State v. Packer Corp.

• Decision Date: 07 April 1931
• Docket Number: 5036
• Citation: 297 P. 1013,77 Utah 500
• Court: Utah Supreme Court
• Parties: STATE v. PACKER CORPORATION

297 P. 1013

77 Utah 500

STATE v. PACKER CORPORATION

No. 5036

Supreme Court of Utah

April 7, 1931

Appeal from District Court, Third District, Salt Lake County; D. W Moffat, Judge.

The Packer Corporation was convicted in the city court of Salt Lake City of displaying a cigarette advertisement on a billboard contrary to Laws 1921, c. 145, § 2, as amended, but, on appeal to the district court, the action was dismissed, and the State appeals.

REVERSED.

Geo. P Parker, Atty. Gen., and Byron D. Anderson, Deputy Atty. Gen for the State.

Dan B. Shields, of Salt Lake City, and W. H. Reeder, Jr., of Ogden, for respondent.

FOLLAND, J. CHERRY, C. J., and EPHRAIM HANSON, J., concur. STRAUP, J., ELIAS HANSEN, J., dissenting.

OPINION

FOLLAND, J.

This is a prosecution by the state, commenced in the city court of Salt Lake City. The complaint charged the defendant with committing the crime of violating section 2, c. 145, Laws Utah 1921, as amended by chapter 52, Laws Utah 1923, and as amended by chapter 92, Laws Utah 1929, as follows:

"That the said Packer Corporation, at said time and place did display on a bill board owned and operated by the defendant, an advertisement of Chesterfield Cigarettes by displaying a representation of a package of Chesterfield Cigarettes with the words, 'Chesterfield Cigarettes, They Satisfy.' contrary to the provisions of the Statute," etc.

The defendant interposed general and special demurrers on the grounds, among others, that the facts stated in the complaint did not constitute a public offense, and that the statute upon which the complaint is based violates the provisions of article 1, § 1, of the Constitution of Utah, with respect to the inherent and inalienable right of defendant to acquire, possess, and protect its property, of article 1, § 7, with respect to deprivation of property without due process of law, of article 1, § 18, with respect to impairing the obligation of contracts, of article 1, § 24, relating to uniform operation of all laws of a general nature, and as being in conflict with article 1, § 8, of the Constitution of the United States, relating to interstate commerce, with article 1, § 10, respecting impairing of the obligations of contracts, with article 4, § 2, respecting the privileges and immunities of citizens in the several states, and the Fourteenth Amendment of the Constitution of the United States respecting the deprivation of property without due process of law, and/or respecting the denial to persons within the jurisdiction of the state of Utah of the equal protection of the laws.

In the city court the defendant was found guilty, but, upon appeal to the district court, the demurrer was sustained, and, the state refusing to amend, the action was dismissed. The state appeals.

The validity of the act is defended by the state upon the ground that it is a proper and legitimate exercise of the police power of the state, and that the act in no particular offends against any of the constitutional provisions of the state or of the United States.

The provision with respect to advertising cigarettes and tobacco on billboards is section 2, of chapter 52, Laws Utah 1923, as amended by chapter 68, Laws Utah 1925, and by chapter 92, Laws Utah 1929 (further amended by chapter 5, Laws Utah 1930 [Sp. Sess.], after this action was commenced, but which does not change the situation as to the particular question involved), which section is as follows:

"It shall be a misdemeanor for any person, company, or corporation, to display on any bill board, street car sign, street car, placard, or on any other object or place of display, any advertisement of cigarettes, cigarette papers, cigars, chewing tobacco, or smoking tobacco, or any disguise or substitute of either, except that a dealer in cigarettes, cigarette papers, tobacco, or cigars or their substitutes, may have a sign on the front of his place of business stating that he is a dealer in such articles, provided that nothing herein shall be construed to prohibit the advertising of cigarettes, cigarette papers, chewing tobacco, smoking tobacco, or any disguise or substitute of either in any newspaper, magazine or periodical printed or circulating in the State of Utah."

The act of which this advertising feature is a part is for the regulation and restriction of the sale, use, and advertising of cigarettes and tobaccos, and includes the following:

(1) The licensing of cigarette dealers by cities, towns, and counties upon payment of a license fee.

(2) The imposition of a tax to be paid to the state upon all packages of cigarettes sold.

(3) Prohibiting the advertising of cigarettes and tobaccos on bill boards, placards, and in street cars.

(4) Prohibiting the sale or furnishing of cigarettes or tobaccos to minors under 21 years of age.

(5) Making it unlawful for proprietors of places of business to knowingly permit minors under 21 years of age to frequent such places while using tobacco in any form.

(6) Vesting power in the licensing authority to revoke the license of any dealer for violation of the act; no new license to be granted such dealer within two years after such revocation.

(7) Regulations with respect to the tax feature, looking to the collection of the stamp tax.

It is apparent from the act itself, as well as from the history of the legislation on the subject, that the purpose of the act was to regulate and restrict the sale and use of cigarettes and tobacco. In chapter 145, Laws Utah 1921, p. 390, the Legislature prohibited the sale of cigarettes and cigarette papers within the state and also prohibited smoking of tobacco in public places and the advertising of tobacco in any form. Because of the widespread use of cigarettes, the law was unpopular and difficult, if not impossible, of enforcement. The Legislature in 1923 repealed all but one section of the 1921 law, and enacted substantially the present law. It is evident the intent of the Legislature was a relaxation merely, and not an abandonment of its policy of restriction. As an incident and as a more efficient means of regulation, the act requires payment, of a license fee by dealers, and the payment of an excise tax on cigarettes. The fact that a considerable revenue is raised and paid into the public treasury does not itself indicate that the act was passed as a revenue measure, nor destroy its character as a regulatory act passed in the exercise of the police power, where the object is to control, regulate, and restrict, rather than to encourage, the traffic. 15 R. C. L. 288; 26 R. C. L. 17; Town of Phoebus v. Manhattan Social Club, 105 Va. 144, 52 S.E. 839. That the act is regulatory in its nature and purpose is shown by the fact that, in addition to the imposition of the stamp tax, it requires a license and payment of a license fee, prohibits sales to minors under 21, and smoking by minors in stores, shops, and other places, restricts the advertising of cigarettes and tobaccos, and grants power to the licensing power to revoke or refuse licenses in the event of violation of any of the provisions of the act.

A police regulation presupposes a condition which, unless restricted, guarded, and controlled, will operate to public disadvantage. The courts have held, without exception, that the state, in the exercise of the police power, may license, tax, and regulate the sale and use of cigarettes and tobacco and may go so far as to prohibit the traffic entirely.

In Gundling v. Chicago, 176 Ill. 340, 52 N.E. 44, 48 L.R.A. 230, it was held that an ordinance regulating the sale of tobacco in one of its forms, i. e., cigarettes, was a health and welfare measure within the exercise of the police power. This case was affirmed on appeal to the United States Supreme Court in 177 U.S. 183, 20 S.Ct. 633, 636, 44 L.Ed. 725, wherein it was said:

"The amount of the fee is fixed by the common council for the privilege of doing business, and the text of the ordinance and the amount of the fee therein named would seem to indicate that it is both a means adopted for the easier regulation of the business and a tax in the nature of an excise imposed upon the privilege of doing it. In either case the state has power to make the exaction, and its exercise by the city under state authority violates no provision of the Federal Constitution. * * *

"It is not a valid objection to the ordinance that it partakes of both the character of a regulation and also that of an excise or privilege tax. The business is more easily subjected to the operation of the power to regulate where a license is imposed for following the same, while the revenue obtained on account of the license is none the less legal because the ordinance which authorized it fulfills the two functions, one a regulating and the other a revenue function. So long as the state law authorizes both regulation and taxation, it is enough, and the enforcement of the ordinance violates no provision of the Federal Constitution."

In Austin v. State, 101 Tenn. 563, 48 S.W. 305, 50 L.R.A. 478, 70 Am. St. Rep. 703, the court held that cigarettes are not a legitimate article of commerce. This case went to the Supreme Court of the United States, and that court, while holding that the cigarette was a legitimate article of interstate commerce, also held that it was, however, to the same extent as intoxicating liquors, subject to regulation under the police power of the state. The court said:

"Cigarettes do not seem until recently to have attracted the attention of the public as more injurious than other forms of tobacco; nor are we now prepared to take judicial notice of any special injury resulting from their use or to indorse the opinion of the supreme court of Tennessee that 'they are inherently bad...