State v. Missouri Athletic Club

• Citation: 261 Mo. 576,170 S.W. 904
• Decision Date: 27 October 1914
• Docket Number: No. 18053.,No. 18052.,18052.,18053.
• Parties: STATE ex inf. HARVEY, Circuit Atty., v. MISSOURI ATHLETIC CLUB et al.
• Court: Missouri Supreme Court

170 S.W. 904

261 Mo. 576

STATE ex inf. HARVEY, Circuit Atty., v. MISSOURI ATHLETIC CLUB et al.

No. 18052.

No. 18053.

Supreme Court of Missouri.

October 27, 1914.

Rehearing Denied November 17, 1914.

1. INTOXICATING LIQUORS (§ 146) — "SALE" — SOCIAL CLUB.

Where an incorporated social club furnishes intoxicating liquors to its members at a clubhouse, keeping an account of each transaction and requiring the member at stated times to pay for what he has received, this is a "sale," within Rev. St. 1909, § 7188, prohibiting the sale of intoxicating liquors without a license, when such section is liberally construed pursuant to the express requirement of section 7222.

2. CLUBS (§ 9) — INCORPORATED SOCIAL CLUB — POWERS — INTOXICATING LIQUORS.

A social club, incorporated under Rev. St. 1909, §§ 3432-3445, providing for the formation of benevolent, religious, scientific, educational, and miscellaneous associations, has no power, express or implied, to sell intoxicating liquors to its members.

3. CORPORATIONS (§ 374) — "INCIDENTAL POWERS."

The term "incidental powers," within the rule that a corporation possesses only those powers which its charter confers upon it, either expressly or as incidental to its existence, means such powers as are directly and immediately appropriate to the execution of the powers expressly granted and exist only to enable the corporation to carry out the purpose of its creation.

4. CORPORATIONS (§ 370) — "IMPLIED POWERS."

The "implied powers" of a corporation are such as are not indispensably necessary to carry into effect others expressly granted, and comprise all that are appropriate, convenient, and suitable for that purpose, including as an incidental right a reasonable choice of the means to be employed in putting into practical effect this class of powers.

5. INTOXICATING LIQUORS (§ 58) — RIGHT TO PROCURE LICENSE — CORPORATIONS.

A social club, incorporated under Rev. St. 1909, §§ 3432-3445, cannot procure a retail license as a dramshop keeper under section 7188, which license, under the express provisions of section 7191, can be granted only to a "law-abiding, assessed taxpaying male citizen over twenty-one years of age."

6. CLUBS (§ 3) — INCORPORATION — APPLICATION OF STATUTE.

As used in Rev. St. 1909, § 3435, which authorizes the incorporation of benevolent, religious, scientific and educational associations, and provides that any association, company, or organization which tends to the public advantage "in relation to any or several of the objects above enumerated, and whatever is incident to such objects," may create a body corporate, the words quoted have no application to an incorporated social club, even though it be incorporated under such statute.

7. COURTS (§ 93) — STATUTES — JUDICIAL CONSTRUCTION — EFFECT.

The construction placed on a statute by the highest court of the state becomes a part of the original text only when it will not affect contract or property rights.

8. CLUBS (§ 14) — FORFEITURE OF CORPORATION CHARTER — SALE OF INTOXICATING LIQUORS.

That a social club, in reliance on a construction placed by the Supreme Court on the dramshop act (Rev. St. 1909, §§ 7186-7229) in a decision adjudicating the rights of social clubs to sell liquor without a license, and on legislative acquiescence in such decision through failure to enact any subsequent law affecting its subject-matter, has enjoyed the privilege of selling intoxicating liquor and made expenditures in anticipation of the continued enjoyment of such privilege, will not preclude a forfeiture of the club's charter for abuse of its corporate powers by keeping and selling intoxicating liquors.

En Banc. Proceedings in the nature of quo warranto by the State, on the information of Thomas B. Harvey, Circuit Attorney, against the Missouri Athletic Club and another. Judgments of forfeiture entered, but suspended on condition.

Thomas B. Harvey, Circuit Atty., and R. P. Spencer, Asst. Circuit Atty., both of St. Louis, for informant. E. T. &. C. B. Allen and William C. Connett, all of St. Louis, for Missouri Athletic Club. A. & J. F. Lee, of St. Louis, for St. Louis Club.

WALKER, J.

The circuit attorney of the city of St. Louis has instituted two original proceedings in this court in the nature of quo warranto for the purpose of forfeiting the charters of two corporations, the St. Louis Club and the Missouri Athletic Club, because of their alleged misuse and abuse of their respective franchises in having sold, without licenses as dramshop keepers, intoxicating liquors, and in having violated section 7226, R. S. 1909, in receiving, storing, keeping, or delivering, as agents or otherwise of any other person, intoxicating liquors without having licenses as dramshop keepers. The material issues in these cases being identical, varying only as to the manner in which the defenses are presented by counsel in each of the cases, they will be considered together.

These clubs were incorporated at different dates under what is now article 10 of chapter 33, R. S. 1909, the statute authorizing the incorporation of benevolent, religious, scientific, educational, and miscellaneous associations. This statute has not undergone any material change through legislation since the incorporation of these clubs. Incidentally, its latitude, measured by judicial interpretation, may not inappropriately be likened to that virtue which is figuratively said to cover a multitude of sins. 1 Peter, iv. 8.

No useful purpose will be served by setting out the pleadings at length. The informations formally charge the respondents with the abuse and misuse of their corporate powers in reference to the matters above stated, and ask a forfeiture of their charters. Their returns confess and avoid as to the charge of selling intoxicating liquors without license, and as to the alleged violation of section 7226, R. S. 1909, that it is invalid, as being unconstitutional. The buildings, appointments, conditions of membership, privileges, government, and exclusive restrictions of each club is set forth at length and with particularity. It is pleaded that the matter of the right of these clubs to sell liquor without license has been adjudicated by this court in Bell v. St. Louis Club, 125 Mo. 308, 28 S. W. 604, 26 L. R. A. 573, and that the right under this decision has uninterruptedly been exercised by them since the rendition of the opinion in that case in 1894; that efforts have been made at successive sessions of the General Assembly to effect changes in the dramshop law which would require social clubs to take out dramshop licenses, and the failure or refusal of the Legislature to enact laws of this character is a construction of the dramshop law by the state, represented by its officials, authorizing sales of liquor without license by such clubs. Whereupon respondents plead that such failure or refusal on the part of the law making power operates as an estoppel upon relator from claiming that the dramshop law applies to bona fide social clubs; that respondents, relying upon the fact that they have never heretofore been molested in the sale of liquors without license, or in the violation of section 7226, supra, have expended large sums of money in furnishing and equipping their clubhouses, and that relator, by reason of the nonaction of the Legislature and the failure of the law officers to proceed against them for years after respondents had organized and were in operation as social clubs, should not be heard to complain against them.

Relator's reply in each case is a general denial, and in addition in one it is alleged that the suit pleaded in abatement by respondents (State ex rel. Bell v. St. Louis Club, supra) was brought by an unauthorized person and the proceedings therein were void, and that the facts in that and the instant cases are not identical, and that section 7226, supra, had not been enacted when the Bell Case was determined.

Agreed statements of facts detail the character of each club as a social organization, the nature and amount of its expenditures, including the expenditures for intoxicating liquors, the nature and amount of income, including that charged to members and their nonresident guests for intoxicating liquors, the manner in which the club is governed, and numerous other matters not necessary to be set out here. As to the dispensing of liquors, practically the same plan is pursued in each club. If a member desires liquor, he orders same, and it is served to him in the club. On receiving it, he signs a card acknowledging the receipt of same and stating the price. He makes payment for same within a stated time thereafter. Stress is laid in each statement upon the member receiving the liquor and not paying for it at the time, and that he is not permitted, under the rules, to pay for the liquor when received, but subsequently, when he pays for his supplies for the month, and as a part of such supplies; that the same prices are charged members for liquors as are required to be paid at licensed cafés and dramshops for like goods; that the money received by respondents for liquors is mingled with the other funds, and used in replenishing the stock of liquors and in purchasing other supplies; that no profit has ever been made by these clubs, or paid to members. A complete statement of each club's entire accounts for the preceding year accompanies the recital of the agreed facts.

The questions confronting us are so interrelate] that their discussion, with probably some prolixity, becomes necessary to a determination of the issues involved.

I. It is scarcely worth while at this day and time to consume space discussing the character of the liquor traffic, except to say that early in our judicial history Judge Napton, who may well be styled the Story of our jurisprudence, said, in Austin v. State, 10 Mo. 591, that:

"The sale of intoxicating liquors is by law illegal — is not a privilege of a citizen of this or any other...