Arkansas State Bd. of Pharmacy v. Hall
| Decision Date | 18 December 1967 |
| Docket Number | No. 5--4366,5--4366 |
| Citation | 421 S.W.2d 888,243 Ark. 741 |
| Parties | ARKANSAS STATE BOARD OF PHARMACY, Appellant, v. Toy C. HALL et al., Appellees. |
| Court | Arkansas Supreme Court |
Warren & Bullion, Little Rock, for appellant.
Elrod & Bonner, Siloam Springs, for appellees.
This case began as an application by the appellees, two qualified registered pharmacists, for a permit to establish and conduct a new pharmacy at 304 South Maxwell Street in the City of Siloam Springs. The State Board of Pharmacy denied the application on the ground that it did not meet the requirements of the Board's Regulation 36, adopted in 1966. On appeal the circuit court reversed the Board's decision, holding that Paragraph 2 of the regulation--the provision pertinent to this litigation--was invalid as being beyond the authority granted to the Board by the legislature. The correctness of that ruling is the controlling question here.
We quote Paragraph 2 of the regulation:
2. In determining whether to issue a registered pharmacy permit for a new pharmacy or for a new location of an existing pharmacy, the Board will determine whether public need and convenience will be served by the granting of the permit at the particular location sought. The Board will not grant a permit where the granting of the permit will not serve the public need or convenience.
We need not narrate at length the facts developed at the hearing before the Board, at which the appellees were not represented by counsel. Their application for a permit was opposed by rival pharmacists in Siloam Springs, whose testimony tended to show that the operation of a pharmacy at the particular location selected by the appellees would eventually create a monopoly.
The threat of a monopoly stems from these facts: Five of the six physicians practicing in Siloam Springs are building a medical center which they will occupy together. They plan to construct, next to the medical center, a fully-equipped pharmacy. The appellees bid for the privilege of running the pharmacy. They will pay a monthly rental of $550 for the small pharmacy building (as compared to the rental of $75 a month formerly paid by the appellee Toy for a drugstore building in the same city).
One of the doctors testified that his group will have no interest in the pharmacy, will make no effort to send patients to the pharmacy, and will have no agreement with the pharmacists for rebates or a share in the profits. Despite the doctors' protestations counsel for the Board argue, and the Board doubtless believed, that the doctors' self-interest, stemming from their ownership of the building and their power to fix the rent, would ultimately result in their channeling so much business to the clinic-connected pharmacy as to give it a decided competitive advantage over the other three pharmacies in the city.
Turning to the pivotal question of law--the validity of Paragraph 2 of Regulation 36--we emphasize at the outset that our sole inquiry is whether the legislature has conferred upon the Board of Pharmacy the power to determine, as a condition to the issuance of a permit, whether the public need and convenience will be served by the operation of a pharmacy at the particular location selected by the applicant. We are not concerned either with the wisdom of the statutes governing the Board or with any questions of medical ethics that might be raised with respect to the proposed medical center and pharmacy.
Our study of the pertinent statutes firmly convinces us that the legislature has not undertaken to delegate to the Board of Pharmacy the power to exercise the authority embodied in the regulation in question. The various acts pertaining to the Board are compiled as Title 72, Chapter 10, of the Arkansas Statutes Annotated (Repl. 1957).
The Board was created by Act 50 of 1891. That statute authorized the Board to register qualified pharmacists, with or without examination as directed by the act. It was made unlawful for any person not a registered pharmacist to conduct a drugstore, pharmacy, or apothecary shop for the compounding or dispensing of medicines.
Act 72 of 1929 embodied a more comprehensive enumeration of the...
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...appropriate standards for the guidance of the administrative body by which the power is to be exercised. Arkansas St. Bd. of Pharmacy v. Hall, 243 Ark. 741, 421 S.W.2d 888 (1967). Further, although discretionary power may be delegated by the legislature to the licensing authority, it is ess......
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