Holcomb, J. —
The state and its director of agriculture brought this suit, setting up two causes of action against the defendant, which was engaged in the purely intrastate activities of warehousing, conditioning and'buying and selling fruit.
After disposing of preliminary motions, the issues presented by the complaint were challenged by a demurrer. The trial court sustained the demurrer as to the second cause of action and overruled it as to the first. Each party declined to plead further, and a decree followed, the mandatory provisions of which we quote:
“It Is Hereby Ordered, Adjudged and Decreed that the defendant Matson Company, a corporation, be and it is hereby fully and in all respects restrained and enjoined from engaging in the business of handling, wholesaling and dealing in deciduous tree fruits as defined in the 1935 act and marketing agreement, rules and regulations therein adopted without first fully complying with said act and the marketing agreement, rules and regulations adopted by said act and particularly is enjoined and restrained from transacting any of such business without collecting and paying
in to the director of agriculture the assessments provided for therein.
“It Is Further Ordered, Adjudged and Decreed that plaintiffs’ second cause of action be and the same is hereby dismissed with prejudice.
“It Is Further Ordered, Adjudged and Decreed that the accounting prayed for in plaintiffs’ first cause of action shall be had and in the event the defendant does not make such accounting, then in that event the plaintiffs may bring an additional action to secure such an accounting, and this action shall not be considered a bar to any such action.”
Plaintiffs appealed from that part of the decree which dismisses the second cause of action, and defendant has cross-appealed from that portion of the decree which grants relief as against it on the first cause of action. For brevity, they will be mentioned herein as appellants and respondents.
The second cause of action is based upon the agricultural adjustment act of 1933, which was held to be unconstitutional by this court in
Uhden v. Green-ough,
181 Wash. 412, 43 P. (2d) 983, and
Griffiths v. Robinson,
181 Wash. 438, 43 P. (2d) 977, and upon the marketing agreement and the orders promulgated by the director of agriculture thereunder.
The facts are pleaded in great detail, but it is unnecessary to make an extended statement here, further than to say that sufficient is pleaded to present the basic question of the right of the state to now collect from respondent the moneys which it deducted and retained from the growers with whom it dealt before the law was declared unconstitutional, to coyer the assessments provided for by the marketing agreement and orders made before the adverse decisions mentioned.
Respondent was licensed as a dealer and agreed to comply with the marketing agreement rules and regu
lations. It retained and now has in its possession a substantial sum of money which it deducted or retained from what was due from it to the growers, by virtue of the agricultural adjustment act and the marketing agreement, rules and regulations adopted thereunder.
Appellants assert that respondent should deduct that money as the agent of the state, and that the money now belongs to the state and does not belong to the growers from whom it was unlawfully withheld.
Appellants contend that one who acts for the state in collecting a tax may not, when called upon to account, assert the invalidity of the law under which the collection was made; and that, having taken advantage of the act and' obtained the money by virtue thereof, he may not unjustly enrich himself by asserting that the law was unconstitutional and void; citing
Spencer v. Consumers’ Oil Co.,
115 Conn. 554, 162 Atl. 23;
Shipe v. Consumers’ Service Co.,
28 Fed. (2d) 53, and other cases along the same line.
In all of these cases, the tax was clearly levied upon the consumer, or upon the product to be consumed, and the dealer was but the agent to collect the tax for the use and benefit of the taxing power. The rule is a sound one when so applied, but here we have no tax for the support of the government, but only an assessment for the benefit of the fruit industry; and moreover, we think upon the face of the orders made by the director of agriculture, upon which the cause of action is based, the assessment in question was levied upon the dealer and no one else.
Article V of order 128 is entitled “Assessments” and is the controlling order upon this question. Section (a) of that article provides that all dealers shall be licensed. Sections (b) and (c) read:
“(b) For the purpose of administering this order and.for the establishment of a fund for advertising purposes, the Executive Board, with the approval of the Director, shall levy an assessment of such an amount per packed box, or equivalent on fruit packed in other containers or sold loose, as shall be necessary.
■ “(c) The first dealer who handles or purchases the fruit from the grower or owner shall pay this assessment to the Executive Board in accordance with such regulations, and at such time and place as the Board may designate, and may deduct the amount paid from any monies due the grower or owner, or add such amount to the handling charge, expense, or advances incident to the handling of the fruit; Provided, the grower or original owner shall pay the assessment on all fruit sold by him directly or through a handler outside the state of Washington.”
It is unnecessary to construe the language or in-tendment of these orders made under the 1933 law. They were all made under an unvalid law", and as said in the
Uhden
and
Griffiths
cases, supra, were mere unlawful and arbitrary edicts. They, each and all, became
functus officio
with the death of that act. See
Drum v. University Place Water
District, 144 Wash. 585, 258 Pac. 505, and cases cited. That is
stare decisis
here.
The demurrer was properly sustained to the second cause of action, and the judgment dismissing it is affirmed.
The cross-appeal of respondent challenges the judgment entered on the first cause of action.
Chapter 78, Laws of 1935, p. 170, is a new piece of legislation designed, apparently, to supersede and take the place of chapter 12 of the Laws of 1933, Ex. Ses., p. 26, Bern. 1934 Sup., § 3035-1 [P. C. § 77-11]
et seq.
It is more comprehensive than the earlier act, but, speaking generally, it does not
appear to meet the objections that were sustained by the court to the former act in the
Widen
and
Griffiths
cases,
supra,
but, on the other hand, is a more complete abdication of the legislative power than the 1933 act.
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Holcomb, J. —
The state and its director of agriculture brought this suit, setting up two causes of action against the defendant, which was engaged in the purely intrastate activities of warehousing, conditioning and'buying and selling fruit.
After disposing of preliminary motions, the issues presented by the complaint were challenged by a demurrer. The trial court sustained the demurrer as to the second cause of action and overruled it as to the first. Each party declined to plead further, and a decree followed, the mandatory provisions of which we quote:
“It Is Hereby Ordered, Adjudged and Decreed that the defendant Matson Company, a corporation, be and it is hereby fully and in all respects restrained and enjoined from engaging in the business of handling, wholesaling and dealing in deciduous tree fruits as defined in the 1935 act and marketing agreement, rules and regulations therein adopted without first fully complying with said act and the marketing agreement, rules and regulations adopted by said act and particularly is enjoined and restrained from transacting any of such business without collecting and paying
in to the director of agriculture the assessments provided for therein.
“It Is Further Ordered, Adjudged and Decreed that plaintiffs’ second cause of action be and the same is hereby dismissed with prejudice.
“It Is Further Ordered, Adjudged and Decreed that the accounting prayed for in plaintiffs’ first cause of action shall be had and in the event the defendant does not make such accounting, then in that event the plaintiffs may bring an additional action to secure such an accounting, and this action shall not be considered a bar to any such action.”
Plaintiffs appealed from that part of the decree which dismisses the second cause of action, and defendant has cross-appealed from that portion of the decree which grants relief as against it on the first cause of action. For brevity, they will be mentioned herein as appellants and respondents.
The second cause of action is based upon the agricultural adjustment act of 1933, which was held to be unconstitutional by this court in
Uhden v. Green-ough,
181 Wash. 412, 43 P. (2d) 983, and
Griffiths v. Robinson,
181 Wash. 438, 43 P. (2d) 977, and upon the marketing agreement and the orders promulgated by the director of agriculture thereunder.
The facts are pleaded in great detail, but it is unnecessary to make an extended statement here, further than to say that sufficient is pleaded to present the basic question of the right of the state to now collect from respondent the moneys which it deducted and retained from the growers with whom it dealt before the law was declared unconstitutional, to coyer the assessments provided for by the marketing agreement and orders made before the adverse decisions mentioned.
Respondent was licensed as a dealer and agreed to comply with the marketing agreement rules and regu
lations. It retained and now has in its possession a substantial sum of money which it deducted or retained from what was due from it to the growers, by virtue of the agricultural adjustment act and the marketing agreement, rules and regulations adopted thereunder.
Appellants assert that respondent should deduct that money as the agent of the state, and that the money now belongs to the state and does not belong to the growers from whom it was unlawfully withheld.
Appellants contend that one who acts for the state in collecting a tax may not, when called upon to account, assert the invalidity of the law under which the collection was made; and that, having taken advantage of the act and' obtained the money by virtue thereof, he may not unjustly enrich himself by asserting that the law was unconstitutional and void; citing
Spencer v. Consumers’ Oil Co.,
115 Conn. 554, 162 Atl. 23;
Shipe v. Consumers’ Service Co.,
28 Fed. (2d) 53, and other cases along the same line.
In all of these cases, the tax was clearly levied upon the consumer, or upon the product to be consumed, and the dealer was but the agent to collect the tax for the use and benefit of the taxing power. The rule is a sound one when so applied, but here we have no tax for the support of the government, but only an assessment for the benefit of the fruit industry; and moreover, we think upon the face of the orders made by the director of agriculture, upon which the cause of action is based, the assessment in question was levied upon the dealer and no one else.
Article V of order 128 is entitled “Assessments” and is the controlling order upon this question. Section (a) of that article provides that all dealers shall be licensed. Sections (b) and (c) read:
“(b) For the purpose of administering this order and.for the establishment of a fund for advertising purposes, the Executive Board, with the approval of the Director, shall levy an assessment of such an amount per packed box, or equivalent on fruit packed in other containers or sold loose, as shall be necessary.
■ “(c) The first dealer who handles or purchases the fruit from the grower or owner shall pay this assessment to the Executive Board in accordance with such regulations, and at such time and place as the Board may designate, and may deduct the amount paid from any monies due the grower or owner, or add such amount to the handling charge, expense, or advances incident to the handling of the fruit; Provided, the grower or original owner shall pay the assessment on all fruit sold by him directly or through a handler outside the state of Washington.”
It is unnecessary to construe the language or in-tendment of these orders made under the 1933 law. They were all made under an unvalid law", and as said in the
Uhden
and
Griffiths
cases, supra, were mere unlawful and arbitrary edicts. They, each and all, became
functus officio
with the death of that act. See
Drum v. University Place Water
District, 144 Wash. 585, 258 Pac. 505, and cases cited. That is
stare decisis
here.
The demurrer was properly sustained to the second cause of action, and the judgment dismissing it is affirmed.
The cross-appeal of respondent challenges the judgment entered on the first cause of action.
Chapter 78, Laws of 1935, p. 170, is a new piece of legislation designed, apparently, to supersede and take the place of chapter 12 of the Laws of 1933, Ex. Ses., p. 26, Bern. 1934 Sup., § 3035-1 [P. C. § 77-11]
et seq.
It is more comprehensive than the earlier act, but, speaking generally, it does not
appear to meet the objections that were sustained by the court to the former act in the
Widen
and
Griffiths
cases,
supra,
but, on the other hand, is a more complete abdication of the legislative power than the 1933 act.
Sections 2 and 7 of the present act, while more elaborate than the like numbered sections of the prior act, are still apparently just as fatally deficient in providing a primary definite standard for the guidance of the director of agriculture in price fixing and market control.
Section 3 of the Laws of 1935, p. 172, is a new section introducing matter which did not appear in the former act. It reads:
“Sec. 3. a. It is hereby further declared to be the policy of the legislature to increase the consumption of Washington grown agricultural products and to that end, and for other purposes set out in this act, the director, with the approval of the governor, may provide, in any marketing agreement covering any agricultural product, or competing commodity, produced or sold within this state, for assessments to be levied upon such products and manner of collecting such assessments. Failure by any person to comply with assessment regulations specified in any marketing agreement shall be construed to be a violation of this act.
“b. Such assessments shall be used (1) to pay the cost and expense of administering and enforcing the marketing agreement; (2) to advertise such Washington agricultural products; (3) to obtain relief from discriminatory freight rates on such agricultural products ; (4) to obtain relief from competing agricultural products of foreign countries, by securing reasonable tariffs on such competing products; (5) to secure the passage or promulgation of laws or rules and regulations by the United States Congress, and/or the respective Federal departments and bureaus, providing for the inspection and certification at the point of ship
ment as to the purity and grade of Washington agricultural products; (6) to carry on, and have carried on, scientific researches to develop further and greater uses of such products as food and therapeutic agencies, and (7) to do such other things as will tend to effectuate the purposes of the respective marketing agreements.
“c. Any such marketing agreements shall provide for committees to administer such marketing agreements, under the order and direction of the director and subject to his supervision and control. The director shall, by order, provide for the election of the grower and producer members of such committees by the growers and producers affected by such agreements, and the election of the wholesaler, processor, retailer and handler members of such committees by the wholesalers, processors, retailers and handlers of such products, in such manner as will insure a fair and impartial election of bona fide members of such industry and who shall fairly represent all branches of the industry affected by the agreements. The consumer members of committees shall be appointed by the governor.” [Bern. 1935 Sup., § 3035-3a.]
Section 19 is also new and reads:
“All marketing agreements, rules and regulations heretofore adopted or prescribed by the director, under and by virtue of Chapter 12, Laws of Extraordinary Session 1933-1934, are hereby adopted, constituted and declared to be operative and to remain in force as the rules, marketing agreements and regulations of the director under this act until such time as they or any of them are modified, amended or revoked by the director, as herein provided, and all licenses heretofore issued by the director under said act for the year 1935 shall continue in effect and be construed to be licenses under this act:
Provided, however,
That if any license has been issued to a licensee who conducts his business in more than one location, any license heretofore issued shall apply to only one of such locations:
Provided further,
That nothing in this act
shall be construed as regulating or preventing the practice of ‘Welcome Wagon Service’ in incorporated cities and towns in the State of Washington.” [Rem. 1935 Sup., § 3035-19.]
Section 21 contains the usual saving clause to the effect that, if any part of the act be held unconstitutional, the remainder of the act shall not be affected thereby.
The 1935 act cures none of the defects in the 1933 act, but leaves the situation more nebulous and indefinite, because the delegation of power is not only to a state administrative officer, the director, but to the director and a special privileged group of private persons. ' Section 7 of the 1935 act sets up a tribunal or body in each industry, headed by the director, which, under the provisions of § 19, has the power to amend, modify or revoke what appellants claim has become by adoption or reference the statutory law of the state.
Besides being more nearly an offense against the constitutional prohibition forbidding monopolies, Article XII, § 22, Washington constitution (although that question is not necessary now to determine), it is an unauthorized delegation of legislative power to the officers and persons specified therein.
Such legislative delegation is more pronounced than under the 1933 law. It is governed by the decisions in the
Uhden
and
Griffiths
cases,
supra,
and
Panama Refining Co. v. Ryan,
293 U. S. 388, 55 S. Ct. 241, cited therein;
Tucson v. Stewart,
40 P. (2d) (Ariz.) 72; and
Gibson Auto Co. v. Finnegan,
259 N. W. (Wis.) 420.
In the last cited case, that court said:
“It is difficult to conceive of a more complete abdication of legislative power than is involved in this act. Not only is the power to determine whether or not there shall be a law at all delegated to an indefinite class or group, but the Governor and all other public
officers are rendered powerless to act except upon the initiative of a preponderant majority of a group. It must be borne in mind that the power delegated is not the power to organize and adopt self-governing ordinances. The power delegated is the power to frame and adopt a code which, when approved, becomes a law with penal sanctions.”
That court accordingly held invalid an act patterned after the national industrial recovery act and enacted as an emergency act to promote industrial recovery. The court held that the legislature could not, in effect, abdicate its legislative function, and an act which attempted to do so was invalid in fact, though valid in form.
The same reasoning and principles apply to this act.
The United States supreme court also recently decided in a unanimous decision in
Schechter Poultry Corporation v. United States,
295 U. S. 495, 55 Sup. Ct. 837, that § 3 of the national industrial recovery act, authorizing the making of codes for the government of trades and industries by or with the approval of the president of the United States, without setting up any standards aside from the .statement of the general aim of rehabilitation, correction and development of trades and industries, was an unconstitutional delegation of power to the executive department. It reiterated its previous declaration that extraordinary conditions do not create or enlarge constitutional power and cannot justify governmental action outside the sphere of constitutional authority. The reasoning of that decision is too long to repeat here to any great extent, but is unanswerable.
The 1935 act, in attempting to “adopt,” “constitute,” or ratify unlawful orders or edicts, made under an invalid statute, did not cure the defects of the 1933 law and also attempts to ratify an unconstitutional delegation of legislative power. See 6 R. C. L. 120.
For the foregoing reasons, the judgment of the trial court as to the first cause of action must be, and is, reversed.
Millard, C. J., Mitchell, Main, and Steinert, JJ., concur.