milk was undiluted when Murray picked it up. Murray had previously pled guilty to di- luting milk in a separate case. At trial, Dr. Ravey, health officer for the city of Burling- ton, testified that he had tested milk from Soules & White’s creamery and found it di- luted with water. Why testing at the cream- ery had not caught the diluted product is not explained in the decision. Field argued that his milk was sold by weight, not by quality, making dilution ir- relevant. The purpose of the law proscrib- ing dilution, according to Field, was limited to sales based on quality alone. The Court, speaking through Justice Harlan Slack, dis- agreed. The purpose of the statute was protection of the consumer. “Fraud and de- ceit not being an element of the offense charged, it is immaterial whether milk is sold by weight, measure, or quality.” Field claimed he didn’t know the milk was dilut- ed, that it was Murray who was at fault. But the Court found that he was guilty if he sold diluted milk, whether he knew about it or not. “In the instant case the sale of the milk was not consummated until it was delivered at the creamery; down to that moment it belonged to the respondent, was in his cus- tody, in the eye of the law, and he was re- sponsible for its condition. If it was diluted when delivered at the creamery, it is imma- terial whether it was diluted by the respon-
dent, or the person who did the milking, or the person who carried it to the cream- ery.”32
Henry Merriam weighed Horatio Nye’s
butter, reported a false weight to Nye by twenty to thirty pounds per firkin, and then paid Nye what he owed him based on the correct weight. Merriam had forgotten his originally-reported weight. Although Nye was paid on the correct weight, Nye sued Merriman for damages, claiming fraud. The Court turned him away, dismissing his claim for damages, concluding that a bad mea- sure, no matter how fraudulent in intention, was not actionable without actual damag- es.33
The Business of the Creamery
I. Glee Wheelock sued the directors of the Woodbury Co-operative Creamery Company, Inc., to collect a debt in 1931.34 Glee argued that the corporation had not been formed, and tried to hold the individ- ual stakeholders liable, as the president had failed to file a proper certificate with the secretary of state. The company answered that its president had filed the certificate, and that should suffice, certified or not. The Court affirmed the decision below in favor of the cooperative, explaining, “the real purpose of the Legislature in enacting this
statute was to provide a method by which prospective customers and patrons of the corporation could conveniently get reliable information regarding its financial stand- ing. This purpose was as effectively accom- plished by filing in the town clerk’s office the original certificate as by filing a certi- fied copy of it.” The farmers were not liable. This decision, and the statutes on which it was decided, clearly reflected the policy of favoring the producers. John Bessette purchased forty-eight
shares of the St. Albans Co-operative Creamery, Inc., in 1934, began supplying the creamery with milk, and then stopped, for reasons that are not entirely clear. The stock certificate repeated a bylaw of the corporation that failing to deliver milk for any reason would result in forfeiture of the stock. The farmer sued, and lost. The Court held that even if the statute failed to autho- rize bylaws regulating forfeiture, they can serve as enforceable contracts. “The con- tract was not void as being against public policy. It was wholly of private concern be- tween the plaintiff and the other members of the defendant in their corporate capac- ity.”35
Farmer James Learmouth wanted his money back from a cooperative. He said the people in charge had promised him a return of his investment if he was dissat- isfied, and he was dissatisfied. There was nothing in writing about that promise, but the stock certificates and the bylaws provid- ed that failing to deliver milk for any reason resulted in forfeiture of the investment, as in the Bessette case. The promise changed the result. The oral contract was upheld by the Supreme Court, in a 1938 decision, as the statute of frauds exempted contracts to buy stock. The company was made to repay the funds.36
The most cited creamery case is Clifford
v. West Hartford Creamery Co., Inc. (1936). This defined principles of priority among lienholders, enforcing an 1898 law that placed “patrons” at the front of the line for claims against the creamery. “Patrons” included the producers, the farmers. Oth- er creameries, who also sold cream to the creamery, were patrons, and stood behind the producers in collecting what was owed them. The Court explained the policy:
It is apparent that all of these acts we have considered have but one object in view—the protection of produc- ers of milk and cream in their dealings with creamery companies. That there was a necessity for such legislation is evident when it is borne in mind that the creamery companies and the pro- ducers do not deal with each other on equal terms; that the advantage has always been with the companies. It is the company that weighs the milk and
10 THE VERMONT BAR JOURNAL • WINTER 2013
www.vtbar.org
Ruminations: The Legal History of Vermont Butter
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