The Hawaiian gazette., 1911-08-25
REFUND ACT IS
VOID, HE ARGUES
Deputy Aiiorney-Genersl Files
Brief in Merchandise
License Case.

.
That ihe aci 81 the Iast legislature
appfopfia,ing 100000 for refunds Of
merchandise license taxes IS void be-
cause Of defect in its title, that the
act is not q riRhfful subject Of legisla.
ton, and that it Is impossible to carry
out Us provisions because sufficient
money was not appropriated, are reas
sons set forth in brief fled yesterday
by Deputy Attorney.General Il. w. SUIT
ton as TO why Treasurer d. l.. Conkling
should not pay the demands for $685.
0S3.65 which have been made upon him.
In order that an authoritative opin-
ion concerning this matter might be
obtained an agreed statement of facts
in the case of q. II. Smithies against
Treasurer Conkling was recently sub
mitted to the supreme court. The attor-
ney-general's department followed this
up by presenting its brief yesterday.
Claims Exceed Appropriation.
The merchandise license fees were
! paid under the laws of 1897. On June
IA, 1900, the constitution of the United
States was taken to apply to the Terri
tory and in January, 1901, the supreme
court of Hawaii declared the merchan-
| hioS llNCHbt law uHCCnbtlbullOudl.
The last legislature considered that
lit would be righteous act to repay the
amounts and thought $4,000 would
cover them. However, claims were filed
amounting to 500, OS3.65. OF this sum
! $27,616.25 represented the total paid
1 after June IA, 1900, while the licenses
! paid prior to the date when the United
States constitution was made applicable
to the Territory amounted to $25, 467 40.
Claims amounting to $1S,93S.7S out
of the 1000 odd paid after June IA,
! 1900, were assigned to G. E. Smithies,
4 but when he souggt to collect, Treas
urer Conkling refused to pay, claiming
4 that the act authorizing the payment
of 100000 was void.
4 Fatal Defect in Title.
Il The brief filed by Mr.. Sutton yes.
4 terday upholds this view He points
! ont first the defect in the title He
says that the purpose expressed in that
\ title is that only such taxes as were
collected after June IA, 1900, the date
, when the constitution of the United
States applied in Hawaii, are to be re-
Il paid. However, in the body of the act
4 the purpose expressed is to pay all
u amounts.
u 1t is remarked that, assuming that
there exists moral obligation to pay
D back the amounts collected after the
law became unconstitutional, there Ger
tainly is no obligation as to payments
0 before that time. The two things arr
q mentioned together in the act ane
therefore can not be separated Thi,
~ defect makes the act void.
II Not Rightful Subject. =.
In arguing that the matter issnot
rightful subject of legislation Mr. SUIT
;, ton points out that to the extent a
; least of repayment of the moneys col
lected before the law became uneonsti
}, tutional, it is San attempt to diver
public funds to private use witi1oni
any moral obligation or other consid
!, Grafton of public policy to support it. :
He states that at the time the earlier
license are collected the law was il
. perfect harmony with the constitution
Of and laws of the republic and tn,
provisional government.
! 1T is declared that, assuming that thu
legislature could appropriate publ,
money to repay the amounts COLLECTED
!, after the license law became unconsti
l tntional, this present attempt must fai
because there is no separation of tn,
1 two objects of the act.
''The act must be considered as
whole and must be held to be not
L rightful subject of legislation, de
clares the deputy attorney-general. H
!, goes on:
/, No Obligation to Pay.
h - But the assumption just made (tha
so much of the act as seeks to appro
d pirate money for paying back tn
b amounts collected after the license Law
became unconstitutional is rightfu
/. subject of legislation), is not true il
q fact. There must be some obligation
}. either legal or moral, to justify thi
diversion of public funds
4 II Mr.. Sutton can find no legal obliga
o tion, for not only is there the bar o
! the statute Of limitations but, besides
|. no protest of this tax was ever made
he says.
f Nor is there even moral obligation
to pay the amounts, he declares
! l'tThose who paid the taxes receives
n benefits to the amount of the tax b,
!. inereased sales, or increased prices, AM
by elimination of competition iron
others who, but for the necessity o
paying a similar license tax, Nigh
have engaged in the same business"
People, Not Merchants, Suffered
A strong point brought out by Nj
i. Sutton is that il was not the merchant
\ who paid the taxes who suffered, bu
j the people who bought the goods fror
the merchants, for the people wer
compelled to pay higher prices to cove
the amount of the taxes. If n mora
obligation to pay anyone exists it
Q TO pay the people generally, and tn
!. people have been repaid, theoretical
Q at least. by the government IS gain. 70
It these reasons we submit that the ae
10 is not rightful subject OF legislI
I, tion.p
y 1t Is further pointed out that the &C
II did not pass three readings in eae
o house, as required by the Organic Ac
j.. -sa.4-a.--
- PRINCIPAL MCCLUSKEY