Duncan v. A.R. Krull Company

• Decision Date: 30 June 1941
• Docket Number: Civil 4358
• Citation: 57 Ariz. 472,114 P.2d 888
• Parties: JOHN A. DUNCAN, as Superintendent of the Department of Liquor Licenses and Control of the State of Arizona, Appellant, v. A.R. KRULL COMPANY, Appellee
• Court: Arizona Supreme Court

114 P.2d 888

57 Ariz. 472

JOHN A. DUNCAN, as Superintendent of the Department of Liquor Licenses and Control of the State of Arizona, Appellant, v. A.R. KRULL COMPANY, Appellee

Civil No. 4358

Supreme Court of Arizona

June 30, 1941

APPEAL from a judgment of the Superior Court of the County of Maricopa. G. A. Rodgers, Judge. Judgment affirmed.

Mr. Joe Conway, Attorney General, and Mr. Edward P. Cline, Assistant Attorney General, for Appellant. Mr. Riney B. Salmon and Mr J. A. Riggins, Jr., for Appellee.

OPINION

ROSS, J.

The Superintendent of the Department of Liquor Licenses and Control for the State, on June 26, 1939, promulgated "Regulation No. 36" reading as follows:

"On and after September 1, 1939, no wholesaler or retailer shall sell or otherwise dispose of any beer in the original container, including bottle and can having a capacity of less than eleven (11) fluid ounces."

On June 29, 1940, the A. R. Krull Company, an Arizona corporation engaged in selling and distributing beer and other liquors at wholesale throughout Arizona, brought this action against John A.Duncan, as superintendent of such department, to secure a declaratory judgment as to whether the superintendent is, by the provisions of the law creating the Department of Liquor Licenses and Control (sections 72-101 to 72-117, Arizona Code 1939), given the right and power to issue such regulation fixing the minimum fluid content of containers of beer.

Issues were formed and, motion for judgment on the pleadings having been made by plaintiff, the court declared its judgment to be that the superintendent, in promulgating such regulation, exceeded his powers.

From such judgment, the superintendent has appealed.

It appears from the complaint that plaintiff has in stock beer, in containers of eight ounces, which it desires to sell and distribute to the trade but refrains from so doing so long as the legality of the foregoing regulation remains undetermined.

The pertinent provisions of the law are to be found in the following sections:

"72-103. Powers and duties of superintendent. -- (a) The superintendent of liquor licenses and control shall administer and enforce the provisions of this act.

"(b) The superintendent shall have power:

"1. To prescribe necessary rules and regulations: la. for carrying out the provisions of this act; 1b. for the proper conduct of the business to be carried on under each specific type of spirituous liquor license; 1c. to enable and assist state officials to collect all taxes levied or imposed in connection with spirituous liquors, and, 1d. to procure full compliance by licensees, in conduct of their business, with all laws;..."

"72-113. Unlawful acts.

"(b) It shall be unlawful:

"2. For any off-sale retailer to sell spirituous liquors except in the original container, to permit any spirituous liquor to be consumed on his premises, or to sell spirituous liquor in any container having a capacity of less than eight (8) ounces...."

The Attorney General contends the terms of the act confer on the superintendent the power to fix the minimum contents of liquor containers. The question for decision is whether this contention is correct. Under the act, beer is classified as a "spirituous liquor." Section 72-101. The act does not specifically provide the size of liquor containers but under section 72-113 (b) 2, supra, off-sale liquor retailers commit an unlawful act if they sell spirituous liquors (1) except in original containers or (2) in containers of a capacity less than eight ounces or (3) if they permit the liquor to be consumed on the sellers' premises. It nowhere fixes the capacity of containers for the wholesaler. But, since no sales of liquor in containers of less than eight ounces would be legal, the wholesaler of necessity would put his product in containers of a capacity of eight ounces or more. The practical effect of limiting the minimum size of containers to eight ounces by the off-sale retailer was to fix the wholesale size of containers at eight ounces or more.

Under the act, whether it be whiskey, brandy, rum, gin, wine, ale, beer, or any of the liquors mentioned, containers for liquor sold in original form must be of a capacity of not less than eight ounces to be lawful. That is the declaration of the lawmaking body, a legislative policy, and the question is, did the body announcing such a policy, by delegating to the superintendent the power to prescribe necessary rules and regulations for carrying out the provisions of the act, intend to authorize such administrative officer to fix the size of containers of beer at not less than eleven fluid ounces.

Rules and regulations by an administrative or executive officer or body are always subordinate to the terms of the statute and in aid of the enforcement of its provisions. If containers of less capacity than eight ounces are forbidden, it follows, we think, that it was the intention of the legislature that containers of the size of eight ounces or more are lawful.

"The general principle governing the conditions under which the power to make rules and regulations may be delegated has been stated as follows: A legislature, in enacting a law complete in itself and designed to accomplish the regulation of particular matters falling within its jurisdiction, may expressly authorize an administrative commission, within definite valid limits, to provide rules and regulations for the complete operation and enforcement of the law within its expressed general purpose. So long as a policy is laid down and a standard is established by a statute, no unconstitutional delegation of legislative power is involved in leaving to selected instrumentalities both the making of subordinate rules within prescribed limits and the determination of facts to which the policy as declared by the legislature is to apply...." 11 Am. Jur. 955, sec. 240.

Before the superintendent could make a regulation such as No. 36 it should appear that such regulation has for its purpose the carrying into effect of some provision of the act. The size of the liquor container is not a subject committed by the act to the superintendent. The provisions of the act are, in general, as follows:

Section 72-101 consists of definitions; 72-102 creates the department of liquor licenses and control and provides for the office of superintendent of such department; 72-103 which we have heretofore quoted in part, prescribes the powers of such superintendent; 72-104 provides that anyone who deals in spirituous liquors shall procure a license to do so from the superintendent, with exceptions such as drug...