Case Name: The People of the State of New York ex rel. J. & M. Haffen Brewing Company, Appellant, v. Maynard N. Clement, as State Commissioner of Excise of the State of New York, Respondent
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1910-07-07
Citations: 139 A.D. 502
Docket Number: 
Parties: The People of the State of New York ex rel. J. & M. Haffen Brewing Company, Appellant, v. Maynard N. Clement, as State Commissioner of Excise of the State of New York, Respondent.
Judges: 
Reporter: Appellate Division Reports
Volume: 139
Pages: 502–507

Head Matter:
The People of the State of New York ex rel. J. & M. Haffen Brewing Company, Appellant, v. Maynard N. Clement, as State Commissioner of Excise of the State of New York, Respondent.
■First Department,
July 7, 1910.
Liquor Tax Law—surrender of certificate —rebate —violation of statute by employee — former acquittal.
Where in- a proceeding to obtain a writ of mandamus directing the payment of a-rebate ón a liquor tax certificate the only violation of the. law alleged is one for , which an employee of the holder was tried and acquitted in criminal proceedings, the Commissioner of Excise may not prove the violation as a bar to the .proceeding.
Appeal by the relator, J. & M, Haffen Brewing Company, from an order of - the Supreme Court, made at the New York Special ' Term and entered in the office'of the clerk of the, county of New York on the 26th day of May, 1910.
The opinion delivered at Special Term is reported in People ex rel. Haffen. B. Co. v. Clement (67 Mise:. Rep 527). ,
D-Cady Herrick of counsel [Ashbel P. Fitch, Mott & Grant, attorneys], for the appellant.
Frederick W. Stelle of counsel [Herbert H. Kellogg, attorney], for the respondent.

Opinion:
Clarke, J.:
Appeal from an order refusing a peremptory writ of mandamus and ordering that an alternative writ of .mandamus issue in- a proceeding to collect a rebate under the Liquor Tax Law. The petition complies with the statute and contains.-the formal requirements. The question involved arises under certain allegation's of the petition and answer. The petition, alléges: " XIII. '.At the time of the surrender -of said liquor tax certificate no complaint, prosecution or action was pending against the said Jacob Debold [who was the original certificate holder] or yóur petitioner on account of any violation of the Liquor Tax Law, and that' neither the said, Jacob Dehold- nór your petitioner had violated' any provision of the Liquor Tax Law during the excise year for which such certificate was issued XIY. On information and belief, one Frank Willard, an employee of said Jacob Debold was arrested on a charge of unlawfully violating the provisions of the Liquor Tax Law of the State of Hew York in premises known as Ho. 1061 Longwood Avenue, alleged to have been committed in the city and county of Hew York on the lltli day of October, 1908; and your petitioner further alleges upon information and belief that said Frank Willard was duly tried by the Court of Special Sessions of the First Division of the City of Hew -York upon such charge and was duly acquitted by said court. A certified copy of said judgment is hereto annexed and forms a part of this petition and is marked ' Exhibit C.' "
Exhibit C is the certificate of the clerk of Special Sessions, " I do certify that it appears from an examination of the records of this office that Frank Willard, the above-named defendant, was tried and acquitted upon said charge by the Court of Special Sessions of the First Division of the City of Hew York on the 16th day of Hovember, 1908." And the charge for which he was tried was in violating the Liquor Tax Law on the 11th day of October, 1908.
The answer alleges this violation and attaches to the answer the affidavit of the patrolman' who swore to the violation and who arrested the bartender. The order appealed from contains the following statement: " And it being stipulated and agreed in open court by the attorneys for the respective parties in this proceeding that the alleged violation of the Liquor Tax Law set forth in para- . graph ' Thirteenth ' of the answer, which is the only violation charged therein, is the same alleged violation set forth in paragraph ' XIY ' of the petition of the relator-and upon which charge the person so arrested was acquitted, and it being further agreed and stipulated that the only question presented on this motion is one of law, that is, whether the alleged violation set forth .in the answer, which is the only violation claimed to have been committed, followed by the -acquittal of the person arrested on said charge, bars the respondent from asserting, pleading or proving said alleged violation in this proceeding."
We have examined with considerable care in recent decisions the question of the right to rebate. We have held that there were certain conditions precedent which must be alleged and proved. (People ex rel. Munch Brewery v. Clement, 117 App. Div. 539.) We have held that what prevents a rebate is a violation of the law during the excise year, not a conviction therefor; that by the statute a violation is conclusively proved' by the record of a conviction of the principal, and is also conclusively proved by the record of two convictions of an employee, and that this is so because the statute as a rule of evidence so provides. We have further held that although the statute provides that the revocation of the license or a bar to a rebate may be established by- the record of two convictions of an employee, nevertheless, where there has been but one conviction, if the commissioner can prove dehors the record, .by common-law evidence, under the rules of practice in civil casesj the violation for which the employee has been convicted, that suffices. (People ex rel. Duncán v. Clement, 134 App. Div. 462.)
This case presents to some extent the converse of the propositions laid down in. those cases. The inquiry is, when the only violation alleged is that upon which an employee has been charged in criminal proceedings and upon which he has been acquitted, does the charge still exist as a charge of .a violation, susceptible-of proof under the practice and procedure prevailing in'civil actions.
Upon principle I do not believe that ordinarily an acquittal upon a criminal charge, where the burden is upon the People to .establish guilt beyond a reasonable doubt, .is necessarily a bar to a civil action, but I am inclined to the opinion that we should so hold under the Liquor Tax Law, and for this reason: Section 24 thereof provides as follows: "If a person.holding a liquor tax certificate and authorized- -to sell liqüors under the provisions of this chapter, against whom n.o complaint, prosecution or action is pending on account of any violation thereof, and who shall hot have violated any provision of this chapter during the excise year for which such certificate was issued, shall voluntarily, and before arrest or indictment for a violation of this chapter, cease to traffic in liquors during the term for which the tax is paid under such certificate, such person or his duly authorized attorney may surrender such tax cer- . tificate to the officer who' issued the samé or. to his successor in office provided that such tax certificate shall have at least one month to run at the time of such surrender; "* . * One of. such receipts said officer shall deliver to the person entitled thereto, and the other of such receipts he shall immediately transmit, with the surrendered certificate and the petition for the cancellation thereof, to the State Commissioner of Excise. If within thirty days from the date of the receipt of such certificate by the State Commissioner of Excise, the person surrendering such certificate shall be arrested or indicted for a violation of this chapter, or proceedings shall' be instituted for the cancellation of such certificate, or an action shall be commenced against him for penalties, such petition shall not be granted until the final determination of such proceedings or action ; and if the said petitioner be convicted, or said action or proceedings be determined against him, said certificate shall be canceled and all rebate thereon shall be forfeited, but if such petitioner be acquitted, and such proceedings or action against him be dismissed on the merits, then the State Commissioner of Excise shall prepare two orders for the payment of such rebate," etc. (See Consol. Laws, chap. 34' [Laws of 1909, chap. 39], § 24, subd. 1; since amd. by Laws of 1910, chap. 503.)
Here is a direct provision that if the certificate holder shall be arrested or indicted for a violation of the Liquor Tax Law and acquitted, then the rebate shall be paid. It seems to me it would be an absurdity to hold, in the face of that positive provision of law, that while the principal who had been arrested or indicted and acquitted could thereupon receive the rebate without the possibility of the chance to try. out again his alleged violation upon the same facts, in a civil proceeding, nevertheless when an employee had been arrested, tried and acquitted, his alleged violation there under consideration, for which we have held the principal responsible under the doctrine of respondeat superior, could still be' the subject of civil investigation with, the possibility of a different- con-, elusion and the forfeiture of the principal's rights. In other words, that a different rule should be applied to the principal and to his agent in the case of acquittal, while the same rule was applied to principal and agent in the case of a violation by either.
In People ex rel. Fallert Brewing Co. v. Lyman (53 App. Div. 470; affd., 168 N. Y. 669) Mr. Justice Jenks said: " The petition shows inter alia that one of the -holders of the certificate was arrested for violation of this law, was arraigned in the City Magistrate's Court, third district, borough of Queens, * was duly tried, ' * was acquitted and that the action against her was dismissed on the merits. A certificate thereof of the clerk. of such court is made a part of the petition. The answering-affidavit sets, forth that the certificate holders did not voluntarily cease to traffic in liquors, and alleges, upon information and belief, that on the second day of September they trafficked with one'John C. McDonough,- selling to him-and to- one Woods two glasses of whisky; that thereafter McDonough made complaint and on September 9, 1899,- notified the district attorney of Queens county by filing a statement under oath. * _ This is the sole violation-charged. The further question is whether the petitioner was acquitted and whether the proceeding was dismissed on tliennerits within the intendment of the Liquor Law. The certificate Of the clerk shows that on examination the. magistrate ' found there -was' not sufficient, evidence to hold defendant for' trial. Defendant was, therefore, discharged on that date.' -:C Merits ' implies a consideration of substance, not Of form; of legal rights, not .of mere defects of procedure or the technicalities thereof. If the evidence on examination of the defendant was not sufficient to order her trial, a discharge was lier legal right (Code Crim. Proc. §207). The purpose of the'provision of section 25 of the Liquor Tax Law is to defeat the rebate in case of violation of law. If such a violation has been charged, the payment of - the rebate must wait the final' determination of any action or proceedings, based upon the violation. So far as the particular proceeding in question is concerned, the action of the magistrate is final. It is not- alleged that any new proceedings were ever instituted.. I think that this disposition may be regarded as an acquittal and. a dismissal upon the merits within -the intendment of the law, inasmuch as the magistrate found that there was no evidence sufficient to warrant a trial." And the order directing that, a peremptory writ of mandamus issue to pay the rebate was affirmed,
" In People ex rel. Stevenson Co. v. Lyman (69 App. Div. 406) Willabd ' Baetlett, J., said: " This appeal raises two questions: *' (2) whether an order of -discharge by a city magistrate of th,e city of Dew York, reciting a determination that there is-no sufficient cause-to believe .the accused person guilty of a violation of the Liquor Tax Law is a dismissal of the proceedings on the merits, within the meaning of section 25 of that statute. It seems to me that the second of these questions is no longer open to discussion. In the case of People ex rel. Fallert Brewing Co. v. Lyman (53 App. Div. 470) it appeared that the city magistrate 'found there was not sufficient evidence to hold defendant for trial,' and, therefore, discharged her. This was held to be an acquittal and dismissal on the merits; and the decision of this court to that effect has since been affirmed by the Court of Appeals."
Of course, in both of. these case's it was the principal whose acquittal was under consideration, and it is also true that the Excise Commissioner alleges that since those opinions the Liquor Tax Law was amended by .adding as a condition precedent the words, "and who shall not have violated any provision of this chapter during the excise year for which such certificate was issued." While it is true, as we have held, that this violation is not required to be proved by a conviction, yet-that does not at all affect the question of the effect to be given to an acquittal. If, as the respondent urges, the proceeding is between different parties, to wit, the State and the defendant, and the Commissioner and the defendant, this was just as true in the two cases cited. . The truth about the matter,is that the statute gives certain effect to the result of criminal proceedings upon the civil proceedings for the recovery of the rebate, and we are to look at it from the standpoint of the statute.
I reach the conclusion that the clear intention of the Legislature was that an acquittal should have the same binding effect in favor of the person claiming the rebate as a conviction had f against him. Therefore, as it is conceded that the charge upon which the employee was acquitted is the only violation alleged, there is no reason shown why a peremptory writ should not issue.
The order appealed from should be reversed and a peremptory-writ granted, with costs to the appellant.
Ingbaham, P. J., Laughlin, Scott and Millee, JJ., concurred.
Order reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs.
Now section 24.—[Rep.
Now section 24.—[Rep.