Regal Oil Co. v. State

• Decision Date: 06 December 1939
• Docket Number: No. 240.,240.
• Citation: 123 N.J.L. 456,10 A.2d 495
• Parties: REGAL OIL CO. v. STATE.
• Court: New Jersey Supreme Court

10 A.2d 495

123 N.J.L. 456

REGAL OIL CO.

v. STATE.

No. 240.

Supreme Court of New Jersey.

Dec. 6, 1939.

The Regal Oil Company, a corporation, was convicted in a summary proceeding of unlawfully and illegally using and displaying a sign relating to the price at which it sold motor fuel and it brings certiorari.

Judgment set aside.

Argued October term, 1939, before PARKER, BODINE, and PERSKIE, JJ.

Charles Hershenstein, of Jersey City, for prosecutor.

David T. Wilentz and Arthur A. Salvatore, both of Trenton, for respondent.

PERSKIE, Justice.

The single question requiring decision in this cause is whether subdivision (c) under section 201, chapter 62, P.L.1939, R.S. 39:12-2 (c), N.J.S.A. 39:12-2 (c), deprives prosecutor of its property without due process of law in violation of the 14th Amendment to our Federal Constitution, U.S.C.A. Const., or whether it is justified as a valid exercise of the police power of the state.

The return to the writ discloses that, in pursuance of section 401, Art. IV, chap. 163, P.L.1938, R.S. 39:12-4, N.J.S.A. 39:12-4, the State Tax Commissioner filed a complaint, in a summary proceeding, in the First Criminal Court of Jersey City alleging that, on July 20, 1939, prosecutor violated subdivision (c) of sec. 201, Art. II, chap. 62, P.L.1939, R.S. 39:12-2, N.J.S.A. 39:12-2 (c), in that, as a retail dealer in the sale of motor fuels, it "did unlawfully and illegally use and display" on its premises in Jersey City, "a sign relating to the price" at which it sold its motor fuel. In answer to the complaint, prosecutor appeared through its counsel; he admitted the truth of the facts alleged in the complaint and waived all defects, if any, in said complaint. Additionally, exhibits P-2 and P-3 were admitted. These exhibits are photographs of prosecutor's stations and show the allegedly objectionable signs.

The trial judge, thereupon, entered judgment of $50 (minimum prescribed penalty, sec. 301, Chap. 62, P.L.1939, R.S. 39:12-3, N.J.S.A. 39:12-3), in favor of plaintiff and against prosecutor. The prosecutor paid the penalty, under protest. Aggrieved at the penalty thus imposed upon it, and desiring to test the constitutionality of the act under which it was imposed, prosecutor made application to the Chief Justice for a writ of certiorari, which was allowed.

For a better understanding of the claims made for the respective parties, a brief resume of the legislation involved will be helpful.

Chap. 62, P.L.1939 was approved May 23, 1939; it amended chap. 163, P.L.1938 ("An Act to regulate the retail sale of motor fuels, and providing penalties for violations") approved May 12, 1938. A reading of both acts discloses, save as to subdivisions (c) and (d), sec. 201, Art. II, and some changes in sections 201 (a) and 301 in the act of 1939, that they are practically the same word for word.

As amended the act of 1939, N.J.S.A. 39:12-2, provides substantially as follows 201 (a). Every retail dealer shall publicly display and maintain on each pump (or other dispensing equipment) a sign, in the manner regulated by the State Tax Commissioner, stating the price per gallon at which motor fuel is sold; all taxes shall be included in the price shown on the sign, but the sign shall contain a statement of the amount of taxes included in said price, or if it is not so stated, said sign shall state that taxes are included in said price. A retail dealer shall not sell at any other price than the price, including taxes, so posted. A price when posted shall remain posted and in effect for at least 24 hours.

(b) No retail dealer shall sell motor fuel at a price which is below net costs plus all selling expenses.

(c) No other price sign of motor fuel so dispensed, or signs relating to the price of such fuel shall be used or displayed on or about the premises where motor fuel is sold at retail, other than the signs provided herein by section two hundred and one (a).

(d) Prohibits advertising or signs other than provided in section 201 (a); it further provides that the advertising shall be identified by the name of the product and that the letters of the name shall not be less than one-half the size of the figures used in the price.

(e) Prohibits the allowances of rebates, concessions or benefits directly or indirectly.

(f) Prohibits the use of lotteries, prizes, wheels of fortune, punch boards or other games of chance, in connection with the sale of motor fuels.

(g) Requires that all above ground equipment for the storing or dispensing of motor fuel shall bear, in a conspicuous place, the name or trade mark of the product stored or dispensed therefrom; additionally, it prohibits delivery into underground or above ground containers, etc., of any motor fuel other than the brand represented as being in the container, etc.; and it prohibits the substitution of one grade of motor fuel for another.

(h) Provides that if the motor fuel stored or dispensed in the containers, etc., shall have no brand name or trade mark, that fact shall be conspicuously displayed on the container, etc., in these words "No Brand."

Section 301, N.J.S.A. 39:12-3, provides penalties.

In pursuance of section 201 (a) the State Tax Commissioner did, on June 19, 1939, prescribe rules concerning the display of advertising signs by retail dealers in motor fuels. (Regulation RC-1).

These regulations provide, among other things, that (1) "each pump or other dispensing equipment maintained by any person operating a service station, filling station * * * for the sale of motor fuel for delivery into the service tank or tanks of any motor vehicle propelled by an internal combustion engine shall have a metal bracket not less than 5 1/2" x 8" and not more than 8" x 10" attached to it, in which shall be placed a price sign (card insert) not less than5 1/2x 7 1/2" and not more than 7 1/5" x 9 1/2" stating the price per gallon at which motor fuel may be purchased from such pumps * * *." "The price sign shall show only the unit price per gallon. Such unit price shall include all taxes imposed whether State or Federal * * *." And (2) that the price sign (card insert) shall be displayed on both sides of the bracket.

Examination of exhibits P-2 and P-3 shows that one sign is located on prosecutor's property facing the highway; it consists chiefly of the trade name of prosecutor's product, namely, "Merit," after which follows price figures of 12 9/c. inclosed in a circle; the other is a small portable sign which stands at or near the curb of the sidewalk abutting the front of prosecutor's property; on this sign there also appears the trade name of "Merit" and under that trade name are the price figures of 12 9/.

Prosecutor admittedly used these nonconforming signs in addition to the conforming signs used by it. The admitted objective of the additional signs was to attract the purchasing power of the approaching and passing motorists. Prosecutor asserts its right to reach that objective as one of the reasonable, necessary and vital factors incident to and part and pareel of its common law right to engage in a lawful private business, here, that of selling motor fuel. Because that right is allegedly denied to it, prosecutor asserts the broad claim that chap. 62, P.L.1939, permits the taking of its property without due process of law in violation of the 14th Amendment to the Federal Constitution, and therefore the entire act is void. On the other hand, respondent asserts the equally broad claim that the challenged act preserves rather than destroys property rights; that it prevents price wars which theretofore had led to unfair trade practices, such, for examples, as unfair competition, adulteration and misbranding, and that, therefore, the act in its entirety is a valid exercise of the police power of the state in furtherance of public welfare; public convenience and prosperity. Our consideration and determination of this cannot be bottomed upon any such broadly asserted claims. By the record, as submitted, we are of necessity limited to the question first stated as requiring decision. To determine the answer to the question submitted we proceed to our consideration of the applicable law and to the proofs submitted.

First: The legal principles involved are rather well established. While it is true that a state may, in the exercise of its police power, pass legislation for the purpose of protecting and regulating public health, public safety, public morals, general welfare (cf. New York & N. E. R. Co. v. Town of Bristol, 151 U.S. 556, 557, 14 S.Ct. 437, 38 L.Ed. 269, 273), including public convenience or the general prosperity (cf. ...