Roller v. Allen
245 N.C. 516, 1957 N.C. LEXIS 621, 96 S.E.2d 851 (1957)
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Rule of Law:
A state cannot, under the guise of its police power, impose licensing requirements on an ordinary and harmless occupation when the regulation lacks a substantial relationship to public health, safety, morals, or welfare and primarily serves to create a monopoly for those already in the business.
Facts:
- North Carolina enacted a law (Chapter 87, Article 3) creating a licensing board and requiring a license for any person or firm that installs ceramic tile, marble, or terrazzo for profit.
- The licensing board was composed entirely of five members who each had at least five years of experience in tile contracting.
- To obtain a license, an applicant needed at least two years of experience and was required to pass an examination.
- The plaintiff, who engaged in tile contracting, attempted but failed to pass the licensing examination.
- As a result of not having a license, general contractors, architects, and engineers refused to consider the plaintiff's bids for work, fearing prosecution under the statute which made it a misdemeanor to consider a bid from an unlicensed contractor.
- The statute exempted all contracts under $150 and all work performed in state colleges, hospitals, and other state buildings, regardless of cost.
Procedural Posture:
- The plaintiff filed a suit in the Superior Court of Richmond County (a trial court) to enjoin the North Carolina Licensing Board for Tile Contractors from enforcing the licensing statute.
- The plaintiff argued that the licensing statute was unconstitutional.
- The trial court found the statute was a necessary and reasonable exercise of state power to protect the public and promote public health.
- The trial court entered a judgment against the plaintiff, concluding that the law was constitutional.
- The plaintiff appealed the trial court's judgment to the Supreme Court of North Carolina.
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Issue:
Does a North Carolina statute requiring a license for tile, marble, and terrazzo contractors violate the North Carolina Constitution's guarantees of the right to earn a livelihood when the occupation does not pose a substantial threat to public health, safety, or welfare?
Opinions:
Majority - Higgins, J.
Yes, the statute violates the North Carolina Constitution. The right to work and earn a livelihood is a fundamental property right that cannot be taken away except through a valid exercise of the state's police power in the paramount public interest for reasons of health, safety, morals, or public welfare. The court found that tile contracting is an ordinary, harmless occupation, not a highly skilled or dangerous one requiring state regulation. The state's justifications for the law—protecting public health and preventing fraud—were not persuasive. The health rationale was undermined by the statute's exemptions for small contracts and all state building projects, and the Board of Health had no role in the licensing process. The argument for fraud prevention was rejected on the grounds that fraud can occur in any occupation and that free competition is a better safeguard for the public. The court concluded that the statute's main purpose was not public protection but to create a monopoly by allowing industry insiders on the licensing board to control who could enter the trade. Therefore, the Act unreasonably obstructs the right to pursue a common occupation and is void.
Analysis:
This decision represents a significant judicial check on the state's police power to regulate economic activity. It establishes that courts will scrutinize licensing schemes, particularly those controlled by industry insiders, to ensure they serve a legitimate public purpose rather than acting as a form of economic protectionism. The case reinforces the principle that the right to earn a living in an ordinary occupation is a fundamental right protected by the state constitution. This precedent makes it more difficult for legislatures to enact laws that create barriers to entry in common trades under the guise of public protection, thereby promoting free competition.
