U.S. Supreme Court HIGHLAND FARMS DAIRY V. AGNEW , 300 U.S. 608 (1937)

300 U.S. 608

HIGHLAND FARMS DAIRY, Inc., et al.v. AGNEW et al., Members of Milk Commission of Commonwealth of Virginia.No. 573.

Argued March 8, 9, 1937.Decided March 29, 1937.

Appeal from the District Court of the United States for the Eastern District of Virginia. [ Highland Farms Dairy v. Agnew 300 U.S. 608 (1937) ]

[Page 300 U.S. 608 , 613]

question. The commission sued distributors to enjoin them from selling milk at a price lower than the prescribed minimum, and the injunction was granted against the defendants' objection that the statute was invalid. Upon appeal to the Supreme Court of Appeals the judgment was affirmed. To escape the force of that decision the argument is made that the question of unlawful delegation was not considered or decided. But the contrary is plainly indicated both in the opinion of the court and in that of its dissenting members. The prevailing opinion summarizes the arguments against the act, and among them is this (163 Va. 957, at page 976, 179 S.E. 507, 514), that there is 'the delegation to the commission of the power to enact legislation which is both prohibitory and penal in character and which will be operative only in such milk areas as the commission may define.' The dissenting opinion says (163 Va. 957, at page 980, 179 S.E. 507, 516): 'The commission may order milk to be sold at one price in Staunton, at another in Harrisonburg, and may leave Woodstock to shift for itself.' These statements are too clear to leave room for misconstruction. A judgment by the highest court of a state as to the meaning and effect of its own Constitution is decisive and controlling everywhere.

2. The statute is not invalid in its present application by reason of a provision for the cancellation of the prices established for a market, if cancellation is requested by a majority of the producers and distributors in the area affected. [Footnote 1]

[Page 300 U.S. 608 , 615]

within the boundaries of a designated market area. The sections quoted in the margin point fairly to that conclusion. [Footnote 2] Highland land in Washington may sell to High in Virginia, and High may buy from Highland, at any price they please. not till the milk is resold in Virginia within a market area will the price minimum apply, and then only to the price to be charged on the resale. Cf. Wiloil Corp. v. Pennsylvania, 294 U.S. 169, 175, 360; Sonneborn Bros. v. Cureton, ; Baldwin v. G.A.F. Seelig, Inc., 294 U.S. 511, 101 A.L.R. 55. If there could be any doubt about this as a matter of construction, the doubt would be dispelled by the administrative practice and by the warning of the statute, expressed in section 14, that operations in interstate commerce shall not be deemed to be affected. So

[Page 300 U.S. 608 , 617]

refusal. Lehon v. Atlanta, 242 U.S. 53, 56; Smith v. Cahoon, 283 U.S. 553, 562, 585. He should apply and see what happens.

Other arguments against the act are implicit in the arguments already summarized and answered. Expansion of the answer will serve no useful purpose.

The decree is affirmed.

Mr. Justice VAN DEVANTER, Mr. Justice McREYNOLDS, Mr. Justice SUTHERLAND, and Mr. Justice BUTLER do not assent to so much of the opinion as attributes to the state a power to fix minimum and maximum prices to be charged in the sale of milk, their views on this question being reflected by what was said on their behalf oby Mr. Justice McREYNOLDS in Nebbia v. New York, 291 U.S. 502, 539-559, 516, 525, 89 A.L.R. 1469. In other respects they concur in the opinion. Footnotes

Footnote 1 The provision (section 3(i) reads as follows: 'The commission shall withdraw the exercise of its powers from any market upon written application of a majority of the producers (measured by volume) of milk produced and a majority of the distributors (measured by volume of milk distributed) in said market acting jointly.'

Footnote 2 Section 3, subd. j: 'The commission, after public hearing and investigation, may fix the prices to be paid producers and/or associations of producers by distributors in any market or markets, may fix the minimum and maximum wholesale and retail prices to be charged for milk in any market, and may also fix different prices for different grades of milk. In determining the reasonableness of prices to be paid or charged in any market or markets for any grade, quantity, or class of milk, the commission shall be guided by the cost of production and distribution, including compliance with all sanitary regulations in force in such market or markets, necessary operation, processing, storage and delivery charges, the prices of other foods, and the welfare of the general public.'

Section 3, subd. k: 'The commission may require all distributors in any market designated by the commission to be licensed by the commission for the purpose of carrying out the provisions of this act. The commission may decline to grant a license, or may suspend or revoke a license already granted upon due notice and after a hearing. The commission may classify licenses, and may issue licenses to distributors to process or store or sell milk to a particular city or village or to a particular market or markets within the Commonwealth.'

Section 1, par. 2: "Market' means any city, town or village of the Commonwealth, or two or more cities and/or towns and/or villages and surrounding territory designated by the commission as a natural marketing area.'

Footnote 3 The section reads as follows: 'No distributor in a market in which the provisions of this act are in effect shall buy milk from producers, or others, for sale within the Commonwealth, or sell or distribute milk within the Commonwealth, unless such distributor is duly licensed under the provisions of this act. It shall be unlawful for a distributor to buy milk from or sell milk to a distributor who is not licensed as required by this act. It shall be unlawful for any distributor to deal in, or handle milk if such distributor has reason to believe it has previously been dealt in, or handled, in violation of the terms and provisions of this act.'