Snyder's Drug Stores, Inc. v. North Dakota State Bd. of Pharmacy

• Decision Date: 04 June 1974
• Docket Number: No. 8834,8834
• Citation: 219 N.W.2d 140
• Parties: SNYDER'S DRUG STORES, INC., Appellee, v. NORTH DAKOTA STATE BOARD OF PHARMACY, Appellant. Civ.
• Court: North Dakota Supreme Court

Page 140

219 N.W.2d 140

SNYDER'S DRUG STORES, INC., Appellee, v. NORTH DAKOTA STATE BOARD OF PHARMACY, Appellant.

Civ. No. 8834.

Supreme Court of North Dakota.

June 4, 1974.

Rehearing Denied June 27, 1974.

Syllabus by the Court

1. Neither the North Dakota Constitution nor the United States Constitution makes it a condition of preventive legislation that it should work a perfect cure. It is enough that the questioned Act has a manifest tendency to cure or at least make the evil less.

2. A State Senator's statement of the intent of a bill in his appearance before a committee of the House of Representatives is not controlling as to the intent of the Legislature in enacting the specific bill.

3. Evils in the same field may be of different dimensions and proportions, requiring different remedies. Or so the Legislature may think. Or the reform may take one step at a time addressing itself to the phase of the problem which seems most acute to the legislative mind. The Legislature may select one phase of one field and apply a remedy there, neglecting the others.

4. Mere existence of a Grandfather Clause within a statute should not of itself make the statute unconstitutional.

5. The Legislature could have reasonably concluded that the necessities of the situation, namely the urgency for providing immediate and continuous pharmaceutical service to a limited clientele (hospital patients), justified the sacrifice of some control, which the Legislature deemed present in the requirement of Section 43--15--35(5), N.D.C.C., that the majority of the stock of a pharmacy be owned by a registered pharmacist in good standing who is actively and regularly employed in and responsible for the management, supervision, and operation of the pharmacy.

6. A classification although discriminatory is not arbitrary or violative of the Equal Protection Clause of the Fourteenth Amendment to the United States Constitution if any state of facts reasonably can be conceived which would sustain it.

7. The prohibition of the Equal Protection Clause of the Fourteenth Amendment to the United States Constitution goes no further than invidious discrimination.

8. The test of Equal Protection under the Fourteenth Amendment to the United States Constitution is whether the legislative line that is drawn bears some rational relationship to a legitimate governmental purpose.

9. For the reasons stated in this opinion, Section 43--15--35(5), N.D.C.C., is found not to be in violation of Section 11, 13, or 20 of the North Dakota Constitution, or of the Due Process Clause and the Equal Protection Clause of the Fourteenth Amendment to the United States Constitution or of the Commerce Clause of Section 8 of Article I of the United States Constitution.

Wattam, Vogel, Vogel & Peterson, Fargo, and Richard C. Johnson, Hopkins, Minn., for appellee.

Conmy, Rosenberg & Lucas, Bismarck, for appellant.

ERICKSTAD, Chief Justice.

Famous last words!

In its brief on appeal to this court prior to our decision in Snyder's Drug Stores, Inc. v. North Dakota State Board of Pharmacy, 202 N.W.2d 140 (N.D.1972), Snyder's, a subsidiary of Red Owl Stores, Inc., said:

'The U.S. Supreme Court will not reverse itself. The argument of the State Board the the U.S. Supreme Court would now reverse the Leggett Company decision and uphold a statute restricting ownership to registered pharmacists, even though it had earlier found no real and substantial relationship between ownership of a drug store by pharmacists and the public health, is not persuasive.'

The Liggett Company decision is none other than Liggett Co. v. Baldridge, 278 U.S. 105, 49 S.Ct. 57, 73 L.Ed. 204 (1928), which we concluded, as a court inferior to the United States Supreme Court on Federal constitutional issues, we were bound by, and upon which we based our decision in Snyder's, holding that Section 43--15--35(5), N.D.C.C., violated the Due Process Clause of Section 1 of the Fourteenth Amendment to the United States Constitution.

Justice Douglas, speaking for a unanimous United States Supreme Court, in an opinion on a writ of certiorari, remanded Snyder's to us with these words:

'The Liggett case, being a derelict in the stream of the law, is hereby overruled. We reverse and remand the judgment below and free the courts and agencies of North Dakota from what the State Supreme Court deemed to be the mandate of Liggett.' North Dakota State Board of Pharmacy v. Snyder's Drug Stores, Inc., 414 U.S. 156, 94 S.Ct. 407 at 414, 38 L.Ed.2d 379 (1973).

Pertinent to the trial court's conclusion on December 30, 1971, that Snyder's was entitled to a permit to operate a pharmacy in the Red Owl Family Center at Bismarck, North Dakota, are paragraphs IX, X, XI, and XII of the conclusions-of-law section of the trial court's findings of fact, conclusions of law, and order for judgment.

'IX.

'The requirement that a majority of the stock of a corporate applicant for a permit to operate a pharmacy in the state of North Dakota be owned by registered pharmacists in good standing in North Dakota is not a reasonable requirement; it does not bear a definite relation to the public health, safety, and welfare and is not expedient and necessary for the protection of public health, public safety, public morals or public welfare. The requirement has no real, substantial relation to public objects which the government may legally accomplish, since it adds nothing to the legitimate regulation of drugs, pharmacists and pharmacies in the state of North Dakota, all of which are already closely and directly regulated by various federal and state statutes and agencies.

'X.

'The exemption from the requirements of subsection 5 of Section 43--15--35 of the North Dakota Century Code of all those who held pharmacy permits on July 1, 1963, and all hospital pharmacies creates a classification which is not reasonably necessary to effect the purpose of the law. The effect of the exemption is to create a privileged class and to grant to that class an immunity which has not been granted on the same terms to all citizens of the state.

'XI.

'Section 43--15--35(5) of the North Dakota Century Code is unconstitutional in that it violates Amendment 14, Section 1 of the United States Constitution, prohibiting a state from denying to any person within its jurisdiction the equal protection of the law and from depriving any person of his liberty or property without due process of law.

'XII.

'Section 43--15--35(5) of the North Dakota Century Code is unconstitutional in that it violates both Section 11 of the North Dakota Constitution, which states that all laws of a general nature shall have uniform operation, and Section 20 of the North Dakota Constitution, which states that no citizen or class of citizens shall be granted privileges or immunities which shall not be granted to all citizens upon the same terms.'

Snyder's contends that the trial judge's conclusion that Section 43--15--35(5), N.D.C.C., is unconstitutional is sustainable for the additional reasons that it violates Section 13 of the North Dakota Constitution, which provides that no persons may be deprived of property without due process of law, and that it violates Article I, Section 8, Clause 3, of the United States Constitution, which gives Congress the power to regulate commerce among the several States.

A summary of the argument of Snyder's, as stated in the introductory part of its brief, follows:

'The reversal by the Supreme Court of the United States adjudicates only the matters expressly ruled on and those matters alone become the law of the case in further proceedings. The only issue thus decided was that Section 43--15--35(5) of the North Dakota Century Code does not violate the due process clause of the 14th Amendment to the Federal Constitution. All other issues relating to that Constitution as well as the North Dakota Constitution are open for decision.

'The requirement of this law that a majority of the stock of a corporate applicant be owned by pharmacists registered in North Dakota is not a reasonable requirement and is not related to the public health, safety or welfare. It bears no real or substantial relation to a legitimate public purpose since it adds nothing to the regulation of drugs, pharmacies and pharmacists which are already closely controlled by federal and state statutes and regulations. What it does do is create a limited privileged class which receives preferential treatment.

'Sections 11 and 20 of the North Dakota Constitution were intended to prohibit this kind of legislation granting special privileges to small but politically powerful classes of people. Section 11 thus requires laws of a general nature to have a uniform impact:

"All laws of a general nature shall have a uniform operation.'

'Section 20 is essentially the converse of Section 11, for it prohibits the legislature from conferring special benefits or privileges upon small groups:

"No special privileges or immunities shall ever be granted which may not be altered, revoked or repealed by the legislative assembly; nor shall any citizen or class of citizens be granted privileges or immunities which upon the same terms shall not be granted to all citizens.'

'Also applicable is Section 13 of the North Dakota Constitution which provides that no person may be derived of property without due process of law. While the United States Supreme Court has determined the Section 43--15--35(5) does not violate the due process clause of the Federal Constitution, that determination is not a bar to a contrary holding by this Court with respect to the due process clause of the North Dakota Constitution.

'Related to Sections 11 and 20 of the North Dakota Constitution is the equal protection clause of the Federal Constitution. A reasonableness standard has also been applied in this area, and at the very least the law in question must bear some rational relationship to a legitimate state purpose.

'Finally, Section...