Opinion
1 Div. 373.
June 29, 1940. Rehearing Denied August 9, 1940. Reversed on Mandate December 17, 1940.
Appeal from Circuit Court, Mobile County; J. Blocker Thornton, Judge.
Action to recover license or privilege tax by the State of Alabama against Thomas F. Stein, Jr., doing business under the name and style of Stein Brokerage Company. From a judgment for defendant, plaintiff appeals.
Affirmed.
Certiorari granted by Supreme Court in State v. Stein, 199 So. 13.
The agreed statement of facts — omitting the exhibits — is as follows:
Thomas F. Stein, Jr., does business under the name and style of Stein Brokerage Company, and is hereinafter referred to as defendant. The defendant is engaged in business at 57 St. Francis Street, in the City of Mobile, Alabama, a city of over 50,000 population, renting the premises where he does business. The defendant has been engaged in business at the above address since October, 1937. On the front of the above-described premises there appears a sign designating the occupant thereof as "Stein Brokerage Company, Merchandise Brokers."
Defendant is engaged in business negotiating contracts for the purchase of staple groceries, canned goods and a general line of foodstuff between purchasers in the City of Mobile, Alabama, and sellers, hereinafter referred to as principals, located without the State of Alabama, as more fully appears from examples set out hereinafter.
The defendant holds himself open as negotiating contracts only with bona fide wholesale grocers, and the principals so represented by him. The defendant represents definite and certain principals and a list of those principals, together with the product which they manufacture or process, is hereinafter set out.
The defendant does not hold himself open as willing to represent any principals unconditionally, but will only represent such principals as are satisfactory to him, and as a matter of fact constantly refuses to represent new principals.
Any order for merchandise secured by the defendant is subject to approval by the principal. The orders secured by defendant are secured without the use of samples, except when samples are demanded by customer.
The remuneration received by defendant for his services is a commission based on the sale price, which is paid to him by the principal and remitted during the month after the sale and shipment of the merchandise was made. The defendant receives no remuneration other than these commissions.
If defendant procures an order or orders for less than a carload lot of a commodity, on which the freight rate would be lessened by the shipment of a carload lot, the defendant will send in an order for a carload shipment of the particular commodity and the carload will be shipped to the particular jobber who has the largest portion of such car, or to the defendant. The defendant attempts to dispose of the unsold portion of the carload prior to the arrival of the shipment, and in the majority of cases is able to do so. If an order is not procured for the unsold portion of the merchandise by the defendant prior to its arrival, it will be stored by him and subsequently sold.
In all cases the merchandise ordered is shipped from the plant of the principal to the purchaser.
Defendant procures from persons, firms or corporations, located in Mobile County, Alabama, orders for the merchandise manufactured and distributed by its principals, a list of said principals, together with the merchandise manufactured or distributed by them and the location of their plant, being hereto attached, marked "Exhibit X", and made a part hereof. The orders so secured are directed to these principals and are forwarded by the defendant to such principals. If the order is accepted, the principal will then ship the merchandise so ordered directly to the purchaser and bill the purchaser therefor. The defendant is paid a commission on all orders accepted by the principals, and as a general rule is paid such commission during the month following the sale and shipment. The following is an example of the nature of the business engaged in by the defendant.
Heretofore defendant called on Burke Distributing Company, a corporation, doing a wholesale grocery business in the City of Mobile, Alabama, and secured an order from it for canned vegetable soup. A copy of said order is hereto attached, marked "Exhibit A", and by reference made a part hereof as though the same were set out herein. This order was then sent directly to Kitchen Art Food, Inc., a principal, located in the City of Chicago, Illinois. The said canned soups so ordered were then shipped directly to said Burke Distributing Company, and an invoice was sent to said Burke Distributing Company, a copy of which invoice is hereto attached, marked "Exhibit B", and by reference made a part hereof as though the same were set out herein. For these services defendant was paid a commission by said Kitchen Art Food, Inc. The amount of the commission was ascertained and remitted at the end of the month following the sale and shipment, along with the other commissions due defendant for other sales made by it for said principal during said month. Defendant receives no fixed salary from Kitchen Art Food, Inc., nor is he paid any remuneration other than the commission earned by him for sales made for said principal.
That the defendant is engaged in business in Mobile County, Alabama, and that if he is subject to the license claimed in the complaint, he is liable for a license for the years beginning October 1, 1937, and October 1, 1938, at the rate of $75 per year with interest; and that if he is subject to the license claimed in the complaint, he is liable for a penalty of $11.25 as to each of the years above mentioned; and that if he is subject to the license claimed in the complaint, he is liable for the additional sum of $3 due from him for citation fees claimed in count six of the complaint; and that if he is subject to the license claimed in the complaint, he is liable for an additional sum of $1 for the issuance of the license in question.
Thos. S. Lawson, Atty. Gen., and John W. Lapsley and J. Edw. Thornton, Asst. Attys. Gen., for appellant.
One engaged in business negotiating contracts for the sale and purchase of commodities is a commission merchant or merchandise broker. Revenue Code 1935, § 348, schedule 29, Gen.Acts 1935, pp. 256, 450; Stratford v. Montgomery, 110 Ala. 619, 20 So. 127; Portsmouth C. O. Co. v. Madrid C. O. Co., 195 Ala. 256, 71 So. 111; Perkins v. State, 50 Ala. 154; 12 C.J.S., Brokers, pages 5, 9, §§ 1, 4; 8 Am.Jur. 989, § 2. Non-discriminatory licenses imposed in buyer's state are not inconsistent with the congressional power to regulate commerce among the several states. Hinson v. Lott, 8 Wall. 148, 19 L.Ed. 387; Western Live Stock v. Bureau of Revenue, 303 U.S. 250, 58 S.Ct. 546, 82 L.Ed. 823, 115 A.L.R. 944; McGoldrick v. Berwind-White C. M. Co., 309 U.S. 33, 60 S.Ct. 388, 84 L.Ed. 565, 128 A.L.R. 876; Graybar Elec. Co. v. Curry, 238 Ala. 116, 189 So. 186; Curry v. Feld, 238 Ala. 255, 190 So. 88. Any shipment of goods from one state to another without there being a consignor without the state and a consignee within the state at the time of shipment is not interstate commerce. Woodruff v. Parham, 8 Wall. 123, 19 L.Ed. 382; Hinson v. Lott, supra; Wagner v. Covington, 251 U.S. 95, 40 S.Ct. 93, 64 L.Ed. 157, 168; See: Howe Mach. Co. v. Gage, 100 U.S. 676, 25 L.Ed. 754; Emert v. Mo., 156 U.S. 296, 15 S.Ct. 367, 39 L.Ed. 430. General statutes should not be construed in such a way as to render them unconstitutional. Lee v. Cunningham, 234 Ala. 639, 176 So. 477; Clark v. State, 4 Ala. App. 202, 59 So. 236; Ex parte State, 180 Ala. 529, 61 So. 901; Singer S. M. Co. v. Brickell, 233 U.S. 304, 34 S.Ct. 493, 58 L.Ed. 974, 975; Kehrer v. Stewart, 197 U.S. 60, 25 S.Ct. 403, 49 L.Ed. 663; Raley Bros. v. Richardson, 264 U.S. 157, 44 S.Ct. 256, 68 L.Ed. 615; Armour Pkg. Co. v. Lacy, 200 U.S. 226, 26 S.Ct. 232, 50 L.Ed. 451.
Marion R. Vickers, of Mobile, for appellee.
Appellee was not engaged in business as a commission merchant or merchandise broker and is not, therefore, liable for the license levied by § 348, schedule 29, of the Revenue Code of 1935 (Gen.Acts 1935, pp. 256, 450). Stratford v. Montgomery, 110 Ala. 619, 20 So. 127. The exaction of a license under the above statute would be in violation of Article 1, section 8 of the Constitution of the United States which, in effect, prohibits the various states from interfering with interstate commerce. Stratford v. Montgomery, supra; Robbins v. Taxing District, 120 U.S. 489, 502, 7 S.Ct. 592, 30 L.Ed. 694; Stockard v. Morgan, 185 U.S. 27, 22 S.Ct. 576, 46 L.Ed. 785; Brown v. Md., 12 Wheat. 419, 6 L.Ed. 678. Appellee is engaged exclusively in interstate commerce, but even if engaged in both inter- and intrastate commerce no liability for the license required by the above statute is incurred, because the license is indiscriminately levied on the business and is not levied solely on the intrastate business. Leloup v. Port of Mobile, 127 U.S. 640, 8 S.Ct. 1380, 32 L.Ed. 311; Williams v. Talladega, 226 U.S. 404, 33 S.Ct. 116, 57 L.Ed. 275; Pennsylvania R. Co. v. Clark Bros. Coal Co., 238 U.S. 456, 35 S.Ct. 896, 59 L.Ed. 1406.
Simultaneously with the submission of the appeal in this, there was also submitted the appeal in the case of State of Alabama v. W. M. Meador, 198 So. 163, from the Mobile Circuit Court. This latter case has had the consideration of this court, and the opinion and judgment of the court was handed down and promulgated on June 25, 1940, the result being a reversal of the judgment of the lower court from which the appeal was taken.
Ante, p. 450.
The propositions of law and insistences in support thereof in the two cases are similar; but as the facts appear there is a marked difference, in that, it affirmatively appears in this case, from the agreed facts incorporated in the bill of exceptions and upon which the case was tried, the appellee here was not engaged in business as a commission merchant or merchandise broker, and is therefore not liable for the license levied by Section 348, Schedule 29, of the Revenue Code of 1935, General Acts 1935, page 256, and 450. To the contrary, this court concludes from said agreed facts that this appellee is engaged exclusively in interstate commerce only, and the exaction of a license under the above section would be in direct violation of Article 1, Section 8, clause 3 of the Constitution of the United States, which prohibits the various states from interfering with interstate commerce.
Having ascertained the foregoing, we deem it unnecessary to prolong this opinion, as no good purpose could be served by so doing.
The decisions of the Supreme Court of the United States; and of the several State Appellate Courts are replete; and are conclusive as to the correctness as to what has been here said. See, however, Stratford v. City Council of Montgomery, 110 Ala. 619, 20 So. 127; Robbins v. Shelby County Taxing Dist., 120 U.S. 489, 502, 7 S.Ct. 592, 30 L.Ed. 694; Stockard et al. v. Morgan et al., 185 U.S. 27, 22 S.Ct. 576, 46 L.Ed. 785; Brown v. Maryland, 12 Wheat. 419, 444, 6 L.Ed. 678.
The court reporter will set out in full the agreed statement of facts upon which this case was tried and determined.
Let the judgment of the trial court from which this appeal was taken stand affirmed.
Affirmed.
Reversed and remanded under provisions of Code, § 7318. State v. Stein, 199 So. 13.