Appendix — State Bd. of Equalization of Cal. v. Young's Market Co.

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APPENDIX A

CALIFORNIA ALCOHOLIC BEVERAGE

, CONTROL ACT

Chapter 330, Laws 1935.

. AN ACT to license, regulate and control the manufac-

ture, transportation, sale, purchase, possession and disposi-

tion of alcoholic beverages; to levy an excise tax on the sale .

of alcoholic beverages; to provide for the licensing of the

manufacture, distribution and sale of alcoholic beverages;

‘to prescribe penalties for the violation of this Act; to

make an appropriation for the enforcement of this Act; ~

to take effect immediately. . ,

The people of the State of California do enact as follows:

Section 1. “This Act is known and may be cited as the

“Alcoholic Beverage Control Act.”

Section 2. The following words, terms, and phrases

when used in this Act have the meanings ascribed to them

in this section, except where the context clearly indicates

a different meaning:

(a) “Alcohol’” means ethyl alcohol, hydrated oxide of

ethyl, or spirits of wine, from whatever source or by what-

ever process produced. | o

(b) “Alcoholic “beverage” means and includes alcohol

- spirits, liquor, wine, beer and every liquid or solid contain-

ing alcohol, spirits, wine or beer, and which contains one-

half of one per cent or more of alcohol by volume and which

is fit for beverage purposes either alone or when diluted,

mixed or combined with other substances.

the fermentation of any infusion or decoction of barley,

malt, hops or any other similar product, or any combination

thereof in water, and shall include ale, porter, brown, stout,

ii >

lager beer, small beer and strong beer but shall not include

sake known as Japanese rice wine.

(d)} “Distilled spirits’. means ethyl alcohol, spirits of

wine, whiskey, rum, brandy, gin and other distilled Spirits

for beverage use, including all dilutions and mixtures

thereof. .

(e) “Wine” means the product obtained by the fer-

mentation of grapes or other agricultural products con-

taining natural or added sugar or any such alcoholic

bevera ortified with grape brandy and containing not

more than’twenty-four per cent of alcohol by volume and

shall inelude sake known as Japanese rice wine.

(f) “Person” includes any individual, firrn, copartner-

ship, joint adventure, association, corporation, estate,

trust, business trust, receiver, syndicate or any other group

or combination acting as a unit, and the plural as well as

the singular number.

(g) “Board” means the State Board of Equalization

of the State of California.

(h) “Club” means a corporation or association which

is the owner, lessee or occupant of an establishment oper-

ated solely for objects of a social or athletic nature, having

a bona fide membership list, and the majority of the mem-

bers of which pay dues at least once in every year, bit not

for pecuniary gain, and the property as well as the advan- -

tages of which belong to the members. ;

(i) “Manufacturer” means every person, who within «

the State of California, brews, ferments, distills, cuts,

blends, rectifies, or otherwise processes, produces, or manu-

factures alccholic beverages containing one-half of one

per-cent or more of alcohol by yolume; provided that any -

person who: manufactures not to exceed two hundred -

gallons of wine per year for his own consumption, shall

not, uge of such manufacture, be considered a manu-

facturer within the meaning of this Act.

(j) “Rectifier” means every person who colors, flavors,

or otherwise processes distilled spirits by distillation,

blending, percolating or other processes. :

iii :

(k) “Importer” means every person who, in the case

of alcoholié beverages brought into this State from outside

of this State, is the first in possession thereof within this .

State after the Act of importation is completed.

_ (i) “Sell” or “sale” and the phrase “‘to sell” means

and includes any of. the following: to exchange, barter,

traffic in; to solicit or receive an order for; to keep or ex-

se for sale; to serve for a consideration with or without

meals; to traffic in or deliver for.value or in any way other

than gratuitously; to possess with intent to sell. The

transfer of title to alcoholic beverages unaccompanied by”

a transfer of possession of such beverages shall not be.

deemed a sale of such beverages. - )

(m) “Public bar” means any bar, counter or other

structure over which beverages of an alcoholic content in

excess of four per cent by weight are sold or served by

the drink to the public for consumption ‘on the premises;

provided, however, that counters" or other structures used

for the sale, service and consuimption of meals, and not as

a subterfuge for a public bar, shall not be deemed to be a

public bar within the meaning of this Act. “Public bar-

room” or “public saloon” means any room to which the

public has access in which is maintained a “public bar.”

(n) “Package” or “original package” means any con-

tainer or receptacle used for holding alcoholic beverages

which is corked or sealed with a stub, stopper or cap, or in

any other manner.

(o) “To bottle” or “to package” means to bottle, barrel,

or otherwise place aicohclic beverages in a container.

(p) “Distiller” means a manufacturer who produces

distilled.spirits from naturally fermented material.

(q) “Proof spirits” means that alcoholic liquor which

contains one-half of its volume of pure ethyl alcohol of a

specific gravity of 0.7939 at sixty degrees Fahrenheit, re-

ferred to water at sixty degrees Fahrenheit as-unity.

(r) “Proof gallon” means a gallon of proof spirits, or

an equivalent amount of alcohol. : :

iv >

(s) “Wholesaler” means and includes every person

gother than.a manufacturer or rectifier who is engaged in

business as a broker, jobber or wholesale merchant, dealing

in alcoholic beverages.

(t) “Wholesale sale” or ‘sale at wholesale” means a

sale to any person for purposes of resale.

(u) “Retailer’s on-sale’license” means and includes on-

sale beer licenses, on-sale beer and wine licenses, and on-

sale distilled spirits licenses. .

. (v) “Gallon” or “Wine gallon” means that liquid meas-

ure containing two hundred thirty-one cubic inches.

(w) “Wine manufacturer” means any person engaged

in the manufacture of wine as the term “wine” is defined

in this Act.

(x) “Still” means a still used in the production or cap- *

able of being used in the production of alcoholic beverages,

and does not include stills or apparatus used solely in the

production of distilled water or substances other than

alcoholic beverages.

Section 3. On and after July 1, 1935, no person shall

perform any Act or Acts which would constitute such per-

son a manufacturer, rectifier, importer, wholesaler, or re-

tailer of any alcoholic beverage within the meaning of this

Act or shail package, label or sell any alcoholic beverage

unless such person is authorized to do so by a license duly

issued: pursuant to the provisions of this Act, or pursuant

to the provisions of the State Liquor Control Act, Chapter .

658, Statutes of 1933. Any person violating any provision

of this section shall be guilty of ‘a misdemeanor.

Section 4. On and after July 1, 1935, every still located

within the limits of this State must be registered with the

board. Every person owning or possessing a still who

fails to register the same as herein required or who

. fails to obtain a license issued pursuant to the provisions of

this Act authorizing the ownership and possession of such

still shall be guilty of a felony. ;

* | : Vv

The board may seize and summarily destroy any still

wuaich is not registered or for which a license has not been

obtained as required by this Act.,

- Section 5. . The following are the types of licenses to be -

issued under this Act and the annual fees to be charged

therefor :

1. Beer manufacturer’s license............++-- $750.00 per year

2. Wine manufacturer’s license, one thousand

gallons or less per year.......---+++++++ 5.00 per year

Over one thousand gallons to two thousand -

five hundred gallons per year............ 10.00 per year

Over two thousand five hundred gallons to

five thousand gallons per year.........-- 20.00 per year

Over five thousand gallons to twenty thou-

sand gallons per year...... peevesesecees 40.00 per year

Over twenty thousand to one hundred thou-

sand gallons per year......... edogenanes 75.00 per year

Over one hundred thousand to two hundred

‘ thousand gallons per year.............-- 100.00 per year

Over two hundred thousand gallons to one

million gallons a year.......... Roeedeese 150.00 per year

For each million gallons or fraction thereof | a. eee

over a million gallons an additional....... 100.00 per year

3.. Distilled spirits manufacturer’s license...... 250.00 per year

4. Still license ........... a TTTTTE ehecesee 10.00 per year

' per still

5. Rectifier’s license .........cccccescccccees 250.00 per year

6. Fruit brandy manufacturer’s license........ 150.00 per year .

7. Distilled spirits and wine importer’s license.. 100.00 per year

8. Beer importer’s license 4........ eweeeeee . 500.00 per year

9. Wine bottling or packaging license........ 10.00 per year

10. Distilled spirits bottling or packaging: licen 250.00 per year

11. Beer bottling or packaging license....... ... 500.00 per year

12. Distilled. spirits’ wholesaler’s license........ 250.00 per year .

13. Beer and wine wholesaler’s license...:...... _ §0.00 per year

14. Retail package off-sale beer and wine license —_ 10.00 per year

15. Retail package off-sale distilled spirits license _

~ for the first $10,000 retail sales per year.. 100.00 per year

For each $1,000 retail sales or fraction thereof ‘

over $10,000 per year .........+++eeeee- 10.00 per year

16. Industrial alcohol dealer’s license.......... 50.00 per year

17. On-sale beer license .........:..+-+++---- 25.00 per year

18. On-sale beer and wine license............- 75.00 per year

19. On-sale beer and wine license for trains (per

Ge? QED conccecsacecs CE Utaauakouee praia 15.00 per year

20. On-sale beer and wine license for boats (per —

BREED co cccccccccsccccccvccescnsssgses 50.00 per year

-21. Onesale distilled spirits license........ @ . As set by the board

_ holic beverages to persons holding licenses issued by the

. The fees specified above shall be reduced twenty-five

per cent for each full quarter of a year elapsing between -

' the first day of the year for which the license is fssued and

the date on which the application for the license is filed with -

the board; provided, that where an application clearly indi-

cates that the applicant does not desire to exercise the privi-

leges granted by the license applied for until on or after the

beginning of the quarterly period following the quarterly

period in which the application is filed with the board, such

fees shall be reduced twenty-five per cent for each full quar-

. ter of a year elapsing between the first day of the year for |

which the license is issued and the date ‘so indicated in the

application. | de

Where the fee for any license is graduated according

to the amount of alcoholic beverages manufactured or sold

under the license, and the license is applied for after the

beginning of the year, the amount of alcoholic beverage

authorized to be manufactured or sold under the license

shall be reduced proportionately with the reduction in fee

provided in the preceding paragraph in accordance .with a

‘such rules and regulations as the board may prescribe.

Section 6. Except as otherwise provided in this Act

and subject to the provisions of Section 22 of Article XX.

of the Constitution, the licenses provided for in the pre-

ceding section shall authorize the person to whom issued

to exercise the following rights and privileges and no

others at the premises for which issued during the year -

for which issued. .

(a) Any manufacturer’s license authorizes the person

to whom issued to become a manufacturer of the alcoholic

beverage specified-in the license, to package, mix, flavor.

‘and color and label the same and to export or sell such alco-

board authorizing the sale of such alcoholic beverage; pro-

vided that a wine manufacturer’s license authorizes the

manufacture of grape brandy to be used exclusively for

ortifying purposes by its holder on the premises for which

issued. ~~ , |

vii

(b) A still license authorizes the person to whom issued

to own or possess the number of ‘stills indicated in the

‘license upon the premises’ for which issued. :

issued to cut, blend, mix, flavor; color and bottle distilled

spirits and to export or sell such products to persons hold- ..

ing licenses issued by the board authorizing the sale of

distilled spirits.’ : ae :

- (d) Any importer’s license authorizes the- person to’

whom issued to become an importer of alcoholic beverages

specified in the license and to export such alcoholic beverage.

(e) A bottling or.packaging license authorizes the label-

ing, bottling or -packaging of the alcoholic beverages

spectfied in the license. ‘

‘(f) Any wholesaler’s license authorizes the sale of the

‘alcoholic beverage specified in the license only to persons.

holding licenses’ issued by the board authorizing the sale

of such alcoholic beverage.

; \

(g) An off-sale beer and wine license authorizes the

sale, to consumers only and not for resale, of beer in pack-

ages and in quantities of thirty-one gallons’ or less, per

~—~sale-and the sale of wine in packages and in quantities of

fifty-two gallons or less, per sale for consumption off the

premises where sold. ‘

(h) An off-sale distilled spirits license authorizes the

~ ‘sale, to consumers only and not for resale, of distilled

spirits in quantities of less than five gallons per sale and

in packages of one gallon or less for consumption off the

_» premises where sold. a

(1) An industrial alcohol dealer’s license authorizes.

the sale of undenatured ethyl alcohol or other distilled

spirits in packages of more than one gallon for use in the

trades, professions or industries. A

(j) Any on-sale license authorizes the sale of the alco-

holig beverage specified in the license for consumption on

the premises where sold. An on-sale beer and an on-sale

* . .

beer.and wine license also authorizes the exercise, with

' Fespect to the particular beverage or beverages mentioned °

‘in such license, of the rights and privileges granted by an

_ Off-sale beer and wine license. On trains and boats, under

such licenses, alcoholic beverages may be sold: only to

passengers or employees,

Section 7. Each license issued under this Act shall be-

issued to a specific person, and, except-in the case of licenses

authorizing the sale ofalcoholic beverages on trains or

boats, shall be issued for_a specific location, the principal. -

address of which shall be indicatedyon the license. Separate

licfhses shall be issued-for e of the premises of any

business establishment having more than one location.

Licenses for trains and boats shall be based on the aver- .

age number in actual operation, during the license year, of .

each class of operating units, viz.,.trains and boats upon

which the license privileges are exercised, such average

number to be determined as the board may prescribe.

Each license issued under thig Act is separate and dis-

tinct, shall be nontransferable from one person to another,

and shall be transferable from the premises for which

issued only as may be permitted by the board, upon pay- ~

__ ment of a transfer-fee of five dollars for each license.

Whenever a license certificate issued under the Act is

lost or destroyed, the board shall issue a duplicate license

_ upon the payment of a fee of five dollars.

Sectior 8. All retailer’s on-sale licenses shall be issued

on a calendar year basis arid shall automatically expire at

midnight on the last day of December of the year for

which issued. All other licenses issued under-this“Act

shall be issued on-the basis of q fiscal year commencing

July first and ending June thirtieth, and shall automatically

'_ expire at midnight on the last day of June of the year for.

which issued.

. All licenses issued under the provisions of the’ State

__ Liquor Control Act, Chapter 658, Statutes of 1933, which

- authorize the sale of liquor specified in the licenses for

consumption on the premises shall automatically expire

at midnight on December 31, 1935. ;

mee

i 7 |

e :

All other licenses issued under said Act and all licenses -

issued under the provisions of Chapter 178, Statutes of |

1933, shall automatically expire at midnight on June 30,

1935. One-half the annual fee for any license so expiring

at midnight on June 30, 1935, sltall be allowed-as a credit

against the fee for any comparable license issued under

this Act during 1935. — ,

For failure to reapply for a license prior to the time

- when any license expires, the board may by regulati®n pre-

- scribe that in addition to the license fees specified in Section

5 heceof a penalty of not to exceed twenty-five per cent of

such fees must be paid.

a ws

- Section 9. Upon receipt of any license issued hereunder

the licensee shall sign said license and shall post the license.

_ ina conspicuous place upon the licensed premises., Licenses

issued for trains or boats may, in lieu of being posted upon

_ the train or boat for which issued, be posted in such other

“place in this State as the, board shall designate.

ON Section 10. To obtain.a license under this Act applica-

tion theref8r, accompanied by the license fee therefor, must

made to the board upon a form prescribed by the board.

The application must contain the name of the applicant, and

in the case of a copartnership, the names of the individual:

_ parties, in the case of a corporation. the principal officers

and directors, the location of the premises for which a license

,is applied and such other information as the board may re-

quire to assist it in determining whether the applicant and

mites qualify for a license. The board may require

that the application for any on-sale license be verified under

oath and be endof¥ed by five freeholders or householders

of the city or county in which the applicant resides or the

premises aré located. ; |

Section 11. Upon receipt of an application for a license

_and the license fee the board shall make a thorough investi-

-~ gation to determine whether the applicant and the premises

for which a license is applied qualify for a license. The

__ board must deny an applicagion for a license if either the

e © (s.%° x

applicant or the premises for which a license is applied do

not qualify for a license under this Act. Vou

If an application is denied, three-fourths of, the ficense

fee paid, or an.amount equal to thé license fee paid less ten

dollars, whichever is greater, shall be returned to the appli-

cant and the balance shall be deposited.

age control fund hereinafter created.

_ Section 12. No on-sale distilled spirits license shall be

issued to any applicant who is fot a citizen of the United

ness association is the applicant no, such license shall be

issued to it unless the majority of the members. of the board

of directors and all of its officers who are charged with the

duty of managing, directing or conducting said business, |

are citizens of thie United States. ai

Section 13. The board is specifically authorized to re-

fuse the issuance of on-sale retail licenses for premises

_ located within the immediate vicinity of churches, hospitals,

schools and children’s public playgrounds.

_ Section 14. No retail license shall,be issued to any appli- —

cant for any premises fur which a license has been forfeit

or revoked, during the three months immediately preceding

the filing of such application: ;

in the alcoholic bever- E

_ States; and where a corporation, partnership or other busi- |

Section 15. .No retail license shall be issued for any -

premises which are located in any territory where,the exér-

cise of the rights and privileges conferred by the Rcense is -

contrary to a valid zoning ordinance of any county, city and

county or municipality. unless such premises had been used

in the exercise of. such rights and privileges at‘a time prior .

to the effective date of any such valid zoning ordinance. .

Nothing in this Act contained shall be deemed to inter-

_ fere with the powers of cities, counties, and cities and ceur-

ties, conferred upon them by Chapter 734, Statutes of 1917,

the same being An Act of the Legislature entitled, “An Act

to provide for the establishment within municipalities of dis-

tricts or zones within which the use of property, height of

aye r

Seor

_ improvements and requisite open spaces for light and venti-

lation of such buildings, may be regulated. by ordinance.”

Section 16. No.retailer’s‘on-sale license shall be issued

- tg any person to whom or for any premises for which a

~“manufacturer’s, ‘ importer’s,. wholesaler’s or rectifier’s

license shall have been issued, and no manufacturer’s, im-

porter’s, wholesaler’s or rectifier’s license shall be issued to

any person to whom or for any premises’ for which a

retailer’s on-sale license is issued.

Section 17. No license shall be issued to any applicant

_ for any premises situated more than one mile outside the

limits of an incorporated city or town and within four miles

of any camp or establishment of: men numbering twenty-

five or more, engaged upon or in connection with the con-

“struction, repair or operation of any work, improyement or

/ utility of a public or quasi public character ; provided, how-

‘ - ever, that nothing in this section shall be deemed’ to apply -

to the renewal of any licenses for any premises which have

been established and licensed under thiS Act or under the

State Liquor Control Act, Chapter 658, Statutes of 1933 ~

at least six months prior to the establishment of such camp

or establishment of. men.

\ Section 18. Retailer’s “on-sale beer and wine licenses”

- or “on-sale distilled spirits licenses” shall be issued only to

- bona fide hotels, restaurants, cafes, cafeterias, railroad

dining or club cars, passenger ships or other public eating

places, or bona fide clubs after such clubs have been law-

fully operated for not less than one year.

Section 19. Fruit brandy manufacturer's licenses shall

be issued only to persons holding a wine manufacturer’s

. license.

) Section 20: Industrial alcohol dealers’ licenses shall be

issued only to, persons to whom, and for premises, for

. .. which, either a distilled spirits manufacturer’s importer’s

* _ or wholesaler’s license has been issued.

ra)

Xil

Section 21. Before commencing to engage ir the sale

of any alcoholic beverage at anf premisés, notice of inten

tion to so commence, must be posted in a conspicuors place

at the entrances to such premises.. Licenses will not be

- issued for such premises until suth notice has been so posted

for fifteen consecutive days immediately prior to the issu-’

‘ance of the licenses. The notice herein specified shall be

in such form as the board shall prescribe.

Upon the receipt by the board of an original application

for any license, notice thereof shall immediately be given

by said board to the sheriffs, chiefs of police and district

' attorneys of such locality, and to the city clerks and ‘city

planning commissions in such locality upon request.

Section 22. In the case of any applicant whose license

fee varies with the total amount of alcoholic beverages

manufactured or sold, the applicant shall at the time of fil-

- ing application for license, accompany such application with .

the minimum license fee required,-or such larger fee as the

applicant shall elect. . a8

The licensee shall report quarterly at such time and in

such manner as the board may prescribe, the amount of

alcoholic beverages manufactured or sold during the pre-

ing quarter. :

If any such report shows that the total amount of

_ Alcoholic beverages manufactured or ‘sold during the year

beverages

manufactured or sold as herein required and to pay such

ees when due within ten days of the date

board, shall be considered a violation of this Act, ~

also subject the licensee to an arbitrary assess-

cai

xiii

‘Section 23. Anvexcise tax is hereby imposed upon all

‘beer and wine sold in this State by a manufacturer or im-

porter on or after July 1, 1935, at the following rates: —

(a) On all beer, sixty-two cents for every barrel con-

taining thirty-one gallons, and at a proportionate rate for

any other quantity ; * 3

(b) On ali wire, two cents per wine gallon, and at a

proportionate rate for any other quantity; .

ally or artificially carbonated, three cents per pint or frac-

tion thereof. pric set

Beer and wine consumed by employees.of manufac-

turers or importers upon the premises of such manufac-

turers and importers shall be exempt from tax under such

rules and fegulations as the board may prescribe.

Té shall be presumed, for the purposes of this Act, that

all beer and wine produced, brewed, fermented, or manu-

- factured in this State by a manufacturer, or delivered td a

manufacturer or importer here, has been sold by such manu-

facturer or importers unless proven to the satisfaction of

the board that suclf beverages are stil! in the possession of

such manufacturer or importer, or, prior to the termination

of stich possession, have been lost through evaporation,

leakage, spillage or destruction by the elements.

Section 24. An excise tax is hereby imposed upon all

distilled spirits sold in this State on and-after July 1, 1935,

# the following rates: ; ,

- On all distilled spirits of proof strength or less, two

cents on each bottle containing two ounces or fraction

- thereof ; five cents on each bottle containing eight ounces or

fraction thereof greater than two ounces; ten cents on each

bottle containing one pint or fraction thereof greater than

a half pint; sixteen, cents on each bottle containing one-

fifth gallon or fraction thereof greater than one pint;

twenty cents on each bottle containing one quart or frac-

tion thereof greater than one-fifth gallon; forty cents on

’ each bottle containing one-half gallon or fraction thereof,

“.. greater than one quart; eighty cents on each bottle contain-

Xiv

ing one gallon or’ a thereof, greater than one-half

gallon.

All distilled spirits in excess of proof strength shall be

taxed at double the above.rate. .

Section 25. Every person who engages in’ business as,

or becomes a manufacturer or importer of beer or wine, as .

defined: in this Act, shall be required by the board to file

with said board a bond duly executed by such’ person ag.

princfpal and a corporation such as is mentioned in Section _

1056 of the Code.of Civil Procedure in this State, as surety, - —

payable to the people of the State of California, conditioned

upon the payment of all excise taxes and penalties assessed

against or imposed upon such person, arising out of this

Act.

The bond shall contain the provisions and be in the form

substantially as follows:

“Know all men by Okpiiite:

(i 5 ee eee ee , as principal, and. Pe eee ae a:

_ corporation duly organized and doing business under and

_ by virtue of the laws of............. , and duly licensed for

the purpose of making, giiaranteeing or becoming sole -

surety upon bonds or undertakings required or authorized

by the laws of the State of California, as surety, are held

and firmly bound unto the people of the State of California

in the sum of:.......... ‘dollars ($.......... ), lawful

money of the United.States of America, for the payment

- whereof well and truly to be made, we bind ourselves, our -

_ heirs, executors, successors and assigns, jointly and sever-.

ally, firmly by these presents.

' The condition of the foregoing obligation is such that,

Whereas, the above bounden principal has made appli-

cation to the State Board of Equalization of the State of |

‘California for a licensé authorizing said principal to engage

in business as a manufacturer or importer of beer or wine

Within‘the meaning of the Alcoholic Beverage Contr6l Act

and amendments thereto, and

* Wherd&s, under the terms of said Acta bond is required

of said principal and good and sufficient surety, payable to’

: the people of the State of California, conditioned upon. the

' payment to the State of California of all of the excise taxes

and penalties assessed against or imposed upon said prin-

-cipal arising out of said Act. ‘ . ;

+ aN ow therefore, if the above bounden principal shall pay

‘all excise taxes and penalties assessed against or imposed

_ upon said principal arising out of said’ Act, or if the board,

within thirty days after any default by said principal in the

‘payment of any such tax or penalty shall fail to notify the

surety thereof, personally or by mail, then this obligation .

shall be null and void: otherwise to remain in full force and ©

effect. | : | |

~ ‘That said bond shall remain in force and effect until the

- surety or sureties are released from liability by said board

- or until said bond is canceled by said surety or sureties as

hereinafter provided. 7

The surety herein reserves the right to withdraw as

such surety, except as to any liability already incurred or -

‘accrued hereunder, and may do:so upon giving written

notice of such withdrawal to the State Board of Equaliza- -~

tion; provided, however, that no withdrawal shall be effect-

ive for any purpose until thirty days shall have.elapsed from

and after receipt of such notice by said board; and further

provided, that ‘no withdrawal shall in anywise affect: the

liability of said surety arising out of any sale of beverage

"made by the principal herein prior to the expiration of such -

period of thirty days, regardless of whether or not the excise

tax based upon such sale shall have been due prior to the

expiration of such period. sale ‘

Signed and sealed this...... ee re , 193...

oe ee aoe 6 Ee OR Oe SOO Ee SE Oe SS SSeS S'S S

Saree a eS ea ee ee, ee ee ee

Xvi

The total amount of the bond or bonds required of any

such manufacturer or importer shall be fixed by the board

and may be increased or redyced by said board at any time

subject to the limitations herein provided. In fixing the

total amount of the bond or bonds required of any such -

manufacturer or importer, the board must require a bond

or bonds equivalent in total amount to one and one-half

. times his estimated monthly excise tax determined in such

_manner as said board may deem proper; provid, that the

total amount of the bond or bonds required of any such -

manufacturer or importer shall never be less than five hun-

dred dollars.

Section 26. Every manufacturer or importer of alco-

holic beverages taxable under this Act shall render to the

board on or before the tenth day of August, 1935, and on

or before the tenth day of each month thereafter, a verified

_ Statement of the quantity-of such alcoholic beverage sold

by such manufacturer or importer during the preceding

calendar month. Such statement shall be in such form as

- the-board may prescribe, together with such other informa-

tion as. the board may require.

If any manufacturer or importer shall.fail, neglect or °

refuse to file said report, within the time prescribed for

filing such report, the board must note such failure, neglect

or refusal upon the tax roll hereinafter described, and must

‘estimate the amount of alcoholic beverage sold by said manu-

facturer or importer assessing the excise tax thereon,

adding to said excise tax a penalty of fifteen per cent thereof -

for failure, neglett, or refusal to report. Such’action of

the board shall be final, and subject only to review by a

court of competent jurisdiction. |

The board shall, on or before the twenty-second day

of August, 1935, and on or before the twenty-second day

of each calendar month thereafter, assess the excise tax

due hereunder, and prepare and complete an assessment roll

showing the amount of the excise tax assessed against

each manufacturer and importer and immediately deliver

.Said assessment roll to the State Controller. |

wits ee -

; XVii

Excise taxes herein required to be paid by the manu-.

‘facturer or importer shall be payable in monthly install-

ments to the State Controller for the month ending July .

31,1935, and for each and every calendar month there-

after. ‘The amount of such excise tax for each month shall

be paid on or before the tenth day of the second calendar

month thereafter, and if not paid prior thereto, shall be-

come delinquent at five o’clock in the afternoon of said day,

and ten per cent penalty shall be added thereto for delin-

quency. , ;

Section 27. The board may examine the books and

records of any person required to make said statement, and

may also examine the books and records of any licensee az

herein defined, and such books and records -shall at all

times be subject to the inspection of said board or its rep-

resentatives during regular business hours.

_ If any examination or investigations made by the board

shall disclose that -any reports of manufacturers or im-

porters theretofore: filed with said board by said manufac-

turers or importers pursuant to the requirements of this

Act, have shown incorrectly the amount of alcoholic bever-

‘ age sold or the excise tax accruing thereon, said board shall

have the power and is thereby authorized, to make such

changes in subsequent assessments of said manufacturers

or importers under. this Act as it may deem necessary to ,

correct: the errors disclosed by its examination of the rec-

ords of said manufacturers or importers or its investiga-

tions in pursuance of its powers hereunder.

Section 28. Any person refusing to permit the board

ot any of its representatives to make the inspection for

which provision is made in the preceding section or failing

to keep books of account as may be prescribed by the board

or failing to preserve such books for the inspection of the

board for such time ‘as the board may deem necessary,

and any person altering, canceling or obliterating entries

in such books of account for the purpose of falsifying ‘the

records of sales of alcoholic beverages-madé under this Act

shall be guilty of a misdemeanor and shall be punished by

XVili

@ fine of not less than one hundred dollars nor more than

Ohe thousand dollars, or by imprisonment in the county

jail for not less than one month nor more than six months,

- or by both such fine and imprisonment.

Section 29. No excise tax shall be imposed by this

Act in any transaction whereby any alcoholic beverages

are sold and delivered by a manufacturer or importer to

another manufacturer or importer holding a valid manu-

facturer’s or importer’s license.

In order to obtain the exemption granted under this

section, the manufacturer or importer selling alcoholic

beverages, must present to the board at the time of filing

his monthly report required under Section 26, a verified

statement, in a form to be prescribed by the board, ob-

tained from the purchaser showing the date, kind and quan-

tity of alcoholic beverage sold and delivered to the pur-

chaser, that thé purchaser holds at the time of such pur-

chase, a manufacturer’s or importer’s license, the number

of such license, and such other information as the board

may require.* A copy of this statement must at all times

be kept on file at the place of business of the manufacturer

or importer desiring to obtain the ‘exemption herein

granted.

Section 30. None of the provisions of this Act shall

apply, or be construed to apply, to commerce with foreign

Nations'or commerce with the several States, except in

so far as the same may be permitted under the. provisions

of-the Constitution and laws of the United States nor

shall the excise tax imposed by Section ‘23, of this’ Act

apply to alcoholic beverages sold and actually exported

from this, State by a licensed manufacturer or importer, |

- or bya subsidiary of a licensed manufacturer or importer,

but every manufacturer and importer shall be required to

report such exports to the board in such detail as the board

_ May require, otherwise the exemption herein granted shall’

~ be null and void and such alcoholic beverage shall be con-

- gidered sold in this State subject fully to, the provisions -of

‘this ma *

xix’ |

In support of any exemption from excise taxes aimngd

under this section on account of the exportation of alco-

holic beverage every manufacturer must execute an export

-. certificate in such form as shall be prescribed, prepared .

and furnished by the board containing .a sworn statement 7

made by some person having knowledge of the fact of such

exportation that the alcoholic beverage has been exported

from this State, and giving such detail with reference ‘to

shipment as said board may require. All exportation cer-

tificates must be completed and on: file in the office of the

board within thirty days after the close of the calendar

month in which the shipments were made and no certifi-

cate not completed and filed within such period shall be

recognized for any purpose by the State or any agency.

thereof. The board may demand of any manufacturer

or imiporter such additional data as is deemed necessary

_ by said board in support of any such certificate and failure

to supply such data will constitute waiver of all right to

exemption claimed by virtue of said certificate.

Section 31. In any case in which any tax, interest or:

penalty imposed under this Act is not paid when due the

Controller shall notify the board and may file in the office

of the county clerk of Sacramento County or’ any other

‘county a certificate specifying the amount of the tax, in-

‘terest and penalty due, the name and last known address

, of the manufacturer or importer liable for the same, that

the board has complied with all the provisions of this Act,

in relation to the computation and levy of the tax and a

request that judgment be entered against the manufacturer

or importer in the amount of the tax, interest and penalty

set forth in the certificate. The county clerk immediately

upon the filing of such certificate shall enter a judgment

for the people of the State of California against the manu-

facturer or importer in the amount of the tax, interest and

penalty set forth in the certificate. -The judgment may be

filed by the county clerk in a loose-leaf book entitled .

“Special Judgments for State Excise Tax.”

An abstract of such judgment or a copy thereof may

be recorded with the county recorder of any eed and

xx ~

from the time of such recording, the amount of the taxes, -

interest and penalty therein set forth shall constitute a lien

upon all the real property of the manufacturer or importer

in such county, owned by him or which he may afterwards

and before the lien expires acquire, which lien shall have

the force, effect and priority of a judgment lien. Execution

shall issue upon such a judgment upon the request of the

Controller in the same manner as execution may issue_xipon

other judgment and sales shall be held under such execu- .

tion as prescribed in the Code of Civil Procedure. «In all

proceedings under this section the Controller shall be

authorized to Act on behalf of the people of the State of

California. | :

In the event.that any manufacturer or importer is de+»

linquent 3 payment of the excise tax -herein provided

for, the’ Controller shall notify the board forthwith and

may give notice of the amount of such delinquency by

registered mail to all persons having in their possession or

under their control, any credits ‘or other personal property

. belonging to such manufacturer or importer, or owing any

debts to such manufacturer or importer, at the time of

receipt by them of such notice, and thereafter any person

so notified shall neither transfer nor make other disposition

of stich credits, other personal property or debts until the

Controller shall have consented to a transfer or disposition,

or until twenty days shall have elapsed from and after

the receipt of such notice. All persons so notified must,

within five days after receipt of such notice, advise the

Controller o: iny and all such credits, other personal prop-

erty or debts, in their possessidn under their control or

owing by them, as the case fhay be.

Whenever any manufacturer or importer shall be de- .

linquent in the payment of the excise tax herein provided

for, thé Controller or his duly authorized representative

may proceed forthwith to collect the excise tax due from

such manufacturer or importer in the following manner:

The Controller shall seize any property, real or personal,

of the taxpayer, and thereafter sell at public auction such

property so seized, or a sufficient portion thereof, to pay

the excise tax due hereunder, together with any penalty

“tl : a : aa ; ‘tins

—

tf xd

or penalties imposed hereby for such delinquency, and any

and all costs that may have been incurred on account of

the time and place thereof, shall be given to such delinquent

manufacturer or importer and to all persons appearing of

- record to have an interest in such property, in writing at

> Jeast ten days before the date set for such sale by inclosing

’ in this State if any, and, depositing same in the United .

such notice in an envelope addressed to said manufacturer

or importer at his last known residence or place of business

States registered mail, postage prepaid, and by publication

for at least ten days before the date set for such:sale in a

newspaper of general circulation published in the county

or city and courity in which the property seized is to be

sold; provided, however, that if there be no newspaper of

general circulation in such county or city and county, then °

by the posting of such notice in three public places in such

county or city and county for said ten days period. The

said notice shall contain a description ofthe property to be

sold, together with a statement of the amount of the excise

taxes, penalties and costs, the name of the manufacturer

or importer and the further statentfént that, unless such ex-

cise taxes, penalties’ and costs are paid on or before the

time fixed in said notice for such sale, said property, or

so much thereof as may be necessary, will be sold in

accordance with law and said notice. ©. 2 |

At any such sale,-the property shall be sold by the Con-

troller of by his duly authorized agent in accordahce with

law and said notice, and the Controller shall deliver to the

purchaser a bill of sale for the personal property, and a

‘deed for any real property so sold, and such bill of sale or

deed shall vest title in the purchaser subject to a right of

redemption as prescribed in the Code of Civil Procedure

_ upon sales of real estate on execution. The unsold portion

of any propegty so seized may be left at the place of sale at

the risk of the manufacturer or importer. If, upon any

such sale, the moneys so received. shall exceed the amount

of all license taxes, penalties and costs due the Stat@ from

such manufacturer or importer, any such excess shall be

returned to the manufacturer or importer, and his receipt

such seizure and’sale.. Notice af stich intended sale and -

XXii

therefor obtained; provided, however, that if any person

having an interest in or lien upon the property has filed

with the Controller prior to any such sale notice of such

interest>gaid Controller shall withhold any such excess

pending a determination of the rights of the respective

- parties thereto by a court of competent jurisdiction. If,

for any reason, the receipt of such manufacturer or im-

porter shall not be available, the Controller shall deposit

such excess moneys with the State Treasurer, as trustee for ;

such: owner, subject to the order of such semeenel or

importer, his heirs, successors or assigns.

The Controller must also immediately transmit notice

of such delinquency to the Attorney General who shall at

once proceed to collect all sums due to the State from any

such manufacturer or importer hereunder by bringing suit

against the necessary parties to effect forfeiture of the bond -

or bonds of the manufacturer or importer, reducing any

deficiency to judgment against the manufacturer or im-

porter. —

| It is expressly provided that the foregoing remedies of

the State shall be cumulative and that no action taken by

the board, Controller or Attorney General shall be or be

construed to be an election on the,part of the-State or any | -

of its officers to pursue any remedy hereunder to the exclu- »

sion of any other remedy for which provision is made in

this Act. -

In any suit brought to enforce the rights of the State

hereunder the assessment roll prepared by the board pur-

suant to Section 26 of this Act, or a copy of so mpch thereof

as is applicable in such suit, duly certified by th¢ Controller

showing unpaid excise taxes assessed against any manu-

facturer or importer, shall be prima facie-evidence of the

assessment of the excise tax, the delinquency thereof, the

amount of the excise tax, penalties and costs due and unpaid

to the State, that the manufacturef or importer is indebted

to the people of the State of California in the amount of

such excise tax and penalties therein appearing unpaid and

that all the forms of law in relation to the assessment and

levy of such excise tax have been fully complied with by

all a required to perform administrative duties under

this Act.

Xxiii 2

Section 32. Any action to recover any excise tax levied

pursuant to this Act and paid under protest must be insti-

tuted within sixty days after the payment of such excise

_ tax, and failure to bring suit within said sixty days shall

constitute waiver of any and all demands against this State

on account of alleged overpayment of excise taxes here-

under. No grounds of illegality of the excise tax shall be

considered by the court other than those set forth in the

protest filed at the time of the payment of the excise tax.

If in any such\action judgment is rendered for the plain-

tiff, the amount of\the judgment shall first be credited on

‘any excise taxes due from the plaintiff under this Act, and

the balance of the amount of the, judgment shall be refunded

to the plaintiff. In any such’ judgment, interest shall be

allowed at the rate of six per cent per annum upon the

- amount of excise tax found to have been illegally collected

from the date of payment’of such excise tax to the date of

-allowance of credit on account of such judgment or to a

date preceding the date of the refund warrant by not more

than thirty days, such date to be determined by the Con-

troller.

.. In no case shall any judgment be rendered in favor of

‘the plaintiff in any action brought against the State Treas-

urer to recover any excise tax paid hereunder. when such

action is brought by or in the name of an assignee of the

manufacturer or importer paying said excise tax, or by any

. person, other than the person who has paid such excise tax.

Section 33. The tax imposed by Section 24 of this Act

upon the sale of distilled spirits shall be collected by means

of attaching to each package containing such distilled

spirits a stamp or stamps of a denomination equivalent to

the amount of excise tax imposed upon the sale of the con-

tents of such package. Such stamps shall be attached by

- the holders of on- or off-sale distilled spirits licenses issued

under this Act and by the holders of on-sale licenses for

. liquor other than beer and winé issued under the State

Liquor Control Act, immediately upon opening the original

cases in which the distilled spirits were packed and in which

such ‘disfflled spirits were purchased from the manufac-

XXiV

‘turer, rectifier, importér, or wholesaler. In the case of dis-

tilled spirits not in original cases at the time of purchase

the stamps shall be attached immediately upon bringing

such distilled spirits upon the premises for which such on-

or off-sale licenses are issued.

. Such stamps shall be sold by: the board only to persons

holding valid distilled spirits manufacturer’s licenses, recti-

fier’s g ome distilled spirits and wine importer’s licenses

or distilled spirits wholesaler’s litenses issued under ‘this

Act or the State Liquor Control Act; provided, that until’

July 1, 1935, the board shall sell a sufficient number of ch

stamps, to stamp stocks of distilled spirits on hand, td Be

sons holding valid on- or off-sale licenses for liquor other

than beer and wine issued under the State Liquor Control

Act; provided further, that the board may théreafter, in its

discretion, sell such stamps to such holders of on- or off-sale

distilled spirits licenses as it may determine.

_ On ahd after July 1, 1935, mf distilled spirits delivered

by any manufacturer, r tifier, importer ér wholesaler .of

distilled spirits to any He holding an on- or off-sale -

distilled spirits license issued under this Act or an on-sale

license for liquor other than beer and wine issued under the

State Liquor Control Act, must be accompanied by a suf-

ficient number of stamps purchased from the board, to

stamp the packages, containing such distilled spirits. Every

manufacturer, rectifier, importer or wholesaler of distilled

spirits who delivers distilled spirits in violation of this sec-

tion shall be guilty of a misdemeanor.

Such stamps shall be of such size, type, and character

as the board shall determine; provided, that all such stamps

must be of a character, design, and process which will give

the State the maximum amount o® protection against

counterfeiting. The board shall have full charge and <on-

trol of the issuance, securing, or purchase and of the sale

of all such stamps and shall keep a record of all stamps sold..

At the time such stamps are attached to the packages

of distilled spirits, they shall immediately be canceled by

indelibly writing or stamping thereon the number of the

licensee attaching the stamp and the date of cancellation.

- — 2

” Section 34. On and after July 1, 1935, it shall be un-

lawful for any person holding an on- or off-sale distilled

spirits license issued under this Act, or an on-sale license

for liquor other than beer or wine issued under the State

Liquor Control Act to have upon the premises for which

any such license is issued any distilled spirits unless the

stamps required by this Act to be attached to the packages

of such distilled spirits are so attached to said packages and

canceled as herein required or unless such distilled spirits

are still in the original cases in which such distilled spirits .

were purchased from the manufacturer, rectifier, importer

or wholesaler, and such cases have not been opened since

‘delivery to the premises for which such on- or off-sale

licenses are issued. ae

On and after July 1, 1935, it shall be unlawful for any

person holding an off-sale distilled spirits license issued

under the Act to sell under such license any distilled spirits

unless the stamps required by this Act to be attached to the -

packages of such distilled spirits are so attached to said

packages, and canceled as herein required. “we

On and after July 1, 1935, it shall be unlawful for any

person holding an on-sale distilled spirits license issued under _

this Act or an on-sale license for liquor other than beer and

wine issued under the State Liquor Control Act to serve or

remove any distilled spirits from any packages at the prem-

ises for which such licenses are issued unless the stamps .

ore by this Act to be attached to the packages are so

attached to said packages and canceled .as herein required.

On and after July 1, 1935, it shall be unlawful for any .

person to deliver to any premises, for which an on- or off-

sale distilled spirits license is issued under this Act or for -

which an on-sale licenfe for liquor other than beer or wine .

is issyed under the State Liquor Control Act; any distilled ~

spirits unless the containers of such distilled spirits bear a

label or labels plainly indicating the quantity and proof

strength of the contents of such containers and the name

of the. manufacturer or distributor thereof. - Se,

On and after July 1, 1935, it shall be unlawful for any

manufacturer, rectifier, importer or wholesaler of distilled

‘spirits to deliver to’ any premises for which an on- or off-

*, XXvi

sale distilled spirits license is'issued under this Act or an

_ on-sale license for liquor: other than beer or wine is issued

under the State Liquor Control Act, and it shall be unlawful

for any such on- or off-sale licensee to sell at the premises

for which any such.license is issued distilled spirits in pack-

ages containing more than one gallon.

Any person violating the provisions of this section shall

be guilty of a misdemeanor.

The board may seize and summarily destroy any distilled

spirits found upon any premises in violation of this section.

Section 35. It shall be unlawful for any person other ‘

than the board or its duly authorized agénts or the holder

of a valid distilled: spirits manufacturer’s license, rectifier’s

license, distilled spirits and wine importer’s license or dis-

tilled spirits wholesaler’s license issued under this Act or the

State Liquor Control Att to sell or give away any stamps

_ issyed by the board pursuant to the provisions of this Act

unless such stamps are attached to packages of distilled

spirits as herein required. Any person violating the pro-

visions of this Section shall be guilty of a misdemeanor.

Section 36. Every person who makes, sells, or uses any

. false,or counterfeit stamp or die for printing or making |

stamps which is in imitation of or purports to be a lawful

stamp, or die of the kind before mentioned in this Act, or

who procures the same to be done, and every person who

shall remove or cause to be removed, from any package of

distilled spirits any stamp denoting the tax thereon, with

intent to reuse such stamp, or who with intent to defraud

the State, knowingly uses, or permits to be used any stamp

removed from anotlfer package, or receives; buys, sells,

gives away, or has in his possession, any stamp so removed,

or makes any fraudulent use of any stamp for distilled

spirits, shall be guilty of a felony and shall be fined not less

than one hundred dollars nor more than one thousand dol-

lars, and imprisoned not less than six months nor more than

three years in the State prison.

__ Section 37. All moneys collected as license fees and

under the excise tax Provisiogs of this Act shall be deposited

me AUR ESR ELE DN amen netonpems gate

XXVii

in the State treasury to the credit of the alcohol beverage

control fund, which fund is hereby created. Moneys in said

fund are hereby appropriated as follows:

1. Six hundred thousand dollars for expenditure by

the board in carrying out the provisions of this Act. for

collecting the excise taxes levied by this Act; G

2. Twelve thousand dollars, or so much thereof‘as may

be necessary, for expendittre by the Controller in carrying

out the provisions of this Act requiring the collection of

excise taxes; at

3. - Sixty thousand dollars: to be used by the State De-

partment of Public Hgalth for enforcement work directed

toward preyenting the manufacture, sale or transportation

of adulterated, misbranded or mislabeled alcoholic bever-

ages ;

4. One million four hundred thousand dollars to pay

the salaries and expenses of auditors, inspectors and clerks

employed by the board and to defray the necessary expenses

arising by reason of the administration and enforcement

of the provisions of this Act; |

5. Ten thousand dollars for expenditure by the State

Department of Finance in auditing the revenues and ex-

penditures resulting from the provisions of this Act;

6.. Fifty per cent of .all moneys collected yearly from

fees, to be paid to the counties, cities and counties, and

4 cities of this’State in the proportion that the amount of

the fees collected in the particular county, city and county,

or city bears to the total amount so collected throughout

‘the State, and the State Controller shall, on or before

_March 31 of the year following ‘that in which such moneys

were collected, draw hs warrants upon said fund in favor

_ of the treasurer of each county, city and county, and city -

for the amount to which each is entitled hereunder ;

7. The expenditures authorized by subdivisions 1, 2,

3,4 and 5 of this section shall be made exclusively from the’

‘ remaining fifty per cent of moneys collected from fees and

no part thereof from the fifty per cent of fees payable’ to

‘

: XXViii

counties, cities and counties, and cities under the provisions

ef subdivision 5 of this section.

8. Such amount as is necessary for the allowance of

the refunds provided for in this Act;

9, Any remaining balance to be transferred to the

general fund on the order of the Controller approved by

the board. ,

The moneys to be used by the-State Department of |

Public Health for enforcement work shall be expended as

provided in “An Act preventing the manufacture, sale or

transportation of adulterated, mislabeled or misbranded

food, liquor and drugs, and making: an appropriation,”

approved March 11, 1907. The Director of Public Health

shall communicate. to the State Board of Equalization any

findings which indi¢ate that such Act has been violated

by any holder of a license under this Act. 3

Section 38. The board shall administer all of the pro-

visions of this Act and to that end shall prescribe all neces-

sary rules and regulations to carry out such provisions.

The board shall have the power to.require any report from

any licensee, or transportationgompanies, and to make any

examination of the books and records of any licensee it may

deem necessary to perform its duties under this Act, and for

the performance of its duties shall have all the powers con-

- ferred upon it by Section 3692 of the Political Code.

The members of the board and the persons employed by

the board for the enforcement of the provisions of this

Act shall have the power to administer and certify oaths,

and shall have all the powers of peace officers in, administer-

ing the provisions of this Act. .

The board and persons employéd by it for the enforce-

ment of this Act shall at all times have the right to visit

and inspect any portion of any premises tor which licenses

are issued under this Act or under the State Liquor

Control Act.

Section 39. A written report of a member of the board

or of an employee of the board engaged in the enforce-

in tes sien heal el cocaine) Eben ee

Xxix

ment of this Act disclosing that.an applicant for a license

or the premises for which a license ig applied are not qual-

‘ sed for a license under this Act shall constitute grounds |

for the denial of an application for a license.

Immediately upon the denial of any application for a

license the board shall notify the applicant thereof in writ-

ing. Within ten days after mailing the notice the applicant

may present his written petition for a license to the board.

Upon receipt by the board of a petition for a license in

proper form it shall be referred to a representative of the

board for hearing. :

Protests may be made to the board at any time prior to -

the issuance of a license against either the original issuance.

of a license or the renewal of a license. |

Protests must be in writing and filed in the main office

of the board at Sacramento, and must state one or more

grounds which would authorize the board, to deny or refuse

the issuance of the license. The original copy of the protest

must be verified. unless made by public officers acting in

their official capacity. .

Upon receipt by the board of a protest in proper form

it shall be referred to a representative of the board for

hearing. :

If a license has been issued to the app'icant before

receipt of the protest by the board, the protest shall be

considered as a complaint agains: the licensee and a hearing

had thereon as if a complaint had been filed.

‘Section 40. Complaints may be made to the board by

any person against any licensee. Complaints must be in

writing and must state ené or more grounds which would

authorize the board to suspend or revoke ‘the license or

licenses of the licensee against whom the complaint is

made.

A written report of a member of the board or of an

employee of the board engaged in the enforcement of

this Act, or of a public officer disclosing grounds for the

suspension or revocation of the license or licenses of any

licensee shall be deemed a complaint against the licensee

within the meaning of this Act, even though not in the

_form of a complaint.

XXX

-The original copy of complajnts must be verified unless

made by public officers acting “in their official capacity or

by employees of the board engaged in the enforcement of

this Act.

The following are the grounds which constitute a basis ©

for the suspension or the revocation of licenses:

(a) The violation or the causing or the permitting of

a violation of this Act or of the rules and regulations of

the board by any licensee.

(b) The misrepresentation of a material fact by any

applicant’ in obtaining any license hereurider.

Section 41. Upon receipt by a representative of the

board of a protest, a complaint or a petition for a license,

the representative shall forthwith cause written notice of

the time and place of the hearing ox said protest, complaint

or petition for a license to be given to the protesting or.

complaining party as well as the applicant, licensee or .

petitioner. The hearing shall be set for a date not more

‘than fifteen days nor less than five days subsequent to the

mailing .of the notice and shall be held in the county seat

“9 the county in which the premises of the applicant or

—_ are located.

Enclosed with a copy of the notice of the time and

dae jf hearing sent to the applicant or licensee shall be

a we of the protest or complaint as filed with the board.

—*= a applicant for a license or a licensee

to” Bit efore the representative of the board at the

time set for the hearing, except for the intervention of an

act of God, shall be deemed an admission by him of the |

facts or acts charged in the protest or complaint.and there-

upon the representative of the board shall have the power

to act as if the facts charged in the protest or complaint

were found to be true.

- The board or any member thereof or any representative

appointed by the board to conduct hearings shall have the

power to administer oaths, certify to all official acts, and.

to issue subpoenas for the attendance of witnesses and the

ca oan et ; : OEE EGE APSARA ERO DEALER AINE IY VT ME ELITR BRE me nner

\ | ais

production of papers, books, accounts, documents and

testimony in any inquiry, investigation, hearing or pro-

ceeding in any part of the State. - =‘

Each witness who shall appear, by order of the board

or member thereof or a representative appointed by it, shall

be entitled to receive, if demanded, for each attendance

the same fees and mileage allowed by law to witnesses in.

civil cases in the superior court, which amount shall be

paid by the party at whose request such witness is sub-

poenaed, unless otherwise ordered by the board or the rep-

resentative. When any witness who has not been required

to attend at the request of any party is subpoenaed by the

board, or a member thereof or a representative of the board,

his fees and mileage may be paid from the funds appro-

priated for the use of the board in the administration of

this Act in the same manner as other expenses of the board

are paid in the administration of this Act.

The superior court in and for the county, or city and

county in which any inquiry, investigation, hearing or

proceeding may be held by the board or a representative.

appointed by it shall have the power to compel the attend-

ance of witnesses, the giving of testimony and the pro-

duction of papers, including books, accounts and docu-

ments as required by any subpoena issued by the board or

any member thereof or a representative appointed by the

board.

The board or any representative appointed by it, before

whom the testimony is to be given or produced, in case of

the refusal of any witness to attend or testify or produce

any papers required by such subpoena, may report to the

- superior court, in and for the county, or city and county, in

which the proceeding or hearing is pending, by petition,

setting forth that due notice has been. given of the time

and place of attendance of said witness, pr the production

of said papers, and that the witness hag’ been subpoenaed

_ in the manner prescribed in this Act, and that the witness

has failed and refused to attend.or produce the papers re-

quired by the subpoena, or has refused to answer questions

propounded to him in the course of such proceeding or

+ hearing, and ask an order of said court, compelling the

Xxxii

witness to attend or testify or produce said papers before

the board or representative. The court, upon the petition

of the board or any member thereof or a-representative

appointed by the board, shall enter an order directing the

witness to appear before the court at a time and place to .

be fixed by the court in such order, the time to be not more

than ten days from the date of the order, and then and

there show cause why he did not attend and testify or

produce said papers before the board or representative of

the board. A copy of said order shall be personally served

upon said witness, and service shall not be made by. regis-

tered mail as otherwise provided in this Act.

If it shall appear to the court that said subpoena was

regularly issued by the board or member thereof or a repre-

sentative of the board and the witness was legally bound to

comply therewith, the court shall thereupon enter an order

that said witness shall appear before the board or represen-

tative at a time and place to be fixed in such order, and

testify or produce the required papers, and upon failing to

obey such order said witness shall be dealt with as for con-

tempt of court.

Section 42. All he#tings and investigations before the

board or any representative appointed thereby shall be gov-

erned by this Act and other applicable provisions of law not

inconsistent herewith and in the conduct of said hearing:

neither the board nor any representative appointed by it

shall be bound by the common law or statutory rules of

evidence and procedure, but may make inquiry in such

manner through oral testimony and printed records as is

best calculated to extend the substantial rights of the parties

and carry out jointly the spirit and provisions of this Act.

The board, or any member of the board or any repre-_.

sentative appointed by it, or any party to the action or pro-

ceeding may, in any investigation or hearing before the

board or a representative thereof cause the deposition of

witnesses residing within or without the State to be taken -

in the manner prescribed by law for like depositions in civil

actions in the superior court of this State, and to that end

may compel.the attendance of witnesses and the production

A ,

° -

. ‘

‘ .

a ey ‘ as FAIRE RO REE NCE TEP pee Seer een aS 4

_ XXxXill

- - : 6f books, documents, papers and accounts ; provided that

depositions taken outside of the State may be taken before

any officer authorized to administer oaths.

Section 43. Within ten days after the hearing the rep-

resentative of the board shall certify to the board his find-

ings of ultimate fact whether the protest, complaint or peti-

tion is true or not, and in the case of hearings on cor#plaints |

the representative may make recommendations in respect to

the suspending or revoking of licenses. The findings and

recommendations of the representative shall not be open to

public inspection, either to the applicant, licensee, pro-

testant, complainant or any other person.

Section 44. After the findings of the representative of

the board are filed, the board shall make its decision upon |

the petition for a license, protest or. complaint, and shall

notify the petitioner, protestant, complainant, and licensee

thereof. Within ten days after the mailing of the notice,

the petitioner, protestant, complainant or licensee may peti-

tion the board for a reconsideration of the cause. XSuch

petitions shall be verified unless filed by a public officer act-

ing in his official capacity. | >

Section 45. Within thirty days after receipt by the

board of a petition for reconsideration the board shall itself

rehear the entire-matter de novo and shall thereupon and

within said thirty days either affirm, modify or set aside its .

original order. 3

Section 46. The action of the board upgn a petition for

a license, a protest, complaint, or a petition™for reconsidera-

tion shall be subject to review by any court of competent

jurisdiction. ee

Section 47. The filing of a petition for reconsideration’

with the board shall not be a bar to any application to the

courts for relief and shall not prevent a court from review-

_ ing or setting aside the action of the board upon a petition

for a license, protest or complaint.

XXXIV

Section 48. Service of the notices required by this Act

may be made personally or by mail; if by mail service shall

be made in the manner prescribed by Section 1013 of the

Code of Civil Procedure. - |

Section 49.. Common or private carriers shall transport

alcoholic beverages into the State only-when such alcoholic

beverages are to be consigned to a licensed importer. The

carrier must obtain the receipt of such importer for the

alcoholic beverage so transported and delivered and, if the

consignee refuses to give a receipt and show his importer’s

license to thé carrier, the catrier shall be relieved of all

responsibility for delivering said alcoholic beverage. Where

the consignee is not a licensed importer the carrier shall

immediately notify the board at Sacramento, giving full

details aS to the character of shipment, point of origin,

destination, and address of the consignor and €onsignee and

within ten days such alcoholic beverage shall be summarily

forfeited to the State of California and shall be turned over

to the board for sale at public auction. :

Every person violating the provisions of this section

_ Shall be guilty of a misdemeanor.

Section 50. Postal authorities may refuse delivery of

any shipment of alcoholit beverage originating outside of

this State. Postal authorities may turn such alcoholic

beverage over to the board.. The beverage when received

shall be summarily forfeited to the State, to be sold at public

auction by the board. Every person violating the provi-

sions of this section shall be guilty of a misdemeanor.

Section 51. It shall be unlawful for any licensee to have

upon any premises for which licenses have been issued to

Such licensee any alcoholic beverages other than the

alcoholic beverages which such licensee is authorized to sell

at such premises under the license or licenses issued ©

therefor. : ee

It shall be presumed that all alcoholic beverages found

or located upon premises for which licenses have been.

issued belong to the person or persons to whom such

licenses were issued. - , |

Pad

XXXV

Every person violating the provisions of this Section

shall be guilty of a misdemeanor. The board or its Pépre-

sentatives may either seize and summarily destroy or may

seize’ and sell at public auction any alcoholic beverages

found upon any premises in violation of this section.

The board shall also have the power to seize and sum-

ily .destroy or sell at pubite auction the following alco-

holic beverages;

1. Alcoholic beverages manufactured i in this State by

any person other than a licensed manufacturer, regardless

of where found;

2. Beer and wine upon the sale of which the excise

tax imposed by this Act has not been paid, regardless of

where found;

3. Distilled spirits except (a) distilled spirits located

upon premises for which licenses authorizing the sale of

such distilled spirits have been issued; (b) distilled spirits

consigned to and in the course of transportation to a

licensee holding licenses authorizing the sale of such dis-

tilled spirits; (c) distilled spirits the containers of which

bear the stamps herein required to be attached thereto;

(d) distilled spirits in United States government bonded

warehouses. )

Section 52. Every person who sells, serves or other-

wise disposes of any alcoholic beverage, except beer which

may be so sold, served, or. disposed of, over or at any public

bar or in any public barroom, for consumption on the

‘premises, shall be guilty of a misdemeanor.

’ Section 53. Any person who fails, neglects or refuses

to file any report required to be filed by this Act within ten

— after the report is required to be filed, or who makes

_ any false statement or gonceals any material fact in any

“application for a licensé or in any record, report, affidavit

or claim provided for herein, shall be guilty of a misde-

meanor unless such act is by any other law of this State

declared to be a felony, and upon conviction thereof shall

‘be punished by a fine of not less than one hundred dollars

Sn Pi NaN Mat ge TRE, NRE Mitre Yama

XXXVi

nor more than one thousand dollars, or by imprisonment

in the county jail not less than one month, nor more than

six months, or by both such fine and imprisonment.

Section 54. No manufacturer, rectifier, distiller,

bottler, importer or wholesaler or any officer, director or

agent of any such person shall

(a) Hold the ownership, directly or indirectly, of any

interest in any “on-sale”’ license;

(b) Furnish, give or lend any money or other thing

of value, directly or indirectly, to, nor guarantee the re-

payment of any loan or the fulfillment of any financial

obligation of, any person engaged in operating, owning

or maintaining any “on-sale” premises“ where alcoholic .

beverages are sold for consumption on such premises;

directly, any equipment, fixtures or supplies, other than

alcoholic beverage directly or indirectly to any person en-

gaged in operating, owning or maintaining any “on-sale’

premises where alcoholic beverages are sold for consump-»

tion on such premises, provided that this subdivision shall ~

apply only to manufacturers, bottlers, importers or whole-

salers of products of the brewing industry;

| (d) Furnish, give, lend or rent directly or indirectly

to any person‘any decorations, paintings or signs other

than signs for interior use ef not to exgeed in area six

hundred thirty square inches for use in or about,or in con-

nection with any premises where alcoholic beverages are

sold- for consumption on such premises, or pay money or

any thing of value for the privilege of placing or painting

a sign or advertisement, or window display on or in any

premisés selling alcoholic beverages at retail; .

(e) Own any interest, directly or indirectly, in the busi-

ness, furniture, fixtures, signs, except signs for interior

use mentioned in subdivision (d) herein refrigeration,

equipment or lease in or of any premises operated or main-

tained under any “on-sale” license for the sale of alcoholic

beverages for consumption on the premises where sold; or

a | XXXvii '

own any interest directly. or indirectly, in realty ‘hereafter

acquired upon which such: “on-sale” premises are main-

tained unless the holding of such interest is germijiet in

accordance with regulations of the board.

Any person violating any provision of this section shall

be guilty of a misdemeanor and any holder of any retail

“on-sale” or retail “‘off-sale” license who shall solicit the

violation of the provisions of this section or accept or per-

mit to be accepted on his behalf and with his consent any

of the prohibited matters, articles or acts herein designated

shall be guilty of a misdemeanor; provided, however, that

the provisions of this section shall not apply to any equip-

" ment, fixtures or'supplics furnished, given, lent or sold

prior to the passage of this Act so long as such equipment,

fixtures or supplies remain in the premises in which in-

stalled prior to such time, nor shall the provisions of this

Act apply to carbonic acid gas or tapping accessories if

_ sold at the reasonable open market value and the aggregate -

cost of tapping accessories furnished to any one person

does not exceed $5.00 in any one calendar year. ©

Section.55. No sign or signs, which in whole or in part

advertise any alcoholic beverage, and exceed in area seven

_ huhdred twenty square inches and no sign using the words

“bar,” “barroom,” “saloon,” “cocktail bar” or “lounge,” — -

or words of like or similar import, shall be maintained,

erected, used or placed upon or adjaceht to the outside of -

any building and in connection with any premises therein

licensed to sell alcoholig beverages at retail for consumption

on such premises.

Signs or other advertising matter used in connection

| with the licensed premises of any retailer of alcoholic bever-

ages shall not be of any obnoxious, gaudy, blatant or of-

.fensive nature and shall in no manner contrary to the rules

_Ar regulations of said board obstruct the view of the interior

‘of the premises from the street.

Each and every holder of an “‘on-sale”’ retail license who

. Shall give, sell or otherwise dispense any draught beer, shall,

upon the faucet, spigot or outlet wherefrom such beer is

drawn, attach and keep posted a-clear and legible notice,

2 ‘

- XXXVII1

placard or marker which shall in the English language indi-

cate and declare the name or brand adopted by the manu-

facturer of such draught beer so given, sold or dispensed

by such licens@@, and which notice, placard or marker shali

be so situated as to be clearly legible for a distance of at

least ten (10) feet from such spigot, faucet or outlet to

a person with normal vision, and such notice, sign or placard

shall at all times be so situated’ as to be so clearly legible

from the place where such “on-sale” licensee serves any

customer or fonsumer of such beer, and provided further

that if such faucet, spigot or other drawing device is in a

location not within the room of the place of service and

consumption of such beer, then, and in that event there shall

also be kept posted a similar notice, placard or marker in ©

the place of service and consumption of such beer which

shall truthfully state and. indicate only the kinds and brands

of draught beer actually on sale in the premises of the ‘“‘on-

sale” licensee. ees

Any person who shall violate any of the provisions of

this section, or who shall substitute ‘ential ee different

brand of draught beer from that indicated by any of the

notices, placards or mafkers hereinabove provided for; or

who shall substitute one brand of beer for another, or mis-

represent the. brand or ‘kind of beer served to a consumer,

shall be guilty of a:misdemeanor for such violation or non-

compliance. Any person who sells or otherwise disposes of,

except for éxport, any draught beer containing mere than

three and two-tenths per cent of alcohol by weight and any

person who sells or otherwise disposes of, except Ngr export,

~ any*bottled beer containing more than four per cent of alco-

hol by weight, shall be guilty of-a misdemeanor ; provided,

that this limitation shall not apply to the sale of ale, porter,

brown and stout in bottles bearing labels properly describing

the contents under any licenses,. other than on-sale beer

licenses, issued under this act or the State Liquor Control

Act.

Section 56.° Every person who employs or uses the

iservices of minors in or on that portion of any premiises-

_, which are used for the sale and service of alcoholic bever-

bal XXXiX

ages for consumption on the premises shall be guilty of a

misdemeanor.) - |

Section 57.) It shall be unlawful for any person to pay

or agree to paylany hostess, waitress, entertainer-or other

‘ person a percentage of the receipts: from sales of alcoholic

beverages solicited or made by such hostess, waitress, enter-

tainer or other person a salary or remuneration the amount |

of which is in any way dependent upon the amount or num-*

ber of sales of alcoholic beverages solicited or made by such

hostess, waitress, entertainer or other person. Provided,

that this section shall not prohibit the holders of manu-

facturer’s, tectifier’s or wholesaler’s licenses from employ-

ing and paying salesmen engaged in‘selling or soliciting sales

,. for alcoholic beverages on a commission basis.

Every person who violatés the provisions of this section

-shall be guilty of a misdemeanor. ~

Section 58. Every person who keeps or permits to be

used or suffers to be used any disorderly house or place in

which people abide or to which people resort, to the dis-

turbance of the neighborhood, or in which people abide or

to which people resort for purposes’ which are injurious to

the public morals, health, convenience or safety shall be

-_ * guilty of a misdemeanor. a

- Section 59. Every on- or off-sale licensee who sells,

gives away or furnishes any alcoholic beverage in any elec-

tion district or precinct in any county in the State where ~

an election is in progress, during the hours when by law

the polls are required to be kept open for voting shall be

guilty of a misdemeanor. > | :

Section 60. Except as otherwise provided in this sec-

tion, no person licensed to manufacture, import or whole-

sale any alcoholic beverage shall deliver or cause to be de-

- livered any beer to or for any person holding an on-sale or

off-sale license except ‘between.the hours of six a.m. and

eight p.m. and no such delivery of any alcoholic beverage

shall be made or caused to be made by any such licensee on

Sunday. Alcoholic beverages may be delivered at the plat- |

form of the manufacturing or distributing plant at any time.

Every person violating the provisions of this section shall

be guilty of a misdemeanor.

_ Section 61. Every person who sells, furnishes, gives,

or causes to be sold, furnished or given away any alcoholic —

beverage to any person under the age of twenty-one years

shall be guilty of a misdemeanor ; provided, that this section

shall not apply to the parents or guardians of such persons

under twenty-one years of age.

Section 62. Every person who sells, furnishes, gives

or causes to be sold, furnished or given away, any alcoholic

beverage to any habitual or common drunkard shall be guilty

of a misdemeanor.

Section 63. Every person, not authorized by law, who

brings into any State prison, town or county jail, or city

and county jail, or reformatory in this State or within the

grounds belonging to any such institution any alcoholic

beverage of any kind whatsoever shall be guilty of a felony.

Section 64. Every person who sells, gives or delivers

to any other person any alcoholic’ beverage at any public

schoolhouse or upon any portion of the grounds thereof

shall be guilty of a misdemeanor.. Any person convicted

of a violation of this section shall, in addition to the pen-

alty irnposed for the misdemeanor, be barred from having

or receiving any privilege of the use of public school -prop-

_ erty which is accorded by Chapter II of Part III of Division

VI of the School Code of this State.

‘Section 65. Every person convieted of a misdemeanor

for a violation of any of the provisions of this Act for

which another punishment is not specifically provided for

herein, shall be punished by a fine of not more than five “

hundred dollars or by imprisonment in the county jail for

not more than six- months, or by both such fine and im-

prisonment..

xli

All fines and forfeitures imposed for a violation of this

Act and collected in any court, except police courts, city

justices’ courts, city courts, and recorders’ courts of cities

or towns, must be paid to the county treasurer of the county

in which the court is held; provided, that all fines and for-

feitures collected in any police court, city justice’s court,

_ city court, or recorder’s court, of any city or town that is

maintained and the salaries of the officers thereof paid

by the city shall be paid to the city treasurer of the city in

which such court is located, excepting, however, all for-

feitures collected by the judge of any of said courts when

sitting as a committing magistrate. |

Section 66. Every person convicted of a felony for a

violation of any of the provisions of this Act for which

another punishment is not specifically provided for herein,

shall be punished by a fine of not more than five thousand

dollars or by imprisonment ‘in the State penitentiary for

not less than one year nor more than five years or by both

such fine and imprisonment. |

Section 67. It is hereby declared that this Act shall not

apply to the manufacture, sale of use of completely dena-

tured ethyl alcohol or special dénatured ethyl alcohol, as

these substarices are defined in the various statutes and

regulations of the United States government relating

thereto. | ,

Nothing in this Act shall be deemed to prevent or re- -

strict the use of ‘tax-free ethyl alcohol under regulation

of the Treasury Department of the United States govern-

ment by any governmental agency, State or Federal, or any

scientific university or college of learning or any laboratory

for use exclusively in scientific research or to any hospital

or sanitarium.

Nothing in this Act shall be deemed to prevent or re-

strict the use of tax-free alcohol or of industrial alcohol

or other distilled spirits or wine under regulation of the

United States government in the manufacture of medicinal -

pharmaceutical, or antiseptic products, including prescrip-

tions compounded by retail druggists; of toilet products,

xlii

of flavoring extracts, sirups, of food products, of scientific,

chemical, or industrial products; provided such products

are unfit for beverage use. ~

Section 68. The State Liquor Control Act, Chapter

658, Statutes of 1933, and Chapter 178, Statutes of 1933,

shall remain in effect until July 1, 1935, after which date

said acts shall no longer be of any force and effect; pro-

vided, that any taxes imposed pursuant to Chapter’ 178,

Statutes of 1933, prior to said date shall rémain fully col-

Section 69. The following acts and sections, together

_ with all amendments thereof and all acts supplementary

thereto, are repealed.

YEAR . CHAPTER PaGeE YEAR Coavese PAGE

a 188 240 OE ve is ee 156 161

. 232 193 Se Waxcds cs 240 319

a 223 186 .. ae | = 20

1871-72 .... 188 231 See 123 126

1873-74 .... 13 12 ree 104 127

1873-74. .... 27° 27 i 413 722

1873-74 .... 198 297 ee 351 599

1873-74 .... 300 434 rer 21 20

1873-74 .... 345 ° 509 SAPP Per 80 79

1875-76 .... 473 691 re 89 221

reer 83 80 re 51 340

1889 ...... 241 352 Eee 149 598

eee 8781

PeNnaL Cope. SECTIONS.

63b 397b 680

Po.uiTicaL CopE SECTIONS.

- 3381 a

3383

_ ,_ ScHoot Cope SECTIONS.

3.80 ’ 7

3.81

Section 70. If any section, subsection, clause, sentence

or phrase of this Act which is reasonably separable from

xiii .

the remaining portion of this Act is for any reason held to

be unconstitutional, such decision shall not affect the re-

maining portions of this Act, The Legislature hereby de-

clares that it would have passed the remaining portions of

this Act, irrespective of the fact that any such section, sub-

section, clause, sentence or plfrase of this Act be declared

unconstitutional. .

Section 71. This“Act, inasmuch as it provides for tax

levies for the usual current expenses of the State, shall, |

under the provisions of Section 1 of Article IV of the Con-

stitution, take effect immediately.

Approved, June 13, 1935.

xliv

APPENDIX B ..

‘I FORM OF WEBB-KENYON ACT AS

‘ORIGINALLY PROPOSED.

Senate Bill 4043 (62nd Cong., 3rd Sess.), the original

Bill introduced in the Senate embracing the subject dealt

with in the Webb-Kenyon Act, was first before the Senate ~

for debate on December 16, 1912. In introducing the Bill

for debate it was said:

Mr. Sanders. Mr. President, ca bill 4043, entitled

“A bill to prohibit interstate commerce in intoxicating |

liquors in certain cases,” stripped of its verbiage would

read:

_ Be it Enacted, That the shipment of intoxicating

liquor from one State into any other State by any

person, to be received or used in violation of any

law of such State, is hereby prohibited.

Sec. 2. That all intoxicating liquors transported

into any State shall, upon arrival within the boun-

daries of such State and before delivery to the con-

signee, be subject to the operation of the laws of such

State.

This bill relates to nothing but the shipment of intoxi-

cating liquors from one State into another State where it

is to be sold in violation of State laws concerning same.

_Molupie 49, Congressional Record, page 699)

II. DEBATES STRESSING OBJECT OF BILL AS

AN AID TO STATES IN. EXERCISE OF

POLICE POWER.

Senator Kenyon’s Views on Object and Effect of Bill.

Mr. Kenyon. Now, I think no lawyer who is honest

with himself and perfectly frank will deny that there are

very close constitutional quéstions involved in this bill, and

especially as to section 2. Every forward measure must

run the gauntlet of constitutional objection.

. *

SS . tll

xiv

The evil which this bill seeks to strike at is apparent,

and the purpose, it seems to me, is commendable. Jn_its

ultimate analysis the bill is simply to permit the States *c

exercise their reserved police power without interference by

the Federal Government; in other words, to subject inter-

state commerce in certain articles to the laws of the several

States. (Italics ours.) This.Government is one of dele-

gated powers. It has been asserted by constitutional

writers of great‘eminence that one of the incentive reasons

for the adoption of the Constitution was to give free chan-

nels to commerce and not permit the States by various

regulations to block commerce..

The power of the State in its /reserved police power is

one which Congress does not give and is one which Con-

“gress can not take away. It can not add one particle to or

detract one iota from the police power of the States. These

powers belong to the States; the right to make such laws:

concerning the health, life, and safety of its’ citizens as its

legislative power in its wisdom may determine. This is just

' as much a right in the State as the constitutional right to _

regulate commerce is in Congress. The “police. power

‘zone” of the State, if such an expression might be used,

may at times lap over and intrude upon the “interstate com-

merce zone” of the Federal Government. If such’ conflict

ever does arise, the Federal Government, of course, is

supreme. } | 3

This bill if enacted would not be a law to bring about

prohibition. It would not be a law to stop personal use of.

intoxicating liquors, nor to prohibit the shipment of intoxi-

cating liquors for personal use, nor to-stop the use of intoxi-

cating liquors for sacramental purposes. Jts purpose, and

its only purpose, is to remove the impediment existing as to

the States in the exercise of their police powers regarding

the traffic or control of intoxicating liquors within their

borders: ° ;

It ts the spirit of our times and the genius of our institu-

tions that each State should exercise its police power free

from the impediments that might spring from a narrow

construction of ‘the interstate commerce clause. Where a

State has determined that intoxicating liquors shall not be

xlvi

o . ws

manufactured or sold urthin its borders, 1s it not manifest

that the citizens of other States should not be granted

greater privileges in that State than its own citizenship

enjoy? (Italics ours.)

(Volume 49, Congressional Record, page 707)

Mr. Sherley’s views.

Mr. Sherley. Man after man has stood on the floor here

saying, ‘This bill is simply to give to the State additional

power of control.” I say to, you that whatever power a

State has over any subject within its domain is not because

of the Constitution of the United States, and no act of Con-

gress can grant any power to it that it does not already

have. We live under a: government of delegated powers.

Certain powers have been delegated to the States, certain.

to the Nation, and certain reserved té the people, and dele-

gated neither to the State nor to the Nation. The power

that the Federal Government has over interstate commerce

is plenary. It is absolute within the limits of the Constitu-

tion, and Congress can not by all the declarations under the

sun convey to any single State the slightest power that that

State does. not now have.

(Volume 49, Congressional Record, page 2841)

-Mr. Mondell’s views.

Mr. Mondell. What the legislation does is to subject _

certain articles in interstate commerce to the police power

of the State in order that the State authorities may deter-

-mine whether they are to be received, possessed, sold, or

~ in any manner used in violation of the ‘law of the State.

(Volume 49, Congressional Record, page 2837)

Mr. Houston's views.

Mr. Houston. It is -but aiding local option, with tle

State as the unit, and I think that all agree that the con-

trol of the liqugg_traffic belongs to the States and that the

State in its-exercSe of its police power in local self-govern-

‘ment should be aided as’much as it is possible for Congress

to aid it. b

(Volume 49, Congressional Record, page 2824)

- xivii

Mr. Paynter’s views.

Mr. Paynter. Therefore, Mr. President, when it is

stated in the bill under consideration (or the Wilson bill)

’ that an article at a certain time shall be subject to the police

power of a State. the Congress can not thereby add to the

police power of the State. Such a statement, if viewed

from a Constitutional aspect, can not extend the police

power of the State. It would be more accurate, I think,

if Congress should say that the interstate shipment was

terminated upon delivery of the article. Then there would

be no reference made to the police power of the State and

‘would not appear by words that Congress was endeavoring

to add to the police power of the State. This would be

better, as Congress can neither confer upon or diminish

the police power of the State. In my opinion it is very in-

accurate to make a declaration that at a certain period it

shall be within the police power of the State, because when

the shipment is terminated the police power of the State

takes hold and control of the article that ts shipped.

(Italics ours.) So, as I say, it is very misleading to make

a statement of that kind in the bill. It is not constitution;

ally accurate. It is not the province of Congress to define

the police power of the States. It is the province of Con-

gress to make uniform rules to regulate commerce; not,

however, to confer such power upon the States.

(Volume 49, Congressional Record, pages 2689, 2690)

III. DEBATE RELATING TO CONSTITUTION-

ALITY OF SECOND SECTION AND REASONS

FOR ITS ELIMINATION.

Views on Constitutionality of Second Section.

Senator McCumber. I had stated, if the Senator will

pardon me, when he first called my attention to it, that I

doubted the constitutionality of ection 2 and that I did

not see the necessity of it.. It was no part of the bill when

‘it was introduced, but is a committee amendment. , I think

it is rather dangerous than beneficial. 4t may be open to

xl viii

the construction that it is a delegation of congressional

authority.

_(Volume 49, Congressional Record, pages 702-3). °

Senator Kenyon’s views.

Senator Kenyon. The real difficulty with section 2 is’

this: The section recognizes the transportation of liquors

into the State and then permits the operations of the police

power that might stop the liquor at the State line, thus

keeping it out of interstate commerce. The first section

takes certain liquor out of commerce and the second section

seems to recognize it as being in. There is some incon-

gruity in this. That is the proposition on which I have

had great difficulty in harmonizing my views. |

(Volume 49, Congressional Record, page 830)

Mr. Paynter’s views.

Mr. Paynter. Section 2 is inconsistent with section 1,

as this section allows intoxicating liquor to be seized upon

arrival in a State, regardless of the question of intent of

those who had a direct or indirect interest in it.

(Volume 49, Congressional Record, pages 2687, 2688)

’ Mr. Borah’s views. a

Mr. Borah. My object in the first place was to discuss

principally the second section of the bill. I do not ‘believe

the second section of the bill is constitutional. I believe it

establishes a different rile and involves a different prin-—

ciple from that which is involved in the first section, and it

was my purpose to state why I entertain that view. I shall

not do so, owever, in view of the fact that I understand ~

the parties in charge of the bill are going to offer as a sub-

stitute for this bill the one that passed the house known as

the Webb bill, and which is in effect the first section of

this bill.

Assuming that: probably the substitute will prevail, I

am not going to take time to state why it seems to me the

second section is inhibited by the provisions of the Con. .

stitution. I could not and Shall not vote for this section

a—_,

xlix

in any event—entertaining the view which I do as to its

unconstitutionality.

(Volume 49, Congressional Record, page 2919)

Mr. Kenyon’s views.

‘Mr. Kenyon. Mr. President, a bill was passed in the

House known as the Webb bill. An attempt has been made

to substitute that bill to-day for what is commonly known

_as the Kenyon-Sheppard bill. That has not been success-

ful, but a motion will be made by the Senator from New

Hampshire [Mr. Gallinger] to strike out all after the en-

acting clause and insert in lieu thereof the words of the

Webb bill. I very much hope that that motion may prevail.

(Volume 49, Congressional Record, page 2920)

IV. DEBATE EVIDENCING DIVERGENCE OF

VIEWS IN RESPECT TO CONSTITUTIONAL-

’ ITY OF BILL.

Mr. Kenyon’s Views.

Mr. Kenyon. Senator Nelson, of Minnesota, in his re-

port*some years ago to Congress on this questica, stated

that matter from that standpoint so clearly that I use his

language. He said:

Under the Wilson law the Federal Government

relinquished a portion of its control over interstate

commerce, and under the proposed legislation it pro- -

poses to relinquish an additional portion. In neither

~ case is there a delegation to the State; in both cases

it amounts merely to a declaration on the part of.

Congress that interstate commerce in intoxicating.

liquors shall only be free. to the extent that it does -

not interfere with or embarrass the police power of

the state. * * * :

M r. Sutherland’s Views.

‘Mr. Sutherland. Interstate transportation, as I ufider-

_ Stand, begins when the article is delivered by the consignor.

“in the State from which it is shipped and ends, and only —

ends, when it is delivered to the consignée.in the State to

which it is shipped. Now, if Congress may divest an article

of its interstate character and surrender to the State the

power to regulate it and deal with it as it pleases immedi-

ately after it has crossed the line of the State in which it

is shipped, may it not, by the same reasoning, surrender

the power to the State from which the article is shipped

until the time it reaches the State line? If that be true,

would it not result in Congress surrendering to the two

~ States the whole power of interstate commerce? -

Mr. Nelson’s Views. .

Mr. Nelson. The Senator from Utah’( Mr. Sutherland)

- fails to’ state the entire proposition in its integrity. The

Supreme Court, in-the case of Leisy against Hardin, held

that interstate commerce extended until the consignee had

disposed of the goods in the original package; and in the

case of Rahrer, under the Wilson law, the Supreme Court

held that Congress had relinquished its power over a part

of interstate commerce, to wit, the sale of the unbroken

package. ,

In that case the Supreme Court held that it was not a

delegation of legislative authority, but that under the terms

of the Wilson law the goods had not arrived within the

State until delivery to the consignee. In the case of Leisy

against Hardin the Supreme Court decided that the sale by..--

the consignee in the unbroken package to the retail trade

_ was a part of interstate commerce, and just as much subject

to the protection of Congress as the transit by rail to the

point of destination. . In that case Congress chopped off

a part of interstate commerce; it chopped off the sale in

the unbroken package; and in, section 2 of ‘this bill it is

simply proposed to go a step further. So that the question

~ propounded by the Senator from Utah did not cover the

_ whole case; it did not cover one part of interstate commerce

‘that. was eliminated by the Wilson law.

Mr. Sutherland. Let it cover that element, then, and

then does the Senator from Minnesota say that Congress

El *

Hi \

- has the power to surrender to ‘e State in which the ship-

ment originates the power to regulate it until it reaches the

State line? » - .

Mr. Nelson. There was a surrender in that case of

a part of interstate‘commerce, and there is no reason why.

Congress can not surrender another portion. The question

of the delegation of legislative authority was discussed by

the court in the Rahrer case, and the court held that there

was no. delegation of legislative authority.

* * * * * *" * . O* *

Mr. McCumber. I think the Senator agrees with me

that the only way we can sustain the constitutionality of sec-

tion 2 is on the assumption that Congress has divested the

article of its interstate character the moment that it crosses

the line. Do I correctly understand that to be the Senator’s

position ? fe

Mr. Kenyon. I agree with the Senator from Minnesota —

that a strong argument can be made under the Rahrer case,

_and in the language of the court in the Leisy case, that the

interstate feature may be removed some time in the journey. |

Mr. McCumber. That is correct.

Mr. Kenyon. I do not myself so argue.

Mr. McCumber. That is correct; but it must be in. the

act itseif which divests it of its interstate character.

Mr. Kenyon. That is done by section 1.

Mr. McCumber. I have no doubt of the authority of

Congress to divest it of its interstate character,

_ Mr. Kenyon. I have.no doubt of that. -

Mr. McCumber. But as section 2 now appears is it not

open to the possibility, at least, of a construction that it is

not a delegation of authority and that there is no attempt

to really divest it of its interstate character, and could we

not cure that by a simple amendment, such as was suggested

by Senator Edmunds in the argument which you have just

tread, by a clear and definite declaration that it shall cease

to be an object of interstate commerce the moment it crosses"

the State line? With that declaration, I believe that the

constitutionality.of it may properly be sustained. * * * (Vol.

49, Congressional Record, pp. 829, 8? e.)

lii

APPENDIX C

PRESIDENT TAFT’S VETO MESSAGE.

To the Senate:

I return herewith, without my signature, S. 4043.

The bill, including title and enacting clause, is as fol-

lows: |

An Act divesting intdxicating liquors of their interstate

character in certain cases.

Be It Enacted, etc., That the shipment or trans-

portation, in any manner or by any means whatso-

ever, of any spirituous, vinous, malted, fermented,

or other intoxicating liquor of any kind, from one

State, Territory, or District of the United States,

_or place noncontiguous to, but subject to the juris-

diction thereof, into any other State, Territory, or

District of the United States, or place noncontiguous

to, but subject to the jurisdiction thereof, or from

any foreign country into any State, Territory, or

District of the United States, or place noncontiguous

to, but subject to the jurisdiction thereof, which said

spirituous, vinous, malted, fermented, or other in-

toxicating liquor is intended by any person interested _

therein, to be received, possessed, sold, or in any

manner used, either in the otiginal package, or other-

wise, in violation of any law of such State, Terri-

tory, or District of the United States, or place non-

contiguous to, but subject to the jurisdiction thereof,

is hereby prohibited.

After giving this proposed enactment full consideration,

I believe it to be a violation of the interstate commerce

clause of the Constitution, in that it is in substance and

effect a delegation by Congress to the States of the power

of regulating Interstate commerce in liquors which is vested

exclusively in Congress.

liii

. The most recent expression of the Supreme Court on

the general subject is found in the case of the Loutsville

& Nashville. Railroad Co. v. F.W. Cook Brewing Co. (223 ,

U. S. 70). This was a bill in equity to enjoin the railroad

company from refusing to accept the product of the brew-

ing company at Evansville, Ind., where it was located, for

transportation to local-option or so-called ‘ ‘dry. communi-

ties’ in Kentucky. In delivering the judgment of the

Supreme Court, affirming the action of the circuit court in

. awarding the injunction asked, Mr. Justice Lurton said:

“By a long line of decisions, beginning even

prior to Letsy v. Hardin (135 U. S. 100) it has

been indisputably determined:

a. That beer and other intoxicating liquors are

a recognized and legitimate subject of’ interstate

commerce.

b. That it is not competent for any State to

forbid any common carrier to transport such articles ©

from a consignor in one State to a consignee in

another. »

c. That until stich transportation is concluded

by delivery to the consignee, such commodities do

not become subject to State regulation, restraining ~

their sale or disposition.

The Wilson Act, which subjects such — re

State regulation although still in the original pack-

ages, does not apply before actual delivery to such

consignee where the shipment is interstate. Some

of the many later cases in which these matters have

been so determined and the Wilson Act construed

are: Rhodes v. Iowm. (170 U. S. 412); Vance v.

Vandercook Co. (170 U. S. 438); Heyman v.

Southern Railway (203 U. S. 270); Adams Ex-

press Co. v. Kentucky (214 U.S. 218).

Valid as the Kentucky legislation undoubtedly

- was as a regulation in respect to intrastate ship-

' ments of such articles, it was most obviously never

an effective enactment in so far as it undertook to

liv

regulate- interstate shipments to dry points. Pend-

ing this very litigation, the Kentucky Court of

Appeals, upon the authority of the line of cases

above cited, reached the same conclusion, C. & N.

O. Ry. v. Kentucky (126 Ky. 563).

The obligation of the railroad company to con-

form to the requirements of the Kentucky law, so

far as that law prohibited intrastate shipments, is

clear, and to this extent its circular notification: was

commendable. But the duty of this company, as an

interstate common carrier for hire, to receive for

transportation to consignees upon its line in Ken-

tucky from consignors in other States any com-

modity which is an ordinary subject of interstate

commerce, and such transportation could not be pro-

hibited by any law of the State of such consignee,

inasmuch as any such law would be an unlawful

regulation of interstate commerce not authorized by -

the.police power of the State.

The Wilson Act, referred to by Judge Lurton, provides

as follows: :

That all fermented, distilled, or other intoxicating

liquors or liquids transported into any State or Terri-

tory or remaining therein for use, consumption, sale,

or storage therein shall, upon arrival in such State

or Territory, be subject tothe operation and effect

of the laws of such State or Territory, enacted in

the exercise of its police powers, to the same extent

and in the same manner as though such liquids or

liquors had been produced in such State.or Terri-

tory, and shalt not be exempt therefrom by reason

of being introduced therein in original packages or .

otherwise. res

Chic. Ce *

The Supreme Court, in Rhodes v. Iowe (170 U. S. 423},

construed this language to mean that the legislative author-

ity of the respective States should attach to intoxicating

liquors coming into the States by an interstate shipment,

only after the consummation of the shipment, but before

the sale of the merchandise. The court held that the sight -

of the consignee to sell before delivery was a mere incident

to the shipment, and that it was within the power of Con-

gress to submit the incidental power to sell to the dominion

of State authority.

The court declined to express an opinion as to the author-

ity of Congress under its power to regulate commerce to

delegate to the States the right to forbid the transportation

of merchandise from one State to another. It must be

admitted, therefore, that upon the exact point in question,

to wit, the right of the Congress to delegate to States the

power to forbid the shipment of intoxicating liquors from

another State into its jurisdiction, the Supreme Court has

declined to express an opinion, though it is difficult to read.

the language of the court in the case of Rhodes v. Iowa °

(iz W..S. = ae hoes v. Vandercook Co. (170 VU. S.

438), and of Mr¢Justice Catron in the License Cases (5

Howard, 504, 599) quoted with approval by Mr. Justice

Matthews in Bowman v. Railway Co. (125 U. S. 465, 489)

without inferring that such a delegation of power would

be beyond the power of Congress.

One of the main purposes of the union of the States

under the Constitution was to relieve the commerce between

the States of the burdens which local State jealousies and

purposes had in the past imposed upon it; and the inter-

- state-commerce clause in the Constitution was one of the

chief reasons for -its adoption. The power was there con-

ferred upon Congress. Now, if to the discretion of Congress.

‘is committed the question whether in interstate commerce

we shall return to the old methods prevailing before the

- Constitution or not, it would seem to be conferring upon

Congress the power to amend the Constitution by ignoring

or striking out one of its most important provisions. It was

certainly intended by that clause to secure uniformity in

the regulation of commerce between the States. To suspend

that purpose and to permit the States to exercise their old

authority before they became States, to interfere with com-

merce between them and their neighbors, ‘is to defeat the

constitutional purpose.

- lvi q

This conclusion is sustained in a very careful report pre-

pared by the subcommittee of the Judiciary Committee of

the Senate, of which then Senator Knox was cH&irman. The

coriclusions stated were as follows:

First. Interstate shipments are not completed

until they reach the consignee.

Second. An interruption or interference with

interstate shipments before they reach the consignee

constitutes a regulation of commerce. |

_ Third. Regulating interstate shipments is an

exclusive function of Congress. .

_ Fourth. Congress cannot delegate any part of

its exclusive power to the States.

Fifth. To remove the bar or impediment of ex-

clusive federal power which shuts the States out of

the federal domain is to permit or sanction a state

law in violation of the Constitution and in effect to

delegate a federal function to the States.

I am quite aware that the purpose of this act is to

enable the States more completely to regulate the sale and

use of intoxicating liquors in their respective jurisdictions,

and that a very large part of the good people of each of

such States is strongly in favor of any law which will per-

mit the State to do this, and therefore, that the necessity for

maintaining the Constitutional restrictions in such cases

with reference to interstate commerce is not looked upon

with popular favor in those States. Recognizing this

popular wish, Congress has already gone to the extent of

subjecting the original package in which the liquor is im-

ported to the laws of the State as soon as it is delivered into

the hands of the consignee. It has regulated the commerce

in liquors by forbidding, under sections 238, 239, and 240

, of the Penat Code (1) delivery of intoxicating liquor to any

person other than the consignee, unless upon his written

order, or to any fictitious person; (2) the collection of the

purchase price of intoxicating liquor by any common carrier

acting as agent of buyer or seller; (3) the shipment of any

lvii

liquor unless labeled on the outside to show name of con-

signee, nature of Contents, and quantity contained. These

restrictions must greatly aid the- State authorities in their

enforcement of their liquor laws.

If Congress, however, may in addition entirely suspend

the operation of the inferstate-commerce clause upon a law-

ful subject of interstate commerce and turn the regulation

of interstate commerce over to the States in respect to it,

it is difficult to see how it may not suspend interstate com-

merce in respect to every subject of commerce wherever the

police power of the State can be exercised to hinder or

obstruct that commerce. I can not think that the framers

of the Constitution, or that the people who adopted it, had

in mind for a moment that Congress could thus nullify the

operation of a clause whose useful effect was deemed so

important and which in fact has contributed so much to the

solidarity of the Nation and the prosperity that has followed

. unhampered, nation-wide trade.

But if is said that this is a question with which the

Executive or Members of Congress should not ‘burden

a to consider or decide. It is said that it should

be left to the Supreme Court to say whether this proposed

Act violates the Constitution. I dissent utterly from this

proposition. The oath which the Chief Executive takes,

him any less sacredly to observe the Constitution than the

oaths which the Justices of the Supreme Court take. It is

questionable whether the doubtful constitutionality of a bill

ought not to furnish a greater reason for voting against the

bill, or vetoing it, than for the court to hold it:to be invalid.

The court will only declare a law invalid where its unconsti-

tutionality is clear, while the law maker may very well hesi-

tate to vote fora bill if of doubtful constitutionality because _

of the wisdom of keeping clearly within-the fundamental

law. The custom of legislators and executives having any

legislative function to remit to the courts entire and ultimate

responsibility as to the constitutionality of the measures

which they take part in passing is an abuse which tends to

put the court constantly in opposition to the legislature and |.

executive, and, indeed, to the popular supporters of uncon-

‘ i]

“3

a an

stitutional laws. If, however, the legislators and the execu-.

tives had attempted to do their duty this burden of popular

disapproval would have been lifted from the courts, or at

least considerably lessened. dit

For these reasons, and in spite of the popular approval.

of this bill, I have not felt justified in signing it, because I

feel that under principles of proper constitutional construc--

tion it violates the interstate-commerce clause of our funda-

mental law. . "

I am sustained in the view I have taken by the judgment

and opinion of Attorney General Wickersham, which con-

tains an elaborate discussion of the question and considers

in detail the issues which have been raised in the Congres-

sional debates and elsewhere.

| Wo. H. Tart

" The White House, February 28, 1913.

(Volume 49, Congressional Record, page 4291)

lix

APPENDIX D

DEBATES ON PROPOSED 2lst AMENDMENT

SETTING OUT MORE FULLY THE SUBJECTS

CONCERNING WHICH EXCERPTS ARE

QUOTED IN APPELLANT’S BRIEF.

That the following article is hereby proposed as an

amendment to the Constitution of the United States, which

shall be valid to all intents and purposes as part of the

Constitution when ratified by the legislatures of three-

fourths of the several states:

“ARTICLE —

“Settion 1. The eighteenth article of amendment to

the Constitution of the United States is, hereby repealed.

“Sec. 2. The transportation or importation into any

State, Territory, or possession of the United States for

- delivery or use therein of intoxicating liquors, in violation

of the laws thereof, is hereby prohibited.

“Sec. 3. Congress shall have concurrent power to

regulate or prohibit the sale of intoxicating liquors to be

drunk on the premises where sold. °

: °

~ “Sec. 4. This article shall be inoperative unless it shall

have been ratified as an amendment to the Constitution by

the legislatures of the several States, as provided in the

Constitution, within seven years from the date of the sub-

mission hereof to the States by the Congress.”

(76 Congressional Record, page 4139)

* * * * * *" . Aa

By Mr. Blaine:

“Section 1 is a straight; outright repeal of the

eighteenth amendment. Section 1, if it is incorporated in

the joint resolution, submitted by the Congress, and rati-

fied by the necessary, States, will entirely eliminate the

eighteenth amendment from the Constitution. I need not |

discuss that section. ie :

“Then we have Quggested and offered section 2, which

provides as follows: '

“The transportation or importation. into any

u State, Territory, or possession of the Untted States

for delivery or use therein of intoxicating liquors

> * violation of the laws thereof is hereby prohibited.

“Mr. President, in agreeing to that section I think the

committee was unanimous that the language used" would

effectuate the purpose that is obviousely designed by section

2. It is claimed, however, and I think with some degree

of assurance for the future, that Congress now has the

power to pass laws to.protect the so-called dry States in

regulation of interstate commerce over intoxicating liquors.

A great many laws on that subject have been enacted:

“T will not review those laws in detail. First, however,

we had what is known as the Wilson law. That law was

treated in the case of Rhodes v. Iowa (170 U. S. 412); but

the Supreme Court in that case gave rather a restricted

construction of the language used by the Congress, and

held that’ under the Wilson Act the interstate character

attached to the liquor until it had actually been delivered to

the consignee. In other words, the court held that the

interstate-commerce clause—that is, the power of Congress

to regulate interstate commerce—attached to that com- -

modity not only before it entered the State but after it

entered the State so lorig as it was in process of transporta-

‘tion either by rail, by express, or by any other method,

until the commodity or the intoxicating liquor was in fact

delivered to the consignee.

Titen came an amendment to the Wilson Act, known as

the. Webb-Kenyon Act. The Webb-Kenyon Act was

interpreted by the Supreme Court of the United States in

the case of Clark Distilling Co. v. Western Maryland Rail- -

~ way Co. (242 U. S.-311). The language of the Webb-

Kenyon Act was designed to give the State in effect power

om ‘ > Lxi*

of regulation over intoxicating liquor from the tithe it actu-

ally entered the confines of the State; and the Supreme

Court held that.it was following the doctrine laid down in

the case of Rhodes against Iowa, and necessarily must fol-

ing in the case of Clark against Maryland Railway Co.

Mr. Wagner. Mr. President, will the Senator yield?

Mr. Blaine. I see my able friend from New York

shaking his head. I yield to him.

Mr. Wagner. I do not want to enter into a controversy,

because it really is not very important, but I do not think

the Senator meant to say that by this act Congress delegated

to the States the power to regulate interstate commerce;

Congress itself regulated interstate commerce to the point

of removing all immunities of liquor in interstate com-

merce. : . .

‘Mr. Blaine. I thank ghe Senator. I think he has giveg

the correct statement of the doctrine. My understanding

of the question was identically the same—that it was the

action of the Congress of the United States in regulating

intoxicating liquor that protected the dry State within the

terms of the law passed by the Congress. |

Then, following the Webb-Kenyon Act, was the Reed

“bone dry” amendment. That wentsomewhat further. I

need not discuss that.’ That amendment was sustained by

the Supreme Court in the case of United States v. Hill (248

U. S. 420). . 7 |

In the-case of Clark against Maryland Railway Co.

there was a divided opinion. There has been a divided,

opinion in respect to the earlier cases, and that division of *

opinion seems to have come _dowfi to a very late day. So,

to assure the so-called dry States against the importation

of intoxicating liquor into thoseStates, it is proposed to

write permanently into the Constitution a prohibition along

that line. | 7

Mr. President, the pending proposal will give the

States that guarantee. When our Government was organ-

ized and the Constitution of the United States adopted,

the States surrendered control over and regulation of inter-

state commerce. This proposal is restoring to the States,

lxii :

in effect, the right to regulate commerce respecting a single

commodity—namely, intoxicating liquor. In other words,

the Stafe is not surrendering any power that it possesses,

but rather, by reason of this provision, in effect acquires

powers that it has not at this time.

The committee felt that since the Congress had acted

and had definitely legislated upon this question, while that

legislation had been sustained by the Supreme Court, yet

it was sustained by a divided court, and that we could well

afford to guarantee to the so-called dry States the protec-

tion designed by section 2. .

I afn opposed to the dry States interfering with the so-

called wet states in connection with this question of intoxi-

cating liquor; and so, by the same token, I am willing to

grant to the dry States full measure of protection, and thus.

prohibit the wet States from interfering in their internal

affairs respécting the control of intoxicating liquors.

(76 Congressional Record, pages 4140, 4141)

* * * * * * * * x

Mr. Biaine. Mr. President, my own personal viewpoint

upon section 3 is that it is contrary to section 2 of the reso-

lution. I am now endgavoring to give my personal views.

The purpose of section 2 is to restore to the States by con-

stitutional ameiidment obsolute control in effect over inter-

state commerce affecting intoxicating liquors which enter

the confines of the States. The State under section 2 may

enact certain laws on intoxicating liquors, and section 2 at

once gives such laws effect. Thus the States are. granted

larger power in effect and are given greater protection,

while under section 3 the proposal is to take away from the

States the powers that the States would have in the absence

of the eighteenth amendment. My view therefore is that

section 3 is inconsistent with section 2, and the two sec-

tions are incompatible, and that section 3 ought to be taken

out of the resolution. I made myself clear before the sub-

committee and before the full committee, and made a reser-

vation to that effect.

(76 Congressional Record, page 4143)

* * * * * * * * *

“-_ 4%, | | | ;

Lxili :

‘* Mr. Fess. I think the Senator has answered my ques-

tion, but he goes farther than I feel free to go. In other

words, the second section og the joint resolution that is now

before us ‘is designed to permit the Federal authority to

assist the States that want to be dry to remain dry. I am

in favor of that. The third section is intended to give au-

thority to the Federal Government to prevent the return of

the saloon to the extent of regulating or prohibiting the

. drinking of liquor on the premises where the sale is -

made. * * *

(76 Congressional Record, page 4168)

* * * . * -; . * +

‘ Mr. Walsh of Montana. I wish to say a word, in view

of what has just been stated by the Senator from Florida

in relation to the second paragraph of the joint resolution

as tendered by the committee.

It is true that the original Constitution authorizes Con-

gress to prohibit the transfer of intoxicating liquors in

interstate commerce. It is held, however, that that author-

ity simply indicates the intention to have commerce free

except as Congress may otherwise direct. It has been held |

that under the existing Constitution the right obtains on

the part of any citizen to pass hig goods into another State,

and they remain under the protection of the Federal Con-

stitution until they actually reach the hands of the con-

signee ; so that they can not be stopped at the State line nor

there fall under the jurisdiction of the-State authorities,

but the goods will not fall undef the jurisdiction of the State

- authorities until they actually get into the possession of the-

consignee who may live in the center of the State. Mean-

while all manner of opportunity is afforded for the diver-

sion of the intoxicating liquors from the consignee to whom

they are addressed. Likewise, even then, the intoxicating

liquor is protected by the commerce clause; if it remains

on the siding in the car of the transportation company, it

still remains under that protection, and if it goes into a

warehouse belonging to the transportation company it re-

mains under the protection of the Federal statute, and ‘is

immune from any control by State statutes until it actually

reaches the possession of the consignee. The purpose of

lxiv

the ‘provision in the resolution reported by the committee

was to make the intoxicating liquor subject to the laws of

the State once it passed the State line and before it gets into

the hands of the consignee as well as thereafter. It was so

decided in’a case reported in One hundred and seventieth -

United States Reports, with which, I think, the profession

generally is not particularly familiar.

Mr. Glass. Mr. President, in my own interpretation of

the resolution as I have presented it, there can be no ‘con-

signee of intoxicating liquors in a dry State. Liquors may

be shipped across a State in interstate commerce from one -

wet State to another wet State, but the resolution as I have

drafted it prohibits the shipment of intoxicating liquors into

a State whose laws prohibit the manufacture, sale, or trans-

portation of liquors. So I have met the objection that we

are undertaking to interfere with interstate commerce as.

between States which authorize the manufacture,’ transpor-

tation, and sale of liquors; but there can ‘be no consignee in

dry territory under the terms of my proposed amendment

to the Constitution. |

Mr.. President, at every point in the presidential cam-

paign when submissior of this question was discussed, and *

whenever the objection was raised as to the return of the

saloon, assurances were given that both, parties, with unex-

ampled unanimity, were opposed to the return of the saloon.

The Democratic national platform, in spirit and by sugges-.

tion—indeed, by denunciation—objected to the return of the

saloon. The Republican platform in text insisted upon a

constitutional guaranty against ‘the return of the saloon.

So my joint resolution complies with both the Democratic

and the Republican platforms; and that is the only way you

are ever going to get the question subinitted at all, as‘it

requires a two-thirds vote. Moreover, not only is it the only.

way you are ever going to get it submitted but it is the only

way you are ever going to get it ratified by 36 States of the

Union. | 0

(76 Congressional Record, page 4219)

* . 7 . .* se » x *

Mr. Reed. May.lI preface the question by saying that

.. I am if sympathy with every word the Senator has thus

* far uttered on this subject. |

OOP TESST RE SOE A PT ES nee WOO a Es ne ——

lxv .

‘A good many Senators are obviously bothered by the

continuance of Federal control in this matter; and while

they are anxious to see the saloon outlawed, they would like

to see it done by prohibition on*State action rather than

_+ continuing this unsuccessful Federal effort to carry its

_ police power into the States. I am wondering whether the

Senator feels that the last sentence in section 1 of his amend-

ment is essential. That is the one which gives concurrent

power to Congress. :

‘ Mr. Glass. No;4 do not think it is essential. If I could

be brought to believe that the joint resolution stands a

better chance of passage by the elimination of that sen-

tence, I should be glad to eliminate it, because the balance

of the joint resolution gives us a constitutional prohibition

against the return of the saloon. |

Mr. Reed. That is just what I want to see; and the.

question of the Senator from Florida (Mr. Fletcher) a

little while ago seemed to be animated by the same thought

T had—that there are ‘many votes that would be secured

for the joint resolution if that grant of concurrent power

--to Congress were eliminated.

Mr. Glass. That being so, I should be perfectly willing .

~ to eliminate that one sentence from the measure. 4

want is a constitutional guaranty against the return of

this abominable saloon system of dispensing intoxicating

liquors—that ‘is all—and if we write it into the Consti-

tution I assume that no State would ever even undertake

~ to violate the text of the Constitution by licensing a saloon.

Mr. Reed. Obviously, if it did, its licensing law would

be invalid.

(76 Congressional Record, page 4220)

Ixvi

APPENDIX E

RETALIATORY BILLS AND LAWS.

ILLINOIS.

Senate Bill No. 328, introduced by. Monroe, reads as

follows:

A Bitt For an Act to add Section 2a to Article VI of

“An Act relating to alcoholic liquors,” approved ery

31, 1934, as amended. -

Be it enacted by the People of the State of Ilinvis, repre-

sented in the General Assembly: :

Section 1. Section, 2a is added to Article VI of “An

. Act relating to alcoholic liquors,” approved January 31,

1934, as amended, the added section to read as follows:

ArtTIcLe VI. | }

Sec. 2a. No license shall be issued to a distributor to

import beer manufactured in any State, the laws or rules

or regulations of wh‘ch have the effect of discriminating

against the sale in such State of beer manufactured in

Illinois.

. KENTUCKY.

House Bill No. 42X XX, introduced by Dien April 18,

1936, reads as follows: a

An Act relating to revenue and taxation and nd declaring

an emergency.

Be It Enacted by the General Assembly of the

Commonwealth of Kentucky:

Section 1. When by the laws of any other state any

tax, fee, fine or penalty of any sort whatever is imposed

ecm i lia aca a iD

- Ixvii a

on any goods produced in Kentucky, greater than that im-

posed upon the same or similar goods produced in such other

state, then the same tax, fee, fine, or penalty is hereby im-

posed on any goods produced in such other state and sent

or imported into Kentucky. : .

Section 2. This tax is not intended to apply to goods °

or articles in interstate commerce and they are hereby ex-

pressly excluded from the provisions of this Act.

Section 3. The Department of Revenue of the Com-

monwealth of Kentueky is hereby charged with the enforce-

ment of this Act and it shall have all power necessary to

such enforcement in the collection ef the taxes herein pro-

vided, including the institution of legal proceedings, and to

promulgate such rules and regulations and preseribe: such

forms as it may deem necessary for the enforcement of

this Act. — 5b ae :

Section 4. All laws and parts of laws in conflict here-

with are hereby repealed to the extent of such conflict.

Section 5. Whereas, the Commonwealth of Kentucky

is sorely in need of revenue for the maintenance of the sev-

eral necessary branches of government, an emergency is

hereby declared to exist and this Act shall become effective

- from and after its passage and approval by the Governor.

OHIO.

Chapter 15, Ohio General Code, Section 6064-67,

(Liquor Control Act, 1935), progides as follows:

Sec. 6064-67.—If the laws of another state, territory

or nation, or the rules and regulations of an administrative

body therein, provide for or authorize the levy and collection

of taxes, fees and charges upon or against the products of

Ohio manufacturers of wine or manufacturers or brewers .

of beer and other malt liquors when such products are sold

in, delivered or shipped into such state, — or nation,

- Ixviii

@ i 3

or any part thereof, in excess of the taxes, fees and charges

levied and collected on the products of manufacturers or

brewers of said state, whether such taxes, fees and charges

are in the nature of. an excise, sales or import tax, or by —

whatever name designated, the tax commission’of Jhio is

hereby authorized, and shall levy and collect additional

taxes, fees, and charges on the products of manufacturers

of wine or manufacturers and brewers of beer and other ,

malt liquor of said state, territory or nation when sold in,

delivered or shipped into this state, as hereinafter provided.

PENNSYLVANIA.

_ Public Law No. 15, Pennsylvania Liquor Control Act,’

- (1933) (As Amended and reenacted by Act of July 18,

1935, Act No..399), provides as follows: ae

Sec. 201. General Powers of Board.— * * *

* * * * * x *x * x

‘(b) The board shall require each Pennsylvania manu-

facturer and each non-resident manufacturer of distilled .

liquors selling distilled liquors to the board, which are not

manufactured in’ this Commonwealth to make application

for, and be granted, a permit by the board before distilled

liquors, not manufactured in this Commonwealth, shall be ~

purchased from such manufacturer. Each such manufac-

turer shall pay for such permit a fee which, in the -case

. of-a manufacturer of this Commonwealth, shall be equal

to that required to be paid, if any; by a manufacturer of

of the State, territory, or country of origin of the distilled

liquors, for selling liquors manufactured'in’ Perinsylvania; —_

and in the case of a non-resident manufacturer, shall be

. equal to‘that required to be paid, if any, in such Stage,

‘territory, or country by Pennsyivania manufacturers doing

business in such State, territory or country. In the event

. that any such manufacturer shall, in the opinion of the

board, sell, or attempt to sell, distilled liquors to the board

through another person, for the purpose of evading this

provision relating to permits, the board shall require such _

“/ | Ixix

. person before purchasing distilled liquors froffii him or it

- to take out a permit, and pay the same fee as hereinbefore

required to be paid by such manufacturer. All permit fees

"<0 collected shall be paid into the State Stores Fund;

TEXAS.

The Texas Liquor Control Act, (Laws 1935, Seeond

Special Session, Approved November 15, 1935) Article

II, Section 5(g). provides:

Sec. 5. License fees and regulations. * * *

= «*#:. ‘® * * * * * *

(g) There shall be levied and collected by the Board

on all beer placed in warehouses. or stored in this State an

inspection fee at the rate of Fifty Cents (50c) per barrel;

provided that. any manufacturer. of this State who shall

‘have during the current year paid for a manufacturer’s

license under this Act shall be exempt from payment of the

inspection fee; provided, however, that this inspection tax

- shall not be levieds upon beer manufactured ‘in a-state that

does not levy a similar tax upon beer manufactured in

Texas and sold in such state.

. . :

Ra ,

. ‘ ‘ e

ae ‘ :

" bxx

APPENDIX F

~» *

ANALYSIS OF DISTRICT COURT OPINIONS REN-

DERED BY THREE-JUDGE COURTS SINCE

ADOPTION OF TWENTY-FIRST AMEND-

MENT. .

>. 3 :

Appellants state in argument that since the adoption

of the Twenty-first Amendment, the question presented by

this appeal has been before district courts inegget different

cases, and by some process of reasoning conclude that of

* the eight decisions the question has been determined favor-

ably to appellants’ position in four of the cases. This con-

tention can best be refuted by an analysis of the cases.

One of the opinions referred ta is the “Georgia” opinion.

So far as appellees can ascertain, no such opinion was ever

rendered upon this subject by a District Court of the United

States in Georgia. The refererice of appellants to a Georgia

case apparently results from a mistaken reference of the _

court to such a case in the Premuer-Pabst Sales Company

v. Grosscup, (12 Fed. Supp. 970, E. D. Pa. 1935).

__ The case of Jeseph Triner Corporation v. Arundel, (11

Fed. Supp. 145, D. C. Minn. 1935) is discarded by appel-

lants by the mere staternent that the court declined to pass

upon the application of the 21st Amendment to those states

that recognizéd liquor as an article of commerce, resting

its decision entirely upon a violation of the 14th Amend-

ment. It is true that the’-Court found it unnecessary to

base its opinion upon the Commerce Clause alone, but the

language used by the Court leaves no doubt as to the views

entertained upon that subject. That case involved the con-

struction of a statute of the State of Minnesota forbidding -

the importation by any licensed manufacturer or wholesaler

of any brand of intoxicating liquor containing more than

25 per cent. of alcohol ready for sale without further

processing, unless such brand should be registered in the

United States Patent Office. No like registration of brands

was required of intoxicating faHo manufactured within

the state. It was said by the C

—_ a lxxi

“The contention of the defendants is that chapter

390 represents a proper exercise of its police power .

by the state and is in no respect violative of the Con-

stitution of the United States. They also contend

that, sinct the adoption of the Twenty-first Amend-

ment to the Constitution of the United States, neither

the commerce clause nor the equal protection clause

applies to intoxicating liquor, and that the power to

_ control the manufacture, importation, and use of 9

such liquor was, without any restrictions, conferred

upon the states by virtue of the provision of the

Twenty-first Amendment, that ‘the transportation

or importation into any State, Territory, or posses- .

sion of the United States for delivery or use therein

of intoxicating liquors, in violation of the laws

thereof, is hereby prohibited.’ ,

“With the contention that by this language it

was intended that intoxicating liquors should be ex-

' * cepted from the provisions of the commerce clause

and other provisions of the Constitution of. the

United States, we are unable to agree. The purpose

of the provision referred to was to’ make it im- .

_possible for Congress tg permit the transportation

or importation into any state, territory, or posses:

sion of the United States of intoxicating liquors in >

violation of the laws of the state, territory, or posses-

sion. In other words, the provision left the states,

territories, and possessions free to determine to what ~, _

extent, if at all, intoxicating liquor should be a lawful ~

subject of commerce within their limits.”

The gase of General Sales & Liquor Company v. Becker

_ (14 Fed.-Supp. 348, E. D. Mo. 1936) is apparently thought

by appellants to be. adverse to the contentions asserted in

this case. The propositions therein decided are in entire

harmony with appellees’ position here and are, in fact, in

support of it. The statute assajled limited a non-resident

wholesale dealer in intoxicating liquors to sales to licensed

wholesalers within the state, whereas a resident wholesale.

dealer was free to sell to licensed retailers. The discrimin-

" bxxii

o . .

- ation there complainéd of was one against persons, the

court clearly pointing out that no discrimination was made

under the statute between products. That a state may en-

tirely exclude a nc.-resident from engaging in the sale of ..

. liquors within its borders and limit-sales' solely by residents,

no one will doubt. So holding, the eourt necessarily found

that in limiting a non-resident in the sales which he made

within the state to licensed wholesalers, no discrimination

was made which: was the subject of complaint by him. .

Again, the views of the court expressed upon the question

raised in this appeal admit of no doubt as to the conclusion

that a state statute may not-be so designed as to dis--

¢riminate against the products of another state. It was

said: |

“The adoption of the Twenty-first Amendment

has without doubt limited and qualified the com-

merce clause tg the extent that state laws, regu-

lating the importation of liquor into a state, place no

‘prohibited burden upon commerce. -This conclu-

sion is in complete accord with that of the District

Court in Joseph Triner Corporation v. Arundel, 11

F. Supp. 145, where it was determined that the pur-

pose of the amendment was not to except intoxi-

cating liquors from the provisions of the commerce

clause. The amendment does recognize the author-

’ ity-of the state to regulate the movement of liquor

into. the state, and where availed of, as in this case, |

the importation of intoxicating liquors in violation

of local law is outside the commerce clause.”

The concurring opinion of Circuit Judge Farris clearly

expresses the = of appell@€s in this case, wherein it

js said:

“So, the sole contention here made by plaintiff

_ is that being’ a wholesale dealer, but a non-resident

- of Missouri, it is forbidden dy the Liquor Control

: * Act of Missouri to sell liquor to retail liquor dealers;

while resident wholesale dealers may do so. There:

cannot, I think, be urged as existing any discrimina-

tion. in the statutes attacked, as between liquors of

Lxxill -

foreign manufacture and those of domestic manu-

and distilled spirits of foreign manufacture can be |

sold, and are being sold, in Missouri by. licensed

resident wholesalers, without let or hindrance. So,

I think the sole question in the case is, in the final

analysis, whether the state of Missouri has the right

ander the police power to require by statute that a

‘ wholesale dealer in intoxicating liquor must be a

resident of Missouri. This is conceded by plaintiff

in its brief to be the sole question up for judgment,

for it admits that ‘the sole basis of the discrimina-

tion is resident or non-residence.’ i think the alter-

native, that if such dealer does not see fit to become

a resident ‘of Missouri, then it must sell by or

through such a resident, in no wise affects the prin-

ciple involved. So, I repeat, the discrimination

found in the Missouri statute is not against the

commodities, but solely as to who may be licensed

to sell them, and as seen this discrimination goes

no farther than to require the seller to be a resident

of Missouri. It is a discrimination as Be vesdence

and not one of citizenship, and no reason appears

why ‘plaintiff may not, by becoming a resident of

Missouri, become qualified to sell both domestic or

foreign liquors to retailers; so far, at least, as the

cerned. I am not saying-that the necessity for a

change of domicile might not in some situations be .

a burden on interstate commerce, but not in -this

case. gt ~ f4 7

“Plaintiff bottoms its contention of discrimina-

tion on the alleged violation by the accused statute

of the commerce clause of the Federal Constitution

and of that provision of the Fourteenth Amend-

ment which forbids any state to pass a statute which

deprives any person of the equal protection of the

law. It may urge, of course, both-of the conten-

tions; but not being a citizen, or even a resident of

Missouri, and being a corporation, it may not rely

on any right to an equality with citizens of Missouri,

“<2?

« 2

Lxxiv

under that provision of the Fourteenth Amendment _

which provides for an equality of ‘privilege and im-

munities.’ Aa

“T agree with the view taken by the courts in

the case of Joseph Triner Corporation v. Arundel

(D. C.) 11 F. Supp. 145, and Young’s Market Co.

-v. State Board of Equalization (D. C.) 12 F. Supp.

140, that section 2 of the Twenty-first Amendment

did not have the effect to abrogate the commer€e

clause of the Federal Constitution, in those states .

of the Union which, as is Missouri, are as ‘wide open’

' in the matter of liquor traffic as it is possible to be

and as they were prior to the adoptiou of the

Eighteenth Amendment.” :

Philip Blum & Co. v. Henry (D.C. E. D. Wisc., March

28, 1936), referred to in appellants’ brief (p. 130), involved

a statute of the same design as that involved in the Becker

case. The difference of treatment by the statute was one

relating to persons:and not property. The non-resident

vendor .or licensee was more limited in-the sale of intoxi-

cating liquor than a resident holder of a like license. A ~

statute of this type marks a sharp contrast from a statute

of the type involved in this appeal wherein the commodity is

discriminated against because of its out of state origin.

All that can be said for the case of Premier-Pabst Sales

Company v. McNutt (D. C. Wdd., Jan. 4, 1935), is that

there was a case by such title instituted in the United States

District Court of Indiana, but, following the “submission

of the case and before its decision, the law challenged was

repealed by the Legislature of the State and a new bill was

enacted: Prior to the enactment of the new law, Judge

Baltzell prepared an unsigned memorandum opinion, which

opinion was not concurred in by the other judges.

In Pacific Fruit and Produce Co. v. Martin, decided by

a three-judge court, (D. C. W. D. Wash., Feb., 1936), a .

_ statute of the State of.Washington provided that brewers

‘and beer wholesalers, whose products were sold by license ~

in the State, but whose plant or principal place of business

was located elsewhere, should be deemed to be beer whole-

Oe —

kxxv

salers within the provisions of the law and should obtain.

wholesalers’ licenses. In holding the Act invalid, the court

disposes of the appellants’ contention in this case by the

use of the following languzge:

“The statutes of which particular complaint is

made, Section 2 of Chapter 158 of the Session Laws

of 1935 and Section 3 of Chapter 174, of the Ses-

sion Laws of 1935, if construed and applied as de-

scribed in the bill of complaint, in conjunction, vio-

late the commerce clause, Article 1, Section 8, Clause

3 of the Constitution of the United States, unless the

clause, insofar as interstate commerce in intoxicat-

ing liquor, is concerned. This it did not~do.

Young's Market Co. v. State Board of Equaitzation,

12 F. Supp.. 140; Joseph Triner Corporation V.

Arundel, 11 F. Supp. 145.

“While it may be conceded that the intent of the

Wilson Act, 26 Stat. 313, the Webb-Kenyon Act,

37 Stat. 699-49 Stat. 877, the Act of March 22nd,

1933, 48 Stat. 19, Sec. 6, referred to in defendants’

- brief as the ‘Collier Act,’ repealed and in part re-

enacted, 49 Stat. 877, Sec. 202 (a) and (b), and

the Twenty-first Amendment, was to take from in-

toxicating liquor the protection of the interstate

commerce laws insofar as necessary to deny them

an advantage over the intoxicating liquors produced

in the state into which they were brought, yet, none

of them show an intent or purpose to so abdicate

control over interstate commerce as to permit dis-

crimination against the intoxicating liquor brought

into one state from another.

“Tt has been contended, tipon behalf of defend-

ants, that Section 2 of Chapter 158, supra, of which

complaint is made, .does not so discriminate. With .

this contention we are unable to agree. This enact-

ment, in the case of intoxicating liquor made and ,

purchased without the State, denies to the owner the

right to use it as he could use it if made within the

Ixxvi

state. If made within the state both the owner

the state could reach the manufacturer and com-

pel observance of its law or obtain relief for its

violation, but neither the owner nor the State +has

such power over the outside manufacturer who in

no way is within the state. " |

“Tt follows that Section 2 of Chapter 158, supra,

is void, not only because it violates the commerce

clause, Article I, Section 8, Clause 3, but also the

Fourteenth Amendment, in that its endorsement, as

proposed, would take.from the plaintiff its property

without due process of law, and also in that it denies

plaintiff the equal protection of the law. Young’s

Market Co: v. State Board of Equalization, 12 F,

Supp. 140. . |

“If the decision of the District Court for the

Eastern District of Pennsylvania, in Premier-

Pabst Sales Corp. v. Grosscup, et al., 12 F. Supp.

970, is opposed to any of the conclusions which we

have reached we feel constrained, both upon reason

and the persuasiveness of the authorities herein

cited, to so hold without qualification. * * *

“The orderly and secure regulation of the manu-

facture and sale of property in each of the states

by such states and of the regulation and fostering

of commerce between them require that neither

trammel nor encroach upon that authority which

belongs to the other. The authority of neither is

to ‘be extended by construction of constitution or

statute beyond what is clearly implied from the

recopnized authority of each. This enactment at-

tempts to reach beyond the State’s actual authority

and take something from that ef the nation, a sister

‘ state and the individual.”

The case of Premier-Pabst Sales Company v. Grosscup,

(12 Federal Supplement 970, D. C. E. D. Pa. 1935), is

concededly adverse to the position of the appellees in this

case. The decree of the trial court dismissing plaintiff’s

bill was affirmed by this Court solely on the ground that no

Ixxvit

justiciable controversy was presented by appellants m that —

‘t was in no position to complain of the discrimination of.

the statute. As evidenced by the language of the court in

the Pacific Fruit case, appellees are not alone in their dis-

agreement with the logic of that opinion.

Thus, an analysis of the cases, important to this Court

only for the logic and reasoning employed, discloses that

but one of the six cases decided since the adoption of the

Twenty-first Amendment holds to the contrary of appel-

lees’ position. No importance may be attached to the denial

of the petition for certiorari by this Court in the case of

Rosen v. Fry, 296 U. S. 526. The petition was denied

on the ground that there was not properly presented a sub-

stantial federal question, this not because there was no sub-

stantial federal question involved, but because it was not»

properly presented. The fourth paragraph of the petition

referred to in appellants’ argument discloses the very legal

insufficiency of such petition to raise the federal question

before this Court.

lxxvili

APPENDIX G

The following statement from an Article by D. O.

McGovney, now Dean of California Law School, in 3 Iowa

Law Bulletin 145, May, 1917:

(4852)

“Can a state prohibit receipt within the state

or transportation into the state of interstate liquor .

while leaving open traffic in home produced liquor? _

The Webb-Kenyon Law, taken literally, seems to

permit this. It will doubtless be held, however, that

it is not within the intention of the statute to deprive

transportation of intoxicants into such a state of

its interstate character. See the similar holding as ~

U. S. 58, ye at law was not intended to confer

upon any state the power to discriminate injuriously .

against the products of other states, * * * evidently _

equality or uniformity of treatment under state laws

was intended.’ See also the dictum in Plumley v.

Massachusetts, (1894)-155 U. S. 461, 471.” ~

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.