Ruppert v. Liquor Control Commission

• Decision Date: 22 April 1952
• Citation: 138 Conn. 669,88 A.2d 388
• Court: Connecticut Supreme Court
• Parties: RUPPERT et al. v. LIQUOR CONTROL COMMISSION. Supreme Court of Errors of Connecticut

Page 388

88 A.2d 388

138 Conn. 669

RUPPERT et al. v. LIQUOR CONTROL COMMISSION.

Supreme Court of Errors of Connecticut.

April 22, 1952.

John J. Kinney, Jr., New Haven, with whom were Edward L. Reynolds, Jr., Hamden, and, on the brief, Walton E. Cronan, West Haven, for appellants (plaintiffs).

William L. Beers, Deputy Atty. Gen., with whom, on the brief, was George C. Conway, Atty. Gen., for appellee (defendant).

Before BROWN, C. J., and JENNINGS, BALDWIN, INGLIS and O'SULLIVAN, JJ.

BALDWIN, Associate Justice.

George E. Ruppert of New York City made application to the liquor control commission for the renewal of an out-of-state shipper's permit for beer only. Jacob Ruppert, a New York corporation, was the proposed backer. The New York corporation owns 748 out of a total of 750 shares of stock in Jacob Ruppert, Inc., a Connecticut corporation. This Connecticut corporation is presently the backer of four wholesaler permits for beer only issued to its branch managers at Bridgeport, Hamden, Hartford and Norwich. The commission, acting pursuant to General Statutes, § 4266, denied the out-of-state shipper's permit to George E. Ruppert because of the identity of control or interest of his proposed backer and the backer of the wholesaler beer permits. The commission's action was affirmed by the Court of Common Pleas upon facts which were undisputed and based upon admissions in the pleadings and a certified transcript of the testimony before the commission, admitted under § 4277 of the General Statutes. George E. Ruppert and Jacob Ruppert, the New York corporation have appealed.

The appeal presents two major issues for determination: the legal interpretation of General Statutes, § 4266, and its constitutionality as applied to these plaintiffs. If the section is to be interpreted as not applying to an out-of-state shipper's permit, or if it is unconstitutional, as the plaintiffs claim, the action of the commission in denying the permit is without legal sanction.

Section 4266 is set forth in full in a footnote. ¹ The plaintiffs direct their argument at the provision contained in the first sentence: 'No backer or permittee of one class shall be a backer or permittee of any other class except in the case of railroad and boat permits.' In considering the question of interpretation raised by the plaintiffs, we observe that the facts in the instant case are identical in their effect with those in Downer v. Liquor Control Commission, 134 Conn. 555, 59 A.2d 290, wherein we sustained the commission in denying an application for a wholesaler beer permit which proposed as a backer one who was already the backer of an out-of-state shipper's permit for beer only. One exception should be noted. In the Downer case, Liebmann Breweries, Inc., a New York corporation, was the proposed backer upon an application for a wholesaler beer permit in Hartford. It was also the backer of a Connecticut out-of-state shipper's permit for beer only. In the case at bar, two separate corporations, are involved as backers. The one, a Connecticut corporation, is already the backer of four wholesaler permits for beer only in this state. The other, one of the plaintiffs in this action, a New York corporation which owns and controls the Connecticut corporation, is the proposed backer upon an application for an out-of-state shipper's permit for beer only. The plaintiffs concede that to all practical intents and purposes the backers are one and the same, in spite of their separate corporate identities. See Eder v. Patterson, 132 Conn. 152, 155, 42 A.2d 794; United States v. Northern Securities Co., C.C., 120 F. 721, 726, affirmed, 193 U.S. 197, 24 S.Ct. 436, 48 L.Ed. 679. Their claim is that the prohibition contained in § 4266 was never intended by the legislature to apply to an out-of-state shipper's permit. They reason that such a permit allows sales only to wholesalers and manufacturers, whereas the statute was intended to deal only with the business dealings of manufacturers or wholesalers with retail permittees. Much the same argument was advanced in the Downer case, supra, 134 Conn. 559, 59 A.2d 290. We held in that case that the statute did apply. We have re-examined that decision and conclude that the interpretation we there gave to the statute is controlling in the case now before us.

The plaintiffs claim that in so far as § 4266 applies to out-of-state shippers' permits, it violates the fourteenth amendment of the constitution of the United States because it is discriminatory and denies to them the equal protection of the laws and also deprives them of their property without due process of law. This precise question has not heretofore been before us. See Downer v. Liquor Control Commission, supra, 134 Conn. 559, 59 A.2d 290; State v. Zazzaro, 128 Conn. 160, 165, 20 A.2d 737. No question was raised in argument or brief concerning the right of the plaintiffs to attack the constitutionality of the statute under which they are making application for a permit. Strain v. Zoning Board of Appeals, 137 Conn. 36, 38, 74 A.2d 462; see Keating v. Patterson, 132 Conn. 210, 215, 43 A.2d 659. Since the question of constitutionality is before us and the parties have tried the cause as though it was properly so, we adopt the issue as framed by counsel because the question is one of public importance and it is desirable in the public interest to dispose of it. Donovan v. Davis, 85 Conn. 394, 399, 82 A. 1025; Maltbie, Conn.App.Proc., §§ 22, 44. The plaintiffs argue that by reason of the statute brewers resident in Connecticut have the privilege of manufacturing and wholesaling under one permit and with one backer, while a nonresident brewer must obtain an out-of-state shipper's permit to bring beer into the state and, in addition, must have a wholesaler permit, with another and different backer, to distribute it, and that the act denies him the privilege accorded to Connecticut residents.

The twenty-first amendment to the constitution of the United States allows the exercise of very broad police powers by the states with respect to alcoholic liquors. The states may absolutely prohibit the manufacture, transportation, sale or possession of such liquors within their borders or they may permit these activities under conditions prescribed by their legislatures. To these ends they can adopt such measures as they may deem reasonably appropriate. Ziffrin, Inc., v. Reeves, 308 U.S. 132, 138, 60 S.Ct. 163, 84 L.Ed. 128; Francis v. Fitzpatrick, 129 Conn. 619, 621, 30 A.2d 552, 145 A.L.R. 505. Because of the danger to the public health and welfare inherent in the liquor traffic, the police power to regulate and control it runs broad and deep, much more so than the power to curb and direct ordinary business activity. Mugler v. Kansas, 123 U.S. 623, 662, 8 S.Ct. 273, 31 L.Ed. 205; Crane v. Campbell, 245 U.S. 304, 307, 38 S.Ct. 98, 62 L.Ed. 304; see State v. Porter, 94 Conn. 639, 643, 110 A. 59; State v. Conlon, 65 Conn. 478, 486, 33 A. 519, 31 L.R.A. 55, 30 Am.Jur. 278, § 40.

The Liquor Control Act, presently chapter...