Case ID: ohio-cc-ns_8/html/0505-01.html
Source: Caselaw Access Project
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Date Created: 2024-08-24T03:29:51.129683

UNREASONABLE LICENSE FEES.
    [Circuit Court of Hamilton County.]
    John C. Uhrlaub v. The City of Cincinnati et al.
    
    Decided, June 12, 1903.
    
      Restraint of Trade—By Imposition of Unreasonable License Fee— Ordinance Requiring Fee from Transient Dealers—Injunction.
    
    An ordinance which imposes a license fee of $300 on temporary stores and transient dealers is invalid, because prohibitive as to some classes, unreasonable as to others, and in restraint of trade.
    It is agreed by counsel for the city and counsel for the plaintiff that the following additional facts are admitted to be true, and are to be taken as a part of the record in this case, to-wit:
    1st. That the plaintiff in this ease was a temporary and transient dealer within the meaning of the statute and ordinance in question in this case, and further, that the plaintiff brought his stock of goods from New York to the city of Cincinnati for the express purpose of opening a temporary store for the sale of the same in the city of Cincinnati, and that he did open said store for the aforesaid purpose.
    2d. It is further admitted that the auctioneer engaged by the plaintiff to sell at auction the goods of the plaintiff in the store opened by the plaintiff, had paid the license fee, and had obtained a license from the city of Cincinnati to act as auctioneer’, and that the city of Cincinnati required the plaintiff to take out a further license for the privilege of opening a “temporary store.”
    3d. That the goods which ai-e described -in the petition of the plaintiff, and which were offered for sale by the plaintiff, as described in the petition, were not in the original packages in which they had been brought from New York to the city of Cincinnati, but that said original packages were broken, and the articles contained in said original packages were taken therefrom, and offered for sale separately.
    
      Brief of Kramer & Kramer for the plaintiff.
    Our contentions are, as follows:
    First. The ordinance, on its face, unjustly discriminates between men in the same business, i. e., for illustration, from the seller of rugs a license fee is exacted, while the seller of agricultural articles in a transient store, goes scot free. The seller of boots and shoes is taxed $300, while he who sells the same articles (using his temporary store to exhibit the samples) is exempt.
    Judge Spear said, in State v. Gardiner, 58 O. S., page 610:
    “Our Bill of Rights prohibits the granting of privileges to one which are denied to others of the same class, and the imposition of restrictions or burdens upon certain citizens, from which others of the same class are exempt. A statute, therefore, which imposes special restrictions or burdens, or grants special privileges under the same circumstances can not be sustained, because it is in contravention of the equal rights guaranteed by the Constitution. The constitutional objection to this statute is that it operates unequally. It imposes the burden of examination and license fee upon certain persons, and exempts others of the same class pursuing the same business in the same way.” See, also, Sipe v. Murphy, 49 O. S., 536.
    Second. Our adversaries seek to sustain this ordinance on the plea that it is a valid exercise of the police power. Many ordinances are sustained under this great blanket power and many hardships have been wrought by a misapplication of the same. It will be noted, however, that the exercise of this power must be reasonable and undiscriminating. If, in the exercise of that power, partiality is evident, or if it savors of class legislation, such exercise is invalid and reprehensible, as is attested literally by thousands of decisions.
    We can not do better than quote Volume 22 of the A. & E. Ene. of L., p. 938:
    “In order that a statute or ordinance may be sustained as an exercise -of police power, the courts must be able to see (1), that the enactment has for its object the prevention of some offense of manifest evil or the preservation of the public health, safety, morals, or general welfare; and (2), that there is some clear, real, and substantial connection between the as-ginned purpose qf the enactment- and the qctual provision^ thereof, and that the latter do in some plain, appreciable and appropriate manner tend toward the accomplishment of the object for which the power is exercised. The police power can not be used as a cloak for the invasion of personal rights or private property, neither can it be exercised for private purposes, or for the exclusive benefit of particular individuals or classes. ’ ’
    Many authorities are referred to/in support of this text; but it is needless to elaborate upon them here. "We quote a few as follows: 108 Cal., 326; 16 Pick. (Mass.), 126; 80 Minn., 58; 109 N. Y., 389; 8 C. C., 665.
    Third. The court will scrutinize this exercise of the police-power with care, for it is the exercise of a purely delegated power by a municipality. Unless such exercise is carefully supervised any constitutional property right may be invaded under the guise of city ordinance, claimed to be passed in the exercise of the police power.
    Fourth. The pretended evils of transient stores can be conjured up only by a fanciful imagination. It is because of these imaginary evils that it is attempted t.o deprive the public of a species of healthy competition.
    Moreover the ordinance itself is indefinite. It does not define a transient dealer.
    Fifth. Therefore it is conceded by counsel for the city that the ordinance applies to any person or company which has a regular established business in the city, and opens temporarily another or other places in the city for the temporary sale of its goods in other localities. Therefore, .if John Shillito & Co. should open temporarily another store for the sale of some of its goods, they would have to pay this license fee or tax of $300. If such would occur, it seems there could be no question but what John Shillito & Co. would in a similar suit as this be relieved on the ground of unreasonableness and discrimination; for while they would be so required, the other houses who would not so temporarily open stores or other places would not be the subject of such an imposition. Who can say if a person opens a store, or other place in a city when he begins business, $90S po^ intend to perpipneptly garry $ gp, He, ©ay possibly intend to remain a short time, a few days, but finds the business justifies a permanent continuance, yet he must pay his $300 before he concludes what he will eventually do; so that under this ordinance the authorities determine in advance whether the party is going to remain a short or long time. The ordinance is therefore arbitrary and unreasonable.
    Sixth. The ordinance is unreasonable and in restraint of trade, as it purports to charge a party nothing if he stays a long while, and a heavy tax if he remains a short time. If he remains a day to sell, or two or three days, he must still pay his $300. It is therefore also' in restraint of trade and void for that reason, for it deprives the community of the benefit of competition.
    Seventh. The act under which this authority is assumed is unconstitutional, for it is in violation of Section 8, Article I, and Section 2, Article IV of the Federal Constitution, and in conflict with Section 2 of Article XII of the Constitution of Ohio.
    It seems to us that some sinister influence and purpose was behind this ordinance and ordinances of this character, and the court should put the seal of condemnation upon them.
    Giffen, P. J.; Swing, J., concurs.
    The ordinance involved in this case is unreasonable, unjust and practically prohibitive in fixing the fee for maintaining a temporary store at the sum of $300, regardless of the amount of goods offered for sale, and of the length of time the business is to be carried on. If the value of the goods is $300 or less, the collection of the prescribed license fee in effect confiscates the goods, and, if the licensee wishes to operate a store for one day only he is charged the same fee as one who desires to maintain it' for the period of a week, a month, or a year.
    The amount of goods on hand, and the success of the venture are both' important factors in determining the length of time that.the store would be kept open. A ready sale of all the goods might terminate the enterprise, or on the other hand, induce the proprietor to purchase other goods and continue it indefinitely. A merchant could • rarely afford to pay the sum of $300 for the privilege of opening a temporary store, and hence this provision of the ordinance operates in restraint of trade. • For these reasons we hold the' ordinance to be invalid, and reverse the judgment of the common pleas court.
    
      Kramer & Kramer, for plaintiff.
    
      Albert H. Morrill, contra.
    
      
       Affirmed by the Supreme Court without report, May 31, 1905.