State v. Polakow's Realty Experts

• Decision Date: 22 October 1942
• Docket Number: 6 Div. 18,22.
• Citation: 243 Ala. 441,10 So.2d 461
• Parties: STATE v. POLAKOW'S REALTY EXPERTS, Inc. SAME v. STRUMPF.
• Court: Alabama Supreme Court

10 So.2d 461

243 Ala. 441

STATE v. POLAKOW'S REALTY EXPERTS, Inc.

SAME v. STRUMPF.

6 Div. 18, 22.

Supreme Court of Alabama

October 22, 1942

Rehearing Denied Nov. 19, 1942.

Thos S. Lawson. Atty. Gen., and Clarence M. Small, Asst. Atty Gen., for appellant.

Horace C. Wilkinson, of Birmingham, for appellees.

GARDNER, Chief Justice.

We are asked by appellees to strike down Chapter 14, Title 46, Code 1940, originally enacted in 1927, Gen.Acts 1927 p. 335, as in contravention of both the State and Federal Constitutions. The argument, which found favor in the Court below, is based in part upon the theory that the right to earn a livelihood by following the ordinary occupations of life is a fundamental, natural, inherent and inalienable right, sacred and valuable, and fully protected by our fundamental laws.

This principle is of course well supported by the authorities and not here denied. 11 Amer.Jur. Sec. 336. And it must be conceded also that "the common businesses and callings of life, the ordinary trades and pursuits which are innocent in themselves and which have been followed in all communities from time immemorial must, therefore, be free in the United States to all alike upon the same terms". 11 Amer.Jur Sec. 336.

But this universal right is subject to the paramount right of the government as a part of the police power to impose such restrictions as the protection of the public may require. "The right

of reasonable regulation is a modification of the sweeping generalization that every person has a right to pursue any lawful calling." 11 Amer.Jur. Sec. 337. Counsel for appellee concedes in effect the correctness of this principle, but insists that the real estate business is innocent and harmless and not subject to the police power of the State and that any regulatory enactment is founded upon no reasonable basis and is of consequence but an arbitrary exercise of legislative power subject to be condemned by the Courts. 11 Amer.Jur. Section 337.

The essential details of the Statute here under review appear in the opinion of Mr. Justice BROWN and need no repetition here. We would only add thereto some emphasis upon Section 306, Title 46, Code 1940, which has full provisions for a hearing before the commission with compulsory attendance of witnesses. Appellees do not question full protection in this respect, but base their argument upon the theory this real estate business is not subject to legislative regulation.

In support of their insistence we are cited to only one authority which is directly in point, that of the Court of Appeals of Kentucky in Rawles v. Jenkins, 212 Ky. 287, 279 S.W. 350, decided in 1925, wherein the case of Hoblitzel v. Jenkins, 204 Ky. 122, 263 S.W. 764, was overruled which latter decision was rendered by a unanimous Court only the year previous.

Mr. Justice BROWN in his opinion appears to consider that the Courts of North Carolina and Delaware have ruled in accordance with the Kentucky Court of Appeals in Rawles v. Jenkins, supra. But this is an error. The Supreme Court of North Carolina by a sharply divided Court in State v. Dixon, 215 N.C. 161, 1 S.E.2d 521, invalidated a similiar law upon the ground that it violated the State Constitution as a local law and left untouched the question here considered. The Delaware decision in Becker v. State, 7 W.W.Harr. 454, 185 A. 92, 93, as well as the North Carolina case of State v. Harris, 216 N.C. 746, 6 S.E.2d 854, 128 A.L.R. 658, dealt with regulatory statutes concerning an entirely different business with which we are not here concerned.

This observation is likewise applicable to other authorities cited by appellees, among them; Adams v. Tanner, 244 U.S. 590, 37 S.Ct. 662, 61 L.Ed. 1336, L.R.A. 1917F, 1163, Ann.Cas.1917D, 973; Kent Stores v. Wilentz, D.C., 14 F.Supp. 1; Ribnik v. McBride, 277 U.S. 350, 48 S.Ct. 545, 72 L.Ed. 913, 56 A.L.R. 1327; Wolff Packing Co. v. Court of Industrial Relations, 262 U.S. 522, 43 S.Ct. 630, 67 L.Ed. 1103, 27 A.L.R. 1280; Duncan v. City of Des Moines, 222 Iowa 218, 268 N.W. 547; Buehman v. Bechtel, 57 Ariz. 363, 114 P.2d 227, 134 A.L.R. 1374; Bramley v. State, 187 Ga. 826, 2 S.E.2d 647; Richardson v. Coker, 188 Ga. 170, 3 S.E.2d 636; People v. Warden of City Prison, 144 N.Y. 529, 39 N.E. 686, 27 L.R.A. 718; State v. Smith, 42 Wash. 237, 84 P. 851, 5 L.R.A.,N.S., 674, 114 Am.St.Rep. 114, 7 Ann.Cas. 577; New State Ice Co. v. Liebmann, 285 U.S. 262, 52 S.Ct. 371, 76 L.Ed. 747; Williams v. Standard Oil Co., 278 U.S. 235, 49 S.Ct. 115, 73 L.Ed. 287, 60 A.L.R. 596; Replogle v. City of Little Rock, 166 Ark. 617, 267 S.W. 353, 36 A.L.R. 1333.

Reduced, therefore, to the last analysis, so far as authorities are concerned, appellees' insistence is supported only by the Kentucky case of Rawles v. Jenkins, supra. Such is the result of our own investigation as well as the ingenuity and resourcefulness of able and energetic counsel. Of course the mere fact that the Kentucky case stands alone, and as opposed to several other Courts of wide repute, does not suffice as a reason to cast that decision aside. But when we consider the guiding rule as here often stated that the Courts must first be convinced beyond all reasonable doubt that a legislative Act is violative of the Constitution, the decided weight of authority as thus outlined must suffice to give us pause.

We have often adverted to the duty resting upon the Court in questions of this character, more recently in State v. Murphy, 237 Ala. 332, 186 So. 487, 489, 121 A.L.R. 283, wherein it was observed:

"The courts, in the exercise of their power to annul a statute which contravenes the organic law, have uniformly recognized that the power is a delicate one, and to be used with great caution. And it must be borne in mind also that legislative power is not derived from either the State or Federal Constitution. These are only limitations upon power. Apart from the limitations imposed by these fundamental charters of government, the power of the legislature has no bounds, and is as plenary as that of the British Parliament.

"Or to state it differently, all that the legislature is not forbidden to do by the organic law, state or federal, it has full competency to do. And in passing upon the constitutionality of a legislative act, the courts uniformly approach the question with every presumption and intendment in favor of its validity, and seek to sustain rather than strike down the enactment of a co-ordinate branch of the government. All of which is embraced in the simple statement that it is the recognized duty of the court to sustain the act unless it is clear beyond a reasonable doubt that it is violative of the fundamental law."

Counsel for appellees insist "this legislation is typical pressure group legislation", and inform us in brief that in response to such continuous pressure, beginning in 1919 with the National Association of Real Estate Boards, some thirty-three States have enacted regulatory legislation similar to that embraced in our Act of 1927. Of course there is nothing appearing upon the face of this Act suggesting that it was the result of any "pressure group" or that it was not passed by the lawmakers in entire good faith and in the public interest as they so viewed it.

In a number of instances litigation has arisen assailing the constitutionality of such legislation upon the grounds here urged upon us. And with the single exception of the Kentucky case above noted, these Courts have rejected the argument that the lawmakers have no authority to pass such regulatory statutes.

One of the earlier decisions (1919) was by the Supreme Court of California in Riley v. Chambers, 181 Cal. 589, 185 P. 855, 856, 8 A.L.R. 418, which contains a clear statement of the question presented and the conclusion reached as will appear from the following:

"Such being the general scope and outline of the act, a number of objections are made to it. The most important of these is that the act is an unreasonable interference with the right of every citizen to engage in a legitimate and useful occupation. This objection is fundamental, and, if sound, the whole act falls, since its sole primary purpose is to hedge about the pursuit of the vocation of a real estate broker or salesman with certain restrictions. That such vocation is a legitimate and useful one cannot be controverted. Nor can it be controverted that the right to engage in a lawful and useful occupation cannot, in effect be taken away under the guise of regulation. On the other hand, it is equally true that a lawful and useful occupation may be subjected to regulation in the public interest, and that all regulation involves in some degree a limitation upon the exercise of the right regulated. The test is whether or not the limitation imposed is really by way of regulation only; is one whose purpose and effect go no further than throwing reasonable safeguards in the public interest around the exercise of the right. If the limitation is of this character, its imposition is a proper exercise of the police power resident in the Legislature, and whose exercise is one of the latter's most important functions.

"Now, the single primary purpose of the act is to require of real estate brokers and salesmen that they be 'honest, truthful and of good reputation.' All of its provisions, including the requirements of a license, are but incidental to this single purpose and designed to accomplish it. * * *

"Where the occupation is one wherein those following it act as the agents and representatives of others and in a more or less confidential and fiduciary capacity, it certainly can be fairly said that those pursuing it should have in a particular degree the qualifications of 'honesty truthfulness and good...