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The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us)



Opinion No. 5970

September 1, 1981


Payment of deposit on returnable container

Before a customer may remove a nonalcoholic beverage in a returnable container from the premises of a dealer, a deposit for the returnable container must be paid to the dealer, either by the customer or by another person such as a distributor of the nonalcoholic beverage.

Honorable Frank V. Wierzbicki

State Representative

The Capitol

Lansing, Michigan

You have inquired whether a dealer selling nonalcoholic beverages, as defined in the Initiated Measure of November 2, 1976, would be required to obtain a deposit on a 'returnable container' to be removed from the premises, even though the dealer will comply with the requirement to pay a refund on presentation of an empty container.

1976 PA Initiated Law; MCLA 445.571 et seq; MSA 18.1206(11) et seq, Sec. 1(c), provides:

"Returnable container' means a beverage container upon which a deposit of at least 10 cents has been paid, or is required to be paid upon the removal of the container from the sale or consumption area, and for which a refund of at least 10 cents in cash is payable by every dealer or distributor in this state of that beverage in beverage containers, as further provided in section 2. . . .' [Emphasis added.]

It is to be noted that, as above emphasized, 'returnable container' is defined as a beverage container upon which a deposit of at least 10 cents has been paid or is required to be paid upon removal and there is an additional requirement of a refund payable of at least 10 cents. 1976 PA Initiated Law, supra, does not contemplate that 'returnable containers' be sold and removed from the premises without the payment of the deposit upon such removal from the 'sale or consumption area.'

You have also requested my opinion whether a distributor of nonalcoholic beverages covered under 1976 PA Initiated Law, supra, as part of a promotional program, may advertise that for a limited time, the distributor will pay the not less than 10 cent deposit for the purchaser and that the person returning the container will receive the 10 cent or more deposit refund.

This inquiry differs from that above answered in that there would be the actual payment receipt of the deposit on behalf of the customer upon removal of the beverage from the premises of the dealer.

1976 PA Initiated Law, Sec. 1(1), supra, provides:

'(1) 'Sale or consumption area' means the premises within the property of the dealer or of his lessor where the sale is made, within which beverages in returnable containers may be consumed without payment of a deposit, and, upon removing a beverage container from which, the customer is required by the dealer to pay the deposit.'

The above definition reinforces the conclusion that there must be a payment of deposit upon removal from the premises of a dealer. If for promotional purposes the distributor actually pays to the dealer, in advance, the deposit for the customer, then there would appear to be no violation of 1976 PA Initiated Law, supra, and there would remain the same incentive for the customer to return the container for the appropriate refund regardless of the fact that the deposit was paid on his or her behalf, thus fulfilling the purpose of the 1976 PA Initiated Law, supra.

Inasmuch as a similar promotion scheme of paying the deposit on beer or other malt beverage containers for a customer to the dealer may be considered as a form of 'aid and assistance' to the dealer, it may be barred under the Liquor Control Act, 1933 Ex Sess PA 8, Sec. 31(1); MCLA 436.31; MSA 18.1002, which in pertinent part, provides:

'(1) A manufacturer, warehouseman, wholesaler, outstate seller of beer, outstate seller of wine, or vendor of spirits shall not have any financial interest, directly or indirectly, in the establishment, maintenance, operation, or promotion of the business of any other vendor.'

Therefore, this opinion is limited in application to returnable containers for nonalcoholic beverages.

In summary, it is my opinion that in view of the specific requirements for at least a 10 cent deposit to be made on the sale of 'returnable containers' for nonalcoholic beverages and the lack of any language in the remainder of 1976 PA Initiated Law, supra, authorizing a sale without requiring a deposit, it must be concluded that the dealer must require a deposit for any 'returnable containers' removed from the 'sale or consumption area' as defined. However, if the deposit is paid on behalf of the customer by another party, such as the distributor but excluding the dealer, the payment of such deposit would be permissible as long as the proper refund is paid to the person returning the returnable containers.

Frank J. Kelley

Attorney General

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