State v. Winehill

• Decision Date: 31 May 1920
• Docket Number: 22,511
• Citation: 147 La. 781,86 So. 181
• Parties: State of Louisiana. v. Winehill & Rosenthal
• Court: Louisiana Supreme Court

86 So. 181

147 La. 781

State of Louisiana. v. Winehill & Rosenthal

No. 22,511

Supreme Court of Louisiana

May 31, 1920

Rehearing Denied June 30, 1920.

Appeal from the Civil District Court for the Parish of Orleans - George H. Theard, Judge.

Suit by the State of Louisiana against Winehill & Rosenthal. From a judgment condemning defendants to pay a license tax, they appeal. Affirmed.

Provosty J., dissenting.

J. P. Baldwin and Lemle & Lemle, all of New Orleans for appellants.

Carl C Friedrichs, of New Orleans, for the State.

O'NIELL, J.

Defendants appeal from a judgment condemning them to pay a license tax of $ 100 a year, for the years 1914, 1915 and 1916, for having engaged in the business of retail dealers in pistols, during those years.

The suit was brought by the tax collector under authority of Act Number 206 of 1908 (p.310). In answer to the rule to show cause why they should not pay the license tax, defendants denied that they had been engaged as retail dealers in pistols during the years 1914, 1915 and 1916. They avered that their business was that of pawn brokers, for which they had paid a license tax amounting to at least $ 375 per annum; that it was their custom, and the custom of the pawnbroker's business generally, to retain goods pawned for loans until redeemed by the borrowers, and, if not redeemed, to sell the goods in satisfaction of the debts which they had been pledged to secure; and that, in every instance in which they had sold a pistol, in the years 1914, 1915 and 1916, the pistol had been pledged or pawned by a borrower, had not been redeemed, and had been sold by defendants merely as an incident of their business as pawnbrokers, to satisfy the debt for which the pistol was pledged.

After the case had been tried and submitted on the issues thus presented, but more than a month before judgment was rendered, the defendants filed an exception of no cause or right of action, avering that, for the reasons specified in their plea, the Act Number 206 of 1908 was unconstitutional.

The district court rendered judgment overruling the exception of no cause or right of action and condemning defendants to pay the license tax sued for, with interest at 2% per month on each $ 100 from March 1, 1914, 1915 and 1916, respectively, and 10% on the total, for the attorney's fee. The only reason assigned by the judge for overruling the exception of no cause or right of action was that he considered that the plea of unconstitutionality of the statute was a matter of defense to be specially pleaded in the answer and that it came too late, after the case had been submitted for decision.

Our opinion is that the reason given by the district judge for overruling the defendants' exception of no cause or right of action was not well founded. Article 346 of the code of practice declares that peremptory exceptions founded on law may be pleaded in every stage of the action, previous to definitive judgment. It is settled by a long line of decision of this court that an exception of no cause or right of action, being a peremptory exception founded on law, may be pleaded at any time before final judgment has been rendered, even in the appellate court. It is also well settled that an exception to the effect that the law under which the plaintiff is proceeding is unconstitutional is in its nature an exception of no cause or right of action. See Veasey v. Peters, 142 La. 1012, 77 So. 948; and Black v. New Orleans Railway & Light Co., 145 La. , 82 So. 83.

It would be illogical to hold that we can not pass upon the merits of the plea of unconstitutionality of the statute in question, merely because the district judge did not pass upon the merits of the plea but overruled it because he thought it was filed too late. If we can consider and pass judgment upon such a plea when filed originally in this court, surely we can consider and pass judgment upon such a plea that was filed in the lower court, even though the lower court's reason for overruling the plea was that he thought it was filed too late. Such a situation is presented in every case in which a district judge refers an exception of no cause or right of action to the merits of the case. Under our system of having broad appeals upon the law and the facts, the question whether the plaintiff has a legal cause or right of action is presented in every case, whether pleaded specially or generally. As was said in Veasey v. Peters, supra, quoting Brown v. Saal, 4 Mart. (N. S.) 437:

"A total want of legal right in a suitor, in relation to the matters in litigation, ought to be taken into consideration and acted on by courts of justice, at any stage of a cause."

Conceding, therefore, as a general rule, that a statute should be deemed valid unless its violation of the constitution has been specially pleaded, it would be unreasonable to hold that, when such plea is the basis of an exception of no cause or right of action, filed in the district court, it cannot be finally disposed of by an appellate court unless or until its merits have been considered and disposed of by the district judge, although such plea might be first considered and disposed of by an appellate court if it was filed originally in the appellate court. In this case, the district judge did dispose of the plea by overruling it; and we are not confined, in our consideration of the plea, to the question whether the district judge's reason for overruling it was a good reason. Having concluded that his reason for overruling the plea was not a good reason, we must determine whether, for any other reason, his decree should be affirmed.

Appellants contend, first, that the Act No. 206 of 1908 is discriminating and denies then the equal protection of the law, in violation of the Fourteenth Amendment of the Constitution of the United States, and, second, that the statute does not grade or graduate the license tax as required by Article 229 of the Constitution of this state. The complaints, specifically, are threefold, viz:

First: Although the statute undertakes to impose the license tax upon all retail pistol dealers whose gross sales annually are less than $ 2,500, and upon those whose gross sales annually are more than $ 2,500, the statute does not impose the tax upon those retail dealers whose gross sales annually are exactly $ 2,500.

Second: Although the statute purports to impose the license tax for a sale of only one article, it does not provide for any lower grade of license than is required of a dealer whose gross annual sales are less than $ 2,500; in conquence whereof, the defendants here, who sold less than a dozen pistols a year, and whose gross sales annually were less than $ 100, are called upon [Pg 4] to pay the same license tax that would be demanded of a retail dealer whose gross sales amounted to $ 2,499 a year.

Third: The second section of the statute expressly exempts from the payment of a license tax dealers in rifles or rifle cartridges of .22 and .25 calibre.

There is a hiatus in the statute, in its failure to declare what the license tax shall be when the gross sales are exactly $ 2,500. The license tax imposed upon retail dealers is graded as follows:

"First Class: When the gross sales are five thousand dollars or more, the license shall be two hundred dollars.

"Second Class: When the gross sales are under five thousand dollars and more than two thousand five hundred dollars, the license shall be one hundred and fifty dollars.

"Third Class: When the gross sales are less than two thousand five hundred dollars, the license shall be one hundred dollars."

It is apparent that either the second class should read, "When the gross sales are two thousand five hundred dollars or more, and less than five thousand," etc., or the third class should read, "When the gross sales are two thousand five hundred dollars or less," etc.

In consequence of the hiatus, it is possible, though not at all probable, by mere chance, that the gross sales of a retail dealer in pistols, pistol cartridges, rifles or rifle cartridges, will, in one calendar year, amount to exactly $ 2,500. If that should ever occur, we may be called upon to decide whether the dealer should be adjudged exempt from the license tax or should be required to pay the minimum tax, required when the gross sales are less than $ 2,500. But there is no occasion for deciding that question in the case before us. There is no showing, nor probability, that any retail dealer in pistols or pistol cartridges, rifles or rifle cartridges, has ever been or will ever be exempted from the payment of the license tax, by reason of the hiatus in the statute. It cannot be said, by reason of the hiatus, that the license tax is not graduated or that the graduation is arbitrary. Nor can it be said, by reason of the hiatus, that the statute is discriminating, or does not afford all persons in the same class or situation the equal protection [Pg 5] of the law. The statute does not deprive any person or class of persons going into the business of retail dealers in pistols, rifles or cartridges, an equal chance -- however slight that chance may be -- of having gross sales amounting to exactly $ 2,500 in any calendar year.

Appellants' counsel rely upon the ruling of this court in State v Southern States Alcohol Mfg. Co., 137 La. 72, 68 So. 217; but we do not consider it applicable to the hiatus in the statute in question. In the case cited, the statute purporting to impose a graduated license tax upon all persons, firms or corporations in a certain business, undertook to graduate the business in twenty grades or classes, according to the gross annual receipts, but failed to impose the tax upon those whose annual receipts were between $ 100,000 and...