Source: https://caselaw.findlaw.com/us-supreme-court/308/132.html
Timestamp: 2019-04-21 15:39:44+00:00

Document:
Appeal from the District Court of the United States for the Eastern District of Kentucky. [308 U.S. 132, 133] Messrs. Norton L. Goldsmith, of Louisville, Ky., and Ira Howell Ellis, of Boston, Mass., for appellant.
Messrs. H. Appleton Federa and M. B. Holifield, both of Frankfort, Ky ., for appellees.
Since March 1933 appellant, an Indiana corporation, has continuously received whiskey from distillers in Kentucky for direct carriage to consignees in Chicago. It has permission under the Federal Motor Carrier Act, 1935,1 to operate as a contract carrier, and claims the right to transport whiskey as heretofore, notwithstanding inhibitions of the Kentucky Alcoholic Beverage Control Law approved March 7, 1938.2 By this proceeding it [308 U.S. 132, 134] seeks to restrain officers of the State from enforcing the contraband and penal provisions of that enactment.
The bill charges that to enforce the Control Law would impair appellant's rights under the Commerce Clause, Federal Constitution, U.S.C. A.Const. art. 1, 8, cl. 3, and deprive it of the Due Process and Equal Protection guaranteed by the Fourteenth Amendment. The District Court- three judges sitting-sustained a motion to dismiss. 24 F.Supp. 924. A direct appeal brings the matter here.
The Statute is a long, comprehensive measure (123 sections) designed rigidly to regulate the production and distribution of alcoholic beverages through means of licenses and otherwise. The manifest purpose is to channelize the traffic, minimize the commonly attendant evils; also to facilitate the collection of revenue. To this end manufacture, sale, transportation, and possession are permitted only under carefully prescribed conditions and subject to constant control by the state. Every phase of the traffic is declared illegal unless definitely allowed. The property becomes contraband upon failure to observe the statutory requirement and whenever found in unauthorized possession.
Section 53 declares to be contraband: '(2) Any spirituous, vinous or malt liquors in the possession of any one not entitled to possession of the same under the pro- [308 U.S. 132, 135] visions of this Act.' 4 Peace officers are authorized to seize such contraband and institute proceedings for forfeiture.
Licenses are authorized, sec. 18(1)-(9)5 for distillers, rectifiers, vintners, wholesalers, retailers, and, sec. 18(7)6 for the transportation of liquors to and from any point in the state. Privileges which may be exercised under these are definitely set out.
A license may only issue, sec. 33,12 upon an application which incorporates, sec. 36(5),13 a promise that 'the applicant will in all respects and in good faith conscientiously abide by all the provisions of this Act and of any other Act or ordinance relating to alcoholic beverages' etc. Also, sec. 37,14 there must be a bond 'conditioned that such applicant, if granted the license sought, will not suffer or permit any violation of the provisions of this Act' etc.
Having been denied a Common Carrier's Certificate, appellant sought and was refused a transporter's license because it held no such certificate.
The Twnenty-first Amendment sanctions the right of a state to legislate concerning intoxicating liquors brought from without, unfettered by the Commerce Clause. Without doubt a state may absolutely prohibit the manufacture of intoxicants, their transportation, sale, or possession, irrespective of when or where produced or obtained, or the use to which they are to be put. Further, she may adopt measures reasonably appropriate to effectuate these inhibitions and exercise full police authority in respect of them. Clark Distilling Co. v. Western Maryland Ry. Co., 242 U.S. 311, 320 , 37 S.Ct. 180, 182, L.R.A.1917B, 1218, Ann.Cas. 1917B, 845; Crane v. Campbell, 245 U.S. 304, 307 , 38 S.Ct. 98, 99; Seaboard Air Line Ry. v. North Carolina, 245 U.S. 298, 304 , 38 S.Ct. 96, 98; Samuels v. McCurdy, 267 U.S. 188, 197 , 198 S., 45 S.Ct. 264, 266, 267, 37 A.L.R. 1378.
Having power absolutely to prohibit manufacture, sale, transportation, or possession of intoxicants, was it permissible for Kentucky to permit these things only under definitely prescribed conditions. Former opinions here make an affirmative answer imperative. The greater power includes the less. Seaboard Air Line Ry. v. North Carolina, supra. The state may protect her people [308 U.S. 132, 139] against evil incident to intoxicants, Mugler v. Kansas, 123 U.S. 623 , 8 S. Ct. 273; Kidd v. Pearson, 128 U.S. 1 , 9 S.Ct. 6; and may exercise large discretion as to means employed.
Kentucky has seen fit to permit manufacture of whiskey only upon condition that it be sold to an indicated class of customers and transported in definitely specified ways. These conditions are not unreasonable and are clearly appropriate for effectuating the policy of limiting traffic in order to minimize well known evils, and secure payment of revenue. The statute declares whiskey removed from permitted channels contraband subject to immediate seizure. This is within the police power of the state; and property so circumstanced cannot be regarded as a proper article of commerce. Sligh v. Kirkwood, 237 U.S. 52, 59 , 35 S.Ct. 501, 502; Clason v. Indiana, 306 U.S. 439 , 59 S.Ct. 609.
In effect we are asked by injunction to allow a distiller to do what the statute prohibits-deliver to an unauthorized carrier. Also to enable a carrier to do what it is prohibited from doing-receive and transport within the state.
Kidd v. Pearson, supra: An Act of the Iowa Legislature in general terms forbade manufacture or sale of intoxicating liquor but permitted these for mechanical or other purposes. An injunction was approved which restrained Kidd from operating his distillery although he claimed the output would be exported for sale beyond the state. This Court said ( 128 U.S. 1 , 9 S.Ct. 11): 'Whether a state, in the exercise of its undisputed power of local administration, can enact a statute prohibiting within its limits the manufacture of intoxicating liquors, except for certain purposes, is not any longer an open question before this court . ... The police power of a state is as broad and plenary as its taxing power, and property within the state is subject to the operations of the former so long as it is within the regulating restrictions of the latter.' [308 U.S. 132, 140] The doctrine of that case has been often applied. Geer v. Connecticut, 161 U.S. 519 , 16 S.Ct. 600; Rippey v. Texas, 193 U.S. 504, 509 , 24 S.Ct. 516, 517; Hudson Water Co. v. McCarter, 209 U.S. 349, 357 , 28 S.Ct. 529, 532, 14 Ann.Cas. 560; 'A man cannot acquire a right to property by his desire to use it in commerce among the states. Neither can he enlarge his otherwise limited and qualified right to the same end'; Sligh v. Kirkwood, 237 U.S. 52 , 35 S.Ct. 501; State Board of Equalization v. Young's Market Co., 299 U.S. 59, 63 , 57 S.Ct. 77, 78; Clason v. Indiana, 306 U.S. 439 , 59 S.Ct. 609.
The two cases last cited recognize that the State may decline to consider certain noxious things legitimate articles of commerce, and inhibit their transportation. Property rights in intoxicants depend on state laws and cease if the liquor becomes contraband.
We cannot accept appellant's contention that because whiskey is intended for transportation beyond the state lines the distiller may disregard the inhibitions of the statute by delivery to one not authorized to receive; that the carrier may set at naught inhibitions and transport contraband with impunity.
The point suggested in respect of Due Process is not in accord with what has been decided in the cases above referred to.
The record shows no violation of Equal Protection. A licensed Common Carrier is under stricter control than an ordinary contract carrier and may be entrusted with privileges forbidden to the latter.
Here the state law creates no discrimination against interstate commerce. It is subjected to the same regulations as those applicable to intrastate commerce.
The Motor Carrier Act of 1935 is said to secure to appellant the right claimed, but we can find nothing there which undertakes to destroy state power to protect her people against the evils of intoxicants or to sanction the receipt and conveyance of articles declared contraband. The Act has no such purpose or effect. [308 U.S. 132, 141] The power of a state to regulate her internal affairs notwithstanding the consequent effect upon interstate commerce was much discussed in South Carolina Highway Dept. v. Barnwell Bros., 303 U.S. 177, 189 , 58 S.Ct. 510, 515, 516. There it was again affirmed that although regulation by the state might impose some burden on interstate commerce this was permissible when 'an inseparable incident of the exercise of a legislative authority, which, under the Constitution, has been left to the states.' In the absence of controlling language to the contrary-and there is none-the Federal Motor Carrier Act should not be brought into conflict with this reiterated doctrine.
The challenged decree must be affirmed.
[ Footnote 1 ] Aug. 9, 1935, c. 498, 49 Stat. 543, 49 U.S.C.A. 301, et seq.
[ Footnote 2 ] Kentucky Acts 1938, Ch. 2, Baldwin's Supp. to Carroll's Statutes 1936, ch. 81, sec. 2554b-97, et seq.
[ Footnote 3 ] Baldwin's Supplement to Carroll's Kentucky Statutes 1936, sec. 2554b-150.
[ Footnote 5 ] Supra Note (3), sec. 2554b-114.
[ Footnote 6 ] Supra Note (5).
[ Footnote 7 ] Supra Note (3), sec. 2554b-118.
[ Footnote 8 ] Supra Note (3), sec. 2554b-119.
[ Footnote 9 ] Supra Note (3), sec. 2554b-124.
[ Footnote 10 ] Supra Note (3), sec. 2554b-154(7).
[ Footnote 11 ] Supra Note (3), sec. 2554b-190.
[ Footnote 12 ] Supra Note (3), sec. 2554b-131.
[ Footnote 13 ] Supra Note (3), sec. 2554b-134(5).
[ Footnote 14 ] Supra Note (3), sec. 2554b-135.

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