Davis v. Query

• Citation: 39 S.E.2d 117,209 S.C. 41
• Decision Date: 26 July 1946
• Docket Number: 15859.
• Parties: DAVIS v. QUERY et al.
• Court: South Carolina Supreme Court

39 S.E.2d 117

209 S.C. 41

DAVIS v. QUERY et al.

No. 15859.

Supreme Court of South Carolina

July 26, 1946

Wyche, Burgess & Wofford, of Greenville, for petitioner.

John M. Daniel, Atty. Gen., and M. J. Hough, T. C. Callison, and Claude K. Wingate, Asst. Attys. Gen., for respondents.

STUKES Justice.

This proceeding in the original jurisdiction, by permission of the court, was brought by petitioner, a licensed retail liquor dealer under The Alcoholic Beverage Control Act of 1945, 44 Stat. at Large, p. 337, for injunction against the South Carolina Tax Commission, its officers and agents, from enforcement of certain recently promulgated rules and regulations affecting that traffic.

The case was placed upon the roster for the June term upon a rule to show cause, duly issued. why the respondents should not be temporarily restrained in the manner sought, pending hearing of the controversy upon the merits. The commission made return which was printed along with the petition and both contestants were ably represented by counsel at the oral arguments, after the filing of printed briefs, and they then agreed that the matter be heard and considered on the merits, which course is followed.

The petition concerns itself with a description of the large retail business in the sale of intoxicants which petitioner has built up in the city of Greenville over a period of years and the resulting 'overhead' expenses. The third paragraph of the petition is quoted, as follows:

'That the said respondents, acting as the South Carolina Tax Commission, have been given under the law the powers and duties to pass reasonable regulations to regulate the manufacture, sale, possession, transportation and use of alcoholic liquors; the power to grant, suspend and revoke licenses engaged in the manufacture, handling and the sale of alcoholic liquors; to collect the license tax and to prohibit violations of the law with reference to the manufacture sale, possession and transportation of alcoholic liquors. That pursuant to such authority and power the said Tax Commission from time to time have made such reasonable regulations not inconsistent with the Act regulating the manufacture, sale, possession and transportation of alcoholic liquors for the purpose of carrying out the provision of the said Act and to prevent the illegal manufacture, bottling sale, distribution and transportation of alcoholic liquors.'

Thereafter the petition contains full copies of three regulations of the Commission which were promulgated on April 18, 1946 effective May 1, 1946, which petitioner alleges are in excess of the statutory authority of the Commission and on the contrary are unreasonable, capricious, unlawful and in restraint of trade, and the contention is made that 'equitable distribution' of alcoholic liquors does not contemplate, in the title or body of the Act under review, equitable distribution among the counties, between wholesalers and retailers; and that the act is devoid of a standard whereby equitable distribution shall be measured and the contention is repeated with respect to the so-called rationing of whisky to individuals; and that under the regulations petitioner would be unable to continue to purchase liquors in such quantities as to conduct his usual business.

The return of the Commission asserts the reasonableness of the regulations to bring about an equitable distribution of alcoholic liquors in the state and that the very fact of the size of petitioner's business, in comparison with others in the County of Greenville, convinced the members of the Commission of the necessity of the regulations in order to carry out the legislative mandate to effect an equitable distribution; and there is a denial that the Commission has exceeded its authority, derived from the Legislature, in the promulgation and enforcement of the regulations, which are alleged to be reasonable and proper. The return then contains the following: 'The petitioner may not be able to purchase from the wholesalers the large quantities of liquor which he has heretofore purchased, but will be required to accept his proportionate share of such liquors as are available, and permit the other retail dealers within the State to secure a fair portion of the available liquors, and thus an equitable distribution of available liquors in this State will be effected. Respondents deny that all of the seven hundred retail stores in this State will be adversely affected by the enforcement of the regulations herein-above referred to, and allege that such retail dealers within the State who have in the past been unable to procure a fair allotment of such alcoholic liquors will no longer be discriminated against in favor of the few who have by some means been able to procure a larger proportion of such liquors than they were equitably entitled to receive. The respondents admit that the regulations complained of are in full force and effect, but deny that any emergency exists except such emergency as may have been occasioned by the scarcity of alcoholic beverages and the lack of sufficient quantities of same to meet the consumer demand within the State.'

The pleadings have not been fully stated, but the salient points have been set forth sufficiently to understand the questions presented, which respondents accurately say are as follows:

(1) Is the title to the Act of 1945 sufficiently broad to cover the subject dealt with in the body of the Act?

(2) Does the Alcoholic Beverage Control Act of 1945, considering the title together with the contents of the Act, authorize the South Carolina Tax Commission to adopt the regulations set out in the petition?

(3) If the Act authorizes the adoption of such regulations does such authorization amount to a delegation of legislative authority to the South Carolina Tax Commission?

(4) If the Legislature, under the Constitution, may direct the Tax Commission to adopt reasonable regulations for the purpose of effecting an equitable distribution of alcoholic liquors in the State, are the regulations so adopted reasonable and equitable?

However, the questions will not be dealt with in the order thus stated in the brief of respondents, or even separately, but they will be completely disposed of by full consideration of all of the points urged in petitioner's written and oral arguments. Without stating them specifically, petitioner touches on respondent's questions in his brief, but the gravamen of his position is that the attempt of the Legislature to vest the tax commission with authority to adopt and enforce rules and regulations which will effect an equitable distribution of intoxicating liquors in the state is unconstitutional for its failure to observe the traditional separation of governmental powers, and he cites article III, sec. 1, of the Constitution of 1895, wherein the legislative power of the state is vested in the General Assembly; and he contends that the Act of 1945, in the aspect under review, is an unconstitutional attempt by the General Assembly to delegate its legislative power.

This is a perplexing question of constitutional law which has given the courts no end of trouble, particularly during recent years, when the complexities of government appear to constantly increase. The subject is excellently and exhaustively treated in an annotation in 79 L.Ed. 474, appended to report of the case of Panama Refining Co. v. Ryan, 293 U.S. 388, 55 S.Ct. 241, 247, 79 L.Ed. 446. In that case the Supreme Court found invalid an executive order, No. 6199, 15 U.S.C.A. § 709 note, which it held to be in the nature of legislation and its attempted authorization, by the National Industrial Recovery Act of Congress, unconstitutional. The opinion of the court was by Chief Justice Hughes and Justice Cardozo filed an interesting dissenting opinion. The order attempted to prohibit the shipment in interstate commerce of 'hot' oil, that produced or withdrawn from storage in violation of state laws or regulations, and a point of the decision is that the statute under which the order was promulgated did not declare a policy of prohibition of such commerce, indeed it contained a declaration of policy against the obstruction of the free flow of commerce; but the ratio decidendi is well summarized in the judgment, as follows: 'Congress left the matter to the President without standard or rule, to be dealt with as he pleased.' The leading opinion is an extensive one and in it there were reviewed many of the former decisions of that court in which orders and regulations of executive officers and boards were upheld when they accorded with a policy formerly declared by Congress and accompanied by a standard in the authorizing acts. There is no need to attempt another review of the decisions here but digests of two of them will be reproduced from the opinion for they closely approach our present problem.

In Buttfield v. Stranahan, 192 U.S. 470, 496, 48 L.Ed. 525, 535, 24 S.Ct. 349, 355, the Act of March 2, 1897, 29 Stat. at L. 604, 605, chap. 358, 21 U.S.C.A. § 41, was upheld, which authorized the Secretary of the Treasury, upon the recommendation of a board of experts, to 'establish uniform standards of purity, quality, and fitness for the consumption of all kinds of teas imported into the United States.' The Court construed the statute as expressing 'the purpose to exclude the lowest grades of tea, whether demonstrably of inferior purity, or unfit for consumption, or presumably so because of their inferior quality.' The Congress, the Court said, thus fixed 'a primary standard' and committed to the Secretary of Treasury 'the mere executive duty to effectuate the legislative policy declared in the statute.'

The provisions of the Radio Act of (February 23,) 1927, 44...