People ex rel. Einsfeld v. Murray

• Decision Date: 26 May 1896
• Citation: 44 N.E. 146,149 N.Y. 367
• Parties: PEOPLE ex rel. EINSFELD v. MURRAY et al., Commissioners of Excise.
• Court: New York Court of Appeals Court of Appeals

149 N.Y. 367

44 N.E. 146

PEOPLE ex rel. EINSFELD

v.MURRAY et al., Commissioners of Excise.

Court of Appeals of New York.

May 26, 1896.

Appeal from supreme court, appellate division, First department.

Certiorari on the relation of Fred C. Einsfeld, to Joseph Murray and others, commissioners of excise of New York City. From a judgment of the appellate division (38 N. Y. Supp. 909) affirming an order dismissing the writ, relator appeals. Affirmed.

Joseph H. Choate, Louis Marshall, and Samuel Untermyer, for appellant.

T. E. Hancock, Atty. Gen., and Julius M. Mayer, for respondents.

ANDREWS, C. J.

The sole question involved in this appeal is the constitutionality of the act of the legislature, approved March 23, 1896,¹ entitled ‘An act in relation to the traffic in liquors and for the taxation and regulation of the same and to provide for local option.’ The constitutionality of the act is assailed on three principal grounds: (1) That it appropriates the public moneys or property of the state to private and local purposes, and, not having been passed by a two-thirds vote of the legislature, is void, under article 3, § 20, of the state constitution; (2) that section 11 of the act, which fixes the excise tax upon the business of trafficking in liquors, creates a classification of cities at variance with that created by article 12, § 2, of the constitution; (3) that the act is a special city law, as to each of the cities of the state, which, under article 12, § 2, of the constitution, was required to be submitted to the mayor, for acceptance or rejection, before final enactment. These questions are considered in the opinion of the appellate division of the First department, in the decision from which the appeal is taken. We concur in the conclusions reached, and can add but little to the very cogent and satisfactory opinion of Judge Patterson in the case. We shall, however, in view of the great public interest in the subject, make some observations upon the several questions, in the order in which they have been stated:

1. Article 3, § 20, of the constitution prescribes: ‘The assent of two-thirds of the members elected to each branch of the legislature shall be requisite to every bill appropriating the public moneys or property for local or private purposes.’ It is insisted that section 13 of the act of 1896, which provides that one-third of the revenues derived under the act, less the amount allowed for collecting the same, shall be paid to the treasurer of the state to the credit of the general fund, as a part of the general tax revenue of the state, and that the ‘remaining two-thirds thereof, less the amount allowed for collecting the same, shall belong to the town or city in which the traffic was carried on from which the revenues were received, and shall be paid by the county treasurer of such county and by the special deputy commissioners to the supervisor of such town or to the treasurer or fiscal officer of such city; and such revenues shall be appropriated and expended by such town or city in such manner as is now or may hereafter be provided by law for the appropriation and expenditure of sums received for excise licenses, or in such other manner as may hereafter be provided by law,’-is in contravention of this section of the constitution, as respects the disposition made by the act of two-thirds of the revenue to town and city purposes. This latter clause, it is insisted, is an appropriation of public money to local purposes, within this section of the constitution; and it being conceded that the act did not receive a two-thirds vote of the members of the legislature, if the claim is well founded the 13th section of the act, so far as relates to two-thirds of the revenues, is unconstitutional and void. The appropriation of this part of the excise tax revenues is, without doubt, for a local purpose, within article 3, § 20, of the constitution. The fact that the purpose for which an appropriation is made is public does not withdraw it from the inhibition of the section, if the purpose is also local. An act may be local, although public. Church, C. J., Kerrigan v. Force, 68 N. Y. 381;People v. Allen, 42 N. Y. 378. The crucial question, therefore, is whether the act of 1896 is, within the section, an appropriation of public moneys. This provision of the present constitution was in the constitution of 1821, and has ever since formed a part of the organic law of the state. Section 13 of the act of 1896, after fixing the rule of distribution of the excise taxes as between the state and the cities and towns, prescribes that the revenues received by the cities and towns shall be appropriated and expended for the purposes to which the excise moneys are applied under existing laws. The excise law of 1892, which was in force up to the passage of the act of 1896, under which all excise moneys were paid over to the several towns or cities in which licenses were granted, and in which the license moneys were received, declared, in substance, that the moneys should be applied towards defraying the expenses of local government therein. Laws 1892, c. 401, § 15. Under the act of 1896, which, in effect, incorporates into the thirteenth section this provision of the act of 1892, the same application is to be made of the excise taxes received by the cities and towns as was prescribed by the act of 1892 in respect to license fees collected under that act. Upon the point whether two-thirds of the traffic taxes imposed by the act of 1896, and which the thirteenth section declares shall belong to the town or city where the traffic is carried on, are public moneys, within article 3, § 20 of the constitution, it is important to notice that although this section has been, since 1821, a part of the constitution of the state, excise moneys collected during that whole period have been appropriated, under a general law of the state, exclusively to the localities where the licenses were granted, to be applied to diminish local taxation, or to some purpose of local charity. Indeed, this has been the uniform policy of the state, in respect of the disposition of excise moneys derived from the traffic in liquors, from the foundation of the state government. By the earliest excise law of the state (chapter 17, Laws 1779) the excise commissioners were directed to pay the excise moneys collected in each county to the county treasurer, to be applied towards defraying the contingent expenses of the county. The system of appointing commissioners of excise has not been uniform. Under the colonial act (chapter 54, Laws 1775) they were designated by name in each of the localities. The act of 1779 designated certain officials to act as commissioners. Since that time county boards of excise have been created, as under the act of 1857, and subsequently town and city boards were substituted. Under the county system the excise moneys were paid to the counties, and under the system of towm and city boards to the towns and cities, in which the licenses were issued. But notwithstanding many changes, from time to time, have been made in the details of the excise system, there has, for a century of the state government, and up to the act of 1896, been one uniform policy recognized by the legislature, namely, that moneys received for licenses for the liquor traffic should be paid over to the localities of the state in which the licenses were granted, to be applied to some object of local government or interest.

Under the former license laws, large sums have been collected annually in cities, villages, and towns. In a strict and accurate sense, they were public moneys. No exaction can be lawfully made of a citizen, by way of tax, impost, or excise, except under the authority of the legislature, and the product of such imposition is public money. But there is a well-settled distinction between the money of the state, and money levied under corporate powers conferred upon cities, villages, and towns for local and corporate purposes. In the latter case the money levied and collected is not the money of the state. It is the money of the town, city, or village in which, under the exercise of corporate powers, it was levied and collected, and to it the state has no title. People v. Ingersoll, 58 N. Y. 1;Shepherd's Fold v. Mayor, etc., 96 N. Y. 138. In every city of vilage charter the power of local taxation for municipal purposes is conferred, with authority to appropriate the money raised to purposes of local government. This, in a general sense, is an appropriation of public moneys to local purposes, but it has never been supposed that it was an appropriation within the meaning of article 3, § 20, of the constitution, so as to require a two-thirds vote to pass a bill granting a city or village charter. The former excise laws stood upon a different basis from the charter laws of cities and villages. They were general laws applicable to the whole state, establishing a system for the regulation of the traffic in liquors, varying in some respects in their application in cities and towns. The system was administered through boards of excise, sometimes, as we have seen, appointed directly by the legislature, but generally elected in towns, with jurisdiction to grant licenses in the town for which they were elected, and, in cities, appointed by local authorities. The excise commissioners, although locally elected or appointed, were state agencies for administering the excise system, and, like assessors, collectors, and highway commissioners, were independent public officers, exercising public powers, and charged with public duties specially prescribed by law. Lorillard v. Town of Monroe, 11 N. Y. 392;People v. Board, etc., of Esopus, 74 N. Y. 310. In granting licenses they were not exercising a jurisdiction as agents of the corporations within which they acted, for the granting of licenses for the traffic in liquor was not a power vested in towns,...