Louisville/Jefferson v. Tdc Group, No. 2007-SC-000315-DG,

• Decision Date: 19 February 2009
• Docket Number: No. 2007-SC-000581-DG.,No. 2007-SC-000315-DG,
• Citation: 283 S.W.3d 657
• Parties: LOUISVILLE/JEFFERSON COUNTY METRO GOVERNMENT, Appellant/Cross-Appellee, v. TDC GROUP, LLC, d/b/a Molly Malone's, Appellee/Cross-Appellant, and Alcoholic Beverage Control Board, Commonwealth of Kentucky, Appellee.
• Court: United States State Supreme Court — District of Kentucky

283 S.W.3d 657

LOUISVILLE/JEFFERSON COUNTY METRO GOVERNMENT, Appellant/Cross-Appellee, v. TDC GROUP, LLC, d/b/a Molly Malone's, Appellee/Cross-Appellant, and Alcoholic Beverage Control Board, Commonwealth of Kentucky, Appellee.

No. 2007-SC-000315-DG,

No. 2007-SC-000581-DG.

Supreme Court of Kentucky.

February 19, 2009.

Rehearing Denied June 25, 2009.

David A. Sexton, Assistant Jefferson County Attorney, Louisville, KY, Counsel for Appellant/Cross Appellee, Louisville/Jefferson County Metro Government.

Kenneth Sidney Handmaker, Kevin Lee Chlarson Middleton Reutlinger, Louisville, KY, Counsel for Appellee/Cross Appellant, TDC Group, LLC, d/b/a Molly Malone's.

Henry Joseph Curtis, La Tasha Arnae Buckner, Matthew Scott Finley, Office of Alcoholic Beverage Control, Frankfort, KY, Counsel for Appellee, Alcoholic Beverage Control Board, Commonwealth of Kentucky.

Opinion of the Court by Justice NOBLE.

This appeal arises from a challenge by Louisville/Jefferson County Metro Government ("Metro") to a decision of the Alcoholic Beverage Control Board to grant a retail drink license to TDC Group, LLC, d/b/a Molly Malone's ("Molly Malone's"). The issues raised concern KRS 241.075, which prohibits the issuance of a retail drink license to an applicant located in a "combination business and residential area" if another "similar establishment" is located within 700 feet of the applicant. Metro challenges the ABC Board's interpretation and application of the measurement method in KRS 241.075. Molly Malone's has cross-appealed to challenge the constitutionality of the statute on the ground that it constitutes "special legislation" in violation of Sections 59 and 60 of the Kentucky Constitution. The Court of Appeals ruled against the ABC Board on the measurement issue, but ruled in favor of Molly Malone's as to the constitutionality of the statute. The Court of Appeals is hereby affirmed for reasons other than those stated in its opinion.

I. Background

Molly Malone's operates at 933 Baxter Avenue in Louisville, Kentucky, where it serves food and drink to the public. It holds a retail beer license, a restaurant drink license, a limited Sunday license, and three supplemental bar licenses. In September 2004, Molly Malone's applied for a retail liquor drink license to replace its restaurant drink license. The local ABC administrator denied the application, citing inadequate off-street parking and public sentiment against issuance of the license. The administrator also relied on the 700-feet restriction in KRS 241.075. By the administrator's measurement two other retail drink licensees on the other side of Baxter Avenue—Burns & Bielefeld, Inc., d/b/a Wet Willy's, and Outlook Inn, Inc., d/b/a Outlook Inn—were within 700 feet of Molly Malone's. The administrator measured the distance to Wet Willy's as 398 feet by walking in the direction of Wet Willy's from the entrance of Molly Malone's, crossing the street at the nearest intersection (where Morton Avenue ends at Baxter Avenue and which includes no marked crosswalk), and then continuing to the entrance of Wet Willy's. The administrator measured the distance to Outlook Inn as 336 feet by the same method, except the intersection used in that route was where Christy Avenue ends at Baxter Avenue, which also included no marked crosswalk.

Molly Malone's appealed the decision to the ABC Board. The Board held a full adjudicatory hearing at which it heard testimony from William Schreck, the local ABC administrator;¹ Wayne Westerman, a land surveyor and expert for Molly Malone's; Donal Ryan, one of the owners of Molly Malone's; and Charles Weathers, the local ABC investigator who made the under-700-feet measurements. The Board concluded that the lack of parking was not a sufficient reason for denying the license, citing the fact that Molly Malone's had previously been granted a waiver reducing its number of required off-street parking spaces. The Board also found that public sentiment was not enough to deny the license because petitions by members of the public had been presented in favor of and in opposition to the application for the license.

The Board also found that the local administrator had incorrectly measured the distance between Molly Malone's and the other establishments. Specifically, the Board found that KRS 241.075(3)'s requirement that the measurement be taken according to the "shortest route of ordinary pedestrian travel" means a route that is both lawful and safe. The Board rejected the local administrator's measurement, which required crossing in the middle of the block and without a marked crosswalk, which the Board read as violating KRS 189.570(6)(c), and going across a road known for its heavy traffic, which the Board concluded was unsafe. Instead, the Board adopted Molly Malone's proposed measurements, which assumed that a pedestrian would walk to the nearest intersection with a marked crosswalk (located where Highland Avenue crosses Baxter Avenue) and which were over 700 feet for both Wet Willy's and Outlook Inn. The Board concluded that the route through the intersection at Highland Avenue was the shortest safe and legal route of ordinary pedestrian travel.

Based on these findings, the Board ordered that Molly Malone's application be granted. Metro appealed the decision to the Franklin Circuit Court, arguing that the Board incorrectly interpreted KRS 241.075(3). Molly Malone's in turn argued that the statute was unconstitutional because its 700-feet requirement only applied to businesses in certain parts of first-class cities and consolidated local governments and was therefore discriminatory and violated the proscription on special legislation founding Section 59 and 60 of the Kentucky Constitution.

The circuit court affirmed the Board's decision. It held that the Board had interpreted the measurement requirements of the statute correctly and did not reach the issue of the statute's constitutionality.

Metro again appealed, challenging the Board's reading of the statute. Molly Malone's filed a cross-appeal, again seeking to have the statute declared unconstitutional. The Court of Appeals held that the Board had properly read the statute to require both lawful and safe travel, but held that the path followed by the local administrator was neither unlawful nor unsafe. The court went on to address the constitutionality of the statute, holding that it violated the proscription on special legislation found in Sections 59 and 60 of the Kentucky Constitution.

This Court granted Metro's motion for discretionary review and Molly Malone's subsequent cross-motion for discretionary review.

II. Analysis

A. Priority of Issues

Both parties' issues are properly before the Court. However, because both a question of statutory construction and application, and a question of constitutionality are presented, the order in which the issues should be taken up by the Court must first be addressed.

Molly Malone's argues that the constitutionality of the statute must be addressed first because to do otherwise requires application of a potentially unconstitutional statute. In support of this position, Molly Malone's cites D.F. v. Codell, 127 S.W.3d 571, 578 (Ky.2003), which held a statute to be unconstitutional and then declined to address other issues raised in the case because they were moot. Molly Malone's ignores that the other issues in Codell involved other constitutional challenges to the statutory scheme in question.

More importantly, it ignores "the longstanding practice of this Court ... to refrain from reaching constitutional issues when other, non-constitutional grounds can be relied upon." Baker v. Fletcher, 204 S.W.3d 589, 597-98 (Ky.2006); see Dawson v. Birenbaum, 968 S.W.2d 663, 666 (Ky. 1998) ("It is well settled that where a party pleads both statutory and constitutional claims, the court deciding those claims should limit itself to considering the statutory claims if in so doing the court may avoid deciding complex constitutional issues."); Preston v. Clements, 313 Ky. 479, 232 S.W.2d 85, 88 (1950) ("The prevailing rule seems to be that the courts will avoid the question of constitutionality unless necessary to a proper determination of the merits of the cause under consideration."); see also Three Affiliated Tribes of Fort Berthold Reservation v. Wold Engineering, P.C., 467 U.S. 138, 157-58, 104 S.Ct. 2267, 81 L.Ed.2d 113 (1984) ("It is a fundamental rule of judicial restraint, however, that this Court will not reach constitutional questions in advance of the necessity of deciding them."); Spector Motor Service v. McLaughlin, 323 U.S. 101, 105, 65 S.Ct. 152, 89 L.Ed. 101 (1944) ("If there is one doctrine more deeply rooted than any other in the process of constitutional adjudication, it is that we ought not to pass on questions of constitutionality ... unless such adjudication is unavoidable."). This practice of avoiding constitutional questions is further buttressed in this Court's jurisprudence law by the presumption of constitutionality of statutes. Baker, 204 S.W.3d at 598.

Therefore, despite Molly Malone's request, this Court cannot address the constitutionality of the statute without first determining whether the Court of Appeals was correct that it barred issuance of the license.

B. Measuring Distance Under KRS 241.075

The Court of Appeals was correct in upholding the ABC Board's reading of KRS 241.075(3) as requiring that the measurement be taken along a route that is both lawful and safe. This Court has recognized the "deference afforded an administrative agency's construction of a statute that it is charged with implementing," so long as the "agency interpretation is in the form of an adopted regulation or formal adjudication." Board of Trustees of Judicial Form Retirement System v. Attorney General of the Commonwealth, 132 S.W.3d 770, 786-87 (Ky.2003) (citing Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 844-45, 104...