*1
397
803
So.2d
217
created.....”
corporation was
the
Cleage, 246 Ala.
Co. v.
Trust
Nashville
COMPANY, Inc.,
ANN
SAN
et al.
TOBACCO
513, 516, 21
441.
So.2d
25,
provides
the shares
51,
Title
§
Phillip
HAMM,
Revenue.
Commissioner of
person in
the
whose
“to
assessed
shall be
‘capital’ stock’ funds meaning reserve stock,’ funds still would ‘capital these
are reach of
not be within § capital stock the cor- tax not on corpo-
poration the shares hut on in whose name person eto the ration corpora- hooks
shares stand there corporation’, tion and not to au- none are shares of stock no Sup- (Emphasis
thorized.....” County Exchange, DeKalb
plied) State v. 217, 219, 220, 810. Ala. 43 Co., 254 Metals
See Southeastern 182.
Ala. State, Ala.App.
See Pratt v. also: 163; cert. den.
So. 165. provisions opinion that
Being of seq., provide adequate no-
Title 25 et shareholders,
tice com- we hold that
plainants’ contrary contention
well taken.
Affirmed.
LAWSON, SIMPSON BLOOD-
WORTH, JJ., concur. *2 Gallion, Atty. Gen.,
MacDonald Willard Burton, Livingston W. and Wm. Asst. H. Attys. Gen., Gibson, Jr., E. White Somerville, Simpson, Lange, Robinson & Birmingham, appellee. Carnes, Albertville, T. and Earl Gil- J. lian, Montgomery, appellants. constitutionality
arettes; assailing the the Alabama Unfair amended, and enforcement relief Act. *3 overruled, the After demurrer to bill was appellant sought relief Tobacco pendente lite, court hearing and at a that Tobacco found from Act complying was not with retail at cigarettes in that it was County and in in other counties Jefferson a prices at it as in this state below cost to injure retailer with the obvious intent competitors destroy and to or substan- its by tially competition prohibited lessen as the Act. then a
The bill was amended show controversy over whether Com- Tobacco pany selling cigarettes as cost below Act, defined alleging proposed or offer at their to sell for sale County filling retail stations Jefferson cigarettes price of 1‡ a at a pack of below cigarettes it and its cost cost pur- doing connection with gallon gasoline chase of one gasoline cigarettes stations where the Inc., Service, sold, by adding San Ann party complaint. respondent’s a as MERRILL, Justice. general answer was effect denial originally an- assigned This case was general issue. member of the reas- other court and was the author signed of this hearing, After a the trial court rendered 29, 1968. July holding Cig- the Alabama decree Unfair Act arette Sales valid and constitutional appeal holding This from a decree holding aspects challenged bill, Cigarette Alabama as Unfair Sales corporate complainants “are the two amended, denying the constitutional and one,” complainants prove had failed to sought complainants appel- relief complain- business, their cost of Inc., lants, Ann Company, San Tobacco had sold a retailer ants as Company, hereinafter called defined in as the Alabama Un- Service, Inc., Ann called :San hereinafter Cigarette intent fair Sales Act with Company. injure competitors, destroy or substan- bill, tially competition, amended, lessen holding as suit n declaratory judgment against proposed sale of in connection the Commis- Alabama, purchase gasoline he sioner of Revenue of the with would State Act Act .alleging justiciable controversy that a under the ex- unlawful valid, parties holding that com- isted between the so construed was over cig- plainants come equity which Tobacco sell did not could into facts, hands, denying purpose clean all relief and dis- issuable sufficient for the missing pleading, respondent’s since the the bill. in- actual fact, costs, tent in selling prices and its The Alabama Unfair presumably matters within its knowl- Alabama is Act Acts of No. edge, greater particularity 83(1) seq., 1958 and listed as Tit. et required seem to be either to frame Recompilation. The amended Act was respondent charge issue or inform 1965 Act No. Acts of Alabama against required By to defend. p. Special Second Session. allegations, complain- these ant heavy proof, burden assumes held the This court Act to proof since must be far than more face, Simonetti, on its Inc. v. constitutional injury competitors mere intent *4 Gallion, ex rel. 132 So. State competition. of “unfairness” It must also appellants 2d do not attack prove, upon placed under the construction argue holding. appellants that one But do Act, selling spe- below cost with the part the 1965 amendment render of does substantially destroying cific intent of or the Act unconstitutional on its face. lessening competition, if since the only all, can valid be held so an ex- as pertinent part (Tit. The 3(a) of § police power ercise of the of the state over 83(3)) provided: of the intrastate inhibit- commerce to the end of ing practices tending monopoliza- toward any “It shall be unlawful for whole- tion. retailer, injure saler or intent with to competitors, destroy substantially or les- competition, advertise, sen to to offer “ ‘This opinion Court is of the that there sell, retail, ciga- or sell wholesale or ais valid “competitive distinction between rettes at less than cost to such wholesaler price-cutting” “intentionally destruc may or retailer as the case be.” price cutting, tive” purpose for ap of plication of our principles. constitutional
This sentence was amended 1965 and One of the declared leg emphasize intentions of the the five additional added words islature in this Act to safeguard pertinent which are to this decision: public against monopoly. creation of Not any “It shall be unlawful for whole- only is that scope police within the pow saler injure or retailer with intent to er, but the power exercise of that is af competitors, destroy substantially or les- firmatively enjoined upon legislature competition, sen or with the there- effect by Section 103 of the Constitution. of, advertise, offer to sell or sell examples factual Lindsey [Memphis of the wholesale or retail at less Laundry-Cleaners Lindsey, Steam than cost to such wholesaler retailer Miss. Bastrop 227] [Tooke * * may be, as the case Reynolds Co., & Bastrop Storage Ice & 172 La. vividly cases show quote 239] excerpts from the decision intentional and cutting deliberate Gallion, Inc. v. ex State rel. prices below cost has been be supra: can technique weapon monopolization. “ present ‘The directly bill alleges a dual This Court say cannot the declared specific or cumulative “injure intent intent is prohibit so far removed from the .competitors destroy substantially practice ed as masquer to make a mere competition” lessen respondent’s and that ade, upon and very from the face of advertising, sell, offers cig- and sale of Act itself. arettes at wholesale have been “at less “ than respondent.” cost to said These are ‘The the Court is further of the ultimate, allegations considered to that, in a b.e: business pub- not affected with a however, legislature may, 2. The concept in the interest, abides as that lie police power exercise the the state to Alabama, legisla- law monopolies, inhibit creation whether pricing regulate competitive ture cannot the business affected concerned with of “fair policies by standards declared public interest or merely not. competition,” and undertake practices with umpire pricing reference “ ‘3. selling of above the level of standards injure competitors with intent injurious in- commodities below cost with thereby substantially destroy or susceptible may in a tent business be which competition may lessen practice be a community. monopolization within monopoly, tends toward creation of “ and is police within power 'the “injury” competitors ‘If mere state whether or not police invoking to serve basis as the affected any public interest such. power prices, over basis operation, the Act’s not be “ ‘4. The Court say, as a mat- constitutional under All com- our cases. law, ter of on demurrer, that provi- petition competitors is intentional and all sion contained in the first sentence of necessarily injure competitors all other Section III (a) of the Unfair field, except same in rare cases of un- Sales Act is unconstitutional, null and *5 totally restricted and elastic markets. Com- void, upon its face. petition struggle is a to win. Whatever him, “ attract to in one does to customers ‘5. In order for the fairly Act to markets, necessarily “injury” inelastic to is subserve purpose of inhibition of others set a criterion the field. To monopoly, as distinguished pur- from the help cost does not the situation. Whether pose of merely procuring “fair” com- acquisi- a sells cutter below cost petitive prices as an itself, end in tion, plus or below that the cost of Act must be construed so as require to business, a plus or below both these costs dual, conjunctive, or in- cumulative living profit scarcely yield so small as a to tent injure to competitors and destroy or injurious family, for himself and his some substantially competition. lessen competitors to who result would accrue “ right they expect that a a rea- ‘In feel have to words, other where the comma profit. a air sonable merchant con- occurs When “competitors” between the words store, provides his “destroy” ditions or remodels or first sentence of parking, exceptionally pleasant treatment III(a) or Section conjunctive “and” customer, or more liberal credit must be Otherwise, understood. the Act extended, done, is ordinarily than is would fall within the influence of the sense, competitors, “injure” principles to who Kelly-Hunter loose cases, conditions, having will not meet these independent or an alternative based though be a man of such merchant how- injury competitors, on mere without good much will.” ever more. “ This court’s conclusions were: phrase ‘If the injure Competi- “To “ disjunctive tors” is from and alternative Kelly-Hunter line ‘1. Under the phrase “destroy to the substantially or state, legislature in this decisions competition,” lessen then a violation cannot, consistently with Sections 1 predicated upon could be an intent Constitution, regulate 35 of the State single single attract a customer from competitive prices prohibit bona fide or competitor, without reference that sub- cutting competitive price in businesses lessening competition stantial interest, mere- public affected with a not monopolistic tend- very is the essence of competi- ly in interest of fairness ency, arise paradox would else tion. Appellee argues question all com- say in effect that which would constitutionality not an should monopoly. If toward petition tends appeal alone because this could be decided competitor arise were injure a intend to found, phrase ground that the trial court on the sufficient, additional then the compe- did, “complainants as it were not substantially lessen that “destroy or continuously cigarettes at retail entirely redundant. be tition” is in North opinion that there other counties is of the Court Jefferson Alabama at prices in- mere which were below between important difference to them as under the but competitor and a destruction retailers jury to injure they competition, did the intent ‘to lessening of also so with or substantial substantially competitors, destroy alternative they lessen competition.’ the ef- phrase the Act must ‘or with and that equivalent, both, possible intent do has require fect thereof’ then no field construed ” required case, operation in as the this rather than either.’
‘intent’ has been
the evi-
established
dence.”
language quoted
view of the
ex rel.
supra
Inc. v. State
But
we cannot
Gallion,
supports
finding.
evidence
such a
Neither
why the five words
difficult to understand
support
have we found evidence
3 of
added
amendment
President,
finding
“complainants’
Mr.
words,
the effect
“or with
Act. Those
Scott,
testifying
the stand admit
when
thereof,”
the stat
all intent from
remove
ted
sold
as ‘loss leaders’
only “inten
renders unlawful not
ute and
Appellee
filling
their retail
stations.”
also
price cutting” but
tionally destructive
“True,
particular
concedes
brief:
“it
price cutting”;
“competitive
(Scott)
asked the direct
witness
was not
*6
competi
‘injure’
sense,
done,
a loose
in
question
point
not himself
on
and did
these
tors,
not meet
will
who
or
testify
company
at a
was
conditions.”
loss.”
change the
The five words
statute to
findings
result
We think these
were the
price fixing
un-
law such as has been held
being confused with Scott’s
of
Goldstein, 207
in State v.
constitutional
support
in
proposal
his
the court
308;
City
of Mobile
93 So.
approve
pack-
proposed plan
to sell
Rouse,
266, 111 A.L.R.
233 Ala.
age at
below cost in connection
1‡
Griffin,
349;
242 Ala.
Lisenba
gasoline
sales
let
and
the Tobacco Com-
Independent
S.
and Alabama
S.
pany
profits
be reimbursed from the
McDowell,
A. v.
In 571, 273 Ala. 143 So.2d which contained the five words which ren- 444, we also said: unconstitutional, dered that Act (2) If Act No. 805 remains in full force “ * * * employed analyz- The method effect, are the other amendments contained ing and breaking down the costs was effective, in Act No. 78 or is Act No. 78
general acceptable accounting procedure. entirety? unconstitutional in its This was the of the accountant referred in the of the trial City Bessemer, 87 Ala. Judson court, and supports this evidence 240, 267, 742, 6 So. 4 L.R.A. amendment an. finding appellee of the trial court that 38 of the Charter Bessemer was was not his ac- unconstitutional, said, held and the court tual cost.” amending act, being “The unconstitutional void, has no force or effect whatever. unaffected, Section 38 remains and as finding with the State, originally passed. 26 Ala. Tims v. that appellants equity came into with un 165.” clean hands. We have held that the doc applied trine unclean hands can be ato Corporation In Frost v. Commission of litigant if guilty unscrupu been he has “of Oklahoma, 49 278 U.S. S.Ct. practices, lous overreaching, or has con 483, it L.Ed. was said: important facts, cealed though even actually fraudulent, guilty or been trick “ * * * But since the amendment ery, taking posi advantage undue of his unconstitutionality, void it cannot tion, conduct, or other then unconscientious given effect, existing an ‘because equity although may deny relief, court of statute recalled cannot be or restricted may such not constitute a defense at law.” by anything short a constitutional en- 951; Little, Harton v. Wallace, actment.’ Davis v. U.S. [257 Pool, Weaver v. 644, 32 325], L.Ed. S.Ct. and cases there cited. supports We do not think evidence statute, “Here is conceded finding in the instant case. entirely amendment, before the expressed the passed, valid. will When statute, Having decided that Legislature enacted it. amended, face, is unconstitutional express repeal, a different Without *9 necessary respond do not deem to Legislature an ex- undertook create assignments argued of error but, body ception, sought to brief. which, express its an amendment will and, nullity unconstitutional, is a being Reversed and remanded. 406 thus,
therefore, together, and powerless change work stand or fall No. statute, entirety. existing in its that statute must 78 has been stricken expression stand as the valid Opinion application extended legislative intent.” rehearing overruled. appears uniformly It held that attempt- where valid act and is a there LIVINGSTON, J.,C. and SIMPSON it, ed but unconstitutional amendment HARWOOD, JJ., concur. original affected, act remains but
in full force and effect. 66 Annotation 1483; Opinion Justices,
A.L.R. Re 269 1477; 611, 536,
Mass. 66 168 N.E. A.L.R. Statutes, 270; C.J.S., Am.Jur.2d,
82 16 § Law,
Constitutional 184. § 811 217 So.2d Having amendment held uncon stitutional, necessarily follows that Betty BROADUS Ann enactment, 805, Act No. we held to be constitutional on its face State, Inc. 272 Ala. BROADUS al. Charles Edward et 132 So.2d remains itnaffected and Div. 529. 1 continues to be effective. Supreme of Alabama. Court 16, 1969. Jan. question, As to the second we hold that Act was unconstitutional No. 78 nullity Legislature
was a in toto. evi
dently intended it be considered in toto customary “separ
because the usual
ability” “severability” section was omit amending
ted from the statute. recognize separability that a given effect,
clause pos should be where
sible, legislative to save a Al enactment. County,
len v. Walker 854;
2d Alabama State Federation of McAdory,
Labor v. 246 Ala. (We severability
810. it a called clause Underwood,
in Hall v. [16].)
Here, of such a absence clause in
Act No. in connection with the fact part the Act discussed
original opinion clearly of doubtful
constitutionality, as we stated —“it why
difficult to understand the five words
were added amendment to 3 of the Act,” give evidentiary strength to our Legislature
conclusion that intended
for all amendments Act No.