Sierra Berdecía v. Borinquen Pasteurizer, Inc.

83 P.R. 525
CourtSupreme Court of Puerto Rico
DecidedSeptember 21, 1961
DocketNo. 12185
StatusPublished

This text of 83 P.R. 525 (Sierra Berdecía v. Borinquen Pasteurizer, Inc.) is published on Counsel Stack Legal Research, covering Supreme Court of Puerto Rico primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sierra Berdecía v. Borinquen Pasteurizer, Inc., 83 P.R. 525 (prsupreme 1961).

Opinion

Per curiam.

The claim for unpaid wages involved in this case covers the years 1951, 1952, and 1953. The question for decision [526]*526is whether, in accordance with the facts of this case, the work performed by the plaintiff laborers for the defendant is governed, as to the wage rate, by Mandatory Decree No. 5, relative to bottled soft drinks and beer, or by No. 16, relative to wholesale trade.

Decree No. 5, approved January 12, 1944, defines the regulated industry as follows:

“The Beer and Soft-drink Industry, or any one of them, comprises, but not by way of limitation, all the acts,' processes, operations or services that may be necessary, incidental or related to the preparation, production, distribution or disposition, by the manufacturer, of beer of any kind, with or without alcohol, or of any soft-drink prepared with carbonated water as a basis.”

A few years later, on August 24, 1949, the Minimum Wage Board issued Decree No. 16, fixing minimum wages and other working conditions for employees in the wholesale trade. The following definitions are set out in Art. I:

“A. Wholesale Trade embraces any establishment, enterprise or agency engaged in the sale of merchandise to retailers, commercial establishments or to other wholesalers. It includes wholesalers, agents, brokers, commission agents, and sales branches of manufacturing enterprises. It covers the processes of buying, selling, warehousing, transporting and any other activity connected therewith. It shall not include, however, establishments having two or less employees partially engaged in any of the processes listed in this definition. These establishments shall be subject to the provisions of the mandatory order applicable to the activity carried on jointly with wholesale trade. Neither does it embrace any subdivision of an establishment whose employees are totally engaged in retail trade.
“B. Sales Branch of a Manufacturing Enterprise shall mean a subsidiary establishment of a manufacturing enterprise which does not operate in the same building where the manufacturing processes are performed and which is engaged in the distribution at wholesale of goods produced by said manufacturing enterprise.”

[527]*527On September 14, 1950, the Department of Labor issued, an interpretative memorandum (No. 8) of Decree No. 16, setting forth therein the criterion of the department for determining what is meant by a branch of a manufacturing enterprise.

“We are of the opinion that, in order to determine whether or not there exists a ‘Sales Branch of a Manufacturing Enterprise’ (Art. 1-A, swpra), the place where the product is stored is not decisive, although it may be an important factor to be considered in doubtful cases. In our opinion, the controlling factor is the place and the manner in which the sales are transacted or the product distributed, for an industrialist may store his product in the same establishment where it is manufactured and set up a completely separate commercial establishment to carry out the wholesale transactions of the product. Or he may store it in other premises without having an organized ‘commercial establishment’ for the sale or distribution of the product. That it is necessary that there exist an organized ‘commercial establishment’ for the wholesale or distribution of the product, appears evidently from the explanation of its intention given by the Board in its Findings of Fact and Opinion, supra — the decree does not cover the manufacturing process ‘up to the point when [the industrialist] delivers his product to the dealer or entity which will sell the same.’ Since the ‘delivery’ of his product by the industrialist to the dealer who is to sell it necessarily entails the previous sale of the product in the regular course of business, Mandatory Decree No. 16 can not be applied to such sale. Hence, it is necessary to distinguish between the sales made by an industrialist to wholesalers or retailers in order to place his product in the market for consumption, which sales are not covered by the decree, and those which an industrialist may transact as merchant, that is, in a branch establishment of his manufacturing enterprise, the organization of which is different from that of the latter and which is devoted to the sale or distribution at wholesale of his product. The former are ‘industrial sales’ and the latter ‘commercial sales.’
“The easiest way of distinguishing between one class of sales and other classes consists in determining whether or not the sales are transacted in a commercial establishment, that is, in premises devoted to the sale or distribution of articles, which [528]*528means an establishment which is ordinarily or daily open to customers and purchasers to carry out sales transactions.” (See brief for defendant-appellee, p. 5.)

The complaint alleged, briefly, that the defendant was a domestic corporation engaged at the time of its filing, in the bottling, production, and wholesale of soft drinks, with principal offices and factory in Hato Rey, San Juan, Puerto Rico, and a sales branch in Ponce, and that the said branch was a subsidiary establishment of the manufacturing enterprise, organized in other premises and devoted to the wholesale of the soft drinks bottled in Hato Rey. That the laborers represented by the complainant worked there for the defendant; further, that those laborers were covered by Mandatory Decree No. 16 and that they failed to receive the amounts set out in the fourth allegation of the complaint, totaling $1,747.22.

The complaint alleged demand and lack of payment and prayed for judgment for the total sum of $3,494.44, that is, $1,747.22 as the difference in unpaid wages and an equal amount by way of penalty, to be apportioned among the claimant laborers, pursuant to § 25 of Act No. 8 of April 5, 1941 (Sess. Laws, p. 802), as amended by Act No. 451 of May 14, 1947 (Sess. Laws, p. 950).

The defendant admitted certain facts of the complaint, denying specifically that it had a sales branch and that it was engaged in the distribution and wholesale of soft drinks, and further denied that it owed any amount to the claimants.

The hearing of the complaint was held on October 5, 1956. At the start the parties stipulated that the question for decision was whether Mandatory Decree No. 16 or No. 5 was applicable; if the latter was applicable, then no amount was due the claimants; and that in order to determine which decree was applicable it was necessary to determine whether or not the warehouse which the defendant had in Ponce was a sales branch. It was also stipulated that the complainants [529]*529were employees of the defendant on the dates mentioned in the complaint (according to the complaint, the work was performed between January 26, 1951 and October 1, 1953) ; that the complainant made demand for payment to the defendant, and that the controversy was confined to determining whether or not the warehouse was a sales branch, whether the transactions were commercial or industrial, and whether Mandatory Decree No. 16 was applicable.

The oral testimony summed up by the trial court is as follows:

Fructuoso Flores Figueroa and Edelmiro Rosado, the latter in rebuttal, testified for the complainant.

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Bluebook (online)
83 P.R. 525, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sierra-berdecia-v-borinquen-pasteurizer-inc-prsupreme-1961.