City and County of Denver v. People

• Decision Date: 14 February 1939
• Docket Number: 14367.
• Parties: CITY AND COUNTY OF DENVER v. PEOPLE.
• Court: Colorado Supreme Court

88 P.2d 89

103 Colo. 565

CITY AND COUNTY OF DENVER v. PEOPLE.

No. 14367.

Supreme Court of Colorado, En Banc.

February 14, 1939

Rehearing Denied March 13, 1939.

Error to District Court, City and County of Denver; Henry S Lindsley, Judge.

Action by the People against the City and County of Denver to recover 85 per cent. of liquor license fees collected by defendant in order to place them in the state old-age pension fund. Judgment for plaintiffs, and defendant brings error.

Affirmed.

YOUNG KNOUS, and BURKE, JJ., dissenting.

Malcolm Lindsey and Thomas H. Gibson, both of Denver, for plaintiff in error.

Byron G. Rogers, Atty. Gen., and Reid Williams, Asst. Atty. Gen for the People.

BAKKE Justice.

Action by the people to recover of and from the City and County of Denver, a municipal corporation, eighty- five per cent of the license fees collected by said city under the provisions of chapters 82 and 142, pp. 250, 597, Session Laws 1935, subsequent to January 1, 1937, and to permit their availability for the old age pension fund. The people were successful below, and it is to review the judgment in their favor, entered on the over-ruling of the city's demurrer, that the writ of error herein is prosecuted by the city.

The city's single assignment of error is, 'The court erred in overruling the demurrer of the defendant to the complaint of the plaintiff.'

The demurrer contained two grounds. The first was alleged insufficiency of facts, which we need not consider because, if the constitutional objections urged are not sound, the complaint does state sufficient facts to constitute a cause of action. The second ground was as follows:

'That said complaint is framed upon the theory and is based upon a construction of that certain Amendment of the Constitution of Colorado that was enacted by the people at the November 1936, election, and entitled 'An Act Amending the State Constitution by adding thereto a new Article concerning Old Age Pensions, and providing funds for the payment thereof,' under which the plaintiff, in substance, claims that the Old Age Pension Fund created and established in the Treasury of the State of Colorado by said Amendment, was and is intended to include, and includes, 85% of the Liquor License Fees of the defendant for the collection of which special provision is made by chapter 142 Session Laws of 1935 (page 597), and 85% of the Liquor Fees of said City and County of Denver on fermented, malt beverages for the collection of which special provision is made by chapter 82, Session Laws of Colorado 1935 (page 250), and the said constitutional amendment if, when and as so construed is in violation of and repugnant to:

'1. Section 24 of Article 5 of the Colorado Constitution [Revival, amendment and extension of laws].

'2. Section 25 of Article 2 of the Colorado Constitution [Due process of law.]

'3. Section 6 (as amended), of Article 20 of the Colorado Constitution [Home rule for cities].

'4. So much of the Fourteenth Amendment of the Constitution of the United States of America, U.S. C.A., as provides as follows: 'Nor shall any State deprive any person of life, liberty or property without due process of law; nor deny to any persons within its jurisdiction the equal protection of the laws.''

'5. Section 10, Article 1 of the Federal Constitution, U.S. C.A. [Ex post facto laws. Obligation of contracts.]

'6. Section 11, Article 2 of the Colorado Constitution [Ex post facto laws.]'

The crux of this litigation is the construction to be given to, and the legal effect of, that part of section 2 of the Old Age Pension Amendment, (Const. art. 24), chapter 200, Session Laws 1937, page 881, reading as follows:

'Section 2. There is hereby set aside, allocated and allotted to the Old Age Pension Fund sums and money as follows: * * * (b) Beginning January 1, 1937, eighty-five per cent of all net revenue accrued or accruing, received or receivable from taxes of whatever kind upon all malt, vinous or spirituous liquor, both intoxicating and nonintoxicating, and license fees connected therewith.'

Since January 1, 1937, the city has collected certain liquor license fees under the provisions of chapters 142 and 82, Session Laws 1935, chapter 89, volume 3, '35 C.S.A. (being the intoxicating and nonintoxicating liquor laws respectively), and now seeks to retain them as part of its general fund. The people contend that under section 2(b), such fees must be turned over to the state treasurer to be placed in the old age pension fund.

We shall consider the questions in the order set forth in the demurrer.

1. Section 24, article 5 of the State Constitution reads as follows: 'No law shall be revived, or amended, or the provisions thereof extended or conferred by reference to its title only, but so much thereof as is revived, amended, extended or conferred, shall be re-enacted and published at length.'

All that would be necessary, if we desired to summarily dispose of this question, would be to say that we have specifically held that this section of the amendment does not violate this constitutional provision. In re Interrogatories of the Governor, 99 Colo. 591, 65 P.2d 7. However, since no reason was there assigned, we may repeat our pronouncement in Denver Circle R. Co. v. Nestor, 10 Colo. 403, 409, 15 P. 714, 718, where, after a discussion of the purposes of this provision (section 24 of article 5), we said, 'We also indorse the salutary rule that the argument ab inconvenienti is not to be permitted to influence the courts to defeat by construction a constitutional mandate.' It also may be added that in the opinion in the principal Colorado case relied upon by the city on this point (People v. Friederich, 67 Colo. 69, 74, 185 P. 657, 659), we quoted from Callahan v. Jennings, 16 Colo. 471, 27 P. 1055, as follows: 'The intent and wisdom of this provision are obvious. It was framed for the purpose of avoiding confusion, ambiguity and uncertainty in the statutory law through the existence of separate and disconnected legislative provisions, original and amendatory, scattered through different volumes or different portions of the same volume.'

What appears to be the general rule holds that it (section 24, article 5) was not intended to abolish the power of the legislature (a fortiori, the people) to enact measures which amend pre-existing legislation by implication only. 59 C.J. 871, and Colorado cases cited.

2. Does the attempted taking of these license fees violate the due process clause of the Colorado (section 25 of article 2) and federal (Fourteenth Amendment) Constitutions? Assuming for the moment that the city has a property right in the license fees here involved (a question which we shall later discuss), it does not necessarily follow that, in so far as our state Constitution is concerned it may invoke the due process clause, because section 28 of article 2 provides: 'The enumeration in this constitution of certain rights shall not be construed to deny, impair or disparage others retained by the people.' The most important retention is the right of the people to amend their Constitution in any manner they see fit, so long as such amendments are not repugnant to the Constitution of the United States. Whether any repugnancy to the federal Constitution is shown, also will be discussed later.

3. There is no merit in the contention that the act under consideration violates section 6, article 20 of the state Constitution because the collection of these license fees is a local and municipal matter. No one would seriously contend that the granting of licenses for the manufacture and sale of intoxicating liquors is not an incident of the liquor traffic and controllable as such. 'This presents for consideration the question of whether article 22 applies to the whole state, and if this be determined in the affirmative, the question of whether the control of the sale of intoxicating liquors under article 20 ever was exclusively a matter of local and municipal concern is eliminated and need not be determined.' People v. Denver, 60 Colo. 370, 374, 153 P. 690, 691. As to whether or not said article 22 (as amended in 1932) applies to the whole state has been 'determined in the affirmative.' City of Colorado Springs v. People ex rel., 99 Colo. 525, 527, 63 P.2d 1244.

4. City contends further that a construction which upholds the people's demand for these license fees would violate section 10, article 1 of the federal Constitution and violate and impair a contractual obligation and would enforce an ex post facto law. It is on this point that the violation of the due process clause also hinges, because it cannot be violated if the city has no property right in the subject of the controversy. City further contends that it has some sort of a vested right to these funds because they were collected under chapters 82 and 142, supra, which are unrepealed, but its position in this behalf is refuted by language quoted from cases cited by its counsel, e. g., 'a tax levy by a municipality, germane to the purposes for which it was incorporated, not in excess of a limitation fixed by the Constitution * * *.' City of Portland v. Welch, 154 Or. 286, 59 P.2d 228, 223, 106 A.L.R. 1188. 'We think it is also manifest that all revenues coming into the treasury of a municipality in pursuance of law, unless the law specifically provides otherwise, becomes a part of its general fund * * *.' State v. Sheppard, 79 Wash. 328, 330, 140 P. 332, 333, and, 'No man shall be 'disseised of his property except by the law of the land.'' Bailey v. City of Raleigh, 130 N.C. 209, 41 S.E. 281, 58 L.R.A. 178.

The attempt of the city herein to keep these license fees would be in excess of the limitations fixed by our Constitutions. The...