State ex rel. Pay Less Drug Stores v. Sutton

• Decision Date: 02 February 1940
• Docket Number: 27903.
• Citation: 2 Wn.2d 523,98 P.2d 680
• Parties: STATE ex rel. PAY LESS DRUG STORES et al. v. SUTTON, Judge.
• Court: Washington Supreme Court

98 P.2d 680

2 Wn.2d 523

STATE ex rel. PAY LESS DRUG STORES et al. v. SUTTON, Judge.

No. 27903.

Supreme Court of Washington

February 2, 1940

Department 2.

Original certiorari proceeding by the State of Washington, on the relation of the Pay Less Drug Stores and others, against the .honorable H. G. Sutton, Judge of the Superior Court of the State of Washington in and for Kitsap County, to review a restraining order issued by the respondent in a case pending Before him.

Order reversed.

S. A Gagliardi and A. M. Ursich, both of Tacoma, for petitioners.

Ralph E. Purves, of Bremerton, for respondent.

BEALS Justice.

Pay Less Drug Stores is a corporation, owning and operating several stores in the state of Washington, for the sale of merchandise at retail, one of its stores being located in the city of Bremerton. T. A. Zimmerman is general manager for the corporation in the state of Washington, and J. L. Snow is manager of its Bremerton store. Among other things, the stores sell cigarettes, cigars and tobacco in other forms together with many other articles of merchandise.

On or about December 18, 1939, the prosecuting attorney for Kitsap county filed in the office of the clerk of the superior court for that county a complaint entitled: 'State of Washington, Plaintiff, v. Pay Less Drug Stores, T. A Zimmerman, J. L. Snow, Defendants.' After formal allegations, the complaint alleged that since June 7, 1939, when chapter 221, page 923, of the Session Laws of 1939, known as 'Unfair Practices Act,' became effective, the defendants had, in their store, sold various brands of cigarettes and tobaccos at less than the cost thereof, as defined by the act, and had been using these articles as 'loss leaders' in the promotion of sales of other merchandise, all in violation of the statute above referred to. It was also allegedthat the business practice of defendants in the particular mentioned was unfair, and was for the purpose of destroying competition and obtaining an unfair advantage over the other merchants engaged in the same business. It was further alleged that the tobacco and cigarette trade in and around Bremerton had established a cost survey in connection with the retail sale of cigarettes and tobacco, and that in accordance with this survey, certain brands of cigarettes and tobacco could not be sold at prices less than prices set forth in the complaint, without selling the tobacco at less than cost. There was no allegation as to when this 'cost survey' was made. The complaint concluded with allegations that the defendants therein named had violated the statute, to the damage of the public generally; that no adequate remedy at law existed; and that the defendants would continue their alleged unlawful practices unless restrained by order of the court. The complaint demanded the issuance of a temporary restraining order; that after a hearing, a temporary injunction be issued; and that on the trial such temporary injunction be made permanent; the temporary injunction asked for to restrain defendants from selling cigarettes and tobacco at the prices at which defendants were selling the same, or at any other price below the alleged cost price, and to restrain defendants from advertising the articles mentioned at the prices at which they had been selling the same.

Immediately upon filing the complaint, the court signed an order entitled 'Order to Show Cause and Temporary Restraining Order,' restraining and enjoining the defendants, until the further order of the court, from advertising, offering for sale, or selling the brands of cigarettes and tobacco named in the order, at less than prices fixed in the order, which were higher than the prices at which the complaint alleged defendants were selling such merchandise, the order being returnable January 8, 1940.

By its terms, the order was not limited to the store operated by defendants in the city of Bremerton, but contained no territorial limits whatsoever.

December 20th, the defendants moved to dissolve the temporary restraining order, at the same time serving a notice calling the motion for hearing for the following day. In the argument Before this court, it was stated that at the time and place referred to in the notice, the prosecuting attorney objected to consideration of the motion, upon the ground that he had not been given three days notice thereof, as required by the rules of court. The record shows, however, that the court heard the argument of counsel, and denied defendants' motion to dissolve the order.

The defendants in the action then filed in this court an original proceeding by way of a petition for a writ of certiorari, naming the trial judge as respondent, and seeking to review the order above referred to. This court issued an order to show cause why the writ should not issue, the order restraining the respondent judge from proceeding further in the matter until the hearing Before this court. In response to the order to show cause, a return was made by the respondent judge, and after argument, the matter was submitted to this court on the merits.

The title of chapter 221, Session Laws of 1939, above referred to, reads as follows: 'An Act relating to unfair competition, discrimination and practices in connection with the sale of certain articles and commodities and the rendering of certain services; defining, prohibiting and making the same unlawful; providing for civil and criminal actions in connection therewith; and prescribing penalties.'

Pursuant to § 13 of the act, the attorney general and the prosecuting attorneys, in their respective counties, are vested with power to institute and maintain actions, in the name of the state of Washington, to restrain and enjoin any person from performing, or continuing the performance of, any act or conduct prohibited by the section. By § 10 of the act, the violation of the provisions thereof is made a misdemeanor, punishable by fine, or by imprisonment in the county jail, or both.

Rem.Rev.Stat. § 722, reads as follows: 'No injunction shall be granted until it shall appear to the court or judge granting it that some one or more of the opposite party concerned has had reasonable notice of the time and place of making application, except that in cases of emergency, to be shown in the complaint, the court may grant a restraining order until notice can be given and hearing had thereon.'

Respondent argues that under the unfair practices act, the superior court may issue temporary restraining orders without notice, and that such orders may be based merely upon a complaint filed in the name of the state, by the proper officer, and an affidavit alleging the existence of an emergency under the act, the order itself containing a finding that such an emergency exists. Respondent also contends that, as § 10 of the act above referred to provides for the punishment of the violation of the act by fine or imprisonment, the act is criminal in its nature, and that alleged criminal acts on the part of one occupying the position of defendants in the action (relators herein) may be restrained without notice.

It is, of course, true that, under the act, a prosecuting attorney can charge a person with a criminal offense, by filing a complaint or information alleging facts constituting a violation of the terms of the statute.

It must be remembered that in the complaint in this action, it is alleged that the defendants in the action had maintained the prices complained of ever since June 7, 1939. There is no question here of a sudden change, or threatened change, in the prices asked by the defendants in the action for the articles referred to in the complaint.

In Black's Law Dictionary, 3d Ed., restraining order is defined as follows: 'An order which may issue upon the filing of an application for an injunction forbidding the defendant to do the threatened act until a hearing on the application can be had. Though the term is sometimes used as a synonym of 'injunction,' a restraining order is properly distinguishable from an injunction, in that the former is intended only as a restraint upon the defendant until the propriety of granting an injunction, temporary or perpetual, can be determined, and it does no more than restrain the proceedings until such determination.'

In Lewis & Spelling, The Law of Injunctions, 30, § 18, is found the following: 'A restraining order is generally granted without notice to the opposite party, and is intended only as a restraint on him until the propriety of granting a temporary injunction can be determined, and it goes no further than to preserve the status until that determination.'

In 1 High on Injunctions, 4th Ed., 9, § 5a, the rule is laid down as follows: 'Since the object of a preliminary injunction is to preserve the status quo, the court will not grant such an order where its effect would be to change the status. Thus, where the plaintiff seeks to enjoin the defendant from interfering with acts about to be done by the plaintiff against the objection of the defendant, a preliminary injunction restraining such interference is erroneous since its effect is to destroy the existing condition of the subject-matter of the suit by permitting the doing of affirmative acts by the plaintiff in advance of the final determination of his right to do them. * * And by the status quo which will be preserved by preliminary injunction is meant the last actual, peaceable, noncontested condition which preceded the pending controversy, and equity will not permit a wrongdoer to shelter himself behind a suddenly and secretly changed status, although he succeeded in making the change Before the hand of the chancellor has actually reached him.'

In 14 R.C.L., 306, is found the following: 'Another form in...