Darling Apartment Co. v. Springer

• Citation: 25 Del.Ch. 420,22 A.2d 397
• Court: Court of Chancery of Delaware
• Decision Date: 28 October 1941
• Parties: DARLING APARTMENT COMPANY, Complainant Below, Appellant, v. WILLARD SPRINGER, JR., Constituting the Delaware Liquor Commission, Defendant Below, Appellee

22 A.2d 397

25 Del.Ch. 420

DARLING APARTMENT COMPANY, Complainant Below, Appellant, v. WILLARD SPRINGER, JR., Constituting the Delaware Liquor Commission, Defendant Below, Appellee

Court of Chancery of Delaware

October 28, 1941

APPEAL from decree of the Court of Chancery for New Castle County.

Decree of the Chancellor affirmed.

William H. Bennethum, of the office of Marvel & Morford, for plaintiff in error.

William S. Potter, for defendant in error.

James R. Morford, Attorney General, in support of motion.

LAYTON C. J., and RICHARDS, RODNEY, SPEAKMAN, and TERRY, JJ. sitting. RODNEY, Judge, concurring.

OPINION

LAYTON, Chief Justice.

Darling Apartment Company operates a hotel in the City of Wilmington. In 1940 it was the holder of a license granted by the Delaware Liquor Commission to sell alcoholic liquors for consumption on its premises. It was notified that its license would be suspended for a stated period because of violation of a regulation adopted and promulgated by the Commission; and it sought to enjoin the enforcement of the order of suspension. A demurrer to its bill of complaint was sustained (ante p. 98); it elected to take final judgment; an order dismissing the bill was entered; and this writ of error was sued out.

The Delaware Liquor Commission was establed and its authority defined by Chapter 18, Volume 38, Delaware Laws, entitled, "An Act creating a Commission for the Control of the Manufacture, Distribution, Sale and Transportation of Alcoholic Liquor, Wines and Beer." With certain amendments the Act appears in the Revised Code of 1935 as Chapter 176.

By Section 5 of the Act (Rev. Code, § 6134) the Commission is authorized to adopt and promulgate rules and regulations having the force and effect of law, and specifically, "to establish by such rules and regulations an effective control of the business of manufacture, sale, dispensation, distribution and importation of alcoholic liquors' within and into the State of Delaware, including the time, place and manner in which alcoholic liquors' shall be sold and dispensed, not inconsistent with the provisions of this Chapter."

By Section 33 (Rev. Code, § 6162) the holder of a license for the sale of alcoholic liquors in a hotel, restaurant, club or tavern is forbidden to sell them between twelve o'clock midnight of any day and nine o'clock in the forenoon of the following day, except in certain stated circumstances.

Rule 79, for the violation of which the suspensive order was made, provided as follows:

"It is forbidden for any holder of a license for the sale of alcoholic liquor' other than the holder of a Gathering License' to knowingly permit the consumption of any alcoholic liquor' on the premises to which such license pertains between 12:30 o'clock in the forenoon and 9:00 o'clock in the forenoon except on the first day of January in each year * * *."

By Section 29 (Rev. Code, § 6158) the Commission may cancel or suspend any license for the sale of alcoholic liquor "if it has reasonable ground to believe: * * * That the licensee has violated" any provision of the Act or any regulation of the Commission.

It is first contended that the Commission exceeded its authority in adopting the rule for the reason that the act nowhere refers to the consumption of alcoholic liquor; and as the statute specifically recognizes the right of the licensee to sell alcoholic liquors until midnight and does not purport to regulate its consumption, the Legislature has manifested its intent not to legislate with respect to consumption of liquors legally sold, and, therefore, the regulation was outside the scope of the rule making power.

The plausibility of the argument disappears when the purpose and language of the act and the practical aspects of the traffic in alcoholic liquors are considered. The Legislature authorized the Commission to establish by rules and regulations an effective control over the sale of alcoholic liquors. It expressly provided that no sale should be made after midnight. It is true that the act does not purport to control the consumption after midnight of legally sold alcoholic liquors. But when consumption is viewed with the statutory deadline for sale, the co-relation and importance of the time limitation for the drinking of liquors legally purchased are at once discoverable; for where alcoholic liquors are authorized to be sold for consumption on the licensed premises the consumption of them is so directly and intimately related to the sale that both aspects of the traffic may reasonably be regarded as one transaction. The provision of the rule that forbids the licensee knowingly to permit alcoholic liquors to be consumed on the premises after 12:30 A. M., effectively lessens the likelihood of their purchase after midnight, and at the same time permits an adequate time for the consumption in a reasonable amount of liquors bought before midnight. Other considerations affecting the general welfare are apparent. The argument needs no elaboration. The rule is not void as one without the scope of the power delegated.

It is next contended that the grant of authority to the Commission to establish by regulations an effective control of the liquor traffic is an unlawful delegation of legislative power which is vested in the two legislative houses by Section 1 of Article II of the Constitution of this State, for the reason that the power and discretion of the Commission is undefined and unconfined by any legislative standard.

The cardinal principle to be observed by legislatures in the grant of authority to administrative bodies to make rules and regulations having the effect of law is, that there must be found in the law itself a reasonably clear formula by which the grantee of the power must be governed. Whether the act, in all of its aspects, is invulnerable against attack on this score, is not of present concern. The immediate question has to do with the hours of the day within which alcoholic liquors may not be sold; and in this respect the Legislature has unmistakably established the law. Alcoholic liquors, except in certain cases, cannot be sold legally between midnight and nine o'clock A. M. As to this the Commission was given no authority whatever. The power granted to the administrative commission was not a roving commission to exercise its discretion without restraint or limitation, and at its will to fix the hours within which alcoholic liquor might be sold; rather the power is circumscribed and limited to the making of rules and regulations whereby the established law for lawful sale might be effectively maintained. The act in this respect is not violative of the constitutional provision.

State v. Retowski, 36 Del. 330, 6 W. W. Harr. 330, 175 A. 325, and Hoff v. State, 39 Del. 134, 9 W. W. Harr. 134, 197 A. 75, are cited by the plaintiff in error in support of its contentions. These cases are of value here only for their correct statements of principles by which legislative and administrative bodies are controlled in the grant and exercise of the rule making power. They are inapposite because of their factual backgrounds.

It is next contended that the act makes no adequate provisions for publication and due notice of the adoption and promulgation of the rules and regulations by the Commission, and that, on this account and in this respect, it is unconstitutional. This question was not raised by the bill of complaint, and, accordingly, was not considered by the court below. It is not properly before this court, and will not be determined. But with the hope that some useful purpose will be served, we note in Section 5 of the act there is no provision whatever for the publication of rules and regulations adopted thereunder. By Section 8 (Rev. Code, § 6137) it is provided that the "Commission may make any regulation it may deem necessary for the carrying out of this Chapter respecting its internal economy and the conduct of its business. * * * Such regulations must be published in form open to public inspection at the office of the Commission." This language is vague and equivocal, but it is unnecessary to determine whether it was intended to relate to the publication of rules and regulations authorized under Section 5.

It is contended that Section 29 of the act authorizing the cancellation or suspension of licenses on reasonable cause for belief of violation of the act or regulation is unconstitutional because no right of appeal to a court of competent jurisdiction is afforded. The argument is elaborated by pointing out that even notice of alleged violation and a hearing of charges are not required; and it is said that such situation is intolerable and unknown to our concept of government.

This contention is basically unsound. It may be admitted that the exercise of the power of revocation or suspension only after notice and hearing would better comport with the general conception of a proper procedure. Any summary exercise of power may be regarded as harsh; but the question is one of legislative power, not of propriety. The precise nature of a license to sell alcoholic liquors must be held in mind. From very early times governments have recognized the evil effects of indulgence in intoxicating liquors and have imposed restrictions on their use. Traffic in them is generally regarded as not essential to the welfare of society, and while, either through human frailty or perversity, preclusion has been found wanting, yet the business has always been looked upon as a definite source of evil to the public, rigidly to be controlled in the interest of the general welfare. Moreover, it is well known that convictions for the violation of laws and regulations are often difficult although the public authorities may...