Court Opinion

ID: 3396480
Source: CourtListenerOpinion
Date Created: 2016-07-05 19:03:48.406373+00
Date Added: 2024-06-11T14:02:56.803773
License: Public Domain

I am unable to concur entirely with the views expressed in the very able opinion prepared by Circuit Judge Frank Smith sitting in place of Mr. Presiding Justice Ellis, who is not participating on account of temporary physical disability.
I concur in what is said in that opinion except insofar as it holds the provisions of "Subdivision A" of Section 4 of Chapter 16848, Acts of 1935, valid.
I think the tax imposed under Class 1 of Subdivision A, supra,
is valid and that this can be segregated from the balance of the subdivision and held valid and applicable to all stores, although the remaining provisions of that subdivision are held void and inoperative because of being in abrogation of organic law, which I think they are. This may be done on the same authority and reasoning under and by which Judge Smith's opinion holds the provisions of Class 1 "Subdivision B" to be valid, although the remainder of that subdivision is invalid.
Under the Federal Rule a tax may be so oppressive as to destroy the subject taxed without being held invalid. Florida does not subscribe to that rule but holds to that which is, that "Excise taxes have been imposed in many ways, but, so long as they are reasonable, not unjustly discriminatory, nor arbitrary, whimsical, irrational, grossly oppressive, plainly unequal or contrary to common right, they will be upheld." State v. Allen,83 Fla. 214, 91 So. 104, 26 A.L.R. 735; Jackson v. Neff, 64 Fla. 326, 60 So. 350, writ of error dismissed in 238 U.S. 610, 35 S. Ct. 792, 59 L.Ed. 1488; Peninsular Gas Co. v. State, 68 Fla. 411,67 So.2d 165; Amos v. Gunn, 84 Fla. 285, 94 So.2d 615; Amos v. *Page 614 
Mathews, 99 Fla. 1, 65, 115, 126 So.2d 308; Sheip Co. v. Amos,100 Fla. 863, 130 So.2d 699; Liggett Co. v. Amos, 104 Fla. 609, 141 So.2d 153, 157, reversed in Liggett Co. v. Lee, 288 U.S. 517, 53 S. Ct. 48. See Gray v. Central Fla. Lbr. Co., 104 Fla. 446, 140 So.2d 320, 325, 141 So.2d 604.
But even under the Federal Rule clearly arbitrary discriminations are held to invalidate. F.S. Royster Guano Co. v. Commonwealth of Virginia, 253 U.S. 412, 415, 64 L.Ed. 989, 990, 40 Sup. Ct. 560; Airway Electric Appliance Corp. v. Day,266 U.S. 71, 85, 69 L.Ed. 169, 177, 45 Sup. Ct. Rep. 12; Schlosinger v. Wisconsin, 270 U.S. 230, 240, 70 L.Ed. 557, 564, 43 A.L.R. 1224, 46 Sup. Ct. Rep. 260.
To begin with, I cannot agree that the statute makes the "Chain
of stores" the unit for the purpose of taxation. The tax laid by Section 4 of the Act is: "For the privilege of continuing in or engaging in the business of a retailer as defined in this Act, there is hereby imposed upon every person, firm, corporation, association or copartnership, trust or joint stock company, and any firm however organized or whatever be the plan or operation, shall under the terms of this Act be required to obtain a permit or license to operate a store in this State, a tax which shall be equal to the amount due under the provisions of Subdivision A, and the amount due under the provisions of Subdivision B of Section 4 of this Act;"
A retailer is defined as follows by the Act; "`Retailer' includes every person engaged in the business of making sales at retail."
So it is clear that the tax is levied on the retailer for each store operated and the amount of the tax is determined by the class within which the retailer falls under the provisions of Subdivision A of Section 4, supra. *Page 615 
Under the terms of the Act, if John Doe operates three stores he is a retailer coming within Class 2 and is entitled to procure his license for the operation of such stores for $50.00 each per annum, beginning July 1st, as long as he remains subject only to the license tax fixed for Class 2. There is no provision for a Class 2 tax paid to be applied on a Class 3 tax. So if John Doe is inclined to and determines to open and operate a fourth store he must then procure license as a retailer operating four stores and must pay for the license for each store under the provisions of Class 3 of Section 4, supra, or $100.00 for each store. Therefore, he must pay $400.00 license tax for the privilege of operating the fourth store along with the original three; but he can add and operate the fifth store and sixth store, by paying an additional license of only $100.00 for each. This is true while at the same time he is now paying $100.00 for the privilege of operating his No. 1 store, his next door competitor is paying a license of $10.00 for the privilege to operate a like store as a retailer under the same legislative Act. So does the discrimination continue until we reach Class 6 and here it gets worse.
A retailer who operates 15 stores is in Class 5, with license paid to operate his 15 stores at $300.00 each. He wishes to acquire and operate one more store; to do so he must procure a license for each of his 15 stores and one for his 16th store at $400.00 each, or $6400.00. This he must pay for the privilege of operating his 15 stores in connection with his 16th store, although he may acquire and operate his seventeenth (17) (and any number of stores above that number) by paying an additional license tax of only $400.00 each for the privilege of operating this seventeenth and each additional store in connection with the other 16 stores. He must pay a license tax of $400.00 *Page 616 
for each of his 16 or more stores, while his competitor next door who operates only six stores is required to pay a license fee of only $100.00 on each store. The retailer operating 16 stores pays at least $6400.00 for his license, while the retailer operating six stores pays $600.00 for the privilege of operating them.
Eighteen chain stores may be operated in groups of six stores each under different management for license tax of $1800.00, while the same number of otherwise identical stores except for being under one management will be required to pay $7200.00 for licenses.
It may be said that the legislative intent was that when a license tax shall have been paid on a group of stores in one class and the retailer thereafter opens and operates additional stores which would put his stores in a higher priced bracket, he should have credit on his higher license for the cost of his original license. This may be true, but the Act is not so written, and it is not our province to rewrite it. It is just as reasonable to assume that the legislative intent was to apply the higher tax in each bracket to the stores in that bracket in excess of the stores covered by the next preceding lower bracket which would have eliminated all question of the validity of the tax. Liggett  Co. v. Lee, 288 U.S. 517, 53 Sup. Ct. Rep. 481, 85 A.L.R. 699, 77 L.Ed. 929; Fox v. Standard Oil Co., 294 U.S. 87, 79 L.Ed. 780, 55 Sup. Ct. Rep. 333. But, we can not rewrite the Act in this way and the Act as written will not warrant that construction. I think the taxes as laid in Classes 2, 3, 4, 5 and 6 in Subdivision A are clearly arbitrary and discriminatory as between retailers operating chain stores and that these provisions of the Act violate the equal protection of the law
provisions of the State and *Page 617 
Federal Constitutions and that they also violate due process of law.
The language used in the Act shows on its face that it was intended to be arbitrary and discriminatory. Section 1 of the Act says in part:
"DECLARATION OF POLICY. It is hereby determined and declared that extensive new revenues are required to promote education and to preserve the common school system of the State of Florida; * * * and further, that the increasing growth of chains and the greater multiplication of units of stores tend to foster monopoly and to create unemployment by driving out of business their competitors who do not enjoy such advantages and that therefore the multiplication and extension of such units of chain stores should be discouraged as a matter of public policy."
This language indicates the intent to work a hardship under the guise of a revenue measure that would in part at least retard or destroy the subject taxed. This might be done with an Act constituting a proper police regulation in the exercise of existing police power. But, it is very properly conceded by the Attorney General that there is no proper place for the exercise of the police power in the enactment or enforcement of this Act.
The answer avers: "Some of the material points of difference between chain stores and independently owned stores operating in Florida, (are) to-wit: abundant capital, standardization in equipment and display, superior management, combination of wholesale and retail functions under one control, more rapid turnover, uniformity in store management, uniform accounting methods, a unified sales policy co-ordinating the diverse units, more current styles because of buying ability, superior and unified advertising, superior location, discounts, allowances, and rebates *Page 618 
on quantity purchases, and the serving of the public in the manner in which the public desires to be served."
At another place in the answer it is alleged: "Florida consumers also buy their groceries from chain stores because of the pleasing personality of the store manager or other employees, because of the aggressive and consistent advertising of their wares on the part of the chain stores, and on account of the sanitary condition of the selling premises."
Aside from the revenue feature of the Act, its chief purpose appears to be to place such a burden on some classes of retail merchants as to make easier successful competition by other classes. How long, oh Lord, how long, will it take for us to learn that the creation of successful business acumen and practices, of good moral character and of the application to religious thoughts and habits are things far beyond the power of legislative enactments or judicial decrees, although legislative enactment in the exercise of the police power where such power is applicable may either open wide or materially obstruct the road to debauchery and immorality and in doing so leave the judiciary powerless to interfere with the condition so created. The courts have no power to either enact or to repeal or to veto laws. The province of the Court when the validity of a legislative enactment is legally challenged is to apply to the Act the yardstick known as the Constitution and unless it be clearly
shown that it will not satisfy that measure it must be held valid, although it may license vice and disregard good morals. Even the record in this case shows that the opinion and judgment of the Supreme Court of the United States in the Stewart Dry Goods Company case was available to members of the Florida Legislature when the provisions contained in Subdivision B were put into this statute. *Page 619 
Therefore, the like provisions as those contained in that Subdivision in Classes 2 to 6 inclusive had then been held unconstitutional by the highest court in the nation, which fact was known, or should have been known to all well informed lawyers, and to all persons participating in such legislation. But, with this condition evident the Act was passed by the Legislature and, in the language of the street, the "buck" was passed to the courts. It must have been apparent that the net result would certainly be the fixing of a sugar-coated sales tax on all the retail merchants of Florida to the extent of one-half of one per cent. of gross cash receipts with the probability of fixing an additional arbitrary, discriminatory and discouraging
tax burden on a very large part of those retail merchants who are shown by the answer of the Attorney General in this case to be rendering to the buying public the best of service from every standpoint.
In the case of State, ex rel. Lamar, v. Jacksonville Terminal Co., 41 Fla. 363, 27 So. 221, it was held:
"The provisions of Section 1 of Article XIV of the amendments to the Constitution of the United States, forbidding State legislation that denies to any person the equal protection of the law, does not preclude legislation reasonably classifying persons and things, and generally, it only requires the same means and methods to be applied impartially to all the constituents of a class so that the law shall operate equally and uniformly upon all persons in similar circumstances. The rest of thereasonableness of a classification is that it must be based upon some difference that bears a just and proper relation to attempted classification, and is not a mere arbitrary selection."
Let it be understood that I do not question the power of the Legislature to enact a valid law which establishes a *Page 620 
discriminatory license tax as between "individual" stores and "chain" stores, as long as the discrimination is not so oppressive, unequal, whimsical and arbitrary as to violate the provisions of organic law. Nor do I question the power of the Legislature to lay a progressively increasing tax on chain stores in proportion to the benefits enjoyed by reason of the increases in units of distribution.
Here, however, we are dealing with an unreasonable, arbitrary and whimsical discrimination between different units in chain stores falling within the same class as well as between different units falling within different classes. If the addition of a store to an existing chain of six stores confers a benefit on all so that the tax on the original six must be raised, by what reasoning may it be assumed that the eighth store may be added to the so created chain of seven without the requirement of any additional tax on the seven?
I am not unmindful of the fact that a three-judge Federal Court has held the provisions of the Act here under consideration valid and that such fact, while not controlling the Supreme Court of Florida, is of persuasive value and influence. I am also cognizant of the fact that in Liggett  Co. v. Lee, 288 U.S. 517, 77 L.Ed. 929, 53 Sup. Ct. Rep. 481, 85 A.L.R., 699, the Supreme Court of the United States said: "The addition of a store to an existing chain is a privilege, and an increase of the tax on all the stores for the privilege of expanding the chain cannot be condemned as arbitrary." The statement, however, was entirely gratuitous, as it was not at all necessary in the determination of the validity of the statute then being considered. In Fox v. Standard Oil Co., 294 U.S. 87, 79 L.Ed. 780, 55 Sup. Ct. Rep. 333, to quote from the opinion in that case, the tax was laid as follows:
"Upon one store the fee was to be $2; upon two stores *Page 621 
or more, but not to exceed five, the fee was to be $5 for each additional store; upon six or more, but not to exceed ten, $10 for each additional store; upon each store in excess of ten but not to exceed fifteen, $20; upon each in excess of fifteen but not to exceed twenty, $30; upon each in excess of twenty, but not to exceed thirty, $35; upon each in excess of thirty, but not to exceed fifty, $100; upon each in excess of fifty, but not to exceed seventy-five, $200; and upon each in excess of seventy-five, $250."
So the question of the validity of such a tax as is here sought to be imposed was not involved.
I have found no case where the questions here presented were directly involved, except that of J.C. Penney  Co. v. Diffendorf, 54 Idaho, 374, 32 P.2d 784, and in the Act involved in that case the gross infirmities and discriminations did not exist as they do in the Act here under consideration. There the increase in the tax had some relation to the advantages ascribed to the numerical increase in operations.
The tax there under consideration was laid as follows:
1. Upon one store the annual license fee shall be five dollars for each such store;
"2. Upon two stores the annual license fee shall be ten dollars for each such store;
"3. Upon three stores the annual license fee shall be twenty dollars for each such store;
"4. Upon four stores the annual license fee shall be thirty-five dollars for each such store;
"5. Upon five stores the annual license fee shall be fifty-five dollars for each such store;
"6. Upon six stores the annual license fee shall be eighty dollars for each such store; *Page 622 
"7. Upon seven stores the annual license fee shall be one hundred ten dollars for each such store;
"8. Upon eight stores the annual license fee shall be one hundred forty dollars for each such store;
"9. Upon nine stores the annual license fee shall be one hundred seventy dollars for each such store;
"10. Upon ten stores the annual license fee shall be two hundred dollars for each such store;
"11. Upon eleven stores the annual license fee shall be two hundred thirty dollars for each such store;
"12. Upon twelve stores the annual license fee shall be two hundred sixty dollars for each such store;
"13. Upon thirteen stores the annual license fee shall be two hundred ninety dollars for each such store;
"14. Upon fourteen stores the annual license fee shall be three hundred twenty dollars for each such store;
"15. Upon fifteen stores the annual license fee shall be three hundred fifty dollars for each such store;
"16. Upon sixteen stores the annual license fee shall be three hundred eighty dollars for each such store;
"17. Upon seventeen stores the annual license fee shall be four hundred ten dollars for each such store;
"18. Upon eighteen stores the annual license fee shall be four hundred forty dollars for each such store;
"19. Upon nineteen stores the annual license fee shall be four hundred seventy dollars for each such store;
"20. Upon each such store in excess of nineteen the annual license fee shall be five hundred dollars for each such store."
But, even so, I am not convinced that the rule stated in that case is sound law. The rule is held to be otherwise *Page 623 
and in harmony with the views herein expressed in City of Douglas v. South Ga. Grocery Co., 180 Ga. 519, 179 S.E. 768; Great Atlantic  Pacific Tea Co. v. Maxwell, 199 N.C. 433,154 S.E. 838. Affirmed 284 U.S. 575, 76 L.Ed. 500, 52 Sup. Ct. Rep. 26, and authorities cited in these cases.
It appears to me to be an elementary, sound and necessary conclusion that to deny John Doe the right to operate six chain stores for the same license tax for which Richard Roe may in the same locality operate six like chain stores, although John Doe operates one or three other such chain stores for the license to operate which he must pay a reasonably higher license, is to definitely deny to John Doe the equal protection of the law in the operation of those six stores.
For the reasons stated, I think Class 1 of Subdivision A of Section 4 and Class 1 of Subdivision B of Section 4, supra, are valid legislative provisions and should be applied to all coming within the purview of the Act and that all other provisions of Subdivision A and of Subdivision B of Section 4 of the Act should be held void as violating Section 1 of the Declaration of Rights of the Florida Constitution and the Fourteenth Amendment to the Federal Constitution.