Champlain Val. Exposition, Inc. v. Village of Essex Junction

• Decision Date: 05 June 1973
• Docket Number: No. 177-72,177-72
• Citation: 309 A.2d 25,131 Vt. 449
• Court: Vermont Supreme Court
• Parties: CHAMPLAIN VALLEY EXPOSITION, INC., and Harry F. Koch, d/b/a King Reid Shows v. VILLAGE OF ESSEX JUNCTION.

Page 25

309 A.2d 25

131 Vt. 449

CHAMPLAIN VALLEY EXPOSITION, INC., and Harry F. Koch, d/b/a King Reid Shows v. VILLAGE OF ESSEX JUNCTION.

No. 177-72.

Supreme Court of Vermont.

June 5, 1973.

Reargument Denied Aug. 30, 1973.

Eric A. Shuppin, Essex Junction, Henry F. Blach, of Blach & Plante, White River Junction, on the brief, for plaintiffs.

Kolvoord, Overton & Wilson, Essex Junction, for defendant.

Before SHANGRAW, C. J., and BARNEY, SMITH, KEYSER and DALEY, JJ.

DALEY, Justice.

This action was brought by Champlain Valley Exposition, Inc., and Harry F. Koch, d/b/a King Reid Shows, to enjoin the enforcement of two ordinances of the Village of Essex Junction against them.

The first ordinance enacted by the Village in 1971, and amended soon thereafter, imposed an admission tax in the amount of 10% of each admission charge levied by a person or corporation engaging in the business of entertainment or amusement. Provision was made in the ordinance for the filing of a statement indicating the number and prices of admission charges collected and for remittance of the amount of the tax levied by the ordinance. Upon failure of the taxpayer to file the statement, further provision was made for the Village Tax Collector to determine the amount due and impose a lien upon the property of the taxpayer who failed to remit the tax. A penalty was provided for the non-payment of the tax, and willful violation of the ordinance was made a misdemeanor with a fine of not less than $300 nor more than $500 upon conviction. Finally, the revenues generated from the tax would go into the general fund of the Village, to be used for its general purposes.

The Village of Essex Junction sought to impose the first ordinance upon Champlain Valley Exposition, Inc. (Champlain), a Vermont corporation promoting and maintaining an agricultural fair upon real estate it owned within the Village of Essex Junction. In imposing this tax upon Champlain, the Village sought to tax the general admission charge to the fair and the general admission charge to shows held in the grandstand at the fairgrounds.

The other ordinance was enacted by the Village in 1971, and it imposed a $10.00 per day license fee for each individual show, exhibit, or riding device operated within the Village. The license permit was to be obtained from the Village manager's office, and provision was made for the Village manager and police department to enforce the licensing provisions. Excluded from the license fee were those who were subject to the admissions tax. Violation of the provisions of the ordinance carried with it a fine of not less than $300 nor more than $500.

The Village of Essex Junction sought to interpose the license fee provided for in the other ordinance upon Harry F. Koch, d/b/a King Reid Shows (King Reid Shows), which consists of a large number of entertainment rides, exhibits, and amusements collectively presented at agricultural and other fairs in New England and Canada by Harry Koch. King Reid Shows does not own all the concessions presented under its banner, and some of the concessionaires are individual proprietors who rent stall space from King Reid Shows and operate their concessions under the control of King Reid Shows. At the time the action was brought, King Reid Shows and Champlain had contracted between themselves that for the next five years King Reid Shows would operate its show at the annual agricultural fair presented by Champlain.

After the parties stipulated to the facts, the trial court made its findings of fact and conclusions of law upon those facts and the other exhibits provided by the parties. In its judgment order the trial court adjudged the admission tax ordinance to be properly enacted pursuant to 24 V.S.A. § 2291(11); however, it also adjudged Champlain to be exempt from the ordinance because it came within the purview of a portion of the ordinance which excluded from its provisions corporations conducting or providing entertainment or amusements where the admission charges are to be used exclusively for charitable or educational purposes. The trial court also adjudged the licensing ordinance to be properly enacted pursuant to 24 V.S.A. § 2291(11) and 31 V.S.A. § 401 decreed the fees to be not excessive, and adjudged the licensing fee to be valid and enforceable against King Reid Shows. The trial court then ordered King Reid Shows to pay the amounts due to the Village under the licensing fee unto the Village of Essex Junction, and enjoined the Village from collecting the admissions tax from Champlain. From this judgment order, all the parties to this action have appealed to this Court for review.

The first matter presented for our review concerns the ordinance pursuant to which the Village sought to levy an admissions tax on the admission charges collected by Champlain. In this respect, Champlain contends that the ordinance exceeds the authority granted to the Village to regulate under 24 V.S.A. § 2291(11), and, in the alternative, Champlain contends it is an exempt corporation under 32 V.S.A. § 3902(9). In a cross-appeal, the Village contends the ordinance, lawfully enacted, does not exempt Champlain because an amendment to Champlain's articles of association, providing that upon liquidation, its assets would be distributed to a charitable, religious, or educational organization and 3802(9). In a cross-appeal, the Village with the Secretary of State at the time the case was heard below, and until it had been filed Champlain was not a charitable or educational corporation within the meaning of the exclusions found in the ordinance.

At the outset our inquiry must focus upon the enabling statute pursuant to which the Village enacted its ordinance providing for an admission tax on entertainment or amusements. In that regard, a determination must be made whether or not the ordinance is the result of a proper exercise of the delegated municipal power contained within 24 V.S.A. § 2291, which provides in part:

'For the purpose of promoting the public health, safety, welfare and convenience a town, city or incorporated village shall have the following powers:

(11) To regulate, license, tax or prohibit circuses, carnivals and menageries, and all plays, concerts, entertainments or exhibitions of any kind for which money is received.'

It is clear that the statute, 24 V.S.A. § 2291(11) confers upon municipalities' broad powers to tax circuses, carnivals, and menageries of any kind so long as those powers are exercised for the purpose of promoting the public health, safety, welfare, or convenience of the municipality. On the other hand, it is also clear the ordinance which was enacted by the Village seeks to impose a tax upon admissions for the sole purpose of raising revenue, and, as a consequence, makes no attempt to meet the purpose found in the enabling act. Compare State v. Bevins, 70 Vt. 574, 579, 41 A. 655 (1898). Because of the failure of the ordinance to meet the purpose set forth by the legislature in the enabling act, it does not bear a real and substantial relationship to the public health, safety, welfare, and convenience, and therefore must be held to be invalid. See generally 9 E. McQuillin, Municipal Corporations § 26.24 Pp. 58-59 (3d ed. rev. F. Ellard 1964); Kirsch Holding C. v. Borough of Manasguan, 24 N.J.Super. 91, 93 A.2d 582 (1952). See also Vermont Salvage Corp. v. Village of St. Johnsbury, 113 Vt. 341, 350, 34 A.2d 188 (1952).

Since the ordinance providing for the admissions tax is in excess of the authority granted to the Village by the enabling statute, pursuant to which the ordinance was enacted, we need not discuss the other contentions raised as to this ordinance by the parties.

The second matter presented for our review is the ordinance providing for the issuance of license permits and the collection of a $10.00 per day license fee for each individual show exhibit or riding device operated within the Village. King Reid Shows contends the ordinance exceeds the authority granted to the Village in the enabling act because the Village trustees are without authority to pass such an ordinance and the fees collected thereunder are excessive and beyond the authority conferred in the enabling act.

The Village trustees used as their authority to enact the ordinance licensing King Reid Shows 24 V.S.A. § 2291(11) and 31 V.S.A. § 401 et seq. King Reid Shows' argument that the Village Trustees are without authority to pass the ordinance rests upon those portions of 31 V.S.A. § 401 which provide: 'Selectmen may permit the exhibition in their town of any show . . .' and the fees received for the permits are 'for the use of the town . . ..' Because of this, King Reid Shows contends 31 V.S.A. § 401 limits the issuance of permits to selectmen of towns, and, as a consequence the Village trustees were without authority to enact the ordinance. The interpretation of the authority granted by the legislature in this area argued for by King Reid Shows is unduly restrictive, for it ignores 24 V.S.A. § 2291(11) which...