*1 CONCLUSION Appellee urged: (a) ap- no has also that there was pealable County Education; order made Board (b) (§ -Stats.) that the Ark. Statute 80-408 does County contemplate appeal finding an from the Board’s petition annexation contained an insufficient signatures. number of We considered have not these con- that, because we are convinced at events, all tentions, the appellee prevail petition should on the fact that the signa- for annexation contained an insufficient number of judgment Therefore, tures. affirmed; of the Circuit good and for cause shown an immediate man- is ordered date to issue.
Gipson Morley, Commissioner of Revenues. 4-9209 S. W.
Opinion May delivered 22, 1950. *2 appellant. Kenneth G. for Coffelt, Bailey appellee. 0. T. and Warren, Ward for .& Appellant Gipson, J. A. as a citizen James Leflar, taxpayer, brought injunc- equity and bill an tion to restrain the and the of Revenues Commissioner enforcing paying from or out funds State Treasurer provisions 282 of Acts the enforcement the of Act the Assembly of Arkansas- for 1949. Act 282 the General principal groups provisions: (1) It contains three at which sales of and related items .fixes beer) (not including may be made at wholesale or retail— is fixed for wholesale at the wholesaler’s sales plus percent, cost 15 and for retail at the retailer’s sales plus percent liquor, plus percent cost on on 1/3 specialties, liqueurs plus percent and and on cordials, sparkling (the and still wines various enumerated items statute); (2) per are defined in the a tax of 25 cents casé per and other stated items and cents case on proceeds go special wine is into a fund levied, Treasury; (3) appropriated the State there is from special pay fund certain amounts to salaries expenses employees of 20 in the office of Commis- duty sioner of Revenues whose to enforce this and Gip- all other control Plaintiff laws of State. son’s contention is that Act 282 is unconstitutional under II, §§ 3, 18, Article 19 and 21 of the of Ar- Constitution unconstitutionality kansas. The contention of is serious- ly urged provisions group however, (1) summary just given relating numbered in the —those price-fixing. virtually taxing It is conceded that the provisions, appropriation and the for additional em- ployees police are the State, constitutional, valid. The Chancellor held the Act to be appeals. plaintiff upon appel- sections of the The Constitution lant relies are as follows: equality persons
“§ the law 3. of all before The recognized, nor shall and shall ever remain inviolate; any right, privilege any deprived im- ever be citizen any duty, exempted munity, on ac- burden nor previous color or condition. race, count “ Assembly grant § 18. General shall privileges or immunities which of citizens citizen or class equally belong to all shall not same terms citizens. contrary Perpetuities monopolies to-
“§ *3 genius republic, nor not allowed; of a shall be the any hereditary privileges honors or emoluments, shall granted ever or State. conferred this imprisoned, person or or “§ 23. No shall be taken privileges; liberties or estate, freehold, disseized of his any destroyed deprived or of or outlawed, or in manner liberty judgment property, except his his the of life, any peers any person, under land; or the law of the nor shall ’’ from circumstances, be exiled the State. apparent It none these sections contains is that of specific prohibition against type legislation here prohibition dis- it will have to be enacted. If there is a spirit general or from sections, covered of the implicit though explicit some inner not deemed essence prohibition discovery the words. of such a Furthermore, authority negative regulatory would under the the State’s past police concept power, in the which a constitutional justify governmental been held controls has numerous exercised over the business. practically right regulate
A unlimited early traffic has from times been conceded to State. authority right, “The to sell has because State this may grant privilege, which the a mere State pleases, grants permission as it if it this withhold, or, may at all, it do under conditions which cares so impose; though these . even true this is pro virtual are so as to amount to conditions onerous Horner, 250, that v. 115 Ark. hibition of traffic.” Wade “The 1916E, Ann. 167. 1005, 1008, S. W. Cas. 258, right pro intoxicating liquors is not a matter sale only guarantees. privilege, tected constitutional It is police power. The exercised under the General to be Assembly, may impose legalizing such traffic, appropriate.” Cook, restrictions as it Commr. v. deems Drug Co., Wholesale Glaser’s Ark. S. 189, 195, 189 W. 900. Accord, Ziffrin, Inc. U. S. Reeves, Ct. 84 L.
60 S.
Ed.
previously
case in
has
pass
validity
price-fixing
occasion to
had
Davis,
There are cases from other several *4 liquor price-fixing plans have been denied enforce- they give They ment, but do not likewise us aid. much from the come and Florida. states Illinois, New York, Louisiana, Liquor The case of Illinois Control Commission v. Chicago’s Liquor Last Ill. Store, 403 N. 578, 88 E. 2d liquor price the Illinois held control act to be invalid be- prohibition violated cause it an Illinois constitutional against revival or amendment of an earlier act ref- merely. legislative drafting technicality erence That is a completely the Arkansas act avoids. App. Supp. Levine v. Div. O’Connell, N. 217, 88 Y. (2d) ground invalidated the New York concept right, The or of of common “natural fundamental analyzed (1948) rights,” a Comment 2 Ark. L. Rev. improperly delegated power price-fixing it to a
tliat assume, state board. The New said: York Court “We deciding, competence without that it would within be legislature mandatory price of the ing fix- to determine that beverages proper in the sale of alcoholic would be a police power. important point exercise of the legislature case is that the trary (it) purports has not done on the con- so; Liquor to authorize the State Au- ” thority price fixing ‘in its discretion’ to establish a plan. improper Arkansas Under the act there is no such delegation legislative power to an administrative lays price fixing- board; the enactment itself down the rule. holding appears Schwegmann
The Louisiana Bros. Beverage v. Louisiana Board Control, Alcoholic La. 2d 248. So. The statute there was similar to purpose that regulation “may in Arkansas, enacted and its stated was and control of the traffic so that it injury not cause to the social and economic, moral well-being people of the state.” The Louisiana package held that Court of wholesale and retail liquor prices was insufficient itself to achieve the sought, many liquor end that there were too sales trans- prices unregulated, actions which were left that comprehensive enough accomplish act was not what purported accomplish. emphasis it Particular regulation prices laid on the fact that there was no type on sales of over the bar drink, sale which we do not allow in Arkansas, therefore regulate. objection no occasion to No is made that sufficiently comprehensive; the Arkansas statute argument regulate enough, no made that does not urged regulates rather it is that it too much. The Lou- clearly isiana concluded: “It is to understood holding legislature are not that the we cannot under adopt legislation, pursuant circumstances to the police power, relating establishing state’s *5 purpose regulating on with the intoxicants view and of protecting general traffic and the the welfare of people. question presented That broad spe- question is . . that broad Contrariwise, «aso cifically Court. before tlie Arkansas that now is price-fixing plan state which
The other Liquor v. Florida, where Store invalidated is has been Distilling Corp., (Fla.) 2d 40 So. Continental enforce an act which author- refused to Florida Court binding prices fix retail on “brand manufacturers to ized goods for resale in the state. The Court sold name” pointed to remember also that this out: “It is well act every including applies kind of article such necessities to ’’ drugs. Then was “. . . stated: a law as food prices fixing provides minimum for the should yardstick guide for the as a establishment contain prices. power ground determine those to level such prices discretion left to the unleashed should not be im- within measuring but should be confined owner the trade-name specified pregnable A definite boundaries. body This in the the'act. set forth should be
stick Arkansas statute such rule.” The contains no very specific be- rule, one, such a contain does up price for the structure it sets sides distinguished from all retail businesses. business, Simon, cases is contrast with these Reeves In Kentucky’s Ky. sustained 160 S. W. price fixing Spirits Fair Trade Act, and Wine Distilled The de 282 of 1949. similar to Arkansas’ Act measure constitutionality squarely of the enact cision Kentucky opinion In course its ment.
said: price-cutting proof shows that
“The due competition producers,' and re- wholesalers cut-throat resulted in law in the trade which chaos existed tailers, intoxicants and other condi- use of violations, excessive The evidence is to the commonweal. tions detrimental fixing minimum had a has that the the effect with, away industry, stabilizing done ruin- effect consumption competition, of intoxi- in less resulted ous public sold in has caused cants surroundings . more wholesome *6 566
“ (It urged that) mark-up price in the resale was for the sole benefit of the dealer and that Act the. ran afoul of section 3 of our Constitution which forbids granting privileges of exclusive emoluments or ex- cept public anybody for service. The natural status that might whiskey long sell has ceased since to exist and its police power years sale under has been limited to persons places select at selected . argument “The answer to the that this statute more to enrich the regulate inclined dealer than it is to whiskey public the sale of for the benefit, is that courts appropriateness not concerned with wisdom legislation, public but the benefit to be derived there- adequacy primarily from and the thereof is Leg- for the islature. it is clear Unless has no reasonable proper legislative purpose relation to a arbitrary and is discriminatory and without substantial basis, the courts will.-not interfere.
“Innumerable methods have been devised legislatures of the several states, and some the na- congress, attempt properly regulate tional in an great traffic —none of which have met with suc- say calling cess—and cannot we that the instant law strict control and the elimination of ruinous com- petition subject has no relation to the or that it is arbi- trary discriminatory and not based substantial grounds.”
Many price-fixing other states have enforced laws of one kind or another, but most of these are irrelevant approve nor do we now them either here, inference or otherwise. It is established that such enactments not. do process, equal protection, privileges violate the due possibly immunities, other relevant clauses in Fed eral Constitution. Nebbia New York, v. 291 U. S. 502, 54 L. 505, 940, S. Ct. A. R 79 Ed. 89 L. v. 1469; Olsen Nebraska, 313 U. S. 61 236, 862, S. Ct. 85 L. Ed.
A. L. R. 1500, therefore it is clear that the Arkansas
liquor price
control act
not violative of the Federal
enforcing Constitution. Decisions
controls over
not deal with
do
sales in still other states
and beer
questions
we
before us here
the constitutional
Corp.
L.
Driscoll,
v.
N. J.
—see Grant Lunch
Md.
The fact remains that the earliest of admittedly regulation liquor our laws, valid, now have liquor special privilege granted a dealers much more to monopolistic, anything farreaching, than more contained engage liquor is the to in the in Act 282. This license to the exclusion unlicensed sellers. This of bootleggers “special privilege” of have tradition- which ally complained, gives liquor and which dealers a given profit of the that is to' substantial assurance law-abiding Arkansas, citizens. Yet courts of other states, those of all American sustained these like have monopolistic special privilege ground grants of on the competency legislature it is within the of the to de- that police power regulatory what termine under the rules are type fraught controlling of business with needful safety public peace, perils is the health as business. legislative policy
The recital of section of Act purpose avoiding price wars “of which asserts the materially of the at- State, affect the would revenues monopolies, tempts the demoralization at liquors legally sale in this State which controlled manipulation.” grows The effect out of unfair least harms of the revenues one of the State unregulated liquor would flow an traffic. Unlawful offering sales samples, of free drunkards, to minors and sales effort increase cut-rate freely competitive practices com- other allowed and monly encouraged in other harmless fields of and more among against legis- commerce, are evils our guard. lation seeks to century sought
For a have with more we to deal dangers grant special privileges such assumption sellers class, limited num- grantees special privilege ber of more could be easily regulated generally. than could unlicensed sellers century legislatures In the course of the our de- have many regulations vised for the trade. Some today. them have been others are retained abandoned, major- regulations opposed Some our been ity dealers because the rules were onerous *8 regulations pleased other burdensome, the dealers they away costly competitive served to with because practices, do bootleg
to eliminate sales, untaxed to forbid public antagonism, business methods which aroused or impose procedures proved to other limitations or financially profitable law-abiding dealers. valid- The ity legislative by regulations of these is not to be tested they produce profit whether or less more to the regulations pleasing or dealers, whether the are or displeasing regulated legisla- to the dealers. Rather, judgment tive is the test. opinion
There room is much for difference of as to whether the of minimum sound wise achieving power legitimate police method for ends regulation. opinion of traffic The of writer this majority colleagues and per- of his on this Court feel sonally price fixing that such minimum is unsound and point unwise, but our views on that are irrelevant here. price regulation Others believe that tend does to remove dangers some of the that inhere and traffic, gives that to the state a firmer control than could otherwise be maintained over the traffic and its inci- point dental evils. That an understandable view, of judg- intelligent appealed apparently and one that legislature legislature. The ment of members remedy, remedy seeking a it is authorized to ills that remedy remedy, of was not or seek to and its choice prohibited to it our Constitution. Chancery is affirmed. The decree part. J., dissent and McFaddin, Chief Justice Dunaway, participating. J., (dissenting). This suit F. McFaddiN, Justice Ed. constitutionality of Act attacks the Act 282 objectives: has three (1) provide penalty fix the —To (§§ at different sale 1 to inclusive, attempts accomplish objective)
15§ this ; (2) levy liquor (§ an additional tax —To attempts accomplish objective); Act 282 this (3) employment twenty authorize addi- —To paid tional enforcement at office's salaries to be from (§§ attempt levied § tax 14-A of the Act accomplish objective). challenge constitutionality
There is real no as to the Objective (that levy), Objective is, No. 2 the tax (that regard emplo3ment); objec No. is, and I these clearly Objec constitutional and tives severable employment pro tive 1.No. In other the tax and words, visions constitutional. *9 Objective
This dissent directed to much of so liquor No. 1 of Act as fixes a minimum price. regard forbids sale at less than such minimum I legislation granting privilege such as a dealers in violation of two sections of our These Constitution. says: Article 18 of II, § are our State Constitution, which ‘ ‘ Assembly grant any The General shall not to citizen or privileges class citizens or immunities which equally belong not same terms shall all to citizens1 ”; City 100, In Edelmann v. Fort 194 Ark. 105 S. W. Smithy 528, granting immunity held that a statute we tax to World War yet unconstitutional, guarantees Veterans the Act 282 of 1949 profit guaranteed a dealers which is not to other citizens. says: Constitution, which 19 of our II, § also Article “. State privileges . . . ever be . . . . . nor shall granted . . in this State or conferred Levy, early Ark. 42, case of Parte
In the Ex case), Rep. (also liquor Eakin, Mr. Justice a Am. priv language, considering said aof this constitutional ilege : peculiar right according or Burrell,
“It lo some is, contrary general granted rule—an law favor duty immunity general exemption or bur- or from some body per- right peculiar individual or den—a to some —a verb.).” (see favor Bur. Law Die. sonal benefit or are effect, To the same see 50 wherein cases C. J. say “privilege” word means: cited which that the n advantage; peculiar peculiar or benefit “. a a advantage; peculiar advantage; a or a benefit, favor, private personal personal favor favor; a or benefit particular enjoyed; peculiar ... a benefit beyond enjoyed person, company, privilege, or class peculiar advantages citizens; of other the common some granted by contrary general right or favor law ...” rule; Dictionary says “Exemp- privilege
Bouvier’s Law is: subjected tion from such burdens as to.” others point prohibits I make the that our Constitution granting group advantage enjoyed by an all groups; point and I make the Act 282 1949— liquor may minimum insofar fixes “peculiar grants advantage” dealers, sold— legislation guaranteeing because such State gross profit in their them a whereas the State business, profit guaranteeing gross mer- farmers, is not such n group barbers, doctors, or other in our chants, eco- system. nomic guarantee gross profit
That the Act does such a definitely stated in §§ 4, dealers 10 and
571 guaranteed liquor 282.2 are Act Wholesale dealers said cent, per gross profit and retail dealers cent, depend profit, per gross guaranteed to 33]/$ anyone attempting type ing to sold; on of and prosecution. price subject to at less the fixed sell than gross profit, guaranteed a short, In dealers are permits right them and because State has the to issue industry proposes keep the State “healthy by prohibiting dealer from condition” underselling group is another. "Whatother favored thus in our State? years attempted ago the
Several barbers of this State prices fixed; their of 1941 to have and Act 432 adopted, under the State Board of Barber Exam- forty fixed iners price of haircut at cents and the twenty Litigation of a shave cents. at ensued price-fixing this and test it was held unconstitutional law, Davis, 156, in the case of Noble v. 204 Ark. 161 S. W. opinion Mr. McHaNey Justice delivered the of this spoke language against in that case and Court out clear price fixing: entire evil “ legislation, fixing prices, ‘This class that is, likely Supreme and new resulted from the decision of the of the United States Nebbia v. New York, 505, S. Ct. 78 L. Ed. A. L. R. U. S.
2 These sections read: selling price “Section 3. The wholesaler’s the retailer shall (as Act) be his cost defined in this and determined the Commis- Revenues, plus mark-up per (15) sioner of fifteen cent of cost on (15) liquor, fifteen such per cordials, liqueurs, specialties, fifteen cent on (15) per wines, sparkling' cent on and still and he shall deliver liquors charge at retailers such additional without delivery. selling price (as “Section 4. The retailer’s shall be his cost Act) Revenues, defined and determined the Commissioner of plus mark-up thirty-three (33%) per and one-third cent of cost liquor, forty-five (45) per cordials, liqueurs, specialties, cent on fifty (50) per sparkling cent on and still wines. Any rebates, loans, special gifts, “Section 10. or other induce- offered, given accepted by ments either wholesaler retailer shall requirements Act, be considered evasions of the of this .” Any person provisions “Section 15. who violates Act guilty this tion shall be fined not shall be deemed of a misdemeanor and convic- ($100.00) than less One Hundred nor Dollars ($500.00) any permit more than Five Hundred Dollars and which has person may been issued to such so convicted shall be revoked and again person period years.” (2) issued two such
572 in which the sustained a 1934,
decided March court 5, price of millcin New York. dissent by A ing opinion in case, filed that concurred in four fixing prices members of court. The various acts charged to which our barbers, he attention has been passed were since the decision the Nebbia directed, case.’ following The are some of the cases where the legislation have held similar invalid, courts to the in addition City Tennessee case: Duncan v. Moines, Des 547; N. W. 218, State, 222 Ia. ex v. Ives, rel. Fulton 401, Rouse, 123 Fla. So. Mobile v. 233 Ala. 394; Hollingsworth L. 173 So. 111 A. 349; R. State Board Barber 217 Ind. N. E. 2d Examiners, decisions all cases are based these on the fact that regulatory, the statutes of those states are not are but price-fixing delegation power mere or a statutes, prices fix board, to a no real or substantial public safety, prosper relation to the ity, health, welfare or distinguishable thus from the Nebbia case. In the Tennessee the further case observation is made: question Legislature ‘If the act in valid, then the can directly, through physicians board, fix the fees that may charge prices and dentists for their services; may charge that restaurants and hotels, lunch counters prices packing canning food; of meats, house and factory products; liberty and so on ad until the finitum right destroyed.’ the individual and the to contract is agree principles We with the in this announced case and might the other cases above cited as also others that be ’’ cited. regardless “price fixing” Thus, in other States, the fact remains that we declared it unconstitutional supra. Although Davis, Noble v. we held that barbers prices, yet majority allowing could not fix is now liquor protected having dealers to be their fixed. respected The trade of a barber is an old trade, liquor always whereas the dealer lias been one yet dangerous guaranteeing gross of a nature; we are profit refusing gross profit after dealers, such a singles group— to barbers. This Act of 1949 out one guarantees privilege dealers—and them system. groups denied economic we have to other our it Therefore I submit that unconstitutional insofar as price liquor. puts a floor on put a if the State does not minimum is said that It the State will war, there will he on argument. The This is a fallacious State revenue. lose just liquor, get whether sold as much tax will profit or at a dealer. Have conditions at a loss place prohibit where the State must mer- reached *12 having money? sales, for from fear some will lose chants system certainly great enterprise danger is in free The are afraid to trust a merchant his if we to run business may money by goods selling he lose fear his too cheaply. guise protecting this under No, Act, the the granting privilege liquor is revenue, to the State deal- rightly has which been refused the barbers 'in ers the guaranteeing profit— The idea of ease cited. whole industry contrary gross or net—to an is our Constitu- majority distinguish price fixing The seeks to tion. the dealers refused the barbers saying sphere. that the business is in a distinct My argument is, to such answer that the Constitution grant liquor group any privileges the does refused groups, and the other Constitution should be the guide.
is It true that in some of our cases we have said that “privilege” existed business at of the In Cook, State. Commissioner v. Glaser’s Wholesale speaking Co., 209 Ark. 189 S. in W. 2d Drug. liquor permit, privi sentence was used: “The this conditionally leges permit extended witli cannot be abridged nor terminated at the whim of an administrator “privileges,” quoted .” word The in as the sen synonymous used per was as with tence, or sufferance In mission. other words, the cases in which we have spoken operating of the privilege as at the “privilege.” engaging the word State, as meant right in a business that was not a matter of but a matter being permitted by clearly of by the State. This is reflected language Levy, of Mr. Justice Eakin in Ex Parte Ark. 43 42:
‘‘ confessedly occupations are some trades and There safety, dangerous public, or health, either as to or regulate power to morals. has the inherent Government prohibit presumed them. It is not that constitutions prohibit salutary power. The meant exercise liquors As as other, retail of is one of them. lawful permitted, fully protection, when and as entitled to it per- questions withholding giving nevertheless dangerous.” considered mission, majority allowing operates The business, permission, acquire special privilege to now Kentucky of our violation Constitution. case of Ky. 793, Reeves Simon, W. does not S. justification seem to me to sufficient for the evasion of our Constitutional as contained Article inhibitions, previously quoted. respectfully II, §§ 18 I Kentucky majority submit that neither the nor the case opinion argument case at bar answered has points pro- out that the Constitution of our State granting privilege. hibits of a That Act 282 grant privilege puts does such a clear, because it *13 price liquor. minimum on the sale of right put price That the State has maximum on because the clear, is of such a regulated; engage nature that it must be and those who get permits in it must their from the State on such terms impose, as the State desires to and one of these conditions engaged that those the business must not sell above price. price a certain So the maximum is con- putting price stitutional. But the of a floor on the of the anyone prohibiting selling liquor article and at less than a fixed unconstitutional, because effect legislation guarantee profit of such is to deal- give privilege ers and to them a in violation of our Con- stitution. respect- for reasons
Therefore, herein I stated, fully portion majority opinion dissent from that to be constitutional holds the section of Act 282 of liquor. which fixed minimum on the sale of say 1 am authorized the Chief Justice has read dissenting opinion herein and concurs with the views opin- may dissenting stated later issue an additional ion of his own. Bayou Drainage
Flat District Jefferson County Atkinson. 232 W. 2d
4-9220 S.
Opinion April delivered Triplett, appellant.
A. F. appellee.
R. A. Zebolcl, Chief Justice. L. Atkinson as S. Smith, Griffin property-owner Bayou Drainage sought of Flat District enjoin County petitioning the Commissioners from levy against predetermined Court to additional taxes bet- *14 terments of $208,490.15 that were ascertained when general District under created laws 1917. It was alleged that bond new issue of $91,000 use recon- ditioning, reconstructing, repairing proposed by (a) District could not be sustained residual tax sources because levies made from time to time had, aggregate, (b) exceeded benefits 25.8%, comply provisions there was no intent with