Townsend v. Yeomans

301 U.S. 441, 57 S. Ct. 842, 81 L. Ed. 1210, 1937 U.S. LEXIS 300
CourtSupreme Court of the United States
DecidedMay 24, 1937
Docket781
StatusPublished
Cited by112 cases

This text of 301 U.S. 441 (Townsend v. Yeomans) is published on Counsel Stack Legal Research, covering Supreme Court of the United States primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Townsend v. Yeomans, 301 U.S. 441, 57 S. Ct. 842, 81 L. Ed. 1210, 1937 U.S. LEXIS 300 (1937).

Opinion

Me. Chief Justice Hughes

delivered the opinion of the Court.

This suit was brought by tobacco warehousemen to restrain the enforcement of a statute of Georgia, approved March 28, 1935, fixing maximum charges for handling and selling leaf tobacco. Ga. L. 1935, pp. 476-8.

The statute was assailed as an arbitrary and capricious exercise of state power, repugnant to the Fourteenth Amendment of the Federal Constitution, and as placing a direct burden upon interstate commerce in violation of the commerce clause. The hearing in the District Court was by three judges (28 U. S. C. 380) and, upon findings of fact and conclusions of law, a final decree was entered dismissing the bill of complaint, one judge dissenting. The case comes here on appeal.

The facts found by the District Court with respect to the tobacco industry in Georgia and the nature of the transactions at the warehouses are not in dispute. It appears that this industry is relatively new, beginning in 1917, but by the year 1925 it was becoming well established. The type of tobacco grown in Georgia is the “bright leaf” which is almost exclusively used in the manufacture of cigarettes. This variety is grown extensively in North Carolina, to a much less extent in South Carolina and Georgia, and to some extent in Virginia, Kentucky and Tennessee. The acreage planted by the individual farmer in Georgia is comparatively small but the aggregate acreage is now not only very considerable but is widely distributed over a large area in the southern portion of the State.

The necessity for markets and the early maturity of the tobacco in Georgia presented an opportunity which *444 was early recognized by experienced and skilled ware-housemen who were operating in the tobacco belts of North Carolina and other States, where selling seasons begin sometime after the termination of the selling season in Georgia. With few exceptions, competent ware-housemen, and experienced and skilled auctioneers and helpers in handling and selling tobacco are not found in Georgia and must be obtained from other States. There were forty-five warehouses operated in 1935, thirty-nine of which were connected in some capacity with warehouses in North Carolina, Kentucky, Virginia or Tennessee.

The principal purchasers of the bright leaf tobacco grown in Georgia and elsewhere are limited to a few large manufacturers of cigarettes. These are called “the Companies.” They purchase tobacco only at warehouse auction sales to which they send or furnish “buyers.” Each buyer is the representative of one of the competing purchasers and a “set of buyers,” usually from eight to twelve in number, is made up of representatives from each of the purchasing cigarette manufacturers. The presence of a “set of buyers” is essential at an auction sale. A town having one or more warehouses is known as a “market.” By sending a set of buyers to a new warehouse, the manufacturers may recognize a new market, and by refusing to send one to an old market may cause its abandonment; and by sending either one or two sets of buyers to a given market the manufacturers may determine the rapidity with which the accumulated tobacco may be disposed of. There is another class of purchasers known as “speculators.” These on rare occasions buy tobacco from a grower and have it transported to a warehouse for sale. At auction sales speculators to a limited extent, as compared with buyers, purchase tobacco for a later sale. There is strenuous and expensive competition between warehousemen in securing tobacco from growers to be *445 handled and sold, but in the sale of tobacco there is no competition except such as exists between the respective buyers and speculators at the auction sales, and the bids of the warehousemen themselves.

The tobacco belt in Georgia comprises about twenty counties in the southern part of the State, and in 1935 there were fifteen towns known as “markets.” Seven of the markets were supplied with one set of buyers and eight were furnished two sets. The “two set markets” had a total of thirty and the “one set markets” a total of fifteen warehouses in operation. The quantity of tobacco sold in the warehouses and the average prices ranged from 106,483,019 pounds at 9.86 cents per pound in 1930, to 71,826,352 pounds at 18.91 cents per pound in 1935.

After the tobacco has been cured and is ready for the market, the grower grades it as best he can and the resulting “piles” of loose leaves are placed in sheets which are then tied and the tobacco is so transported to the selected warehouse for sale. Auction sales are held daily during five days of the week, and in any particular warehouse as often as sufficient tobacco accumulates. It is essential that there be present the warehouseman, an auctioneer and other skilled help, and one set of buyers. The warehouseman makes the opening bid. If this is not taken or raised by another, the warehouseman generally becomes the purchaser of the tobacco for his own account. If not sold in that fashion the bidding continues until the sale is announced. The grower or other owner may turn down the sale and in such case he may hold the tobacco for a later sale or remove it. After the sale has been completed the tobacco is delivered to the purchaser who removes it from the floor. The purchaser has it reweighed and pays the warehouseman. The warehouseman then pays the seller the purchase price, less warehouse charges. Tobacco purchased by the warehouseman is afterwards sold by him at auction.

*446 The tobacco is ready for the market in the latter part of July or early in August. The exact date for opening the selling season is fixed by the manufacturers, who are the principal buyers, and the warehousemen. The selling season is from three to five weeks in length. The short tobacco season causes growers to rush tobacco to the market and does not give them a fair opportunity “to properly grade, store, bundle, and orderly market their tobacco.” The short season is in large part occasioned by the efforts of the manufacturers to transfer their buyers to the North Carolina belts, in some of which the selling seasons begin early in September, and the efforts of the warehousemen to dispose of the tobacco in Georgia so that they and their auctioneers and other skilled employees may proceed to the later and larger seasons of North Carolina and other States.

When the Act in question was passed, the warehouse charges, based upon three elements, the sale value, the number of piles handled and the weight of the quantity sold, were as follows:

Commissions: 2y2 per cent, on gross sales.
Auction fees: 25 cents per pile up to 200 pounds; 50 cents per pile above 200 pounds.
Weighing and handling fees: 25 cents per pile up to 100 pounds, and 25 cents for each additional 100 pounds.

The Act of 1935 prescribed the following maximum charges:

Commissions: 2y2 per cent, on gross sales.
Auction fees: 15 cents on all piles of 100 pounds or less; 25 cents on all piles over 100 pounds.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Commonwealth v. Lora
16 Mass. L. Rptr. 715 (Massachusetts Superior Court, 2003)
In Re Reapportionment of Town of Hartland
624 A.2d 323 (Supreme Court of Vermont, 1993)
Ago
Florida Attorney General Reports, 1978
Gentry v. Howard
365 F. Supp. 567 (W.D. Louisiana, 1973)
Ridinger v. General Motors Corporation
325 F. Supp. 1089 (S.D. Ohio, 1971)
Lockheed Air Terminal, Inc. v. City of Burbank
318 F. Supp. 914 (C.D. California, 1970)
Petstel, Inc. v. County of King
459 P.2d 937 (Washington Supreme Court, 1969)
Medley v. Stephens
412 S.W.2d 823 (Supreme Court of Arkansas, 1967)
Joseph E. Seagram & Sons, Inc. v. Hostetter
384 U.S. 35 (Supreme Court, 1966)
United States v. State of Texas
252 F. Supp. 234 (W.D. Texas, 1966)
Hudson County News Co. v. Sills
195 A.2d 626 (Supreme Court of New Jersey, 1963)
W.M.C.A., Inc. v. Simon
208 F. Supp. 368 (S.D. New York, 1962)
Campbell v. Hussey
368 U.S. 297 (Supreme Court, 1962)
Fried v. Kervick
167 A.2d 380 (Supreme Court of New Jersey, 1961)
Winery v. Board of Liquor Control
149 N.E.2d 733 (Ohio Court of Appeals, 1956)
Untitled Texas Attorney General Opinion
Texas Attorney General Reports, 1952
Chissell v. Mayor Etc. of Baltimore
69 A.2d 53 (Court of Appeals of Maryland, 1949)
H. P. Hood & Sons, Inc. v. Du Mond
336 U.S. 525 (Supreme Court, 1949)

Cite This Page — Counsel Stack

Bluebook (online)
301 U.S. 441, 57 S. Ct. 842, 81 L. Ed. 1210, 1937 U.S. LEXIS 300, Counsel Stack Legal Research, https://law.counselstack.com/opinion/townsend-v-yeomans-scotus-1937.