66 A.2d 295 | Pa. | 1949
Plaintiffs are milk dealers, within section 103 of the Milk Control Law approved April 28, 1937, P. L. 417,
The school district, by resolution of November 29, 1947, provided for the levy and collection of mercantile taxes for the fiscal year 1948 pursuant to the Act of June 20, 1947, P. L. 745,
The first section, entitled "Definitions," contains the following provision of importance in this case: " 'Dealer in, or vendor of goods, wares and merchandise' shall not include any mechanic who keeps a store or warehouse at his place of manufactory or workshop in which he sells only his own manufactures, any person vending or disposing of articles of his own growth, produce or manufacture, or any hawker or peddler licensed under any law of this Commonwealth."
The court below held that plaintiff milk dealers are manufacturers of sixteen milk products and still drinks named in the third finding of fact as follows: Ice Cream and Frozen Specialties, Cottage Cheese, Butter, Skimmed Milk Powder, Condensed Skimmed Milk, Evaporated Milk, Orange and other Flavored Drinks, Pasteurized Cultured Buttermilk, Pasteurized Sour Cream, *16 Pasteurized Cream, Pasteurized Homogenized Cream, Pasteurized Chocolate Milk, Pasteurized Homogenized Milk, Pasteurized Homogenized Vitamin D. Milk, Pasteurized Milk, Pasteurized Skimmed Milk and Plain and Sweetened Condensed Milk. Having concluded that plaintiffs were manufacturers the court held that they were within the class excepted by the legislature from those whom the school district could tax.
In their brief, the plaintiffs refer to the fact that, in holding that they were engaged in manufacturing, the court dealt with only one of the three important words "growth, produce or manufacture" employed by the legislature in defining "dealer"; plaintiffs then make the further contention that they sell their "own . . . produce . . ." On the other hand, the argument for the school district was to the effect that the plaintiffs were mere dealers not engaged in selling their own "produce" nor engaged in "manufacture."
Counsel for the school district of Philadelphia (the only other first class school district in the Commonwealth) participated, amicus curiæ, in the argument and stated frankly that he regarded three of the seventeen products as manufactured products and therefore properly subject to the injunction granted; these three products are ice cream and frozen specialties, cottage cheese and butter; all the rest, he contended, were milk which plaintiffs purchased to sell again after subjecting it to incidental processes not constituting manufacture as understood in the Mercantile License Tax Act of 1947.
The three-fold classification into articles grown, produced, or manufactured has been in our mercantile tax statutes for more than a hundred years, and has frequently been the subject of judicial consideration: In re Mercantile License Tax ofPittsburgh Coal Co.,
"The learned counsel for the plaintiffs argue that 'growth' includes the process, which takes place in milk when harmless bacteria of various kind, called cultures, are added to the milk to hasten what would otherwise take place through lapse of time. It does not seem to us that developments of this character such as for example would result from leaven or yeast being mixed with the meal means 'growth' as understood in this taxing act. This is merely a change of the chemical composition.
"It does not seem to us that either 'growth' or 'produce' as used in this Act in any way qualify or enlarge the last word, to wit, 'manufacture,' and that each one of these categories stands alone. If we are right in this conclusion, then our consideration for the remainder of the discussion may be confined to the meaning of the word 'manufacture.'" We agree with that conclusion as to the words "growth" and "produce."
We then come to the word "manufacture" as used in the statute. The definition of manufacturing given by *18
BLACK, J., in Norris Brothers v. Commonwealth,
The word "manufacture" is to be taken as used by the legislature in its ordinary and general sense: compare Com. v.Wark Co.,
In Commonwealth v. Consolidated Dressed Beef Company,
Com. v. Lowry-Rodgers Co.,
Other instances of classifying parties as dealers subject to the tax, or as manufacturers exempt from the tax, might be referred to at length but shall be noted briefly. In the following cases exemption as manufacturer was disallowed:Com. v. Sunbeam Water Co.,
While it may be difficult from these decisions to state a definition that will in all cases readily determine whether a party should be classed as a dealer, i.e., one who buys to sell, or as a manufacturer, i.e., one who makes a new product, we have no difficulty in classifying plaintiffs as dealers who buy milk, bought for the purpose of selling it as milk after subjecting it to various processes, and also in classifying them as manufacturers, making ice cream, cottage cheese or butter. While these articles are made from milk, they are "a new and different article" from the milk originally purchased, within the principal controlling decisions cited above. With respect to ice cream, the court below referred to the Ice Cream Regulatory Act of 1933,1 in which ice cream is treated by the legislature as a manufactured product, but a like inference with respect to milk generally cannot be made from the Milk Control Act of 1935,2 because the phraseology of that Act deals with both processor and manufacturer.
It would unnecessarily lengthen this opinion to deal seriatim with each of the remaining fourteen products in the sale of which the plaintiffs are dealers and not manufacturers. All the evidence was produced by the plaintiffs; the defendants produced none. The chancellor made no findings of fact with respect to the processes applied to produce these fourteen products which plaintiffs sold. As the evidence came from them and is not contradicted by evidence offered by defendants, we shall deal with it as if the chancellor had made specific findings in accord with plaintiffs' evidence. We shall refer briefly to a few of them. A city ordinance of Pittsburgh requires pasteurization. Pasteurized milk *23
was described at some length by two witnesses. Pasteurization involves heating milk to a certain temperature and holding it at that temperature for a specified length of time for the purpose of destroying disease producing organisms. The process results in changes in its protein and mineral content. The mere fact that plaintiffs do this on a large scale with expensive machinery does not make it any the less processing milk. InCity of Louisville v. Ewing Von-Allmen Dairy Co.,
In a supplemental brief, the plaintiffs refer toWisconsin Electric Power Co. v. U.S.,
Decree reversed in part; record remitted with instructions to enter a decree not inconsistent with this opinion, costs to be equally divided between the plaintiffs on the one side and the defendant school district on the other.