Nocera Bros. Liquor Mart, Inc. v. Liquor Control Hearing Bd.

• Decision Date: 25 November 1953
• Docket Number: Nos. 1037,1038,s. 1037
• Citation: 100 A.2d 652,81 R.I. 186
• Parties: NOCERA BROS. LIQUOR MART, Inc. v. LIQUOR CONTROL HEARING BOARD et al. (two cases). M. P.
• Court: Rhode Island Supreme Court

Page 652

100 A.2d 652

81 R.I. 186

NOCERA BROS. LIQUOR MART, Inc. v. LIQUOR CONTROL HEARING BOARD et al. (two cases).

M. P. Nos. 1037, 1038.

Supreme Court of Rhode Island.

Nov. 25, 1953.

Coffey, Ward, Hoban & McGovern, John G. Coffey, Providence, for petitioner.

William E. Powers, Atty. Gen., Archie Smith, Asst. Atty. Gen., Providence, for respondent board.

BAKER, Justice.

These two petitions for certiorari were filed under the provisions of public laws 1940, chapter 821, § 5, which amended public laws 1939, chap. 660, by adding thereto section 129. This amendment will hereafter be referred to as section 128. The cases were heard together and seek to have this court review and quash the decision made by the liquor control hearing board, sometimes called the board, after it had heard appeals from two orders of the acting liquor control administrator. These orders related to the fixing by him of minimum prices, both wholesale and retail, for the sale of various liquors in this state. The writs were issued as prayed and in response thereto the pertinent records were duly certified by the board which is the real respondent.

The order of the administrator fixing the minimum wholesale price to be charged for certain liquors was by way of amendment to rule No. 52, and the order fixing the minimum retail price of such liquors was by the establishment of rule No. 67 of the department of business regulation. Both rules were approved by the director of said department and were to become effective December 22, 1952. From the issuance of these orders, the petitioner, a corporation holding a class A package store license, appealed to the board. After a hearing the board denied and dismissed the appeal in respect to rule 52, as it found no credible evidence that the provisions thereof were arbitrary or unreasonable, and denied and dismissed petitioner's appeal as to rule 67 on the ground that the board did not have jurisdiction to hear such appeal. For the sake of clarity the questions growing out of the making of these two rules will be discussed separately.

In the instant petitions the determinative question raised regarding rule 67 is procedural in nature, namely, whether an appeal to the board lies from the administrator's order. The parties herein have presented their opposing views on that issue, and an examination of the pertinent statutes is necessary to decide it. Since such statutes have from time to time been amended, the ultimate intent of the legislature in certain respects is not always easily ascertainable. However, it is clear that the power to fix the retail price of certain liquors on a stated basis was given the division of intoxicating beverages (now suceeded by the administrator) under the provisions of P.L.1941, chapter 1038, amending general laws 1938, chap. 164, § 6. The language used in chapter 1038 reads as follows: 'It [the division of intoxicating beverages] shall have the power to fix on a cost plus percentage mark-up basis the wholesale and retail prices of all such commodities except malt beverages to be sold within this state or to be imported or brought into the state or exported therefrom and to raise or lower such prices in whole or in part from time to time.'

That chapter contains no express right of appeal from such price fixing. An appeal from decisions and orders made in the administration of the provisions of G.L.1938, title XX, as amended, is provided for by P.L.1940, chap. 821, § 129. It is therein set out that the right of appeal to the board shall exist in certain specific cases 'and not otherwise'. Included in such cases are the following: '(3) where such decision or order establishes a rule or regulation in accordance with the provisions of section 5 of chapter 164 of the general laws, as amended, * * * (5) where such decision or order fixes, raises or lowers the wholesale price of any beverage.'

The petitioner, however, relies on the above-quoted paragraph (3) of that section as the ground for its right to appeal. In answer thereto respondent contends that G.L.1938, chap. 164, § 5, as amended by P.L.1940, chap. 814, § 8, relates only to the issuing of licenses for the sale of liquor in such form as shall be prescribed by the department of business regulation; that the licenses shall be held under such rules and regulations as said department shall impose, establish and authorize'; and that such rules and regulations have nothing to do with the matter of price fixing. It further urges that the so-called rule or order in question here was made under the specific power given the administrator by § 6 of said chap. 164, as amended, to fix the retail price of certain liquors, a matter which is not in any manner included in § 5; that the rules, regulations and orders now in question were not made under the authority of § 5 as amended; that paragraph (3) hereinbefore set out has no present application; and that petitioner cannot base its alleged right of appeal thereon.

After considering the above statutes and giving each of them reasonable effect, we are of the opinion that the position taken by respondent herein is generally sound. Under the existing statutes the grant of authority to fix retail prices was added by the amendment to § 6 and not by the amendment to § 5 of chap. 164. When such power to fix retail prices was granted by P.L.1941, chap. 1038, the legislature did not then amend P.L.1940, chap. 821, § 129, so as to add the right to appeal from a rule or order fixing prices at retail. Such an appeal was then restricted to orders fixing wholesale prices. This omission is significant. At least in the circumstances we should not write such an amendment into the statute. If intended, that is a legislative function. The decision of the board that petitioner had no such right of appeal from the establishment of rule 67 was therefore without error, and we do not find any question properly before us relating to the validity of such rule.

No procedural question is raised by the parties concerning the taking and pressing of petitioner's appeal from the establishment of rule 52, which concerns the fixing of minimum prices for the sale of certain liquors at wholesale. The provision of P.L.1940, chap. 821, § 129, under which the instant petitions for certiorari were filed, limits the scope 'to review any questions of law involved.' As to rule 52 petitioner first argues that it was established contrary to law. We do not agree with that contention. In our opinion although the rule stated that it was promulgated under G.L.1938, chap. 164, § 5, as amended, the authority to fix prices is actually conferred under § 6 of that chapter as amended.

The rule was entitled 'Department Of Business Regulation Liquor Control Administrator' and was signed by that official. The power to fix wholesale prices of liquors, as we have stated, was given to the administrator as a member of the department of business regulation under § 6 as amended. In our judgment that power by reasonable and necessary implication carried with it the authority to make rules, regulations, orders and decisions to give effect to the power to fix such prices. Section 5 of that chapter did not contemplate rules and regulations to implement the power of price fixing but dealt merely with matters relating generally to the issuing and control of liquor licenses.

The petitioner next contends that the promulgation of rule 52 was a legislative action taken by an administrative official in violation of article III and of sections 1 and 2 of article IV of the constitution of this state. Article III provides that the powers of the government shall be distributed into three departments: the legislative, executive and judicial. Sections 1 and 2 of article IV deal with the enacting of laws by the general assembly and what the legislative power under the constitution embraces.

This court has had occasion to pass upon the constitutionality of statutes which regulate the conduct of a business. Speaking broadly this requires the exercise of the legislative power, which ordinarily cannot be delegated in such an instance. However, it is recognized that in many cases the legislature may and often must leave to administrative officers or agencies the making and carrying out of details connected with the administration of such a regulatory statute, and that the delegation of duties of that nature to an administrative body or officer is not necessarily a ground for holding the statute...