City of Newport v. French Bros. Bauer Co.

• Citation: 169 Ky. 174,183 S.W. 532
• Parties: CITY OF NEWPORT v. FRENCH BROS. BAUER CO. [a1]
• Decision Date: 15 March 1916
• Court: Court of Appeals of Kentucky

183 S.W. 532

169 Ky. 174

CITY OF NEWPORT v. FRENCH BROS. BAUER CO. ^[a1]

Court of Appeals of Kentucky.

March 15, 1916

Appeal from Circuit Court, Campbell County.

Action by the French Bros. Bauer Company against the City of Newport. From a judgment for plaintiff, defendant appeals. Reversed and remanded.

Otto Wolff, of Newport, for appellant.

H. B Mackoy and Mackoy & Mackoy, all of Cincinnati, Ohio, for appellee.

HURT J.

The appellant, city of Newport, which is a municipal corporation of the second class, in 1896 adopted an ordinance, which was amended in 1897, and which, as amended, was in force in 1910 and 1911. The ordinance referred to prohibited any person corporation, or company carrying on any trade, business, or profession within the city without first having obtained a license therefor as provided by the ordinance. By one section of the ordinance a license tax of $10 per annum was imposed upon any one doing business as a huckster where the business was pursued upon foot, and $20 per annum when the business was carried on with a wagon, but, when carried on with a wagon, the license entitled the holder to the use of but one wagon, and the wagon to be accompanied by not more than two persons. By another section of the ordinance a license tax of $10 per annum was imposed upon any one doing business as a peddler in the city if the business was pursued upon foot and $20 per annum if carried on with a wagon, but the license only entitled the holder to the use of one wagon, and to be accompanied by not more than two persons. The license taxes imposed by the ordinance were to be used for the purpose of paying the expenses of maintaining the government of the city. There was in force another ordinance of the city in 1910 and 1911 which imposed an annual license tax of $10 upon each person, corporation, or company engaged in the business of vending milk, whether carried on with a wagon or in a depot. The taxes so imposed were set apart and appropriated to the police fund of the city.

In 1912 the city adopted an ordinance by the terms of which a license tax of $10 per annum was imposed upon any one vending milk from a store or depot, except a grocery store, and $15 per annum upon the business of vending milk from a wagon, and, where more than one wagon was used in the business by any one holding a license, the additional wagon or wagons were required to pay a vehicle license tax. By the same ordinance a license tax of $10 per annum was imposed upon any one doing business as a peddler if the business was conducted upon foot, but, if the business was carried on with a wagon, the tax imposed was $25 per annum; but a license only authorized the holder to use one wagon, to be accompanied by not exceeding two persons. These taxes were set apart by the ordinance to the payment of the expenses of the city government. All ordinances and parts of ordinances theretofore enacted, and which related to the subjects dealt with by this ordinance, were repealed.

During the years 1910, 1911, 1912, and 1913 an ordinance was in force the style of which was as follows:

"An ordinance providing for the classification and licensing of vehicles plying the streets of the city of Newport, Kentucky, and prescribing a penalty for the violation of said ordinance." This ordinance required all persons, corporations, and companies using any vehicles on the streets of the city to procure a license for same. Two of the classifications made of vehicles were a wagon with springs drawn by one horse and a wagon with springs drawn by two horses. The annual license tax upon the vehicle drawn by one horse was $3, and upon the two-horse wagon the sum of $5. The person holding such a license was required to place a plate on the side of the vehicle which was licensed, which should designate the kind of license. It was made the duty of the police officers to enforce the provisions of the ordinance, and the license fees, which were to be used for the payment of the expenses of the city government, were set apart to the street repair fund of the city.

Under all of the above-named ordinances, the police officers were authorized to demand a production of the license by any person holding same. Under these ordinances the appellee obtained the following licenses and paid the following license taxes:

1910, May 26, milk vender's license .... $10 00

1910, May 26, butter business license ... 20 00

1911, May 12, milk vender's license ..... 10 00

1911, Feb. --, peddler's license ........ 20 00

1912, May 14, milk vender's license ..... 15 00

1912, May 14, peddler's license ......... 25 00

1913, May 14, milk vender's license ..... 15 00

1913, May 13, peddler's license ......... 25 00

1911, Feb. --, two 2-horse vehicles ..... 10 00

1911, Feb. --, nine 1-horse vehicles .... 27 00

1911, May 22, one 1-horse vehicle ........ 3 00

1912, Feb. 2, two 2-horse vehicles ...... 10 00

1912, Feb. 2, ten 1-horse vehicles ...... 30 00

1912, June --, one 2-horse vehicle ....... 5 00

1913, Feb. 6, three 2-horse vehicle ..... 15 00

1913, Feb. 6, ten 1-horse vehicles ...... 30 00

The appellee, alleging that it was a corporation organized and existing under the laws of the state of Ohio, and engaged in producing, selling, and delivering bakery goods, butter eggs, milk, cream, and ice cream, brought this suit, by which it sought to recover of appellant the license taxes paid to it, and to enjoin the city from further collecting such taxes from it, and from interfering with it in the conduct of its business by enforcing the penal features of the ordinances against it because of its failure to pay the license taxes imposed. The petition alleged, in substance, that appellee maintained storehouses in the city of Cincinnati, Ohio, and transacted a portion of its business in the appellant city; that it delivered bakery goods, butter, eggs, milk, crcam, and ice cream, or such part of same as were sold to persons in Newport, Ky. upon contracts of sale therefor, which contracts were made by orders received at its storehouses in Cincinnati, Ohio, and these orders were received in the last-mentioned city through solicitors, drummers, and drivers for appellee, or by letter or telephone from persons in Newport; that at the time the orders were received the goods were situated in Ohio, and subsequently, in the performance of the contracts, the goods or such part of them as had been sold under the contracts were carried in their vehicles and delivered to the persons who ordered them in Newport; that, with the exceptions thereafter mentioned, the persons to whom the goods were delivered were regular customers; that their vehicles make daily visits to such persons for the purpose of soliciting sales by the drivers of the vehicles; that the larger number of the persons to whom the goods were sold and delivered in Newport were regular customers and retail dealers in such goods; that by general arrangement made through standing orders prior to or at the beginning of deliveries to some of the regular customers it kept them supplied with goods, other than bakery goods, without any specific orders being made in advance of a visit to them by the vehicles; that at the times of their visits to them the drivers of the vehicles, in accordance with the general arrangement, delivered to them so much of the goods as they desired, but the products so delivered were of the same description as those called for in the standing orders, and were delivered upon the same credits as specified in the standing orders; that for the purpose of filling the standing orders the vehicles carried a sufficiency of goods, other than bakery goods, but, with the exception of such products, other than bakery goods, loaded on its vehicles for the purpose of filling the standing orders and in process of transportation, the appellee at no time ever had any goods not sold previous to the time of delivery in Kentucky, and had never maintained any warehouse, storeroom, or other place of business in Kentucky; that at no time in Kentucky had appellee ever solicited the sales of any goods, except as above mentioned, nor offered them for sale to the general public, nor carried them about for sale, except that once in a great while it sold a bundle or carton of butter or eggs or a bottle of milk or cream from one of its wagons on the road to some person who asked to purchase same who was not a regular customer, and who signified that he would or might become a regular customer if the butter, eggs, milk, or cream was sold to him and should prove satisfactory; that all of the goods, other than bakery goods, and excepting eggs, were packed by appellee at its storehouses in Ohio in separate and distinct packages, consisting of bottles, cans, cartons, bundles, as the form and nature of the particular product required, and according to the custom of appellee and those who constituted the trade in general and who deal in such products, and were then carried in appellee's vehicles and delivered in Kentucky in the same form as that in which they were carried, the packages remaining intact and unbroken; that the license fees above named should not have been exacted from it, because it had never been a peddler nor a milk vender in Kentucky; that the ordinance imposing the license tax upon milk venders is discriminatory and void; that the license taxes required of it under the several ordinances are restraints and regulations of interstate commerce and in contravention of article 1, § 8, par. 3, of the federal Constitution; and that the taxes were collected by appellant and paid by it under a mutual mistake of both it and the city to the effect that such taxes could be lawfully required of it, and the penal features of the...