People ex rel. Loughran v. Flynn

Clarke, J. (dissenting):

I dissent.' It is and always has been the law of this State that the regulation of the traffic in liquors is part of the police power. In the exercise of that power the Legislature has provided that a license procured by false statements as to certain easily ascertainable physical facts shall be invoked by one State . officer on an official report made after inspection by another public officer of the nonexistence of those physical requirements in the building in which the liquor is to be. sold. To hold that a license to sell liquor obtained by such a fraud so established may not be so revoked upon the ground that thereby a constitutional right is violated, does not seem to me to accord with the matured views of the courts of this State. There are expressions in some opinions which may be cited in support thereof. It seems to me they have been withdrawn or overruled. In People ex rel. Ochs v. Hilliard (81 App. Div. 71 ; affd., 178 N. Y. 582) no proceedings of any kind had been taken against the certificate holders either criminally or civilly, nor had their license been taken away. The building for which it had been issued had burned down and the assignees of the certificate who had advanced the money to pay the tax attempted to obtain the rebate from, the State. dSTotwithstanding the fact that these innocent third parties who had advanced their money on the strength of the provisions of law in regard to rebates were ignorant of the false statements in the application upon which the certificate was granted the court said: “Any false statements in the application in that regard vitiated the certificate in their hands and in the hands of their assignee as well. * * * Inasmuch as they were not-eligible to traffic in the liquor business, the certificate'issued to them on their false representation was void,” and their proceeding was dismissed. In Lyman v. Schermerhorn (167 N. Y. 115) it was said : “ The false ■statement upon which he procured it overreached the certificate ■ itself, and at the election of the State rendered it void ah initio. * * * When the State withdraws that approval and asserts that the certificate affords no protection to its holder, the bond which was given in consideration of such protection ceases to be supported by it.” Chapter 697 of the Laws of 1905, here in consideration is a method provided by which the State ex rcises its election to declare the certificate obtained by fraud to be void ah initio. It *294seems to me to be well within the police power and so far as .it provides for the revocation of the certificate valid.

By. chapter 578 of the Laws of 1866 licenses to sell liquor taken out under the 'provisions of the Excise Law of 1857 (Laws of 1857} chap. 628) were revoked. 'The Court of Appeals, in Metropolitan Board of Excise v. Barrie (34 N. Y. 657), said: “It, in terms, it is true, revokes licenses granted under the act of'1857} but that is no encroachment upon any right secured to the citizen as ■' inviolable by the fundamental law. * v* *” The licenses “ form ,a portion of the internal police System of the Stateare issued, in the exercise of its police powers, and- are subject to the direction of the State government, which 'may modify, revoke or continue them; as it may deem fit,” and held the act constitutional. The present Liquor Tax Law expressly terminated all outstanding licenses. In People ex rel. Einsfeld v. Murray (149 N. Y. 367) the Court of Appeals held this to be constitutional as a law enacted under the police' power.

In my opinion the order should' be affirmed.

Laughlin, J., concurred.

Order reversed and. relator discharged.