Source: https://supreme.justia.com/cases/federal/us/251/95/
Timestamp: 2019-04-22 17:59:13+00:00

Document:
Where a manufacturer of goods habitually causes them to be carried on his vehicles from the manufacture to various establishments of retail dealers who are his customers in an adjoining state, and there sold and delivered to such dealers in the original packages in such quantities as they may desire to purchase at the times of such visits, the business, as thus transacted with them, is that of an itinerant vender or peddler, and may be taxed in the second state under a nondiscriminating license tax law without imposing a direct burden on interstate commerce. P. 251 U. S. 102.
A state tax which in substance and effect is constitutional cannot be made otherwise by the name it bears in the state laws and decisions. P. 251 U. S. 101.
sales in Covington are made from the vehicle by the driver in the manner mentioned. Sometimes the driver succeeds in selling there the entire supply thus carried upon the wagon, sometimes only a part thereof, or he may return after having made but a few sales, or none at all, in which event he carries the unsold supply back to plaintiffs' place of business in Cincinnati. The soft drinks in question are delivered in stopped bottles or siphons, according to their nature, and these are placed (at the bottling works) in separate wooden or metal cases, each case being open at the top and holding a certain number of bottles or siphons, according to the nature of the drinks and the custom of the trade. The filled bottles or siphons are carried upon the vehicle, sold, and delivered in these cases, each case remaining entire and unbroken, and nothing less than a case being sold or delivered. The retail dealers usually pay cash, and purchase only the contents of the bottles, while the bottles and cases remain the property of plaintiffs and are subsequently collected, when empty, by plaintiffs' drivers or agents on their regular visits. There are, however, a few customers who pay for and thereafter own the bottles in which distilled water is delivered. The ordinances were and are respectively applicable to all wholesale dealers in such soft drinks in Covington, whether the goods were or are manufactured within or without the state.
The trial court, and on appeal, the Court of Appeals of Kentucky, gave judgment for defendant, overruling the contention of plaintiffs that the ordinances as carried into effect against them were repugnant to the "commerce clause" (Art. I, § 8) of the Constitution of the United States, 177 Ky. 385, and upon this federal question the case is brought here by writ of error.
state to the other in response to orders previously received at their place of business in Cincinnati, plaintiffs are engaged in interstate commerce, not subject to the licensing power of the Kentucky municipality. The Court of Appeals in the present case, in line with its previous decisions in City of Newport v. Wagner, 168 Ky. 641, 646, and City of Newport v. French Brothers Bauer Co., 169 Ky. 174, recognizing the authority of the decisions of this Court bearing upon the subject, conceded that this part of plaintiffs' business was not subject to state regulation. 177 Ky. 388. At the same time, the court held that, with respect to the remaining and principal part of the business conducted in Covington, that which consists in carrying a supply of goods from place to place upon wagons, exposing them for sale, soliciting and negotiating sales, and immediately delivering the goods sold, plaintiffs were subject to the licensing ordinances, and it is with this alone that we have to deal. If, with respect to this portion of their business, plaintiffs may be subjected to the regulatory power of the state acting through the municipality, we are not concerned with the question whether the general language of the ordinances, if applied with respect to some other method of dealing with goods brought from state to state, might be repugnant to the federal Constitution.
Ky. 174, 185. These decisions, however, deal merely with a question of statutory definition, and it hardly is necessary to repeat that, when this Court is called upon to test a state tax by the provisions of the Constitution of the United States, our decision must depend not upon the form of the taxing scheme, or any characterization of it adopted by the courts of the state, but rather upon the practical operation and effect of the tax as applied and enforced. The state court could not render valid, by misdescribing it, a tax law which in substance and effect was repugnant to the federal Constitution; neither can it render unconstitutional a tax that in its actual effect violates no constitutional provision by inaccurately defining it. St. Louis Southwestern Ry. v. Arkansas, 235 U. S. 350, 235 U. S. 362.
We have, then, a state tax upon the business of an itinerant vender of goods as carried on within the state, a tax applicable alike to all such dealers, irrespective of where their goods are manufactured, and without discrimination against goods manufactured in other states. It is settled by repeated decisions of this Court that a license regulation or tax of this nature, imposed by a state with respect to the making of such sales of goods within its borders, is not to be deemed a regulation of or direct burden upon interstate commerce, although enforced impartially with respect to goods manufactured without as well as within the state, and does not conflict with the "commerce clause." Woodruff v. Parham, 8 Wall. 123, 75 U. S. 140; Machine Co. v. Gage, 100 U. S. 676; Ement v. Missouri, 156 U. S. 296; Baccus v. Louisiana, 232 U. S. 334.
The peddler's license tax considered in Welton v. Missouri, 91 U. S. 275, was denounced only because it amounted to a discrimination against the products of other states, and therefore to an interference with commerce among the states. To the same effect, Walling v. Michigan, 116 U. S. 446, 116 U. S. 454.
Of course, the transportation of plaintiffs' goods across the state line is of itself interstate commerce, but it is not this that is taxed by the City of Covington, nor is such commerce a part of the business that is taxed, or anything more than a preparation for it. So far as the itinerant vending is concerned, the goods might just as well have been manufactured within the State of Kentucky; to the extent that plaintiffs dispose of their goods in that kind of sales, they make them the subject of local commerce, and, this being so, they can claim no immunity from local regulation whether the goods remain in original packages or not.
"When goods are sent from one state to another for sale or in consequence of a sale, they become part of its general property, and amenable to its laws, provided that no discrimination be made against them as goods from another state and that they be not taxed by reason of being brought from another state, but only taxed in the usual way as other goods are. Brown v. Houston, 114 U. S. 622; Machine Co. v. Gage, 100 U. S. 676. But to tax the sale of such goods, or the offer to sell them, before they are brought into the state is a very different thing, and seems to us clearly a tax on interstate commerce."
Brennan v. Titusville, 153 U. S. 289; Caldwell v. North Carolina, 187 U. S. 622; Rearick v. Pennsylvania, 203 U. S. 507, 203 U. S. 510; Dozier v. Alabama, 218 U. S. 124; Browning v. Waycross, 233 U. S. 16; Western Oil Refining Co. v. Lipscomb, 244 U. S. 346; Cheney Bros. Co. v. Massachusetts, 246 U. S. 147, 246 U. S. 153.
No. 62. Gilligan v. City of Covington. By stipulation of counsel, this case was heard with No. 61, and it is agreed that a similar judgment is to be entered.

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