American Bakeries Co. v. City of Opelika

• Decision Date: 11 October 1934
• Docket Number: 5 Div. 181.
• Citation: 229 Ala. 388,157 So. 206
• Parties: AMERICAN BAKERIES CO. v. CITY OF OPELIKA.
• Court: Alabama Supreme Court

157 So. 206

229 Ala. 388

AMERICAN BAKERIES CO. v. CITY OF OPELIKA.

5 Div. 181.

Supreme Court of Alabama

October 11, 1934

Rehearing Denied Nov. 8, 1934.

Appeal from Circuit Court, Lee County; W. B. Bowling, Judge.

Action by the American Bakeries Company against the City of Opelika to recover license paid under protest. From a judgment for defendant under its plea of set-off, as license for part of a year, plaintiff appeals.

Transferred from Court of Appeals.

Affirmed.

White E. Gibson, M. Leigh Harrison, and White E. Gibson, Jr., all of Birmingham, and Samford & Samford, of Opelika, for appellant.

E Herndon Glenn, of Opelika, for appellee.

GARDNER Justice.

On December 20, 1932, the city of Opelika, in adopting a license code, and providing a schedule of licenses for certain trades, businesses, occupations, and professions for the year beginning January 1, 1933, and ending December 31, 1933 provided as follows:

"8. Bakeries-For each person, firm or corporation engaged in the business of operating a bakery, 12 months only-$25.00.

"9. Bakeries-or agents of bakeries or distributors of bread who do not bake in Opelika and who sell to merchants or at wholesale, 12 months only $75.00."

Plaintiff, American Bakeries Company, is a Georgia corporation, but is duly qualified to do business in this state, and has been so engaged for more than ten years, with manufacturing plants both in Birmingham and Gadsden of this state, as well also in Atlanta, Ga. It is engaged exclusively in the business of manufacturing bakery products which it sells at wholesale to retail dealers, and not directly to the consumer.

The corporation (to so designate plaintiff for convenience) has in Opelika no bakery, but an agent who sells and delivers its bread, sent direct from Atlanta, to merchants of that city, and collects therefor, the agent working both on a salary and a commission basis. The sales by the agent were not confined to regular merchant customers, but he sold to "any merchant who wants to buy." The bread is first brought to his home and there stored until he is ready to carry it in the truck to sell and deliver to merchants. As to regular customers, they take the quantity desired, but with no previous agreement therefor. The agent uses a truck of the corporation, but if necessary at times uses his own car, or one rented. His deliveries and sales are not confined to Opelika, but he travels outside territory of some fifty or sixty miles.

The city demanded of the corporation the license fee of $75, under the provisions of schedule 9, above set out, which was on February 14, 1933, paid under protest, and on March 3, 1933, formal demand for a refund was filed with the city clerk. On March 13, 1933, the corporation made application to the mayor and city council of Opelika for a refund of said license, which demand was refused. The demand by the corporation for a refund was based upon the contention that the above-noted ordinance schedule was unconstitutional and invalid because of an arbitrary distinction between persons engaged in the same business, rested as it was upon the sole matter of location of the bakery, and the following among other authorities are cited: Bethlehem Motors Corporation v. Flynt, 256 U.S. 421, 41 S.Ct. 571, 65 L.Ed. 1029; Chalker v. Birmingham & Northwestern R. Co., 249 U.S. 522, 39 S.Ct. 366, 63 L.Ed. 748; Ward Baking Co. v. City of Fernandina (D. C.) 29 F. (2d) 789; Simrall v. City of Covington, 90 Ky. 444, 14 S.W. 369, 9 L. R. A. 556, 29 Am. St. Rep. 398.

The attorney for the city seems to concede the point is well taken, and on the day the corporation made application to the city council for the refund (March 13, 1933), another ordinance was adopted, which reads as follows:

"An Ordinance.

"Be it ordained by the city council of the City of Opelika, as follows:

"1. That for each itinerant dealer or trader in bread, commonly known as loaf bread or light bread, in the City of Opelika, or within the police jurisdiction thereof, there shall be levied and collected an annual license tax of seventy-five ($75.00) Dollars, and such license tax shall be paid before such itinerant dealer or trader shall be permitted to make any sales.

"2. That for such itinerant dealer or trader in potato chips, peanuts, cakes, candies and confections, in the City of Opelika or within the police jurisdiction thereof, there shall be levied and collected an annual license tax of ten and 50/100 $10.50 dollars, and such license tax shall be paid before such itinerant dealer or trader shall be permitted to make any sales.

"3. Any person, firm or corporation violating this ordinance shall be subject to a fine of not more than five hundred ($500.00) dollars, in addition to being required to pay such license and each sale shall be considered a separate offense.

"Approved March 13, 1933

"Adopted March 13, 1933.

"H. K. Dickinson, Mayor,

"W. S. Harris, Clerk."

We think it clear that this ordinance was intended as a substitute for that part of the schedule in the previous ordinance to which plaintiff had interposed objection, and thus effected its repeal by implication. 43 C.J. 564; Barton v. Incorporation of Gadsden, 79 Ala. 495.

The validity of this latter ordinance (March 13, 1933) does not appear to be seriously questioned. It is well settled that a schedule of licenses may be prescribed for an itinerant person, firm, or corporation different from that prescribed for one having an established place of business within the municipality. 37 C.J. 227, 228; State v. Cater, 184 Iowa, 667, 169 N.W. 43, 46; Levy v. State, 161 Ind. 251, 68 N.E. 172; Mathison v. Brister, 166 Miss. 67, 145 So. 358; State v. Harrington, 68 Vt. 622, 35 A. 515, 34 L. R. A. 100; Dozier v. State, 154 Ala. 83, 46 So. 9, 129 Am. St. Rep. 51.

Discussing such license, the Iowa court in State v. Cater, supra, said: "The usual justification offered for the imposition of a license upon transient merchants is to insure proper contribution from such merchants for police protection and to protect local dealers against unfair competition by transient dealers who come and go so quickly as to escape their share of general taxation in the community, and it may be admitted that the reasons so advanced are sound and that reasonable license fees so exacted can well be upheld."

It was doubtless such motives that actuated the council in passing this last-noted ordinance. Plaintiff had no place of business in Opelika. It paid no license, nor did its agent. The agent puts the bread in the truck and sells it, as he testifies, to "any merchant who wants to buy it. I will sell it to any authorized licensed cafe or merchant. I ask if they have a license, and I sell it to them. I collect the money for the bread myself, sell it myself and deliver it myself. * * * When I ask a man if he is a licensed merchant I just take his word for it. When bread is delivered to me by The American Bakeries Company, I store it in my home until it is delivered to merchants. These deliveries are made to me every day from the American Bakeries Company in Atlanta. * * * I do not pay a license to the City." It was manifestly in answer to this situation and the application for a refund of the license under the ordinance of December, 1932, that the ordinance of March 13th was passed.

But counsel for plaintiff present a most ingenuous argument for a refund, even under the ordinance of March 13th, based upon the theory that plaintiff does not come within its terms. It is insisted that the license is prescribed for "each itinerant dealer or trader in bread," and that plaintiff is neither a dealer nor trader in bread, but a manufacturer. We are cited to authorities holding that a dealer or trader is not one who buys to keep, or makes to sell, but one who buys to sell again, and that such is the common acceptance of the...