r- .- VI THE LIQUOR TRAFFIC ▲NO COMPENSATION: A CHAPTER OF THE PROHIBITION CONTROVERSY. BY WM. BURGESS, TORONTO. : ri'. -♦"••"-♦- AVHY THE SUBJECT IS DISCUSSED WHO IS T(J PAY*? COMPENSATION DEFINED. THE LEGAL VIEW- Special Sanction by License. THE (QUESTION OF POLICY. PllECEDENTS CONSIDERED. License versus Right. WHO IS TO BE COMPENSATED ? The LiceuBed Victuallers' Claims. Property Right in License. Rejected Applicants' Claims. The Grocers' Claims.' ^ • • '• ' ' Distillers' and Brcv/ors' 'Jir'in-.s' ' Tjbe Workman's '.''aims. The Public Claim's ' •'•''■'■'■ ■> ^ The Com Laws — Railways — Cow- keeping— Toll Gates— Post Offices —Sunday Trains — Public Schools- Irish Land Laws — British Slavery Grant, &c., &c. ■ i HHE; MiMlAL'YIEW, I, . Jnffueni3eK)f Jjad Jisws ' • • • • • • . • * l"". " ^'^mpfetisiftion (.'Restitution. PRICE 10 CENTS, OR $1.00 PER DOZEN. SOCfETlES AXD THE TKAOE SCri'l.lED AT KKDl'CED KATES. «i ^ <»»« PUBLISHED AND SOLD BY THE 2S "TXTEIjX.X^ GhTOa:T ST; "'^T'EST, TOS^OI^n'0. ? 181.04 3 9)2 • ^ • » • * * * * » » « • t • • • • • • -• • ,< ^^V' THE LIQUOR TRAFFIC AND COMPENSATION. • •VI.'N.'V.'VW.'V.'V'V'V.'V.^'V.'V'V.A. VtW'V.VVWV A FLAG 0^ truce has been raised. The conflict described by one of the most distinguished brewers of England* as ** one development of the war between heaven and hell " has extended over a period of more than half a century. Strongly intrenched behind a wall of error, fashion, custom, and license, the liquor party treated the temperance Reformers with contempt and ridicule. In proportion as tl3 volunteer army increased in numbers and power, they were met with organized opposi- eion, and by vigorous defence measures, backed by enormous material resources. For a quarter of a century the temperance party regarded their forces as unequal to any close engagement with their powerful -opponents. But the tables are turned. Recent events prove that the hitherto invincible liquor traflfic can be successfully assailed. The constitutional battle of Maine, so signally triumphant, has been accompanied and followed by equally significant victories elsewhere. Fort after fort have been stormed and carried. In Canada, the Scott Act campaign has resulted, up to the end of January, in 54 victories out of 65 battles, with a total majority of 37,497 votes in its favour. Routed at the Battle of Halton — a Waterloo of their own choice — the courage of the liquor party has evaporated, and they have beaten a hasty and ignominious retreat. While the temperance army is still in the field, making wonderful progress towards the citadel of defence, the enemy have practically retired from the open field of battle, and are pleading for terms. Their appeal for compensatiou is an acknowledgment of a speedy dissolution of their forces. Regarded as an indication of the progress of temperance sentiment, it is the most interesting and • A remarkable article appeared in the North British Quarterhj Review about thirty years ago, entitled " How to Stop Drunkenness." The writei "advocated permissive prohibition by a vote of the electors, and remarked that "the struggle of tne school, the library, and the church against the beerhc use and gin-palace is but one develop- ment of the war between heaven and hell." It became known afterwards that the author of the article was Mr. Charles Baxton, M.P., a leading member of the great firm of Trumau, Hanbury, Boxtou, and Co., brewers, of London. KonnkA 4 THE LIQUOR TRAFFIC encouraging circumstance of the movement. When one of two bellige rents pleads for terms, the beginning of the end of war is at hand. It has been truly said that the question of Compensation is not before the public in any definite or practical shape. Its discussion, therefore, would be premature, but for the fact that the liquor party are industri- ously appealing to Members cf Parliament and other prominent citizens with the cry of confiscation of vested interests, and are burking the main question. The subject has already been raised in Parliament, during the debate on Prof. Foster's prohibition motion in March, 1884. Mr. Beaty, M.P. for Toronto, objected to the Dunkin Act and the Scott Act because they did not provide compensation. He went so far as to outline the possible cost of compensating the distillers, and it is signifi- cant that he seemed to regard these as the only parties who should be considered. The question is now before the Dominion Parliament. Mr. Krantz, M.P., has given notice of the following i^otion to be con- sidered in a committee of the whole House : " Resolved, That it is expedient whenever Parliament decides that a law pro- hibiting the importation, manufacture and sale of intoxicating liquors for beverage purposes should be enacted, that equitable provision should b'j made for the compensation di brewers, distillers and maltsters, so far as respects the diminution in value of the real property, premises and plant owned and used by them in their busineas. " It is obvious that the object of this motion is to commit Parliament to a measure for compensating distillers before public opinion has been expressed against it. With a view to influence the Government, the liquor sellers' great delegation to Ottawa on the 17th February proposes to represent that the public are in favour of compensation as well as to other concessions, and they are now presenting petitions to business men for signature after the manner of highwaymen, "your money or your life." A well-known manager of a Toronto loan company informs the writer that he has this week (Feb. 14) been threatened with "boycotting " if he did not sign the liquor sellers' petition. He was told that his name would be published all over the Dominion, and persons wanting to do business in his line would be warned against him. The impudent fellow who was thus attempting to bully the public into a "free and indepen- dent " expression of opinion is the eminent biblical authority and spirit dealer who undertook, in a series of letters to the Olohe, to enlighten the clergy as to their duty in reference to the Scott Act. COMPENSATION DEFINED. Compensation implies remuneration, reward, amends, or satisfaction for services, debt, want, loss, or suffering. It would be difficult for any- one to show on which of these grounds the makers and retailers of intoxicating liquors can base an appeal. They have rendered no service AND COMPENSATION. 5 to the country, nor placed the public under any obligation or indebted- ness to them. It is too true that want, loss, an(l sufiering have attended their business, to a greater degree than any other interests or evil in the world. Mr. W. K Gladstone describes them as being greater than the " combined evils of war, pestilence, and famine." But the liquor sellers have not been the sufferers. They have ' ' Fattened with the rich result Of all this riot. The ten thousand casks For ever dribbling out their base contents, Touched by the Midas tinger of the State, Bleed gold." — Cowper. while the whole community is placed under tax to meet the ravages of the unholy business. Nevertheless, the plea for remuneration, reward, or amends is so subtle that not a few of our best citizens have been captured by ir, before the first reason has been given or a single definite proposition of surrender has been made. Even earnest, sincere, and distinguished advocates of temperance have been moved to express sympathy with the cry that personal selfish interests, however disastrous to the public weal, should not be destroyed without reward or compensation. THE LEGAL CONSIDERATION. First, among the grounds upon which compensation to the liquor interest is claimed, is the theory that the State, by licensing the sale of intoxicating liquors, have thereby constituted it a legal business, and ought not to change its policy without providing for the prospective losses of those who have been encouraged to invest their time and capital in it. This proposition implies that the State must never make a change in the public interest without providing for losses that might accrue to certain persons under such change. It is the duty of the State to foster the development of national resources, and to encourage the investment of capital to that end. This principle involves the protec- tion of trade interests, and, in the minds of many leading statesmen, justifies the restriction of competition in order that home industries may be protected. But suppose it should be deemed advantageous to this country's interests, at some future time, to abandon the protective policy, would it be necessary first to assume that every manufacturer or merchant who has based his calculation of capital outlay, and future profits upon the permanency of the N. P. must be compensated 1 During the Parliamentary debate on Prohibition in March, 1884, Mr. Beaty said : " The first objection we have to meet is the compensation to those who are engaged iu the manufacture of this article in the country. I think it is only fair and reasonable, that if legislation should take away from the distillers 6 THE LIQUOR TRAFFIC ' their occupation and business, they shoiil I be, tn a reasonable extent, com- pensated fur the damages done to them by such legislation. That is the first p) inciple in connection with these matters. " The representative of Toront!) did not explain what he meant by com- pensation as the " first principle " of legislation, designed for the public good. As we shall show in another part of this pamphlet there is no precedent in legislation for compensation in connection with the prohi- bition or limitation of any business, although the name of those interests which have been interfered with by law is legion. It is late in the day to urge that no legal business ought to be restrained or suppressed by law without providing for the financial loss that may result to certain persons or interests. All trades are legal unless specially prohibited. A soap factory, a chemical manure works, or a cattle feeding establishment are legal, even if situated in the midst of large and populous neighbourhoods, until the law enacts the contrary. A dyeing house so situated that it pours a constant stream of poison into the lake upon wliich hundreds of people are dependent for th^ir daily drink is only illegal when the law so declares it. If such trades could not be removed — if the Government hiid no power to act in the interests of the general community without first providing for the invested capital and the possible prospective profits — there would be little hope at any time of securing the well-being of the many against the personal desires, interests, or greed of a few. Special Sanction by License. But it is argued that the license system invests the liquor traffic with special legal sanction, and if the State decides to withdraw that sanction, it is bound in honour to provide for the losses involved. Tliis argument proceeds from a mistaken idea as to the legal eifect of Governmental legislation on the liquor traffic. Prohibition is applied to all but a few. These feiv are permitted to sell on the basis of a contract or license. Such contract does not invest the business with extra legal force; it rather divests it of that legality which belongs to all ordinary business. It is therefore only semi-legal, or, in other words, it is lawful only under certain fixed contracts and condi- tions. No person can legally sell spirits or beer unless he is in pos- session of a special contract, or permit, empowering him to sell at cer- tain defined times, in a certain specified place, under certain specified conditions. License not a Right. Again, the liquor traffic does not exist by right. There is no la«^, natural, moral, or statutory, declaring the right to sell intoxicants. !No man can claim a license as a right, and no man holds a license •other than as a privilege or permit. On the other hand, all legitimate AND COMPENSATION. 7 trade is the right equally of every citizen. Anyone may become a provision dealer, a dry goods merchant, or a dealer in boots, shoes, i r clothing. Any person may open a restaurant or a hotel, and supply the public with steak and potatoes, tea and coffee, bed and board, without permission. No License Commission gives out restrictive contracts to a [)rivileged few to sell bread or fruit. But to sell liquor it is necessary to obtain a permit or privileged contract. Nor is a liquor license a mere tax charged with a view to revenue. A dog tax, an auction license, a pedlar's license, a cab license, are as rr.uch the right ni one person as another, but a liquor license is sought for and obtained as a favour, and never as a right. '* A privilege that the law bestows the law can revoke, provided no agreement is broken, no promise violated, no understanding set at naught." (See Appendix A.) WHO IS TO BE COMPENSATED] If a claim is to be set up on legal grounds, it would be well to con- sider — Who is to be Compensated 1 The Licensed Victuallers' Claim. On behalf of the hotel-saloonist it is urged that his interests are seriously damaged by the enforcement of any prohibitory law which deprives him of a renewal of his license. But it is answered, a liquor license is granted /wr one year only, without any understanding or agree ment as to a renewal of the privilege. The very essence of every contract granted for the sale of liquor is limitation of time, and as there is no legal claim to a renewal of that contract, so there is no injustice done to any person in refusing to renew a favour already enjoyed. An exhibition license is granted to a circus proprietor, giving him permission to exhibit within the limits of a city or town for a given number of days. If he desires the term of liis permit or license to be extended, no injustice is done him if he is refused, nor can he presume upon his obtaining a license next year oti the ground that he held one this year. A change of municipal govern- ment, or of policy, may have taken place, and the authorities may decide that it is against the interests of the community to allow repeated visits of circus exhibitions. A short time ago the Mitchell-Madden pugilistic gang obtained a license from the Toronto officials to give " an exhibition of science" in the Albert Hall. Public opinion was outraged^ and the Mayor issued an order that such licenses should not be granted in future. The case may be stated thus : — A lends B the sum of $1000 for one year, and at the end of the year the loan is renewed for one year more at the request of B. If A refuses to again renew the loan, no injustice is done to B, no matter how disastrously the refusal may affect hift 8 THE LIQUOR TRAFriC interests. It would be regarded as child's play, not to say base ingrati- tude for past favours, if the recipient of the loan were to set up a cry of compensation, on the ground that the renewal of the loan for the second year establishes a claim to its renewal in future years. Property Right in Licenbe. But it is alleged that the liquor seller has a property right in his license on the ground of expected renewals, since it has been customary to renew licenses, provided the licensees have not been convicted of any o£fences against the law. But the right to regard this custom as a precedent in law has been repeatedly denied by the highest legal authorities. At the Court of Queen's Bench, London, England, Mr. Justice Lopes, in dealing with a case of appeal against a magistrate's refusal to renew a license, cited a Law Text Book in which it was said : " In all cases of transfers of licenses the discretion of the justices is absolute."* Mr. Baron Pollock said '* he should be sorry to lay down any rule which would limit the discretion of the justices, but he should be still more sorry to give any ground for belief that a license was a kind of property in the landlord." Commenting on this subject The Lav) Times says : " We have been forced to the opinion that the interest of licensed victuallers is an annual interest only." The Law Journal says : " It is not arguable that licensed persons of any kind have a legal vested interest in their licenses." Mr. Justice Field says : *' In every case in every year there is a new license granted. You may call it renewal if you like, but that does not make the license an old one. The legislature does not call it a renewal, it calls it ' a grant by way of renewal.' The legislature recognizes no vested right at all in any holder of a license. It does not treat the interest as a vested one in any way." No Claim EsTABLisiiiiD under past Prohibitoky and Restrictive Laws. ' ' It is obvious that if any claim could have been made for compensating persons on account of suspension or non-renewal of license, it would have been established in a court of law long ago. The Provincial Government of Ontario, by passing the Crooks Act, deprived 2,000 per- sons of the privilege of liquor licenses. Municipalities have frequently passed by-laws limiting the number of licenses, thereby prohibiting the renewal of licenses to existing liquor dealers. By the Forbes Mackenzie Act, in 1854 the British Government reduced the liquor traffic by one- seventh. By virtue of his power as a landlord, the late Lord Claud Hamilton, M.P., prohibited the sale of liquor in a territory of 81 square * Licensing Justices ur M^igistrates act as License Commiiaioneri) in the United Kingdom. AND CT>MPENSATION. 9 miles in the county of Tyrone, Ireland, refusing to renew leases except on that condition. In numerous instances owners of property have totally exterminated drink shops by refusing to grant or renew leases except under conditions {>rohibiting the sale of liquor, and no consideration of compensation was eyer involved. The State of Maine has not only passed and maintained a prohibitory law, but has embodied it in its Constitution. Kansas, New Hampshire, and Vermont have also passed prohibitory laws. In none of these cases have compensation been considered as a condition of such changes, or even seriously debated, when the change has become law. (See Appendix B.) An able writer remarks : " In past centuries it was a received principle, acted upon unanimously, suddenly, and without compensation to traders, to forbid exportation of food, if food were scarce and inconveniently dear. For the same reason the con- version of grain into malt was occasionally stopped, and however sudden the prohibition, no compensation was given." — Alliance News, Eng. Claims of Rfjected Applicants for Licenses. If a claim for compensating persons for loss of privilege were allowed, what must be said of those who have desired the privilege and have never been favoured 1 There are many persons who have invested capital on the strength of the custom of granting hotel licenses, and have been refused. In many instances large premises have been erected and adapted to the business of a saloon-hotel, and the value of the place has been estimated upon the expectancy of obtaining a license. But the refusal on the part of the License Commissioner has destroyed the hopes of the speculator. Surely if a person who has had the privileged opportunity to make money by selling liquor for, say five or ten years, has any claim to consideration on account of the withdrawal of that privilege, the claim would be still greater on the part of the man who desired to enter the business, and invested capital in anticipation of it, but was denied the privilege. Yet no one has ever thought of proposing compensation in such a case. ' ■ The Grocers' Claims. Again, if a plea is made on behalf of the licensed hotel-keeper, why not for the grocer ? About a year ago the City Council of Toronto referred the question of abolition of grocer's licenses to the electors. A ballot vote was taken on Feb. 2 4th, 1884, and resulted in a majority of 349 in favour of separating the sale of liquor from the sale of grocer- ies or other commodities.* Recognising the action of the Toronto * The numbers of votes recorded on the (ineation of separation of sale of liquor from groceries were, For— 6565, Against — 5216. 10 THE LIQUOR TRAFFIC electors as in harmony with the public will of the country, the Provin- cial Government of Ontario confirmed the vote by a clause in the amended Crooks Act, ])Iacing it out of the power of the City Council to repeal the by-law. Now if any plea can be offered for compensating men for loss of privilege, surely the grocers of the city of Toronto, and other places where similar votes have been taken, would be in a position to make a good case. It may be observed here that they have at least as good a right to sell liquor as an hotel-keeper. Their business is j)eculiarly that of retailers of articles of general consumption. If it is for the public good that the sale of liquor should be divorced from the sale of tea, coffee, suj^ar, and spices, it is logically for the public good that it should be abolished from the temporary homes of travellers — men, women, and children. And if to withdraw the sale of liquor from the hotel would be a source of temj)orary inconvenience and some loss of [irofits, it is not less so to the family grocer, who can no longer make liis store also the family wine and spirit depot. Yet no one has heard the cry of confiscation of grocers' interests seriously raised, and certainly the Licensed Victuallers' Association have not concerned themselves to establish a plea for compensation on their behalf. Distillers and Brewers' Claims. On behalf of the distillers and brewers it is claimed that a special claim to compensation can be made. It must be admitted that some, even of our temperance friends, admit special circumstances in their case, and are hesitating to commit themselves wholly to a radical scheme of prohibition which does not include some money consideration for the liquor manufacturers. It is argued that the capital of the brewer and the distiller has been invested in good faith, in view of the acquiescence of the law. Mr. Beaty, M.P., speaking in the House of Commons, says : — " Tliat is the first obstacle we have to meet — oompensation — and yet that would not be a very great matter, beca\ise in Canada, at the present day, there are only seven distilleries. Five of those do not amount to much as to value or ])roduction. Two of them — the distillery at Toronto and the distillery at Windsor — are very large concerns, and would represent at least, I should imaj;ine, two-thirds of the whole value of the seven distilleries. The whole value of the property included in this question of distillation would, then, as was represented by one of the Inland Revenue officers, only represent about ^5,000,000, and the Toronto distillery would represent about a half of the whole. So the question of compensation would not be so serious a question, involving only — the interest account being taken as the only practical question — an expenditure to the country of about $100,000 or $200,000 a year as the case might be," This is special pleading for the rich distiller with a vengeance. Mr. Beaty ignores all other parties. His righteous soul is moved to sym- pathy for the poor distillers with their five millions of dollars worth of AND COMPENSATION. 11 property, and their further million of accumulated wealth. On what principle or from what fund he would pension off the seven distillers, at a cost of $100,000 or $200,000 a year, Mr. Beaty does not say. Nor does he say why he singles out the distillers for such tender considera- tion. Mr. N. W. Hoyle's Vifavs. A representative of the Toronto Crloha recently interviewed a. number of representative men of the liquor interests and the temperance move- ment respectively, and among the most conspicuous of the latter is Mr. N. W. Hoyh^s, Vice-President of the C.E.T.S. in Toronto. His opinion will command special notice, not only from the fact that he is a pro- minent and mcst earnest advocate of the c. use of temperance, but also as a lawyer of considerable practice he may be supposed to speak with some knowledge of legal precedents. Speaking of compensation of the liquor interests, he says : *'I find it exceedingly hard to satisfy myself on that point as to what I ought to think. I am convinced of one thing, however, — that there should be compensation to those wlio lose directly by the chanL;e. If a man has invested a large sum of money in buildings and api^ilianoes fir making li<[Uor whde tho law allows him to do so, T cannot reconcile it with my idea of justice that ho should have his property made valueless and no reparation given. Apply it to my own business for instance. Some people say that lawyers are a nuisance, and if they could havo their way our business would be abolished. I d ■> -» i 50 "" APPENDIX. contrary, they wish nothing but the fullest justice done to all concerned — bat that will include the public as well as the publicans. They would not rob the publican of a single pennyworth of his property, and do not even insist on his closing his shop. As he delights to call himself a licensed victualler, they would be glad to see him providing good victuals and harmless beverages for his customers. All that they demand is that he shall cease to sell alcoholic liquors, and that his claim to compensation for having to do so shall not be granted until he proves it just. Sir Wilfrid Lawson stated exactly the atti- tude of the temperance party to this question when he wrote, on the 6th of July, 1880, in reply to a correspondent, as follows : — " I have never admitted that a licensed drinkseller has any right to compensation after the expiration of the period for which his license had been granted. I neither admit nor deny the claim ; I wait to hear it fairly stated and argued. Mr. Gladstone advocates equitable compensation, and I think that he is quite right. I do not wish to do anything that is inequitable. But we shall have a good deal to say as to what is the true meaning of equitable compensation before this matter is settled." Mr. Gladstone himself has never admitted the publican's claim to compensation. What he has said is this : — " Their fair claims to compensation, if they can make good their case (there is much virtue in that if!), ought to be considered. I am not prepared to say whether there is a case for compensation, or whether there is not a case for compensation, be- cause that must depend on particulars that are not now before us." And the Marcjuis of Hartington, speaking of the brewers, says : — " They have no claim to compen ation if, through legislation in the interests of the people, legislation asked for by the people themselves, the consumption of intoxica- ting liquors should be materially diminished. I acknowledge no such claim as this, and I do not think that any such claim would be considered or en- tertained by Parliament." It is true, Lord Hartington makes a distinction between the claim of the brewers and that of the publicans ; but if the in- terests and wishes of the people nullify the one claim, they equally nullify the other. — Dk. McMurtry, at the Irish Temperance League Conference, Bel- fast, Jan. 12, 1885. Single copies of The Scott Act (Temperance Act of 1878), sent to any address, for 10 cents — In quantities, at 60 cents per dozen. Address Rose Publishing Co., 26 Wellington St., Toronto. PamrBD by Hpnxbr, Rose & Co. Toronto. t a «o * • * • • • « • " .•-•0 00 ft'ftO toco 06 . « S- O « 9 ° * » 00 '©"•O ,00 O -OOtO ft OftOfi