Di Santo v. Commonwealth of Pennsylvania/Opinion of the Court

Plaintiff in error was indicted in the court of quarter sessions of Deuphin county, Pennsylvania, for a violation of an Act of the Legislature of July 17, 1919 (P. L. 1003) as amended by the Act of May 20, 1921 (P. L. 997; Pa. St. Supp. 1924, § 20197), requiring licenses to sell steamship tickets or orders for transportation to or from foreign countries. The indictment alleged that, December 14, 1921, without having obtained a license so to do, plaintiff in error held himself out as authorized to sell tickets and orders for transportation as agent of certain steampship companies, and that he engaged in the sale of such tickets. There was no controversy as to the facts, and, by direction of the court, the jury returned to verdict of guilty. Plaintiff in error, by motion in arrest of judgment, challenged the validity of the act on the ground that it contravenes the commerce clause of the federal Constitution. The court held the statute, valid, and sentenced him to pay a fine. On appeal the Superior Court held the act unconstitutional and reversed the judgment. The Supreme Court reversed the Superior Court and reinstated the judgment of the trial court. The case is here under section 237(a) of the Judicial Code (Comp. St. § 1214).

The act of 1921 provides that no person or corporation, other than a railroad or steamship company, shall engage within the state in the sale of steamship tickets or orders for transportation or shall hold himself out as authorized to sell such tickets or orders without having first procured a license. It requires every applicant to cause his application to be advertised in specified publications, to furnish proof that he is of good moral character and fit to conduct the business, to give a list of the steamship lines, not less than three, for which he is agent, and to file a bond in the penal sum of $1,000 conditioned that he will account to all interested persons for moneys received for tickets and orders and that he will not be guilty of any fraud or misrepresentation to purchasers. The license is granted on approval of the commissioner of banking and payment of a fee of $50, and may be renewed on payment of a like fee annually. The license may be revoked for fraud, misrepresentation or failure to account. Any person carrying on this business without license is declared guilty of a misdemeanor and liable to fine or imprisonment or both. The state Supreme Court declared that the act is one to prevent fraud, and held that it does not require an agent or servant of the steamship companies to have a license, but that plaintiff is not such an agent, and that he occupies a position in the nature of an independent contractor, and is required to obtain a license.

Plaintiff represented four steamship companies operating steamships between the United States and Europe. Each of them gave him a certificate authorizing him to sell, at a specified place in Harrisburg, tickets and orders for transportation entitling persons therein named to passage on such steamships, and required the certificate to be posted in his office. This is in accordance with the Pennsylvania act of 1863 (P. L. 582; Pa. St. 1920, §§ 18643-18648) regulating the display of certificates by steamship agents, and a copy of that act was printed on the certificate. The companies furnished plaintiff in error books of tickets having stubs on which to make record of tickets sold, advertising matter to be used by him, schedules of sailings, notices of cancellations of sailings, and information as to the immigration and customs services, and they authorized him to collect money for tickets sold. He usually received 25 per cent. of the price when applications were made for the tickets. He gave each company a bond to account, and transmitted immediately to his respective principals the amounts received by him.

The soliciting of passengers and the sale of steamship tickets and orders for passage between the United States and Europe constitute a well-recognized part of foreign commerce. See Davis v. Farmers' Co-operative Co., 262 U.S. 312, 315, 43 S.C.t. 556, 67 L. Ed. 996. A state statute which by its necessary operation directly interferes with or burdens foreign commerce is a prohibited regulation and invalid, regardless of the purpose with which it was passed. Shafer v. Farmers' Grain Co., 268 U.S. 189, 199, 45 S.C.t. 481, 69 L. Ed. 909, and cases cited. Such legislation cannot be sustained as an exertion of the police power of the state to prevent possible fraud. Real Silk Mills v. Portland, 268 U.S. 325, 336, 45 S.C.t. 525, 69 L. Ed. 982. The Congress has complete and paramount authority to regulate foreign commerce and, by appropriate measures, to protect the public against the frauds of those who sell these tickets and orders. The sales here in question are related to foreign commerce as directly as are sales made in ticket offices maintained by the carriers and operated by their servants and employees. The license free and other things imposed by the act on plaintiff in error, who initiates for his principals a transaction in foreign commerce, constitute a direct burden on that commerce. This case is controlled by Texas Transport Co. v. New Orleans, 264 U.S. 150, 44 S.C.t. 242, 68 L. Ed. 611, 34 A. R. L. 907, and McCall v. California, 136 U.S. 104, 10 S.C.t. 881, 34 L. Ed. 391.

Judgment reversed.

Mr. Justice BRANDEIS, with whom Mr. Justice HOLMES concurs, dissenting.