions Federal even competition permitted are interstate This is so commerce. competition injury to exer law, though though, Congress even to should determine reduction, paramount law may power, from such a cise its the state result C., operation Company might thereby 340 U.S. Standard F. T. be restricted in Oil * * n pur Re- L.Ed. rendered unenforceable. S.Ct. 240 239].” [95 obviously spondent pose “the aim of this says also the statute under review competition, in the inter legislation is to create ‘soft’ is to reach a domestic situation philosophy producers con with the est of the welfare of the contrasted Pennsylvania. pro most its successors sumers milk Its Sherman Act and bond, respect license, the full bring to which seek to to consumers visions economy, prices producers competitive regulation paid even to be benefits of a may appropriate means though make it more difficult ends view.” Super Schwegmann And see Bros. Giant the small businessman survive.” McCrory, supra, 112 So.2d Markets v. Act burden inter Does the 618 [7-8]. pre a field commerce and invade state conclusion, say appears it think does In we empted Federal law? We regu object purpose of the Missouri Unfair Milk not. prevent purpose Practices Act is to commerce. The sale of late interstate Sales products practices milk below cost with the prohibit unfair milk sales attempts unfairly regulate sales intent or with the effect divert- It Missouri. competitor products within the trade from a ing of milk otherwise offers sell competitor, ac regulate injuring destroying of Missouri State creating a competition, monopoly. or of specifically to the sale of related tivities as we held is object have within within this State. This and milk power pro- of the State. The several police Milk Board of Penn case of Control Act, we Products, consid- sylvania Eisenberg Farm visions ered, arbitrary, against appellants are not unreasonable or entered the li- capricious, gen- paid they vague, neither are cense predecessors, so fees to defendants’ eral a impossible and in indefinite as to be this case must be reversed. reasonable, practicable fair, and adminis- judgment entirety is set aside in its They tration. clearly real substan- bear a and the cause is to remanded with direction public relationship tial and reasonable to declaratory trial court a enter new welfare ac- reasonably designed to are and judgment conformity ex- the views complish purposes In our the Act. pressed opinion. in this opinion and they process accord due respects claimed unconstitutional in the respondent. by HYDE, J.,C. and WESTHUES and HOLLINGSWORTH, JJ., concur. appellants’ as

We return to now signments appellants’ con of error and to EAGER, J., separate opinion dissents in tention that in order the trial court “erred filed. ing the and Agriculture, Commissioner of plaintiff his successors in officeto refund the $2,284.15,” sum forthwith the which sum JJ., LEEDY, STORCKMAN and dis- paid

had been to the Commissioner opinion and concur dissenting sent 416.490). Section (now 17 of the Act § EAGER, J. Appellants Act rely on Section 18 of All (now provides: “1. 416.495) § EAGER, Presiding Judge. moneys by and the com collected received matters, missioner, license fees arising from unanimity desirable While pursuant established 416.410 sections dissent, kind, after impelled am this I 416.560, treasury paid shall into state be briefs, au- and the of the act review shall, treasurer, placed be and the state do on the ground, thorities. I basic separate in a ‘Milk fund be known special legislation, that this act constitutes Control established. hereby Fund’ which is 3, 40(30) forbidden Art. Mo. Constitu- paid 2. of this fund money No shall out tion, 1945, gen- “The that: provides except appropriations general as assembly pass any eral shall not local * * * sembly for sections the administration of special gen- (30) law: where were 416.410 to license fees applicable, 416.560.” The wheth- eral can made and law paid required by deposited ap- the Act. er a law could have made plicable judicial judicial- to be Respondent 17 and 18 insists that Secs. ly regard any legis- determined without of the Act fell with rest subject.” point- lative As assertion on that respondent to recover was entitled and that Banc, City, McKaig ed Kansas out in unlawfully collected, citing the tax back 815, 817-818, Mo. few Howard, Kresge ex rel. State S. S. Co. v. provisions making states have constitutional Kleban 247 and 357 Mo. S.W.2d judicial question, determination a Morris, 363 Mo. 840. S.W.2d consequently states authorities other pay- further insists that also, are of little value. The court there and under was made under duress ment said, cit. test a. loe. 817-818: “““The provides law protest; and that common special appropriateness pro- law is the hand, remedy. Appellants, on the other objects visions it It is. excludes. which the upon the statute under stand not, therefore, includes, what law paid into the State money was collected special, makes it what excludes.’' treasury. * * *»> * * * The ordinance before persons provision engaged of the Act has been us excludes all busi- Since (cid:127) invalid, judgment selling all ness of commodities all mer- it follows held tion, judicial and we take notice of the fact except automobiles. chandise “price continuing there are recurrent or words, engaged persons it excludes all radios, sets, wars” in other commodities besides milk. selling television the business purposes legislative ma- A classification refrigerators, washing phonographs, heaters, must bear a re- chines, ranges reasonable substantial electric gas achieved, furniture, lationship object to be trailers, hard- equipment, golf it must not be or unreasonable. ware, many arbitrary articles. clothing and Taylor Currency State on inf. of Servic- v. singling reasonable 'There is no basis for es, Banc, Inc., 983, 218 S.W.2d 600. people Mo. engaged out those are who Defendants and intervenors refer fre- automobiles and exclud- selling business of quently in briefs the federal anti-trust ing people those sell the above who enumer- * * proscribing monopolies statutes re- (cid:127)ated and articles merchandise trade, straints and the federal cases and Defendants treat this intervenors thereunder, examples as an furnishing point lightly extent, rather a (as, to certain analogous situation. is no real anal- There opinion also does) with assertions point; apply ogy on this those statutes industry the milk recognized constitutes a all analogy "commerce.” suggested The n class,and that it has regulated. been long questions may answer other raised many purposes has, For it con- it will plaintiff, but not none this one. Certainly present tinue But to be. act abso- has of the federal cases have construed lutely nothing questions to do with of sani- question special legislation, no cases tation, quality, storage, inspection, health, or par- from other have states construed our (cid:127) actually nothing to do with distribution provision. ticular constitutional n supply, is, as such. It very counsel’s argument solely practices directed at “trade defendants’ and genesis The inter- monopolies to create tending and destroying arguments seems to lie in the case venors’ n competition * * *” brief, (Intervenors’ People of Nebbia v. State of New York p. 28). It is solely directed the economy at 502, 505, 291 U.S. 54 S.Ct. 78 L.Ed. (1934), the n of milk industry. 940, 1469. That de- 89 A.L.R. was 5^1 purpose, emergency this avowed temporary line with

In cision upholding an appears depres- as addition to our enacted legislation during :act now Ch. milk n 416RSMo V.A.M.S., 1959, long which has sought the thirties. Those sion Monopolies, in broad terms Dis- protected producers, dealt with farmer-milk not were Conspiracies. essence, (cid:127)criminations and basic competing The dairies. In the case 1891, many merely industry was first enacted in law held that was “affected followed, substantially public might .amendments have interest” and reg- be so with The act now con- legislation nature. No class was general ulated. sidered, though pursuing general presented same or involved. There are subse- aims, uphold singles quent out the milk business from which federal cases somewhat controls, rigorous (cid:127)all legislation temporary others and for not enacted as similar n measures, upon regulation (if not a “fixing”) based but consideration due Certainly equal protection industry on “cost.” the milk process the fed- n constitutes a point legislative constitution, class on the for certain eral —and however, purposes; perhaps are concerned here. In the briefs we opinion majority human more essential to health and cases are cited welfare and in the meat, bread, grain, vegetables, fruit, supposedly controlling particular than as clothing. Gwynette special legislation. medicines problem et None of al. v. Myers, 673; them, really these, point. we read 237 S.C. 115 S.E.2d Harris Duncan, merely prin- Ga. as the following 67 S.E.2d 692. note We Stores, May’s peculiar There is cipal Drug in the nature of cases cited: nothing In Commission, requires an 242 Iowa classifica- Inc. v. State Tax economic cigarette law pricing public 45 N.W.2d ordinance auctions- forbidding Sunday upheld. upheld was involved and The contention was against the attack special act was a seem that law does not constituted legislation. class “ said, court presented. part, illustrates case loe. cit. 885: ‘The legislative how far action com courts must go, question, determine the if as other modities, purely judicial questions determined, by articles or industries are to be out; singled opinion thus in reference subject; indeed the nature not. upon proof dicates (loe. pre conditions, had facts 249) Iowa cit. occasions, viously, theory judicial separate and on supplies two notice the- proof adopted know, similar what legislation regulating courts are bound to petroleum products and that courts must be produce. farm aware of those- things Geror, McElhone which are N. within the 207 Minn. common knowl- edge, experience observation W. the act considered of men- ” generally.’ act inap- sale of com make forbidding facts the case below cost plicable effect, here. In Clearly the ordinance use. that was was- general in modities amplification considered as an gen- consid legislation; not class eral Sunday laws (loe. 880), essence of cit. process, closing and the and' was due ered the long recognized power of might protect regulate that the state to holding was auctions (loe. cit. 882-883.) monopolies Note trade and also restraints against of applicable ordinance was already by our to all commer- forbidden very thing (the cial auctions. Certain other 416.400). & citations are to In Poole Creber 416.010 §§ wholly 1133, irrelevant. Breshears, may fairly 125 It 343 be said Mo. Market v.Co. upheld not a case cited a 23, prohibited the sale of even the statute law S.W.2d basically present similar any to which act as- any or milk derivatives added, against had been a oil fats or contention that it non-milk a constituted pos at both health and directed special measure law. It is any doubtful out-state if public. Borden Co. In sible fraud case could conceivably answer our Missouri McDowell, 246, N.W.2d 8 Wis.2d 99 problem. certain unfair 146, regulating a statute dairy industry in practices trade “anti-trust” laws long have general Our the act was not at- upheld, apparently permit adequate sufficient deemed been special any law con- a nor were public policy tacked our against enforcement of provisions mentioned relating monopolies, stitutional of trade and restraints unfair question. Kansas ex rel. In State of industry. such commerce or any branch of Co., Inc., Kan. Fleming 184 Hadley Co.,. Anderson v. inf. v. Standard Oil State ex 12, portions 674, of the Kansas 902, 270, P.2d aff. 224 339 116 S.W. 218 Mo. U.S. many respects ours, act, similar were Ann.Cas.1913D,, 56 L.Ed. S.Ct. 32 unconstitutional; certainly held case illegal case some acts In 936. defendants or intervenors “cutting aid to here. prices” no giving consisted merely apparently cited It because the 1025) cit. otherwise con (loe. rebates dairy industry opinion states that the had accomplishment prices in the trolling monopoly. completely any more This regulated general than maintenance been know, law, forbids industry. agreement,, as we facts in H. P. Hood DuMond, Sons, or combination restraint understanding 336 U.S. & Inc. competition here, (§ L.Ed. trade or 416.010) irrelevant S.Ct. opinion merely any product noted or sale right purchase that the or com and the any such regulate production modity; agreement it forbids the states or milk, “regulate, understanding control or fix” distribution of related intimately welfare, any commodity public thing; health and had been long Liquidators, discriminations between different recognized. In forbids ABC Inc. v. City, Missouri, Mo., in purchases communities Kansas localities or n (cid:127)sales, Goods,” and procedures and sale “Household “Milk enacts drastic and it act and Milk Products” law respects present as Ch. appearing many remedies. In “Food, long- Drugs 3 of 52 entitled Title duplication our particularised is a chapter That was first Cosmetics.” enacted law. general established aas health and measure in sanitation why all of the asserted I see reason and including thereafter amended to n purposes present might act not have present regulatory form. This accomplished rigid by a enforcement been conglomeration special general leg- n stands, law, either as it existing only islation again illustrates the confusion specific general amendments. If special and relative unfairness legisla- necessary in the “cost” factors were deemed provi- tion. The Tennessee constitutional they discretion, might legislative easily sions for “General providing Laws” (Art. Var- added amendment. 11, 8) are much less restrictive than ours. ious states have enacted “Unfair Practices” opinion my generally prohibiting our entire act (now Acts sales below §§ 506; 416.41CM-16.560) special Ann. invalid as legis- cost. 128 A.L.R. A.L.R. III, lation in processor would if contravention 1126. It seem of Article 40§ Mo.Constitution, (30) ab- Missouri sells to retailer at an 1945. I think many surdly plaintiff’s price, and latter on the low wholesale attacks act are highly absurdly technical price, resells it at an and of real retail at materiality. low period, a I do have much least over doubt of the continued would the validity of —there requirement ordinarily as to cost,” exist sales agreement some sort of less “for than applied any as to “in restraint of com- one individual understanding trade or item sold jointly by petition” processor a existing many law. are not items. The We n here, however, tenuous nature hypothetical requirement to decide a this is by shown (cid:127)case. the recitals of evidence in the majority opinion; it is by also shown the Report the we note that passing In explanations attempted both counsel and Legislative Committee states Special Joint in majority opinion to the effect that the complete price con- sought to avoid it only term means “average” “ap- cost or adopt remedy a is trol, “reluctant to proximate cost” or “reasonably cost con- deadly malady potentially n expressions strued.” These are perhaps as ” an¿ “jn ** state neighboring ambiguous as the original term, and none of committee found what of Tennessee explanations the various wholly seems satis- object quest. its appeared be factory. do not I rest my dissent on that « n n legislation of control ground, however. and investi- states was considered modify I would judgment act specify- the Tennessee was chosen gated, ing therein that the act as a upon proposed a whole is which to base uncon- model as a stitutional as in conflict with problems III, of our own state.” Article for solution (30) Mo.Constitution, the Tennessee Annotated search a In modified, as so I would affirm the chap- judgment. general find a Ed.) I (Official Statutes agreements, etc. to lessen prohibiting ter On Motion for Rehearing 1), competition (Title a “Fair Ch. free essentially Law,” right granting Trade prod- in brand-name prices resale DALTON, Judge. fix Law,” “Unfair 2), a general Sales (Ch. ucts primary view first and applying to the sale of all 3), merchan-

(Ch. cost,” respondent’s motion assignment for re “less than at retailers dise ques the effect that the Act in wholesalers, hearing to Cigarette an “Unfair Sales special gen law where a Chapter local or 4), con- tion a (Ch. 6), a new (Ch. Law” applicable, have been made could law “Unlawful Trade Practices” in the eral cerning apparent original opinion operate. it seems would special test a law adequately question did not appropriateness discuss is the provisions whether House Bill No. 255 a objects not, constituted to the that it excludes. It is special contrary provi- local or therefore, law what includes, a law makes sions of (30) special, subsection 40 of it Section but what it If noth excludes. Article III ing of the Constitution Missouri excluded that should be contained V.A.M.S., prohibits enact- general. the law is Within distinction any special ment of local or law where a between special a general and a law general applica- question law could have been made every case is whether judicial appropriate ble. The is a one object to which the excluded judicially law, regard determined without limitations, but for its apply. would any legislative subject. only If assertion on the limitation contained lawa legitimate objects classification of its it general is a Hence, object law. if the special passed “When a law is * law * * have characteristics so distinct as rea legislature necessarily deter sonably form, purpose legislated mines, instance, first general upon, a by itself, class general, the law is apply. law cannot be made de But their notwithstanding operates single is, termination is not final. There object only; a law is not be presumption course, public officers operates cause it upon every person in the discharged properly their duties state, every person but because that can be every legislature presumed act of the brought predicament within its becomes judicial be valid until there determina is a subject operation.’” to its (Italics ours.) contrary.” tion Anderson Board State ex inf. Barrett ex rel. Bradshaw v. County, of Cloud Com’rs 77 Kan. Hedrick, 402, 407; 294 Mo. 241 S.W. 587; City Springfield 95 P. Hancock, Budd v. 133, 135, 66 N 48 A. Smith, 1, 4; 19 S.W.2d .J.L. Mo. ABC 1023, 1024. Liquidators, City, Mo., Inc. v. Kansas Mo. Sup., 876, 885(15). 322 S.W.2d principle perhaps best illustrated determining In constitutionality of a City in the case of of Springfield Smith, provision statute under the constitutional supra, 19 1, 5(8); S.W.2d and McKaig v. question here we are dealing not with City, Kansas Mo. 256 S.W.2d the matter of classification of the subject 815. purpose matter of for the of de- termining whether the Act violates other city In the Smith pro- case ordinance provisions equal pro- constitutional such Sunday “only hibited on ‘open the keeping process, law or due any theatre, tection of the where the playhouse, any or other legislative whether the place test is classification performances, where theatrical vaud- upon some difference which rests bears moving picture eville shows or exhibitions just and relation to Act in given conducted,’ a reasonable are or conducting or respect pro- which the classification is taking part performance, such show question before posed. The us here is pointed exhibition.” This Court out that whether, purposes considering omitted from any pro- the ordinance was could have Act, a law been made against keeping open hibition “the op- applicable. public eration of such amusement business- concerts, circuses, es as parks, amusement " public halls, exhibitions, sparring special wrestling law is in a con ‘A exhibitions, public and like when, amusement sense force of an in stitutional * * businesses The Court said: arbitrarily separates limitation, it herent public “Each and all of things places amusement persons, others busi- some limitation, which, enumerated, for such nesses above it but omitted from selling all commodities and all merchandise ordinance, affect the operation words, except legisla- automobiles. In other permissible subject-matter of persons excludes all business way. engaged in the same very much the tion in sets, radios, phono- of selling re- television each open operation of keeping machines, graphs, activities, refrigerators, washing fur- each quires similar labor trailers, heaters, electric gas ranges public for a consideration nishes to the golf equipment, furniture, hardware, cloth- entertain- opportunity for excitement and * * * ing many There sufficiently ment, attractive articles. and each is is no at- reasonable out those public singling basis for large portions of induce people reasonably engaged who are tend, the business fairly and each shows,' selling those theaters, excluding automobiles and comparable vaudeville with people who arti- their sell the picture above enumerated moving exhibitions cles permitted We merchandise are possibilities day of rest. who disturbing open keep reg- places their on Sun- justify business find no reason would days and the also six named holidays.” (Italics will regard ulation in this of one ours.) 815, 817(7).] others. S.W.2d apply equal not force to the with [256 similarly They appear situated to be (30), Subsection III Section 40 of Article subject- permissible reference respects somewhat similar in certain ordi- sought matter to be dealt with Section 28 of Article I of the Constitution nance.” taking 1945 with reference to the private The Court further said: “We property there public use. It is determining much here so concerned with attempt stated that “when an take is made to to dis many private how threaten activities which be property alleged use subject-matter sought pro be public, turb the question whether the contem- might included in plated tected could or use public judicially shall be de- problem of piece legislation, one but our regard any legislative termined without instant concern is some have public.” whether declaration that the use omitted from the ordinance now involved City, Mo.Sup., case of Bowman v. Kansas clearly which it would be unreasonable involving the City arbitrary (Italics ours.) to omit.” private property of whether the taking of Smith, Springfield supra, of by city pub- v. S.W.2d the parking for off-street was a 1, 4, 5. purpose, judicial lic the determination was upon stipulated made this Court facts McKaig City, supra, In Kansas this upon judicial facts of which the Court took prohibit- Court city held that a ordinance City notice. In the case of of Kirkwood ing keeping automobile their from dealers Venable, 8, 11, 351 Mo. places open Sundays of business on pointed property was out that the owner of holidays six national was unconstitutional sought city park to be taken for a the “had “special oper- as a law” excluding from its right to the evi- demand that court hear the persons engaged ation all in of businesses dence and determine whether not the selling all other commodities and merchan- purpose proceeding of the was to condemn dise, except automobiles, any and without private public use use.” basis for such reasonable distinction. In case under consideration of this the pointing After out that “the laws * * * have been on the Sunday could heard prohibit state that work on here evidence general upon whether law could have public policy are based a sound which plaintiff the day applicable, but of recognizes that rest one in is for made seven been any to tending show that general the of mankind” the no evidence good Court fered unreasonably been industry had further said: “The before ex- ordinance us other the the Act. On persons arbitrarily in omitted from engaged cludes all the business of offer, and hand, the other the defendants did revocation also of licenses. The Act evidence, “Final the the authorizes the promulgate Court received in Commissioner to Report Milk regulations pur- on rules and carry of the the Committee out Joint witnesses, poses re- Act, Producers of the subpoena and Distributors’’ majority carry auditing quoted investigations ferred to and from employ opinion. presented firms in In the issue rec- examination determining of books evidence ords. is not limited to the Provision Court is made for claimants parties offer, complaints consider make see investigations fit and for knowledge matters of carried on common thereto. Section incident of provides the Act judicial doctrine of notice. for the issuance “stop oper- orders” enjoining of certain we believe question, Without ations without a license. Numerous detailed sale regulating provisions House Bill No. making are set out in the Act for Missouri, milk milk and effective, licensing Act particularly the classifica a sound special based law regulations, investigation complaints such, has industry, as tion, since the milk and the use injunctive processes legislation. special subject long been the compel courts to compliance. pur- subject-matter Further, considering pose appears Act also from the evi- sought to be the evils Act and present dence report contained the Committee have been corrected, that, could law investigation “Procedures for the in similar applicable, and no made alleged provided violations are and com- it was plainants omitted dustries are required post a bond omit. arbitrary to clearly unreasonable investigation which the if paid costs are complaint proves spurious. to be presented we issue determining . latter clause is discourage included mali- Act, provisions look to the must first cious false retaining accusations while It thirty-one sections. which consists public benefits of assistance in the enforce- comprehensive relating to Act a most ment of the subject act. Violators are held It was products. sale of and milk injunction, damages the assessment of treble entirety trial court to be void when injured others are and the revocation injunc- prohibited and its enforcement of their licenses products. to handle milk provisions tion certain because Also included bill sections de- constitu- to be violative of certain were held signed to applicable make the law to those sec- true that some provisions. It is tional selling milk in Missouri from without the overlap do more or less tions the Act state.” general criminal subject matter of certain n statutes State, which statutes thirty-one In view of all of n course industry equally apply to the can it provisions be said that businesses, however, in the Act with unreasonably industry has been similar n question not a criminal statute. The dis- arbitrarily Re excluded? The “Final and of- opinion refers to the broad terms senting Committee on Milk Pro port of the Joint dealing Chapter V.A.M.S. 416 RSMo Distributors,” offered in evi ducers and. Monopolies, Discriminations and Con- with defendants, pointed by out dence are criminal statutes. See spiracies, which twenty-seven and 1936 states “between 416.150, 416.130, 416.280 RSMo Secs. legislation.” adopted price milk control Un V.A.M.S. provision these many of acts was made der clearly definitely fixing price appears of the Act the purpose of milk. for twenty opinion points further last sections to the fact principal the of the system licensing up for statutes orders set manu- Federal are des where that under supplies prices dairy products help stabilize and processors and of ignated facturers provisions these milk; and that under orders fees are fixed made for fluid and of economy industry its minimum and others as far as sets Secretary Agriculture pay concerned? required prices handlers are dairymen Under areas. certain majority opinion,, As stated in the price effect, the

thirty-six orders now “respondent right State concedes each at milk fluid paid producers be regulate and production control thirty-six is determined locations regard distribution of milk with to sanita- or- These Department Agriculture. purity tion and and dis- not as to sales St. area, the ders include the St. Louis Jo- However, tribution practices.” and sales City area. seph greater Kansas area and the regulations purity as to sanitation and com- fácts only cognizant One need be quite important many types be as of other be- publicized to widely monly known and milk, food know they stuffs as are to but we econo- fact that the come familiar with the of no such uncon- having act been declared en- throughout my industry of the milk stitutional because act not cover did eccentric tire “so United States has become all other foods in need of sanitation at found been economic controls purity regulations. Hood (H. P. necessary once and difficult.” DuMond, 525, 69 S.Ct. & 336 U.S. Sons While House No. does not Bill 657, 661, be unnec- should 865.) 93 L.Ed. It price of specifically undertake to fix the sale com- essary to further refer matters paid milk to the nor consumer to be pro- knowledge mon with reference producer, apparent from its still it is use. milk, duction of distribution provisions licensing machinery and the beef, many other pork, While mutton system up set for the of its enforcement products may quite produced well be provisions supervision and for the Zealand, the Argentina, New Australia or industry purpose the essential reference same situation does not exist Act is the maintenance of local herds dairy produced by local dairies to fresh dairy throughout and the local industry and much throughout the State Missouri industry, protection State and the of such it community where locally in the of it used special because it is in a class. economic of com- matter produced. is further a It From the evidence parties offered dairy small herds knowledge that mon and from the of common knowledge facts being continually operators are dairy small cannot be said that in other similar move- out of business forced dustry has unreasonably or been arbitrarily industry ment toward centralization provisions omitted from the of the Act con industrial great under the control sidering subject matter force controlling concerns, which exert a sought thereby. the evils to be corrected when It clear that over wide areas. is also (30) Subsection of Section 40 Article dairy are once local herds dairies and local III, applied Constitution Missouri community particular from a eliminated cases, McKaig City Springfield in the unlikely to be re-established they are supra, application has the facts present industrial trends. view of this case. in the fully agree with the statement unnecessary to We review other as- It will that the Act is “directed opinion dissenting rehearing. motion signments industry.” economy of solely at the examined and found to They have substantially true of the statutes Respondent’s same motion for a merit. without many price fixing states overruled. rehearing the Federal orders products, WESTHUES, J., C. HOLLINGS- paid producers of fixing HYDE, concur; JJ., industry been Why has the milk WORTH fluid milk. LEEDY, JJ., EAGER, legislation STORCKMAN special out for singled the milk dissent. no difference between there if

Case Details

Case Name: Borden Company v. Thomason

Court Name: Supreme Court of Missouri

Date Published: Jan 8, 1962

Citation: 353 S.W.2d 735

Docket Number: 48736

Court Abbreviation: Mo.