Asher v. Ingels

• Decision Date: 08 February 1936
• Docket Number: No. 814.,814.
• Citation: 13 F. Supp. 654
• Parties: ASHER et al. v. INGELS, Director of Department of Motor Vehicles of California, et al.
• Court: U.S. District Court — Southern District of California

13 F. Supp. 654

ASHER et al. v. INGELS, Director of Department of Motor Vehicles of California, et al.

No. 814.

District Court, S. D. California, Central Division.

February 8, 1936.

Russell D. Garner, of Los Angeles, Cal., for plaintiffs.

U. S. Webb, Atty. Gen., and Frank Richards, Deputy Atty. Gen., for defendants.

Before WILBUR, Circuit Judge, and YANKWICH and STEPHENS, District Judges.

YANKWICH, District Judge.

The 1935 session of the California Legislature enacted a statute known as chapter 527 of the Statutes of 1935 (page 1605), which was also codified by the same Legislature as sections 146, 146.5, 180.5, and 371.5 of the California Vehicle Code (St.1935, pp. 109, 116, 147). These sections are as follows:

"146. Application for Registration of Vehicle Previously Registered Outside This State. (a) Upon application for registration of a vehicle previously registered outside this State, the application shall be verified and shall also state such fact and the time and place of the last registration of such vehicle outside this State and the name and address of the governmental officer, agency, or authority making such registration, together with such further information relative to its previous registration as may reasonably be required by the department, including the time and place of original registration, if known, and if different from such last foreign registration; and, except as provided in subdivision (b) of this section, the applicant shall surrender to the department all license plates, seals, certificates or other evidence of foreign registration as may be in his possession or under his control.

"(b) No nonresident entering this State and subject to registration under the provisions of subdivision (b) of section 216, shall be required to surrender the evidences of foreign registration mentioned in subdivision (a) of this section."

"146.5. Notice of Application for Registration of Vehicle Previously Registered Outside This State. The department shall forthwith mail a notice of the filing of any application for registration of a vehicle previously registered outside this State to the governmental officer, agency, or authority which made the last registration of such vehicle outside this State. Such notice must contain like data as required on the application filed with the department. No vehicle previously registered outside this State shall be registered in this State nor shall the department issue any certificate of ownership, registration card, nor license plate or plates hereunder therefor prior to the expiration of ninety days from the day on which the application for registration thereof hereunder is filed with said department, but the foregoing limitations in this sentence shall not apply to commercial vehicles operating in interstate transportation nor affect the right of the department to grant temporary permits under section 147."

"180.5. Restriction on Transfer of Vehicle Previously Registered Outside This State. Neither the title to nor any interest in any vehicle previously registered outside this State shall be transferred within this State by any person, whether dealer, manufacturer, or private individual, unless such vehicle is then registered in this State under the provisions of this code."

"371.5. Additional Registration Fee for Vehicle Previously Registered Outside This State. In addition to the registration fee specified in section 370 and any weight fee, there shall be paid a registration fee of three dollars for the original registration within this State of every vehicle previously registered outside this State."

The plaintiffs are citizens of California, residing in Los Angeles, and are copartners engaged in the business of buying, selling, and trading in used automobiles with their principal place of business in Los Angeles. They have complied with the law relating to such business, and have posted, in conformity with the ordinances of the city of Los Angeles, a bond in the sum of $2,500 in favor of persons purchasing automobiles from them. The automobiles are purchased in states other than California through local dealers at prices substantially lower than they could be purchased in California. They are driven from such states to the place of business of the plaintiffs for the purpose of immediate resale to used-car dealers in California. In order to drive the automobiles over the highways outside of California, the plaintiffs must procure registration certificates and license plates from the proper authorities in the states where the automobiles are purchased. In order to sell the automobiles and to pass valid title, they must procure, immediately upon receipt of the automobiles at plaintiffs' place of business, certificates of ownership, registration cards, and license plates for the automobiles. The business of the plaintiffs is well established, and approximately a thousand out of state cars are imported into the county of Los Angeles monthly for the purpose of resale. The plaintiffs themselves resell about one-fourth of this number. The business built up by the plaintiffs is of the value of $25,000. It cannot be carried on without the purchase of automobiles out of the state and their resale to California residents. On January 2, 1936, plaintiffs purchased in the city of Phœnix, Ariz., a Ford automobile, and on the same day caused it to be registered and obtained a 1936 Arizona license therefor. They drove the automobile to Los Angeles, and on January 6th applied to the defendant, Ray Ingels, director of the department of motor vehicles, Howard E. Deems, registrar of motor vehicles of the state of California, and Lon W. Butler, manager of the Los Angeles city office of the department of motor vehicles, for a California certificate of ownership, registration card, and license plates, and paid to them the sum of $3 registration fee and $2.71 personal property tax as required by the provisions of chapter 362, Statutes of 1935 (page 1312), and tendered all other papers and documents required by law. The defendants, basing their refusal upon the requirements of sections 146.5 and 371.5 of the Vehicle Code of California (St.1935, pp. 109, 147), declined to give to the plaintiffs a California certificate of ownership or a registration card or license plates.

The plaintiffs thereafter filed a verified application in the office of the defendants, supplying the necessary information under section 146 of the Vehicle Code (St. 1935, p. 109), tendering the sum of $6 registration fee and $2.71 personal property tax. That met with a similar refusal upon the ground that under the provisions of section 146.5 of the Vehicle Code (St. 1935, p. 109) no certificate of ownership, registration card, or license plates could be issued upon an automobile previously registered outside of the state until the expiration of 90 days from the day of the application for registration. On January 6th one J. K. Woods offered to purchase the automobile from the plaintiffs and to pay them $150 for it. Plaintiffs are desirous of selling the same, but are unable to do so because they have no certificate of ownership, registration card, or license plates. The offer of sale will lapse on January 10, 1936.

The bill of complaint, after setting forth the facts just given, alleges in substance: Should the plaintiffs sell or transfer title to the automobile before registering it, they are threatened with prosecution under sections 180.5 and 230 of the Vehicle Code (St.1935, pp. 116, 126). The threat of the defendants to enforce the provisions of the statutes referred to will destroy plaintiffs' business, for the reason that it is impossible to sell, and no retail used-car dealers will purchase, any motor vehicle unless the vendor thereof has a California certificate of ownership, registration card, and license plates. The enforcement of the law will destroy the used-car business in California, because secondhand automobiles depreciate in value very rapidly, the interest charges on money invested for 90 days is prohibitive, storage for a similar period is expensive, the market for used automobiles is too uncertain to justify a 90-day wait, and the total average depreciation and maintenance cost of the type of automobile dealt in by plaintiffs over a 90-day period will amount to a hundred dollars.

By reason of these facts, it is contended that chapter 527 of the Statutes of California is unconstitutional and in violation of article 1, section 8, clause 3 (the commerce clause), of article 4, section 2, of the Constitution of the United States (the immunities clause), and of section 1 of the Fourteenth Amendment to the same Constitution (the equal protection and due process clauses). The complaint upon the basis of these facts asks a judgment declaring the act invalid and for permanent injunctive relief against its enforcement. Pending the final determination of the suit, an interlocutory injunction is sought. The defendants have moved to dismiss the bill and to strike certain allegations from it. They have also asked that the application for an interlocutory injunction be denied.

The motion to strike certain portions of the bill may be disposed of by denying it upon the ground that the portions sought to be stricken from the bill, while descriptive of the business and bordering on conclusions, are merely in the nature of narrative, and, even if superfluous, do not vitiate the pleading. The motion to dismiss is grounded chiefly upon the proposition that the bill does not state a cause of action, for the reason that no federal question is presented and that the enactment attacked is a valid exercise of the police power of the state.

Before considering the attack upon the act, it is well to refer to other sections of the California Vehicle Code relating to the registration of automobiles in general. When receiving an application for registration and when satisfied of its genuineness and...