Carter v. Carter Coal Company

SCOTUSCase
Litigants=Carter v. Carter Coal Company
ArgueDate=March 11
ArgueYear=1936
DecideDate=May 18
DecideYear=1936
FullName=Carter v. Carter Coal Company
USVol=298
USPage=238
Citation=56 S.Ct. 855; 80 L.Ed. 1160
|Holding=The court found that the Coal Conservation Act is not within Congress’ power according to the Commerce Clause. Just because a commodity will, in the future, be sold in interstate commerce does not give Congress the right to regulate it before the event occurs.
SCOTUS=1932-1937
Majority=Sutherland
JoinMajority= Butler, McReynolds, Roberts, Van Devanter
Dissent=Cardozo
JoinDissent=Brandeis, Stone
Dissent2=Hughes
LawsApplied=U.S. Const. art. I, , cl. 3, U.S. Const. amend. X

"Carter v. Carter Coal Company", 298 U.S. 238 (1936), is a United States Supreme Court decision interpreting the Commerce Clause of the United States Constitution, which permits the United States Congress to "regulate Commerce... among the several States." Specifically, it analyzes the extent of Congress’ power, according to the Commerce Clause, looking at whether or not they have the right to regulate manufacturing.

Facts

The Bituminous Coal Conservation Act was passed in 1935 and replaced the previous codes set forth by the National Industry Recovery Act (NIRA). The new act established a commission, made up of coal miners, coal producers, and the public, to establish fair competition standards, production standards, wages, hours, and labor relations. All mines were required to pay a 15% tax on coal produced. The act was not mandatory, but mines that complied would be refunded 90% of the 15% tax.

James W. Carter was a shareholder of the Carter Coal Company and did not feel that the company should join the government program. The board of directors for the company thought that the company could not afford to pay the tax and not receive anything back. Carter sued the coal mine claiming that coal mining was not interstate commerce and therefore could not be regulated by the federal government.

Legal question

Does the United States Congress have the power, according to the Commerce Clause, to regulate the coal mining industry?

Majority opinion

The majority reasoned as follows:

a) Just because a commodity is manufactured or produced within a state and is intended for interstate commerce, does not mean that its “production or manufacturing is subject to federal regulation under the commerce clause.” b) A commodity that is meant to be sold in interstate commerce is not considered to be part of interstate commerce “before the commencement of its movement from the state.”

c) “Mining is not interstate commerce.” It is a local business and is subject to local control and taxation.

d) "The word 'commerce' is equivalent to the phrase 'intercourse for the purposes of trade'”: the process of mining coal does not fit within this definition.

e) The labor board has powers over production, not commerce. This confirms the idea that production is a purely local activity.

f) If the production of coal by a single person does not have a direct effect on interstate commerce, then the production of coal by many people can also not have a direct effect on interstate commerce. g) The evils that Congress sought to control are “all local evils over which the federal government has no legislative control."

h) “The federal regulatory power ceases when interstate commerce ends; and, the power does not attach until interstate commercial intercourse begins.”

Dissenting opinion

Justice Cardozo, dissenting, claimed that the price-fixing provision of the Coal Conservation Act was within Congress’s power because it had a direct effect on interstate trade.

Main points of the case

The court points out that the issues that Congress is trying to regulate, according to the Bituminous Coal Conservation Act, is the production of coal, not commerce. Also, they make it clear that the flow of goods has not begun when coal is still being produced. Therefore, there is not a current of commerce. Third, the direct versus indirect test was used and the court found that the production of coal does not have a direct effect on interstate commerce. Lastly, the issue of whether or not the production of coal could be categorized as an “evil” was discussed. It was determined that, in this case, the production of coal is a local evil. Congress doesn’t have the right to regulate all evils, just national ones.

ee also

*List of United States Supreme Court cases, volume 298

References

Epstein, Lee, and Thomas G. Walker. Constitutional Law for a Changing America: Institutional Powers and Constraints. 6th ed. Washington D.C.: CQ P, 2007. 448-450.

External links

*
* [http://supct.law.cornell.edu/supct/html/historics/USSC_CR_0298_0238_ZS.html Text of the opinion from Cornell University's Legal Information Institute]
* [http://www.oyez.org/cases/1901-1939/1935/1935_636/ short overview of the case and facts]