Opinion
Argued May 26, 1947
Decided July 2, 1947
Appeal from the Supreme Court, Appellate Division, Third Department.
Raymond F. Allen, T. Carl Nixon and Hampton H. Halsey for petitioners-appellants. Rowland L. Davis for Holstein-Friesian Association of America, amicus curiae, in support of appellants' position.
Robert G. Blabey and Donald L. Brush for C. Chester Du Mond, as Commissioner of Agriculture and Markets of the State of New York, respondent. Irving G. Hubbs and Merritt A. Switzer for New York State Guernsey Breeders Co-operative, Inc., respondent.
The petitioners, having appeared and opposed the order sought to be reviewed, were entitled to prosecute a proceeding under article 78 of the Civil Practice Act to review the commissioner's determination as parties to the record before the commissioner whose property and rights were immediately and directly involved. The order was invalid upon its face, the commissioner having recited that he signed it without finding or determining the facts upon which his official act was predicated, and only because of a belief, quite obviously mistaken, that he had been directed so to do by the Appellate Division. The statute, subdivision 6 of section 258-m of the Agriculture and Markets Law, provides for an equalization of prices "so that each producer or co-operative association shall receive the same base price for all milk delivered subject to reasonable differentials for quality and location and for services." In the instant case the only questions presented relate to quality. The testimony established with little if any question that there is an intrinsic characteristic in Guernsey milk which distinguishes it from other milk. The intrinsic difference may or may not justify a "reasonable differential". In determining what is reasonable under all the circumstances the commissioner exercises a wide discretion but is to be guided by the fundamental purpose of the statute of establishing in a great market fair and equitable equalization of prices. The Legislature has quite deliberately refrained from prescribing rigid rules to control the exercise of this broad discretion, and in Matter of New York State Guernsey Breeders Co-op., Inc., v. Noyes ( 284 N.Y. 197), we did not intend to bind this discretion by mandatory prescriptions regarding the commissioner's process of decision but in that case found it necessary to remit the matter to the commissioner because of his failure to make findings upon which he predicated his conclusion that a differential should not be granted. Without such findings the courts would be unable to determine whether or not the statutory mandate had been carried out.
It may be that confusion has resulted from the statement in the opinion in Matter of New York State Guernsey Breeders Co-op., Inc., v. Noyes ( 284 N.Y. 197, 203, supra), that the commissioner has "power to grant a differential where it is shown that there exists a distinct difference in production cost, quality or marketability of milk of one breed of cows from that of other breeds". The correctness of that statement cannot be questioned but it does not mean that every such difference in production cost necessarily imposes a statutory duty upon the commissioner to grant a differential. On the contrary, that circumstance is but one of many elements to be considered in fairly and justly determining the equalization price and differential with reference to quality, location and service. It is enough to say at this time that the case is remitted to the commissioner with directions to find and state the conclusions of fact upon which he predicates whatever determination he may make upon a reconsideration of the testimony already taken and such other testimony as the parties may adduce.
The orders of the Appellate Division should be reversed, with costs in this court and in the Appellate Division, and the matter remitted to the commissioner for further proceedings in accordance with this opinion.
LOUGHRAN, Ch. J., LEWIS, CONWAY, DESMOND, THACHER, DYE and FULD, JJ., concur.
Orders reversed, etc.