Kirby v. Alcoholic Beverage Control Appeals Bd.
| Decision Date | 02 August 1968 |
| Citation | 70 Cal.Rptr. 683 |
| Court | California Court of Appeals Court of Appeals |
| Parties | Edward J. KIRBY, Director of the Department of Alcoholic Beverage Control of the State of California, Petitioner, v. ALCOHOLIC BEVERAGE CONTROL APPEALS BOARD of the State of California and Richard Corsetti, Respondents. Civ. 25168. |
Thomas C. Lynch, Atty. Gen. of State of California, L. Stephen Porter, Deputy Atty. Gen., San Francisco, for petitioner.
Leo K. Gallant, Senior Counsel, Alcoholic Beverage Control Appeals Board, Sacramento, for respondent Appeals Board.
J. Bruce Fratis, San Francisco, for respondent Rechard Corsetti.
This is a review of the decision of the Alcoholic Beverage Control Appeals Board following the issuance of a writ of review upon the application of the Department of Alcoholic Beverage Control (Bus. & Prof.Code, § 23090 et seq.).
On November 23, 1966, an accusation was filed by the Department of Alcoholic Beverage Control (hereinafter referred to as 'Department') against the retail offsale general license of Richard Corsetti (hereinafter referred to as 'licensee'), doing business as 'Dick's Fine Foods.' The accusation alleged that the licensee made retail sales of distilled spirits on September 27, 1966, at prices less than those listed in the minimum Retail Price Schedule duly filed with the Department, in violation of Business and Professions Code section 24755 and California Administrative Code, Title IV, Rule 99(a).
Following a hearing before a hearing officer of the Office of Administrative Procedure, a proposed decision was issued finding the allegations of the accusation to be true and recommending suspension of licensee's alcoholic beverage license for fifteen days. The Department rejected the proposed decision of the hearing officer and independently decided the case pursuant to Government Code section 11517, subdivision (c). The decision of the Department, which issued on April 19, 1967, incorporated by reference the findings of fact and determination of the issues appearing in the hearing officer's proposed decision and ordered revocation of the license.
An appeal with respondent Alcoholic Beverage Control Appeals Board (hereinafter referred to as 'Appeals Board') was filed by the licensee on May 9, 1967. The decision of the Appeals Board, issued on July 12, 1967, reversed the decision of the Department. The Appeals Board found that the evidence in the record failed to establish publication of the minimum price schedule in compliance with the requirements of Business and Professions Code section 24755. 1
This review presents three questions: (1) Whether the publication of the minimum retail price schedule in a trade journal of general circulation in the licensee's trade area, pursuant to california Administrative Code, Title IV, Rule 99(a), satisfies the publication requirements of section 24755; (2) whether rule 99(a) and section 24755 are constitutionally valid; and (3) whether section 24755.1, precluding revocation of the licensee's alcoholic beverage license for violation of section 24755, is constitutionally valid.
The first two questions were recently answered by this court in Reimel v. Alcoholic Bev., etc., Appeals Bd. (1967) 256 A.C.A. 188, 197-204, 64 Cal.Rptr. 26, wherein we held that the subject mode of publication is proper and that rule 99 and section 24755 are constitutionally valid. 2 With respect to the question of the publication requirement, we note that the Appeals Board determined that the evidence in the present record failed to establish that there had been a proper publication of the minimum prices involved in the transaction which was the subject of these proceedings. This determination, however, was based on prior decisions of the Appeals Board holding that, as a matter of law, the publication of the minimum retail prices for distilled spirits in a trade journal in general circulation in the trading area affected does not meet the statutory requirements. These decisions were before us in Reimel, supra. Accordingly, since the factual background with respect to publication is the same in the present case as in Reimel, supra, the parties have treated the question as one of law involving statutory interpretation. The question being one of law, we do not concern ourselves with the substantiality of the evidence, but hold that the publication is sufficient as a matter of law under our holding in Reimel, supra.
We now turn to the remaining question involving the constitutionality of section 24755.1, which purports to limit the Department to monetary penalties for the subject violations. Although reversal on the publication issue precluded consideration by the Appeals Board of the applicability of section 24755.1, the parties have stipulated that we may consider and determine the issue of the constitutionality of section 24755.1.
Section 24755.1, effective September 17, 1965, provides that violations of section 24755, which prohibits the retail sale of alcoholic beverages at less than the price contained in minimum retail price schedules filed with the Department, shall be punished solely by monetary penalties, specifically providing that no criminal penalties shall be imposed and that no license shall be suspended or revoked for a violation of such section. 3
The determination of the instant constitutional question depends upon the interpretation and meaning of article XX, section 22, of the California Constitution which, in relevant part, provides:
In Wilke & Holzheiser, Inc. v. Dept. of Alcoholic Bev. Control, 65 Cal.2d 349, 369-371, 55 Cal.Rptr. 23, 420 P.2d 735, the question of the constitutionality of section 24755.1 was presented, but was not reached. The Supreme Court held that section 24755.1 did not apply retroactively to offenses which occurred before its effective date. (See also Reimel v. Alcoholic Bev. etc. Appeals Bd., supra, 256 A.C.A. 188, 205-206, 64 Cal.Rptr. 26.) The Supreme Court did recognize, however, that determination of the constitutionality of section 24755.1 would require determination of two questions: 'first, whether that section constitutes an invalid limitation upon the power vested in the department by article XX insofar as it eliminates the department's discretionary power to suspend or revoke a license for violation of the retail price maintenance provisions; and, second, whether that section constitutes an invalid extension of the power vested in the department by article XX insofar as it adds the power to impose mandatory fines for violation of the retail price maintenance provisions.' (P. 371, 55 Cal.Rptr. p. 38, 420 P.2d p. 750.) In Wilke, it was noted, moreover, that 'the provisions of section 24755.1 are clearly inseverable, and if we were to decide that article XX invalidates the provision requiring the department to impose fines, then we should be compelled to conclude, as a matter of legislative interpretation, that all of section 24755.1, including its prohibition against license suspension or revocation, is inoperative.' (Fn. 18, p. 371, 55 Cal.Rptr. p. 38, 420 P.2d p. 750.)
Section 22 of article XX of the California Constitution 4 grants to the State of California the exclusive right and power, subject to certain federal laws, to license and regulate the manufacture, sale, purchase, possession and transportation of alcoholic beverages within the state. Under that section the Legislature is empowered to enact laws which implement and are not inconsistent with its provisions. (See Vinnicombe v. State of California, 172 Cal.App.2d 54, 57-58, 341 P.2d 705.) It must be noted, however, that section 22 also creates the Department of Alcoholic Beverage Control and gives to that department certain specified powers, which fall into two categories. The first deals with the Department's licensing and fee collecting powers; the second, with the Department's right to deny, suspend or revoke licenses.
The power of the Department to license and collect fees is designated in section 22 as an 'exclusive power' which must be exercised as provided in that section and 'in accordance with laws enacted by the Legislature.' This proviso, however, does not appear in the language delineating the power of the Department to deny, suspend or revoke licenses. This latter power, however, is not designated in section 22 as an exclusive power. Moreover, it is limited in its exercise to the denial, suspending or revoking of licenses when the Department determines for good cause that the granting or continuance of a license would be contrary to public welfare of morals, or that a person seeking or holding a license has violated any law prohibiting conduct involving moral turpitude.
The language in section 22 that 'The department shall have the power, in its discretion, to * * * suspend or revoke any * * * license if it shall determine for good cause that the * * *...
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