177 Ky. 216
Court of Appeals of Kentucky.
Oct. 16, 1917.
ACTION: Reversed and remanded.

Appeal from Circuit Court, Knox County.
Edd R. Eales was convicted of violation of an ordinance of the City of Barbourville, and he appeals.

Edd R. Eales was fined for violation of the license ordinance of the city of Barbourville, and prosecutes this appeal for the purpose of testing the validity of the ordinance.

Section 1 of the ordinance in question makes it unlawful for any person, firm, or corporation to engage in posting, distributing, or tacking bills, placards, or other printed matter or samples of any merchandise without the payment of a license fee of $1 for each day so engaged, and fixes the penalty at not less than $2, nor more than $10, for each offense. Section 2 provides that the ordinance "shall not apply to resident merchants, county fair associations, owners, lessees, managers of moving picture theaters, or candidates for political office, in advertising their respective businesses, nor shall it apply to licensed bill posters for the posting of bills, etc., upon their own billboards."

According to the agreed facts, appellant was a resident and citizen of the state of Illinois, and at the time of his arrest was engaged in distributing to the residents of Barbourville free sample packages of "Arm and Hammer Soda" and printed matter referring thereto, which had been sent to him by his employer, Church & Dwight, a corporation organized under the laws of the state of Maine, with its principal place of business in the city of New York, from which place said packages of soda and printed matter were shipped to appellant at Barbourville, to be distributed by him under his employment for the purpose of furthering said corporation's business of manufacturing, shipping, and selling soda in the city of Barbourville.

We find no merit in the contention that the license fee in question is an unjust burden on interstate commerce. Appellant was not engaged in selling merchandise by sample and transmitting orders therefor to be filled by his employer. The interstate movement of the merchandise and printed matter ended upon their delivery to the appellant, and the mere fact that such articles were sent to him for the purpose of distribution, and that their distribution might ultimately result in interstate business, is altogether too remote to sustain the position that he was then engaged in interstate commerce.

But the contention that the ordinance is discriminatory presents a more serious question. While our Constitution permits the classification of occupations and trades for the purpose of license taxation, it is well settled that there must be same reasonable basis for the classification, and classification based on mere difference in citizenship cannot be sustained. Hence a statute or ordinance which, in imposing license taxes, discriminates in favor of residents of the city or state, as against nonresidents of the same class, is unconstitutional. Applying this rule to the facts in this case, we find that, although section 1 of the ordinance in question makes it unlawful for any person, firm, or corporation to engage in posting, etc., yet section 2 of the ordinance specifically exempts resident merchants and others from its operation. The necessary effect of the ordinance, therefore, is to permit resident merchants to advertise their wares in the manner pointed out by the ordinance, while persons engaged in the same business, but living outside the city, are required to pay a license fee for no other reason than that they are nonresidents of the city. In our opinion, the attempted classification is arbitrary, and the ordinance is void, because it discriminates against nonresidents.

Judgment reversed, and cause remanded for proceedings consistent with this opinion.

Ky.App. 1917.
197 S.W. 634, 177 Ky. 216


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