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Public Regulation

The business of keeping a hotel is closely related to the health and welfare of the public and is regarded as a thing affected with a public interest[i].  When an owner devotes private property to the public use s/he so devotes it bound with notice that it will be subject to public regulation, both as to its use and as to the compensation to be paid for it.

Thus, where property is devoted to the business of a hotel and is held out to the public as a place where transient persons will be received and entertained as guests for compensation, it is affected with a public interest and the business and use are subject to reasonable public regulation.

The administration of public health activities in the U.S. is primarily vested in the individual states[ii].  Further, the authority to regulate the conduct of a business comes from a branch of the police power[iii].

The regulation of hotels is a matter which is concerned with the health, morals, and welfare of the public, and is therefore within the police power of a state, and where there are statutes providing for such regulation, one who conducts such an establishment accepts the duty of fulfilling the obligations imposed by the statutes[iv].  However, the regulations, to be valid, must be reasonable and not calculated to discriminate arbitrarily against particular classes or individuals.

The power to regulate is commonly but not always, committed to local bodies such as municipal corporations; and whether or not the power has been so committed in a particular case depends on the interpretation of the governing statute.  The authority of a municipality to adopt an ordinance may be derived from a single grant or a combination of enumerated powers[v]. Thus, the states and municipalities may make all reasonable, necessary and appropriate provisions to promote the health, morals, peace and welfare of the community[vi].  But neither the state nor a municipality may make any regulations which are unreasonable.

The regulations adopted by the states and municipalities:

  • must be suitable to the end in view,
  • must be impartial in operation and not unduly oppressive upon individuals,
  • must have a real and substantial relation to their purpose, and
  • must not interfere with private rights beyond the necessities of the situation.

The power to regulate hotels or similar establishments may be delegated to administrative agencies, such as a state board of health.  But a hotel is not a public utility so as to be subject to regulation by a public utilities commission.

The violation of statutes or ordinances regulating the hotel or similar business may be a criminal offense.

The power to regulate includes the power to license[vii].  A license is generally required to operate an inn or hotel, a motel, a boarding house, or a restaurant.

A legislature may classify hotels, motels, boarding or rooming houses, restaurants, or similar places, on a reasonable basis for the purpose of licensing or for the purpose of imposing license fees or taxes.  A classification for the purpose of licensing will be upheld by the courts unless it is unreasonable, arbitrary or discriminatory[viii].

The power of a municipality to require a license must be expressly conferred by its charter or by statute, or be a necessary incident to fulfilling the powers granted[ix].

Further, the conferring by the legislature, in general terms, of the power to grant or refuse licenses, in the discretion of the municipal council, without prescribing the bounds of such discretion, will not ipso facto render the grant of power void as being an effort to confer arbitrary power, but will be treated as authorizing the municipal authorities to exercise a reasonable discretion in the grant or refusal of such licenses[x].

A municipal ordinance prohibiting the operation of establishments dispensing food and drink to the public in residential areas during certain early morning hours which sought to reduce noise and maintain order was a reasonable exercise of the police power[xi].

Also, the statute authorizing the police officers of towns to make regulations for determining the time of night at which restaurants should be closed was held valid[xii].  The power of the legislature to provide for inspection of premises in the interest of public safety and the public health is well established[xiii].  The right of inspection is incidental to the police power.

When the legislative department of a city has exercised its power of regulation upon a subject within the police power, the courts will not declare the regulatory provisions void[xiv].

Under the police power license fees may not be imposed wholly for the purpose of obtaining revenue, but a license fee that will legitimately assist in the regulation of the business may be exacted, and it is not essential that it be confined to the exact expense of issuing a license and regulating and inspecting the business.

An act governing the manner is which hotels advertise their rates is a species of social legislation, that is, a field in which the legislative power is supreme unless some specific provision of organic law is transgressed[xv].  Absent such transgression it is for the legislature and not the courts to determine what is unnecessary, unreasonable, arbitrary and capricious.

Requiring hotels, motels, and other rooming houses to advertise full details of room charges if they exercise that medium is certainly a legislative prerogative with which the courts have no power to interfere.  A legislative finding that such a requirement is in the public interest concludes the matter.

Statutes and ordinances regulating the solicitation of patronage for hotels are a valid exercise of the police power.  Also, it is reasonable to require that hotels maintain guest registration records, so they may be inspected by the police.

Similarly, regulations requiring that proprietors of hotels, motels, boarding houses, or similar establishments provide designated safeguards to protect their occupants from fire are valid exercises of the police power.

[i] State v. Norval Hotel Co., 103 Ohio St. 361 (Ohio 1921).

[ii] Daniels v. Portland, 124 Ore. 677 (Or. 1928).

[iii] Tyson & Brother–United Theatre Ticket Offices, Inc. v. Banton, 273 U.S. 418 (U.S. 1927).

[iv] King V. City Of Tulsa, 1966 OK CR 89 (Okla. Crim. App. 1966).

[v] Chicago v. R. & X. Restaurant, Inc., 369 Ill. 65 (Ill. 1938).

[vi] State v. Norval Hotel Co., 103 Ohio St. 361 (Ohio 1921).

[vii] Chicago v. R. & X. Restaurant, Inc., 369 Ill. 65 (Ill. 1938).

[viii] Gilman v. Newark, 73 N.J. Super. 562 (Law Div. 1962).

[ix] Ft. Smith v. Gunter, 106 Ark. 371 (Ark. 1913).

[x] Cutsinger v. Atlanta, 142 Ga. 555 (Ga. 1914).

[xi] Burlington v. Jay Lee, Inc., 130 Vt. 212 (Vt. 1972).

[xii] State v. Grant, 107 N.H. 1 (N.H. 1966).

[xiii] Hubbell v. Higgins, 148 Iowa 36 (Iowa 1910).

[xiv] Chicago v. R. & X. Restaurant, Inc., 369 Ill. 65 (Ill. 1938).

[xv] Nugent v. Florida Hotel & Restaurant Com., 147 So. 2d 606 (Fla. Dist. Ct. App. 2d Dist. 1962).

Inside Public Regulation