Court Opinion

ID: 9653273
Source: CourtListenerOpinion
Date Created: 2023-08-23 17:42:39.782057+00
Date Added: 2024-06-11T18:12:57.475350
License: Public Domain

PHILLIPS, Circuit Judge (concurring).
I concur in the result reached in the opinion of Judge COTTERAL, but, on the question of whether a cotton gin is “affected with) a public interest,” I am not in full accord with all that is said in such opinion.
In Wolff Packing Co. v.. Court of Industrial Relations, 262 U. S. 522, at page 535, 43 S. Ct. 630, 632, 67 L. Ed. 1103, 27 A. L. R. 1280, the court divides businesses, said to be “clothed with a public interest,” into three classes and defines the second and third classes as follows:
“(2) Certain occupations, regarded as exceptional, the public interest attaching to which, recognized from earliest times, has survived the period of arbitrary laws by Parliament or colonial Legislatures for regulating all trades and callings. Such are those of the keepers of inns, cabs, and grist mills. State v. Edwards, 86 Me. 102, 29 A. 947, 25 L. R. A. 504, 41 Am. St. Rep. 528; Terminal Taxicab Co. v. [Kutz] District of Columbia, 241 U. S. 252, 254, 36 S. Ct. 583, 60 L. Ed. 984, Ann. Cas. 1916D, 765.
“(3) Businesses which, though not pub-lie at their inception, may be fairly said to have risen to be such and have become subject in consequence to some government regulation. They have come to hold such a peculiar relation to the public that this is superimposed upon them. In the language of the cases, the owner by devoting his business to the public use, in effect grants the public an interest in that use and subjects himself to public regulation to the extent of that interest although the property continues to belong to its private owner and to be entitled to protection accordingly.”
Judge COTTERAL holds that cotton ginning falls within both the second and third classes. It is my opinion that it falls only within the third class. It may be analogous to some of the businesses enumerated in the second classification but it is not a business recognized as a public utility by ancient usage and understanding. Analogies have no definite limitations. They are sometimes dangerous. To hold that all businesses, analogous to inns, cabs, and grist mills, are “affected with a public interest,” might ultimately lead us far afield.
In William v. Standard Oil Co., 278 U. S. 235, 49 S. Ct. 115, 116, 73 L. Ed. 287, 60 A. L. R. 596, the Supreme Court said:
“It is settled by recent decisions of this court that a state Legislature is without constitutional power to fix prices at which commodities may be sold, services rendered, or property used, unless the business or property involved is ‘affected with a public interest.’ ~ That phrase * * ® has become the established test by which the legislative power to fix prices of commodities, use of property, or services, must be measured. As applied in particular instances, its meaning may be considered both from an affirmative and a negative point of view. Affirmatively, it means that a business or property, in order to be affected with a public interest, must be such or be so employed as to justify the conclusion that it has been devoted to a public, use and its use thereby in effect granted to the publie. * * * Negatively, it does not mean that a business is *850affected with a public interest merely because it is large or because the public are warranted in having a feeling of concern in respect to its maintenance.
In Wolff Packing Coi v. Industrial Court, supra, the Supreme Court further said:
“The expression ‘clothed with a public interest,’ as applied to a business, means more than that the public welfare is affected by continuity or by the price at which a commodity is sold or a service rendered. The circumstances' which clothe a p'artieular kind of business with a public interest, * * * must be such as to create a peculiarly close relation between the public and those engaged in it, and raise implications of an affirmative obligation on their part to be reasonable in dealing with the public. * * *
“In nearly all the businesses included under the third head above, the thing which gave the public interest was the indispensable nature of the service and the exorbitant charges and arbitrary control to which the public might be subjected without regulation.”
Are indispensable service and probability of subjection to exorbitant prices therefor inherent characteristics of the business of cotton ginning?
The record discloses the following faets:
Cotton growing is Oklahoma’s greatest industry and it is the second largest cotton ginning state in the Union.
Cotton ginning is a manufacturing process; it involves the separation of the seed from the fiber; it is a short but important step in the manufacture of both into useful articles of commerce; it is a process which must take place before either can be marketed.
Cotton farmers, as a class, are not financially independent. An ordinary cotton farmer cannot afford to own and operate his own gin. Because his margin of profit is small, he cannot afford to haul his cotton great distances to have it ginned. He must patronize a cotton gin located within accessible distance to his farm.
In Eastern Cklahoma, the average haul is ten miles and the farmers do not have convenient aceess to more than one gin. In Western Oklahoma, gins are more numerous and many farmers use automobile trucks to transport their cotton to the gins. The use of trucks enables such farmers to transport their cotton greater distances and 'gives them access to more than one gin. The gins operate only during a portion of each year.
At the time the 1915 Act was adopted, the gins rendered poor service, had inadequate equipment, had poor scales and gave irregular weights, and the prices charged were more or less uniform.
Since 1915, approximately 1,310 gins have been operated in Oklahoma as public utilities. These have been owned by between 450 and 500 persons. The number of ginning points in Oklahoma, and the number of gins thereat, are as follows: 312 points with 1 gin each, 111 points with 2 gins each, 74 points with 3 gins each, 39 points with 4 gins each, 40 points with 5 gins each, 13 points with 6 gins each, 7 points with 7 gins each, 4 points with 8 gins each, 1 point with 9 gins, 1 point with 11 gins, 1 point with 15 gins and 1 point with 17 gins. Out of 609 cotton ginning points, 312 points have but 1 gin each. While the other points have 2 or more gins each, the gins at each of such points charged uniform prices and gave poor service at the time of the adoption of the 1915 Act.
From the foregoing, it is apparent that, in the average cotton growing community, one gin can render the service for the community and two gins cannot be operated in such community without economic waste; that, when the 1915 law was adopted, a large proportion of the cotton communities had convenient access to only one gin, there was very little competition in price, and there was not sufficient competition in service to bring about the rendition of good ginning with adequate equipment and regular and proper weights. • '
I think it plainly appears that a cotton gin operator renders an indispensable service and, in the average cotton growing community, enjoys a practical monopoly, and that regulation of prices and service are necessary in order to afford cotton farmers good ginning at fair prices.
It follows then that the business of cotton ginning falls within that class of busiriesses which render a necessary and indispensable public service, which must enjoy a practical monopoly, absent regulation, in order to operate without economic waste, and which must be regulated in order to protect the patrons against exorbitant prices for poor and inadequate service.
It is my conclusion that, because of these essential characteristics which inhere in the business of cotton ginning in Oklahoma and the peculiar relation it bears to the public, the owners thereof havq devoted such business to the public and i.t has become “affect*851ed with a public interest” and subject to regulation as to character of service to be rendered and price to be charged therefor.