Midwest Messenger Ass'n v. Spire

• Decision Date: 19 September 1986
• Docket Number: No. 85-391,85-391
• Parties: , 78 A.L.R.4th 469 MIDWEST MESSENGER ASSOCIATION, an Unincorporated Association, Appellant, v. Robert M. SPIRE, Attorney General of the State of Nebraska, et al., Appellees.
• Court: Nebraska Supreme Court

Page 438

393 N.W.2d 438

223 Neb. 748, 78 A.L.R.4th 469

MIDWEST MESSENGER ASSOCIATION, an Unincorporated Association, Appellant, v. Robert M. SPIRE, Attorney General of the State of Nebraska, et al., Appellees.

No. 85-391.

Supreme Court of Nebraska.

Sept. 19, 1986.

Syllabus by the Court

1. Declaratory Judgments: Statutes. An action for a declaratory judgment is an appropriate remedy for determining the validity, construction, or interpretation of a statute.

2. Pleadings: Demurrer: Appeal and Error. In reviewing an order sustaining a general demurrer, we accept as true all facts which are well pled, together with the reasonable inferences of fact which may be drawn therefrom, but we do not accept as true the conclusions of the pleader.

3. Constitutional Law. Neither property rights nor contract rights are absolute.

4. Constitutional Law: Legislature: Statutes. The Legislature is empowered to regulate and restrict the right to contract to preserve and protect the public health, safety, or welfare of the citizens of this state.

5. States: Taxes. The state may utilize its police power to protect its sources of revenue and assure collection of taxes.

6. Constitutional Law: Statutes: Appeal and Error. In a facial challenge to the overbreadth and vagueness of a law, that is, a claim that the law is invalid in toto and therefore incapable of any valid application, a court's first task is to determine whether the enactment reaches a substantial amount of constitutionally protected conduct. If it does not, then the overbreadth challenge fails. The court then examines the facial vagueness challenge and, assuming the enactment implicates no constitutionally protected conduct, upholds the challenge only if the enactment is impermissibly vague in all its applications.

7. Statutes: Standing. To have standing to challenge a vague statute, one must not have engaged in conduct which is clearly proscribed by the statute, and cannot complain of the vagueness of the law as applied to the conduct of others.

8. Statutes. Statutory language should be given its plain and ordinary meaning, and where the words of a statute are plain, direct, and unambiguous, no interpretation is necessary to ascertain their meaning.

9. Constitutional Law: Statutes. Neb.Rev.Stat. § 2-1221 (Cum.Supp.1984) held constitutional.

Anthony S. Troia, Omaha, for appellant.

Robert M. Spire, Atty. Gen., and Mel Kammerlohr, Lincoln, for appellees.

KRIVOSHA, C.J., and BOSLAUGH, WHITE, HASTINGS, CAPORALE, SHANAHAN, and GRANT, JJ.

BOSLAUGH, Justice.

Midwest Messenger Association, an unincorporated association, commenced this action to obtain a declaratory judgment that Neb.Rev.Stat. § 2-1221 (Cum.Supp.1984) is unconstitutional and to enjoin the defendants from enforcing the statute. The defendants are the Attorney General of Nebraska, the county attorney of Douglas County, Nebraska, the sheriff of Douglas County, and the chief of police of the city of Omaha, Nebraska.

All of the defendants filed general demurrers to the petition, which were sustained. The plaintiff elected to stand on its petition, which was then dismissed. The plaintiff has appealed.

The plaintiff has assigned as error that (1) the trial court erred in sustaining the demurrer of the defendants and (2) the court erred in not granting the plaintiff the requested declaratory relief.

The petition alleged:

[T]he principal business of the Plaintiffs is, for a fee, to accept, transport and deliver money to purchase parimutuel tickets at licensed racetracks within and outside of the State of Nebraska for and on behalf of clients who are legally competent to purchase said tickets but who are unable to be personally present at said racetracks. That Plaintiffs have operated said businesses for the past six years.

Section 2-1221 provides:

Except as provided in section 2-1221.01, whoever directly or indirectly, accepts anything of value to be wagered or to be transmitted or delivered for wager in any parimutuel or certificate system of wagering on horseraces, or delivers anything of value which has been received outside of the enclosure of a racetrack holding a race meet licensed under Chapter 2, article 12, to be placed as wagers in the parimutuel pool or certificate system of wagering on horseracing within such enclosure shall be guilty of a Class II misdemeanor.

The plaintiff contends that § 2-1221 is unconstitutional because it (1) impairs the right of members of the appellant to freely contract with their clients, (2) is unconstitutionally vague and overbroad in violation of due process of law, and (3) denies equal protection of the law in violation of both the state and federal Constitutions.

An action for a declaratory judgment is an appropriate remedy for determining the validity, construction, or interpretation of a statute. Mullendore v. School Dist. No. 1, 223 Neb. p. 28, 388 N.W.2d 93 (1986); Meyerkorth v. State, 173 Neb. 889, 115 N.W.2d 585 (1962); Dill v. Hamilton, 137 Neb. 723, 291 N.W. 62 (1940).

In reviewing an order sustaining a general demurrer, "we are required to accept as true all the facts which are well pled, together with the proper and reasonable inferences of law and fact which may be drawn therefrom, but we do not accept as true the conclusions of the pleader." Reimer v. K N Energy, Inc., 223 Neb. p. 142, 146, 388 N.W.2d 479, 482-83 (1986). If liberal construction of a petition indicates that it states a cause of action against the defendant and in favor of the plaintiff, a demurrer thereto should be overruled. Dixon v. Reconciliation, Inc., 206 Neb. 45, 291 N.W.2d 230 (1980).

The first issue is whether, as alleged, § 2-1221 impairs the appellant's right to contract, in violation of the 14th amendment to the federal Constitution.

In Nebbia v. New York, 291 U.S. 502, 523, 54 S.Ct. 505, 510, 78 L.Ed. 940 (1934), the U.S. Supreme Court stated:

Under our form of government the use of property and the making of contracts are normally matters of private and not of public concern. The general rule is that both shall be free of governmental interference. But neither property rights nor contract rights are absolute; for government cannot exist if the citizen may at will use his property to the detriment of his fellows, or exercise his freedom of contract to work them harm. Equally fundamental with the private right is that of the public to regulate it in the common interest.

Clearly, the Legislature is empowered to regulate and restrict the right to contract to preserve and protect the public health, safety, or welfare of the citizens of this state. United States Brewers' Assn., Inc. v. State, 192 Neb. 328, 220 N.W.2d 544 (1974).

In considering the validity of a statute challenged as impairing the right to contract, we must determine if the statute does in fact bear some reasonable relationship to its proposed ends. United States Brewers' Assn., Inc., supra. See, also, Nebbia v. New York, supra.

Prior to its amendment in 1984, § 2-1221 prohibited the same activity when done for a fee. § 2-1221 (Reissue 1983).

In Pegasus of Omaha, Inc. v. State, 203 Neb. 755, 280 N.W.2d 64 (1979), § 2-1221 as it read prior to the 1984 amendment was held to be constitutional against allegations that it deprived the plaintiff messenger service of its beneficial and lawful business without due process of law. At the heart of the plaintiff's argument in that case was the contention that while its services were subject to regulation, the Legislature was without power to absolutely prohibit an otherwise lawful occupation. Recognizing that article III, § 24, of the Nebraska Constitution empowered the Legislature to enact laws to license and regulate wagering on horseraces, we concluded that "[t]he activity of Pegasus is so intertwined with gambling that, under its constitutional power to regulate, the Legislature may ban messenger services operated for a fee from accepting bets and conveying the bets to a licensed racetrack." Pegasus of Omaha, Inc., supra at 759, 280 N.W.2d at 67.

As support for the decision in Pegasus, we relied on Finish Line Express, Inc. v. City of Chicago, 72 Ill.2d 131, 19 Ill.Dec. 626, 379 N.E.2d 290 (1978). In that case the Illinois Supreme Court upheld the validity of a statute nearly identical to § 2-1221 (Reissue 1983). The Finish Line court concluded that the statute was a proper exercise of the plenary police power to regulate gaming activity because of a long list of reported problems with the messenger services, including booking of bets, failure to pay off winners, involvement of organized crime, and reduced track attendance and betting, resulting in lost revenue to the state.

Similarly, in Nebraska Messenger Services Ass'n v. Thone, 478 F.Supp. 1036 (D.Neb.1979), aff'd 611 F.2d 250 (8th Cir.1979), § 2-1221 (Cum.Supp.1978), substantially the same statute challenged in Pegasus, supra, was upheld against due process and equal protection arguments. In concluding that the statute was reasonably related to legitimate state ends, the federal district court stated at 1038:

No one would question that the State of Nebraska has the power to regulate gambling in the interest of the public health, safety, and general welfare. Although the messenger services may not be gambling per se, such businesses are closely intertwined with gambling. Due to this close relationship, the Nebraska Unicameral could reasonably conclude that the public could only be protected from some of the evils of gambling by abolishing messenger services. For example, the Legislature may have reasoned that messenger services increase the risk of illegal bookmaking.

Section 2-1221 (Cum.Supp.1984), now in effect, differs from the statute reviewed in Pegasus, supra, and Nebraska Messenger Services Ass'n, supra, in the omission of the "for a fee" language. This change was made in response to the messenger services' policy changes following enactment of the original statute in 1977....