The semi-weekly messenger. [volume] (Wilmington, N.C.) 1897-1908, 1905-05-30

| the goods are o to be delivered bul
n party is to pay the other the diff
feienee between the contract price and
the market price of the goods at the
date fixed for executing the contract.
the whole transaction is nothing more
than a and is null and void
Wagner vs. H~ildebrand. Is! Pa. st.
1876: Jameson vs.. Wallace. 167 Ill.
$50. Wheeler VS.. Stock Exchange. q
New II. 315: clews VS.. Jameson. 49,
T.. $. al: Pickering VS. Cease. IS I'll.
32S, Bib vs.. Allen. 149 u. S. 4S1. /
Cook on Stock and Stockholders. Bird
Ed. Sec. BAL.
Freund On Police Power ,19o4) D..
1S3 says: 1T is well established that
II there is nc intention to buy or sell.
but only to pay or receive differences
IL value. the transaction is simply bet
ting on the rise or fall Of market
prices. and hence illegal n void"
While the facts found bring the de-
PENDANT within the words Of the stat
lite. it is contended that the addition
of the seventh and last section made
the whole act unconstitutional and
void under the Fourteenth Amend
ment to the Constitution Of the United
States. which guarantees the equal
protection Of the laws. Said Section
{ reads: This act shall not be con-
strucd so as to apply to any person.
firm. corporation or his or their agent.
engaged in the business of
turing or wholesale merchandising IN
the purchase or sale of the necessary
commodities required in the ordinary
course of their business" This Sec
ton is stated by counsel. and We De
lieve was admitted on the argument.
to have been added upon the passage
of the bill in the second house. 1t was
doubtless hastily drawn. for it is
clearly not to The statute
which is for the prohibition of h es-
tablishment or opening an office fo-
the Durpos of engaging in or carrying
on the business Of a bucket shop"
i. e. dealing in the sale of futures
where lit is not intended by the par
ties thereto hat the articles agreed
to be sold and delivered shall be ac-
tually delivered. OF the value thereof
paid. but it IS intended and under
stood by them" that merely the diff
ference between the contract price
and the market price of the article at
the time specified shall be paid. Such
condemned business has no comes
tion with. and the constitutionality of
the prohibitive act is in nowise affect
ed by. the provision iE section Z that
when any person. firm. or corporation
engaged IN manufacturing OF whole
sale merchandise shall purchase or
sell the necessary commodities re-
Xix Il k4IC SOoASS ~ NA>A
business it shall not be deemed a
violation "of this act"-the act forbid
ding the business Of carrying on a
bucket shop
The defendant. however. contends
hat the purpose of section Z is to pro-
vide that where any manufactOry or
wholesale merchandising house shall
contract to deliver goods at a future
date. such establishment may protect
itself or hedge Gas it is called> by
purchasing a future" contract for
raw commodities. without intending
to demand actual delivery Of those
identical goods. but. by the profit
thereby made. to recoup the loss by
the rise in price of the same commod-
ity subsequently, bought. PERHAPS for
actual delivery nearer home, to save
freight. 1t is enough to say that no
such intent is expressed in section I
and we must construe it as it is writ
ten.
But were it SO expressed we are not
prepared to a such purchase. for the
bona fide purpose Of protection in the
purchase OF raw material to be used
in the ordinary course Of business and
not for wagering" or gambling on
the fluctuations of the market. would
be against The statute. The statute or
this state does not prohibit all Dur
chases or sales for future delivery. but
III SOSlI oo LII Ill tAA 'S
ture of gambling OR wagering con-
tracts. Though section 7 mentions
only manufacturers and wholesale
mercEantile establishments as author
ICED to make ona fd dealings in
Futures this was done unnecessari-
ly. we think. and only ont of abundant
caution. It is not a observation-disclosures
there is no prohibition upon any one
else or any other business to buy COM
modites for future delivery bona hde
in the 'ordinary course Of such bust
ness when not for speculative or
gambling purposes That no bust
nesses are mentioned as authorized
to deal bonafide for the purchase of
commodities on "margin" is not an
implied restriction uDon others to do
act not forbidden by any statute.
Section Z does not confer any exclu-
sive right or privilege UPON manufac-
turers or wholesale merchants. 1t
Goes rot authorize them to engage in
any business prohibited by the Act of
1889. Il does net authorize them to
speculate in cotton or other commodi-
ties. 1t simply provides that the
courts shall not construc the Act of
1905 20 have the effect of preventing
from buying and selling for flu
ture deliveries the necessary commodi-
ties required in their ordinary bust |
ness.
The defendant further contends that
by section 5 chapter 53S Laws 1919, |
proof that nothing was actually de-
livered at the date Of the contract n
that & "lnargin'' was put up, shall be |
primo facie evidence that the contract
is a wagering" one and forbidden by
chapter 221 Laws 1889, n that sec
ton { charter SIS Laws 1908 provid-
that his last act shall not apply to
purchases or sales by manufacturers |
or wholesale merchants of the neces- |
commodities required in the or
binary course of their business. is a |
discrimination forbidden by the Four
teenth Amendment. We do not think !
so. for the prescribing when and UNI
der what circumstances as to what Of
a prima facie presumption shall
arise. is necessarily a matter left to
discretion in the exercise !
Of the police power. There may be
good reasons why the purchase OF
necessary commodities required in !
ordinary course of their business
for future delivery on a margin. by |