State v. Schofield, 20709

CourtLouisiana Supreme Court
Writing for the CourtPROVOSTY, J.
Citation136 La. 702,67 So. 557
PartiesSTATE v. SCHOFIELD et al In re SCHOFIELD
Docket Number20709
Decision Date11 January 1915

67 So. 557

136 La. 702

STATE
v.
SCHOFIELD et al

In re SCHOFIELD

No. 20709

Supreme Court of Louisiana

January 11, 1915


[67 So. 558]

J. S. Atkinson, of Shreveport, Price & Price, of Ruston, and G. W. Hardy and Albert Benoit, both of Shreveport, for applicants.

R. G. Pleasant, Atty. Gen., and Howard B. Warren, Dist. Atty., of Ruston (G. A. Gondran, of New Orleans, of counsel), for the State.

John B. Holstead, District Judge, pro se.

O'NIELL, J., concurs in the decree.

OPINION [67 So. 559]

[136 La. 706] PROVOSTY, J.

The indictment against the accused contains two counts -- one, under section 1 of Act No. 40, p. 47, of 1912, charging that:

'They being itinerant and traveling agents engaged in the sale of stock of the North Louisiana Electric Railway Company, a corporation organized under the laws of the state of Louisiana, did sell five shares of stock' of said corporation.

The other count is under section 4 of said statute, and charges that, in order to induce the purchase of said stock, they made false representations. They were tried without a jury, and were convicted and sentenced each to a fine of $ 50, and their case is before this court on writs of certiorari and prohibition to the trial judge.

By motion to quash, they assailed the validity of said statute on a number of grounds. The said act reads as follows:

'An act levying a license tax on itinerant or traveling agents selling stock and bonds; regulating the sale of such stock and bonds by itinerant or traveling agents or vendors and requiring them to secure a certificate of permission before receiving a license; providing the cost and manner of securing such certificate of permission and license; and providing that bonds and security be given that such stock or bonds are as represented; and providing a penalty for the violation of this act.

'Section 1. Be it enacted by the General Assembly of the state of Louisiana, that every itinerant or traveling agent engaged in the sale of stocks or bonds of any corporation, whether organized in this state or any state or territory, shall before being permitted to make any [136 La. 707] such sales, procure from the secretary of state, at a cost of one dollar a written certificate of permission, which shall entitle him to procure from the sheriff of the parish, in which he proposes to engage in such sale, a license to do so, which license is hereby fixed at the sum of five dollars per annum, and any such agent who engages in such sales, before securing such certificate of permission and before payment of such license in each parish in which he operates, shall be deemed guilty of a misdemeanor and punished as hereinafter provided.

'Sec. 2. Be it further enacted, etc., that each and every itinerant or traveling agent so engaged in the sale of such stock or bonds before securing such certificate of permission as aforesaid, shall file with the secretary of state a sworn statement giving his name, residence and the name and kind of bonds or stock which he proposes to sell, with the par value thereof, as well as a full statement of the domicile and offices of the corporation whose bonds or stock he proposes to sell, and shall therein declare the market value of such bonds or stock with a brief statement of the property owned by such corporation with its location and any such itinerant or traveling agent who shall make any false statement in said affidavit shall be deemed guilty of perjury and prosecuted as such.

'Sec. 3. Be it further enacted, etc., that each of such itinerant or traveling agents shall before securing such certificate of permission, on procuring of any license or making any sales of stock and bonds as hereinbefore referred to give bond in any sum not less than fifteen thousand dollars filed by the secretary of state, and payable to him which bond shall be furnished by a surety company and approved by the secretary of state and the same shall be conditioned that he will make no false statement, or misrepresentation of facts in making such sales of said stock or bonds, the same to continue in full force for a period of two years from date, and any purchaser of stock or bonds from such agent shall have a right of action on this bond to recover any damages caused by any false statement or misrepresentation made by such agent in the sale of such stock or bonds to be recovered before any court of competent jurisdiction in the parish where the sale is made.

'Sec. 4. Be it further enacted, etc., that any such itinerant or traveling agent engaged in the sale of such stock or bonds who shall make any false statement, false representations, or false promise in order to induce any person to buy such bonds or stock and a purchase is made relying thereon, shall be deemed guilty of misdemeanor and on conviction shall be punished as hereinafter provided.

'Sec. 5. Be it further enacted, etc., that each certificate of permission and license shall designate the name of the company whose bonds or stock are being sold under it, as well as the name of the person to whom it is issued and for each separate company or stocks and bonds represented, a separate bond shall be filed and separate certificate of permission and license obtained, and any agent who shall use or attempt [136 La. 708] to use any certificate of permission or license for the sale of stock and bonds not designated therein and not issued to him shall be deemed guilty of a misdemeanor and shall be punished as hereinafter provided.

'Sec. 6. Be it further enacted, etc., that any itinerant or traveling agent as aforesaid, violating the provisions of this act shall be deemed guilty of a misdemeanor and on conviction thereof shall be fined not more than $ 500.00 or imprisoned not more than six months or both at the discretion of the court.'

A question which is more or less involved in several of the grounds of nullity urged against this statute, and which might as well be disposed of now and for all, is whether the license imposed by this statute is levied by an exercise of the taxation power or of the police power.

When a license is required to be obtained for the privilege of carrying on some particular business without any payment being required for obtaining it, the governmental power that is being exercised in the premises cannot possibly be that of taxation, but is necessarily that of police, for the necessary function of the taxation power is to procure revenue. When a payment is required for obtaining the license, the power that is being exercised may be either that of taxation or that of police. If only an amount sufficient to cover the cost of issuing the license is demanded, the power that is being exercised is still plainly that of police. But, if the amount demanded exceeds the cost of issuing the license, the problem becomes more complicated; especially if, as in the present case, this excess is very large, and the cost of obtaining the license is otherwise provided for. [67 So. 560]

In nearly all of the very numerous cases where the courts have had to consider this distinction between a license levied under taxation power and one levied under the police power, the question has come up in connection with the ordinance of some municipality that possessed the power to regulate, but not that to tax, the particular business upon which the license was imposed. [136 La. 709] Hence we generally find the law in that regard stated in the text-books from the standpoint of a municipality, not from that of the Legislature. The question cannot possibly arise in an instance where the acting governmental authority possesses both the power of taxation and that of police, for the license is then valid, even if its purpose be to procure revenue to defray the general expenses of the government. This accounts for its having so seldom arisen in connection with a license imposed by a Legislature; for Legislatures, as a rule, possess both of the said powers in plenitude.

That law on this point is nowhere more fully and lucidly stated than by Judge Cooley in his work on Taxation (page 589), where he says:

'A fee for the license may still be exacted, but it must be such a fee only as will legitimately assist in the regulation; and it should not exceed the necessary or probable expense of issuing the license and of inspecting and regulating the business which it covers. If the state intends to give broader authority, it is a reasonable inference that it will do so in unequivocal terms. But the limitation of the license fee to the necessary expenses will still leave a considerable field for the exercise of discretion where the amount of the fee is to be determined. The fee, of course, must be prescribed in advance, and when it cannot be determined with any accuracy what the cost of regulation is to be. It must therefore be based upon the estimates with more or less probability that the result will fail to come anything near a verification of the calculations. Moreover, in fixing upon the fee, it is proper and reasonable to take into account, not the expense merely of direct regulation, but all the incidental consequences that may be likely to subject the public to cost in consequence of the business licensed. In some cases the incidental consequences are much the most important, and, indeed, are what are principally had in view when the fee is decided upon. The regulation of the business of huckster, for instance, could seldom be troublesome or expensive, but that of the manufacture and sale of intoxicating drinks could not be measured by anything like the same standard. The business is one that affects the public interest in many ways, and leads to many disorders. It has a powerful tendency to increase pauperism and crime. It renders a large force of peace officers essential, and it adds to the expenses of the courts, and of nearly all branches of civil administration. It cannot be questioned,...

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19 practice notes
  • Kintzinger v. Millin, No. 50654
    • United States
    • United States State Supreme Court of Iowa
    • 18 Septiembre 1962
    ...Estates, supra, 286 Ill.App. 184, 3 N.E.2d 132, 137; In re Hill's Estate, 30 Ill.App.2d 243, 174 N.E.2d 233, 235; State v. Schofield, 136 La. 702, 67 So. 557, 564; Bolles v. Toledo Trust Co., supra, 132 Ohio St. 21, 4 N.E.2d 917, 920; Gugle v. Gugle, Ohio App., 78 N.E.2d 585, 587; In re Con......
  • Mouledoux v. Maestri, 36147.
    • United States
    • Louisiana Supreme Court
    • 10 Abril 1941
    ...under the taxing power. Laundry License Case, D. C. 22 F. 701; State v. Grunewald, 123 La. 527, 49 So. 162; State v. Schofield et al., 136 La. 702, 67 So. 557; City of Shreveport v. Brister, 194 La. 615, 194 So. 566; and Monsour v. City of Shreveport, 194 La. 625, 626, 194 So. 569. The two ......
  • Hartman v. Meier
    • United States
    • Idaho Supreme Court
    • 29 Mayo 1924
    ...140, 59 L.Ed. 385; Robinson v. City of Norfolk, 108 Va. 14, 128 Am. St. 934, 60 S.E. 762, 15 L. R. A., N. S., 294; State v. Schofield, 136 La. 702, 67 So. 557; Burroughs on Taxation, chap. 9, par. 77, License Tax; Cooley on Taxation, chap. 19, p. 1139; Glascow v. Rowse, 43 Mo. 479; State v.......
  • Mott v. COMMISSIONER OF INTERNAL REVENUE, Docket No. 71903.
    • United States
    • U.S. Board of Tax Appeals
    • 18 Diciembre 1936
    ...of section 1, prescribing how title may be transferred, is described by the Supreme Court of that state in State v. Schofield, 136 L. 720; 67 So. 557, as The statute does not undertake to prescribe an exclusive mode of evidencing as between the parties a sale of stocks; its object is merely......
  • Request a trial to view additional results
19 cases
  • Kintzinger v. Millin, No. 50654
    • United States
    • United States State Supreme Court of Iowa
    • 18 Septiembre 1962
    ...Estates, supra, 286 Ill.App. 184, 3 N.E.2d 132, 137; In re Hill's Estate, 30 Ill.App.2d 243, 174 N.E.2d 233, 235; State v. Schofield, 136 La. 702, 67 So. 557, 564; Bolles v. Toledo Trust Co., supra, 132 Ohio St. 21, 4 N.E.2d 917, 920; Gugle v. Gugle, Ohio App., 78 N.E.2d 585, 587; In re Con......
  • Mouledoux v. Maestri, 36147.
    • United States
    • Louisiana Supreme Court
    • 10 Abril 1941
    ...under the taxing power. Laundry License Case, D. C. 22 F. 701; State v. Grunewald, 123 La. 527, 49 So. 162; State v. Schofield et al., 136 La. 702, 67 So. 557; City of Shreveport v. Brister, 194 La. 615, 194 So. 566; and Monsour v. City of Shreveport, 194 La. 625, 626, 194 So. 569. The two ......
  • Hartman v. Meier
    • United States
    • Idaho Supreme Court
    • 29 Mayo 1924
    ...140, 59 L.Ed. 385; Robinson v. City of Norfolk, 108 Va. 14, 128 Am. St. 934, 60 S.E. 762, 15 L. R. A., N. S., 294; State v. Schofield, 136 La. 702, 67 So. 557; Burroughs on Taxation, chap. 9, par. 77, License Tax; Cooley on Taxation, chap. 19, p. 1139; Glascow v. Rowse, 43 Mo. 479; State v.......
  • Mott v. COMMISSIONER OF INTERNAL REVENUE, Docket No. 71903.
    • United States
    • U.S. Board of Tax Appeals
    • 18 Diciembre 1936
    ...of section 1, prescribing how title may be transferred, is described by the Supreme Court of that state in State v. Schofield, 136 L. 720; 67 So. 557, as The statute does not undertake to prescribe an exclusive mode of evidencing as between the parties a sale of stocks; its object is merely......
  • Request a trial to view additional results

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