Opinion
13748
January 9, 1934.
Before DENNIS, J., Kershaw, May, 1933. Affirmed.
Suit by the Jewel Tea Company, Inc., against the City of Camden. From a judgment in favor of plaintiff, defendant appeals.
The order of Judge Dennis is as follows:
This cause was referred to the Master of Kershaw County for the purpose of taking testimony and reporting the same to the Court, and comes on to be heard before me on his report.
Plaintiff, a foreign corporation, is engaged in retailing its merchandise by means of agents. It owns and operates offices and warehouses in the City of Charlotte, N.C.; its agent solicits orders in the City of Camden, mailing these orders in to the Charlotte, N.C., branch, whereupon the merchandise is wrapped in separate individual sealed packages, and for convenience are inclosed in large containers and shipped to Sumter, S.C. by railroad, consigned to Jewel Tea Company, Inc.; plaintiff being both the consignor and consignee. Upon the arrival of the goods at Sumter, plaintiff's agent receives and opens the large containers, in which they are for convenience shipped and removes there from the individual packages and delivers them unopened to the respective customers who have previously ordered the goods, taking them by means of a delivery car belonging to plaintiff from the City of Sumter direct to plaintiff's customers in the City of Camden. At the time of the taking of the orders none of the goods or merchandise so ordered are within the State of South Carolina. Plaintiff's agent is paid a salary, has no interest whatever in the goods or the delivery car or in the selling price of the goods. The selling price of the goods is collected from the respective purchasers at the time of delivery, and the money so collected is sent by the agent to plaintiff.
In August, 1932, plaintiff was required to pay the City of Camden the sum of $50.00 as license fee under the terms of an ordinance of said city entitled, "An ordinance to require the payment of licenses on business, occupations and professions in the City of Camden, South Carolina for the year May 1, 1932, to May 1, 1933," and providing, among other things, as follows: "The following sum or sums of money are required to be paid to the said clerk and treasurer for a license to carry on the business, calling, profession or occupation in whole or in part within the limits of the City of Camden, as in each case specifically appears," the specific section of said ordinance under which said license was required to be taken reading as follows: "Trucks hauling merchandise, in or out of the city, either in connection with or without fruit and green produce. Fifty ($50.00) Dollars." Plaintiff paid the license fee of $50.00 under protest, and within apt time brought its suit for the recovery thereof, alleging that in taking and receiving the orders for future delivery of its merchandise in the City of Camden, and in the transportation and delivery thereof thereafter to the City of Camden from the City of Charlotte, N.C., it is engaged in "interstate commerce," and that the imposition, levy and collection of said tax or license fee is unlawful and invalid, in that a burden is thereby imposed on said interstate commerce engaged in, and proposed to be engaged in, by plaintiff.
The cases of State v. Moorehead, 42 S.C. 211, 20 S.E., 544, 26 L.R.A., 585. 46 Am. St. Rep., 719; Alexander v. Greenville County, 49 S.C. 527, 27 S.E., 469; State v. Coop, 52 S.C. 508, 30 S.E., 609, 41 L.R.A., 501, and City of Laurens v. Elmore, 55 S.C. 477, 33 S.E., 560, 45 L.R.A., 249, seem to be practically direct in point and to dispose of this case in favor of plaintiff's contentions; but the defendant, City of Camden, contends that the interstate character of the shipments terminates when they reach Sumter, where the large containers are opened and the individual packages removed by the agent and delivered to the customers at Camden, and further contends that the delivery vehicle operating wholly within the State and between Sumter and Camden and in Camden is not engaged in interstate commerce; and, too, that the tax is against the vehicle and not against the commerce.
While these contentions have been ably presented by defendant's counsel, I cannot agree that the interstate character of the commerce ended until the goods were delivered to the customers at Camden. The transaction in each instance is not complete until this has been done. Interstate commerce has been defined to be "a term of the largest import. It comprehends intercourse for the purposes of trade in any and all its forms, including the transportation, purchase, sale, and exchange of commodities, between the citizens of our country and the citizens or subjects of other countries, and between the citizens of different states. The power to regulate it embraces all the instruments by which such commerce may be conducted." Welton v. Missouri, 91 U.S. 275, 23 L.Ed., 347.
"Statutes and ordinances are unconstitutional, or at least inoperative, when they attempt to impose a tax on canvassers, solicitors, traveling salesmen, or other agents soliciting orders for non-resident principals, the goods being without the State at the time of sale and the contract of sale being accepted or approved in the State of the principal. Provided the goods are not in the State at the time of sale the manner of delivery is unimportant, the transaction being as much interstate in character when the goods are shipped by the manufacturer either to the selling or delivery agent and by him delivered to the purchaser as where the goods are shipped direct to the purchaser." 12 Corpus Juris, 107.
This is entirely supported by the case of Caldwell v. North Carolina, 187 U.S., page 622, 23 S.Ct., 229, 47 L.Ed., 336, in which case a portrait company shipped its goods from itself in Chicago, consigned to itself at Greensboro, N.C., where its agent received them, broke the bulk, and delivered the individual articles to the respective purchasers. The Court held in this case that it made no difference whether such articles were sent by mail direct to the purchaser or whether they were sent to the agent to deliver. See, also, Crenshaw v. Arkansas, 227 U.S. 389, 33 S.Ct., L.Ed., 565 Rogers v. Arkansas, 227 U.S. 401, 33 S.Ct., 298, 57 L.Ed., 569; Kirmeyer v. Kansas, 235 U.S. 568, 35 S.Ct., 419, 59 L.Ed., 721.
"Once the character as interstate attaches to a movement it continues until it reaches the point where the parties originally intended it should end." Illinois Central Railroad Company v. Fuentes, 236 U.S. 157, 35 S.C. 275, 59 L.Ed., 517; Western Union Telegraph Company v. Foster, 247 U.S. 105, 38 S.Ct., 438, 62 L.Ed., 1006, 1 A.L.R., 1278; Binderup v. Pathe Exchange, 263 U.S. 291, 44 S.Ct., 96, 68 L.Ed., 308.
"The question of continuity of transit which will exempt property moving in interstate commerce from local taxation is to be determined by the various factors in the situation, among which are the intention of the owner, the control he retains to change destination, the agency by which the transit is effected, and the occasion or purpose of the interruption during which the tax is sought to be levied. If the interruptions are only to promote the safe or convenient transit, then the continuity of the interstate trip is not broken." Champlain Realty Company v. Brattleboro, 260 U.S. 366, 43 S.Ct., 146, 67 L.Ed., 309, 25 A.L.R., 1195.
I think it clear that the taxing of any agency or instrumentality used in interstate commerce, no matter where it may operate, constitutes a tax on the commerce. "The power of Congress to regulate interstate commerce extends to all agencies and instrumentalities by which such commerce is carried on." 12 Corpus Juris (Commerce), 38.
"A train operating wholly within a state but carrying interstate traffic is an instrumentality of interstate commerce." 12 Corpus Juris (Commerce), 38.
"It seems clear that the mere fact that articles are carried in private conveyances does not prevent the transaction becoming interstate commerce." 10 A.L.R., 512, note.
For the reasons and under the decisions as above outlined and set forth, I am compelled to hold that the ordinance in question, in so far as it attempts to tax or license plaintiff's agencies or instrumentalities engaged in the commerce as herein indicated, is invalid, and it is therefore ordered and adjudged that plaintiff have judgment against the defendant, the City of Camden, in the sum of $50.00, together with the costs of this action.
Mr. L.A. Wittkowsky, for appellant, cites: As to intrastate shipment: 55 F.2d 347; 187 U.S. 622; 233 U.S. 334; 5 R.C.L., 713; 204 U.S. 403; 51 L.Ed., 540; 244 U.S. 346; 61 L.Ed., 1181; 260 U.S. 166; 12 F.2d 541; 29 L.R.A. (N.S.), 745; 38 S.C. 365; 37 A.S.R., 767; 17 S.E., 147; 122 Ga. 365; 50 S.E., 132; 61 A., 695. Reasonable ordinance: 48 S.C. 570; 125 S.C. 530.
Mr. Murdoch M. Johnson, for respondent, cites: Interstate shipment: 12 C.J., 38; 12 C.J., 107; 120 U.S. 489; 187 U.S. 622; 227 U.S. 389; 227 U.S. 401. Interstate commerce cannot be taxed by state: 236 U.S. 568; 227 U.S. 401; 91 U.S. 275; 55 S.C. 477; 33 S.E., 560; 52 S.C. 508; 30 S.E., 609; 42 S.C. 211; 20 S.E., 544; 49 S.C. 527; 27 S.E., 469; 153 U.S. 289; 14 S.Ct., 829; 236 U.S. 157; 59 L.Ed., 517; 247 U.S. 105; 62 L.Ed., 1006; 1 A.L.R., 1278; 263 U.S. 291; 44 S.Ct., 96; 68 L.Ed., 308.
January 9, 1934. The opinion of the Court was delivered by
For the reasons stated by his Honor, Judge Dennis, in his decree, which will be reported, the judgment of the Circuit Court is affirmed.
MR. CHIEF JUSTICE BLEASE and MESSRS. JUSTICES CARTER and BONHAM concur.