Since the passage of the Wilson Act of August 8, 1890, 26 Stat.
313, there is a distinction between the right to sell intoxicating
liquors on vessels engaged in interstate commerce and other
businesses conducted on such vessels.
Under the provisions of that act a state may, in the exercise of
its police powers, exact a license fee as a condition of the right
to sell intoxicating liquor over the bar on board of a steamboat
while within the boundaries of the state, notwithstanding such boat
is navigating the Mississippi River and is engaged in interstate
commerce.
Such a license fee is not a tax on the boat, crew, passengers or
liquor sold, nor a fee for navigating the river, the imposition of
which would be an interference with the commerce clause of the
Constitution, nor does it in any way violate the freedom of the
navigation of the Mississippi River as guaranteed by treaties and
statutes.
The fact that the boat is personal property owned by a
corporation of another state does not make it a part of the
territory of that state, and exempt those thereon from the police
regulations of another state in regard to the sale of intoxicating
liquor while within the boundaries of the latter state.
The plaintiff in error was compelled to pay for a license to
sell liquors while on a ferry boat at the City of Memphis, in the
State of Tennessee, the ferry boat plying between ports in the
states of Arkansas and Tennessee. The license was demanded
Page 199 U. S. 502
by the Clerk of the County Court of Shelby County, by virtue of
the following state statute:
"Liquor Dealers . . ."
"Persons selling beer or any quantities of liquor on steamboats,
flatboats, or any other vessel or watercraft, or from railroad
cars, shall pay a tax, each, in lieu of all other taxes, to be paid
in any county they may elect, per annum, $200 dollars."
He denied his liability to pay because, as he averred, he was
engaged in interstate commerce, and was not subject to be taxed by
the state in such case. The taxing officers insisting, he paid the
license for the past years 1901, 1902, 1903, and also for the then
coming year of 1904, under protest, and to avoid the taking of his
property under a distress warrant, and he then commenced these
actions to recover the money so paid. They both involve the same
question, one action being brought to recover for the back taxes
paid and the other for the taxes paid for the future, from January
1, 1904. Judgment went against him in the trial court, which was
affirmed in the supreme court of the state. 113 Tenn. 167. The
plaintiff brings the cases here by writs of error.
The record shows that Speed, the defendant in error, being Clerk
of the County Court of Shelby County, Tennessee, undertook to
assess the plaintiff in error under the Tennessee statute, and, the
plaintiff in error denying his liability to pay any tax, the
parties agreed upon the following facts for the purpose of having
the question presented judicially and determined by the court under
the practice in Tennessee:
"That the West Memphis Packet Company is, and has been for more
than fifteen years last past, a corporation duly created and
existing under and in accordance with the laws of the State of
Arkansas, located and having its situs at West Memphis, in the
County of Crittenden, in the State of Arkansas, situated just
opposite the lower end of the City of Memphis, across the
Mississippi River, having power by its charter to buy of build
Page 199 U. S. 503
and own one or more steamboats, barges, and flatboats, and other
watercraft, to be used in transporting freight and passengers on
the Mississippi River, and the lakes, bayous, and other navigable
streams connecting therewith, within the limits of the State of
Arkansas, and during the time the said James Foppiano was engaged
in selling beer and liquors, as herein stated, the said West
Memphis Packet Company was in the exercise of its corporate powers
and privileges, and engaged continuously in commerce between the
City of Memphis, in the State of Tennessee, and points contiguous
thereto situated along the Arkansas shore of the Mississippi
River."
"For more than fifteen years, the West Memphis Packet Company
has been operating a ferry across the Mississippi River from
Hopefield Point, in Crittenden County, Arkansas, and other points
adjacent thereto in the State of Arkansas, to and from the State of
Tennessee, under licenses to operate such ferry, regularly granted
and issued to it, the West Memphis Packet Company, by the County
Court of Crittenden County, Arkansas, the tribunal authorized by
the Constitution and laws of the State of Arkansas to grant and
issue such licenses, and under such licenses the West Memphis
Packet Company had been making landings regularly at its dock at
the wharf in the City of Memphis, on the Mississippi River, and
there receiving and discharging freight and passengers transported
or to be transported by means of such ferry along and across the
Mississippi River. It had made but one landing regularly in the
course of such business in the State of Tennessee, and two or more
in the State of Arkansas."
"For more than four years last past, the West Memphis Packet
Company has used and employed the steamboat
Chas. H. Organ
as its regular ferry boat in carrying on the ferry aforesaid, under
its said licenses, and such steamboat had made stated regular trips
during all that time between Memphis and the points aforesaid in
the State of Arkansas constituting such ferry landings."
"The steamboat
Chas. H. Organ was owned by the West
Page 199 U. S. 504
Memphis Packet Company, and was duly enrolled and licensed as a
steam vessel to navigate the Mississippi River and its tributaries
under the laws of the United States regulating the coasting trade,
and for other purposes, in the custom house at Memphis, Memphis
being the nearest port of the United States to the residence of the
West Memphis Packet Company, and the home port of the said
steamboat for each of the said years 1901, 1902, and 1903, and
before that time."
"Ever since the West Memphis Packet Company began the keeping
and maintaining of a ferry across the Mississippi River, as before
stated, a bar has been, and was, during the years 1901, 1902, and
1903, kept and maintained on the steamboat it used and operated for
that purpose, by some individual to whom it rented the privilege of
keeping such bar, and carrying on at the same the sale of beer and
liquors, by retail, to persons transported, or to be transported,
or upon the said steamboat."
"During the years 1901, 1902, and 1903, James Foppiano was the
lessee of the West Memphis Packet Company, and rented such bar on
the steamboat
Chas. H. Organ from it, and at such bar,
during the said time, when the boat was in transit along or across
the river, or when temporarily at the landings on the one side or
the other of the river, he made sales by retail of beer and liquors
to persons transported, or being transported, or to be transported,
upon such steamboat, or who were thereon and applied to make
purchases. And for the said years 1901, 1902, and 1903, he paid no
taxes on such business, and took out no license therefor."
"For carrying on the said business for the said years 1901,
1902, and 1903, respectively, in the manner aforesaid, the
defendant, Robert A. Speed, as clerk of the county court, insists
that the said James Foppiano was required to and should have taken
out a license for each year, and also was required to and should
have paid the tax for each year, prescribed by the law levying such
taxes, and the costs and charges therefor collected by him, as
before stated, and not having done so,
Page 199 U. S. 505
that he was authorized and required by law to make such
collections, and is not liable to repay the same."
"The said James Foppiano denies that, under the facts, he was
required by law to take out any licenses, or pay any taxes, for
carrying on the said business for the said years 1901, 1902, and
1903, respectively, or either of them, in the manner aforesaid. He
denies that the said Robert A. Speed was authorized or required by
law to collect either the taxes collected by him in the manner
aforesaid, or the costs or charges aforesaid, or any part thereof,
and claims that all such sums have been illegally exacted of and
collected from him and against his will, and that he is entitled to
recover them back. "
Page 199 U. S. 516
MR. JUSTICE PECKHAM, after making the foregoing statement,
delivered the opinion of the Court.
The plaintiff in error contends that he rented the bar privilege
from the company owning the ferry boat, and that he conducted the
business of selling liquors over the bar on the boat pursuant to
his lease, and while doing so was engaged in interstate commerce,
and therefore was not liable in any manner to be taxed on account
of conducting his business in the way he did while within the
boundaries of the State of Tennessee.
There is a distinction to be observed between the business of
the plaintiff in error in selling intoxicating liquors and any
other business which might have been conducted by him on the ferry
boat under the same circumstances. The general right of the states
to regulate or prohibit the sale of intoxicating liquors within
their borders is not denied; but how far they could prohibit the
entrance of the liquors, or their sale, after having been brought
into the state has been a subject of examination and decision
within late years by this Court.
Bowman v. Chicago &
Northwestern Railway Co., 125 U. S. 465;
Leisy v.
Hardin,
Page 199 U. S. 517
135 U. S. 100;
In re Rahrer, 140 U. S. 545;
Rhodes v. Iowa, 170 U. S. 412;
Vance v. W. A. Vandercook Company, 170 U.
S. 438. The result of the
Bowman and
Leisy cases together was to uphold the right of a party to
send intoxicating liquors into another state and sell the same in
such state in their original packages. The decisions in those cases
were followed by the passage of an act of Congress, commonly known
as the Wilson act, approved August 8, 1890, 26 Stat. 313, which
provided that intoxicating liquors, when transported into another
state or territory, should, upon arrival therein, be subject to the
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 liquors had been produced in
said state or territory. This act was held to be constitutional in
the case of
In re Rahrer, 140 U.
S. 545, and that, by virtue of said act, state statutes
might operate upon the original packages of intoxicating liquors
before sale in the state.
Rhodes v. Iowa, 170 U.
S. 412, and
Vance v. W. A. Vandercook Co., No.
1, 170 U. S. 438,
held that the state statute must permit the delivery of the liquors
to the party to whom they were consigned within the state, but
that, after such delivery, the state had power to prevent the sale
of the liquors, even in the original package.
If the liquors kept for sale at the bar on the ferry boat had
been consigned to the plaintiff in error from Arkansas, addressed
to him at Memphis, although the plaintiff in error would have had
the right to a delivery of the liquors to him at the wharf in
Memphis, yet, under the act of Congress, as construed by this
Court, the state could then at once have prohibited absolutely the
sale thereof, even in original packages. Of course, if it could
totally prohibit such sale, it would permit the sale conditionally.
In this case, there is no consignment to anyone, but we do not see
that the distinction is material. The liquors were owned by the
plaintiff in error while on the boat, and carried along from port
to port, and to be used on the boat as the demand at the bar made
necessary. The thing which
Page 199 U. S. 518
the plaintiff in error did was to sell the intoxicating liquors
on this ferry boat when temporarily at the wharf in Memphis, or
within the boundaries of the state, to persons then on the boat,
and it was on account of these sales that he was compelled to take
out a license and pay the tax therefor. Although there was no
consignment of the liquor, yet it was in the possession of the
plaintiff in error on the boat, within the state, the same as if he
had received it therein on a consignment to him from outside the
state, and had taken portions of it while in the state, sold it to
different persons then on the boat, and those persons had then and
there taken and drank the liquor, and then and thus the transaction
had been commenced and ended. The law provided no tax on any liquor
in any way, but it made it necessary for the plaintiff in error to
get a license for this sale of liquor within the state. There was
no tax levied upon the boat or crew, nor upon any of the
passengers, nor on any portion of the property of the company, nor
on the freight carried by it on the boat. Neither the boat nor its
officers nor crew were subjected to the payment of any fees for
navigating the waters of the river. The supreme court of the state
observed that the case did not show that the charter permitted the
company to maintain a bar on board its boat, nor that the liquors
sold in Tennessee came from any other state, and it may be stated
here that there was no proof that the liquors were sold in original
packages, but, as they were sold over the bar, there might perhaps
be a presumption that they were not so sold. Without deciding the
case on these grounds, the state court, interpreting the
above-mentioned act of Congress and believing that it was following
the decisions of this Court, held that, by virtue of that act, the
state had the right to exact a license as a condition precedent to
the exercise of the right on the part of the plaintiff in error to
sell intoxicating liquors over the bar on board the boat while
within the boundaries of the State of Tennessee. We think the
supreme court was right in that view of the case.
The counsel for plaintiff in error, in a most elaborate
brief,
Page 199 U. S. 519
exhibiting very great learning and industry, has sought to show
that the plaintiff in error was entitled to the free navigation of
the Mississippi River, under various treaties and compacts as well
as by the national Constitution, and to support that contention,
has gone back to a time prior to the war between Great Britain and
France, in 1756, and has cited many cases in this Court to maintain
his position. That the navigation of the Mississippi River is free
to every citizen of the United States is a fact not to be
questioned at this time. No one could successfully dispute it; but
we think that question is not involved in this case. When the ferry
boat entered the boundaries of the State of Tennessee and fastened
up at the wharf in Memphis, and the plaintiff in error then sold
liquors to customers as they asked for them, he became subject to
the police laws of that state regarding the sale of intoxicating
liquors. Enforcing that law, even if it did incidentally affect the
free navigation of the Mississippi River, is justified under the
act of Congress and the decisions of this Court interpreting the
same. As the boat is free to be navigated without molestation, let,
or hindrance on account of any fees, taxes, licenses, or otherwise,
it cannot be held that the navigation of the Mississippi River is
not free because, while within the boundaries of the State of
Tennessee and under the authority of the act of Congress, the
barkeeper on the boat is prohibited from there selling the liquors
he carries with him without first having paid the license demanded
by the state statute.
The case of
State v. Frappart, 31 La.Ann. 340, was
decided in 1879, before the act of Congress was passed, and is
therefore not applicable to the facts of this case.
The plaintiff in error also contends that, when the packet
company, being a corporation of the State of Arkansas, employed the
ferry boat in interstate commerce between the states of Arkansas
and Tennessee, the boat was a part of the Territory of Arkansas,
and the plaintiff in error, in selling liquors upon the boat, was
located outside the jurisdiction of the State of Tennessee, even
though in fact he sold the liquors while the
Page 199 U. S. 520
boat was tied to the wharf in the City of Memphis. Many cases
are cited in counsel's brief where tangible property was directly
taxed by the state and where it was held that the state had no
jurisdiction because, although the property was temporarily within
the state, it was not there permanently.
Hays v.
Pacific Mail Steamship Co., 17 How. 596,
Morgan v.
Parham, 16 Wall. 471, were cases of vessels not
abiding within the state where they were taxed, and were there but
temporarily while engaged in lawful trade and commerce, with their
situs at the home port, where the vessels belonged, and where the
owners were liable to be taxed for the capital invested, and where
the taxes had been paid.
See also Old Dominion Steamship Co. v.
Virginia, 198 U. S. 299.
Here, however, there is no taxation of any property whatever,
either of the boat or the plaintiff in error. He is simply called
upon to pay a tax for the privilege of doing the business in which
he was engaged -- that is, the retailing of intoxicating liquors at
the bar of the ferry boat -- while that boat was within the
jurisdiction of the State of Tennessee. The fact that he was so
engaged within the actual territory of that state cannot be blotted
out in such a case as this by any fiction suggested by the counsel
for plaintiff in error. As we have said, we see no objection to
this exercise of the power of the state, regard being had to the
act of Congress already mentioned.
The judgments of the Supreme Court of Tennessee are
Affirmed.
