Arnke v. City of Berkeley

• Citation: 185 Cal.App.2d 842,8 Cal.Rptr. 645
• Court: California Court of Appeals Court of Appeals
• Decision Date: 01 November 1960
• Parties: Frederick ARNKE, Plaintiff and Appellant, v. CITY OF BERKELEY, Defendants and Respondents. Civ. 19283.

Page 645

8 Cal.Rptr. 645

185 Cal.App.2d 842

Frederick ARNKE, Plaintiff and Appellant, v. CITY OF BERKELEY, Defendants and Respondents.

Civ. 19283.

District Court of Appeal, First District, Division 2, California.

Nov. 1, 1960.

Rehearing Denied Dec. 1, 1960.

Hearing Denied Dec. 28, 1960.

Dinkelspiel & Dinkelspiel, Alan A. Dougherty, Redwood City, for appellant.

Robert T. Adnderson, City Atty., Robert P. Berkman, Asst. City Atty., Berkeley, for respondents.

McGOLDRICK, Justice pro tem.

This is a proceeding for declaratory relief in which appellant prays for a judgment declaring that city of Berkeley ordinance No. 2805-N.S., as amended, is void, unconstitutional and ineffective and that defendants be permanently restrained and enjoined from the enforcement of said ordinance against him.

The trial court adjudged said ordinance to be valid and constitutional in all respects as applied to appellant and subjected him to the payment of the business license tax provided therein. The appeal is taken from this decree.

The facts are not in dispute. Appellant is an ornamental metals contractor, duly licensed as such under the laws of the State of California. He maintains his fixed place of business in the City and County of San Francisco. He is engaged in the prefabrication of materials outside the city of Berkeley, and the erection of such inside said city. The parties have stipulated that appellant does 1/6 of his total business within the city of Berkeley, that said amount of business is substantial, and that it requires two to four men working forty days per year. In addition, he makes delivery of steel and prefabricated metal in the city of Berkeley from time to time.

Ordinance No. 2805-N.S. of the city of Berkeley entitled 'Licensing For Purposes Of Revenue Certain Professions, Businesses, Trades And Occupations In The City Of Berkeley' provides in pertinent part as follows:

'Section 1.1. This Ordinance is enacted solely to raise revenue for Municipal purposes, and is not intended for the purpose of regulation.'

'Section 1.2-6. The average number of employees for any business not having a fixed place of business, in the City of Berkeley shall mean the number of persons employed daily in the applicant's business for the period during which such applicant conducts such business in the City of Berkeley, and shall be determined by ascertaining the total number of hours of service performed by all employees during the three (3) days, or less, on which the greatest number of persons are employed, and dividing the total number of hours of service thus obtained by the number of hours of service constituting a day's work, according to the custom or laws governing such employments, and by again dividing the sum thus obtained by the number of business days upon which the total hours of service is based. In computing the average number of employees, fractions of numbers shall be excluded.'

'Section 2.1. There are hereby imposed upon all business in the City of Berkeley, license taxes in the amounts hereinafter in this Ordinance prescribed. It shall be unlawful for any person, either for himself or for any other person, to commence, transact or carry on any business in the City of Berkeley not excluded by this Ordinance, without first having procured a license from said City so to do, or without complying with any and all regulations contained in this Ordinance. The carrying on of any business without first having procured a license from said City so to do, or without complying with any and all regulations of this Ordinance, shall constitute a separate violation of this Ordinance for each and every day that such business is so carried on.'

'Section 5.2. Every person engaged at other than a fixed place of business in the City of Berkeley in any trade, calling, occupation, vocation profession or other means of livelihood, as an independent contractor and not as an employee of another, and not specifically licensed by other provisions of this Ordinance, shall pay a semi-annual license tax based upon the average number of employees as defined in Section 1.2-6 of this Ordinance, and upon the annual rates provided for in Section 5.1 hereof. (As amended by Ordinance No. 3654-N.S, in effect October 2, 1958.)'

'Section 7.6. For the purpose of this Ordinance, any person shall be deemed to be in business and subject to the provisions of this Ordinance who does one act of selling, offering for sale, or taking an order for any goods, wares, merchandise, article, thing or service, or offering or soliciting for compensation the rental of any automobile for hire, of furnishing or offering to furnish for compensation bail to any person in any criminal proceeding, or of making a delivery.'

'Section 7.10. It shall be unlawful for any person to violate any provision or to fail to comply with any of the requirements of this Ordiance. Any person violating any provision of this Ordinance, or knowingly and intentionally misrepresenting to any officer or employee of this City in procuring a license, shall be deemed guilty of a misdemeanor and, upon conviction thereof, shall be punished by a fine not exceeding Five Hundred Dollars ($500) or by imprisonment not exceeding six (6) months, or by both such fine and imprisonment. Each such person shall be deemed guilty of a separate offense for each day during any portion of which any violation of any of the provisions of this Ordinance is committed, continued or permitted by such person and shall be punishable therefor as provided for in this Ordinance.'

'Section 8.1. If any section, subsection, sentence, clause, phrase or portion of this Ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The Council of the City of Berkeley hereby declares that it would have adopted this Ordinance and each section, sub-section, sentence, clause, phrase or portion thereof, irrespective of the fact that any one or more sections, sub-sections, sentences, clauses, phrases or portions be declared invalid or unconstitutional.'

Appellant contends that said ordinance, as amended, is invalid for the following reasons: (1) that it requires plaintiff first to pay a license fee before doing business with the city of Berkeley, which conflicts with and nullifies the permission given the contractor by general law to conduct his business at any place in the state; (2) that it attempts to impose upon appellant a tax upon his business which business is not located within the territorial limits of the city of Berkeley; (3) that it attempts to impose a motor vehicle license tax on the vehicles of the appellant which field is fully pre-empted by the general laws of the State of California; and (4) that it attempts to enforce its provisions by criminal process.

Appellant relies upon the cases of Agnew v. City of Los Angeles, 51 Cal.2d 1, 330 P.2d 385, Agnew v. City of Culver City, 51 Cal.2d 474, 334 P.2d 571, and Agnew v. City of Culver City, 147 Cal.App.2d 144, 304 P.2d 788, as standing for the proposition that city business taxes may not be enforced against persons licensed under state law by requiring them to secure business licenses or suffer criminal penalties. In the Agnew cases, it is revealed that the license fees were not imposed solely for revenue purposes but as an inseparable part of a regulatory scheme excluded by state law. In the instant case, the city seeks to enforce its licensing ordinance against appellant for revenue only and the Agnew cases, supra, expressly recognize that such taxation is not excluded because the state has occupied the field of regulation. Respondents and appellant rely upon the case of Security Truck Line v. City of Monterey, 117 Cal.App.2d 441, 256 P.2d 366, 374, 257 P.2d 755. Here, plaintiff was a highway carrier licensed by the Public Utilities Commission. During the winter fish packing season, it hauled fish by its own trucks and by sub-contracts with sub-haulers into the city of Monterey from outside the county. The city imposed upon plaintiff a business license tax based upon the weight of each of its trucks and upon each truck of the sub-haulers employed by plaintiff in such hauling. The ordinance required that each of the licensee's vehices display the license furnished for that purpose, and provided criminal sanctions for the violation of any of its provisions. The licensee's only activities in Monterey were the deliveries of such fish, it having no place of business nor agents and no terminus therein. An action was brought against the city to have the ordinance declared unconstitutional and to have its enforcement enjoined. The court held that '* * * although the power to tax is clear, the method provided for the measurement of the tax, is, * * * invalid for the...