State v. Distilling Co.

power to determine, and, as we have already said, it does not follow that a license must issue for a fixed period."

And the Supreme Court of the United States, in the case of Clark v. Titusville, 184 U. S. 1. c. 330, said: "Classification according to the amount of business done, has been frequently recognized by the Federal courts."

In the latter case, the court held that an ordinance imposing a license tax upon merchants by which they were divided into classes according to the amount of their sales, each class including all whose sales ranged between a certain minimum and maximum amount, does not violate the equality clause of the Constitution of the United States, although the result would be to make persons in different classes pay different rates, and to make those in the same class pay a different ratio if the amounts of their sales differed. If that rule is valid when applied to ordinary business vocations, then for stronger reasons it must be held to be valid when applied to the liquor business.

Black on Intoxicating Liquors, announces the same rule in section 232.

We therefore hold that the act in this regard does not violate section 3 of article 10 of the Constitution. The constitutionality of the act is also assailed because it exempts from its operation druggists, dramshop-keepers and social and business clubs.

Druggists, dramshop-keepers and the clubs here mentioned are classified by other provisions of our liquor laws, and the two former are licensed to sell liquors under other statutes of the State, for which they pay the required license fees. And as to the clubs, they neither manufacture, sell, nor rectify any kind of liquors; the members thereof buy and drink their own liquors.

Druggists can only sell liquors, wines, etc., for medicinal or sacramental purposes, and dramshop

State v. Distilling Co.

keepers retail their liquors in small quantities, usually by the glass or drink, and consequently they require more stringent regulation than does the manufacturer, wholesaler or rectifier.

Clearly these are reasonable and proper classifications, especially when we consider the fact that all of them hold their licenses purely as a matter of grace from the State.

it

In speaking of a like question, Judge GANTT, in the Bixman case, on page 35, said: "Holding, as we do, that this is not a property tax, but a proper police regulation of an otherwise inhibited article, is not open to the objection that it exceeds the rate of property taxation; but counsel urge another view, and it is this: Treated as a charge or fee, they say the exaction is not uniform, because it is imposed upon the business of those who manufacture and sell beer and malt liquors only, and not upon the business of all who deal in intoxicating liquors. In other words, the objection is that in segregating the manufacture and sale of beer and malt liquors the Legislature has made an arbitrary classification, and thus unjustly imposes a burden upon this particular kind of business, when, if imposed at all, it should be upon the business of all who are engaged in the manufacture and sale of intoxicating liquors of every kind; that it is class legislation. To this we do not assent. The State is under no obligation to permit the manufacture of any kind of intoxicating liquors. It may impose one kind of restrictions upon one kind of intoxicants and another kind upon another sort.'

Again on page 37, quoting from Senior v. Ratterman, 44 Oh. St. 661, he says: "The law, as to its taxing features, operates upon a business, and not upon property, within the meaning of the section referred to, and hence is not required to be uniform to all forms of traffic or to all classes.' A difference was made

State v. Distilling Co.

between a manufacturer and a wholesaler, and it was held proper classification."

A reasonable classification of the persons and the subjects to which an act applies and its uniform application to each of said classes is all that the State or Federal Constitution requires. [State ex inf. v. Standard Oil Co., 218 Mo. 1. c. 369, and cases cited; American Sugar Refining Co. v. Louisiana, 179 U. S. 1. c. 92.]

This classification clearly conforms to that rule, and we therefore hold that the act does no violence to the State or Federal Constitution in that regard.

It is finally insisted that this act violates section 3 of article 10 of the Constitution, for the reason that it exempts from its operation persons who sell intoxicating liquors of any kind in any quantity made of grapes or fruits grown in this State, and is not therefore uniform in its application.

This precise question was presented to the Supreme Court of Iowa, in the case of State v. Stucker, 58 Iowa, 496, and on page 498, the court said:

"It is very clear that if the regulation or prohibition of the sale of intoxicating liquors is a police power, which may be exercised by the State and without interfering with the prerogative of Congress to regulate commerce among the States, the act in question is not repugnant to article 1, section 8, of the Federal Constitution. Counsel for appellant cites Ward v. Maryland, 12 Wall. 418; Welton v. Missouri, 91 U. S. 275, and other cases in the same court, which hold that a license tax cannot be laid upon the sale of the products of other States while the same products within the State are exempted. These cases are They treat of reg

founded upon a different principle. ulations of commerce proper, and not with mere police regulations.

State v. Distilling Co.

"II. If the State has the power as a police regulation to prohibit the sale of intoxicating liquors, it may, in its discretion, prohibit the sale of one kind of liquor and allow the sale of another kind. It may say that certain wines may not be sold, and that certain other wines may be sold. Because the sale of all things which may be deleterious to the public is not prohibited, is no good reason why the sale of such as are prohibited is invalid. And because the sale of wines manufactured from fruit grown in this State is allowed, and the sale of wines manufactured from fruit grown in Illinois is prohibited, is no invasion of the 'privileges and immunities of citizens of' Illinois; because this State in the exercise of its police authority has the power to determine what kind of intoxicating liquors it will prohibit the sale of, and what kind it will allow.

"We think it is plain that the section of the statute under consideration is not repugnant to article 4, section 2, of the Federal Constitution."

The same question was presented to the Supreme Court of Ohio, in the case of McGuire v. State, 42 Ohio St. 530. The court, on page 535, in speaking through JOHNSON, C. J., said:

"It is settled, that a State in the exercise of its power of taxation cannot impose burdens upon the products of other states imported into the State for sale more onerous than is imposed upon the same kind of articles produced within the State, nor discriminate against citizens engaged in selling them. [Welton v. Missouri, 91 U. S. 275; Guy v. Baltimore, 100 U. S. 434; Tiernan v. Rinker, 102 U. S. 123.] These cases relate to the taxing power of the State, and not to its police power.

"Tiernan v. Rinker is much relied on in the case at bar. It related to the validity of an act by the State of Texas, regulating taxation, which provided for the levy and collection of a tax upon the occupa

State v. Distilling Co.

tion of selling intoxicating liquors, but excepted from such tax 'any wine or beer manufactured within this State.' Following Welton v. Missouri, it is held that this was a discrimination in favor of domestic and against foreign made wines, and therefore this proviso or exception was void. Here was a direct discrimination against a specific article of legitimate com

merce.

"The statute under consideration makes no such discrimination. Wines imported into this State are on an equality with wines made in Ohio. Wherever the article is manufactured, whether within or without the State, it is equally unlawful to sell it, contrary to the act. Wine wherever manufactured, whether within or without the State and imported, if made of the pure juice of the grape, cultivated within this State, is excepted from the operation of the law. There is no restraint or burden placed upon the importation or sale of wines, as an article of traffic. This statute, after the wine has become a part of the general property of the State, undertakes to restrain the retail traffic therein as a beverage. This we think may be done under the authority conferred by the police power, without at all interfering with the freedom of transportation into the State, or a sale thereof by the importers. It is merely a regulation of the internal retail traffic in an article, which the lawmaking power regards as injurious, after it has become part of the mass of property in the State.

"That this law discriminates in favor of pure wine, made from the juice of grapes cultivated in this State, is clear, but it is not an interference with or burden on commerce. In other words, it is a discrimination against adulterated wine, without regard to where it is manufactured.

"In coming to this conclusion we are not unmindful of the importance and difficulty of the question, but since this act has been enforced, and has stood un