Bernstein v. City of Marshalltown

The defendant-appellant, city of Marshalltown, is a municipal corporation organized under the laws of Iowa, and the other defendants-appellants are, respectively, the mayor, clerk, and members of the council of said city.

For some years, the plaintiff-appellee, A.H. Bernstein, has been a resident of the city of Marshalltown. He there operates a wholesale and retail newspaper and magazine business. In conjunction with that business, the appellee desired to sell cigarettes and cigarette papers. Accordingly, on January 12, 1931, he filed with the city clerk of Marshalltown his application for a permit to sell cigarettes and cigarette papers, in an attempt to comply with section 1557 of the 1931 Code. That section provides:

"No person shall sell cigarettes or cigarette papers without first having obtained a permit therefor in the manner provided by this chapter [chapter 78 of the 1931 Code, section 1552 et seq.]. Such permit may be granted by resolution of the council of any city or town under any form of government and when so granted, may be issued by the clerk of such city or town. If issued to a person for use outside of a city or town such permit may be granted by resolution of the board of supervisors and when so granted shall be issued by the auditor of the county. Such permit shall remain in force and effect for two years following the July first after its issuance, unless sooner revoked."

Immediately following the foregoing section of the statute is section 1558, which reads:

"Such permit shall:

"1. Be granted only to a person owning or operating the place from which sales are to be made under the permit.

"2. Not be transferable.

"3. Be numbered and show the name and the residence of the person to whom granted and the place of business of the holder where sales are to be conducted under said permit."

When the appellee submitted his application for the permit to the city council of Marshalltown, it was rejected. Consequently the appellee, on January 17, 1931, instituted the present proceedings for a writ of mandamus to compel the city of Marshalltown, its clerk and council, to issue the permit.

In response to the appellee's petition, the appellants answered, and the cause was tried in the district court. As a result of that trial, the writ of mandamus was issued, requiring the city of Marshalltown, its clerk and council, to grant the appellee the permit. From the judgment thus entered, the appellants appeal.

[1] I. It is argued by the appellee that permits to sell cigarettes and cigarette papers had been granted by the appellants, under section 1557 of the 1931 Code, to other persons in Marshalltown. These permits, the appellee declares, are in full force and effect, and are being used by the respective permittees. Such was the situation, the appellee says, when he made the application for the aforesaid permit. So the appellee concludes that the city of Marshalltown, having elected to permit the sale of cigarettes and cigarette papers within its jurisdiction, must thereafter issue permits to anyone applying therefor.

On the other hand, it is argued by the appellants that the fact that permits to sell cigarettes and cigarette papers may have been issued to others is no criterion for the proposition that a similar permit must be issued to the appellee. Under the sections of the Code involved, there is contemplated an independent action of the city council in issuing a permit to each separate applicant. There is nothing in the legislation to indicate a general action by the city council in the nature of a blanket resolution to cover every application presented then and in the future, regardless of the circumstances surrounding each applicant. According to the statute "no person shall sell cigarettes or cigarette papers without first having obtained a permit therefor in the manner provided by this chapter." Clearly there is not a hint in the statute that a general resolution by the city council shall apply to all applicants, regardless of the individual merits of each. When an individual application for a permit has been granted, the fact must, under section 1560 of the same chapter, in each case be certified to the treasurer of state.

The whole history, theory, and purpose of the statute indicates that each individual application is to be considered on its merits. Taking into consideration, as we must, the history, theory, and purpose of the statute, it is plain to see that the permit is a trust granted by the proper local authority. It is a trust to do, under certain limitations, a thing otherwise forbidden by law. A permit, therefore, renders the holder immune from prosecution for that which, but for the permit, would be a public offense.

Our legislature, acting under the police power of this state, declared the sale of cigarettes and cigarette papers objectionable and against the public policy of this state. Such declaration of the legislature is still in effect. Section 1557, above quoted, therefore, is distinctly and essentially a police regulation. By the very terms of the statute, the duty is imposed upon the city council (or board of supervisors) to determine whomay be thus rendered immune from criminal prosecution. Evidently the legislature used the word "may" advisedly and intentionally. As said in Kelley v. City of Cedar Falls, 123 Iowa 660, reading on page 661, 99 N.W. 556, 557:

"The primary or ordinary meaning of the word ``may' is undoubtedly permissive and discretionary. Century Dictionary. And in a statute or ordinance it can be construed in a mandatory sense only ``when such construction is necessary to give effect to the clear policy and intention of the legislature; and where there is nothing in the connection of the language or in the sense or policy of the provision to require an unusual interpretation, its use is merely permissive and discretionary.' 20 Am. Eng. Enc. of Law (2d Ed.) 237; Downing v. City of Oskaloosa, 86 Iowa 352, 53 N.W. 256; Bouvier's Law Dict. 218."

The following cases sustain the rule announced in Kelley v. City of Cedar Falls, above quoted: Queeny v. Higgins, 136 Iowa 573, local citation 574, 114 N.W. 51; Downing v. City of Oskaloosa, 86 Iowa 352, 53 N.W. 256; Lyons v. Gram, Commissioner of Labor Statistics, etc., 122 Or. 684, 260 P. 220; Doben v. Board of Health of City of Paterson, 127 A. 38, 3 N.J. Misc. 38; Samuels v. Couzens, Mayor, 215 Mich. 328, 183 N.W. 925; People ex rel. Dorr v. Thacher, 42 Hun, 349 (N.Y. 1886).

[2] There is nothing in the purpose or context of the statutes under consideration to indicate that the legislature intended the word "may" to mean "shall" or "must". The necessity for giving the word "may" such an extraordinary or unusual meaning is not present. On the contrary, there is every indication in the context of the statutes, and in the purpose and history thereof, that the legislature intended "may" to express, as it generally and ordinarily does, the thought of discretion. This conclusion is supported by the following, as well as by the foregoing, considerations.

When acting in the premises, the legislature was dealing with police regulation of cigarettes and cigarette papers, the sale of which under the public policy of the state, as declared by the legislature, is considered illegal and dangerous to the public health and morals. So, when the appellee made application for a permit, he was not demanding an absolute right, but rather asking for a privilege as a matter of grace. State v. Nossaman,107 Kan. 715, 193 P. 347, 20 A.L.R. 921; West v. Bishop, Judge, 110 Iowa 410,81 N.W. 696.

"The power given to a municipality to license and regulate an occupation or privilege imposes no obligation on it to grant any licenses; but includes the power to refuse a license in a particular case, even where the statutory or preliminary requirements are complied with." 37 Corpus Juris 182, section 28. See, also, section 29.

For supporting authorities, see 37 Corpus Juris 187, 188, section 37; 37 Corpus Juris 240, section 97; 15 Ruling Case Law 306, section 63; State ex rel. and to Use of Oetker v. Johnson et al., Judges (Mo.App.) 211 S.W. 682; Noble v. English, 183 Iowa 893,167 N.W. 629; Cecil v. Toenjes, 210 Iowa 407, 228 N.W. 874; Marquis v. City of Waterloo, 210 Iowa 439, 228 N.W. 870; Talarico v. City of Davenport, 215 Iowa 186, 244 N.W. 750; Gundling v. City of Chicago, 177 U.S. 183, 20 S. Ct. 633, 44 L. Ed. 725; Taylor v. Smith, 140 Va. 217, 124 S.E. 259; Yee Bow v. City of Cleveland, 99 Ohio St. 269, 124 N.E. 132, 12 A.L.R. 1424; Tighe v. Osborne, 150 Md. 452, 133 A. 465, 46 A.L.R. 80; Burgess et al. v. Mayor and Aldermen of the City of Brockton, 235 Mass. 95,126 N.E. 456; State ex rel. Labovich et al. v. Redington, City Clerk,119 Minn. 402, 138 N.W. 430; People ex rel. Schwab v. Grant, Mayor, 126 N.Y. 473, 27 N.E. 964; Austin v. State, 101 Tenn. 563,48 S.W. 305, 50 L.R.A. 478, 70 Am. St. Rep. 703; State v. Packer Corporation, 77 Utah 500, 297 P. 1013; Adams v. Stephens, Clerk,88 Ky. 443, 11 S.W. 427; State v. Thompson, 160 Mo. 333,60 S.W. 1077, 54 L.R.A. 950, 83 Am. St. Rep. 468; State ex rel. Smith v. Town of Ravenswood, 104 W. Va. 614, 140 S.E. 680; Thorpe v. Mayor Aldermen of the City of Savannah, 13 Ga. App. 767, 79 S.E. 949; State ex rel. Brown v. Stiff, Mayor, 104 Mo. App. 685,78 S.W. 675 (Court of Appeals at Kansas City, Mo.); State ex rel. Crumpton v. Montgomery et al., 177 Ala. 212, 59 So. 294; Columbus City v. Cutcomp, 61 Iowa 672, 17 N.W. 47; State v. United States Express Co., 164 Iowa 112, local citation 137, 145 N.W. 451. See City of Burlington v. Bumgardner, 42 Iowa 673; Council of Montgomery v. Kelly, 142 Ala. 552, 38 So. 67, 70 L.R.A. 209, 110 Am. St. Rep. 43; Burlington Henderson County Ferry Co. v. Davis, 48 Iowa 133, 30 Am. Rep. 390.

As said in People ex rel. Schwab v. Grant, Mayor (126 N.Y. 473,27 N.E. 964), reading on page 967, supra:

"A power to grant a privilege by one is inconsistent with the possession on the part of another of an absolute right to exercise such privilege. The requirement that a person must secure leave from some one to entitle him to exercise a right, carries with it, by irresistible implication, a discretion on the part of the other to refuse to grant it, if, in his judgment, it is improper or unwise to give the required consent."

The above and foregoing cases include discussions of applications to sell cigarettes and many other analogous articles of merchandise as well. Likewise, those cases discuss applications to engage in various occupations.

A distinction may be found in the books between an application to do a thing which is prohibited by the police power and an application under a general power to license, regulate, and tax useful occupations and privileges. 27 Corpus Juris 183, section 29.

Evidently, therefore, because of all the reasons above suggested, the legislature advisedly used the word "may", and clearly intended that the city council should have a discretion to grant or deny the application for a permit to sell cigarettes. Under the legislation, the local authorities are burdened with a great responsibility. It is that of granting immunity to persons who otherwise would be guilty of a public offense. Such responsibility under the statute involves more than merely ascertaining whether or not the applicant "owns or operates the place" where the cigarettes are to be sold. See section 1558, supra. According to the legislation, a permit, when once issued, remains in force and effect for the period of two years following July 1 after its issuance. If the appellee is right in his contention, then, after said council once decides to issue permits to sell cigarettes and cigarette papers, that council and all succeeding councils must grant every application for such permit. Then, by electing to grant cigarette licenses, a current city council would bind itself as well as future city councils to issue such licenses regardless of the fitness of the applicant to receive the same. A future council, under the facts contemplated, would be helpless to limit the number of permits or to refuse to renew permits already issued, even though such future council unanimously felt that there should be no permits in the municipality.

The law certainly does not contemplate that one city council can thus bind future city councils for all time in a matter of this character. Manifestly, the statute was intended to make the granting of a permit a personal and individual matter between the particular applicant and the city council to whom the application is addressed. When the application is thus made, the city councilmay, under the statute, grant or refuse a license according to its discretion.

[3] Section 12441 of the 1931 Code provides:

"Where discretion is left to the inferior tribunal or person, the mandamus can only compel it to act, but cannot control such discretion."

As before explained, the city council in the case at bar acted on the appellee's application for the permit to sell cigarettes and cigarette papers. It refused to grant the permit. Consequently the discretion of the city council in that regard cannot be controlled by mandamus. Cecil v. Toenjes (210 Iowa 407), supra, local citation 414, 228 N.W. 874; Sweitzer v. Fisher, 172 Iowa 266, local citation 272, 154 N.W. 465, L.R.A. 1916B, 611; Federal Contracting Co. v. Webster County, 153 Iowa 362, local citation 367, 133 N.W. 765.

II. But it is said by the appellee that the action of the city council in the premises is arbitrary and capricious, and therefore the general rule above announced does not apply. There are circumstances under which it has been held that a city council or similar body may not unlawfully discriminate or act in a purely arbitrary and capricious manner.

Under such circumstances, it has been declared that mandamus will lie to compel the city council, or other body, to grant that to which an applicant is entitled because the refusal of such body was arbitrary, capricious, and illegal. For cases supporting this doctrine, see Bear v. Cedar Rapids, 147 Iowa 341,126 N.W. 324, 27 L.R.A. (N.S.) 1150; 15 R.C.L. 306; 37 Corpus Juris 240; 18 R.C.L. 293; 15 R.C.L. 309; 38 Corpus Juris 743; State v. Clendenin, 92 W. Va. 618,115 S.E. 583, 29 A.L.R. 37; Jackman v. Public Service Commission, 121 Kan. 141, 245 P. 1047; Bleuel v. Oakland, 87 Cal.App. 594,262 P. 477; Larkin v. Schwab, 242 N.Y. 330,151 N.E. 637. See, also, State of Iowa ex rel. Fletcher, Attorney General, v. District Court of Jefferson County et al., 213 Iowa 822,238 N.W. 290, 80 A.L.R. 339.

On the other hand, it is urged by the appellants that the doctrine under the exception to the general rule applies only to occupations that are useful, as distinguished from occupations that are recognized as not being useful, and therefore are prohibited under the police power and merely tolerated only to a limited extent. See 37 Corpus Juris 183, section 29. Because of the facts presented in the case at bar, it is unnecessary to decide, and therefore it is not decided, whether the Marshalltown city council has an absolute right to discriminate or act arbitrarily in refusing to grant to the appellee his application for a permit to sell cigarettes. This is true because under the facts here presented the city council acted clearly within a legal discretion when refusing the permit. When the city council acted upon the appellee's application, there was evidence before it that the applicant had conducted an immoral place. He had been arrested for keeping, exhibiting, and selling obscene and lewd magazines.

Apparently the charge was not pressed, but the officers raided the appellee's place of business and there found lewd magazines, "foul trinkets", and "cow itch or itch powders".

Young people frequented the appellee's place of business. The appellee kept in the counters of his place of business iron mechanical dogs which would perform vulgar and foul tricks. According to the record, school boys purchased at the appellee's place of business itch powders which caused the boys who took physical exercise in the gymnasiums of the public schools annoyance and physical discomfort. Officers testifying for the appellants declared that they found immoral and licentious magazines in appellee's establishment. If cigarettes and cigarette papers were offered for sale by the appellee, many young people would visit his place of business to make purchases. While there, they would be surrounded by the immoral conditions above described. These facts clearly indicate that the appellants acted within a sound legal discretion when denying the appellee's application for the permit. See Harry Gundling v. City of Chicago, 177 U.S. 183, 20 S. Ct. 633, 44 L. Ed. 725.

Obviously the appellants did not act arbitrarily or capriciously in refusing to make the appellee a trustee to sell that which, without the permit, is a public offense.

Wherefore, the judgment of the district court must be, and hereby is, reversed. — Reversed.

EVANS, STEVENS, ANDERSON, DONEGAN, and MITCHELL, JJ., concur.

UTTERBACK, KINTZINGER, and ALBERT, JJ., dissent.