State v. Dannenberg
| Decision Date | 01 December 1909 |
| Citation | 66 S.E. 301,151 N.C. 718 |
| Parties | STATE v. DANNENBERG. |
| Court | North Carolina Supreme Court |
Appeal from Superior Court, Mecklenburg County; Webb, Judge.
J Dannenberg was convicted of selling near beer without a license, and he appeals. Affirmed.
The sale of near beer, a nonintoxicating beverage resembling beer, is a business standing in a different class from the sale of soda, mineral waters, lemonade, etc., and is subject to strict regulations under the city's police power.
John J Parker and Stern & Stern, for appellant.
The Attorney General and Geo. L. Jones, for the State.
Defendant was charged with engaging in the business of selling near beer without paying the license tax imposed thereon by the city of Charlotte. The ordinance in question taxed every person engaged in the sale of near beer $1,000. The defendant admitted that he was engaged in the business, and had not paid the license tax, but contended that the ordinance is ultra vires, as well as discriminative and prohibitive, and that it violates the fourteenth amendment of the Constitution of the United States.
1. Is the city of Charlotte without authority to pass the ordinance? The ordinance in question reads as follows "Beverages--On every retail or wholesale dealer in Cider (except sweet, unadulterated cider made from apples), Beering, Near Beer, Tidal Wave, Twenty-Three, Hop-Beverage, Noxall, or any drink under any name or discription whatsoever containing as much as one-half of one per cent. of alcohol, per annum" $1,000. We think the authority to levy a license tax upon the business of selling near beer, as upon any other business, is plainly conferred by sections 80 and 82 of the city charter. The first-named section provides for raising revenue for the city by taxation not only upon real and personal property, and also, in connection with section 81, gives express authority to levy license taxes. Section 82 makes it a misdemeanor to carry on any business, profession, trade, or avocation of any kind in said city upon which a license tax has been levied without first obtaining a license therefor. Near beer is now a recognized article of commerce and the sale of it appears to be an established business in those states which have adopted general prohibition laws. It has been judicially defined by the appellate court of Georgia to be Campbell v. City of Thomasville (Ga.App.) 64 S.E. 821. It is a distinct business, which from its very nature admits of strict regulation, under the general police power of the state, by its municipalities upon which that power may have been conferred. It stands legitimately in a different class from the business of selling soda, mineral waters, lemonade, and the like. As was wittily said by the Attorney General upon the argument: We are therefore of opinion that, being a recognized business, it is a legitimate subject of license taxation, and that the city of Charlotte under its charter has power to impose a license tax upon those who engage in it. State v. Irwin, 126 N.C. 992, 35 S.E. 430; Holland v. Isler, 77 N.C. 1.
2. Is the ordinance discriminative? It is contended that the ordinance in question discriminates between persons of the same class, and makes an arbitrary classification without real ground of difference, and thus violates article 5, § 3, of the Constitution of this state. It has long been held in this state and elsewhere that a tax is uniform and does not discriminate when it is equal upon all persons belonging to the described class upon which it is imposed. Gatlin v. Tarboro, 78 N.C. 121; Burroughs on Taxation, § 77; State v. Worth, 116 N.C. 1007, 21 S.E. 204; State v. Powell, 100 N.C. 525, 6 S.E. 424. The ordinance in question levies the same tax upon all engaged in the business of selling near beer and other similar drinks as beverages containing as much as one-half of one per cent. of alcohol, and it is admitted that near beer contains 1 1/2 per cent. of alcohol and comes within the terms of the ordinance. We think the law is therefore uniform, in that it bears equally upon all who come within its terms and are engaged in the character of business taxed by it.
3. The next question presented by the appeal is whether or not the tax of $1,000 upon the business of selling near beer is unreasonable and prohibitory. The General Assembly of 1909 has recognized and legalized the sale of "near beer" by requiring from those who deal in it an annual license tax for the state of $20 and at least an equal sum for the counties. Section 63, c. 438, p. 676, Pub. Laws 1909. It therefore follows, as is said by the Supreme Court of Georgia in a similar case, that: Campbell v. City of Thomasville, supra. As municipal corporations have no inherent police powers and can exercise only those conferred by the state, it of necessity follows that, in the absence of express charter authority, they cannot directly by taxation prohibit or destroy a business legalized by the state. State v. Dannenberg, 150 N.C. 800, 63 S.E. 946, and authorities cited; 1 Dillon on Mun. Corp. § 89; Cooley on Taxation, 598; Dobbins v. Los Angeles, 195 U.S. 223, 25 S.Ct. 18, 49 L.Ed. 169. The contention here is that the tax destroys it. It appears to be well settled that, unless the power to tax is transcended, the reasonableness or unreasonableness of a tax levied exclusively for revenue is a matter generally within the exclusive province of the legislative department of the state, and is not a matter for the courts, but that, when the license fee is demanded also as a police regulation, the courts will consider whether it is so unreasonable as to amount to a prohibition upon lawful vocations which cannot be prohibited. Tiedeman, Police Powers, p. 277; State v. Hunt, 129 N.C. 688, 40 S.E. 216, 85 Am. St. Rep. 758; Winston v. Beeson, 135 N.C. 277, 47 S.E. 457, 65 L. R. A. 167. The consensus of judicial decision is stated by Smith in his work on Modern Mun. Corp. § 1455: ...
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