CLASS the state from certain producers for the purpose of shipping the same to New York City for consumption or manufacture without having been duly licensed as provided by sections 55 and following of the Agricultural Law (Consol. Laws, c. 1), added thereto by chapter 408 of the Laws of 1913, as amended

5. CONSTITUTIONAL LAW 208(1) LEGISLATION-EQUAL PROTECTION. There is no constitutional prohibition against class legislation as such if the classification is based on some reasonable ground and is not essentially arbitrary; only where there is no real distinction on a substantial basis can it be said that the equal protection of the laws is denied. 6. CONSTITUTIONAL LAW 62-DELEGATION OF LEGISLATIVE POWER-COMMISSIONER OF by chapter 651 of the Laws of 1915. The AGRICULTURE. principal provisions of the statute are as follows:

"The bond required to be filed hereunder shall be given to the commissioner of agriculture in his official capacity and shall be conditioned for the faithful compliance by the licensee with *Walter Jeffreys Carlin, of New York City, the provisions of this chapter, as hereby amendfor respondent.

*422

cream, which *payment is secured by a bond or the deposit of money or securities as hereinbe

To summarize the principal features of the enactment:

fore provided for, the creditor may file with the tion shall, as a business, buy milk or cream (1) No person, firm, association, or corpora

commissioner of agriculture, upon a form pre

scribed by him, a verified statement of his within the state from producers for the purclaim. If such creditor shall have reduced such pose of shipping the same to any city for claim to judgment or shall thereafter and before

the commencement of the action by the commis- consumption or manufacture without having: sioner of agriculture, as hereinafter provided (a) An established office within the state; for, reduce such claim to judgment, a transcript and (b) a license. of such judgment shall also be filed with such commissioner.

(2) No such person, firm, association, or

*424

"After the expiration of ninety days from the termination of any license period the commis- corporation *may obtain a license without: sioner of agriculture shall, by proper action (a) Satisfying the commissioner of agriculwherein all such creditors and any surety upon ture of his character and financial responsiany bond given as herein before provided for and

the licensee shall be parties, proceed to deter- bility; (b) either giving a surety company mine the amount due each such creditor, and bond of not less than $5,000 or more than the judgment rendered in such action shall be $100,000, or making a deposit of money or seenforced ratably for such creditors against the surety on the bond, if one there be, or against curities; or (c) if an individual or a domestic the moneys or securities deposited as hereinbe- corporation, satisfying the commissioner that fore provided for. he "is solvent and possessed of sufficient as"A person or corporation licensed hereunder sets to reasonably assure compensation to shall make a verified statement of his or its disbursements during a period to be prescribed probable creditors." by the commissioner of agriculture, containing the names of the persons from whom such products were purchased, and the amount due to the vendors thereof. Such statement shall be submitted to the commissioner of agriculture when requested by him and shall be in the form prescribed by such commissioner. If it appears from such statement or other facts ascertained by the commissioner of agriculture, upon inspection or investigation of the books and papers of such licensee as authorized by section fiftysix of this chapter, that the security afforded to persons selling milk and cream to such licensee by the bond executed or deposit made by such licensee as herein provided does not adequately protect such vendors, the commissioner of agri*423

(3) On default of payment by a licensee of money due for the purchase of milk and cream, the commissioner shall apply the security to the extinguishment of the claims of creditors filed with him. It

Defendant is a domestic corporation. demurred to each of the 298 causes of action set forth in the complaint on the ground that the facts stated do not constitute a cause of action, and moved for judgment on the pleadings. At the Special Term the motion was denied, but the Appellate Division reversed the order denying the motion, and dismissed the complaint, one justice dissenting culture may require such licensee to give an adand one not voting, on the ground "that the ditional bond or to deposit additional moneys or securities, to be executed or deposited as purpose of the statute is to secure payment above provided, in a sum to be determined by for the purchase price of merchandise, and the commissioner, but not exceeding by more is class legislation, and not a valid exercise than twenty-five per centum the maximum amount paid out by such licensee to sellers of milk in any one month: Provided, however, that the maximum amount of the bond or deposit required from any applicant under the provisions of this section shall be one hundred thousand dollars; and that any applicant filing a bond or depositing money or securities in such maximum amount shall be exempted from filing either the statements of milk purchased, or the statements of disbursements in this section provided for.

of the police power."

[1] Does an action lie to recover a penalty for violation of section 55 of the Agricultural Law? Section 61 as added by Laws 1913, c. 408, provides that:

"Any person who * not being licensed, shall conduct the business of buying milk for shipment as provided in section 55, * shall be guilty of a misdemeanor."

"If the applicant for a license under this sec- But the Agricultural Law (section 52) also tion be a person or a domestic corporation, the provides for penalties to be collected in a civcommissioner of agriculture may, notwithstanding the provisions of this section, if satisfied il action. "Every person violating any of the from an investigation of the financial condition provisions of this chapter, shall forfeit to the of such person or domestic corporation that such people of the state of New York the sum of person or corporation is solvent and possessed not less than fifty dollars nor more than one of sufficient asests to reasonably assure compen

sation to probable creditors, by an order filed hundred dollars for

in the department of agriculture, relieve such person or corporation from the provisions of this section requiring the filing of a bond.

the first violation."

*425

"The term station' or 'milk-gathering sta- *When sections 55 to 61 became a part of tion,' as used in this and the ensuing sections "this chapter" (Laws 1909, c. 9, being chapter of this article, shall include an established office 1 of the Consolidated Laws, known as the where the business of buying milk or cream as

herein provided is carried on, with or without Agricultural Law) the provisions of section a place or premises in connection therewith for 52 applied automatically to violations therethe physical handling of milk or cream." obvious inconsistencies of, except where

arose.

Far from being an inconsistency, it is in entire harmony with the general purpose of the Agricultural Law to provide both criminal and civil liability for violations of its provisions.

[2] Is a violation of the provisions of section 55 charged in the complaint? The grievance to be complained of is not each act of purchasing, but the act of conducting the business of purchasing. The complaint charges in 298 separate counts that on or about a certain date, each count setting forth a different date, defendant bought milk or cream from certain producers without having been duly licensed. Each count must be read separately as if it were the only count. The complaint does not allege that at any time defendant carried on the business of purchasing milk or cream. Carrying on the business within the terms of the statute implies continuity of conduct in that respect, a continuous course of dealing, not an isolated transaction. Penn Collieries Co. v. McKeever, 183 N. Y. 98, 75 N. E. 935, 2 L. R. A. (N. S.) 127; People ex rel. Allen v. Whiting, 68 Misc. Rep. 306, 123 N. Y. Supp. 769. Section 52 of the Agricultural Law provides for separate penalties for separate acts of selling, exposing for sale, using and the like, but no provision is made for cumulative penalties in case the purchasing is carried on or continued from day to day. The offense of carrying on the business in violation of the statute should alone be pleaded, and one penalty sued for. People v. Spencer, 201 N. Y. 105, 94 N. E. 614, Ann. Cas. 1912A, 818. The complaint does not state facts constituting 298 causes of action, neither does it state facts constituting one cause of action. Defendant's demurrer should accordingly be sustained, and this opinion might end at this point.

*426

*We are asked, however, to pass upon the constitutionality of the statute. Courts often say that they will withhold a decision on the constitutionality of a statute until it becomes unavoidable for the determination of the case (Hanrahan v. Terminal Station Com. of Buffalo, 206 N. Y. 494, 504, 100 N. E. 414), but it seems like an anticlimax to the careful presentation of this appeal on constitutional grounds to dispose of it temporarily as a mere matter of the wording of the complaint. Defendant urges that this is a statute to compel the payment of indebted ness; that nothing in the business of purchasing milk or cream carries with it any special necessity for imposing unusual burdens upon those who carry it on; that the statute has no relation to the public health, morals, safety, or convenience, nor any great public need; that it is unmistakably and

palpably in excess of the legislative power; that it violates the due process clauses of the state and federal Constitutions; that it is also objectionable as "class legislation," and because it delegates legislative power to the commissioner of agriculture. Plaintiff, on the other hand, contends that, as harmful business may be prohibited, so useful businesses may be regulated when the public interests will be thereby subserved; that a useful business may, by reason of local conditions or customs, prove a menace to the public welfare; that it must be presumed that this business has fittingly come under. the the legislative eye and rule for the reason that, when unrestricted, it had become, or threatened to become the cause of more than ordinary loss to a considerable class in the community, and that the manner of regulation is a matter of legislative discretion.

To hold a statute unconstitutional is a grave thing to do. To refuse, by so doing, to recognize a demonstrated evil and to characterize the unusual in legislation as impossible is unwise. Constitutional law is "to a certain extent, a progressive science" *427

(Holden v. Hardy, 169 *U. S. 366, 385, 18 Sup. Ct. 383, 42 L. Ed. 780), and the courts have become more cautious "about pressing the broad words of the Fourteenth Amendment to a drily logical extreme." Noble State Bank v. Haskell, 219 U. S. 104, 110, 31 Sup. Ct. 186, 187 (55 L. Ed. 112, 32 L. R. A. [N. S.] 1062, Ann. Cas. 1912A, 487).

[3] So many decisions of the courts of this state and of the United States have dealt with the question of legislative power that only a few of the most recent will be considered. We may begin with the proposition that the state may not prohibit the lawful, common, and ordinary business of purchasing milk or cream (People ex rel. Tyroler v. Warden, etc., 157 N. Y. 116, 51 N. E. 1006, 43 L. R. A. 264, 68 Am. St. Rep. 763; Fisher Co. v. Woods, 187 N. Y. 90, 79 N. E. 836, 12 L. R. A. [N. S.] 707; Adams v. Tanner, 244 U. S. 590, 37 Sup. Ct. 662, 51 L. Ed. 1336, L. R. A. 1917F, 1163, Ann. Cas. 1917D, 973), but it may regulate a business, however honest in itself, if it may become a medium of fraud. It is not enough to say that the business may be honestly conducted. The state may, to some extent, compel honesty by imposing a license fee if widespread frauds upon and losses by its people are thereby prevented. Any trade, calling, or occupation may be reasonably regulated if “the general nature of the business is such that unless regulated many persons may be exposed to misfortunes against which the Legislature can properly protect them." Alien v. Riley, 203 U. S. 347, 27 Sup. Ct. 95, 51

that which seems vain and capricious to one
generation may become the wisdom of the
next. But it is urged that so much of this
statute as aims to compel certain purchas.
ers of milk to pay their debts, measured by
the standards of the obligations of the state
to its citizens as we now understand them,
is a hateful interference with the freedom
of men to transact ordinary business, not af-
fected with a public interest, with other men

bad debts may be secured or prevented by the
exercise on the part of the state of its pow-

L. Ed. 216, 8 Ann. Cas. 137; Brazee v. Mich-
igan, 241 U. S. 340, 343, 36 Sup. Ct. 561, 60
L. Ed. 1034, Ann. Cas. 1917C, 522. Passing
from the general to the particular, the con-
stitutionality of the "Blue Sky Laws" of
Ohio and other states, which require dealers
in corporate stocks and other securities to
be licensed, has been upheld. Hall v. Geiger-
Jones Co., 242 U. S. 539, 37 Sup. Ct. 217, 61
L. Ed. 480, L. R. A. 1917F, 514, Ann. Cas.
1917C, 643; Caldwell v. Sioux Falls Stock- as they see fit; that its implication is that
yards Co., 242 U. S. 559, 37 Sup. Ct. 224, 61
L. Ed. 493; Merrick v. Halsey & Co., 242 U.
S. 568, 37 Sup. Ct. 227, 61 L. Ed. 498. The
evils of "get-rich-quick" schemes called for
protection against the frauds of unscru-
pulous dealers. Licenses may be required
for employment agencies. Brazee v. Mich-
igan, supra; People ex rel. Armstrong v.
Warden, etc., 183 N. Y. 223, 76 N. E. 11, 2
L. R. A. (N. S.) 859, 5 Ann. Cas. 325. The
business of banking by individuals and part-
nerships has been held subject to license
*428

#429

er to regulate *trades and callings; that
this is a doctrine of paternalism in direct
conflict with our judicial notion of liberty
under the Constitution. Schnaier v. Navarre
H. & I. Co., 182 N. Y. 83, 74 N. E. 561, 70
L. R. A. 722, 108 Am. St. Rep. 790; People
ex rel. Wineburgh Adv. Co. v. Murphy, 195
N. Y. 126, 88 N. E. 17, 21 L. R. A. (N. S.) 735;
People v. Ringe, 197 N. Y. 143, 90 N. E.
451, 27 L. R. A. (N. S.) 528, 18 Ann. Cas.
N. Y. 1, 90 N. E. 1140, 27 L. R. A. (N. S.) 357,
474; People ex rel. Duryea v. Wilber, 198
19 Ann. Cas. 626; People ex rel. Moskowitz
v. Jenkins, 202 N. Y. 53, 94 N. E. 1065, 35

(Musco v. United Surety *Co., 196 N. Y. 459,
465, 90 N. E. 171, 134 Am. St. Rep. 851; Engel
v. O'Malley, 219 U. S. 128, 31 Sup. Ct. 190,
55 L. Ed. 128) "because fraud could be prac-
ticed in it." The business of selling patent. R. A. (N. S.) 1079; Hauser v. No. Brit-
rights, being peculiarly one in which fraud
ish & M. Ins. Co., 206 N. Y. 455, 100 N. E
may be practiced, may be regulated. Allen v.
Riley, supra.
Even "ice cream" may be 52, 42 L. R. A. (N. S.) 1139, Ann. Cas. 1914B,
standardized by state Legislatures in order
that consumers may not be misled (Hutchin-
son Ice Cream Co. v. Iowa, 242 U. S. 153, 37
Sup. Ct. 28, 61 L. Ed. 217, Ann. Cas. 1917B,
643), and a standard size of bread loaves
may be fixed (Schmidinger v. City of Chica-
go, 226 U. S. 578, 33 Sup. Ct. 182, 57 L. Ed
364, Ann. Cas. 1914B, 284).

But all these statutes and many others
have for their legitimate object the preven-
tion of frauds, rather than the collection of
debts through the agency of the state. This
statute points to protection from the prob-
ability of financial loss rather than fraud,
and goes far beyond any mere licensing
statute by requiring the licensee to give se-
curity for payment of his debts to purchas-
ers. The business regulated is not done with
ignorant people, the chosen and easy prey
of the cunning and unscrupulous impostor.
It is done with men of ordinary intelligence,
fully conscious of what they are about. "The
state must adapt its legislation to evils as
they appear." McKenna, J., in Merrick v.
Halsey & Co., supra. If the Legislature can
check impending ills before they become no-
torious, the courts should not say that it
has acted too soon. As suggested by Klein
v. Maravelas, 219 N. Y. 383, 114 N. E. 809,
L. R. A. 1917E, 549, Ann. Cas. 1917B, 273,

263.

The

[4] The question is not presented wheth
er the statute is valid as an exercise of the
police power of the state over individuals;
nor is the determination of that question
essential to the decision of this case.
question here is whether the defendant, a
domestic corporation, is affected by the al-
leged unconstitutionality of the statute in
the features complained of. If it is not, it
cannot complain. Jeffrey Manfg. Co. v.
Blagg, 235 U. S. 571, 576, 35 Sup. Ct. 167,
59 L. Ed. 364; Cusack Co. v. City of Chica-
go, 242 U. S. 526, 530, 37 Sup. Ct. 190, 61 L.
Ed. 472, Ann. Cas. 1917C, 594.

[5] Whatever might be said of the statute
as "class legislation" (State v. Latham, 115
Me. 176, 98 Atl. 578, L. R. A. 1917A, 480,
Supreme Judicial Court of Maine, Septem-
ber 8, 1916) is answered by People v. Havnor,
149 N. Y. 195, 205, 43 N. E. 541, 544 (31 L.
R. A. 689, 52 Am. St. Rep. 707). The stat-
ute there under consideration placed barbers
in a class by themselves, and then subdivid-
ed the class between barbers in New York
and Saratoga and barbers elsewhere for the
purpose of regulating their right to work on
Sunday; but Vann, J., said:

the same localities
"The statute treats all barbers alike within
under like circum-
stances and conditions.

*

#431

There is no constitutional prohibition 81, a statute provided that "it shall be un against class legislation as such if the classification is based on some reasonable ground, and is not essentially arbitrary. The statutes are replete with instances where the Legislature has selected a class of persons for regulation. People v. Klinck Packing Co., 214 N. Y. 121, 137, 108 N. E. 278, Ann. Cas. 1916D, 1051. It is only where there is no real distinction on a substantial basis that it can be said that the equal protection

*430

of the laws is denied. Gulf, Col. & S. *F. Ry. v. Ellis, 165 U. S. 150, 17 Sup. Ct. 255, 41 L. Ed. 666; Southern Ry. Co. v. Greene, 216 U. S. 400, 30 Sup. Ct. 287, 54 L. Ed. 536, 17 Ann. Cas. 1247; Lindsley v. Natural Car. Gas Co., 220 U. S. 61, 31 Sup. Ct. 337, 55 L. Ed. 369, Ann. Cas. 1912C, 160.

lawful for any person, corpora*tion or association of persons to maintain or operate any college, school or institution" where both whites and negroes were taught. Recognizing the power of the Legislature to so amend the charter of Berea College or of all domestic corporations, the test applied was whether the law would have been enacted as to corporations alone had it appeared that it would be invalid as applied to the privileges of individuals, and it was held that the fact that corporations were separately mentioned in the act justified the inference that the statute was separable and was to be so construed as to be upheld as to corporations under the reserved power to amend corporate charters. "The act itself, being separable, is [6] Nor can it be said that the power vest- to be read as though it in one section proed in the commissioner of agriculture to hibited any person, in another section any waive the requirement of a bond or other corporation, and in a third any association security in certain cases is a delegation of of persons to do the acts named. Reading the legislative power. He is not left "without statute as containing a separate prohibition check or guidance." The Legislature has on all corporations, at least, all state corfurnished the rule; the commissioner merely porations, it substantially declares that any applies it. His determination is subject to authority given by previous charters to injudicial review. Section 58, as added by struct the two races at the same time and in Laws 1913, c. 408. In People v. Klinck Pack- the same place is forbidden, and that prohiing Co., supra, the provisions of the statute bition, being a departure from the terms of exempted from the application of the hours the original charter in this case, may propof rest law certain employés, "if the com- eriy be adjudged an amendment." 211 U. S. missioner of labor in his discretion ap- 1. 57, 29 Sup. Ct. 35, 53 L. Ed. 81. The disproves." Those words were held to have the senting opinion of Harlan, J., emphasizes the vice of vesting the commissioner with the distinction between persons and corporations power wholly at his volition to suspend the made by the prevailing opinion. It charac operation of the statute. The Legislature terizes the effect of the decision as making here prescribes the regulations which are to a law in violation of the legislative intent be enforced according to the legal discretion and against the fair presumption that equalof the commissioner. Brazee v. Michigan, ity of treatment was intended. Corporations supra. Nor does it appear that defendant has applied for and failed to obtain a license without giving a bond. Lehon v. City of Atlanta, 242 U. S. 53, 37 Sup. Ct. 70, 61 L. Ed. 145.

are separately named in the act before us repeatedly and with sedulous care, and the act is not distinguishable in that respect from the case cited. N. Y. C. & H. R. R. R. Co. v. U. S., 212 U. S. 481, 497, 29 Sup. Ct. 304, 53 L. Ed. 613; Citizens' Ins. Co. v. Clay (D. C.) 197 Fed. 435.

In New York C. & H. R. R. R. Co. v. Williams, 199 N. Y. 108, 116, 92 N. E. 404, 407 (35 L. R. A. [N. S.] 549, 139 Am. St. Rep. $50), this court, in dealing with the provi

[7-9] Is the statute good as the exercise of the lawful power of the state over a domestic corporation? As a corporation created by this state, defendant has no natural right to purchase milk without obtaining a license on such terms as the state directs. Corporate charters may be altered or repealed. Const. of N. Y. art. 8, § 1. Under the guise of an amendment to corporate charters the sions of the Labor Law requiring payment Legislature may not defeat or substantially of employés of certain classes of corporaimpair the object of the grant, the right of the corporation to transact business, but it

may qualify it by reasonable restrictions. Sutton v. New Jersey, 244 U. S. 258, 37 Sup. Ct. 508, 61 L. Ed. 1117; Noble State Bank V. Haskell, 219 U. S. 104, 110, 31 Sup. Ct. 186, 55 L. Ed. 112, 32 L. R. A. (N. S.) 1062, Ann. Cas. 1912A, 487. In Berea College v. Kentucky, 211 U. S. 45, 29 Sup. Ct. 33, 53 L. Ed.

*432

tions and persons in cash and on the 1st and
the Berea College Case. It said:
15th of the month, approved the doctrine of

questioned here by any individuals;
"The constitutionality of the statute is not
and, even if the enactment should be deemed
unconstitutional so far as persons are concern-
ed, the provision relating to them is readily sep-
arable from the rest of the statute relating to
corporations and its invalidity in this respect,