                       May   3,   1965



Honorable R. Ii.Cory, Chairman           Opinion No. C-429
State Affairs Committee
House of Representatives                 Ret   Constitutionality of
Austin, Texas                                  House Bill 583.
Dear Represe~ntative~cory:
          You have requested an opinion from this office con-
cerning the constitutionality of House Bill 583 of the 59th
Legislature.
          Section 3 of Rouse Bill 583 provides in part that
from and after the effective date of the Act no person ehall:
          “(a) Offer, use, make use of, or attempt
     to offer, use or make use of, any gift enterprise
     of any nature whatsoever, directly or indirectly
     In or with any retail sale of gasoline, 011, OP
     other petroleum product for use in any motor
     vehicle.
          “(b) Use, issue, furnish or distribute, in,
     with, or for the retail sale of any gasoline, oil,
     or other petroleum products for use in any motor
     vehicle any tickets, coupons, certificates, carda,
     stamps, or other similar devices, as a part of or
     In connection with any gift enterprise as herein
     defined.”
          Section 2(b) of House Bill 583 providea that “gift
enterprise” shall means
          I, s .the selling of anything with a promise,
     either’express or implied, to give anything in
     consideration of such sale or any plan, scheme,
     device or arrangement whereby the seller either
     expressly or impliedly promise8 to give the buyer
     anything In consideration of such sale and shall

                              -2020-
Hon. R. H. Cory, page 2 (c-429)


     include but not be limited to the issuing, supply-
     ing, distributing, or furnishing, in, with, or for
     the sale of goods, wares, or merchandise any tickets,
     coupons, certificates, cards, stamps, or other
     similar devices, which ahall entitle the.purchaser
     receiving the same wlth the sale of such gooda
     wares or merchandise to procure from any person,
     firm, association, or corporation, any goods,
     wares, or merchandise upon the production of any
     number of such tickets, coupons, certificates,
     cards, stamps, or other similar devices."
          Section l(a) and Section 7, the emergency clause of
the Act, of House Bill 583, state that the Act 18 enacted pur-
suant to the provisions of Section 47 of Article III of the Con-
stitution of Texas. Section 47 of Article III of the Constitution
of Texas provides that:
          "The Legislature shall pass laws prohibiting
     the establishment of lotteries and gift enterprises
     In this State, as well as the sale of tickets in lot-
     teries, gift enterprises or other evasions involving
     the lottery principle, established or existing in
     other states." (Emphasis added),
          In passing   upon the constitutionality of House Bill
583, the initial consideration must deal with the queetion of
whether the acts prohibited by House Bill 583 are the type of
acts which the provisions of Section 47 of Article III of the
Constitution of Texas directs the Leglelature to enact laws to
prohibit.
          House Bill 583, in effect, prohibits and makes It a
misdemeanor, puniehable by a fine or lmprlsomnent or both, for
anyone to use, issue OP distribute any tickets, coupons, certlfi-
cates, Card8, stamps, or other sSmllar devices in connection with
the retail sale of gasoline, 011 or other petroleum products for
use in any motor vehicle under an arrangement which would entitle
the purchaser of the gasoline, 011 or other petroleum product to
procure goods, wares or merchandlae In exchange for such tickets,
coupons, certlficatee, cards, stamps or other similar devices,
          For the foregoing prohibited acts to fall within the
scope of the mandate found In Section 47 of Article III of the
Constitution of Texa8$ such act8 must in actuality, and not merely
in name, be a lottery, gift enterprise or other evasion involving
the lottery principle.
          The provisions of Section 47 of Article III of the Con-
stitution of Texas were diecussed at great length by the Supreme
                             -2021-
 ,


Hon. R. H. Cory, page 3 (C-,429)

Court of Texas in the case of City of Wink v. Qrlffith Amusements
co., 129 Tex. 40, 100 S.W.2d 645 (193o), in which the court stated:
               .It is hardly necessary to argue that
     the 'B&& Night' plan of the defendant In error
     if not a lottery, is at the very least a 'gift
     enterprise involving the lottery principleO, and
     obviously an evasion of the lottery laws of the
     state. That 'gift enterprIseaD are a form of
     lottery evasion is 80 well known that courts
     take judicial knowledge of the plan.  . . .*


          I,
             e .If it be granted that the plan of
     defendant In error!8 IBank Night' was not a
     lottery because a charge was not made for the
     registration entitling one to participate Sn
     the drawing (and this is the only distinction
     which Is here or could be made), then It clearly
     comes within the condemnatorv terms of the Con-
     stitution, because it Is a 'gift enterprise' ln-
     volvln
     _g      the o er            e, whlc    e author ies
     hold I that princlpl by which something Is to be
     given zy chance. . *eq
          "In general, It may be said that chance Is
     the basic element of a lottery. Unless a scheme
     for the awarding of a prize requires that it be
     awarded by a chance, it is not a lottery. o . D
          "There are9 however, in a lottery, according
     to the authorities, three neceaeary element89 namely,
     the offering of a prize, the award of the prize by
     chance, and the giving of a consideration for an
     -unity      to wfn the prize. 0 .But the Constitu-
     tion condemn8 those things which fall short of con-
     taining all of the essential elements of a lottery,
     namelv. those thinns which involve the lotterv
     principle, of whi& PchanceD is the one which-con-
     stitutes the very basis of a lottery, and without
     which it would not be a lottery. ' (Emphasis added).
The decision of the Supreme Court of Texas in City of Wink v.
Griffith Amusement Co., supra., makes it abundantly clear that
the course of conduct condemned by Section 47 of Article III Of
the Constitution of Texas must be either a lottery or involve the
lottery principle, and to fall within this category 8.nyso-called
lottery, gift enterprise or other evasion involving the lottery
principle must have present the essential element of a lottery--
namely, the element of chance.  The prize or thing to be awarded
must be determined bv chance. These orincioles laid down bs our
Supreme Court in City of Wink v. Griffith Amusement Co., 8upraQ,

                            -2022-
Hon. R. H. Cory, page 4 (C-429)


that
^. _ a lottery .or gift enterprise
                            _       Involves the element of chance,
flnas support In numerous aecislons from other jurlsdlctions.
S@&II~Orio v. Jacobs, 275 P. 563 (WaSh.SUp. 1929); D'Orlo v.
      p Candy C0.9 2b6 13.1037 (Utah Sup. 1928); RUSSell v.
Equltable Loan & Security Co., 58 S.E. 881 (Georgia Sup. 1907);
State v. Fox-Great Fall8 Theater Corp., 132 P.2d 689 (Montana
SUP. 1942); G n ited Jewelers Mfg. Co. v. Keckle , 90 P. 781
(Kan. Sup. 1907) Bills v. People, lb.1P 2d 1
1947); City of Oiford v. Ritz Theater, lb0 So~8fi~~::d~g~~;
Barker v. State, 193 S.E. 605 (0eorgia Ct.App. 1937).
          While the provisions of House Bill 583 state that It is
enacted pursuant to the provisions of Section 47 of Article III
of the Constitution of Texas, and define8 the prohibited acts as
a gift enterprise, we are of the opinion that when the prohibited
acts are tested by the principles set forth In Cit of Wink v
Griffith Amusement Co., supra., that an easenti*8L
lacking, and i the absence of such element the acts prohibited
in House Bill g83 cannot be regarded as the lottery, gift enter-
prise or other evasion Involving the lottery principle to which
Section 47 of Article III of the Constitution of Texas is directed.
          The essential element which is absent from the acts
prohibited in HOUSe Bill 583 is the element of chance. In the
instant case the prize or thing to be awarded is not determined
by chance. The purchaser of gasoline, oil or other petroleum
product8 at retail, for use In his motor vehicle and who is given
tickets, coupons8 certificates, cards, stamps or other slmllar
devices, is not dependent upon the element of chance In the pro-
curing of his award or prize in the form of gOOdsr wares or mer-
chandise--he merely surrenders a specified number of tickets,
coupons, certificates, cards, stamps OP other slmllar device8 in
exchange for certain specified goods, wares or merchandise.
          Consequently, in view of the decision in City of Wink
v. Griffith Amusement Co., supra., and the principles setforth
therein, we are of the opin'ionthat the acts prohibited by House
Bill 583 are not the type of acts which the provisions of Section
47 of Article III of the &nstltution of Texas direct8 the Legis-
lature to enact laws to prohibit,
          As we are of the opinion that Section 47 of Article III
of the Constitution of Texas is neither a mandate to, noP authoriza-
tion for, the Legislature to prohibit the course of conduct set
forth in House Bill 583, it then become8 necessary, in passing upon
the constitutionality of House Bill 583, to ascertain if the pro-
visions of the Act, which clearly regulate, if not in fact prohibit,
certain bu8inesSeS and occupations, as well as restricting the use
of private property and the freedom of contract, are a valid ex-
ercise of the police power of the State. If the provisions of


                            -2023-
Hon. R. H. Cory, page 5 (C-429)


House Bill 583 are within the police power of the State, the
Act is constitutional. However, should the provisions of House
Bill 583 exceed the police power of the State, the enactment then
contravenes the due process clause of the Constitution of Texas,
Section 19 of Article I, and is unconstitutional.
          It Is clear that in order for House Bill 583 to be a
proper exercise of the police power of the State it must be
reasonably necessary to the protection or improvement of the
public health, safety, morals, good order, comfort and general
welfare. 12 Tex.Jur.2d 415, Constitutional Law, Sections TO-
111. As was stated by the court in Ex Parte Smythe, 116 Tex.
Grim. 146, 28 S.W.2d 161 (1930   and in Neel v. Texas Liquor
Control Board, 259 S.W.2d 412 t$ex.Civ.App. 1933 , error re *,
n.r.e.), the bill must:
          II
           . . .have some reasonable relation to the
     subjects included in such power, and the law must
     tend, in a degree that is perceptible and clear
     toward the prevention of some offense ormst
     evil, or the furtherance of some object within the
     scope of the police power.       6 R.C.L. Constl-
     tutional Law, Paragraph 227:"' (Emphasis added).
          It was said of the police power of the State in Houston
& T.C. Ry. Co. v. Dallas, 98 Tex. 396, 84 S.W. 648 (1905), at page
    and quoted w    approval in Neel v. Texas Liquor Control Board,
~~~r~~,,,,,,,~:~~~~~a':'      S.W.2d b4b (Civ.App. 1949, error ref.)

          "It is commensurate with, but does not
     exceed, the duty to provide for the real needs
     of the people in their health, safety, comfort,
     and convenience as consistently as may be with
     private property rights. o .But as the citizen
     cannot be deprived of his property without due
     process of law9 and as a prevention by force of
     the police power fulfills this requirement only
     when the power is exercised for the purpose of
     accomplishing, and In a manner appropriate to
     the accomplishment of, the purpose for which it
     exists, it may often become necessary for courts
     0 s .to inquire as to the existence of facts upon
     which a given exercise of the power rests and into
     the manner of its exercises and If there be an in-
     vasion of property rights under the guise of this
     power, without justifying occasions OP In an un-
     reasonable, arbitrary or oppressive way3 to give
     the injured parties the protection which the Con-
     stitution secures,It

                            -2024-
Hon. R. H. Cory, page 6 (C-429)


          Large discretion necessarily is vested in the Legls-
lature to determine not only the requirements of the public ln-
terest, but also by what measures those interests may be properly
and effectively secured, If there is room for a fair difference
of opinion as to the necessity and reasonableness of an enactment
on a subject lying within the domain of the police power the
courts will not Interfere. 12 Tex.Jur.2d 422, Constitutional Law,
Sec. 76. Rut, as was pointed out by the courts in the foregoing
decisions, the judgment of-the Legislature does not conclude ln-
quiry by the courts as to the existence of the facts essential
to support the exercise of the police power.
          Section 1 of House Bill 583 provides in part that:
          "The Legislature finds as facts and determines
     that.2
          II
            . . .
          "(b) The sale of gasoline, oil and other
     petroleum products at retail for use In motor
     vehicles is a substantial and integral part of
     the economic life of the State, providing a means
     of livelihood for in excess of 40,000 Texas gaso-
     line service station operators and their families
     as well as providing employment for thousands of
     other Texas citizens employed by such petroleum
     retailers.
          "(c) The State of Texas and the Texas public
     have a vital interest in the maintenance of a
     sound and healthy economy In the retailing of gaso-
     line and other petroleum products, not only because
     of such retailers' contributions to the State's
     total economy and the care and maintenance of motor
     vehicles traveling on Texas highways, but also,
     because such retailers each year collect for the
     State of Texas hundreds of millions of dollars on
     taxes on gasoline and other petroleum products in
     which taxes such retail operatorsare being forced
     to furnish and distribute stamps, coupons and other
     such tickets or devices as a part of various kinds
     of gift enterprises established in the retail sale
     of gasoline, oil and other petroleum products.
          "(d) The gasoline retail market in Texas is
     in a state of chaos and despair with thousands of
     service station operators being forced out of     .*
     business each year due to long prevailing, bare
     subsistence margins of retail operations over


                            -2025-
Hon. R. H. COrY, Page 7 (c-42q)


    which such retail operators have no control and
    from which they are helpless to extricate them-
    selves since, unlike,the free and competitive
    market prevailing in the sale and distribution
    of ordinary products and commodities, service
    station dealers and operators are, in practically
    all instances, not free to bargain as to the
    prices for which they purchase gasoline and
    other petroleum products from their supplier
    and unable to freely and Independently determine
    the sales price of their products.
          "(e) Gift enterprises and the giving, dls-
     tributingo and the furnishing of tickets, coupons,
     certificates, cards, stamps and other similar de-
     vices with retail sales of gasoline, 011 and
     other petroleum products are substantial contribu-
     ting factors to the prevailing chaotic retail market
     conditions in Texas and the losses and business
     failures of thousands of small independent serv-
     ice station operators each year.'!
          The only decision by the courts of this State concerning
the prohibition of acts similar to those found in House Bill 583,
namely the giving of trading stamps in connection with the purchase
of a product, is the case of Texas Liquor Control Board v. Super
Savings Stamp Company, 303 S.W.2d b,36 (Tex.Civ.App. 193'0   Whir
the court In this case stated that it was within the authority 0:
the Texas Liquor Control Board to promulgate a rule or regulation
prohibiting the giving of trading stamps in connection with the
sale at retail of alcoholic beverages, we are of the opinion that
this decision affords little, if any , assistance in connection
with the Issue of whether the giving of trading stamps In con-
nection with the retail sale of gasoline, oil and other petroleum
products Is within the police power of the State. The sale of
alcoholic beverages is by Its very nature in an area in which the
State may exercise its police power for the protection of the
public health, safety, morals9 good order, comfort and general
welfare. However, the exercise of the police power of the State
in this specific area dealing with the sale of alcoholic beverages
would not necessarily justify Its exercise in the area of the
retail sales of gasoline, oil and other petroleum products which
do not have connected w9th:;thezi.r
                                 sale the possible detriment to
the public interest or welfare.
          While there have been no court decisions In Texas
dealing specifically with the constftutionality of a statute con-
taining provisions similar to those contained fn House Bill,583,
there have been an abundance of court decisions in other jurfs-
dictions upon similar statutes.,

                           -2026-
Hon. R. H. Gory, page 8 (C-429)


          While there is a definite split of authority on this
question, the great majority of the State court opinions hold
that statutes prohibiting and regulating the use of trading stamps
are unconstitutional as not being within the sphere of the police




                                                      jfht3.
                                                z-co.,
                                                   ices. 226 m&s.




Stamp Legisiatibn; 134 A.L.R..Constitutlonality of Statute Pro-
hibiting Giving of Premiums or Trading Stamps with Purchase of
Commodities; 133 A.L.R. 1087, Constitutionality of Statute PPO-
hibiting Giving of Premiums or Trading Stamps.
          In fact, there appears to be only two decisions In the
United States since 1919--Steffey v. City of Casper, 357 P.2d
456 (wyo. 1961) and Cushenberry v. Shanahan, 190 Kan. 378, 378
P.2d 66 (1963), which have held this type of legislation to be
constitutional.
          The minority view that legislation prohibiting or
severely curtaialng the use of trading stamps is a valid exercise

                           -2027-
Hon. R. H. Gory, Page 9 (C-429 )




          In Ed. Schuster & Co. v. Steff'es,237 Wis. 41, 295 N.W.
737 (1941), a statute whlch,,in effect, prohibited the use of
trading stamps to avoid the state's fair trade act was sustained.
That case may be regarded.as being on different footing from that
of a statute which, in effect, abolishes the use of trading stamps.
          Trading stamps have been said by the courts taking the
minority view to8 ?appeal to cupidity and lure to improvidence,"
 the Rast case); produce.?provoked and systemized reckless buying,"
Ithe Eer    case); "encourage indiscriminate and unnecessary pur-
chasing" and"force other merchants into using stamps or suffer
loss of trade by failure to do so" (the Pitney case). They have
been called the tools of a business which "is a mere parasltetn
[the Underwood case). They have further been said to produce
,,pern‘fcious
            and evil effects," (the Wgig;e case); and to tak: a
 large sum of money. e .from the mere an and his customers9
and add $0 the gross cost of living of all the people of the
District, (the Kraft case).
          However9 a most forceful rebuttal to the minority
view's arguments is found in the case of Lawton v. Stewart Dry
Goods Co., 197 Ky. 394, 247 S.W. P48 16 (1923js where the court
stated8
         "In the first place it is said that the
    trading stamp or premium system encourages pro-
    fllzate and wasteful buying and operates as a
    lure to Improvidence. As a matter of fact, it
    is simply a convenient method of allowing a dis-
    count for cash. Therefore, it encourages cash
    buying and operates as an incentive to prudence'
    and economy. But let us assume that it is a lure
    tc improvidence, Have we reached the point where
    the prohibition of every business that leads to
    improvidence may be regarded as a proper governmental
    function? Nothing is more alluring to the purchaser

                           -2028-
Hon. R. H. Gory, page 10 (C-429)
                                              ,



    than an attractive advertisement or a beautiful
    shop window, but can it be said that the merchant
    who employs such means to Increase his profits may
    be put out of business because, perchance, some
    one may see the advertisement or look in the-win-
    dow and be Induced to buy when he cannotafford
    to do so? If so, how f    may the doctrine Abe
    carried? Why not prohir It all forms of sdvertislng
    and the sale of all articles of luxury on the ground
    that they lead to extravagance? Why not require
    every merchant to restrict his stock to overalls or
    cotton dresses so as to reduce the 'lure' to a     r
    minimum?
         "Another objection Is that the trading stamp
    Introduces into business a middleman who receives
    a profit, not only from the stamps sold, but from
    those that are not redeemed, and thereby adds to
    the cost of the article. If the middleman may be
    dispensed with, what is to become of all agents,
    factors, brokers, and commission merchants? In-
    deed, why not go all the way and prohibit not only
    all retail merchants, but all wholesale merchants
    and jobbers and compel everybody to buy directly
    from the manufacturer?
         "Another alleged evil is that the trading
    stamp or premium gives opportunity for fraud in
    values and prices. It is true that one may use
    the trading stamp or premium dishonestly, just
    as he may be dishonest in other respects, but we
    fail to see wherein the'use of~trading stamps or
    premium affords any greater opportunity for fraud      .
    than already exists. Indeed, all businesses af-
    ford an opportunity for fraud in values and prices,
    but a business that may be dishonestly conducted
    should not be prohibited because of the dishonesty
    of some who are engaged ,in the business.
         "Another contention is that the trading
    stamp gives opportunity for coercion, in that
    merchants are compelled to buy in order to com-
    pete with their rivals. Doubtless the trading
    stamp company may ask one merchant to buy its
    stamps on the ground that his competitors have
    bought or intend to buy, but that is not a form
    of coercion of which the.~~law
                                 will take notice.
    The same method of making sales is followed by
    all business houses> particularly the wholesalers
    who desire to introduce some novelty or a new

                           -2029-
 .




Hon. Ft.H. Cory, page 11 (C- 429)


     line of goods, and, if the legislature undertook
     to prohibit every business whose agents indulged
     In the practice of arousing a spirit of rivalry
     among theircustomers, the channels of trade would
     soon be closed."
          The court stated in Sperry & Hutchinson Co. v. McBride,
supra., that:
          "Trading stamps have been in use long
     enough so that any purchaser of merchandise
     who is Interested in acquiring and converting
     them to his advantage cannot be said to be
     likely to be deceived as to their value.
               .there is no reasonable cause to believe
     that the'dealer who offers them in consideration
     of cash or approved ccedit sales will resort to
     fraudulent practices.
          In People v. Victor, 287 Mich. 506, 283 N.W. 606 (1939),
the Court held unconstitutional a statute which orohibited -ertain
classes of merchants from giving premiums, such as trading stamps
to promote sales. The court said:
          'By giving a premium, the defendant was
     merely offering the purchasing public more for
     its money. Surely there is nothing reprehensible
     in that. It Is apparent that the giving of a
     premium has no evil effects which the Legislature
     has sought to correct. . .There is no reasonable
     relation between the prohibition of the giving of
     a premium and the protectio$ of the public health,
     morals, safety and welfare.
          Attorney General's Opinion No. WW-1047 (1961) dealt
with the constitutionality of House Bill 438, Acts of the 57th
Legislature, Regular Session (1961). House Bill 438, which was
not enacted into law, contained essentially the same type of
 rovisions found in the present House Bill 583. While House Bill
fi
 38 was much broader in scope and not limited merely to the re-
tall sale of gasoline, oil and other petroleum products for use
in motor vehicles as is House Bill 583, each of these bills are
essentially the same in operation as they would prohibit the
giving of trading stamps or other similar devices in connection
with retail sales.
          Attorney General's Opinion No, WW-1047 (1961) held that
House Bill 438 was unconstitutional and stated therein that!


                           -2030-
Hon. R. H. Cory, page 12 (C- 429)


         "Doubtedless, trading stamps may be a
    source of annoyance to some. The use of these
    stamps may be especially worrisome and, indeed,
    even costly to many merchants who feel obliged
    to use them in order to meet the competition
    from other stores that do so. But does this
    reasonably necessitate the assertion of the
    police power? In our opinion, It clearly does
    not. In Spann v. Dallas, supra., it was ob-
    served in page >lb :
         'It is with common humanity--the average
    of the people that police laws must deal. A
    lawful and ordinary use of property is not to
    be prohibited because repugnant to a particular
    class.'
         "Moreover, would it not be just as reasonable
    to outlaw advertising or credit or 'free parking'
    at Fto.+esand 'free delivery service' or 'free
    gift flapping' or any one or more of the count-
    less other trade inducements which are customarily
    utilized by merchants In a competitive business
    economy. These 'extras' surely add to the cost
    of doing business just as do trading stamps. They
    also oblige the other merchants to do likewise in
    order to hold their trade. Indeed, some merchants
    may not be able to meet the competition. But is
    that not what free enterprise is: the right of
    every citizen to use his property as he chooses,
    and as best he cans without interference from the
    government, so long as the rights of others are
    not infringed upon? And, there is no right to be
    free from fair competition, that 'right' and our
    American right to compete honestly being mutually
    exclusive.'


          "It follows from the foregoing that, in our
     judgment, not only the weight of authority, but
     the better reasoning, pre onderates in favor of
     the view that House Bill t38 bears no reasonable
     relation to any legitimate object within the scope
     of the police power, and, therefore, the bill contra-
     venes the due process clause, Section 19, Article I,
     of the Constitution of Texas."
          We are of the opinion that the result reached in At-
torney General's Opinion No. WW-1047 (1961), concerning the

                           -2031-
.,    .




     Hon. R. H. COrY, Page 13 (C-429)


     constltutlonality of House Bill 438, and the principles upon
     which results were based are equally applicable to House Bill
     583.
               While the statement of factual findings in Section 1,
     Subsections (b) through (e), of House Bill 583 attempts to over-
     come one of the objections raised in Attorney General's Opinion
     WW-1047 (1961) to the effect that:
               "Significantly, House Bill 438 is silent as
          to the ultimate evil at which it is directed. It
          fails to cite any reason why it could be to the
          public interest to prohibit and restrict the use
          of trading stamps in the manner provided in the
          bill. We can perceive no danger to the public
          welfare in the use of trading stamps which would
          warrant the complete prohibition of their use by
          retailers, wholesalers, stamp companies, consumers
          and others who might use such stamps. We are left
          to conclude that the reason for the enactment falls
          among those which have been discredited by the maj-
          ority of the courts of the country."
               We are of the opinion such attempt is nevertheless
     insufficient to cure the unconstitutionality of House Bill 583
     for two reasons.
               First, the ultimate evil sought to be eliminated by
     the prohibitions in House Bill 5839 as stated by the factual
     findings in Section 1 thereof is the chaos and economic difficui-
     ties being encountered by those persons engaged in retail sale of
     gasoline, 011 and petroleum products for use in motor vehicles
     who give trading stamps in connection with the sale of their pro-
     duct. This chaos and economic difficulty referred to in House
     Bill 583 does not affect the public generally, but is limited
     to only that segmt.,tof business involved In the retail sale of
     petroleum products for use in motor vehicles. AS stated in 16
     C.J.S. 944, Constitutional Laws % 195r
               I, o ./Ti?lelegislature cannot.use the
          police'poweras a subterfuge to do something
          that it otherwise could not do In the infringe-
          ment of private interests or the restraint of
          private rights.  The police power must be ex-
          ercised for public purposes only; the legisla-
          ture may not exercise the police power for private
          purposes, or for the exclusive benefit of particular
          individuals or classes. e 0 .'
     Such being the cases House Bill 583 appears to be merely an effort
     to ease the economic plight of a segment of the business world
                                  -2032-
                                                                 .




Hon. R. H. Cory, page 14 (C-429)

rather than a valid exercise of the police power of the State
In the interest of the health, safety, morals, good order,
comfort and welfare of the public in general.
          Secondly, the great weight of authority, and the
trend of court decisions since 1919 in that only two courts
since 1919 have held similar acts to be constitutional, while
at least fifteen states have held legislation banning the
use of trading stamps to be unconstitutional, leads us to the
conclusion that statu,tesprohibiting and regulating the use
of trading stamps, such as House Bill 583, are not within the
valid exercise of the police power of a State and are therefore
unconstitutional.
          In view of the foregoing, we are of the opinion that
House Bill 583 is unconstitutional by reason of being beyond
the scope of the police power of the State and in contravention
of Section 19 of Arti~cleI of the Constitution of Texas, which
provides:
          'Sec. 19. No citizen of this State shall
     be deprived of life, liberty, property, prlvi-
     leges or immunities, or in any manner dlsfran-
     chised, except by the due course of the law of
     the land.!
          We are not passi   upon whether the findings of fact
which appear in paragraphs%   , (d) and (e) of Section 3 of Houee
Bill 583 violate our antitrust statutes.
                      SUMMARY
          House Bill 583, 59th Legislature, Regular
     Session (1965) is unconstitutional by reason
     of being beyond the scope of the police power
     of the State and therefore in contravention of
     Section 19 of Article I of the Constitution of
     Texas.
                           Very truly yours,
                           WAGGONER CARR
                           Attorney General



                                Pat Bailey
                                Assistant
P%:mkh


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    Hon. R. B. Gory, page 15 (C- 429)


    APPROVEDS
    OPINION COMMITTEE
    w. v. Geppert,   Chairman
    Roy Johneon
    Sam Kellcy
    K&mal;tz

    APPROVED FORTRE ATTORNEY OENElRAL
    BY; Stanton Stone




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