State ex rel. Lee, Atty. Gen. v. Continental Oil Co

• Decision Date: 16 April 1935
• Docket Number: 1891
• Citation: 43 P.2d 686,48 Wyo. 152
• Parties: STATE EX REL. LEE, ATTY. GEN. v. CONTINENTAL OIL CO
• Court: Wyoming Supreme Court

43 P.2d 686

48 Wyo. 152

STATE EX REL. LEE, ATTY. GEN. v. CONTINENTAL OIL CO

No. 1891

Supreme Court of Wyoming

April 16, 1935

RESERVED CONSTITUTIONAL QUESTIONS from the District Court Laramie County; C. O. BROWN, Judge.

Proceeding in the nature of quo warranto by the State, on the relation of Ray E. Lee, Attorney General, against the Continental Oil Company. On reserved constitutional questions from the district court.

For the plaintiff, there was a brief by Ray E. Lee, Attorney General Oscar O. Natwick, Deputy Attorney General, and Wm. C. Snow Assistant Attorney General, of Cheyenne, and oral arguments by Messrs. Lee and Natwick.

Cases such as U. S. v. Cohen Grocery Company, 255 U.S. 81, Cline v. Frink Dairy Company, 274 U.S. 445 and H. Earl Clack Co. v. Commission, (Mont.) 29 P.2d 1056, have no application to the case at bar. The Wyoming statute was adopted from the South Dakota statute. Section 117-201, R. S. 1931. The South Dakota statute has been construed by the United States Supreme Court in Lumber Company v. State, 226 U.S. 155, and by the Dakota Court in State v. Lumber Company, 123 N.W. 504, and we believe that those cases should govern rather than cases cited in the brief of defendant, by reason of the language of the Wyoming statute. Leo Nebbia v. People, 78 U.S. 563. Defendant also cites the case of State v. Read Company, 33 Wyo. 387, involving an eight-hour statute, but we are unable to see wherein that case may be considered in an attack on Section 117-201, R. S., a statute complete in itself. The case of Connally v. Construction Company, 269 U.S. 385, also involved a defective statute and is readily distinguishable from the case at bar. The cases cited by defendant pertain to state statutes intended to avoid monopolies. Numerous Federal decisions pertaining to Federal statutes on the same subject appear in the reported decisions. Defendant complains of the unfair competition statute, on the ground that it denies to business concerns the right of freedom of contract guaranteed by the constitution. There is no absolute freedom of contract. C., B. & Q. R. R. Co. v. McGuire, 219 U.S. 549; Nebbia v. State, supra; State v. Central Lumber Co., supra. The use of property and the making of contracts are matters of private and not public concern. The general rule is that both shall be free of governmental interference, but neither property rights nor contract rights are absolute. Allgeyer v. Louisiana, 165 U.S. 578, 591; Atlantic Coast Line R. Co. v. Riverside Mills, 219 U.S. 186; Stephenson v. Binford, 287 U.S. 251; Munn v. Illinois, 94 U.S. 113; Orient Insurance Company v. Daggs, 172 U.S. 557; Northern Securities Company v. United States, 193 U.S. 197. The case of Cline v. Frink Dairy, 274 U.S. 445, cited by defendant, involved a Colorado statute held to be defective, in that it failed to define unlawful acts. The same is true of the statute involved in Clack Company v. Commission, (Mont.) 22 P.2d 1056. Defendant's contention that the Wyoming statute denies it the equal protection of the law and that its property will be taken without due process of law, we believe is sufficiently answered by the opinion in Central Lumber Co. v. South Dakota, 226 U.S. 155, and in State v. Lumber Company, 123 N.W. 504. Recent court decisions support a liberal construction of the constitution as applied to price-fixing statutes; unfair competition statutes; the question that private character of business does not necessarily remove it from the realm of regulation of charges or prices; business affected with a public interest and the police power of states. Nebbia v. People, supra; Building Association v. Blaisdell, 78 L.Ed. 255. We also direct the court's attention to Spielman Company v. Dodge. The Wyoming unfair competition statute has not been superseded by the National Industrial Recovery Act or by the Wyoming State Industrial Recovery Act. The Wyoming cases of Mahoney v. State, 5 Wyo. 520; Tucker v. State, 35 Wyo. 430, and State v. Berry, 36 Wyo. 257, cited by defendant are not decisive, and are of no particular value as authority in the case at bar, for the reason that they involve different facts, and the first of them was decided before the enactment of the statute here under discussion. Wyoming has not made an attempt to enforce laws as to acts which have occurred beyond the boundaries of the state. The Wyoming Unfair Competition Statute does not attempt to make the discrimination illegal irrespective of any unlawful motive, nor is it an unlawful delegation of judicial power. 2 R. C. L., Section 8. People v. Ballard, 32 N.E. 54. The attorney general of the state has a wide range of powers at common law, in addition to his statutory powers. Mundy v. McDonald, 185 N.W. 877.

For the defendant, there was a brief by John R. Moran and Smith, Brock, Akolt & Campbell, all of Denver, Colorado, and W. L. Walls, of Cheyenne, and oral argument by Messrs. Moran, Akolt and Walls.

The action brought by the attorney general, in the nature of a quo warranto proceeding, alleges violation by defendant of the "Wyoming Unfair Competition Statute," Article 2, Chapter 117, R. S. 1931. Defendant demurred to both counts or causes of action of plaintiff's amended petition. The trial court, on its own motion, certified to the Supreme Court what it deemed to be 20 important and difficult questions raised by the demurrer. The statute upon which the action is based, is vague, indefinite and uncertain, and furnishes no proper or ascertainable standard of guilt, thus attempting to deprive defendant of its life, liberty and property, without due process of law, in violation of Section 1, Article XIV of the Federal Constitution and of Section 6 of Article I of the Wyoming Constitution. State v. Read Company, 33 Wyo. 387; U. S. v. Grocery Company, 255 U.S. 81, and cases cited; Conally v. Company, 269 U.S. 385. Section 117-201, R. S. 1931 attempts to define acts constituting "unfair discrimination" and Section 117-201, R. S. provides certain exceptions. When this statute is considered in connection with the allegations of the amended petition, the defects of the statute and the pleadings are clearly apparent. Investment Company v. Company, (Texas) 65 S.W.2d 495; Board of Trade v. U.S. 246 U.S. 231, and cases cited. Certainty in a penal statute is one of the first requirements of due process of law. The statute must be strictly construed. State v. Read Company, supra; Cline v. Dairy Company, 274 U.S. 445; Weeds v. United States, 255 U.S. 109; Standard Corporation v. Waugh Company, (N. Y.) 131 N.E. 566; Earl Clack Company v. Public Service Commission, (Montana) 22 P.2d 1056; Williams v. Standard Oil Company, 278 U.S. 235; Tyson & Bro. v. Banton, 273 U.S. 418; Ice Company v. Liebmann, 285 U.S. 262; Creamery Company v. State, 274 U.S. 1. The exceptions to the provisions of the statute are repugnant to Section 1 of Article XIV, United States Constitution, Sections 6 and 34 of Article I of the Wyoming Constitution, in denying this defendant equal protection of the law, and its property being taken without due process of law, in violation of said constitutional provisions. Connolly v. Union Sewer Pipe Company, 184 U.S. 540; Creamery Company v. Cline, 9 F.2d 176; Cline v. Dairy Company, supra, and cases cited; United States v. Armstrong, 265 F. 683; Smith v. Cahoon, 283 U.S. 553; State v. Le Barron, 24 Wyo. 519; State v. City of Sheridan, 26 Wyo. 347; McFarland v. Refining Company, 241 U.S. 79. The statute has been superseded by the National Industrial Recovery Act. A number of cases are pending involving the National Industrial Recovery Act and similar acts, none of which have as yet reached the Supreme Court. A suspension of a statute has the same effect as a repeal. State v. Berry, 36 Wyo. 257; Mahoney v. State, 5 Wyo. 520; Tucker v. State, 35 Wyo. 430; United States v. Reisinger, 122 U.S. 398; Commonwealth v. Louisville, etc., Co., 215 S.W. 938. The Wyoming Unfair Competition Statute unlawfully attempts to give extra territorial effect to Wyoming laws, and is an unlawful interference with interstate commerce. 59 C. J. 21; State v. Company, (S. D.) 123 N.W. 504; State v. Company, (Minn.) 126 N.W. 527; State v. Creamery Company, (Iowa) 133 N.W. 895; F. & D. Company v. Tafoya, 270 U.S. 426; Ins. Co. v. Dunken, 266 U.S. 389; Creamery Company v. State, (Minn.) 274 U.S. 1. The statute is an unlawful delegation of judicial power to the attorney general, in violation of Section 1 of Article II, and Section 6 of Article I, Wyoming Constitution. State v. Blaisdell, supra.

RINER, Justice. KIMBALL, Ch. J., and BLUME, J., concur.

OPINION

RINER, Justice.

This cause comes to this court upon reserved constitutional questions undertaken to be submitted pursuant to the provisions of sections 89-5001 to 89-5003 inclusive, W. R. S. 1931, and said to be important and difficult questions arising upon the record thereof. The litigation was instituted in the district court of Laramie County on behalf of the State of Wyoming, by its attorney general, and is in the nature of a Quo Warranto proceeding to forfeit the permit of the defendant The Continental Oil Company, a corporation created and existing under the laws of the state of Delaware, to do business in this state. Article 2, Chapter 117, dealing with the subject matter of "Unfair Competition," and particularly sections 117-201 and 117-202 thereof, W. R. S. 1931, is relied upon by the plaintiff as supplying the statutory authority for the action thus commenced.

Section 117-202, supra, indicates the procedure to be followed when its preceding section is invoked, and prescribes one of the penalties imposed by Article 2 aforesaid, when there occurs an adjudged violation of the terms of the substantive law embodied in section...