The validity of schedule 51, § 361, Gen. Acts 1919, pp. 282, 395, 411, having been ascertained and determined by the Supreme Court, the only question for decision now is whether or not appellee, in this case, comes within the terms of the statute, supra, under the agreed statement of facts upon which the case was tried in the court below. The trial judge, the Honorable Walter B. Jones, of the circuit court of Montgomery county, held that he did not, and in this I think the trial judge was correct, as it is my opinion, under said agreed statement of facts, it clearly appears *Page 449 that the defendant, appellee here, was not engaged in the business of conducting bankrupt sales, advertised as such, as contemplated by said statute and therefore was not subject to the payment of this particular license for which this suit was brought. It would, in my opinion, require a constrained construction to hold otherwise.
The statute in question is penal in nature and must, therefore, under the law, receive a strict construction against the state, and construed liberally as to the tax payer.
I am of the opinion that the principles of law announced in the case of Jones v. State, 25 Ala. App. 410, 149 So. 855, certiorari denied 227 Ala. 400, 149 So. 857, are applicable to the case at bar.
The facts show that the appellee was a resident of the city of Montgomery and engaged in the retail mercantile business in the city of Montgomery, Ala.; that he had been engaged in the retail business in Bessemer, Ala., since the year 1919; that he entered into a lease for the premises formerly occupied by the Montgomery Cash Store, and after the lease was entered into and negotiated, he bought from one J. H. McCormick the stock of merchandise and fixtures formerly belonging to the Montgomery Cash Store and which had been previously sold to McCormick under order of the United States District Court, in bankruptcy, at Montgomery, Ala.; that the appellee has continuously been engaged in the retail business at such storehouse in Montgomery, Ala., from March 9, 1932 and still continues to operate a retail merchandise store at said premises. Further, that as an incident to his said business at No. 24 Court street, he advertised in the mode and manner set forth in the agreed statement of facts. (Exhibit A). From these facts, it can readily be seen that appellee was not in any way engaged in the business of selling goods, etc., such sales being advertised as bankrupt, insolvent, insurance, assignee, trustee, etc., but was engaged in the retail business and wished to dispose of a stock of merchandise that had been bought from McCormick, and by McCormick through the bankrupt court. He had every right to advertise this merchandise so that it might be disposed of readily and promptly and make room for additional and new merchandise which was to go into the business. He, at the time, had a legitimate right to advertise and sell the old fixtures which he had bought, in order that new fixtures or such fixtures as he might desire, could be placed in the premises.
A state and county license for doing a mercantile business was not required. Appellee did procure a license from the city of Montgomery for the year 1932 to do a retail business; he entered into a lease from March 9, 1932, to September 30, 1933, showing that he was not an itinerant to transient; that he was and intended to be a legitimate retail merchant in the city of Montgomery, and in further corroboration it is shown by the statement of facts that he was continuously in business from then and until now in the regular retail merchandise business. On March 31st, several weeks after the execution of the lease and after his city license had been paid, the advertisement attached to the agreed statement of facts was inserted in the newspapers.
The principle laid down in Karthaus v. State, 19 Ala. App. 136,95 So. 563, are applicable here. In that case the court said: "Under the principles announced in the Braxton Case, supra [16 Ala. App. 476, 79 So. 150] it clearly appears that the appellant did not engage in or carry on the business of auction sales as contemplated by law, and it affirmatively appears that 'selling at auction' was not his business. The one isolated act referred to in the agreed statement of facts was a mere incident in the conduct of his business as a retail jewelry dealer, and, as stated therein, as executor of the estates of his deceased partners." See, also, Carruth v. State, 24 Ala. App. 158, 132 So. 65.
I am also of the opinion that the advertisement complained of does not come within the terms of the statute, supra. This appears to be conceded by the appellant; but it is insisted that it is within the spirit of the legislative intent. As stated, this is a penal statute, therefore the intent of the Legislature must be found in the words and phrases used in the statute. The advertisement itself merely informs the public the source from where the goods were acquired, and in no manner advertises that said goods or merchandise would be offered or sold at bankrupt sale. The mere fact that the advertisement contains the source from which the merchandise was obtained does not bring it within the terms of the statute. As aptly insisted by appellee, "Suppose, for example, the stock advertised had been sold under attachment by the landlord for rent, and the defendant's advertisement *Page 450 had read, 'Bought at Foreclosure Sale Entire Stock Montgomery Cash Store' etc., — could it be contended that this was within the terms of the Statute? No more so, setting forth of the truth that the stock was a former bankrupt stock of the Montgomery Cash Store."
This case was properly tried and determined in the court below and the judgment should be affirmed.
I do not concur in the conclusion reached and announced in the majority opinion, nor in any of the reasons upon which such conclusion is based, therefore my dissent.