Lindberg v. Benson

70 N.W.2d 42, 1955 N.D. LEXIS 107

• Court: North Dakota Supreme Court
• Decided: April 18, 1955
• Docket: 7492
• Status: Published

Opinions

BURKE, Chief Justice.

At the June primary election in 1954, the people of this State, by means of the initiative, enacted a statute limiting the right of members of the Legislative Assembly to contract with the State and its subdivisions. It was entitled an “Anti-Corruption” measure. This statute provides :

“No member of the Legislative Assembly of the State of North Dakota, his spouse, nor a partnership, corporation or association, in which such member or spouse, has’an ownership of five percent or more of ,the assets, shall perform any work, labor or services, .or provide any material, supplies or merchandise, for the State of North Dakota, or any of its subdivisions for a consideration in excess of a total of ten thousand ($10,000.00) dollars during any calendar year for such work, labor, services, material, supplies and merchandise.

“Any person violating the provisions of this act shall be deemed guilty of a misdemeanor and shall forfeit any consideration received during, or as a result of, or in connection with the violation of this act.”

Plaintiff on behalf of himself and others similarly .situated, has challenged the constitutionality of this statute by this action for a declaratory judgment. In his complaint he alleged that he is engaged in business as a general contractor; that as such, he is engaged in performing work for •and furnishing materials to the State of North Dakota and many of its political subdivisions; that he expects to continue to perform work for and furnish materials to the State and its subdivisions; that he is a member of the Legislative Assembly of the State of North .Dakota; that as a result of the enactment of the “Anti-Corruption Measure” a justiciable controversy has arisen between him and the defendants concerning his right to compensation for work done and materials furnished and his right to continue to perform work for and furnish materials to the State and its subdivisions. He alleged that the “Anti-Corruption Measure” is violative of both the State and Federal Constitutions and asked for a judgment resolving the controversy between the parties by declaring that the measure is. unconstitutional and by a construction of the measure which would clarify the position of the parties.

The defendants answered, admitting that a controversy exists between the parties, both as to the construction to be given to 'the initiated measure and as to its constitutionality and that a declaratory judgment would clarify the rights and status of the parties. They alleged that the measure was in all respects constitutional and asked for judgment to that, effect. After a trial of the .action in the District Court of Bur-leigh County, judgment was entered, declaring the measure constitutional. Plaintiff has appealed from the judgment and demanded a trial de novo in this court.

. The controversy which exists between the parties is threefold; first, whether plaintiff is entitled to compensation for work performed for, and materials furnished to, the State of North Dakota after the effective date of said measure under a contract entered into between the Highway Commissioner and the plaintiff prior to such date; second, whether the ten thousand dollar limit of the value of services and materials, which may be furnished by a member of the Legislative Assembly to the ■State of North Dakota or its political subdivisions, is the aggregate limit which may be furnished to any one political entity or the aggregate limit which may be furnished to all such entities; and third, whether plaintiff, as a member of the Legislative Assembly may continue to furnish materials arid sérvices of a value in excess of ten thousand dollars a year to the State of ¡North Dakota- and receive compensation therefor.

The first two points in controversy are resolved by a construction of the measure. With respect to the first point, it is clear that the measure must be construed to be prospective in operation and that it cannot apply to services and materials furnished in compliance with a contract entered into before its effective date. It- is only where the legislative intent is -clearly expressed that a statute will be construed to operate retrospectively. Gimble v. Montana-Dakota Utilities Co., 77 N.D. 581, 44 N.W.2d 198; Great Northern Ry. Co. v. Severson, 78 N.D. 610, 50 N.W.2d 889. Furthermore, to give this statute other than prospective ■effect would give rise to a very serious doubt as to whether it would violate both State and Federal Constitutions by impairing the obligations of contracts. A construction which will render a statute of doubtful constitutionality will be avoided where reasonably possible. Lapland v. Stearns, N.D., 54 N.W.2d 748; State ex rel. Graham v. Hall, 73 N.D. 428, 15 N.W.2d 736.

As to the second point in controversy, we think the language of the statute is so clear that it leaves no room whatever for any doubt as to its proper construction. This language is:

“No member of the Legislative Assembly * * * shall perform any work * * * or provide any material * * * for the State of North Dakota or any of its subdivisions for a consideration in excess of a total of ten ($10,000.00) dollars during any calendar year.”

In the phrase “for the State of North Dakota or any of its subdivisions” the alternative “or” and the indefinite “any” are both used. “Any” means “one indifferently out of a number”,'Webster’s International Dictionary, 2nd ed. The language has exactly the same meaning as if the phrase had read “for the State of North Dakota or any one of it's subdivisions.” We are clear therefore that the ten thousand dollar limit is the aggregate limit of value of service and materials which may be furnished to any one political entity and not the aggregate limit of value which may be furnished to all such entities.

The third point in controversy requires a consideration of the constitutionality of the initiated measure. Plaintiff alleged and argued that the classifications created by the, initiated measure , deprived him and others similarly situated of their property without due process of law and deny them equal protection of the laws in violation of Article 14 of the Amendments to the Constitution of the United States and Sections 11-and 13 of the Constitution of North'Dakota and. that the initiated measure violates Sections 28 and 34 of the .Constitution of. North Dakota by providing for qualifications, in addition to those fixed by the Constitution, for membership in the Legislative Assembly.

The first attack upon the classification is that the naming of members of the Legislative Assembly as a class with which the State and its subdivisions will not do. business except in limited amounts is arbitrary and has no reasonable relationship to the purposes for which the initiated measure was enacted. In considering' this and the other challenges to the constitutionality of the measure every .reasonable presumption in favor of its constitutionality prevails. Anderson v. Peterson, 78 N.D. 949, 54 N.W.2d 542; State ex rel. City of Minot v. Gronna, N.D., 59 N.W.2d 514. The measure was denominated an “anti-corruption” measure. The purpose of the enactment was to extend the ancient common-law rule that no state officer may be interested in any contract which he has a voice in letting (which rule is expressed in many statutes of this state) by providing a more comprehensive legislative rule, founded in public policy, which would take away from legislators as a class any personal incentive to increase their opportunities to make profitable contracts by their votes in the legislature or to use their influence as legislators in securing contracts or the approval of the work done under them. The members of the ■ Legislative Assembly exercise a high degree of control oyer the fiscal affairs of the State and its subdivisions. They regulate assessments and tax levy limits. They authorize bond issues and, for the State, they make all appropriations. By enacting this initiated measure the people have attempted tb remove from the legislators temptation to venality in the exercise'of their legislative functions. Many states have constitutional or legislative provisions which are similar in nature and which have remained in force unchallenged for many years. Section 11, Chapter 121, Revised Statutes of Maine, 1903; Article V, Section 30, Constitution of Montana; Article 3, Section 12, Constitution of South Dakota; Section 365, Revised Statutes of Idaho, 1887; Article 3, Section 16, Constitution of Nebraska; Article IV, Section 15, Constitution of Illinois; Ill.Rev.Statutes 1951, Chapter 127, par. 75. There is thus nothing novel either in a public opinion that the faithful discharge of a legislator’s duties may be hindered by a temptation of personal profit, or in the means taken to eliminate at least a part of the temptation. In fact there appears to be a substantial consensus that such legislation is in the interest of the public welfare. Whether such .legislation is wise or expedient or whether it will fully accomplish its avowed- purpose are not questions for the courts to consider. State ex rel. Linde v. Taylor, 33 N.D. 76, 156 N.W. 561, L.R.A.1918B, 156, Ann.Cas. 1918A, 583. .

We are satisfied that the enactment of the initiated measure under consideration was not in excess of the legislative power. No individual has a legal right to be selected as a contractor for the' state and if a statute barring a class of individuals from an opportunity to contract with the state- bears some relation to the public welfare, it does not violate the due process, or equal opportunity clauses of the 14th Amendment to the Constitution of the United States nor like provisions of the Constitution of this State. In Perkins v. Lukens Steel Co., 310 U.S. 113, 127, 60 S.Ct. 869, 876, 84 L.Ed. 1108, 1114, the Supreme Court said:

“Like private individuals and businesses, tlie Government enjoys the unrestricted power to produce its own supplies, to determine those with whom it will deal, and to fix the terms and conditions upon which it will make' needed purchases.”

In Atkin v. Kansas, 191 U.S. 207, 24 S.Ct. 124, 128, 48 L.Ed. 148, 158, the Supreme Court said:

“ * * * no employee is entitled, of absolute right and as a part of his liberty, to perform labor for the state; * *

In Tribune Printing & Binding Co. v. Barnes, 7 N.D. 591, 597, 75. N.W. 904, 906, this court said:

“Viewed as a question of principle, we are unable to see why the state is forbidden to do what an individual certainly may do with impunity, viz. elect from whom it will purchase supplies needed in the discharge of its corporate functions.”

See also, Ellis v. United States, 206 U.S. 246, 27 S.Ct. 600, 51 L.Ed. 1047; Heim v. McCall, 239 U.S. 175, 36 S.Ct. 78, 60 L.Ed. 206; People v. Crane, 214 N.Y. 154, 108 N.E. 427, L.R.A.1916D, 550, affirmed Crane v. People of State of New York, 239 U.S. 195, 36 S.Ct. 85, 60 L.Ed. 218; In re Opinion of the Justices, 303 Mass, 631, 22 N.E.2d 49, 123 A.L.R. 199; Shaw v. City Council of Marshalltown, 131 Iowa 128, 104 N.W. 1121, 10 L.R.A.,N.S., 825; City and County of Denver v. Bossie, 83 Colo. 329, 266 P. 214.

The classification contained in the initiated measure is also attacked because, it is said, it does not operate equally with respect to all within the- named class. This attack is based upon, the provision'of the measure which permits legislators to furnish services and supplies of a value of less than $10,000 in any calendar year.. The argument is that this provision discriminates against legislator contractors who specialize in construction work which usually or almost always exceeds the $10,000 limit of value. The plaintiff whose specialty is highway work is such a contractor. It is true that “ * * * A proper classification for legislative purposes must embrace all who naturally belong to the class * * Fountain Park Co. v. Hensler, 199 Ind. 95, 155 N.E. 465, 50 A.L.R. 1518, and “Legislation cannot arbitrarily divide a class into, two parts and constitute a different rule of law governing each of the parts”, State v. Cullum, 110 Conn. 291, 147 A. 804, 806, but the legislation under consideration does not violate these principles. The class named is a single undivided class. It consists of all members of the Legislature. There is a single rule of law governing the entire class. No member of the class may contract with the state or any of its subdivisions in a sum in excess of $10,000 a year.

If the setting of this limit at $10,000 would render the measure unconstitutional simply because the type of business some legislators conduct is generally within that limit and that of other legislators is generally beyond it, it would be impossible to find a limit which would be constitutional. Wherever the limit is set, the great majority of the members of the Legislative Assembly will not be inconvenienced by the prohibition in any degree and some of the few whose business will be limited by the measure will be affected in a greater degree than, others, depending entirely upon the volume of business, it has been their custom to do with the State and its subdivisions. Where size is a proper index to an evil, a legislature may discriminate between the great and the small. Engel v. O’Malley, 219 U.S. 128, 31 S.Ct. 190, 55 L.Ed. 128; Heath & Milligan Mfg. Co. v. Worst, 207 U.S. 338, 28 S.Ct. 114, 52 L.Ed. 236. In this case size is a proper index. In the ordinary course of events the amount of profit in any transaction is proportionate to the size of the transaction since it is customary for businessmen to compute profits at a certain percentage of the gross. The greater the opportunity for profit, the greater is the' temptation to venal .acts on the part of the legislators and it was for the people in the exercise of ;the legislative power, to decide at what' particular point the size of a- transaction might impair the effectiveness of a legislator’s service. Exactly the same principle of law and the same reasoning applies to the provision of the initiated measure which bars a corporation, in which a member of the Legislature owns five percent or more of the assets, from doing business with the State or its subdivisions. It is our view therefore that neither of these classifications violates either the 14th Amendment to the Constitution of the United States or Section 11 of the Constitution of North Dakota.

In this connection we wish to point out that the federal statute which was attacked and held valid in Perkins v. Lukens Steel Co., supra, applied only to manufacturers who had contracts with the U. S'. Government in the sum of $10,000 or more. While the opinion in the case does not mention this classification we think there is some significance in the fact that it was not challenged by the Lukens Co. on the ground that it was arbitrary or discriminatory.

The view generally expressed in the decided cases is that the power of the state to choose from whom it will purchase supplies or whom it will employ is entirely unrestricted ; that the state has as much freedom as private individuals in selecting those with whom they will, do business. This Court said so in Tribune Printing & Binding Co. v. Barnes, supra, and the Supreme Court of the United States said so in Perkins v. Lukens Steel Co., supra. Nevertheless, since we are not unanimously agreed upon this question we have considered the challenged classifications in the light of the rules applri cable to the regulation by the state of the business of others a field in which the power of the state is concededly more restricted than it is when dealing with its own affairs and we have come to the conclusion that even when so considered the' classifications are neither arbitrary nor discriminatory.

It is also urged by the-plaintiff that the initiated measure violates the Constitu- . tion of North Dakota by providing qualifications for the office of members of the Legislative Assembly in addition to those provided by the Constitution. We see no merit in this contention. The initiated-measure does not touch ' qualification for office at any point. Those who wére qualified before its passage are still' qualified. It is true that one, whose livelihood is derived chiefly from doing business with the state and its subdivisions, may think twice before he becomes a candidate for the legislature, but the mere fact that a man cannot afford to accept an office is not in any sense a legal disqualification.

Finally, we reach plaintiff’s contention that the initiated measure violates Section 43 of the Constitution of North Dakota, this section provides:

“Any member who has a personal or -private interest in any measure or bill proposed or pending before the legislative assembly, shall disclose that fact to the house of which he is a member, and shall not vote thereon without the consent of the house.”

The argument that the initiated measure violates the foregoing provision of the Constitution seems to be that the Constitution by providing how a legislator shall conduct himself when he has a private or personal interest, grants to all members the right to have personal interests of every nature or description in all matters coming before the legislature until such time as the Constitution is changed. Certainly the provision contains no express grant, and it seems to us that the contention that the construction urged, follows as a necessary implication of the language used, is too far fetched to warrant serious consideration.

The judgment of the District Court is therefore modified to conform to this opinion and the case is remanded to the District Court for the entry of a declaratory judgment, settling the rights and status of the parties hereto.

BURKE, C. J., and MORRIS and SATHRE, JJ., concur.