(dissenting). This is a review, under article 78 of the Civil Practice Act, of official Order No. 127 made by respondent under authority given by the Rogers-Allen Law (Laws of 1937, chap. 383) to regulate and fix prices for milk produced and sold in the Niagara Frontier Marketing Area. The petitioner is a co-operative association of Guernsey dairy farmers, organized under the laws of the State. Some of its members are affected by the order. While the petitioner asserts irregularities in the adoption and promulgation of the order, the primary objection is that by failing to establish “ reasonable differentials for quality ” it is confiscatory of the property of the members of the petitioner corporation, as “ Golden Guernsey ” milk which they produce is of greater value than other pooled milk, and entitled to a favorable differential under the pooling plan, and that Order No. 127 places it on a parity with milk of less market value.
The order was made by respondent as Commissioner of Agriculture and Markets on September 19, 1938, to become effective October first. It was designed to regulate the price of milk produced and sold in the Niagara Frontier Marketing Area, which comprises the cities of Buffalo, Tonawanda, Lackawanna, Niagara Falls, Lockport and North Tonawanda, and certain contiguous towns in Erie and Niagara counties. It establishes an equalization fund to be paid to and disbursed by a fiscal agent. Marketers of milk within the area who received a greater amount of money than would be produced by the uniform prices fixed by the Commissioner are required to pay the surplus to the fiscal agent, who makes payments therefrom to those who receive less than the fixed amount, to equalize the disparity. Many and varied are the details of the plan. Only essentials will be discussed.
The milk is divided into four classes according to its expected use. The milk of each producer is divided among the classes in the same proportion which the amount he delivers bears to the entire milk sold by the marketer. The Commissioner fixes a minimum which the marketer must pay for each class, and which is used to determine whether a marketer is to contribute to or receive from the fund. Class I is milk which leaves the plant where it is received from the producer, as “ whole milk, chocolate milk or any whole milk drink, and all other milk for which classification is not established in some other class.” The minimum price fixed for this class varies from $2.35 to $2.85 a hundred, dependent upon the period of the year and whether the milk was a direct delivery by the producer to the utilizing plant, No *250data is given as to the means by which these prices are fixed. Class Il-a milk is that which the marketer sells in the form of sweet or sour fluid cream. Its price varies according to a schedule and table set out at length in the order. It is dependent upon the season of the year and the butter price range reported by the United States Department of Agriculture “ for 92-score butter at wholesale in the New York market.” To illustrate, from March first through July, if butter sells between 30 cents and 34.9 cents per pound, the price of the milk is $1.85 per hundred. Class II-c is used in the manufacture of ice cream “ and milk used for all other purposes, except as described in Classes I, Il-a and IV-a.” The price thereof is fixed as “ not less than $.15 more than the price determined for Class IV-a milk.” Class IV-a milk is made into butter. The price is fixed according to the following formula: “ From the average of the highest price reported daily during such month by the United States Department of Agriculture for 92-score butter wholesale in the New York market deduct 4¡é, add 20% and multiply by 3.5.” Applying this formula to butter at 30 cents a pound, the price of the milk is $1.092 per , hundred.
These prices are for milk containing 3.5 per cent butter fat. All milk, Golden Guernsey, Holstein and that produced by any other breed, is on a parity except for the butter fat content. For Classes I, Il-a and II-c, the price is reduced four cents a hundred for each one-tenth of one per cent which a producer's milk falls below the standard, and increased a like amount for being above. The differential as to Class IV-a is arrived at by dividing the price per hundred fixed by the butter quotation formula by 3.5. Applying this to butter at thirty cents a pound for March through July, the increment or diminution is .0312 for each one-tenth of one per cent. Co-operative associations like the Dairymen's League are allowed a differential or cooperative service payment of five cents per hundred on all milk they handle, plus eighteen or twenty cents per hundred weight and transportation charges upon certain milk which they give extra handling. New producers are penalized for the first month by having all their milk placed in Class IV-a. The milk of a producer who is also a marketer is not classified, and no report thereon is made to the fiscal officer. Two cents for each hundred of pooled milk is required to be paid to the respondent to defray the cost of administering the order. It is to be deposited with a trust company, is subject to withdrawal at respondent’s direction, and is not deemed to be State money. No provision for paying out any surplus which might be built up is made, except that when the Commissioner terminates the order, he is required to *251“ dispose in an equitable manner of all funds received pursuant to the provisions of this order, together with claims for any funds which are unpaid and owing at the time of such termination or suspension.”
There is more demand for Guernsey as whole or fluid milk than for that produced from other breeds because of its yellow color and higher content of butter fat. (This would not be true as to milk from Jersey cows, but the amount of that in the pool is negligible or non-existent.) Petitioner established that in a given month nearly eighty-five per cent of the Guernsey milk supplied in Buffalo was sold as whole milk at the Class I price; just over fourteen per cent as fluid cream, the second highest priced class, and less than one per cent used for butter. The report of the Commissioner shows that for a given month just over sixty-four per cent of the pooled milk was sold as Class I, seventeen per cent asj3ream, seven per cent as ice cream, and twelve per cent used for butter. As the prices for the. respective classes vary from $2.85 down to $1.02,“ the added value of milk which the public desire to use on the table is obvious. This preference of the public for Guernsey milk makes it more valuable than other milk, and a favorable differential was proposed to, but rejected by, the Commissioner. In another case (Matter of Begent v. Noyes, 260 App. Div. 231) the respondent required that a dealer in Ithaca should receive one cent a quart more for Guernsey milk than for that produced by other breeds. The petitioner has expended $300,000 during the past years in acquainting the public with the merits of Guernsey milk. It costs more to produce Guernsey milk than Holstein milk. The latter breed will produce considerably more milk per cow of an equal butter fat content, than the former, but it lacks other food elements and the attractive color which makes Guernsey milk more salable.
The butter fat differential does not compensate petitioner. Whenever the selling price of milk is above $1.40 per hundred, the amount allowed therefor is more than 4 ^ for each one-tenth of one per cent up to the standard of 3.5 (40¡á for each 1% of fat 3.5). With 3.5 butter fat milk selling at $2.80 per hundred, which is slightly less than was received for whole milk sold in the Frontier area as reported by the Commissioner, 80 ¡¿ is paid for each one per cent (3.5 X 80). 3.5% butter fat is the average content of milk generally; the average for Guernsey milk is at least 4.5%. Thus, for the first 3.5%, 80¡¡5 is paid for each one per cent, while only 40 i is paid for the top and desirable one per cent. For table use, the public is willing to pay more for rich yellow milk (Guernsey) than for rich white or blue white milk (Holstein). It is no answer *252to say that the latter has all the nutritive value of the former. Diamonds and coal are each composed of carbon. The public will pay more per pound for the former.
Petitioner may not sell its milk to the public without respondent’s permit and license. (Agriculture and Markets Law, § 254.) Order No. 127 controls and restricts the selling of petitioner’s milk. Unless a producer is able to sell all his milk at prices in excess of the Class I price as fixed by the Commissioner, the amount at which it sells above the uniform price fixed goes into the equalization fund which is paid to producers who receive less than the uniform price fixed by the Commissioner. (Order 127, art. 6.) The order contains no provision under which petitioner may be compensated for the excess market value of its product, or whereunder it may have returned the money expended to produce Guernsey milk, which, unquestionably, is greater than the cost of producing Holstein milk.
This order and the statute under which it is made by the Commissioner have been the subject of litigation. (Noyes v. Erie & Wyoming Farmers Co-op. Corp., 281 N. Y. 187.) The Albany Special Term dismissed the complaint of this respondent in actions brought to enforce the order. This was reversed by the Court of Appeals. Implicit in that decision was a determination that the statute and the order were constitutional and that proper steps had been taken to establish and promulgate the order. The issue was not presented to the Court of Appeals and by appropriate language in the opinion it left open for decision all questions as to the rights of individuals under the Fifth and Fourteenth Amendments to the Federal Constitution when an individual or group should make it appear that “ the order or regulation issued thereunder would cause bim injury ” (p. 195). Whether the enforcement of the order is discriminatory “ would necessarily depend upon the facts and circumstances in each particular case at bar after the issues were duly presented and the facts then at issue developed” (p. 195). The court stated that further consideration of the constitutionality of the act could be had whenever a litigant should show by proper pleading “ that he comes within the scope of the act and that special features thereof or of the order or regulation issued thereunder would cause him injury ” (p. 195). A majority of the present Supreme Court of the United States has recognized and announced that there may be an “ exaggerated equalization of wealth and opportunity.” (United States v. Rock Royal Co-op., 307 U. S. 572.) The requirement that petitioner shall sell its product, costing more to produce and for which there is a greater market value, at the same price of an article costing less to produce and for which *253the market price is lower is “ exaggerated equalization,” and confiscatory, and violates its constitutional rights.
The order should be annulled in so far as it denies petitioner’s right to a favorable differential in the pooling plan, and the matter should be remitted to the Commissioner for such proceedings as he deems proper to ascertain the amount of and the manner in which the differential shall be effected.
Heffernan, J., concurs.
Order confirmed and petition dismissed.