City of Newport v. Wagner

• Decision Date: 23 February 1916
• Citation: 182 S.W. 834,168 Ky. 641
• Parties: CITY OF NEWPORT v. WAGNER ET AL. [a1]
• Court: Kentucky Court of Appeals

182 S.W. 834

168 Ky. 641

CITY OF NEWPORT v. WAGNER ET AL. ^[a1]

Court of Appeals of Kentucky.

February 23, 1916

Appeal from Circuit Court, Campbell County.

Action by W. T. Wagner and others against the City of Newport. Judgment for plaintiffs, and defendant appeals. Reversed and remanded.

Otto Wolff, of Newport, for appellant.

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

HURT J.

On the 30th day of April, 1896, the general council of the city of Newport, which is a city of the second class, adopted an ordinance which is entitled "An ordinance requiring persons, corporations and companies carrying on business occupations or practicing their professions in the city of Newport to take out a license tax therefor, and prescribing a penalty for the failure of such person, corporation, or company so to do." This ordinance was amended on April 30, 1910. By the terms of this ordinance each person corporation, or company, before being permitted to carry on any trade, business, or profession in the city of Newport, must first have obtained a license therefor. The ordinance prescribed in what manner the license should be obtained, to whom the tax was payable, and the amount of the license tax required for the carrying on of each trade, business, or profession, and further provided that the person, corporation, or company holding such a license should exhibit it in some conspicuous place in the house wherein the business was carried on, or, if the person holding the license should do business on foot, he should have the license with him, and in case of peddlers or hucksters or other persons doing business with vehicles should have a tag or tags placed in a conspicuous place upon his vehicle indicating that he was a holder of such license. By section 10 of the ordinance the license fee imposed by the ordinance levied and collected should be for the purpose of paying the expenses of maintaining the city government. By other provisions of the ordinance a penalty was imposed upon such persons, corporations, or companies as violated the ordinance, and fixed the penalties to be imposed upon them, which was a fine which might be imposed by the police court.

The license tax required by the ordinance for each person, corporation, or company engaging in manufacturing or wholesale dealing in "soft drinks" was the sum of $150. A similar ordinance, so far as it has any application to wholesale dealers, was adopted by the general council of the city on the 1st day of April, 1912, and which repealed the prior ordinance on the subject. While the two ordinances above mentioned were in force, the appellees, W. T. Wagner & Sons, took out licenses during the years 1910, 1911, 1912, and 1913, for the privilege of engaging as wholesale dealers in the business of selling "soft drinks" by the wholesale, and paid the license tax for each year, in all amounting to the sum of $600.

The appellees brought this suit in the Campbell circuit court against the appellant, city of Newport, alleging that they, under a mutual mistake of themselves and the appellant that they were compellable, in order to carry on the business of a wholesale dealer in "soft drinks" in the city of Newport, to procure a license and pay the tax required by the ordinance, and in default of so doing would incur the penalties denounced by the ordinance, had paid the license tax for the years 1910, 1911, 1912, and 1913, amounting in all to the sum of $600. They further alleged that they were a partnership, and were engaged in manufacturing, selling, and delivering the different waters and drinks commonly known and described as "soft drinks" in the city of Cincinnati and state of Ohio, and during the years for which they had paid the license taxes did a portion of their business in Newport, Ky.; that the business carried on by them in Newport was conducted as follows:

"Their goods were manufactured in Cincinnati, and were sold and delivered to the retail dealers in such goods in Newport; that the deliveries, except as hereinafter stated, were made upon contracts of sale therefor; that these contracts were made through orders received at their place in Cincinnati from the persons in Newport by means of the post office or telephone, or through orders received by the solicitors of appellees, or the drivers of their wagons, which ply between their place of business in Cincinnati and Newport; that at the time the orders were received and the contracts of sale made the goods, except as hereinafter stated, were situated in the state of Ohio; that the greatest number of persons to whom the goods were delivered were regular customers of appellees, and to whom their vehicles make visits three times each week for the purpose of soliciting orders by the drivers of the vehicles, and delivering to them goods which had been previously ordered; that most of those persons who were regular customers were retail dealers, and by a general arrangement made through standing orders given prior to or at the time of the beginning of the deliveries the appellees kept them supplied with the goods without any specific orders being given in advance of a visit by appellees' vehicles, and at the time of a visit by one of appellees' wagons, in accordance with the general arrangement, did deliver to such customers so much of the goods as they might need, but the goods were of the same kind as those called for in the standing orders, and were delivered upon the same terms, in all respects, and for the same prices and upon the same credits, as specified in said standing orders, and, for the purpose of filling the standing orders, under said general arrangement, the wagons of appellees carried a sufficient amount of the goods to furnish a customer with such amount as he desired to buy, but, with the exception of the goods so carried, appellees had at no time had any goods which had not been sold at the time of delivery in Newport; that appellees once in a while sold a case of said waters and drinks from its said vehicle to some person who asked to purchase same, or to some person who had been solicited to become, or who had signified that he would or might become, a regular customer of said waters and drinks, if those so sold to him should prove satisfactory; that all of their goods were manufactured and bottled at their plant in Cincinnati, and were put in covered and fastened bottles and siphons, and there packed in separate and distinct packages or cases, 'as the nature and form of the particular waters or drinks required, and according to the custom of appellees and those persons who manufacture and sell said waters and drinks, and who constitute the trade in general, and were then shipped in appellees' vehicles and delivered to appellees' said customers in said city of Newport, in the same form and shape as that in which they had been shipped and carried'; that said goods remained in unbroken packages, and in the same form and shape, at all times, from the point of shipment to the point of delivery, and none of said packages were ever sold, except as an entirety."

The appellees alleged further that the provisions of the ordinance, in so far as it attempted to apply to them and to their business in the city of Newport, was in contravention of article 1, § 8, par. 3, of the federal Constitution, in that their business was at all times interstate commerce, and that the provision of the ordinance was a restraint to and regulation of interstate commerce.

The appellant interposed a general demurrer to the petition which was...