State v. Potomac Coal Co. , 116 Md. 380 ( 1911 )

The Potomac Valley Coal Company, and the Hamill Coal and Coke Company, each being a body corporate, were separately indicted in the Circuit Court for Garrett County, charged with the violation of Chapter 211 of the Acts of 1910, a local law for Garrett County. The charge in each case was precisely the same, viz, the failure to pay to a certain named employee of each company, semi-monthly, the wages respectively earned by such employee, as required by said act; and the indictments were precisely similar, the only difference between the two cases being that the Potomac Valley Coal Company was created under the general incorporation law of Maryland, while the Hamill Coal and Coke Company was created under the general incorporation law of Virginia, but this difference in no way affects the disposition of the question involved in each case.

In each case it was conceded that the indictments are technically correct and demurrers were interposed for the sole purpose of determining the constitutionality of the act under which the indictments were drawn. The cases were argued together below, and the Circuit Court held the act to be unconstitutional and void, and sustained the demurrer in each case, and judgment being entered for the defendants upon the demurrers, the State has brought these appeals, which were submitted upon single briefs filed in both cases.

The title of the act in question is as follows: "An act to repeal Chapter 37 of the Acts of 1904, entitled an act to require all corporations engaged in mining coal or fire clay in Garrett County to pay their employees wages due semi-monthly and to re-enact the same with amendments," and we will transcribe the act below:

"Section 1. Be it enacted by the General Assembly ofMaryland, That Chapter 37 of the Acts of 1904, entitled An Act to require all Corporations engaged in Mining Coal or Fire Clay in Garrett county to pay their employees wages, due semi-monthly, be and the same is hereby repealed and re-enacted with amendments to read as follows:

Section 2. That all corporations, or individual mine owners,now or hereafter engaged in mining coal or fire clay in Garrett county, be and the same are hereby required to pay each and all their employees their wages earned in said employment semi-monthly; that is to say, all wages earned on or before the 15th day of each month shall be paid not later than the 25th day of each month, and all wages earned from sixteenth to the last day of the month, both inclusive, shall be paid on or before the tenth day of the succeeding month, unless said twenty-fifth day, or tenth day, shall fall on Sunday or a legal holiday, in which case the time of payment shall be extended to the next day; and if payment as above is to be made before thetwenty-fifth or the tenth day of any month, it shall be the dutyof the mine owner, agent, superintendent, or paymaster of eachmine, to notify their employees at least three days in advance ofsuch intended payment, by posting notices at their respectiveplaces of employment.

Section 3. That any corporation, association or individual, operating a coal or fire clay mine in Garrett county, that shall fail or neglect to make payment of wages at the times and in the manner hereinbefore specified in section 2 of this act, shall be deemed guilty of a misdemeanor, and upon indictment and conviction thereof shall be fined not less than fifty dollars nor more than three hundred dollars in the discretion of the Court."

The only amendments made by Chapter 211 of 1910 to the language of Chapter 37 of 1904, are indicated by the words in the above transcript which are italicised, so that the only apparent, or rationally inferable, purpose of amending the act was to embrace in its provisions, individuals as well as corporations, and those then as well as thereafter engaged in the pursuits mentioned.

Two grounds of demurrer are assigned:

(1) That the act interferes with the right of personal liberty guaranteed both by the 23rd Article of the bill of rights of Maryland, and by the 14th amendment to the Constitution of the United States, in that it abridges the freedom of contract which is an essential element of personal liberty, unless some restriction is made in the legitimate exercise of the police power.

(2) That it discriminates unreasonably against particular classes of employers, and thus denies to those classes the equal protection of the laws guaranteed by the 14th amendment to the Constitution of the United States.

These questions have been many times, in many forms, before the highest State Courts and the Supreme Court of the United States, and it is not surprising in the multitude of such cases, in view of the nice distinction of facts sometimes existing, the ingenuity and skill of able counsel, and the diverse mental habits and training of the judges who are required to decide these questions, that the decisions are not always clearly consistent, or readily reconcileable, but through them all there will be found certain basic principles established, which, kept steadily in view afford a reasonable safe guide for their just application to any state of facts which may be presented, and we will now proceed to state some of the principles thus established.

JUDGE COOLEY in his work on Constitutional Limitations (5th Ed.), page 391, says: "Every one has a right to demand that he be governed by general rules, and a special statute which, without his consent singles his case out as one to be regulated by a different law from that which is applied in all similar cases, would not be legitimate legislation, but would be such an arbitrary mandate as is not within the province of free government. * * * The doubt might also arise whether a regulation made for any one class of citizens, entirely arbitrary in its character, and restricting their rights, privileges, or legal capacities in a manner before unknown to the law, could be sustained, notwithstanding its generality. Distinctions in these respects must rest upon some reason upon which they can be defended, like the want of capacity in infants and insane persons; and if the legislature should undertake to provide that persons following some specified lawful trade or employment should not have capacity to make contracts, or to receive conveyances, or to build such houses as others were allowed to build, or in any other way to make such use of their property as was permissible to others, it can scarcely be doubted that the act would transcend the due bounds of legislative power, even though no express constitutional provision could be pointed out with which it would come in conflict. To forbid to an individual or a class the right to the acquisition or enjoyment of property in such manner as should be permitted to the community at large, would be to deprive them of liberty, in matters of primary importance to `their pursuit of happiness;' and those who shouldclaim a right to do so ought to be able to show a specificauthority therefore, instead of calling upon others to show howand where the authority is negatived," idem 393. In exception to these general principles, "the police power is universally conceded to include everything essential to the public safety, health and morals, * * * Beyond this, however, the State may interfere wherever the public interests demand it, and in this particular a large discretion is vested in the legislature to determine not only what the interests of the public require, but what measures are necessary for the protection of such interests.Barbier v. Connolly, 113 U.S. 27; Kidd v. Pearson,128 U.S. 1. But to justify the State in thus interposing itsauthority, it must appear, first, that the interests of thepublic generally, as distinguished from those of a particularclass, require such interference; and, second, that the means are reasonably necessary for the accomplishment of the purpose. The Legislature may not under the guise of protecting the public interests, arbitrarily interfere with private business, or impose unusual or unnecessary restrictions upon lawful occupations."Lawton v. Steele, 152 U.S. 388.

Instances where the police power may be validly exercised, are the destruction of a dilapidated house on a highway endangering passers-by, or blowing up houses in a town to stay a conflagration, the slaughter of diseased cattle, the destruction of impure milk being served to the general public of a community, the compulsory vaccination of school children, the suppression of houses of ill fame, or of obscene publications, and even the regulation of railways and other recognized public utilities. All these have direct and obvious relation to the public safety, health, morals or general welfare, and this relation is immediately suggested to the most ordinary intelligence and perception. The learned Judge of the Circuit Court in his opinion forcibly observes, "the act does not explain or even suggest any reason why mining concerns should pay their employees twice a month, when railroad, lumbering or manufacturing concerns are not required to do so. Nor is there any reason for such classification and differentiation that occurs to the mind of the Court."

The Attorney-General in his ingenious and very able brief lays much stress upon what he characterizes as the "socio-economic isolation of mining communities," and argues that mining corporations discharge peculiar duties, of public consequence and concern, and affecting the general public as distinguished from those of certain communities or localities, but we can not accept this as a satisfactory distinction. That contention was made inMillett v. People, 117 Ill. 294, in reliance upon Munn v.Illinois, 94 U.S. 113, but was not approved, the Court saying: "The public are not compelled to resort to mine owners any more than they are compelled to resort to the owners of wood or turf, or even to the owners of grain, domestic animals or to those owning any of the other ordinary necessities or conveniences of life, which form a part of the commerce of the country. The owner of a coal mine is under no obligation to obtain a license from any public authority and therefore when he chooses to mine his coal he exercises no franchise." In the same case the Court said: "Why should the owner of the mine, or the agent in control of the mine, not be allowed to contract in respect to matters as to which all other property owners and agents may contract? Undoubtedly, if these sections (regulating the weighing of coal in so far as it nullifies all contracts for mining coal which dispense with such weighing) fall within the police power, they may be maintained on that ground; but it is quite obvious they do not;" and the Court also cited with approval the following passage from Walley's Heirs v. Rennedy, 2 Yerger, 554: "Every partial or private law which directly proposes to destroy or affect individual rights, or does the same thing by affording remedies leading to similar consequences, is unconstitutional or void. Were it otherwise,odious individuals or corporate bodies would be governed by onelaw, the mass of the community, and those who made the law, byanother; whereas a like general law affecting the whole communitygenerally could not have been passed." We have been referred to no consideration of the public health, safety, morals or general welfare which can justify this act as the legitimate exercise of the police power of the State, and none of the cases relied on for that purpose, in our judgment, are at all analogous to the case before us. The complete, and to our minds conclusive answer, to the argument that this case is within the police power, is admirably expressed in the language of the Court in In reJacobs, 98 N.Y. 114. "Such legislation may invade one class of rights today and another tomorrow; and if it can be sanctioned under the Constitution, while far removed in time, we will not be far away in practical statesmanship from those ages when governmental perfects supervised the building of houses, the rearing of cattle, the sowing of seed, and the reaping of grain, and governmental ordinances regulated the movements and labor of artisans, the rate of wages, the price of food, the diet and clothing of the people, and a large range of other affairs long since, in all civilized lands, regarded as outside of governmental functions. Such governmental interferences disturb the normal adjustments of the social fabric and usually derange the delicate and complicated machinery of industry, and cause a score of ills while attempting the removal of one."

In Frorer v. People, 141 Ill. 171, the Court said: "The privilege of contracting is both a liberty and a propertyright, and if A. is denied the right to contract and acquire property in a manner which he has hitherto enjoyed under the law, and which B., C. and D. are still allowed by the law to enjoy, it is clear that he is deprived of both liberty and property to the extent that he is thus denied the right to contract."

In In re Jacobs, supra, the New York Court of Appeals thus expressed the same principle, "One may be deprived of his liberty, and his constitutional right thereto violated, without the actual restraint of his person. Liberty, in its broad sense, as understood in this country, means the right not only of freedom from servitude, imprisonment, or restraint, but the right of one to use his faculties, in all lawful ways, to live and work where he will, to earn his livelihood in any lawful calling, and to pursue any lawful trade or avocation."

In State v. Goodwill, 33 W. Va. 188, the act under consideration which restricted the right of contract in respect to the method and time of payment for their labor was made applicable to all persons or corporations engaged in mining, or manufacturing from coal or other minerals, or any other kind of manufacturing, and the Court said: "While these terms include all persons engaged in any kind of manufacturing, such as the shoemaker, cigar maker, distiller, brick maker, jeweller, weaver, milliner, tailor or miller, it does not include the wholesale merchants with their hundreds of clerks and agents, nor the railroad, and construction companies, with their thousands of employees. The propriety or necessity, if such exists, of applying the provisions of the statute to these latter, is equally as great if not more so, as it is to any of the former. The rights and privileges of certain specified employers are abridged while others of the same class are left free." * * * "When the subject of contract is lawful, not public in itscharacter, and the exercise of it is purely private and personalto the parties, it can not be for holden or limited by the Legislature." The statute in that case was an almost literal copy of a Pennsylvania statute, declared in Godcharles v. Wigeman, 113 Pa. St. 431, to be unconstitutional "because it prevented persons sui juris from making their own contracts."

The logical and convincing test of this question is whether the subject of contract, is public or private in its character, as expressed in the West Virginia case, supra, which is in that respect typical of all the more important cases holding acts to be void which interfere with the liberty of contract. St. Louisand Iron Mountain R.R. v. Paul, 173 U.S. 404, is a typical case of the converse of the proposition, where the subject of contract is of a public character. The act in that case provided that railroad companies should pay the wages of their employees, without deduction, whenever they were discharged, and if not so paid, that then, as a penalty, such wages should continue at the same rate until paid, during a period not exceeding 60 days. That act was upheld as not an infraction of the Fourteenth Amendment, upon the distinct ground however, that the railroadcorporations were clothed with a public trust, and discharged duties of public consequence affecting the community at large.

No case has been cited from the Supreme Court of the United States which measures up to the contention of the Attorney-General, and which, in such event, it would be our duty to obey.

We have, however, in Maryland, the case of Luman v.Hitchens, 90 Md. 14, in which an act of our Legislature prohibiting railroad and mining corporations, their officers or agents, from selling or bartering goods, wares and merchandise in Allegany County to their employees, was held not to have been passed in the exercise of the Police Power of the State, and to be repugnant to the Fourteenth Amendment because "the attempted classification was arbitrary, and was not made to rest upon some difference which bears a reasonable and just relation to the act — the thing — in respect of which the classification is proposed."

We fully concur with the Circuit Court that that decision is precisely applicable to the case at bar, and that in the absence of paramount authority from the Supreme Court of the United States it is our duty to follow the ruling in Luman v.Hitchens.

Without discussing the question whether, as to corporations, this act could be sustained as amending the charters of either domestic or foreign corporations doing business in this State, while striken down as to individuals, we do not think it conceivable that the Legislature would have passed the act at all, if they had anticipated the discrimination which would thus be worked in favor of the employees of corporations as against those of natural persons. Nutwell v. Anne Arundel County,110 Md. 669.

The opinion of the learned Judge of the Circuit Court contains so thorough and impartial a review of the leading cases relied on by counsel upon both sides that we shall direct it to be published in connection with this opinion.

Judgment affirmed in both cases.