Park Benziger & Co., Inc. v. Southern Wine & Spirits, Inc.
| Decision Date | 11 December 1980 |
| Docket Number | No. 58916,58916 |
| Citation | 391 So.2d 681 |
| Parties | PARK BENZIGER & CO., INC., Appellant, v. SOUTHERN WINE & SPIRITS, INC., Appellee. |
| Court | Florida Supreme Court |
Angus M. Stephens, Jr., Coral Gables, for appellant.
Thomas E. Lee, Jr. of Lee, Murphy & Coe, Miami, for appellee.
John M. Johnston and Robert G. Haile, Jr. of White & Case, Palm Beach, for Distilled
Spirits Counsel of the United States, Inc., amicus curiae.
In an action for declaratory relief brought by Park Benziger & Co., the trial judge passed upon the constitutionality of section 565.095, Florida Statutes, which deals with the distribution and sale of intoxicating liquor. We have jurisdiction. Art. V, § 3(b)(1), Fla.Const. (1972).
The issues sought to be determined are (1) whether the statute is applicable to distributor contracts in existence on the statute's effective date, (2) whether a manufacturer or its representative may withdraw a particular brand or label of spirituous or vinous beverage from a distributor without going through the procedure prescribed by section 565.095(5), 1 and (3) whether such a manufacturer may appoint an additional distributor or distributors when that manufacturer has an existing distributor without first terminating the existing distributor in accordance with the provisions of section 565.095.
We hold that the statute cannot be applied to distributor contracts in existence prior to July 1, 1978, and decline to answer the other questions.
Acting under an oral contract with Park Benziger & Co., Southern Wine and Spirits had been the exclusive Florida distributor of a Scottish whiskey labeled "Old Rarity" for approximately eight years prior to July 1, 1978. Since no termination date for this contract existed, it was terminable at will by either party. § 672.309, Fla.Stat.
After July 1, 1978, Park Benziger, dissatisfied with the sales level of Old Rarity, asked Southern either to give up Old Rarity or to allow Park Benziger to appoint a second distributor in addition to Southern. Southern objected and claimed that section 565.095(5) precludes the supplier from doing either of those things. Unsure of its position under the statute, Park Benziger sued in circuit court for declaratory relief. The trial judge ruled that the statute is constitutional, that it applied to the parties to this action, and that the manufacturer cannot appoint an additional distributor without going through the procedure set forth in the act. In doing so he did not directly address the question of whether the act impermissibly impaired the terms of contracts in existence prior to the statute's effective date.
The twenty-first amendment to the United States Constitution recognizes the authority of a state to regulate the sale and distribution of liquor within its borders. A state may determine the conditions upon which liquor can come into its territory and what will be done with it after it gets there. United States v. Frankfort Distilleries, Inc., 324 U.S. 293, 65 S.Ct. 661, 89 L.Ed. 951 (1945). In upholding New York's Price Affirmation Act () the United States Supreme Court affirmed this authority and recognized the state's power in this regard. Joseph E. Seagram & Sons, Inc. v. Hostetter, 384 U.S. 35, 86 S.Ct. 1254, 16 L.Ed.2d 336 (1966). In California v. LaRue, 409 U.S. 109, 93 S.Ct. 390, 34 L.Ed.2d 342 (1972), that Court upheld the prohibition of the sale of alcohol by the drink in establishments that permitted certain types of dancing and nudity.
But the fact that intoxicating beverages is the subject matter of legislation does not automatically make such legislation valid, and such an act must fall if it violates a constitutional prohibition. In Craig v. Boren, 429 U.S 190, 97 S.Ct. 451, 50 L.Ed.2d 397 (1976), the Court struck down an Oklahoma law setting the drinking age for males at 21 and for females at 18 as a violation of equal protection. In Hostetter v. Idlewild Bon Voyage Liquor Corp., 377 U.S. 324, 84 S.Ct. 1293, 12 L.Ed.2d 350 (1964), the Supreme Court held that New York's liquor licensing law did not extend to a company headquartered at the New York Port Authority whose sale of liquor commenced outside the continental limits of the United States. This Court in Division of Beverage, Dep't. of Business Regulation v. Bonanni Ship Supply, Inc., 356 So.2d 308 (Fla.1978), held that a statute regulating export activity of "in bond" liquor was subject to a previous federal regulatory scheme and was, therefore, in violation of the commerce clause of the United States Constitution.
Both the United States and the Florida Constitutions provide that no law impairing the obligation of contracts shall be passed. 2 Exceptions have been made to the strict application of these provisions when there was an overriding necessity for the state to exercise its police powers, but virtually no degree of contract impairment has been tolerated in this state. Yamaha Parts Distributors, Inc. v. Ehrman, 316 So.2d 557 (Fla.1975).
We are unable to discern in this statute a public purpose of sufficient need to authorize an impairment of existing contractual agreements. The trial judge opined that its purpose was the prevention of the "tied-house evil". 3 This is not clear from the statute itself nor from any history of its enactment, but if this were the purpose, that objective does not create sufficient need for the exercise of police power in conflict with these parties' constitutional rights. 4
In Pomponio v. Claridge of Pompano Condominium, Inc., 378 So.2d 774 (Fla.1979), we discussed the analysis to be performed in deciding whether a statute unconstitutionally impairs the obligation of a contract:
To determine how much impairment is tolerable, we must weigh the degree to which a party's contract rights are statutorily impaired against both the source of authority under which the state purports to alter the contractual relationship and the evil which it seeks to remedy. Obviously, this becomes a balancing process to determine whether the nature and extent of the impairment is constitutionally tolerable in light of the importance of the state's objective, or whether it unreasonably intrudes into the...
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