Pickerill v. Schott

Decision Date18 December 1951
Citation55 So.2d 716
PartiesPICKERILL et al. v. SCHOTT, Director of the Beverage Department.
CourtFlorida Supreme Court

Caldwell, Parker, Foster & Wigginton, Tallahassee, and Arnold, Matheny & Butt, Orlando, for appellants.

Lawrence Renfroe, Tallahassee, W. J. Sears and J. Turner Butler, Jacksonville, for appellee.

MATHEWS, Justice.

On October 9th, 1951, the appellants, who are retail liquor dealers, purchased on credit $640.74 of merchandise from McKesson-Robbins, Inc., a wholesale liquor dealer of Jacksonville. The appellants did not pay for this merchandise within the time required by Section 561.42, Florida Statutes 1949, F.S.A. It is unnecessary to encumber this record by quoting this Statute in full. It is known as the 'Tied House Evil' law. It prohibits manufacturers, wholesalers and distributors from having any financial interest in retailers, directly or indirectly, and also limits the extension of credit to retailers to ten days after the calendar week in which the sale is made. If payment is not made as required, the law makes it the duty of distributors to report the delinquency to the Beverage Department within three days. This department is then required to notify the delinquent retailor of such notice and if he fails to pay, or show cause before the Beverage Director why same should not be paid, then further sales to him are prohibited.

The law in question provides that good and sufficient cause to prevent such action by the Beverage Department may be made by showing payment, failure of consideration, or any other defense which would be considered sufficient in a common law action. The retailer is allowed five days within which to show such cause in writing and request a hearing. During this period he is restricted to cash sales. If he fails to show cause, all further sales, both cash and credit, are prohibited.

The Act makes ample provision for review of the decision of the Beverage Department where good and sufficient cause within the limits of the Statute is attempted to be shown and the ruling is adverse.

If a review as provided by the Statute is sought within five days after the hearing provided for by the Statute then prohibition of sales is suspended until the review or appeal is disposed of.

There is no dispute as to the facts. The appellants were indebted for liquors purchased and they were not paid for within the time required by law. There was no contention that they had any defense to the payment for the liquor; such as, failure of consideration, or they had been paid for, or any other defense which would be considered sufficient in a common law action. Their sole contention is that the law is unconstitutional and within the five days after being notified of delinquency they advised the Beverage Department that the credit law was unconstitutional and requested the Director to give them a hearing on that question. The Director denied the hearing because he had no jurisdiction to hold a hearing unless there was some defense to the payment of the claim within the limits of the Statute.

The appellants then filed suit for temporary and permanent injunction in Orange County attacking the constitutionality of the Act. The Chancellor denied the prayers for the injunctions, granted a motion to dismiss the bill and upheld the constitutionality of the Act. An appeal was taken from this order.

Pending the appeal, appellants made application to this Court for a Constitutional Writ to stay the enforcement of the Act and the orders concerning sales pending the appeal.

This Court has heretofore denied the application for Constitutional Writ. See Supreme Court Rule 33, 30 F.S.A., Wingate v. Mach, 114 Fla. 380, 154 So. 192. State ex rel. Watson v. Lee, 150 Fla. 496, 8 So.2d 19.

On appeal the appellants contend that the Statute in question; that is, Section 561.42, known as the 'Tied House Evil' law is unconstitutional in that it violates Sections 1 and 2 of the Declaration of Rights of the Constitution of the State of Florida, F.S.A., and the Fourteenth Amendment to the Constitution of the United States because: (1) it is arbitrary and discriminatory within a class designed to bring about an unjust personal advantage to the wholesalers in the liquor industry, as distinguished from a general public advantage; (2) it denies due process of law because there is no provision for a hearing of any kind before the appellee is required under the Statute to deprive the appellants of their business credit; (3) the orders of the appellee directed to the appellants and wholesalers prohibiting sales as provided for by the Statute constitute a violation of the right to contract and engage in business and are not reasonable restraints in the public interest, and are not reasonable exercise of the police power; and (4) that the the Act fails to provide for the right of review by the Courts in the event that the appellee is denied a hearing on the ground that the appellants failed to show in their request for a hearing a good and sufficient cause (the appellants assigned no cause within the limits of the Statute but asked for a hearing from the appellee on the question of the constitutionality of the Act).

The Chancellor answered all of these questions contrary to the contention of the appellants. The Chancellor was correct.

As all of the questions are so interwoven and connected, it is rather difficult to treat them separately. This Court has repeatedly held that a retail liquor license authorizing the purchase for sale and the selling of liquors is merely a privilege granted by the State pursuant to law under restricted terms, conditions and regulations imposed by the State because of injurious effect of the use of intoxicants on the health and general welfare.

In 48 C.J.S., Intoxicating Liquors, § 197, page 329, with reference to the 'Tied House Evil', the author states: 'Effect has been accorded to federal and state statutes making it unlawful for manufacturers or wholesalers to have an interest in retail liquor stores, to loan money or extend credit, for a period in excess of thirty days, to a retailer, or to offer or give a bonus, premium, or compensation to an officer, employee, or representative of the buyer to induce the buyer to purchase from the seller to the exclusion of goods of competitors; or to statutes containing other provisions of like character respecting business relations between retailers and manufacturers or wholesalers. Statutes of this nature are aimed at the evil known as the 'tied house'; and their purpose is to prevent the integration of retail and wholesale outlets and to remove the retail dealer in intoxicating liquors from financial or business obligations to the wholesaler, with the exception of ordinary commercial credit for liquors sold.'

It is significant to note that the original Section 561.42, which was Section 4 of Chapter 16,774, Laws of 1935, was the original 'Tied House Evil' law in this state. The purpose of this Act was to prevent monopoly or control by manufacturers or distributors of the retail outlets for the sale of intoxicating liquors. The original Act prohibited such manufacturers and distributors from having any 'financial interest, directly or indirectly, in the establishment or business of any vendor licensed under the beverage law',...

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    • United States
    • New Jersey Supreme Court
    • November 16, 1964
    ...under the due process and equal protection clauses. See Weisberg v. Taylor, supra, 409 Ill. 384, 100 N.E.2d 748; Pickerill v. Schott, 55 So.2d 716 (Fla.Sup.Ct.1951), cert. denied, 344 U.S. 815, 73 S.Ct. 9, 97 L.Ed. 634 (1952); Sepe v. Daneker, 76 R.I. 160, 68 A.2d 101 (1949); Annot.: 136 A.......
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    ...reduced rents, and free equipment, employing their staff, and other means. See Actmedia, 830 F.2d at 960 ; see also Pickerill v. Schott, 55 So.2d 716, 719 (Fla.Sup.Ct.1951). Lawmakers in Congress, California, and other states blamed "the industry structure that tied-house arrangements creat......
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    • Texas Supreme Court
    • April 28, 2017
    ...the purpose of the statute is to prevent "financial control of the retailer by the wholesaler.") (emphasis added); Pickerill v. Schott, 55 So.2d 716, 718 (Fla. 1951) (holding the purpose of Florida's "Tied House Evil Act" "was to prevent monopoly or control by manufacturers or distributors ......
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    • November 8, 1965
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