City of Richmond Heights v. LoConti

• Decision Date: 07 August 1969
• Citation: 250 N.E.2d 84,19 Ohio App.2d 100
• Parties: , 48 O.O.2d 227 CITY OF RICHMOND HEIGHTS, Appellee, v. LoCONTI, Appellant.
• Court: Ohio Court of Appeals

Page 100

19 Ohio App.2d 100

250 N.E.2d 84, 48 O.O.2d 227

CITY OF RICHMOND HEIGHTS, Appellee, v. LoCONTI, Appellant.

Court of Appeals of Ohio, Eighth District, Cuyahoga County.

Aug. 7, 1969.

Syllabus by the Court

1. A law or ordinance which requires the obtaining of a license as a prerequisite to engaging in a particular business or activity may be a proper exercise of the police power, but it must bear some reasonable relation to the health, safety, morals or general welfare of the public, and may not interfere with private business by imposing arbitrary, discriminatory, capricious or unreasonable restrictions thereon. City of Cincinnati v. Correll, 141 Ohio St. 535, 539, 49 N.E.2d 412.

2. Where a particular activity being licensed bears no greater relation to the burdens supposedly necessitating the license than do other nonlicensed activities, such license requirement is unconstitutionally arbitrary and discriminatory, and therefore invalid.

3. A license fee may be required of one required to obtain a license, but the amount of such fee must bear a reasonable relation to the burdens imposed, by the activity being licensed and by the licensing process itself, upon the governmental entity involved.

4. Where a license fee is significantly in excess of the amount needed to support such burdens, such fee is unreasonable and therefore unconstitutional.

Charles E. Merchant, Prosecutor, city of Richmond Heights, for appellee.

George P. Allen, Cleveland, for appellant.

SILBERT, Chief Justice.

This is an appeal on questions of law from a judgment against defendant in the Lyndhurst Municipal Court which has jurisdiction over the city of Richmond Heights.

Defendant was convicted of violating Section 705.05 of the Codified Ordinances of the City of Richmond Heights. That section reads as follows:

§ 705.05 DISTRIBUTOR'S LICENSE.

'No person shall distribute mechanical amusement devices or juke boxes within the corporate limits by lease, conditional sale or any financial conditional method without a distributor's license.

'A distributor, also being known as an operator, shall first obtain a distributor's license from the Mayor upon the payment of the annual license fee of one hundred dollars ($100.00). This license fee shall be for the fiscal year beginning January 1 of the calendar year or for any unexpired portion of the fiscal year.

'Nothing in this section shall be intended to prohibit any person or the owner of a place of business to purchase the mechanical amusement device outright from any source, provided compliance is made for the annual license as hereinbefore set forth and upon presentation of a bill of sale therefor.' (Emphasis added.)

One who so distributes any of the designated devices without first obtaining such a license is to be fined not more than $500. (Section 705.09)

Defendant was arrested, tried and convicted of violation of the ordinance, and was assessed a fine. Defendant brings this appeal.

Several pertinent facts relevant to this case have been set forth in stipulations by the parties, as follows:

'6. Henry LoConti has only one (1) place of business in the city of Richmond Heights in which he installed a juke box. The place of operation is a small pizza shop called DeMarco's.

'7. Henry LoConti did not purchase the One Hundred Dollar ($100.00) license. Henry LoConti had knowledge of the One Hundred Dollar ($100.00) license, but felt the amount of the license was unjust and confiscatory.

'* * *

'9. The cities of South Euclid and Richmond Heights have the same type of distributor's license. However, Cleveland, Parma and Lakewood do not have a distributor's license, but do require a location license.

'10. In Richmond Heights, each distributor must purchase an annual license for One Hundred Dollars ($100.00) if he has only one place of business or if he has many. However, within the entire City of Richmond Heights, there are only eight (8) to fifteen (15) possible locations.

'11. The City of Richmond Heights does not charge a license fee for distributors of towel service, food or beverage distributors, or other distributors operating within the City of Richmond Heights, Ohio.

'12. From January 7, 1965, to December 27, 1965, the gross income derived from one juke box amounted to Five Hundred Fifty Dollars and Sixty Cents ($550.60). This juke box was located at DeMarco's in Richmond Heights Ohio. Of this gross income, the location owner received Two Hundred Forty-two Dollars and Eighty-five Cents ($242.85) and the distributor or operator received Three Hundred Seven Dollars and Seventy-five Cents ($307.75). From the latter sum, the distributor or operator paid for his cost of service, repairs, tax, records, other supplies and depreciation.' (All emphasis added.)

In the general index to the Codified Ordinances of the City of Richmond Heights, there are certain items of relevance herein. Under the heading of 'Pinball,' there is the notation '(see MECHANICAL AMUSEMENT DEVICES).' Neither in the index, under the heading, 'Mechanical amusement devices,' nor in the text of the ordinances falling within that subject, is there any reference by name to 'pinball' or 'pinball machine.' Under the index heading, 'Gambling,' there is a subheading, 'mechanical amusement devices,' with a reference to Section 705.08. That ordinance provides that no person shall give any prize, etc., to a player or operator of any mechanical amusement device or to a contestant 'for a high score on the device.' The same ordinance is referred to under two subheadings within the index heading of 'Mechanical amusement devices': 'gambling,' and 'prizes or awards.'

Section 705.01 of the city ordinances reads, in its entirety, as follows:

§ 705.01 DEFINITIONS.

'For the purpose of this chapter:

'(a) 'Mechanical amusement device' shall mean a machine which, upon the insertion of a coin or slug, operates or may be operated for use as a game, contest or amusement of any description, or which may be used for any game, contest or amusement and, which contains no automatic pay-off device for the return of money, coins, merchandise or tokens or checks redeemable in money or anything of value.

'(b) 'Juke box' shall mean any music vending machine, contrivance or device which, upon the insertion of a coin, slug, token, plate, disc, or key into any slot, crevice or other opening, or by the payment of any price, operates or may be operated, for the emission of songs, music or similar amusement.'

We interpret all of the above to indicate beyond any doubt that:

(1) For certain purposes, especially distribution, the City Council of Richmond Heights has seen fit to consider juke boxes and other mechanical amusement devices as ejusdem generis;

(2) In another connection (prohibition of gambling), the council has chosen to deal only with 'mechanical amusement devices,' without mentioning juke boxes. Thus, under the doctrine, inclusio unius est exclusio alterius, it would have to be said that the Council of Richmond Heights does not regard 'juke boxes' as being devices intended for, or capable of use in, gambling.

It is widely held that a license fee is not one for the raising of revenue, but is for regulatory purposes only. See, e. g., Pacific Tel. & Tel. Co. v. City of Seattle (1933), 172 Wash. 649, 654, 21 P.2d 721, 723, affirmed, 291 U.S. 300, 54 S.Ct. 383, 78 L.Ed. 810; Pennsylvania Liquor Control Bd. v. Publicker Commercial Alcohol Co. (1943), 347 Pa. 555, 559-560, 32 A.2d 914, 917; Matheny v. City of Hutchinson (1942), 154 Kan. 682, 686, 121 P.2d 227, 230-231, 151 A.L.R. 1187, 1191-1192.

The courts of Ohio concur in this view, and make it clear that the power of a municipality to regulate through the means of a license is a police power under Section 3 of Article XVIII of the Ohio Constitution. Auxter v. City of Toledo (1962), 173 Ohio St. 444, 446, 183 N.E.2d 920; paragraph 1 of the syllabus in Village of West Jefferson v. Robinson (1965), 1 Ohio St.2d 113, 205 N.E.2d 382.

There can be no doubt that the ordinance involved herein is intended to be strictly a license. Indeed, this is freely admitted by the city in its brief, wherein it contends, '* * * (I)t is certainly far beyond the realm of reason to hold that the license fee is unreasonable and a source of revenue raising by the city of Richmond Heights.'

We note that the city ordinances impose additional license fees on those who 'display or exhibit a mechanical amusement device or juke box.' There is an annual fee of $25 per machine on each 'mechanical amusement device' and an annual fee of $10 per machine on each 'juke box.' Thus, although the license fees for distribution of both types of devices are the same, the fees for display of these two types are significantly different. It is obvious that the municipality feels that the regulation at the location site of the operation of 'mechanical amusement devices' justifies a higher license fee than does such regulation of the operation of juke boxes. The classification of juke boxes, under Section 705.01, as being separate and distinct from other 'mechanical amusement devices' is in accord with the difference in the respective license fees for display of the machines. Moreover, the fact that the amount of the license fee paid by those who display both types of machines is determined by the number of machines, is indicative of the fact that the license fee is connected to expenses of municipal regulation. We cannot ignore that there is no such logical connection regarding the license fee for distributors.

The courts of Ohio have upheld ordinances regulating and even prohibiting 'pinball' machines. Although the ordinary operation of such machines themselves is not inherently unlawful, the determination of a city council that such machines may readily be used for gambling is part of a municipality's discretion under the police power granted by Section 3, Article XVIII of the Ohio Constitution. Benjamin v....