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Denver v. People

Supreme Court of Colorado. En Banc
Feb 14, 1939
88 P.2d 89 (Colo. 1939)

Opinion

No. 14,367.

Decided February 14, 1939. Rehearing denied March 13, 1939.

Action by the people against the City and County of Denver to recover eighty-five per cent of liquor license fees collected by the city under the provisions of chapters 82 and 142, S. L. '35, and to make the same available for the old age pension fund. Judgment for the people.

Affirmed.

1. CONSTITUTIONAL LAW — Construction. Argumentum ab inconvenienti is not to be permitted to influence the courts to defeat by construction a constitutional mandate.

2. Construction. Section 24, article V of the Constitution was framed to avoid confusion, ambiguity and uncertainty in the statutory law through the existence of separate and disconnected legislative provisions. It was not intended to abolish the power of the legislature to enact measures which amend pre-existing legislation by implication only.

3. Reserved Rights. The most important right retained by the people under the Constitution is that which permits them to amend this fundamental law in any manner they see fit, so long as such amendments are not repugnant to the Constitution of the United States.

4. Liquors — License Fees — Municipal Corporations. Chapters 82 and 142, S. L. '35, as they concern liquor license fees, do not violate section 6, article XX of the Constitution. The collection of such fees by a city is not a local and municipal matter, because amended article XXII of the Constitution, concerning intoxicating liquors, applies to the whole state.

5. Liquors — License Fees. Chapters 82 and 142, S. L. '35, concerning liquors and license fees, do not violate section 10, article I of the federal Constitution.

6. Statutes — Old Age Pensions. To the extent that chapters 82 and 142, S. L. '35, concerning liquors, conflict with the old age pension amendment, they must yield to the Constitution.

7. INTOXICATING LIQUORS — Police Power. The state liquor code is deemed an exercise of the police power and a vested interest on the ground of conditions once obtained cannot be asserted against the proper exercise of this power.

8. CONSTITUTIONAL LAW — Statutes — Old Age Pensions. The pertinent provisions of the old age pension amendment to the Constitution must be read into chapters 82 and 142, S. L. '35, concerning liquors.

9. INTOXICATING LIQUORS — Right to Sell — Municipal Corporations. A citizen of Colorado has no inherent right to sell intoxicating liquor, this being a privilege to be obtained under a license granted. In this respect a municipal corporation is in no different position than is the citizen.

10. License — Recall. Authority to sell intoxicating liquor being dependent upon legislative grant is subject to recall at the discretion of the general assembly.

11. License Fees — Municipal Corporations. A municipal corporation has no property right in intoxicating liquor fees collected under and by virtue of the provisions of chapters 82 and 142, S. L. '35.

12. OLD AGE PENSIONS — Constitutional Law. The old age pension amendment to the Constitution providing, inter alia, that beginning January 1, 1937, eighty-five per cent of the revenue derived from excise taxes on liquors shall become a part of the old age pension fund is not retroactive; but assuming that it is, the objection cannot be raised by one having no property right in such revenue.

13. INTOXICATING LIQUOR — License Fees — Old Age Pensions — Presumption. A municipal corporation having collected liquor license fees, eighty-five per cent of which belong to the old age pension fund, will be presumed to have them in its possession unless and until the amount allocated to that fund has been turned over to it.

14. STATUTES — Construction — Words and Phrases. Relative and qualifying words and phrases, where no contrary intention appears, will be construed to refer solely to the last antecedent with which they are closely connected.

15. CONSTITUTIONAL LAW — Interpretation. When the Constitution speaks in plain language in reference to a particular matter, courts have no right to place a different meaning on the words employed because a literal interpretation may happen to be inconsistent with the other parts of the instrument in relation to other subjects.

16. Police Power. There is no such halo surrounding the police power vested in municipalities as to render them immune from the highest prerogative exercised by the people and expressed in the Constitution.

Error to the District Court of the City and County of Denver, Hon. Henry S. Lindsley, Judge.

Mr. MALCOLM LINDSEY, Mr. THOMAS H. GIBSON, for plaintiff in error.

Mr. BYRON G. ROGERS, Attorney General, Mr. REID WILLIAMS, Assistant, for the people.


ACTION by the people to recover of and from the City and County of Denver, a municipal corporation, eighty-five per cent of the license fees collected by said city under the provisions of chapters 82 and 142, Session Laws 1935, subsequent to January 1, 1937, and to permit their availability for the old age pension fund. The people were successful below, and it is to review the judgment in their favor, entered on the overruling of the city's demurrer, that the writ of error herein is prosecuted by the city.

The city's single assignment of error is, "The court erred in overruling the demurrer of the defendant to the complaint of the plaintiff."

The demurrer contained two grounds. The first was alleged insufficiency of facts, which we need not consider because, if the constitutional objections urged are not sound, the complaint does state sufficient facts to constitute a cause of action. The second ground was as follows:

"That said complaint is framed upon the theory and is based upon a construction of that certain Amendment of the Constitution of Colorado that was enacted by the people at the November, 1936, election, and entitled `An Act Amending the State Constitution by adding thereto a new Article concerning Old Age Pensions, and providing funds for the payment thereof,' under which the plaintiff, in substance, claims that the Old Age Pension Fund created and established in the Treasury of the State of Colorado by said Amendment, was and is intended to include, and includes, 85% of the Liquor License Fees of the defendant for the collection of which special provision is made by chapter 142 Session Laws of 1935, and 85% of the Liquor Fees of said City and County of Denver on fermented, malt beverages for the collection of which special provision is made by chapter 82 Session Laws of Colorado 1935, and the said constitutional amendment if, when and as so construed is in violation of and repugnant to:

"1. Section 24 of Article V of the Colorado Constitution [Revival, amendment and extension of laws].

"2. Section 25 of Article II of the Colorado Constitution [Due process of law.]

"3. Section 6 (as amended), of Article XX of the Colorado Constitution [Home rule for cities].

"4. So much of the Fourteenth Amendment of the Constitution of the United States of America as provides as follows: `Nor shall any State deprive any person of life, liberty or property without due process of law; nor deny to any persons within its jurisdiction the equal protection of the laws.'"

"5. Section 10, Article I of the Federal Constitution [Ex post facto laws. Obligation of contracts].

"6. Section 11, Article II of the Colorado Constitution [Ex post facto laws]."

The crux of this litigation is the construction to be given to, and the legal effect of, that part of section 2 of the Old Age Pension Amendment, chapter 200, Session Laws, 1937, page 881, reading as follows: "Section 2. There is hereby set aside, allocated and allotted to the Old Age Pension Fund sums and money as follows: * * * (b) Beginning January 1, 1937, eighty-five per cent of all net revenue accrued or accruing, received or receivable from taxes of whatever kind upon all malt, vinous or spirituous liquor, both intoxicating and nonintoxicating, and license fees connected therewith."

Since January 1, 1937, the city has collected certain liquor license fees under the provisions of chapters 142 and 82, Session Laws 1935, chapter 89, volume 3, '35 C. S. A. (being the intoxicating and nonintoxicating liquor laws respectively), and now seeks to retain them as part of its general fund. The people contend that under section 2 (b), such fees must be turned over to the state treasurer to be placed in the old age pension fund.

We shall consider the questions in the order set forth in the demurrer.

[1, 2] 1. Section 24, article V of the state Constitution reads as follows: "No law shall be revived, or amended, or the provisions thereof extended or conferred by reference to its title only, but so much thereof as is revived, amended, extended or conferred, shall be re-enacted and published at length."

All that would be necessary, if we desired to summarily dispose of this question, would be to say that we have specifically held that this section of the amendment does not violate this constitutional provision. In re Interrogatories, 99 Colo. 591, 65 P.2d 7. However, since no reason was there assigned, we may repeat our pronouncement in Denver Circle R. Co. v. Nestor, 10 Colo. 403, 409, 15 Pac. 714, where, after a discussion of the purposes of this provision (section 24 of article V), we said, "We also indorse the salutary rule that the argument ab inconvenienti is not to be permitted to influence the courts to defeat by construction a constitutional mandate." It also may be added that in the opinion in the principal Colorado case relied upon by the city on this point (People v. Friederich, 67 Colo. 69, 74, 185 Pac. 657), we quoted from Callahan v. Jennings, 16 Colo. 471, 27 Pac. 1055, as follows: "The intent and wisdom of this provision are obvious. It was framed for the purpose of avoiding confusion, ambiguity and uncertainty in the statutory law through the existence of separate and disconnected legislative provisions, original and amendatory, scattered through different volumes or different portions of the same volume."

What appears to be the general rule holds that it (section 24, article V) was not intended to abolish the power of the legislature (a fortiori, the people) to enact measures which amend pre-existing legislation by implication only. 59 C. J. 871, and Colorado cases cited.

2. Does the attempted taking of these license fees violate the due process clause of the Colorado (section 25 of article II) and federal (Fourteenth Amendment) Constitutions? Assuming for the moment that the city has a property right in the license fees here involved (a question which we shall later discuss), it does not necessarily follow that, in so far as our state Constitution is concerned it may invoke the due process clause, because section 28 of article II provides: "The enumeration in this Constitution of certain rights shall not be construed to deny, impair or disparage others retained by the people." The most important retention is the right of the people to amend their Constitution in any manner they see fit, so long as such amendments are not repugnant to the Constitution of the United States. Whether any repugnancy to the federal Constitution is shown, also will be discussed later.

3. There is no merit in the contention that the act under consideration violates section 6, article XX of the state Constitution because the collection of these license fees is a local and municipal matter. No one would seriously contend that the granting of licenses for the manufacture and sale of intoxicating liquors is not an incident of the liquor traffic and controllable as such. "This presents for consideration the question of whether article XXII applies to the whole state, and if this be determined in the affirmative, the question of whether the control of the sale of intoxicating liquors under Article XX ever was exclusively a matter of local and municipal concern, is eliminated and need not be determined." People v. Denver, 60 Colo. 370, 374, 153 Pac. 690. As to whether or not said article XXII (as amended in 1932) applies to the whole state has been "determined in the affirmative." Colorado Springs v. People ex rel., 99 Colo. 525, 527, 63 P.2d 1244.

[5, 6] 4. City contends further that a construction which upholds the people's demand for these license fees would violate section 10, article I of the federal Constitution and violate and impair a contractual obligation and would enforce an ex post facto law. It is on this point that the violation of the due process clause also hinges, because it cannot be violated if the city has no property right in the subject of the controversy. City further contends that it has some sort of a vested right to these funds because they were collected under chapters 82 and 142, supra, which are unrepealed, but its position in this behalf is refuted by language quoted from cases cited by its counsel, e. g., "a tax levy by a municipality, germane to the purposes for which it was incorporated, not in excess of a limitation fixed by the constitution * * *." Portland v. Welch, 154 Ore. 286, 59 P.2d 228. "We think it is, also, manifest that all revenues coming into the treasury of a municipality in pursuance of law, unless the law specifically provides otherwise, becomes a part of its general fund * * *." State v. Sheppard, 79 Wash. 328, 330, 140 Pac. 332, and, "No man shall be `disseized of his property except by the law of the land.'" Bailey v. City of Raleigh, 130 N.C. 209, 41 S.E. 281. The attempt of the city herein to keep these license fees would be in excess of the limitations fixed by our Constitution. The law does specifically provide otherwise. If the city be disseized, it is by the law of the land. To the extent that chapters 82 and 142 (c. 89, '35 C. S. A.) supra, conflict with the Old Age Pension Amendment, they must yield to the Constitution.

[7, 8] The liquor code of this state is deemed an exercise of the police power. Section 15, chapter 89, '35 C. S. A., S. L. '35, p. 597, § 1. And, "a vested interest on the ground of conditions once obtained cannot be asserted against the proper exercise of the police power." Colby v. Board of Adjustment, 81 Colo. 344, 352, 255 Pac. 443; Hadacheck v. Sebastian, 239 U.S. 394, 410, 36 Sup. Ct. 143, 60 L. Ed. 348. The pertinent provisions of the amendment must be read into said chapter 89.

[9-11] "In this state there never has been, and is not now, an inherent, natural or common-law right in the citizen to sell intoxicating liquors. Indeed he has no absolute right to sell it at all. It is but a privilege he gets under a license granted." Schwartz v. People, 46 Colo. 239, 248, 104 Pac. 92. The city is in no different or better position than a citizen. "That this power depending, as it does, upon legislative grant, is subject to recall in the discretion of the general assembly [again a fortiori, the people], is too clear for argument." Parsons v. People, 32 Colo. 221, 237, 76 Pac. 666. It is obvious, that the city acquired no property right in these fees.

[12, 13] 5. Finally, on the constitutional objections. The purpose of this action is only to obtain eighty-five per cent of the liquor license fees collected after January 1, 1937; the officials are charged with notice of the provisions of the Old Age Pension Amendment adopted at the November election in 1936, Therefore, no question of an ex post facto law is involved. The amendment was prospective in its operation on these license fees, and not retrospective; consequently section 10, article I of the federal Constitution, and section 11, article II of the state Constitution are not here involved. Even though the operation of the act concerning these fees was retrospective, it still is not vulnerable to the constitutional objection raised by the city, since, as we have shown, the latter had no property right in them, and because "when it [we substitute the Old Age Pension Amendment] became effective it operated on all liquor license revenue still existing and undisposed of. Such were the funds here in question." Colorado Springs v. People, supra, p. 527. The law will assume that the city still had the revenue derived from these fees.

On the question of statutory construction, we may observe that in In Re Interrogatories, 99 Colo. 591, 595, 65 P.2d 7, we were asked the following: Third: "If the court holds that section 2 (b) of said amendment is self-executing, does it operate to repeal, in its entirety, section 3 (b) of chapter 8, Second Extraordinary Session Laws, 1936?. This section reads as follows: '(b) All net revenues accrued or accruing, received or receivable from the excise taxes upon intoxicating liquors and license fees, which are now payable to the state treasury pursuant to the provisions of chapter 142, Session Laws of Colorado 1935; provided however, that 50% of the monthly revenues so derived shall remain in and be credited to general revenue fund of the state, until such credit shall have aggregated the sum of one million dollars ($1,000,000.00) and thereafter all such revenues received shall be credited to the state public welfare fund.'"

"11-(3) The answer is `Yes.'" All the Justices concur.

Since no reason was given in answering the interrogatory above quoted, we deem it expedient to here elaborate our answer. The language used in section 2 (b) of the Old Age Pension Amendment clearly was intended to be substituted for that quoted from section 3 (b), chapter 8, Second Extraordinary Session Laws, 1936. As will be noted, the words "which are now payable to the state treasury" are omitted from the Old Age Pension Amendment.

We are not here concerned with taxes upon liquor, either ad valorem or excise, notwithstanding counsel's argument that the antecedent of the word "therewith," the last word in said section 2 (b), is "taxes" and not "liquors." The plain, unambiguous meaning is, that receipts from license fees in connection with the traffic in "malt, vinous, and spirituous liquors, both intoxicating and nonintoxicating," wherever such license fees are exacted, are "hereby set aside, allocated and allotted to the Old Age Pension Fund."

The rule of construction applicable is, "Thus, relative and qualifying words and phrases, where no contrary intention appears, will be construed to refer solely to the last antecedent with which they are closely connected." 12 C. J. 706, § 50.

"When the Constitution speaks in plain language in reference to a particular matter [license fees connected with the liquor business], the courts have no right to place a different meaning on the words employed, because the literal interpretation may happen to be inconsistent with other parts of the instrument [statutes, even more so] in relation to other subjects." Ibid. § 49.

If it be urged, that this construction constitutes an unjustifiable interference with a local or municipal purpose, the answer is, that under chapter 201, Session Laws 1937, these same fees, after being paid into the state treasury, immediately will be reallocated and distributed to the respective "old age pension funds" in the sixty-three countries, available for pensioners in the local communities.

There is no such halo surrounding the police power vested in our municipalities, as to render them immune from the highest prerogative exercised by the people, and expressed in this constitutional amendment.

Judgment affirmed.

MR. JUSTICE BOCK concurs specially.

MR. JUSTICE YOUNG, MR. JUSTICE KNOUS and MR. JUSTICE BURKE dissent.


Summaries of

Denver v. People

Supreme Court of Colorado. En Banc
Feb 14, 1939
88 P.2d 89 (Colo. 1939)
Case details for

Denver v. People

Case Details

Full title:CITY AND COUNTY OF DENVER v. THE PEOPLE

Court:Supreme Court of Colorado. En Banc

Date published: Feb 14, 1939

Citations

88 P.2d 89 (Colo. 1939)
88 P.2d 89

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