the dissenting opinion of Justice Barnhill. We allowed certiorari for that purpose.

The articles, bearing the plaintiff's trade name, sold and proposed to be sold by the defendants were and are lawfully acquired and owned by such defendant, having been purchased by such defendant "at bankruptcy sales and from various parties other than the plaintiff." Nothing in the record suggests that any defendant acquired any such article through the breach by its supplier of any contract between such supplier and the plaintiff. The prices charged for such products by each such defendant have been satisfactory to it and to its respective customers. Nothing in the record indicates that such selling defendant has failed to make a profit, deemed reasonable by it, upon any such sale, or proposes to do so.

The defendants assert that the provision of G.S. sec. 66-56, extending the force and effect of a “fair trade" contract to a seller not a party thereto, is invalid because it is an unlawful delegation of legislative power to a private corporation and also because it deprives the defendants of their liberty and property otherwise than by the law of the land, in violation of Article I, sec. 19, of the Constitution of North Carolina.

In Old Dearborn Distributing Co. v. SeagramDistillers Corp., 299 U.S. 183, 57 S.Ct. 139, 81 L.Ed. 109, the Supreme Court of the United States had before it the Illinois Fair Trade Act, which, in all respects material hereto, is identical with the North Carolina Act. The Court, in an opinion by Mr. Justice Sutherland, held that the provision of the Act, extending the force of the "fair trade" contract to a nonsigner thereof, was not "so arbitrary, unfair or wanting in reason as to result in a denial of due process," and that there was "nothing in this situation to justify the contention that there is an unlawful delegation of power to private persons to control the disposition of the property of others."

The decisions of the Supreme Court of the United States as to the construction and effect of the Due Process Clause of the Fourteenth Amendment to the Constitution of the United States are, of course, binding upon this Court. It is also true that the expression "The Law of the Land," used in Article I, sec. 19, of the Constitution of North Carolina, is synonymous with "Due Process of Law." Rice v. Rigsby and Davis v. Rigsby, 259 N.C. 506, 518, 131 S.E.2d 469. However, in the construction of the provision of the State Constitution, the meaning given by the Supreme Court of the United States to even an identical term in the Constitution of the United States is, though highly persuasive, not binding upon this Court. State v. Barnes, 264 N.C. 517, 520, 142 S.E.2d 344. See also, Corning Glass Works v. Ann & Hope, Inc., of Danvers, Mass., 294 N.E.2d 354.

Consequently, neither Lilly & Co. v. Saunders, supra, nor Old Dearborn Distributing Co. v. Seagram-Distillers Corp., supra, prevents us from a redetermination of the validity of the provision of G.S. sec. 66-56, insofar as it purports to extend to one not a party thereto the effect of a fair trade contract made by the plaintiff with another retailer.

G.S. sec. 66-56, in its application to non-signers of fair trade contracts is also invalid for the reason that it violates Article I, sec. 19, of the Constitution of North Carolina. The term "liberty," as used in this provision of the Constitution, is an extensive as is the same term used in the Fourteenth Amendment to the Constitution of the United States.

In Allgeyer v. Louisiana, 165 U.S. 578, 17 S.Ct. 427, 41 L.Ed. 832, the Supreme Court of the United States, speaking through Mr. Justice Peckham, said:

The "liberty" mentioned in that [Fourteenth] amendment means not only the right of the citizen to be free from the mere physical restraint of his person, as by incarceration, but the term is deemed to embrace the right of the citizen to be free in the enjoyment of all his faculties; to be free to use them in all lawful ways; to live and work where he will; to earn his livelihood by any lawful calling; to pursue any livelihood or avocation, and for that purpose to enter into all contracts which may be proper, necessary, and essential to his carrying out to a successful conclusion the purposes above mentioned.

Obviously, this liberty of contract is not absolute. Like the other aspects of liberty, it may be reasonably restricted by legislation, otherwise valid, for the protection of the public health, safety, morals or welfare, including economic welfare. As was observed in Nebbia v. New York, 291 U.S. 502, 54 S.Ct. 505, 78 L.Ed. 940, there is nothing "peculiarly sacrosanct about the price one may charge for what he makes or sells," and when the economic welfare of the public so requires, it is within the power of the state to fix a minimum as well as a maximum price for the sale of a commodity, even though the seller is not a public utility. It is also true that, within constitutional limits, it is the function of the Legislature, not of the courts, to determine the economic policy of the State and this Court may not properly declare a statute invalid merely because the Court deems it economically unwise. Mitchell v. Financing Authority, 273 N.C. 137, 144, 159 S.E.2d 745. It is, however, the duty of this Court to declare invalid a statute which forbids one who has lawfully acquired an article of commerce to sell it at a

price satisfactory to himself, unless there is some reasonable basis for the belief that the benefit to the pub

Discussion Notes

1. See also Pennsylvania State Bd. of Pharmacy v. Pastor, 441 Pa. 186, 272 A. 2d 487 (1971).

2. See Note, "Counterrevolution in State Constitutional Law," Stanford Law Review 15 (March 1963): 314:

This judicial revolution has created a real dilemma for the state courts. These courts cannot refuse to enforce state trade regulation which has been enacted for the benefit of particular pressure groups without violating the tenets of a philosophy which bears the endorsement of Holmes, Thayer, Corwin, Hand, and Frankfurter, which has been accepted by the United States Supreme Court, and which is probably regarded as sacred by most of the academic commentators. Yet if the courts enforce such legislation, they will produce results which are pernicious not only for the businessmen whose rights

Department of Insurance v. Dade County Consumer Advocate's Office 492 So. 2d 1032 (Fla. 1986)

OVERTON, Justice.

This appeal... concerns the validity of sections 626.611(11) and 626.9541(1)(h)1, Florida Statutes (1983), which prohibit insurance agents from accepting from their customers a commission lower than the commission set by the insurer. The First District Court of Appeal declared these "anti-rebate statutes" unconstitutional, finding that they are an invalid exercise of the state's police power. We have jurisdiction. Art. V, sec. 3(b)(1), Fla. Const. We find these statutes unnecessarily limit the bargaining power of the consuming public and, in accordance with prior consumer decisions of this Court, we affirm the decision of the district court and hold that these statutes are unconstitutional to the extent they prohibit rebates of insurance agents' commissions.

We are concerned with the narrow issue of whether a statute that prohibits an insurance agent from reducing the amount of the commission he or

lic therefrom outweighs the infringement upon the owner's liberty of contract.

are restricted but also for the public as a
whole.

3. "Developments in the Law-The Interpretation of State Constitutional Rights," Harvard Law Review 95 (April 1982): 1498-99:

Both courts and commentators have largely ignored the possibility that judicial review might play a radically different role-that of safeguarding the interests of majorities. State constitutional law could be dramatically divorced from its federal counterpart if state courts were to reconceive their purpose in terms of elaborating and employing a theory antiof majoritarian, rather than majoritarian, review. In fact, there is reason to believe that state courts already have undertaken something very much like this change of direction in one area: the review of economic regulation.

Read the next case with this in mind.

she will earn from selling the insurance is valid. Historically, this Court has carefully reviewed laws that curtail the economic bargaining power of the public. In fact, this Court was one of the first to hold unconstitutional a "fair trade act" that allowed a manufacturer to establish a minimum retail price for which the retailer could sell a product to the consumer. See Liquor Store v. Continental Distilling Corp., 40 So.2d 371 (Fla. 1949). We found that such legislation is not within the scope of the state's police power and noted that "[c]onstitutional law never sanctions the granting of sovereign power to one group of citizens to be exercised against another unless the general welfare is served." Id. at 374 (emphasis in original). We concluded that the act was arbitrary, unreasonable, and violated the right to own and enjoy property. In Larson v. Lesser, 106 So.2d 188 (Fla. 1958), we struck down as unconstitutional a statute that prohibited a public adjuster who represents insureds from soliciting business on the ground that the restraint imposed was not rationally related to the public's welfare. In Stadnik v. Shell's City, Inc., 140 So.2d 871 (Fla. 1962), this Court held invalid a pharmacy board rule that prohibited the advertisement of the name or price of prescription drugs on the basis that it was an attempt to prohibit price competition which had no reasonable relation to public safety, health, morals or general welfare. In Florida Board of Pharmacy v. Webb's City, Inc., 219 So.2d 681 (Fla. 1969), we held invalid a

statute which prohibited retail drug establishments from using the media to promote the use or sale of prescription drugs.

In considering the validity of a legislative enactment, this Court may overturn an act on due process grounds only when it is clear that it is not in any way designed to promote the people's health, safety or welfare, or that the statute has no reasonable relationship to the statute's avowed purpose.... We find the district court properly found no relationship between the enactments and any legitimate state interest and, therefore, it was not called upon to determine the degree to which the anti-rebate statutes advance a state interest.

From our review of the record, we find no identifiable relationship between the anti-rebate statutes and a legitimate state purpose in safeguarding the public health, safety or general welfare. Insurance agents' commissions do not affect the net insurance premium and are unrelated to the actuarial soundness of insurance policies. The other arguments presented by the Department of Insurance in support of the statutes' constitutionality have been properly responded to by the district court in its opinion. Many of these arguments have been previously unsuccessfully made to uphold statutes or regulations limiting consumers' bargaining power for other services.

BOYD, Chief Justice, dissenting.

Although not explicitly stated, implicit in the Court's holding are the following propositions: that the courts of Florida have broad authority to determine whether acts of the legislature serve the public interest; that courts may generally scrutinize legislation to determine whether it achieves a stated legislative purpose with sufficient success or precision; and that courts may nullify laws not shown to serve the public interest to the courts' satisfaction. These propositions are totally erroneous and their application in this case represents an aggrandizement of judicial power that is antithetical to the basic constitutional doctrine of separation of powers.

There is no allegation that the legislation under attack violates any constitutional rights or penalizes or infringes upon any constitutionally protected liberty. Nor does it establish any suspect classification. It is a regulation of economic activities and relationships. The challenge is purely of the so-called "substantive due process" variety. When faced with such a

challenge, the power of a court to inquire into the validity of a law is severely limited, and rightly so. In order to declare the law invalid, a court must find that the law is simply and absolutely arbitrary, resting on no conceivable rational relation to the public welfare as determined by the legislature. In evaluating legislation under this "reasonable relation" test,

we do not concern ourselves with the wisdom of the Legislature in choosing the means to be used, or even whether the means chosen will in fact accomplish the intended goals; our only concern is with the constitutionality of the means chosen.

[Courts should presume] the existence of circumstances supporting the validity of the Legislature's action, in the absence of any evidence to the contrary. Lasky v. State Farm Insurance Co., 296 So.2d 9, 15-16, 17 (Fla.1974).

Nothing in the majority opinion or the respondents' brief provides any authority for the proposition that the constitutional standard for validity of legislation under the due process clause of article I, section 9, Florida Constitution, is any different from that embodied in the due process clause of the United States Constitution and made binding on the states by the fourteenth amendment. If the Florida Constitution gives the Florida courts the power to invalidate legislation on the ground of lack of political, economic, or social wisdom, this Court should explicitly so hold.

The plenary power to adopt regulatory policy in the interest of the public welfare lies with the legislature. The legislature, in other words, makes law. Courts, in performing their function of adjudicating cases and controversies within their jurisdictions, interpret and apply the law when there is a dispute or conflict regarding how it applies. In the course of performing this function and exercising the authority to apply law and decide cases, courts may ignore or decline to apply laws that violate constitutional rights when challenged by a person suffering an injury from such violation. But courts cannot make law on matters upon which the legislature has spoken when no constitutional violation appears.

The legislature is composed of elected representatives of the people. When standing for election to the legislature, candidates may and should express their views on policy questions. Thus after being

elected, such representatives express the desires of their constituents when they propose and vote upon legislation. Judges, on the other hand, are chosen for office, whether by election or appointment, and retained in office, primarily on the strength of their legal skill, their personal integrity, their promise and undertaking to apply the law fairly and impartially, or some combination of these and similar factors as perceived by the electors or the appointing authority. Judges normally do not campaign for election or apply for appointment on the basis of their personal views on policy questions and such personal views should have no bearing on their performance of their judicial duties. If a regulation adopted by the legislature does not serve the public interest, or achieves a purpose not desire [sic] by the public, the forum in which persons desiring to change the law should seek relief is the legislature. Policy questions are essentially political questions and must be left, under our constitutional form of government, to the elected

Discussion Notes

1. Is Chief Justice Boyd correct when he says there is no reason for state due process analysis to be different from federal due process analysis?

2. Could the federalism arguments we saw earlier, pp. 79-80, have any relevance here?

lawmakers. The notion that acts of the legislature are not full-fledged laws until they receive an official judicial imprimatur is completely erroneous.

In the district court of appeal below, the Department of Insurance correctly cited to the many court decisions from all around the country holding that courts must defer to the legislative judgment in matters of regulation of the insurance industry. The district court in its opinion responded: "The precedential value and persuasiveness of these cases are severely limited by the impact of the revolution in consumer's rights which has occurred since the turn of the century." 457 So.2d at 498 (footnote omitted). The great glory of our constitutional system of democratic government is that "revolutions" in social, political, economic, and legal thought can be translated into public policy quite readily through the ballot box. They should not be imposed from above by appointed judges in contravention of the public will.

3. Is the fact that the United States Supreme Court takes a "hands-off" attitude to these questions relevant when they come before state courts?

4. See also Waller v. State Construction Licensing Bd., 250 Ga. 529, 299 S.E.2d 554 (1983).

In 1979 the voters in California approved an initiative to amend the California constitutional provision on due process and equal protection to read as follows:

California Constitution, Art. I, sec. 7. Due process and equal protection; pupil school assignment or transportation privileges and immunities

(a) A person may not be deprived of life, liberty, or property without due process of law or denied equal protection of the laws; provided, that nothing contained herein or elsewhere in this Constitution imposes upon the State of California or any public entity, board, or official any obligations or responsibilities which exceed those imposed by the Equal Protection Clause of the 14th Amendment to the United States Constitution with respect to the use of pupil school assignment or pupil transportation. In enforcing this subdivision or any other provision of this Constitution, no court of this state may impose upon the State of California or any public entity, board, or official any obligation or responsibility with respect to the use of pupil school assignment or pupil transportation, (1) except to remedy a specific violation by such party that would also constitute a violation of the Equal Protection Clause of the 14th Amendment to the United States Constitution, and (2) unless a federal court would be permitted under federal decisional law to impose that obligation or responsibility upon such party to remedy the specific violation of the Equal Protection Clause of the 14th Amendment of the United States Constitution.

Except as may be precluded by the Constitution of the United States, every existing judgment, decree, writ, or other order of a court of this state, whenever rendered, which includes provision regarding pupil school assignment or pupil transportation, or which requires a plan including any such provisions shall, upon application to a court having jurisdiction by any interested person, be modified to conform to the provisions of this subdivision as amended, as applied to the facts which exist at the time of such modification.

In all actions or proceedings arising under or seeking application of the amendments to this subdivision proposed by the Legislature at its 1979-80 Regular Session, all courts, wherein such actions or proceedings are or may hereafter be pending, shall give such actions or proceedings first precedence over all other civil actions therein.

Nothing herein shall prohibit the governing board of a school district from voluntarily continuing or commencing a school integration plan after the effective date of this subdivision as amended.

In amending this subdivision, the Legislature and people of the State of California find and declare that this amendment is necessary to serve compelling public interests, including those of making the most effective use of the limited financial resources now and prospectively available to support public education, maximizing the educational opportunities and protecting the health and safety of all public school pupils, enhancing the ability of parents to participate in the education process, preserving harmony and tranquillity in this state and its public schools, preventing the waste of scarce fuel resources, and protecting the environment.