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decided: May 18, 1936.



Hughes, Van Devanter, McReynolds, Brandeis, Sutherland, Butler, Stone, Roberts, Cardozo

Author: Stone

[ 298 U.S. Page 408]

 MR. JUSTICE STONE delivered the opinion of the Court.

This case is here on appeal, Judicial Code, ยง 238, from a decree of the district court for New Mexico, three judges sitting, 12 F.Supp. 755, dismissing the bill of complaint by which appellant sought to enjoin appellee, the state Commissioner of Revenue, from enforcing the provisions of a state law exacting a permit fee for the privilege of transporting motor vehicles over the highways of the state for purpose of sale.

The statute assailed, Chapter 56 of the New Mexico Session Laws of 1935, denies to all persons the use of the highways of the state for the transportation of any motor vehicle, on its own wheels, for the purpose of selling it or offering it for sale within or without the state, unless the vehicle is (1) licensed by the state, or is (2) owned by a licensed automobile dealer and operated under a

[ 298 U.S. Page 409]

     dealer's license, or is (3) operated under a special permit issued by the state Commissioner of Revenue for its transportation. For such a permit the statute levies a fee of $7.50 if the vehicle is transported by its own power, and a fee of $5.00 if it is towed or drawn by another vehicle.

A later act, Chapter 136 of New Mexico Session Laws of 1935, provides for establishing registration stations or "ports of entry," on the main highways of the state, at which permits are to be issued and fees collected. It provides that no vehicle for which a permit is required shall receive a permit or be allowed to proceed until inspected and found to be "in safe and roadworthy condition, properly equipped with all lights, brakes and other appliances" required by state law.

Appellant, a resident and citizen of California, is engaged in the business of purchasing new and used automobiles in eastern and southern states of the United States, and transporting them, on their own wheels, over state highways to California, where he offers them for sale. He customarily transports such cars over the highways of New Mexico for a distance of about one hundred and sixty-six miles, in processions, or caravans.

Chapter 56 is challenged here, as it was below, as imposing an unconstitutional burden on interstate commerce, and as infringing the due process and equal protection clauses of the Fourteenth Amendment. Appellant also urges that the taxing provisions of this Act, enacted February 21, 1935, were repealed by the passage, a week later, of the "Ports of Entry Act," Chapter 136 of the Session Laws of 1935. The trial court held that the earlier Act had not been repealed, and construed it as exacting the permit fee for the privilege of using the state highways, and as not exempting, from the fee, cars operated under a dealers' license when transported for sale. It thought that the statute is aimed at the considerable

[ 298 U.S. Page 410]

     business in the state, as shown by the record, of transporting automobiles, usually in caravans, over state highways for sale; that such transportation constitutes a distinct class of automobile traffic, which causes increased wear and tear of the highways and interferes with their safe and convenient use by others; that these circumstances justify a separate classification of the traffic for the purpose of exercising police control over it and fixing a fee or tax for the privilege of transporting automobiles over the highways in such traffic. The court accordingly held that the statute infringes no constitutional limitation on state power.

1. We see no reason, and none is suggested, for not accepting the construction of the statute adopted by the trial court. The statute applies alike to all automobiles transported for sale, whether moving intrastate or interstate. Unlike the general tax in Interstate Transit, Inc. v. Lindsey, 283 U.S. 183, the levy of which was unrelated to the use of the highways, grant of the privilege of their use is by the present statute made conditional upon payment of the fee. The manner of its collection, not unlike that of a toll for the privilege of entering and using the highways, definitely identifies it as a charge for the privilege. It is not shown to exceed a reasonable charge for the privilege and for defraying the cost of police regulation of the traffic involved, such as a state may impose, if non-discriminatory, on automobiles moving over its highways interstate. ...

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