Campbell Baking Co. v. City of Harrisonville, Mo.

• Decision Date: 09 July 1931
• Docket Number: No. 8327.,8327.
• Citation: 50 F.2d 670
• Parties: CAMPBELL BAKING CO. v. CITY OF HARRISONVILLE, MO., et al.
• Court: U.S. Court of Appeals — Eighth Circuit

50 F.2d 670 (1931)

CAMPBELL BAKING CO. v. CITY OF HARRISONVILLE, MO., et al.

No. 8327.

Circuit Court of Appeals, Eighth Circuit.

May 9, 1931.

Rehearing Denied July 9, 1931.

COPYRIGHT MATERIAL OMITTED

Herbert D. Mason and Stewart Lynch, both of Tulsa, Okl. (John H. Lathrop, of Kansas City, Mo., and Harold R. Williams and Mason & Williams, all of Tulsa, Okl., and Lathrop, Crane, Reynolds, Sawyer & Mersereau, of Kansas City, Mo., on the brief), for appellant.

Raymond G. Barnett, of Kansas City, Mo. (Allen B. Glenn, of Harrisonville, Mo., and Cleary & Barnett, of Kansas City, Mo., on the brief), for appellees.

Before STONE, VAN VALKENBURGH, and BOOTH, Circuit Judges.

STONE, Circuit Judge.

This is an action to enjoin enforcement of an ordinance of the city of Harrisonville, Mo., levying a license tax upon appellant. From an order denying a temporary injunction, this appeal is brought.

The here material provision of the ordinance is as follows:

"Section 2-A. License: Each person, firm or corporation engaged in selling or delivering any goods or merchandise of any kind, at wholesale or retail, to any firm, person or corporation in the City of Harrisonville, Missouri, shall pay at the rate of $2.00 per day or $30.00 per month or $125.00 for six months or $200.00 per year; but this Section shall not apply to any person, firm or corporation selling at their regular established place of business. Any person, firm or corporation making any such sale or delivery, without first procuring a license and paying the said sum of $2.00 per day, or $30.00 per month or $125.00 for six months or $200.00 per year, shall be guilty of a misdemeanor, and, upon conviction, shall be fined in the sum of not less than $10.00 nor more than $25.00."

This ordinance expressly applies to those who sell or deliver goods or merchandise in Harrisonville with no regular established place of sale therein. The undisputed business methods of appellant show it within the ordinance. Appellant has a large plant at Kansas City, Mo., where it makes bread and cakes. Among its customers are retail merchants in towns and cities which are sufficiently near to Kansas City to permit daily delivery by trucks of appellant over regularly established routes. One of these delivery routes covers seven communities, including Harrisonville. There are seven regular merchant customers in Harrisonville. These customers have standing orders (subject to approval of the plant manager) with appellant for daily deliveries to them at their places of business in Harrisonville. Each day appellant's deliveryman brings to each merchant the desired bread and cakes and picks up any unsold stock for return and credit. This is all of the business done by appellant in Harrisonville. That appellant has no regular established place of business in Harrisonville and that it makes deliveries of merchandise therein is clear. Also it is clear that the sales of the bread and cakes to the merchants at Harrisonville take place there. This is true because the necessary element of a sale is the passing of title (Norfolk & W. Ry. Co. v. Sims, 191 U. S. 441, 447, 24 S. Ct. 151, 48 L. Ed. 254; De Bary v. Souer, 101 F. 425, 428 C. C. A. 5; State v. Wingfield, 115 Mo. 428, 22 S. W. 363, 37 Am. St. Rep. 406) and this, under the above method of doing business, does not occur until the bread and cakes are delivered to the merchants there. At that time and place, title (as well as possession) passes, and not until that occurs is there any sale. The St. Joze Indiano, 1 Wheat. 208, 4 L. Ed. 73; The Carlos F. Roses, 177 U. S. 655, 20 S. Ct. 803, 44 L. Ed. 929; Buckingham v. Dake, 112 F. 258, 269 (C. C. A. 8); De Bary v. Souer, 101 F. 425 (C. C. A. 5); McElwee v. Metropolitan Lumber Co., 69 F. 302, 305 (C. C. A. 6); Scharff v. Meyer, 133 Mo. 428, 34 S. W. 858, 54 Am. St. Rep. 672. Cases where the seller made deliveries and the sale was held to be at the place of delivery are following: State v. Houts, 36 Mo. App. 265; Doster v. State, 93 Ga. 43, 18 S. E. 997; Merrill v. State, 175 Ind. 139, 93 N. E. 857, 44 L. R. A. (N. S.) 439; Cheadle v. Roberts, 150 Iowa, 639, 130 N. W. 368; Carter v. Bartel, 110 Iowa, 211, 81 N. W. 462; Cameron v. Fellows, 109 Iowa, 534, 80 N. W. 567; Bartel v. Hobson, 107 Iowa, 644, 78 N. W. 689; Com. v. Bottom, 140 Ky. 212, 130 S. W. 1091; Lochnar v. State, 111 Md. 660, 76 A. 586, 19 Ann. Cas. 579; Com. v. Hugo, 164 Mass. 157, 41 N. E. 123; Com. v. Eggleston, 128 Mass. 408; Com. v. Greenfield, 121 Mass. 40; State v. Kind, 80 N. J. Law, 176, 75 A. 438, affirmed 80 N. J. Law, 466, 78 A. 1135; Town of Montclair v. Scola, 76 N. J. Law, 137, 69 A. 451; Shuster v. State, 62 N. J. Law, 521, 41 A. 701, affirmed 63 N. J. Law, 355, 46 A. 1101; People v. Capen, 26 Hun (N. Y.) 377; State v. Wernwag, 116 N. C. 1061, 21 S. E. 683, 28 L. R. A. 297, 47 Am. St. Rep. 873.

The main contentions of appellant are that the ordinance is invalid as violating the Fourteenth Amendment, and also as being without the taxing power of the city under the state statutes and Constitution.

The Fourteenth Amendment. The contention as to violation of the Fourteenth Amendment is that the ordinance has made a taxation classification based upon nonresidence, and that such character of classification is arbitrary, unreasonable, and unjust, and denies that equal protection of the laws required by the Amendment. The ordinance is, in form, a revenue measure. We see no reason to disagree with the view of the trial court that the evidence failed to show any ulterior motive in its passage — such as police regulation under the disguise of a tax — and therefore we shall consider and determine the questions here raised from the basis that this is genuinely a revenue enactment.

The very nature and purposes of taxation usually prevent any exact equality. This situation is accentuated when the character of tax is that of a license or occupation imposition. Abstractly, there is no more reason to tax a butcher than there is to tax a baker, but the power to make selections among avocations for raising revenue exists, and the exercise of that power is governed by practical considerations which may appeal to the taxing body and are not subject to revision by courts. Southwestern Oil Co. v. Texas, 217 U. S. 114, 121, 30 S. Ct. 496, 54 L. Ed. 688. This selection is particularly free in license or occupation revenue legislation. Oliver Iron Mining Co. v. Lord, 262 U. S. 172, 179, 43 S. Ct. 526, 67 L. Ed. 929. In so far as the Fourteenth Amendment is concerned, the sole restriction upon such selection is that it shall not involve a classification which is "palpably arbitrary," which is construed to mean that the classification "must rest upon some ground of difference having a fair and substantial relation to the object of the legislation, so that all persons similarly circumstances shall be treated alike." Ohio Oil Co. v. Conway, 281 U. S. 146, 160, 50 S. Ct. 310, 314, 74 L. Ed. 775. A very great many cases involving classifications for occupational or license taxes by states or political subdivisions thereof have been before the Supreme Court of the United States, and each has been necessarily rested upon the particular situation involved therein. However, we think the decision in Singer Sewing Mach. Co. v. Brickell, 233 U. S. 304, 34 S. Ct. 493, 58 L. Ed. 974, involved a situation so identical or at least analogous to that here presented that it must govern our determination. The statute in that case is identical in essentials with the ordinance here, and is more restrictive, in one sense, in that it expressly applied to but one article — sewing machines. In that case, the Supreme Court sustained the tax classification between "the business of selling sewing machines from a regularly established store and the business of selling them from a delivery wagon" (page 315 of 233 U. S., 34 S. Ct. 493, 497), because there was a difference "in the mode of doing business" (page 315 of 233 U. S., 34 S. Ct. 493, 497). The same difference in "mode of doing business" is here present. The Fourteenth Amendment is not violated by this ordinance.

Power Under State Law. The Missouri statutes (Rev. St. Mo. 1929, § 7287, formerly Rev. St. Mo. 1919, § 8702) provide that "no municipal corporation in this state shall have the power to impose a license tax upon any business avocation, pursuit or calling, unless such business avocation, pursuit or calling is specially named as taxable in the charter of such municipal corporation, or unless such power be conferred by statute." Harrisonville is not a charter city, but is a city of the "Fourth Class," organized under general statutes governing cities of that class. Therefore its power to levy license taxes must be "conferred by statute." The statute relied upon by appellee as conferring the power to impose this tax is section 7046, Rev. St. Mo. 1929 (formerly section 8497, Rev. St. Mo. 1919, as amended by Laws of 1923, p. 267), which is a grant of power to cities of the fourth class to levy license taxes.¹

While this section, after an extended enumeration of avocations, uses the words "and all other business, trades and avocations whatsoever," the Missouri decisions seem to nullify this provision and to hold, not only that it does not extend the enumerations, but that it has not even the value of allowing application of the doctrine of ejusdem generis. Keane v. Strodtman, 323 Mo. 161, 18 S.W.(2d) 896, 898; Siemens v. Shreeve, 317 Mo. 736, 296 S. W. 415, 416; Viquesney v. Kansas City, 305 Mo. 488, 266 S. W. 700; Pierce City v. Hentschel (Mo. Sup.) 210 S. W. 31; Kansas City v. Grush, 151 Mo. 128, 52 S. W. 286, and see Kansas City v. Lorber, 64 Mo. App. 604. In the Siemens Case, the court traces the judicial history (St. Louis v. Laughlin, 49 Mo. 559; St. Louis v. Herthel, 88 Mo. 128; City of St. Louis v. Bowler, 94 Mo. 630, 7 S. W. 434) which led up to the enactment of this section and in which cases the...