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necessary or not, a question we reserve, a requirement of such approval would not be an invalid delegation.**

3. Authorization of Coöperatives to Cast the Votes of Producer Patrons.-This objection, too, falls before the answering argument that inasmuch as Congress could place the Order in effect without any vote, it is permissible for it to provide for approval or disapproval in such way or manner as it may choose.

Coöperatives in the Equalization Fund.-The defendant, Central New York Coöperative Association, denies liability under Articles VI, VII and VIII of the Order on the ground that it is not liable to pay its net pool obligation into the administrative fund or to meet the expenses of administration. The asserted reason for its freedom from liability is that it is a coöperative composed of milk producers and distributes the milk of its members and others as agent.

expenses

The coöperative owns no farms. Its members are dairy farmers. By their contract they agree "to deliver. all . . . milk produced . . . which said milk is to be marketed and distributed by the [coöperative] The latter "agrees to pay . . . for the milk . . . a price. . . based upon the amount received . . . less the Nonmembers' milk is marketed under the same contract. The coöperative leases receiving and distributing facilities from a business corporation. The milk is received by the coöperative at receiving plants and shipped to the city depot. It distributes through other business corporations which are wholly-owned subsidiaries of the coöperative. These distributing subsidiaries use the leased physical facilities under verbal contracts with the coöperative. The coöperative receives the net amount from the sales and distributes to its patrons under license from the Director of the Division of

Milk Control of New York permitting the marketing in the manner described.

Section 8c (5) (A) authorizes an order to classify milk and fix minimum prices which all handlers shall pay for milk purchased from producers. Section 8c (5) (C) authorizes the equalization pool and the handlers' payment to this settlement fund. It is urged that coöperatives which merely act as agents for their members are not included in handlers purchasing from producers. This is said to be definitely shown by the provisions of § 8c (5) (F) providing that nothing contained in the subsection shall be construed to prevent a Capper-Volstead coöperative from making distribution to its "producers in accordance with the contract." The Order defines a handler as including a coöperative association "with respect to any milk received from producers at any plant operated by such association or with respect to any milk which it causes to be delivered" to other handlers. Under the provisions of the Order, Article VII, §§ 8 and 9, coöperative handlers as other handlers equalize their purchases. by payment into the producer settlement fund, even though they are not required to pay the uniform price to their producers by reason of the exception of Article VII, § 1, and the provisions of § 8c (5) (F), as explained at page 561.

Coöperative contracts are of two general types, sale and agency.65 The Central New York Coöperative operates

under the agency type.

It is obvious that the use of the word "purchased" in the Act, § 8c (5) (A) and (C), would not exclude the "sale" type of coöperative. When § 8c (5) (F) was drawn, however, it was made to apply to both the "sale" and "agency" type without distinction. This would indicate there had been no intention to distinguish between the two types by (A) and (C). The section which au

65

Hanna, Law of Coöperative Marketing Associations, pp. 210, 256.

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thorizes all orders, § 8c (1), makes no distinction. The orders are to be applicable to "processors, associations of producers, and others engaged in the handling" of commodities. The reports on the bill show no effort to differentiate. Neither do the debates in Congress. The statutory provisions for equalization of the burdens of surplus would be rendered nugatory by the exception of "agency" coöperatives. The administrative construction has been to include such organizations as handlers."7 With this we agree. As here used the word "purchased" means "acquired for marketing." Subsection (A) cannot be construed as freeing agents, coöperative or proprietary, from the requirement to account at the minimum prices for milk handled.

As a corollary the contention is made also by Central Coöperative that no coöperative may be required to pay its surplus receipts over uniform prices into the equalization fund. This, too, is based upon a construction of § 8c (5)(F) as permitting a coöperative to make settlement with its members in accordance with the terms of its own contract with them. If the coöperative members were freed of the burden of carrying their proportion of milk going to manufacturing use, the discrimination in their favor would be most strongly marked. Such a construction is not required. Coöperatives are covered by § 8c (1) and (5) (A) and (B), and by the provisions of the Order, except as to the payment of the uniform price. Any payments below the uniform price fall on their members. We are of the view that the administrative construction is correct and that the "net proceeds" of (F) refer to the result of the coöperative sales in the marketing area after complying with the equalization requirements.

"House Report No. 1241, 74th Cong., 1st Sess.; Senate Report No. 1011, 74th Cong., 1st Sess.

Costanzo v. Tillinghast, 287 U. S. 341, 345; United States v. Chicago North Shore R. Co., 288 U. S. 1, 13-14.

The defendant, Central New York Coöperative Association, raises for itself a final point. In determining the net pool obligation of any handler for milk received from producers," the handler is authorized to subtract pro rata out of each class from the milk involved in the pool "the quantity of milk received from the handler's own farm." We have determined that this coöperative, though marketing milk under an agency contract with its members, is a handler subject to the Act and Order. The coöperative argues that as its members, farmers, would not need to account to the pool for their personal sales to consumers, the coöperative, being utilized as an agent to market the farmers' milk, is under no obligation to contribute to equalization. As the coöperative does not have its own farm but is itself a handler under the Act, it must pay into the producer settlement fund.

Inasmuch as all the defendants in these appeals are handling milk in interstate commerce, the petition for the enforcement of Official Order No. 126, issued under c. 383 of the Laws of 1937 of the State of New York, concerning milk not covered by Order No. 27 of the Secretary of Agriculture, should be dismissed.

The order of the District Court in Nos. 771, 827 and 828 is reversed and the causes are remanded to that Court with instructions to enter an order specifically enforcing up to the time of suspension the provisions of Order No. 27, issued by the Secretary of Agriculture August 15, 1938, regulating the handling of milk in the New York marketing area, as to all the defendants and enjoining defendants, their officers, agents and servants, from further violation of the Order.

The order of the District Court in dismissing the petition of Holton V. Noyes, as Commissioner of Agriculture and Markets of the State of New York, is affirmed.

08

Article VI, § 1.

[Over.]

MCREYNOLDS and BUTLER, JJ., dissenting. 307 U.S.

MR. JUSTICE BLACK and MR. JUSTICE DOUGLAS concur in the judgment and opinion of the Court except insofar as the opinion appears to imply that power of Congress to enact the marketing law depends upon the use and nature of milk. They do not believe that we are called upon in this case to indicate, as they think we do, that there is such a constitutional limitation on the power of Congress to regulate interstate commerce.

MR. JUSTICE MCREYNOLDS and MR. JUSTICE BUTLER, dissenting.

We are of opinion that the decree below should be affirmed.

In our view the challenged order of the Secretary must succumb to two manifest objections. It is unnecessary for us to dissect the record in search of other impedi

ments.

First. Congress possesses the powers delegated by the Constitution-no others. The opinion of this Court in Schechter Poultry Corp. v. United States (1935), 295 U. S. 495-noteworthy because of modernity and reaffirmation of ancient doctrine-sufficiently demonstrates the absence of Congressional authority to manage private business affairs under the transparent guise of regulating interstate commerce. True, production and distribution of milk are most important enterprises, not easy of wise execution; but so is breeding the cows, authors of the commodity; also, sowing and reaping the fodder which inspires them.

Second. If perchance Congress possesses power to manage the milk business within the various states, authority so to do cannot be committed to another. A cursory examination of the statute shows clearly enough the design to allow a secretary to prescribe according to his own errant will and then to execute. This is not government by law but by caprice. Whimseys may displace deliber