Revne v. Trade Commission

Andrew Revne and the interpleaded plaintiffs are barbers maintaining single chair barber shops on the outskirts of the business districts of their respective communities where many of their clientele sought their services after working hours; and where presumably their expenses of maintaining their little shops were not as much as the shop located in the center of the business district. Pursuant to our "Barbers Price and Hour Act," Chapter 16, Laws of Utah 1945, defendant "Utah State Barber Board" promulgated the following restrictions upon prices and hours of work for barber shops: "Price Schedule" "Hair cut ....................................... $0.65 Shave .......................................... .40 Hair cut (children under 14 years) ............. .50 Neck clip only (ladies only) ................... .25 Singe .......................................... .65 Shampoo-plain .................................. .65 Shampoo-Oil or Mange ........................... 1.00 Shampoo-Fitch dandruff remover ................. .75 Massage-Plain (head, face neck) .............. .65 Face steam ..................................... .50 Tonic .......................................... .25 Razor honed .................................... .65 "No service less than .25 *Page 157 "Barber shops shall not be open for business nor shall any barber, barber apprentice or student be permitted to operate as a barber before the hour of 8 o'clock a.m. nor after 6 o'clock p.m. on Monday, Tuesday, Wednesday, Thursday, Friday and Saturday, except that shops may remain open on Saturday and days before holidays until 7 o'clock p.m., except further, that customers in shops at the specified closing time may be serviced." Plaintiffs instituted this action before the lower court, under the provisions of our Declaratory Judgment Act, to have this barbers law declared unconstitutional and void. The lower court found in plaintiff's favor, and the defendants appealed. Under Section 5 of the barbers act, the defendant, Trade Commission of Utah, is the enforcement agent. The following extracts from the act are pertinent to this discussion: "Section 1. * * * "(2) `Organized and representative group' means any organizatzion composed of duly licensed barbers collectively acting for the purpose of negotiating and fixing a scale of minimum price agreements and opening and closing days and hours representing 70 per cent or more of the licensed barbers within any city or county of the state of Utah. "Section 2. Scale of Minimum Prices — How Fixed — Increase. "Whenever a scale of minimum prices have been agreed upon, signed and submitted to the board by an organized and representative group, the board shall have power to approve such agreement and shall declare and establish within such city or county by official order the minimum prices for any and all work or barbering services usually performed in barber shops. The board shall have power to and shall make and establish a differential minimum price schedule in favor of barber colleges operating in accordance with law of not more than 70 per cent of the minimum prices to the public for similar services in barber shops. Before approving such agreements the board within thirty days after such schedule is submitted shall determine by investigation whether such suggested and proposed scale of minimum prices is reasonable and sufficient to enable barber shops in such district to operate in keeping with the purposes of this act in minimizing and relieving danger to the public health and safety. "Any person desiring to intervene in such determination shall file a verified application in writing within ten days after such schedule of proposed minimum prices is submitted to the board setting out *Page 158 fully the grounds upon which such person claims to be interested. Upon filing such application the board shall cause to be held a public hearing at which the applicant shall be entitled to be present or represented in the manner it shall deem fit and proper for the purpose of investigating and hearing such grounds. "In determining reasonable minimum prices the board shall take into consideration the necessary costs incurred in the particular city and county in maintaining barber shops in a clean, healthful, and sanitary condition and also the wages and commissions which are customarily paid to employees in such barber shops and shall take into consideration any other facts and conditions affecting the barber profession in its relation to the public safety and health. If the board shall find after investigation or a public hearing that the minimum prices fixed in such districts are insufficient to provide adequate service for protecting the public health and safety such minimum prices may be increased from time to time. "Section 3. Power to Fix Hours of Service. "The board shall have power to approve and by official order to establish days and hours when barber shops may remain open for business whenever agreements fixing such opening and closing days and hours have been signed and submitted to the board by any organized and representative group and the board shall have like power to conduct public hearings and to investigate the reasonableness and propriety of the hours fixed by such agreement as is conferred under section 2 of this act. "Section 4. Board Orders Filed with Trade Commission — In Force One Year. "All orders of the board approving schedules of prices to be charged for barber services and agreements fixing opening and closing hours and days for barber shops as herein provided shall be filed with the trade commission and shall remain in force and effect for a period of one year after the date of approval of such order and shall be renewed annually upon its anniversary date unless rescinded, modified, or replaced by a new agreement approved and promulgated by the board after being signed and submitted under the procedure provided in sections 2 and 3 of this act. * * * * * "Section 8. General Powers of Trade Commission — Physical Examination of Barbers. "The trade commission is hereby vested with such general powers as are necessary for administering and enforcing this act and shall require and enforce an annual physical examination of every licensed barber in Utah to be made by a legally qualified medical physician, * * *." See also, Chapt. 29, Laws of Utah 1945. *Page 159 Sections 9 and 10 provide penalties for violations of the act which include misdemeanor charges, and a deprivation of license to practice. Section 12 of the Act provides that a declaration of invalidity of any part of the act shall not affect other parts. Section 13 provides the annual license and license fee required, and provides that it shall be required in city or county districts in which minimum price agreements or opening and closing day and hours agreements are operative under the act, and shall expire with any such agreement. The lower court, after finding that the act was being enforced against Andrew Revne by a cease and desist order, included these as findings of fact and as conclusions of law: (From the findings of fact.) "6. That the statutes hereinbefore mentioned, as interpreted and as so applied as aforesaid, and enforced by said defendants or attempted to be enforced, are invalid and unconstitutional and violate the provisions of Article I, Sections 1, 2, 7, 11, 24, 25, 26, 27, Article V, Section 1, and Article VI, Section 1 and 26, subsection 16 therof, and Article XII, Section 20 of the Constitution of the State of Utah, and the provisions of the Constitution of the United States of America known as Amendments V and XIV. "7. That the provisions of said statute designated as the `Barbers Price and Hour Act' requiring barber shops to close at 6 o'clock p.m. on secular days, and requiring barbers to charge the minimum price for barber service, as hereinbefore set forth, is not valid or proper exercise, and is an unlawful extension of the police powers of this State in the regulation of the barbering profession, and said regulations bear no reasonable relation to the public health and general welfare and such statutes and regulations promulgated therein are therefore invalid." (From the conclusions of law.) "1. That the provisions of Chapter 16, Session Laws of Utah 1945, and particularly Sections 2, 3, 4, 5, 6, 7, 10, 11, 13, and 14 thereof, said Act also being designated as the Barbers Price and Hour Act, are invalid and unconstitutional and violate the provisions of Article I, Sections 1, 2, 7, 11, 24, 25, 26, and 27, Article V, Section 1, Article VI, Sections 1 and 26, subsection 16 thereof, and Article XII, Section 20 of the Constitution of the State of Utah, and the provisions of the Constitution of the United States of America known as Amendments V *Page 160 and XIV. That the plaintiffs are entitled to an order restraining the defendant Trade Commission of Utah from enforcing the provisions of said statute." Included within the grounds adopted by the lower court as the basis for its adjudication of unconstitutionality, is that of an unlawful delegation of legislative authority. If that is a correct view of the act there is little or no need for further discussion of the matter. Counsel for the litigants have cited the authorities pro and con upon that issue, some of each of which we shall consider, to arrive at our views of the matter. In support of the constitutionality of such an act, the defense cites, among others, the following cases: Herrin v.Arnold, 183 Okla. 392, 82 P.2d 977, 119 A.L.R. 1471; andArnold v. Board of Barber Examiners, 45 N.M. 57,109 P.2d 779. On the other hand plaintiffs rely upon such cases as LaForge v. Ellis et al., 175 Or. 545, 154 P.2d 844; andHollingsworth v. State Board of Examiners, 217 Ind. 373,28 N.E.2d 64, for their belief in the unconstitutionality of the act viewed in the light of a delegation of legislative power. We have selected the above cases for discussion as the questions therein involved were almost identical with those of the present case. The distinction between the two groups, we believe, lies in the difference in wording of the act involved in each case. It is that distinction which accounts for the opposite results reached. The Herrin case: We quote paragraphs (b) and (c) of the Oklahoma Statute pertaining to the barber's price act of that state, Sec. 12, 59 Okla. St. Ann. § 102: "(b) The Board, after making such investigation, shall fix, by official order, the minimum price for all work usually performed in a barber shop. "(c) That if the Board, after investigation made either uponits own initiative or upon the complaint of a representativegroup of barbers, determines that the minimum prices so fixed are insufficient to properly provide healthful services to the public and keep the shops sanitary, then the Board from time to time shall have authority to vary *Page 161 or refix the minimum prices for a barber's work in each city or town affected by this act." (Italics ours.) Particular attention is invited to the italicized words "fix," "to vary or refix," and "either upon its own initiative or upon the complaint of a representative group of barbers," as these expressions are the foundation for the court's opinion that the act is not unconstitutional. In effect the decision holds that the filing of a price agreement of the 75% of the barbers is merely a convenient way of initiating the board's power to act, but that the board may act upon its own initiative, and may fix such prices as it deems reasonable under the circumstances. In other words the board's power is not merely one of approval or disapproval. It has the duty and responsibility of ascertaining the facts itself. The Arnold case: The New Mexico law is like the Oklahoma law. The board is not limited to action upon petition of 75% of the barbers. It may act upon its own initiative. Paragraph (b) of both laws is the same. Here too the question of an unlawful delegation of legislative power is discussed, the court citing and approving the Herrin case of Oklahoma and similar cases. Before discussing plaintiff's cases let us consider the wording of the Utah Act. Throughout the sections (quoted) it is to be noted that the board's powers are limited to approval of agreements, and, inferentially at least, disapproval. We have no provision authorizing the board to fix prices, nor hours, upon its own initiative and no provision authorizing it to "vary or refix" prices or hours after investigation. It is limited to increasing the prices if the then existing prices are insufficient for the purposes of the act. It is noted that (section 4 quoted) the schedules of prices and hours that become final, and active from year to year are those included in the board's "order" of "approval" of "agreements," and they remain the law until rescinded, modified, or replaced by a "new agreement approved and promulgated" by the board. The board's hands are effectually bound to agreements initiated by the 70% of the barbers of the territorial unit involved. *Page 162 Now as to plaintiff's citations: The La Forge case [175 Or. 545, 154 P.2d 847]: The Oregon statute is like this Utah statute, so far as the powers of the board are concerned and this is what the court has to say: "It is urged, however, that the act should, if reasonably possible, be given a construction which would render it constitutional rather than unconstitutional, and that, under a reasonable construction, it means that the board is granted authority to fix schedules of minimum prices on its own initiative and without regard to schedules contained in agreements made by seventy per cent of the barbers of a county. Were this an admissible construction a different question would be presented, but, in our opinion to give the statute the suggested meaning would not be to construe it, but to rewrite it. For it is only after a `scale of minimum prices' has been `agreed upon, signed and submitted to the board of barber examiners' by seventy per cent of the licensed barbers in the county that the board is authorized to act at all. The board may then, after investigation and consideration, `approve such agreements' and `declare and establish * * * the minimum prices.' But if it should fail to approve an agreement it is not granted authority to establish a different scale of prices which it might find to be `reasonable and sufficient.' There its authority ceases, and, unless and until seventy per cent of the licensed barbers of the county submit another agreement containing a scale of minimum prices which the board finds to be `reasonable and sufficient,' the price of barbers' services remains unregulated and every barber is free to charge the price he chooses whether it be `reasonable and sufficient' or otherwise. "The correctness of this construction becomes the more evident from an examination of § 4, which provides that all orders of the board approving price schedules shall remain in effect for a period of one year after the date of the approval of any such order, `and shall be renewed annually upon its anniversary date unless rescinded, modified or replaced by a new agreement,approved and promulgated by the board, after being signed andsubmitted under the procedure provided in section 3 of thisact.' (Italics added.) Thus, it is seventy per cent of the licensed barbers of the county, not the board, which determines whether or not a price schedule shall continue effective for more than one year, and, even though a price schedule in effect had, due to a change in conditions, become unreasonable and insufficient, and the board should so find, it would be powerless to terminate, suspend or modify the schedule, and seventy per cent of the registered barbers in the county could keep those prices in effect by simply refraining from doing anything. * * * * * *Page 163 "The attempted delegation of authority here differs from that in the statute of Oklahoma sustained in Herrin v. Arnold, supra, and in the statute of New Mexico sustained in Arnold v.Board of Barber Examiners, supra. In the former case (183 Okla. 392, 82 P.2d 983 [119 A.L.R. 1471]) the court said that `the board may act with or without the submission of an agreement' and in the latter (45 N.M. 57, 109 P.2d 787), that the board was granted `authority "to vary or refix" from time to time the minimum price.' Under the Oregon act, the board must either take what is offered by `a preponderant majority of a group' or do nothing." The Hollingsworth case: The Indiana law gives the board approval power, too, but it has some added features among which is that specifically providing for disapproval if the prices are insufficient, or excessive. However, it has no authority to establish prices founded upon its own initiative. The activating percentage of barbers in this state is 80%. Upon a basis of reasoning similar to that of the Oregon Supreme Court, the Supreme Court of Indiana declared sections 3 and 4 of the act unconstitutional as an unlawful delegation of legislative authority. Sections 3 and 4 of that act are the equivalent of sections 2 and 3, quoted of our act. We recognize, of course, that the legislature may properly delegate to some administrative body the duty of ascertaining the facts upon which the provisions of a law are to function, and also, that one of the methods of initiating activity on the part of that administrative body may be by petition 1, 2 of the citizens concerned. Such procedure is not in and of itself defective as an improper delegation of legislative authority. The question of an improper delegation of legislative authority lies embedded in the extent of the power granted to the administrative body. If the interests of the public must give way to those of a particular class, the effect is simply to permit that class to impose its will upon the administrative body and the public, be the results beneficial to the public or not. This law was enacted as a health and safety measure in the interest of the public, and that interest should govern its functioning. However, in the procedure provided for its activation the public interest is given second place to the *Page 164 interests of a 70% majority of the profession directly affected by the law. If we could properly presume that such 70% would only act in the public interest and would act when that interest necessitated action there might be argument for upholding the law. No doubt it can be said that no harm to the public can occur, as the board stands between the 70% and that public, but, the law was not passed to grant a class certain benefits so long as the public was not injured. The law was passed to protect the public health and safety by authorizing the establishment of certain prices and hours in the public interest, and yet there is no way, on behalf of the public, to initiate such security if the specified majority of the barbers refuse, for selfish reasons, to act. No other group of citizens may initiate the schedules. The board is not given power to act for the public upon its own initiative. Thus the public interest is subjected to the interests of a group who may be very antagonistic to that public interest. They cannot do the public interest any harm by action — presumably the board would stop that — but they do not have to give it any aid, either, as they may remain inactive. Thus the law creates a static situation which defeats its own purpose. Price schedules and opening and closing hours become the law when properly promulgated under the provisions of the Act. One step in that promulgation is the agreement of 70% of the barbers. If, then, the question as to whether or not a given locality shall have such law promulgated or, modified, or rescinded if already in existence, is left to the whim of this group, it is hard to escape the conclusion that legislative authority has been improperly delegated or surrendered to that class. This is not a case where the law is in existence and is submitted to the local voters, a political group, as to whether or not it shall be accepted in that locality. Under such circumstances, if they were the facts, the local vote could well be accepted as in local public interest, but not so the vote of the 70% of the barbers of that locality, an economic group, as an initiatory step to the creation of such a protective local law. We believe this act is not properly confined to the public *Page 165 interest. Prices and hours established at a time justifying them may subsequently become a yoke around the neck of the public if the majority of a class choose to refrain from action. Sections 2, 3 and 4, of the act are unconstitutional as an improper delegation of legislative authority. 3 The judgment of the lower court is affirmed for the reasons given. WADE, J., concurs.