Beacon Liquors v. Martin

• Court: Kentucky Court of Appeals
• Writing for the Court: SIMS, Commissioner.
• Citation: Beacon Liquors v. Martin, 279 Ky. 468, 131 S.W.2d 446 (Ky. Ct. App. 1939)
• Decision Date: 24 March 1939
• Parties: BEACON LIQUORS v. MARTIN et al.

131 S.W.2d 446

279 Ky. 468

BEACON LIQUORS v. MARTIN et al.

Court of Appeals of Kentucky

March 24, 1939

As Extended on Denial of Rehearing May 19, 1939.

Appeal from Circuit Court, Franklin County; William B. Ardery Judge.

Suit by Beacon Liquors against James W. Martin and others to determine the constitutionality of a certain statute and to enjoin the Alcoholic Control Board and Alcoholic Beverage Administrators of the City of Louisville and of Jefferson County from refusing to issue retail package license to plaintiff. From a judgment for the defendant, plaintiff appeals.

Reversed in part and in part affirmed.

Grover G. Sales, John Marshall, Jr., and Milliken & Handmaker, all of Louisville, for appellant.

Hubert Meredith, Atty. Gen., Harry D. France and William Hayes Asst. Attys. Gen., and Hal O. Williams, Lawrence S. Poston and H. Appleton Federa, all of Louisville, for appellees.

SIMS Commissioner.

This case presents for our determination the constitutionality of Section 75 of the Alcoholic Beverage Control Law of 1938 being Section 2554b-177, Kentucky Statutes, Baldwin's Edition, 1938 Supplement, which section reads as follows:

" No retailing near school, hospital, church or other place of worship; exception.--No license for the sale of alcoholic beverages at retail shall be granted for any premises which shall be located on the same street or avenue as, and within two hundred feet of a building occupied exclusively as a school, hospital, church or other place of worship without the written permission of the governing authority of such church, school or hospital, except that a hotel, drug store or private club which has been bona fide in business as a license at that location for not less than one year next preceding the passage of this Act or the establishment of said church, school or hospital, may be granted a license by the Administrator, in the exercise of his sound discretion, even though within less than two hundred feet of a building occupied exclusively as a school, hospital, church, or other place of worship. The measurement called for in this section shall be taken on the street or avenue on which the licensed premises are located in a straight line from the nearest property line of the real estate on which is located the building used for such school, hospital, church or other place of worship to the nearest property line, of the real estate on which is located the building for which a license is sought."

Appellant, Beacon Liquors, a Kentucky corporation, engaged in selling liquor at retail by the package to be consumed off the premises, is located on Fourth Avenue in Louisville, Kentucky, within 200 feet of the Fourth Avenue Baptist Church. The church refused to give written permission whereby the Alcoholic Beverage Administrator of the City of Louisville might grant a license to appellant, hence the Administrator refused to issue it a license to carry on its business. Suit was then instituted by appellant in the Franklin Circuit Court against the Alcoholic Control Board and the Alcoholic Beverage Administrators of the City of Louisville and of Jefferson County asking that the foregoing section be declared unconstitutional, and that the Alcoholic Control Board and the Administrators be enjoined from refusing to issue a retail package license to it. Upon a hearing of the case on motion for an injunction and upon its merits the chancellor refused the injunction, and adjudged that part of Section 75 which makes an exception in favor of hotels, drug stores and private clubs unconstitutional, and adjudged all other parts to be constitutional. The case is before us on an appeal from the judgment rendered by the chancellor.

To determine the constitutionality of the above quoted section we must decide two questions. First, does it grant exclusive privileges without any rational basis for classification? Second, does it delegate legislative power to churches, schools, and hospitals, contrary to the Kentucky Constitution?

Appellant admits the legislature has the right under its police power to regulate the sale of liquor, but contends the classification is arbitrary and grants special privileges to hotels, drug stores and private clubs in violation of Section 3 of our constitution which forbids exclusive privileges being granted to any man, or set of men, except in consideration of public services. The legislature may not put arbitrary and unnecessary restrictions upon lawful occupations under the mask of police power, but the restriction or regulation must be reasonably necessary to effectuate the results desired. Lawton v. Steele, 152 U.S. 133, 14 S.Ct. 499, 38 L.Ed. 385; Mugler v. Kansas, 123 U.S. 623, 8 S.Ct. 273, 31 L.Ed. 205.

Due to the inherent evils connected with the liquor business, for years it has been subjected to the strictest regulation in this state, as well as all the other states of the Union, as to its manufacture, possession, transportation, sale and use. Regulations, which would be held to be arbitrary and unreasonable when applied to any other business, have been upheld by the courts in an attempt to exercise control over and restriction upon the liquor traffic. We have come to recognize control over the manufacture and sale of liquor is not a legal and economic problem alone, but it is a momentous social problem which the state and nation have attempted to solve, and its solution seems as distant today as it was at the birth of the present century. Not being successful in controlling the liquor business by its police power, the national congress enacted the eighteenth amendment to the Constitution, U.S.C.A., which prohibited the manufacture, sale and transportation of intoxicating liquors for beverage purposes. After some fourteen years of national prohibition the twenty-first amendment to the Federal Constitution, U.S.C.A., was enacted whereby the eighteenth amendment was repealed, and the control of the liquor business was returned to the several states. Since the repeal of the eighteenth amendment, practically all states permitting liquor to be sold legally within their boundaries have again turned to their police power in an endeavor to regulate rigidly the manufacture, possession, transportation and sale of liquor.

In its argument that the exception in favor of hotels, drug stores, and private clubs is arbitrary and makes a classification without any rational basis, appellant cites Board of Council of Harrodsburg v. Renfro, 58 S.W. 795, 22 Ky. Law Rep. 806. In that case the City of Harrodsburg fixed the license at $900 per year for selling liquor on the Main Street of the town, while such a license was $600 per year for selling liquor on any other street in Harrodsburg. It is evident this ordinance of the City Council of Harrodsburg violated several sections of our constitution and it was so held. The distinction between a license case and the case at bar is so apparent we do not think it necessary to enter into a discussion of the Renfro case. It is sufficient to say that under our constitution, § 171, all taxation must be uniform within the entire territorial limits of the authority levying the tax. Appellant also cites Kentucky Board of Pharmacy v. Cassidy, 115 Ky. 690, 74 S.W. 730, 25 Ky.Law Rep. 102, holding drug stores cannot be given the exclusive right to sell patent medicine--the reason the court gave was that it took no skill to sell patent medicine and an ordinary merchant can do so as safely as a registered pharmacist. We can see no application of the Cassidy case to the case before us, as there is no reasonable basis for the arbitrary limitation of confining sales of proprietary medicines to drug stores. It would be as unreasonable to limit the sale of patent medicines to drug stores employing a registered pharmacist as it would be to limit the sale of soap to such drug stores.

In Katzman v. Commonwealth, 140 Ky. 124, 130 S.W. 990, 30 L.R.A.,N.S., 519, 140 Am.St.Rep. 359, an Act of the legislature prescribing regulations on retail druggists in the sale of dangerous drugs was held constitutional even though such restrictions were not applicable to wholesale druggists. And in Commonwealth v. Fowler, 96 Ky. 166, 28 S.W. 786, 16 Ky.Law Rep. 360, 33 L.R.A. 839, a special license tax placed on the sale of whiskey by a drug store for medicinal purposes was held not to be a revenue measure, but one to prevent abuses likely to follow the liquor traffic. The regulations in the Katzman and Fowler cases were held reasonable and proper under the police power and it was adjudged they were not in conflict with any provision of the state constitution.

It is not difficult to distinguish Commonwealth v. Smith, 163 Ky. 227, 173 S.W. 340, L.R.A. 1915D, 172, from the case at bar. Smith was prosecuted...