State v. Skinner

• Citation: 20 Ala.App. 204,101 So. 327
• Decision Date: 22 July 1924
• Docket Number: 6 Div. 496.
• Parties: STATE v. SKINNER.
• Court: Alabama Court of Appeals

101 So. 327

20 Ala.App. 204

STATE v. SKINNER.

6 Div. 496.

Court of Appeals of Alabama

July 22, 1924

Rehearing Denied Aug. 19, 1924.

Appeal from Circuit Court, Jefferson County; William E. Fort, Judge.

Ross Skinner was indicted on a charge of selling speculative securities. From a judgment sustaining demurrer to the indictment and discharging the defendant, the State appeals. Reversed and remanded.

p>Page Harwell G. Davis, Atty. Gen., and James Davis Sol. Tenth Judicial Circuit, Willard Drake and L. Herbert Etheridge, Asst. Sols., all of Birmingham, and W. C. Oates, Executive Officer of State Securities Commission of Montgomery, for the State.

Henry Upson Sims, of Birmingham, amicus curiæ.

Weatherly Birch & Hickman, Nesmith & Garrison, and Black & Harris, all of Birmingham, for appellee.

SAMFORD J.

The only questions involved in this appeal depend upon the validity of an act of the Legislature, approved October 1 1920. Acts 1920, p. 60 et seq. Being in doubt as to some of the questions raised by the rulings of the trial court, this court submitted to the Supreme Court the following inquiries:

(1) Is the act above referred to in violation of section 45 of the Constitution?

(a) Are there two major subjects embraced in the title to the act?

(b) Is the substance of the act clearly expressed in the title so as to meet the requirements of the Constitution?

(2) Are the definitions defining fraud so vague and indefinite as to be void in that an indictment based thereon fails to give to the defendant the nature and cause of the accusation against him as is provided by section 6 of the Bill of Right?

To which the Supreme Court [per Miller, J.] replied as follows:

"Response to Certified Questions from Court of Appeals.

"That part of section 45 of the Constitution of 1901, pertinent to the foregoing questions, propounded by the judges of the Appellate Court, reads as follows: 'Each law shall contain but one subject, which shall be clearly expressed in its title.'

The original act (Gen. Acts 1919, p. 946), and the amendatory act (Gen. & Loc. Acts, Sp. Sess. 1920, p. 60), contain the same title, which reads as follows: 'To prevent frauds and impositions upon the people of the state and to protect investors.'

"The title of an act must announce clearly the subject thereof but no standard of particularity is prescribed by the Constitution, except the title must contain one subject, clearly expressing the one subject of the act. This title is short, general and comprehensive, which deserves the commendation, rather than the condemnation of the courts. It is all expressed in one sentence. The main design of the act, apparent from the title, is to prevent frauds and impositions upon the people of the state, and to aid in protecting them in their investments. To prevent frauds and impositions, and to protect investors from them, is its meaning. The investors in this state are intended by the act to be protected by preventing frauds and impositions upon them, as the title indicates. This title of the act contains only one major subject, which puts it in harmony with section 45 of the Constitution, in so far as it applies to the title thereof. State v. Sayre, 118 Ala. 1, 24 So. 89; Ex parte Pollard, 40 Ala. 77; State v. Street, 117 Ala. 203, 23 So. 807.

"Does the body, the substance of the act, contain one subject which is clearly expressed in the title, as this section of the Constitution requires? The original act and the amendment thereof, creates the state securities commission, designates its members, and locates its office and place of business. The members of the commission are changed by the amendment from those in the original act. The members, by the amendment, of the commission are the members of the Alabama public service commission. The amendment act then defines the term 'securities,' and the term 'speculative securities,' as used therein. It provides the mode and the manner to secure permit from the commission to sell or offer for sale speculative securities. It makes it unlawful for any person, copartnership, association, or corporation, either as principal, or through brokers or agents, or for any broker, agent, or other person, to sell or offer for sale in this state, by means of any advertisement, circular, or prospectus, or by any other form of public offering, any speculative securities, unless there shall have first been issued a permit to do so by the president of the commission as the act requires. This act in section 13 provides that any person, partnership, association, or corporation, who shall commit in this state any act declared unlawful by sections 3, 5, 8, or 10 of the act, shall be deemed guilty of a felony, and on conviction the punishment is fixed by the act. The act outlines the duties of the commissioners, provides any one dissatisfied with the findings of the commission may bring suit in the circuit court of Montgomery county against the commission to set aside such findings on the ground 'that said findings are unjust or unreasonable.' And other matters are mentioned and provided in the act, not necessary to be referred to here.

"The act in its body purports and designs to regulate the sale, or offers to sell to the public in the state of Alabama, speculative securities. The title informs us that the act, in its body, would be framed for the purpose of preventing frauds and impositions upon the people, and to protect investors. The civil and criminal arms of the state are necessary to prevent frauds and impositions upon the public in speculative securities, and to protect the public in the purchase of them. This is the only subject, general subject, dealt with in the body of the act.

"All the foregoing matters mentioned in the act are germane to its title, and can be classed under that one general subject. A commission, with power, authority, and civil procedure for investigating into the value and nature of speculative securities, is proper and natural under the title for the prevention of frauds and impositions on the people of the state, and for the protection of investors therein. A penalty for the violation of the act is not only cognate to the subject, but is really necessary to aid in accomplishing the purpose of it, which is intended to prevent frauds and impositions, and to protect investors from them. Flowers v. State, 168 Ala. 150, 53 So. 276; State v. Twining, 73 N. J. Law, 683, 64 A. 1073, 1135; Thompson v. Akin, 81 Ill.App. 62.

"The act creates a commission to examine into, on proper application, the speculative securities desired to be sold, and to permit or deny the right to sell them; and it provides a penalty for those who sell or offer for sale such securities in the manner denounced by the statute, without the permit from the commission; and it defines speculative securities. These and other provisions in the act are necessary, and proper, germane, and cognate to the design and purpose intended by the title to prevent fraud and impositions upon the people, and to protect investors in the purchase of speculative securities. Darrington v. State, 162 Ala. 60, 50 So. 396; Ham v. State, 156 Ala. 645, 47 So. 126; Lovejoy v. Montgomery, 180 Ala. 473, 61 So. 597, and authorities, supra.

"There are other provisions in the act, but we need not discuss and consider them, as their determination is unnecessary in the case now pending in the appellate court, in which the questions are propounded. Under the foregoing authorities we must hold and answer that the substance, the body of the act, contains only one subject as outlined herein, which is clearly expressed in the title to the act, and meets the requirements of section 45 of the Constitution.

"Section 2 of the amended act gives eight separate and distinct definitions of the term 'speculative securities,' and the act makes it a criminal offense to sell or offer for sale any speculative securities in the manner denounced by the statute, unless a permit shall have been issued by the commission allowing it. Robertson v. Business, etc., Club, 210 Ala. 460, 98 So. 272.

"Do these definitions violate section 6 of the Bill of Rights in the Constitution of 1901, which entitles the defendant to be informed of 'the nature and cause of the accusation'? Are all or any of these definitions of 'speculative securities' so vague and indefinite as to be void, under section 6 of the Bill of Rights in the Constitution, because an indictment based thereon would fail to give the accused the nature and cause of the accusation against him? This is really the...