Wallace v. City of Reno

• Decision Date: 01 August 1903
• Citation: 73 P. 528,27 Nev. 71
• Parties: WALLACE v. MAYOR, ETC., OF THE CITY OF RENO.
• Court: Nevada Supreme Court

73 P. 528

27 Nev. 71

WALLACE v. MAYOR, ETC., OF THE CITY OF RENO.

Supreme Court of Nevada

August 1, 1903

Syllabus by the Court.

1. The people, and through them the Legislature, have supreme power in all matters of government, where not restricted by constitutional limitations.

2. Section 20, subd. 8. of the act incorporating the town of Reno, approved March 16, 1903, and sections 1 and 3 of the act empowering city and other boards to revoke and discontinue business licenses, approved March 10, 1903, are not repugnant to any provision of our state or federal Constitutions; and under them, at the instance of a member and by unanimous consent of the board, a license may be revoked without notice to the licensee, where there is reason to believe that the business is a nuisance, a menace to public health, or detrimental to peace or morals.

Application of W. L. Wallace for a writ of review and stay of proceedings against the mayor and city council of the city of Reno. Demurrer to petition sustained.

Leishman & Hummel, for petitioner.

E. L Williams, City Atty., for respondents.

TALBOT J.

Among other things, the petitioner alleges that on the 15th day of May, 1903, he paid for and received a license from the city of Reno to conduct the business of retail liquor dealer for the period of three months; that on or about the 3d day of last June he received a request from the respondents to attend a meeting on the same evening, and to give them all the information he possessed relative to an alleged charge that he was conducting his business in such a manner as to be a nuisance, or detrimental to public peace or morals; that he complied with this request, and stated he would do all he could to protect his patrons; that later, and on or about the 3d day of June, he was served with a citation issued by the respondents, ordering him to appear before the council on the 4th day of June, and show cause why his license should not he revoked; that the citation did not state the grounds upon which it was proposed to revoke the license; that no due and legal proceedings or investigation were had, and no evidence relevant, competent, or material was introduced tending to prove the truth of the charge; that the council then adjourned until June 6th, at 6 p. m., when, on motion, the license of petitioner was revoked, withdrawn, and discontinued; that during the investigation respondent Luke stated that he had received information relative to the charge at a time other than their regular open meeting, but when sworn as a witness on behalf of petitioner he refused to divulge the names of his informants. It is further asserted in the petition that respondents acted in excess of their jurisdiction because their proceedings were arbitrary, and petitioner did not have an opportunity to make a fair, full legal, and complete defense to the charge; and, further, that they had no legal power or authority to conduct such investigation, or to issue citation to petitioner, or to revoke his license, unless upon a complaint or petition being first filed with them.

Respondents demur to the petition on the ground that it fails to state sufficient facts in different respects.

We deem it necessary to consider only one of the objection raised, as that goes to the merits and is conclusive. It may be assumed from the allegations of the petition, and it was conceded on the argument, that the city council voted unanimously in favor of revoking the license.

Section 20, subd. 8, of the act incorporating the city of Reno (St. 1903, p. 189), specifies that the city council shall have power "to fix and regulate a license upon, and regulate all characters of business conducted within the corporate limits, and to license, regulate, prohibit or prescribe the location of saloons or barrooms." Sections 1 and 3 of an act approved March 10, last (St. 1903, p. 81), authorizes all city councils and licensing boards "to revoke, withdraw and discontinue any business license, where there is reason to believe that such business is a nuisance, a menace to public health or detrimental to the peace or morals: provided, that such revocation, withdrawal or discontinuance shall, when the action is taken on motion of, or at the instance of a member of the board, be by unanimous consent." This language does not suggest any notice to the licensee, and, so far as the statute is concerned, it is apparent that none is necessary when the license is revoked on the motion of a member and by unanimous vote of the board, and that they may act ex parte and arbitrarily, and the only protection to the innocent holder of a license lies in the unanimity required for its revocation, and in the honesty, confidence, and efficiency of the members of the board as public officials, and the probability that it would be restored upon a showing that it had been unjustly or improperly annulled. Regardless of the requirements and validity of the statute, it is fairer and better that notice be given as was done in this case. By appearing the petitioner waived notice, but, as he objects to the sufficiency of the citation, we prefer to treat the case on the merits, and as if there had been no notice or appearance.

Section 2 of the act last mentioned provides another method of revocation, and for an investigation by the board, on the petition of a taxpayer, supported by 10 per cent. of the freeholders, but is also silent regarding notice to the licensee.

It becomes pertinent to determine whether the petitioner has a vested or contract right in his license, of which he cannot be deprived without formal process of law by the Legislature, or the city council through those statutory enactments, under the fifth amendment to the Constitution of the United States, providing that no person shall be deprived of life, liberty, or property without due process of law, or under the limitations of our state Constitution. In the latter document, section 2 of article 1 proclaims the fundamental truth that all political power is inherent in the people, that government is instituted for their protection, security, and benefit, and that they have the right to alter and reform the same whenever the public good may require. Section 20 of article 4 prohibits the Legislature from passing local or special laws for the assessment and collection of taxes, and article 10 requires the Legislature to provide for a uniform and equal rate of assessment and taxation and for a just valuation of all property. As held by this court in Ex parte Robinson, 12 Nev. 263, 28 Am. Rep. 794, and Ex parte Cohn, 13 Nev. 427, these limitations apply to taxes, and not to licenses, leaving the Legislature to regulate the latter with a free hand where they do not encroach and discriminate in relation to taxes as properly and ordinarily understood, and without other restraint except the responsibility of the legislators to their constituents.

Questions kindred to the main one here have been carefully considered by a number of courts in our sister states, and by the Supreme Court of the United States, and the reasoning and conclusions reached are peculiarly applicable and convincing.

In State v. Schmidtz, 65 Iowa, 556, 22 N.W. 673, this language is used in the decision: "The law under which the permit was issued provides in express terms that if the defendant sold liquors for unlawful purposes the permit should be revoked. He received and accepted the permit under such condition. He was not, therefore, deprived of property when the permit was revoked. Hurber v. Baugh, 43 Iowa, 514. Therefore it cannot be said that the defendant has been deprived of property without due process of law."

We quote extensively from La Croix v. County Commissioners, 49 Conn. 591:

"The present complainant insists that the General Assembly have no more power to confer the jurisdiction mentioned upon the county commissioners as a board than they have to confer the same jurisdiction upon them as a court, because he claims that his license is a contract between him and the state, vesting in him the right from the 2d day of November, 1881, until the 31st day of October, 1882, to sell intoxicating liquors in his saloon at Westport, unless during that period he has violated or shall violate some provision of the laws in relation to such liquors, and shall be convicted of such violation in due course of law. And he also insists that his license is property for which he has paid a valuable consideration, and of which be cannot be deprived but by the judgment of a court of competent jurisdiction upon the verdict of a jury. There is a clear preponderance of authority in support of the doctrine that licenses like that of the complainant are not contracts between the state and the parties licensed, and are not property in any constitutional sense. They form, moreover, a part of the internal police system of the state, are granted in the exercise of the police power which is inherent in every sovereignty, and cannot in any manner be alienated, and may at any time be revoked by legislative authority.

"In the case of Calder v. Kurby, 5 Gray, 597, a license to sell intoxicating liquors had been granted for a certain period. Before the period had expired the license was annulled.

It was urged upon the argument in behalf of the plaintiff that the license was a contract and within the protection of the Constitution of the United States. But the court overruled the claim. Mr. Justice Bigelow in giving the opinion says 'The whole argument of the counsel for the plaintiff is founded on a fallacy. A license authorizing a person to retail spirituous liquors does not create any contract between him and the government. It bears no resemblance to an act of incorporation, by which, in...