UNITED FUEL GAS COMPANY
v.
HALLANAN, STATE TAX COMMISSIONER OF THE STATE OF WEST VIRGINIA, ET AL.

U.S. | 1921-12-12
No. 276
Mr. Justice Brandéis dissents., Mr. Justice Clarke also dissents as to the jurisdictional question.
257 U.S. 277 Supreme Court of the United States (1921) Caution
Also reported at: 66 L. Ed. 234 · 42 S. Ct. 105 · 1921 U.S. LEXIS 1340 · SCDB 1921-034
Cited by 52 cases

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Synopsis

United Fuel Gas Company challenged a West Virginia statute that taxed the transportation of natural gas by pipeline on the grounds that most of the gas it transported was destined for interstate commerce and therefore outside the state's taxing authority. The Supreme Court reversed the state court's decision and held the statute unconstitutional as applied to the company because the predominant and actual course of the gas transportation extended beyond the state line, making it interstate commerce beyond West Virginia's regulatory reach.

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Opinion of the Court
Mrí'Justice Holmés

Mrí'Justice Holmés delivered the opinion of the court.

This is a bill in equity that seeks to restrain the-application to the plaintiff of the same statute that has been considered,in Eureka Pipe Line Co. v. Hallanan, just decided, ante, 265. Acts of Extraordinary Session, 1919, c. 5. The statute taxes the transportation of natural gas as well as of oil by pipe lines and the plaintiff Gas Company makes the same objection that was made by the Oil Company in the former case to the constitutionality of the act, as well as others that it will not be necessary to discuss. The two cases were heard together and were disposed of in a single opinion by the Supreme Court of Appeals. The Circuit Court of the State held the statute void, but the Supreme Court, as before, upheld it as valid with regard to intrastate business “as above defined” and defined the plaintiff’s business as intrastate. The plaintiff drew in question the validity of the statute “ as construed and applied,” Merchants’ National Bank v. Richmond, 256 U. S. 635, and took' this writ of error. It also filed a petition for a writ of certiorari. For the reasons given in the Eureka Case the writ of error will be entertained and the petition for certiorari dismissed.

The case was heard upon the pleadings and a stipulation as to facts. It appears that the plaintiff gathers and purchases natural gas, mostly in West Virginia, and distributes it through its pipes which extend to or beyond the State line in various places and also connect with the pipes of other companies that extend beyond the State. The total amount dealt with by the plaintiff in the year ending July 1,1919, was 54,973,588 M cubic feet of which all but a little over a million M cubic feet was gathered in West Virginia. ‘ There were sold directly to consumers in West Virginia 11,590,656 M cubic feet; a little over 10,000,000 M cubic feet to consumers in other States; and the remainder'was sold to four connecting companies. It is admitted that the gas sold to one of these, the Ohio Fuel Supply Company, is transported in interstate commerce, so that that may be laid on one side. Another of them is the Columbia Gas & Electric Company. Ninetynine per cent, of the gas received by it is carried out of the State and sold, yearly. A third is the Pittsburgh-West Virginia Gas Company which yearly disposes of eighty-eight per cent, of the gas in the same way. The fourth is the Hope Natural Gas Company, which in like manner carries sixty-seven per cent, of the gas bought from the plaintiff out of the State and sells it there.

In short the great body of the gas starts for points outside the State and goes to them. That the necessities of business require a much smaller amount destined to points within the State to be carried undistinguished in the same pipes does not affect the character of the major transportation. Neither is the case as to* the gas sold to the three companies changed by the fact that the. plaintiff, as owner of the gas, and the purchasers after they receive it might change their minds before the gas leaves the State and that the precise proportions between local and outside deliveries may not have been fixed, although they seem to have been. The typical and actual course of events marks the carriage of the greater part as commerce among the States and theoretical possibilities may be left out of account. There is no break, no period of deliberation, but a steady flow ending as contemplated from the beginning beyond the state line. Ohio R. R. Commission v. Worthington, 225 U. S. 101, 108. United States v. Reading Co., 226 U. S. 324, 367. Western Union Telegraph Co. v. Foster, 247 U. S. 105, 113. We have menr tioned only such, facts as are sufficient for our decision, and have not'noticed other objections urged against the law. What-iye have' stated seems to us enough to con-, demn it as applied to this case.

Decree reversed.

Petition jor certiorari dismissed.

Mr. Justice Brandéis dissents.

Mr. Justice Clarke also dissents as to the jurisdictional question.

Cases With Similar Vibessemantic neighbors from the corpus

Citator

Cited By (18 total)

  • Stafford v. Wallace, 258 U.S. 495 (U.S. 1922)
    …s a violation of the commerce ciause.- Similar confirmation of the principle of the Swift Case is to be found in Dahnke-Walker Milling Co. v. Bondurant, 257 U. S. 282; Eureka Pipe Line Co. v. Hallanan, 257 U. S. 265; United Fuel Gas Co. v. Hallanan, 257 U. S. 277; Western Union Telegraph Co. v. Foster, 247 U. S. 105, 113; United States v. [*520] Reading Co., 226 U. S. 324, 367, 368; Ohio Railroad Commission v. Worthington, 225 U. S. 101, 108; and Loewe v. Lawlor, 208 U. S. 274, 301. It is manifest that Cong…
    1 / 2
  • Commonwealth of Pa. v. State of W. Va., 262 U.S. 553 (U.S. 1923)
    …s, obstructs or burdens such transmission is a regulation of interstate commerce, — a prohibited interference. West v. Kansas Natural Gas Co., 221 U. S. 229; Public Utilities Commission v. Landon, 249 U. S. 236, 245; United Fuel Gas Co. v. Hallanan, 257 U. S. 277; Dahnke-Walker Milling Co. v. Bondurant, 257 U. S. 282, 290-291; Lemke v. Farmers Grain Co., 258 U. S. 50; Western Union Telegraph Co. v. Foster, 247 U. S. 105; Minnesota v. Barber, 136 U. S. 313; Brimmer v. Bebman, 138 U. S. 78. The West Virginia a…
  • Bd. of Trade of the City of Chicago v. Olsen, 262 U.S. 1 (U.S. 1923)
    …re crossing state lines, prevented the great bulk of the oil and gas which did thereafter cross state lines from being a stream or current of interstate commerce. Eureka Pipe Line Co. v. Hallanan, 257 U. S. 265, 272; United Fuel Gas Co. v. Hallanan, 257 U. S. 277, 281. It is impossible to distinguish the case at bar, so far as it concerns the cash grain, the sales, to arrive, and the grain actúally delivered in fulfillment of future contracts, from the current of stock shipments declared to be interstate co…

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