State ex rel. Zeller v. Montgomery Circuit Court

• Decision Date: 19 July 1945
• Docket Number: 28097.
• Citation: 62 N.E.2d 149,223 Ind. 476
• Parties: STATE ex rel. ZELLER, Sheriff, et al., v. MONTGOMERY CIRCUIT COURT et al.
• Court: Indiana Supreme Court

62 N.E.2d 149

223 Ind. 476

STATE ex rel. ZELLER, Sheriff, et al., v. MONTGOMERY CIRCUIT COURT et al.

No. 28097.

Supreme Court of Indiana

July 19, 1945

James A. Emmert, Atty. Gen., Cleon H. Foust, First Deputy Atty. Gen., and Winslow Van Horne and Karl J. Stipher Deputy Attys. Gen., for relator.

Lutz Johnson & Lutz, of Indianapolis, for respondents.

STARR Judge.

This is an original action brought by the State of Indiana, on the relation of Harold M. Zeller, as Sheriff of Montgomery County, indiana, and others, against Montgomery Circuit Court, Montgomery County, Indiana, and Howard A. Sommer, as Judge of said court, to obtain a writ of prohibition. The petition asks that the respondents be restrained from taking any further steps in cause number 28204 now pending in the Montgomery Circuit Court and from enforcing the restraining order theretofore entered therein. This court issued its temporary writ of prohibition and required respondents to show cause why such writ should not be made permanent.

One Eldon B. Riggs is the plaintiff in said cause 28204, and the relators herein are the defendants. The verified complaint therein alleges that on September 20 1944, plaintiff was granted a permit under the laws of the State to conduct a business as a beer wholesaler of alcholic malt beverages for a period of one year from November 15 1944; that he was and still is qualified to conduct said business under said permit and for which he paid a license fee of $1,000; that he has carried on said business in Montgomery County for the last twelve years under permits of the State and is now in said business. Plaintiff further alleges that in order to carry on said business he has made a large financial investment in property used by him in the business and has large stocks of goods on hand. They by Chapter 357 of the Acts of the General Assembly for the year 1945, particularly Section 11 1/2 thereof, plaintiff's said permit was 'arbitrarily, without cause, and without notice or hearing' canceled and declared null and void after May 1, 1945; that said act is unconstitutional and of no force, and the defendants are threatening him with arrest and prosecution under the provisions of said act; that he has no adequate remedy at law and he prays that the defendants be enjoined and restrained from interfering with him in the operation of his business as a beer wholesaler operating under his said permit, and that said act be declared unconstitutional.

A temporary restraining order was issued by the respondents restraining the defendants from interfering with the plaintiff in the operation of his business as a beer wholesaler or from in any way denying or interfering with his rights under his said permit issued to him by the Alcoholic Beverage Commission on September 20, 1944.

Relators in seeking this writ contend that the Circuit Court of Montgomery County has no jurisdiction in this case, and advance the following reasons for said contention:

First, that there is no property right involved, as said permit is not property, and a court of equity has no jurisdiction of an action when property rights are not involved and the sole purpose is to test the constitutionality of a statute.

Second, that in issuing the restraining order said court was interfering with the enforcement of the criminal laws of the State of Indiana.

Third, that this is a suit against the State of Indiana without its consent. Art. 4, Sec. 24, Constitution of Indiana.

As was said in State ex rel. Indiana Alcoholic Beverages Commission et al., v. Circuit Court of Marion County, et al., 1943, 221 Ind. 572, 574, 49 N.E.2d 538, 'It is well and firmly established that the jurisdiction and power of courts of equity to issue restraining orders is limited to the protection of civil and property rights.' Section 2, Chapter 237, of the Acts of the General Assembly for the year 1941, under which respondent obtained his said permit, specifically provides, 'That no person shall be deemed to have a property right in any permit issued hereunder, nor shall said permit itself or the enjoyment thereof be considered a property right.' This provision is substantially enacted in the present law. Acts 1945, Chapter 357, Sec. 11. Had not these provisions been enacted, still such permit would not have been a property right. Our court has consistently held that a license to sell alcoholic beverages is not property. State ex rel. Indiana Alcoholic Beverages Commission et al. v. Circuit Court of Marion County, supra; Schmitt v. F. W. Cook Brewing Co., 1918, 187 Ind. 623, 120 N.E. 19, 3 A.L.R. 270 .

In the case of Moore v. City of Indianapolis, 1889, 120 Ind. 483, 491, 22 N.E. 424, 427, this court said: 'It is, however, abundantly settled that a license or permit issued in pursuance of a mere police regulation has none of the elements of a contract, and that it may be changed or entirely revoked, even though based upon a valuable consideration. Cooley, Const. Lim. [5th Ed.], 343. A license issued under the law regulating the sale of intoxicating liquors has neither the qualities of a contract nor of property, but merely forms a part of the internal police system of the state. [Metropolitan] Board v. Barrie, 34 N.Y. 657. No one can acquire a vested right in a mere statutory privilege so as to bind the state, or to prevent a change of policy as the varying interests of society may require. Cooley, Const.Lim. [5th Ed.] 473.'

Some intimation is made in plaintiff's complaint that he will suffer damages to his going business due to the fact that he has operated same over a period of years and has a large investment therein. This cannot avail him. 'No provision of our Constitution has been pointed out which forbids the passage of laws to protect the health, morals, or welfare of the people in connection with the traffic in intoxicating liquor, even though such laws destroy previously recognized property without paying for it. That the liquor traffic is within the police power of the state no one denies. When this is admitted, there must follow the power to take such steps as are reasonably suitable to carry out this purpose.' Schmitt v. F. W. Cook Brewing Co., supra, 187 Ind. at page 626, 120 N.E. 21, 3 A.L.R. 270.

There being no civil or property rights involved, plaintiff cannot question the constitutionality of this act, as he would have a complete and adequate remedy at law, for if arrested and prosecuted he could defend on the ground that the law is unconstitutional, if such is the case. As was said in State ex rel., v. Marion Circuit Court, supra, 221 Ind. at page 574, 49 N.E.2d 538; 'If the order attempting to revoke the license is invalid and void, the privilege of selling continues without the intervention of any court, by injunction or otherwise. If law enforcement officers bring criminal proceedings upon the ground that the license has been legally revoked when it has not been so revoked, the defendant has a complete and adequate remedy at law in his defense that he was selling under a license which was in legal effect.'

Plaintiff's suit is an attempt to question the constitutionality of a statute where no property rights are involved, which cannot be done. Respondents in issuing said restraining order were enjoining the operation of our criminal statutes and the enforcement of the criminal law. Neither can this be done. Judge Fansler, in stating the opinion of this court in the case of State ex rel. Fry v. Superior Court of Lake County, 1933, 205 Ind. 355, 362, 186 N.E. 310, 313, said: 'The language of some of the decisions had led text-writers to state the rule to be that equity has no jurisdiction to enjoin criminal prosecutions or the operation of criminal statutes except in certain cases, but we believe the true rule to be that equity has no jurisdiction in such matters in any case. It has, however, jurisdiction to protect property rights by injunction where the petitioner has no adequate remedy at law and where the injunction for the protection of property rights incidentally involves restraining and enjoining criminal prosecutions or the enforcement of a criminal statute this fact will not destroy the jurisdiction. Where one seeks injunctive relief, involving the enjoining of criminal prosecutions or the operation of a criminal statute, he must show that such relief is but incidental and that the basis of his action is the protection of a property right.' See People ex rel. L'Abbe et al., v. District Court, 1899, 26 Colo. 386, 58 P. 604,

46 L.R.A. 850; State ex rel. Kenamore v. Wood et. al., 1900, 155 Mo. 425, 56 S.W. 474, 48 L.R.A. 596.

The cases of Fitts v. McGhee, 1899, 172 U.S. 516, 19 S.Ct. 269, 43 L.Ed. 535, and Ex parte Ayers, 1887, 123 U.S. 443, 8 S.Ct. 164, 31 L.Ed. 216, are leading cases to the point that the plaintiff's action is against the State. In our opinion these cases have been somewhat modified by the case of Ex parte Young, 1907, 209 U.S. 123, 52 L.Ed. 714, but due to the fact that no property rights are involved in plaintiff's case and that respondents' action is an attempt to interfere with the enforcement of the criminal law, we need not determine whether this is a suit against the State.

Respondents have suggested that the writ should not issue in this case as the Montgomery Circuit Court had jurisdiction of the subject matter of the action and of the parties, citing State ex rel. Harkness et al., v. Gleason, Judge, et al., 1918, 187 Ind. 297, 119 N.E. 9. With this we cannot agree. The court must also have jurisdiction of this particular class of cases, which it has not. State ex rel. Coffin v. Superior Court of Marion County et al., 1925, 196 Ind. 614, 149 N.E. 174; State ex rel. Fry. v. Superior Court of Lake County, supra; State ex rel....