202 Ky. 641 | Ky. Ct. App. | 1924
Opinion op the Court by
Affirming in part and reversing* in part.
This appeal presents (1) the question whether a municipality of the fourth class may by ordinance levy a license tax upon a druggist for the privilege of selling whiskey on prescriptions of regularly licensed and practicing physicians; and (2) whether a druggist who has paid such license tax under protest may recover the same in this character of proceeding.
Many years ago the city of Morganfield passed a license ordinance containing many sections, one of which reads:
“To persons who are druggists in good faith, to retail spirituous and vinous liquors at the drug store in quantities not less than a quart, the liquor not to -be drunk on the premises or adjacent thereto, and to sell in quantities less than a quart, for medicinal purposes only, on the prescription of a regular practicing physician, $250.00 per year.”
Druggists in the town of Morganfield, including appellee Wathen, have been paying a license tax under the city ordinance, and the first of the two actions above styled was commenced last May by Wathen to enjoin the city and its officials from collecting or attempting to collect from him a license tax of $250.00 for the year 1923-24, fixed by the city ordinance.
The second action by Wathen was commenced to recover from the city three sums of $250.00 each, paid by him for previous years since the Volstead Act has been in effect as a license fee for druggist under the said ordinance.
It insists that the ordinance, which is admitted to have been valid before the passage of the Volstead Act and the 1920 and 1922 Prohibition Acts in Kentucky, is yet valid and enforceable, and that the city is entitled to collect of Wathen, who operates a drug store, the license fees prescribed by the ordinance.
On the other hand, it is contended that the BashGullion Act -and its predecessor in Kentucky was intended by the legislature to be a full and complete law on the subjects covered by it and intended to supersede all other laws of the Commonwealth on that subject, from which it is argued that it repealed subsection 27 of section 3490, Kentucky Statutes, which confers upon cities of the fourth class the power to license, permit, regulate and restrain the sale of all kinds of vinous, spirituous o,r malt liquors within the city limits and to restrain or prohibit the sale thereof within one mile of the limits of such city. Manifestly the city has no power, since the enactment of the Bash-Gullion Act, to grant the privilege of selling either spirituous, vinous or malt liquors within its limits, for that act provides:
“That it shall be unlawful to manufacture, sell, barter, give away or keep for sale, or unlawfully have in possession or transport spirituous, vinous, malt or intoxicating liquors except for sacramental, medicinal, scientific or mechanical purposes in the Commonwealth of Kentucky.”
The state law in effect prohibits such a license. The Bash-Gullion Act as well as the 1920 act of the Kentucky legislature repealed all acts and parts of acts in conflict with it. Subsection 27 of section 3490 was swept away by
Municipalities have only such powers as are specifically granted them and such as necessarily and properly appertain to and are incident of the granted powers. Without legislative authority a city of the fourth class would have no power to enact such an ordinance as the one in question. Although at the time of the enactment of such an ordinance there was a valid statute to support and warrant it, the repeal of the statute by the legislature ipso facto rendered nugatory the ordinance of the city enacted in pursuance of the repealed statutes.
In the recent case of John J. Craig, Auditor of Public Accounts, etc. v. J. W. Renaker, a druggist, 201 Ky. 576, it was specifically held that the Commonwealth was not entitled, under sections 4203 and 4205 and 4225, Kentucky Statutes, to collect a license fee of druggists for the privilege of selling liquors for medicinal purposes as allowed by the Volstead and Rash-Gullion acts, the reason being that the named sections are in conflict with the recent prohibition laws of the state and were by implication repealed by the enactment of the lattei*.
In disposing of the question involved in the Renaker • case, supra, we said, in the ease of Gifford v. Commonwealth, 2 Ky. Law Rep. 437:
“It was. held that a section in the charter of the town of Falmouth, passed by the legislature in 1878, granting the council of that town the power to license and regulate the sale of liquors, operated as a repeal of the general local option law then in force, because repugnant thereto and inconsistent therewith. So, too, in the later case of Tabor v. Lander, 94 Ky. 237, it was held that where the general local option law had been voted into operation in a civil district of which a city formed a part, an amendment to the city charter conferring for the first time authority on the city council to license taverns and coffee houses with the privilege of retailing liquor in the city, repealed the local option law so far as the city was concerned. The decision was rested on the ground that the authority conferred on the council to license and regulate the sale of liquors was inconsistent with the general local option law, and indicated a clear intent to repeal or suspend the*645 operation of that law. There is no reason, of course, why the rule should not work both ways. In other words if the granting of power to a municipal corporation to license and regulate the sale of intoxicating liquors has the effect of repealing the local option law, then the adoption of a state prohibition act, prohibiting the sale of intoxicating liquors except for specific purposes and under conditions therein set forth, and purporting to be the whole law on the subject, will necessarily have the effect of repealing a license statute which confers the privilege of sale under circumstances and conditions wholly at variance with the provision of the prohibition law. In reaching this conclusion we do not mean to hold that the state may not, under its police power, impose a license fee on druggists who sell under the new restrictions and conditions imposed by the prohibition acts, but merely hold that the old license statute is no longer in force.”
Adopting the rule applied in the Craig-Renaker case, supra, we must hold that the city was without authority at the time of the institution of this litigation to enact such an ordinance as complained of or to enforce the collection of license fees such as the one attacked, and the chancellor properly granted the injunction.
2. The second suit to which we have referred seeks to recover license tax fees paid in former years under this invalid, ordinance. This the chancellor, erroneously adjudged to the plaintiff Wathen. Whether the plaintiff Wathen was entitled to recover the tax thus paid depends upon whether the payment was voluntary or otherwise. Where one pays an illegal demand with full knowledge of all the facts which render the demand illegal without an immediate and urgent necessity therefor, or unless to release his person or property from detention or to prevent an immediate seizure of his person or property, the payment is voluntary. The filing of a written protest at the time of making the payment does not ■change its character from that of voluntary to involuntary. 21 R. C. L. 141.
As the case went off on'general demurrer the averments of the petition may. be looked to for the facts. The petition says in part:
“Plaintiff says that he first refused the payment of said license tax, but frequent demands were*646 made of him by the city council of Morganfield for the payment of said license tax of $250.00, and under protest he did so pay the said license fee as imposed by said ordinance for the year 1920 to 1921, and that said check issued by him to A. F. Waller, clerk, for the payment of said license tax is filed herewith as part hereof.
“Plaintiff says that on March 21, 1922, the city council of Morganfield, Kentucky, did again demand of him the sum of two hundred and fiftv ($250.00), the license tax imposed by said ordinance aforementioned and that under protest and on March 21,1922, he issued his check for $250.00 to A. F. Waller, clerk, in payment of said license tax to May 10, 1922, and that said payment of $250.00 so made 'by him was made under protest and said check paying said license taxis filed herewith as part hereof.
“Plaintiff further says that on May 12, 1922, the city council of the city of Morganfield again demanded of plaintiff the payment of the license tax for the ensuing year and that under protest he issued his check to A. F. Waller, clerk for two hundred and fifty dollars ($250.00) for the license tax imposed by said ordinance aforementioned to May 12, 1923.
“Plaintiff says that said check paying said license tax is filed herewith as part hereof.
“Plaintiff further says that all of said payments were made by him under protest and only on demand of the city council of the city of Morganfield, Kentucky.”
In the case of City of Louisville v. Becker, 139 Ky. 17, 28 L. R. A. (N. S.) 1045, it was held that the payment of the tax under such circumstances in order to obtain a discount, is necessarily in view of the provisions of the statute, to be regarded and treated as a voluntary payment. It is so in substance and effect declared to be by the express provisions of the statute. The privilege of a discount is given to those persons only who make voluntary payments of the tax imposed upon them. And they who avail themselves of the privilege should not refuse to take also the burden of any consequences which are the necessary or legitimate results of the alternative they have chosen. . . . It is true that he (the taxpayer) accompanied his payment with a formal protest; and-it appears that in -one instance the collector was in
In order to constitute an involuntary payment, the payment must have been made under an immediate and urg’ent necessity to release the person or property from detention or to prevent an immediate seizure of the person or property; and where a taxpayer is entitled to a day in court and can litigate the demand to pay interposed against him, but instead of doing so, pays it, the payment is considered voluntary. Tax paid under a mistake of law may be recovered unless such payment is voluntary, and a payment is voluntary when it can be enforced only by suit. City of Louisville v. Anderson, 79 Ky. 334; L. & N. R. R. Co. v. Com., 89 Ky. 531.
The general rule seems to be that a payment of tax under protest before the time payment can be enforced is a voluntary payment, and the sum paid cannot be recovered by the taxpayer unless a payment under protest prior to that time is authorized by statute A mere declaration by one at the time he pays money as tax that the payment is made under protest does not show that the payment is not voluntary. Town of Pheobus v. Manhattan Club, 52 S. E. 839. A mere protest accompanied by a payment does not change this character. It remains voluntary, and a voluntary payment concludes the parties. Gerry v. Siebretch, 88 N. T. Sup. 1034. Certainly a payment of illegal tax under protest before the tax had become delinquent and without any demand or threat, merely to prevent the imposition of a penalty and interest which would accrue on a succeeding day, was voluntary, so that the tax paid could not be recovered. C. N. O. & T. P. Ry. Co. v. Hamilton, 113 S. W. Rep. 361.
Measured by the averments of the plaintiff Wathen’s petition, he was not obligated to pay the tax at the time he did make the paymnt in order to avoid a penalty or
Judgment affirmed in so far as it granted an injunction restraining the collection of the current tax, and reversed as to the recovery for the three past years.
Judgment affirmed in part and reversed in part.