Avanti Petroleum, Inc. v. St. Louis County

• Decision Date: 14 April 1998
• Docket Number: 72840,Nos. 72783,s. 72783
• Citation: 974 S.W.2d 506
• Parties: AVANTI PETROLEUM, INC., et al., Plaintiffs-Respondents, v. ST. LOUIS COUNTY, Missouri, and Buzz Westfall, County Executive, Defendants-Appellants. AVANTI PETROLEUM, INC., et al., Plaintiffs-Respondents, Cross-Appellants, v. ST. LOUIS COUNTY, Missouri, and Buzz Westfall, County Executive, Defendants-Appellants. Cross-Respondents.
• Court: Missouri Court of Appeals

Page 506

974 S.W.2d 506

AVANTI PETROLEUM, INC., et al., Plaintiffs-Respondents, v. ST. LOUIS COUNTY, Missouri, and Buzz Westfall, County

Executive, Defendants-Appellants.

AVANTI PETROLEUM, INC., et al., Plaintiffs-Respondents, Cross-Appellants, v. ST. LOUIS COUNTY, Missouri, and Buzz Westfall, County

Executive, Defendants-Appellants. Cross-Respondents.

Nos. 72783, 72840.

Missouri Court of Appeals,

Eastern District,

Division Three.

April 14, 1998.

Motion for Rehearing and/or Transfer to

Supreme Court Denied June 4, 1998.

Application to Transfer Denied

Sept. 22, 1998.

John A. Ross, County Counselor, Patricia Redington, Associate County Counselor, Clayton, for St. Louis County Missouri & Buzz Westfall.

Greensfelder, Hemker & Gale, P.C., Richard R. Hardcastle, III, Dawn Morville Johnson, St. Louis, for Avanti Petroleum.

KAROHL, Judge.

Plaintiffs, Avanti Petroleum Inc., and other retail tobacco vendors, (Vendors) and defendant St. Louis County (County) cross-appeal judgments on cross-motions for summary judgment. Vendors filed a petition for declaratory judgment as a constitutional and statutory challenge to St. Louis County Ordinance No. 17,981 (the Ordinance).

The issues on appeal are: (1) whether County can enact and enforce the Ordinance against Vendors in incorporated areas of St. Louis County as a health ordinance; (2) whether the license fee provisions in the Ordinance violate the Hancock Amendment; (3) whether license provisions in the Ordinance are severable; and, (4) whether Vendors are entitled to attorneys' fees and costs. We affirm in part and reverse and remand in part.

The Ordinance regulates sales of tobacco products. On April 4, 1996, County adopted the Ordinance as an amendment to Chapter 602 of Title VI entitled "Public Health." The Ordinance declares its provisions apply throughout St. Louis County except within cities having both a population of seventy-five thousand or more and organized health departments. Section 602.350 SLCRO 1974. The basic facts are undisputed. We review the declaratory summary judgment de novo. ITT Commercial Fin. Corp. v. Mid-America Marine Supply Corp., 854 S.W.2d 371, 376 (Mo. banc 1993).

Vendors are all tobacco retailers located in various incorporated municipalities of St. Louis County. The Ordinance prohibits retail sales of any tobacco products unless the vendor is licensed by the St. Louis County Department of Health (the Department). Section 602.361 SLCRO 1974. The Ordinance also prohibits vendors from selling tobacco to minors under eighteen years of age. Section 602.300 SLCRO 1974. To enforce the prohibition on sales to minors, the Department conducts a minimum of two random, unannounced compliance checks per year. Section 602.369 SLCRO 1974. The Ordinance establishes annual license fees to offset enforcement costs. It requires vendors pay $125 for retail establishments, $25 for each vending machine and $15 for retail establishments with gross receipts of $50,000 or less and the tobacco is inaccessible without employee assistance. Section 602.361 SLCRO 1974.

The trial court upheld the Ordinance as a valid health measure authorized by Article IV, Section 37 of the Constitution of Missouri and section 192.300 RSMo 1994. However, it invalidated the requirements of a license and a license fee. It found the Ordinance imposed a "tax, license, or fee" within the meaning of the Hancock Amendment, Article X, Section 22(a) of the Missouri Constitution, which requires an affirmative vote of the qualified voters of St. Louis County. No vote was had prior to the enactment of the Ordinance. Accordingly, the trial court severed and struck down provisions in the Ordinance it found offensive. Finally, the trial court held each party must bear their own attorneys' fees and costs. Both Vendors and County appeal.

The first issue is whether County can enforce the Ordinance against Vendors in incorporated areas of St. Louis County as a health ordinance. Vendors argue the Ordinance is not a valid health measure because there is: (1) no direct causal link between the Ordinance and the prevention of disease; (2) no reasonable relationship to public health; and, (3) no showing the Ordinance sought to achieve a public health purpose. Consequently, it contends County lacks authority to enforce the Ordinance against vendors conducting business within incorporated areas of St. Louis County.

Section 192.300 RSMo 1994, authorizes ordinances "[tending] to enhance the public health and prevent the entrance of infectious, contagious, communicable or dangerous diseases into such county." It also authorizes reasonable fees to pay costs incurred in carrying out such ordinances, conditioned upon a requirement that all fees collected be used to support the public health activities for which they were generated. Section 192.300 RSMo 1994. This authority does not apply to cities with populations of seventy-five thousand, or over, which have their own organized health departments. Section 192.310 RSMo 1994.

The issue is the nature of the Ordinance and whether it bears a reasonable relation to public health enhancement and disease prevention. We find Readey v. St. Louis County Water Co., 352 S.W.2d 622 (Mo. banc 1961), helpful. Our Supreme Court upheld an ordinance as tending to enhance public health which directed St. Louis County Water Company to introduce and maintain fluoride in the water it provided to customers. Id. at 623. The parties disputed whether the overall public health benefits outweighed the overall harm to public health. Id. at 627. The court found substantial evidence to support a conclusion either way. Id. It found the county council reasonably could have found and concluded possible resulting diseases from dental decay were serious and fluoridation would effectively decrease disease. Id. It expressly held the county council had authority and power to enact an ordinance county-wide which was intended to and which does tend to enhance the public health. Id.

Unlike the factual dispute in Readey, all evidence presented during debate prior to adoption of the Ordinance supports a finding the intent of the Ordinance was to reduce use of tobacco, as a known health hazard. A co-sponsor of the Ordinance stated the purpose of the Ordinance was reduction of tobacco related diseases and death by controlling use of tobacco by minors to prevent tobacco addiction. Many representatives from the medical community spoke about health risks of smoking. Evidence from Department of Health personnel in the form of surveys for the years 1991, 1993 and 1995 would support a finding teen smoking is on the rise. Tobacco industry groups and vendors, including one plaintiff-vendor, agreed minors should be prevented from smoking. This suggests the parties do not contest the fact that smoking of tobacco is a public health issue.

County has the power to protect its youth from access to a known health hazard such as tobacco use. Section 192.300 does not restrict the means or methods of public health laws. Professional Houndsmen, 836 S.W.2d at 21. Any reasonable method is lawful. Id. Preventing sales of tobacco to minors to reduce or prevent their use of such products bears a reasonable relation to reducing dangerous disease. Accordingly, we reject Vendors' contention and hold the Ordinance is authorized and enforceable against vendors in both unincorporated and incorporated St. Louis County.

The second issue is whether the Ordinance license fee violates the Hancock Amendment. Article X, Section 22(a) of the Missouri Constitution, the Hancock Amendment, prohibits political subdivisions from "levying any tax, license or fee ... without the approval of a required majority of the qualified voters ... voting thereon."

In its first argument, County argues the trial court erred as a matter of law when it denied its motion for summary judgment. The trial court's denial of County's motion for summary judgment is not an appealable order even where the order grants an appealable summary judgment to the other party. Parker v. Wallace, 431 S.W.2d 136, 137 (Mo.1968); McCormack v. Maplewood-Richmond Heights, 935 S.W.2d 703, 706 (Mo.App. E.D.1996).

Next, County argues the trial court erred as a matter of law when it granted Vendors' motion for summary judgment invalidating the license fees as a violation of the Hancock Amendment. It presents its position in three alternate arguments.

First, it argues the trial court erred when it applied the factors found in Keller v. Marion County Ambulance Dist., 820 S.W.2d 301 (Mo. banc 1991), to invalidate the license fee. It contends the Keller factors are not applicable and "ill-fitted" in a regulatory license fee situation. Keller involved true user fees. It contends, license fees possess distinct attributes not shared by true user fees.

Second, it argues, notwithstanding the ill-fit, the trial court erred when it incorrectly applied the Keller factors. It contends a correct application would support the conclusion the license fees are not subject to the Hancock Amendment.

Finally, it argues the trial court erred when it failed to consider principles found in pre-Hancock license fee cases and relied exclusively on the Keller factors. It argues Keller does not foreclose use of non-Keller factors. It contends in situations where there is a license fee enacted to regulate health, safety and welfare, the court should consider pre-Hancock Amendment factors. It asks that we rely upon Meyer v. St. Louis County, 602 S.W.2d 728, 733-34 (Mo.App.1980), for the definition of a tax. It contends license fees enacted to regulate the general safety, health and welfare do not fall under the Meyer definition of a tax.

Keller involved a challenge to an ambulance district's increase in fees charged for use of ambulance services. Keller, 820 S.W.2d at 302. The court applied the Keller factors and found the fee increase was a true user fee which did not require voter consent. Id. at...