Case ID: misc_48/html/0159-01.html
Source: Caselaw Access Project
Author: {"author": "Fitzgerald, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

People ex rel. Patrick Laughran, Relator, v. William Flynn, as Warden, etc., Respondent.
    (Supreme Court, New York Special Term,
    August, 1905.)
    Habeas corpus — Hearing and determination — Return showing jurisdiction— Dismissal — Constitutional law — Deprivation of property without due process — Liquor tax certificate how far “property” — L. 1905, ch. 697, not unconstitutional.
    Where a return to a writ of habeas corpus, consisting merely of a commitment regular in form, directing that relator be held to answer to the Court of Special Sessions in the city and county of Hew York for a violation of the Liquor Tax Law, shows upon its face that the magistrate had jurisdiction to commit, the writ must be dismissed.
    While liquor tax certificates issued under the present law have characteristics and value which did not attach to excise licenses under former statutes, they are “ property ” only in a qualified and restricted sense.
    Chapter 697 of the Laws of 1905, providing for the revocation of any hotel liquor.tax certificate which has been issued for a place which “ does not comply with the provisions of the liquor tax law as to hotels ”, is not unconstitutional for failure to provide for notice of all proceedings thereunder to holders of liquor tax certificates issued before its enactment; nor is a revocation of such certificate for a violation thereof a deprivation of property without due process of law.
    A liquor tax certificate, assuming it to be a contract between the State and the holder, confers certain rights for the term of one year, only upon the implied condition that the statute remains in force for that period; and the claim that said act of 1905 tends to impair the obligations of a contract is, therefore, untenable.
    Application for a writ of habeas corpus to be released from detention upon the charge of having trafficked in liquor at No. 2353 Third avenue New York city, without any liquor tax certificate in the premises other than one which had been duly revoked under the provisions of the Liquor Tax Law.
    Julius M. Mayer, Attorney-General (William E. Schenck, H. H. Kellogg and S. B. Mead, counsel by courtesy), for State Commissioner of Excise.
    William T. Jerome, district attorney, for respondent Flynn.
   Fitzgerald, J.

For return respondent submits a commitment, regular in form, directing that relator be held to answer to the Court of Special Sessions for a violation of the Liquor Tax Law. From the face of this paper it appears that the magistrate had jurisdiction to commit. This return would require a dismissal of the writ. A statement purporting to be a traverse, however, has been filed, which sets forth facts, admitted to be true, by which it is established that relator was the holder of a liquor tax certificate issued prior to the passage of chapter 697 of the Laws of 1905; that after this enactment (acting under one of its provisions) his certificate was revoked by the special deputy commissioner of excise for the boroughs of Manhattan and the Bronx, upon the report of the superintendent of buildings, and that such proceeding was without notice to him. It is claimed that the revocation so made was void in law, and that the act authorizing it is unconstitutional, in that it fails to provide for notice to holders, and assumes to deprive them of property without a hearing, or, in other

words, “ without due process of law.” It is true that under the statute at present regulating traffic in liquors tax certificates have been held to have characteristics and value which did not attach to excise licenses under former laws (McNeeley v. Welz, 166 N. Y. 124), but when they are referred to as property it is manifest that the term is applied in a qualified and restricted sense. It cannot be seriously contended but that in the exercise of the police power regulations may be adopted involving the destruction of property without compensation to the owners. Cooley Const. Lim. (5th ed.) 721; Wynehamer v. People, 13 N. Y. 378. The Legislature could repeal the act and every privilege granted under it would cease; property interests might suffer, but in a legal sense no property right would have been invaded, for, as was said in People ex rel. Einsfeld v. Murray, 4 App. Div. 185; affd., 149 N. Y. 367: It would be inherently and essentially an exercise of the police power of the State.” If, then, without notice, every substantial privilege may be revoked by repeal, it would be difficult to hold (for the sole reason that notice is not required to be given of all proceedings taken under it) that a provision purely remedial in character is repugnant to the fundamental law. It is also claimed that the act tends to impair the obligations of a contract, but that position is untenable, for the reason that, assuming the certificate to constitute a contract between the State and the holder, it was only such contract as the parties thereto were capable of making. If it gave the holder certain rights for the term of one year it was only upon the implied condition that the act remained in force for that period. Matter of Hilliard, 25 App. Div. 222. If the certificate was obtained by false material statements relator was never the holder of a valid tax certificate (People ex rel. Ochs v. Hilliard, 81 App. Div. 71; affd., 178 N. Y. 582), and the State, upon discovery of the misrepresentations, would be entitled to rescind. If otherwise, the proof thereof would be a perfect defense upon a trial. In determining this important question of constitutionality I do not desire to be understood as expressing any opinion upon the general features of this very drastic act, as I have only considered such provisions thereof as were material to the single issue presented. In the language of an authority of the highest repute: “ The constitutional and unconstitutional features may even be contained in the same section and yet be perfectly distinct and separable, so that the first may stand and the last fall.” Cooley Const. Lim. (7th ed.) 247. Upon the return and all the papers submitted the writ allowed herein must, for the reasons assigned, he dismissed.

Writ dismissed.