Anderson's Paving, Inc. v. Hayes
295 S.E.2d 805
W. Va.
1982
Check Treatment

*1 295 S.E.2d 805 PAVING,

ANDERSON’S

INC., al., etc. et A., HAYES,

Ralph E. P. County.

Greenbrier

No. CC927. Appeals of

Supreme Court of Virginia.

May 1982.

Dissenting June

Concurring Sept. O’Farrell,

Jackson, Kelly, Holt & Thomas Potter, E. M. Blane Michael and James R. Charleston, plaintiffs. Snyder, Browning, Atty. H. Chauncey Gen. Hoover, Gen., Atty. K. Asst. Marianne Charleston, for defendant. Barber, by Timothy

A. Manchin N. J. Charleston, W. Va. Education Ass’n Jac- J., McGraw, opin- dissented and filed Wise, A. Kinnaman and E. queline Robert ion. Jr., for intervenors. Miller, J., specially and C. concurred The W. Va. Chamber Commerce J., McHugh, joined. filed in which Woodroe, Love, Wise, Robinson & Charles Porth,

R. McElwee and William C. Charles- ton, curiae. for amicus NEELY, Justice: we are In the certified case before us nothing apply more than asked to do *2 law, unambig- as formulated issue Bellotti from our own statutes uously by Supreme the United States plaintiffs informed the that he would Court, to the facts of this case. prosecute them should the any Upon make receipt contributions. of reply, plaintiffs filed an action for de- claratory judgment in the Circuit Court of This Case County seeking Greenbrier to have the two April Virginia Leg- On 1981 the West in question statutes declared unconstitu- adopted islature Senate Joint Resolution tional. The State moved to dismiss and the proposes No. which an amendment to the pure legal issue of constitutionality was designated Constitution as joined. After due consideration of the de- Progress “Roads for Jobs and Amend- fendant’s motion and the Supreme U. S. (Road Amendment). ment” Bond This Bellotti, Court’s decision in the circuit amendment will be submitted to the court held the two statutes unconstitution- special electorate for ratification at a elec- al. The circuit court then certified the Tuesday, tion to be held on 3 November question constitutionality of the of the stat- utes to this Court. August plaintiffs On 3 1981 the sent a Prosecuting letter Attorney of II County informing Greenbrier him that the plaintiff corporation planned to make con The Bellotti Case support passage tributions In First National Bank Road Bond Amendment. In the letter the Bellotti, plaintiffs they asked whether would be (1978) L.Ed.2d 707 the United States Su- prosecuted Code, 3-8-8(a) under W Va. preme Court struck down as unconstitu- [1978], 3-9-14 which make it a criminal tional a Massachusetts statute making it any corporation, offense for officer or unlawful for a agent contribute acting on behalf of a funds or other valuable assistance to cam- political make pur contributions for the paigns against any for or election issue or poses influencing any election issue.1 appellants, candidate. In that case the plaintiffs prosecutor informed the which banking were several national associ- Supreme the United States Court decision corporations, sought ations and business in First National Bank Boston v. Bel publicize opposi- contribute funds to their lotti, permit tion to a referendum to enactment (1978) made the West personal graduated a state income tax. question statutes unconstitutional. August prosecuting On 20 attor- Court addressed the issue ney replied. distinguished He by examining the statute whether the First Amend- whatever. No tion.” or authorize to be ey corporation, ment of person such other any corporation, state, article incorporated Code, 3-8-8(a) "Except "No officer of W.Va. or other payment, or person acting eight Code, any primary committee or other foreign country, behalf of such thing under the laws of this or provided of this 3-9-14 [1978] contribution or other any person any corporation, officer or paid, given of value candidate, on behalf of such or other election chapter, any corporation in section shall solicit or receive says: shall corporation, person, says: belonging agent financial or pay, give lent, eight or for the thereof, thing any any expenses agent whether agent or to such [3-8-8], other mon- lend, pay- or or to influence the result of five shall be dollars for ular question vote for a conviction possession, or which offer, or another, indirectly, money used, thousand nor manner, give shall, jury.” to be decided at or guilty particular or thereof, every to be under the control or at the place or use, influencing any its of a upon any particular offered, such or cause to be or cause to be officers, more than shall be fined not less than candidate, or other misdemeanor, and, offense, given agents thing voter or voters to twenty such at the discretion such or in or offered, placed used, or election, side of election, any partic- otherwise, value, thousand disposal directly in the given upon any or it

were found that the electoral vincing. Id. at in defense of posed restrictions tected State’s State’s clusive and made speaker did not constitutional mined Amendment’s determined ment speech to be “exacting scrutiny.” minority 98 S.Ct. appellants corporate no facts to short protected that speech, justifications for the statute argument the statute’s that the work subject matter of at 1415-1420. shareholders was both the statute entailed underinclusive and that process. protection. protection,” the statute. “at the heart wanted to the Court examined the sort of 786-95, justify deprive the was, therefore, corporate nature of the It found constitutionally pro- the State’s In turn the State’s alleged protection 435 U.S. at 776- make. the Court next The Court then Having speech of the First would harm arguments that there proffered at 1421- state-im- Finding concern overin- uncon- deter- of its with provisions ject. majority porate speech strike the public penditure ing writer) disagree In all extent turbs our State statute on this latter sub- election of individual porate speech which relates cerning corporate speech enunciated Bel- facts of the case and the lotti and important, holding are both so W.Va.Code, Consequently, the that the vote on corporate speech which relates to ; however, follow other A election, that our of candidates. Court provisions however, regards corporate money on direct cor- 3-9-14 the law as articulated W.Va.Code, opinion today Supreme Court. *3 distinguished between cor- the they are unconstitutional. with of this Court a referendum issue at a abundantly clear. we find those obligation of this Court [1978] Court in their candidates for the conclusions con- purpose recognize that the 3-8-8 Nevertheless the and, finds that to the prohibit entirety, apply public (but not this no rather than of influenc- [1978] statutory way Court’s the ex- office, issues It is and dis- the remedy our doctrine of the least intrusive Ill prohibit only their enforcement engaging corporations direct II Applying Bellotti voluntary contributions from stockholders basis for cate its views on preme not limit a poses. 8(b)(1)(C) and 65 L.Ed.2d 319 Court concludes that the United States Su- ation on the rate facilities for the ed from a Commission, Consolidated Edison Co. Public Service The State would have employees While this does case from the case under consider- distinguishing corporation’s separate grounds squarely which permits fund for that W.Va. may held that a state the two provide us the use of issues. See also then distinguish to communi- Again Code, a tenuous cases, soliciting expend- 3-8- may pur- porate speech way affects the law with butions to See tion W.Va. 160 W.Va. said in speech from total invalidation. which will cure its defect and save it this Court will ute, least intrusive ly deficient for constitutional necessary public purpose but is technical- also State ex rel. Harris v. Where a statute serves an to, political we wherever syl. on a emphasize 2pt. 290 S.E.2d public candidates possible, remedy apply 233 S.E.2d 318 candidates or direct cor- Weaver issue. As this Court that our the doctrine of the an regard of, running (1980): interpretation give holding in or in Shaffer, Calendine, urgent to contri- the stat- reasons, opposi- pub- and no difficulty achieving majority lic elections. po- consensus in this controversial area of argument September After oral on 29 undoubtedly litical balance and free 1981, we handed down a decision in favor upon majority opinion had its effect plaintiffs on 15 October 1981. On Bellotti. We find it difficult to follow the 1981, after Road Bond November logic polls, Court’s Amendment had been defeated at the distinguishes granted and we the West Education between election issues Manchin, enacting chapter Association and A. James as Sec- 31 of the West Code, retary of West proce- State which enumerates in detail the intervene. On December we creating operating corpora- dures for granted rehearing original tions, outlining rights, well as duties intervening parties we so that could consid- and liabilities of entities. er issues that were either not raised or long State, It has been established fully developed necessary due to the country, and in this are speed originally with which this case was person, “artificial possessing those reargued heard. This case was before us properties only, which their charter May on 5 1982. We now conclude that the confers on them expressly either or as nec *4 original interpreted applied decision and essarily incidential to their existence and to correctly.

the law carrying purposes, out of the for which Accordingly for the reasons set forth they are created.” Laurel Fork & Sand above this Court confirms the lower court’s Hill Railroad Co. v. West Trans ruling constitutionality on the of the stat- Co., 324, portation (1884); 25 W.Va. 333 question utes in as those statutes relate to see also Trustees College Dartmouth corporate speech direct addressed to refer- Woodward, (Wheat.) 518, 17 4 U.S. L.Ed. endum issues but we decline to invalidate (1819). Implicit 629 in this statement is the they the statutes as relate to other areas of that, persons, idea as artificial corporations corporate participation in elections. are not entitled to the same constitutional Ruling affirmed. rights persons, as natural but rather are rights entitled to those constitutional McGRAW, Justice, dissenting: “necessarily that are pur incidental” to the poses corporation. of the If the denial of analysis The constitutionality W.Va.Code should not begin §§ 3-8-8(a) end with an and 3-9-14 unques- corporation, certain rights then those would materially rights are necessar affect a ily corporation’s incidental to that exist tioning application of First National Bank ence. Bellotti, 435 U.S. 98 S.Ct. of 1407, (1978). Bellotti, 55 L.Ed.2d 707 In Court, The Supreme in Court, Supreme the United States under Bellotti, prior cases delineated what guise extending First Amendment rights necessarily are pur incidental to the expression corporations, freedom of poses rights and those reality given sanctioning that are not. In Bank the United potential abuses of referendum elec- Deveaux, (5 Cranch) 61, 9 States v. U.S. 3 sought by approximate- tions to be avoided (1809), corpo L.Ed. 38 the Court held that a ly legislatures Congress, 31 state right party ration has the to be a in federal where statutes similar to the ones here in In courts. Rex Trailer Co. v. United question adopted, equat- have been and has States, 219, 100 76 S.Ct. L.Ed. ed speech with the to free- (1956), indicated, the Court without ex expression per- dom of accorded natural pressly holding, so that a can by sons. The error committed the United placed jeopardy not be double viola Supreme States that has been tion of the Fifth Amendment. In Santa adopted analysis by majority with no a Railroad, Clara Co. v. South Pacific Court, recognize is a failure to (1886), 6 S.Ct. 30 L.Ed. 118 U.S. artificial nature of held, explanation the Court albeit with no analysis, In West “per the creation of that a is a provided equal protection tions is Article son” entitled to the § (1872) Constitution, guaranteed by of the West as laws Fourteenth “legislature which states In pro- that the shall Amendment. these three cases the organization upheld corpo vide for the of all States United Legislature rights necessarily hereafter to be created.” The rate found to inciden existence, corporation’s although carried out this a constitutional mandate tal to the Fourteenth Immunities clause of holdings in these cases the rationale for C.I.D., 307 U.S. opinions. Hauge Amendment. is not stated 83 L.Ed. justi- can also be More recent decisions Due Pro- “liberty” protected under the rationale application fied of the Fourteenth cess clause necessarily incidental to rights are certain liberty persons, of natural corporation’s existence. a Ins. Co. Northwestern Nat. rations. some Life granted has been commercial Riggs, beginning protection, First Amendment L.Ed. Pharmacy Bd. v. Va. Consumer with Va. Council, States Court Bel- The United speech is Commercial lota, majority in this have and the ex- necessarily corporation’s to a incidental ignored long line where the of eases through its exercise istence because between artificial natural distinction able to inform corporation is better recognized persons and used was services, products general of its determining what starting point products being that more the end result extended to entities. should be sold, strength- *5 and services will be By of cor- disregarding the artificial nature right the The to freedom corporation. ens situ- porations, we now have the anomalous newspa- press extended to has been entity that is in- ation where an artificial corporations in the field per and other ballot, can, capable casting by spend- a Grosjean American communication. dollars, ing potentially dictate thousands of 444, Co., 233, 55 80 297 U.S. S.Ct. Press the outcome of a ballot referendum that (1936). businesses in the L.Ed. 660 Since an issue has no relevance may involve that express exist to field of communication the corporation. to the existence of Bellot- through vari- transmit and facts the ideas expression, increase freedom of ti did not media, these busi- ous it is essential that merely magnified of ex- but the volume the right nesses the to freedom of have pression allowed to artificial entities. The corporations organized press. Groups or likely most that end result will be natural protected and ideas are to advance beliefs persons, speak, will who can vote and have But- by the First Amendment. NAACP v. being difficulty in heard over the blare 328, ton, 371 9 L.Ed.2d U.S. corporate money. by financed together right 405 The to associate the reason present for a common is whole In the the Court should NAACP, being like groups for the or not have determined whether therefore to associate is necessar- freedom Paving, Inc. be material- Anderson’s would organizations. All ily to such incidental ly by passage of the Road affected organizations in three or these corporation Only Amendment. if the Bond materially cases would have been affected materially is affected should the hold if the court had not extended constitutional expression in this instance that freedom protection to them. necessarily Anderson’s is incidental to to purpose, and extend constitu- achieve its Court, in rec- The United States expression. protection to allow such tional ognition artificial nature of tions, many rights denied Therefore, proceed- I would remand for A cannot ings resulting finding in a whether or privilege claim a self-incrimination. materially not would affect- Anderson’s be White, 322 64 ed the referendum issue. L.Ed. 1542 A S.Ct. 88 equal right have an ration does not MILLER, Justice, concurring: Chief privacy enjoyed by per- a natural that reached Co., I concur the result While son. United States Morton Salt that emphasize I wish to nei- majority, L.Ed. 401 S.Ct. opinion majority ther nor First Nation- A a “citizen” Bellotti, 435 U.S. meaning Privileges al within Bank of (1978), Against L.Ed.2d zens Rent City Control v. Berkeley, to mean that the State has no be taken S.Ct. can (1981), L.Ed.2d regulate corporate in which it spending on invalidated a power to municipal imposed ordinance which a $250 issues. limit on made contributions to committees It should be noted that Bellotti was oppose formed to referenda. dissenting opinion with three of the 5-4 virtually This was unanimous with taking the view that the First Justices Again dissenting. Justice White associa- recognized state’s be extended tion should to a control contributions to referendum issues only to extent the referendum might be authorized if there awas record material effect its issue has a business that demonstrated that such control “is activity.1 grant Under this limited of cor- to preserve needed voters’ confidence in porate rights, peti- First Amendment ballot process.” measure 454 U.S. at tioner in the case at bar would have stand- L.Ed.2d at 501. ing challenge our election Court, also, made a distinction between statutes, spending pas- since the successful the state’s to limit contributions or sage proposed road en- bond would expenditures candidates and petitioner’s highway paving hance the busi- contributions to ballot or referendum is- ness. sues: majority in appears Bellotti to rec- may “Whatever be state interest or ognize may that a state restrict degree in regulating of that interest spending in a referendum where it can limiting to or expenditures *6 corporate participation shown that has aof candidate or a candidate’s commit- significant influence been in the refer- significant public tees there no is state prior corporate endum or that because of curtailing interest in debate and discus- participation been to there has some threat Placing of a sion ballot measure. limits the confidence of the in their citizens on contributions which turn limit ex- government:2 penditures plainly impairs freedom ex- been showing “But there has no pression. integrity of corporations relative voice has system adequately protected will be if overwhelming significant been or even contributions are identified in a Massachusetts, influencing referenda filing revealing contributed; the amounts or that has threat there been to thought wise, legislation it if is can out- citizenry govern- confidence of the anonymous law contributions.” 454 U.S. ment. Georgia, Cf. Wood 102 S.Ct. at 70 L.Ed.2d at 1364, 1372, 388, 82 S.Ct. 8 L.Ed.2d 501. 789-90, 435 U.S. at mind, foregoing With limitations (Foot- S.Ct. at 55 L.Ed.2d at 726.” W.Va.Code, agree majority with omitted) note 3-8-8, overly is broad to extent that it rehearing Pending prohibits making in this Court decided contributions toward referendum issues.3 Citi- expenditures Rehnquist 1. Justice dissented on the basis that tween drawn contributions Valeo, only applica- Buckley the First limited Amendment bility necessary is it to the States under Due Process Neither to Clause Amendment, the Fourteenth the Four- consider contributions to action com- applies persons teenth Amendment and not mittees. See Medical Association v. California Therefore, view, Commission, corporations. in his a state has Federal Election controlling legislation L.Ed.2d to enact the First W.Va.Code, possible might be 3.While it read 3-8-8, prohibition applying 2. Because of the in W.Va. contribu- absolute Code, 3-9-14, (see infra), against any political campaigns, it seems clear that Note tions issues, W.Va.Code, 3-9-14, prohibition it contribution the corporate necessary “for the the distinction be- of in- consider Justice to state that I am authorized concurring opin- in this

McHugh joins me

ion. S.E.2d rel. ex

STATE of West

Phillip L. MORRIS Guthrie, KING, George

Kyle and C. G. LePage,

Frank Commissioners Commission of

Police Civil Service

City Virginia. West

No. Appeals Virginia. 23, 1982.

June July

Rehearing Denied *7 Clifford, and Michael T.

Leo Catsonis appellant. for Bennett, Charleston, ap- for Thomas B. pellees.

PER CURIAM: appeal Phillip L. Morris This is an Kana- of the Circuit an order dismissing a writ County petition wha petition appellant In the of mandamus. alleged procedure had that an evaluation used the Police Civil Service Commis- City of to determine sion of the Charleston any prohibition fluencing upon any such election” voter or voters ... elections. particular question to side of be decided