92-07 Restaurant, Inc. v. New York State Liquor Authority

• Decision Date: 17 February 1981
• Citation: 435 N.Y.S.2d 989,80 A.D.2d 603
• Parties: 92-07 RESTAURANT, INC., Petitioner, v. NEW YORK STATE LIQUOR AUTHORITY, Respondent.
• Court: New York Supreme Court — Appellate Division

Page 989

435 N.Y.S.2d 989

80 A.D.2d 603

92-07 RESTAURANT, INC., Petitioner, v. NEW YORK STATE LIQUOR AUTHORITY, Respondent.

Supreme Court, Appellate Division, Second Department.

Feb. 17, 1981.

Joseph O. Giaimo, Forest Hills, for petitioner.

Warren B. Pesetsky, New York City (Stanley Stein, New York City, of counsel), for respondent.

Before MOLLEN, P. J., and HOPKINS, TITONE, LAZER and COHALAN, Jr., JJ.

MEMORANDUM BY THE COURT.

Proceeding pursuant to CPLR article 78, inter alia, to review a determination of the State Liquor Authority, dated April 27, 1979, which, after a hearing, suspended petitioner's special on-premises liquor license for a period of 30 days, and ordered the forfeiture of its bond in the sum of $1,000.

Proceeding, insofar as it challenges the constitutionality of subdivisions (r) (par. (2)) and (s) of 9 NYCRR 53.1, is converted into an action for a declaratory judgment, it is declared that subdivision (r) (par. (2)) of 9 NYCRR 53.1 is constitutional, and subdivision (s) of 9 NYCRR 53.1 is unconstitutional and said subdivision is directed to be severed from said regulation.

Determination modified, on the law, by (1) annulling the third numbered finding and (2) deleting the penalty imposed. As so modified, determination confirmed, without costs or disbursements, petition otherwise dismissed on the merits, and matter remitted to the State Liquor Authority for reconsideration of the penalty.

The State Liquor Authority charged the petitioner with the following violations:

"1. That the licensee violated Section 106, subd. 6 of the Alcoholic Beverage Control Law in that it suffered or permitted the licensed premises to become disorderly on October 14, 1977 by suffering or permitting a lewd and indecent performance.

"2. That the licensee suffered or permitted a female to appear on October 14, 1977 in such manner as to expose to view her pubic hair, anus, vulva or genitals; all cause for revocation, cancellation, or suspension of its license in accordance with Rule 36, subd. 1 (r) of the Rules of the State Liquor Authority (9 NYCRR 53.1 (r)).

"3. That the licensee suffered or permitted females to appear on October 14, 1977 and to expose to view their bare breasts from a stage within six feet of the nearest patron; all cause for revocation, cancellation, or suspension of its license in accordance with Rule 36, subd. 1 (s) of the Rules of the State Liquor Authority (9 NYCRR 53.1 (s))."

A hearing was held on the charges and, ultimately, the Authority adopted the findings of its hearing officer that each of the charges had been sustained and that the performance which formed the basis for the first specification had been lewd and indecent per se. Petitioner's license was suspended for 30 days and its $1,000 bond was forfeited. In this article 78 proceeding, the petitioner seeks to have that determination annulled, inter alia, on the ground that the evidence was insufficient to sustain the first specification and that the regulations underlying the second and third specifications are unconstitutional.

On the question of the sufficiency of the evidence adduced in support of the first specification, we find that the charge was clearly sustained. The Authority found that the petitioner suffered or permitted disorderly conduct at its premises by reason of the fact that a nude dancer engaged in acts which were lewd and indecent per se. Our review of the record establishes that the nude dancing in issue was embellished by clearly lewd and indecent acts (cf. Matter of TJPC Rest. Corp. v. State Liq. Auth., 61 A.D.2d 441, 402 N.Y.S.2d 483, affd. 48 N.Y.2d 884, 424 N.Y.S.2d 896, 400 N.E.2d 1348; Matter of Beal Props. v. State Liq. Auth., 45 A.D.2d 906, 907, 358 N.Y.S.2d 566 (partial dissenting mem. of COOKE, J.), revd. 37 N.Y.2d 861, 378 N.Y.S.2d 43, 340 N.E.2d 476). The question of disorderliness is factual (see Matter of Peanutbutter Jam v. New York State Liq. Auth., 58 A.D.2d 703, 396 N.Y.S.2d 703, Matter of Show Boat of New Lebanon v. State Liq. Auth., 33 A.D.2d 954, 306 N.Y.S.2d 859, affd. 27 N.Y.2d 676, 314 N.Y.S. 2, 262 N.E.2d 211), and the hearing examiner resolved the pertinent credibility issues in favor of the Authority's investigators. In our view, then the record contains substantial evidence to support the Authority's conclusion that the premises became disorderly by reason of a performance that was lewd and indecent, and that the conduct engaged in was lewd and indecent per se (see Matter of Salem Inn v. New York State Liq. Auth., 43 N.Y.2d 713, 401 N.Y.S.2d 205, 372 N.E.2d 40; Matter of Bell v. State Liq. Auth., 62 A.D.2d 1066, 403 N.Y.S.2d 804, mot. for lv. to app. den. 44 N.Y.2d 647, 407 N.Y.S.2d 1026, 379 N.E.2d 227, app. dsmd. 439 U.S. 1060, 99 S.Ct. 822, 59 L.Ed.2d 26; Matter of Inside Straight v. State Liq. Auth., 56 A.D.2d 720, 392 N.Y.S.2d 770, mot. for lv. to app. den. 41 N.Y.2d 806, 396 N.Y.S.2d 1025, 364 N.E.2d 850; Matter of Rubinoff v. State Liq. Auth., 53 A.D.2d 943, 385 N.Y.S.2d 212, mot. for lv. to app. den. 40 N.Y.2d 802, 387 N.Y.S.2d 1028, 356 N.E.2d 293). Accordingly, the Authority's determination as to the first specification should remain undisturbed.

Petitioner's attack upon the second and third findings is based upon the contention that subdivisions (r) (par. (2)) and (s) of 9 NYCRR 53.1 are facially invalid in that they are unconstitutionally overbroad. At the outset, we note that, insofar as the issue thus raised by the petitioner requires us to pass upon the constitutionality of the regulations themselves as opposed to the action taken under them, this article 78 proceeding must be converted to an action for a declaratory judgment (see, e. g., Matter of Kovarsky v. Housing & Development Admin. of City of N. Y., 31 N.Y.2d 184, 335 N.Y.S.2d 383, 286 N.E.2d 882; Matter of Gold v. Lomenzo, 29 N.Y.2d 468, 476, n.4, 329 N.Y.S.2d 805, 280 N.E.2d 640; Matter of Overhill Bldg. Co. v. Delany, 28 N.Y.2d 449, 322 N.Y.S. 696, 271 N.E.2d 537).

The regulations in question provide as follows:

"53.1 Causes for revocation

"Any license or permit issued pursuant to the Alcoholic Beverage Control Law may be revoked, cancelled or suspended for the following causes:

"(r) For suffering or permitting on licensed premises

"(2) any person to appear unclothed or in such manner or attire as to expose to view any portion of the pubic hair, anus, vulva or genitals, or any simulation thereof.

"(s) For suffering or permitting any female to appear on licensed premises in such manner or attire as to expose to view any portion of the breast below the top of the areola, or any simulation thereof."

The petitioner's challenge to the constitutionality of subdivision (s) is easily resolved since the Court of Appeals has recently declared unconstitutional so much of subdivision 6-a of section 106 of the Alcoholic Beverage Control Law as prohibited topless dancing in licensed premises (Bellanca v. New York State Liq. Auth., 50 N.Y.2d 524, 429 N.Y.S.2d 616, 407 N.E.2d 460). The subdivision struck down in Bellanca is the statutory counterpart of subdivision (s) of 9 NYCRR 53.1 and the two provisions contain identical language. As a consequence, we must now declare the regulation to be unconstitutional and annul the Authority's determination as to the third specification, which was predicated upon a violation of subdivision (s).

The remaining issue is whether the Bellanca holding requires that subdivision (r) (par. (2)) of 9 NYCRR 53.1 be declared unconstitutional as well. We hold that it does not.

In Bellanca, the Court of Appeals viewed the issue presented as a narrow one. As the court observed (p. 529, 429 N.Y.S.2d 616, 407 N.E.2d 460):

"In the case now before us the plaintiffs do not claim a right to offer performances of explicit sexual acts, live or filmed, real or simulated. Nor are we concerned with nude dancing. There is no contention that the plaintiffs should have a right to present their dancers entirely unclothed, and thus they do not challenge that portion of the statute which prohibits nudity. Nor do they contest the statute insofar as it would prohibit women other than dancers from appearing bare-breasted on their premises. Similarly the plaintiffs do not contest the State's right to place some restrictions on topless dancing performances as the Liquor Authority's regulations have done in the past. Finally, of course, the plaintiffs do not claim that they are exempted from the obscenity laws or that topless dancing should always be allowed no matter how, or where performed. The only question before us is whether the statute is constitutional to the extent that it absolutely prohibits liquor licensees from presenting nonobscene topless dancing performances to willing customers under all circumstances."

In striking down the prohibition, the court distinguished California v. La Rue, 409 U.S. 109, 92 S.Ct. 559, 30 L.Ed.2d 551, noting that, unlike in that case, there was nothing in the Bellanca record "to show that the State's conclusion, that this activity should not take place at licensed premises, was rationally based on evidence demonstrating a need for the rule." (Bellanca, supra, 50 N.Y.2d at p. 530, 429 N.Y.S.2d 616, 407 N.E.2d 460.) Plainly, the court's decision to search the record for evidence demonstrating such a need was prompted by the fact that, not long before, the provisions controlling topless performances in licensed premises were changed and made more restrictive.

Prior to 1977, subdivision (s) of 53.1 provided that the licensee should not suffer or permit "any female to appear on licensed premises in such manner or attire as to expose to view any portion of the breast below the top of the areola, or any simulation thereof," with the exception that the prohibition would not apply "to any female entertainer performing on a stage or platform which is at least 18 inches above the immediate floor level and which is removed by at least six feet from the nearest...