Marting v. Nebraska Liquor Control Com'n

• Decision Date: 31 May 1996
• Docket Number: No. S-94-695,S-94-695
• Citation: 250 Neb. 134,548 N.W.2d 326
• Parties: Faye MARTING and West A Liquor, Inc., a Nebraska corporation, Appellees and Cross-Appellants, and City of Lincoln, Nebraska, a municipal corporation, Appellant and Cross-Appellee, v. NEBRASKA LIQUOR CONTROL COMMISSION et al., Appellees and Cross-Appellees.
• Court: Nebraska Supreme Court

Page 326

548 N.W.2d 326

250 Neb. 134

Faye MARTING and West A Liquor, Inc., a Nebraska corporation, Appellees and Cross-Appellants, and City of Lincoln, Nebraska, a municipal corporation, Appellant and Cross-Appellee, v. NEBRASKA LIQUOR CONTROL COMMISSION et al., Appellees and Cross-Appellees.

No. S-94-695.

Supreme Court of Nebraska.

May 31, 1996.

Syllabus by the Court

1. Administrative Law: Liquor Licenses: Appeal and Error. Under Neb.Rev.Stat. § 53-1,116 (Reissue 1984), review by the Nebraska Supreme Court of decisions of the Nebraska Liquor Control Commission is de novo on the record.

2. Administrative Law: Liquor Licenses: Appeal and Error. Under Neb.Rev.Stat. § 53-1,116(5) (Reissue 1984), the district court may not disturb the decision of the Nebraska Liquor Control Commission unless the decision was arbitrary and unreasonable.

3. Constitutional Law: Statutes. When an amendatory act is invalid, the previous statute on the subject remains in full force and effect.

4. Pleadings. Matters contained in pleadings are judicial admissions only insofar as the adversary is concerned.

5. Evidence. Where evidence is admitted as an admission against interest against one defendant, that evidence is not ordinarily admissible against a codefendant.

William F. Austin, Lincoln City Attorney, and Joel D. Pedersen, Lincoln, for appellant.

William G. Blake, of Pierson, Fitchett, Hunzeker, Blake & Loftis, Lincoln, for appellees Marting and West A Liquor.

J. Michael Rierden, Lincoln, for appellee J Mart.

WHITE, C.J., and CAPORALE, FAHRNBRUCH, LANPHIER, WRIGHT, CONNOLLY, and GERRARD, JJ.

PER CURIAM.

The appellant and local governing body, City of Lincoln, and the appellees and cross-appellants and protestants, West A Liquor, Inc., and Faye Marting, seek review of the judgment of the district court affirming the grant of a liquor license by the appellee Nebraska Liquor Control Commission to the appellee and applicant, J Mart, Inc.

FACTS

On September 23, 1993, J Mart, a convenience store located in the West A Shopping Center at Lincoln, Nebraska, filed an application for a license permitting it to sell beer, and only beer, for consumption off its premises (designated by the Nebraska Liquor Control Act as a class B license). See Neb.Rev.Stat. § 53-124 (Reissue 1993). The city council held public hearings on J Mart's application, at the conclusion of which the city council recommended that the commission deny the application, and passed a five-point resolution, declaring that

1. ... the existing population of the City of Lincoln and the projected population growth of the City of Lincoln and within the area proposed to be served were inadequate to support the proposed license.

2. ... the existing licenses, and the class of such licenses, including one Class "D", within a one-mile radius from the proposed location, were adequately serving the area.

3. ... the license was not compatible with the nature of the neighborhood.

4. ... the applicant had not demonstrated that the issuance of the license is and will be consistent with the public interest.

5. The issuance of the license will not be required by the present or future public convenience and necessity.

The commission then held a public hearing on November 10, 1993, at which J Mart presented evidence that its sole shareholder had extensive experience in the retail liquor industry and had never been cited for a license violation. As proof of the public need and convenience, J Mart presented a petition with 174 signatures in support of its application. In addition, J Mart represented that the license was necessary in order to allow it to compete with other convenience stores in the city.

Protestant Marting, the manager of West A Liquor, which is located approximately 50 feet from J Mart in the same shopping center, stated that traffic flow into the shopping center from the east is congested because of the location of J Mart's gas pump island. Marting also submitted a petition containing 177 signatures opposing J Mart's application and a letter she had written to the city council in which she declared that the shopping center was adequately served by her establishment and Keegan's Pub.

West A Liquor urged the commission to find, based upon the recommendation of the city council and citizen protests, that there was insufficient evidence of public need and convenience. It also disputed J Mart's testimony that this license was necessary to allow J Mart to compete in the convenience store market, as the convenience stores closest to J Mart's location did not possess liquor licenses.

In rebuttal, J Mart submitted letters in support of the application from two other tenants in the shopping center. In addition, it offered an aerial photograph of the shopping center, showing a lack of congestion, and the testimony of an employee, who stated that there was sufficient clearance around J Mart's gas pump island to allow normal vehicle flow into the shopping center. J Mart concluded by introducing evidence that other shopping centers in Lincoln had multiple liquor licenses.

At the conclusion of the hearing, the commission's chairperson, although bemoaning what he characterized as the law stripping "the Commission of the authority to deny liquor licenses on a reasonable basis," nonetheless moved for the approval of J Mart's application. The motion passed unanimously; however, the commission did not enter its written order until December 7, 1993.

The district court affirmed the decision of the commission, concluding that the proceeding before it was controlled by Neb.Rev.Stat. § 53-1,116 (Reissue 1984), which provided, in relevant parts:

(5) Any decision of the commission granting ... a license ... for the sale of alcoholic liquors, including beer, may be reversed, vacated, or modified by the district court of Lancaster County on appeal by any party to the hearing or rehearing before the commission....

....

(8) The appeal, provided for or referred to in [subsection] (5) ... shall be heard and tried by the court without a jury on the record of the commission.

The district court reasoned therefrom that its review was limited to one on the record made before the commission to determine whether the commission's decision was arbitrary and unreasonable. The district court also concluded that the factors to be considered by the commission in determining whether the license should issue were as set forth in Neb.Rev.Stat. § 53-132 (Reissue 1984):

(2) A retail license ... shall be issued to any qualified applicant if it is found by the commission that (a) the applicant is fit, willing, and able to properly provide the service proposed ... (b) the applicant can conform to all provisions, requirements, rules, and regulations provided for in the Nebraska Liquor Control Act, (c) the applicant has demonstrated that ... the licensed premises will be sufficient to insure that the licensed business can conform to all provisions, requirements, rules, and regulations provided for in the Nebraska Liquor Control Act, and (d) the issuance of the license is or will be required by the present or future public convenience and necessity.

(3) In making its determination pursuant to subsection (2) of this section the commission shall consider:

(a) The recommendation of the local governing body;

(b) The existence of a citizens' protest ...;

(c) The existing population of the city, village, or county, as the case may be, and its projected growth;

(d) The nature of the neighborhood or community of the location of the proposed licensed premises;

(e) The existence or absence of other retail licenses or bottle club licenses with similar privileges within the neighborhood or community of the location of the proposed licensed premises;

(f) The existing motor vehicle and pedestrian traffic flow in the vicinity of the proposed licensed premises;

(g) The adequacy of existing law enforcement;

(h) Zoning restrictions;

(i) The sanitation or sanitary conditions on or about the proposed licensed premises; and

(j) Whether the type of business or activity proposed ... is and will be consistent with the public interest.

From the record before the commission, the district court found that because J Mart's sole shareholder had operated other licensed facilities for more than 10 years without a violation, the conditions in § 53-132(2)(a) through (c) were satisfied. The district court discounted the city council's recommendation of denial, finding it to be conclusory, not supported by the record, and inconsistent with the law.

ASSIGNMENTS OF ERROR

The city and protestants assign eight errors to the district court, which combine to assert that the district court erred in applying a wrong standard of review; failing to find that the commission erred in granting the license not only because the commission did not properly consider the appropriate

criteria, but because J Mart did not demonstrate a present or future need; and failing to find that the commission issued the license before entering its order.

STANDARD OF REVIEW

While there is disagreement among the parties as to the appropriate standard of review, all of the parties maintain that it is gleaned from § 53-1,116 (Reissue 1984). In Kwik Shop v. City of Lincoln, 243 Neb. 178, 498 N.W.2d 102 (1993), we ruled that Neb.Rev.Stat. § 53-134 (Cum.Supp.1990), as amended by 1989 Neb. Laws, L.B. 781, was unconstitutional on a variety of grounds, including the vagueness of the criteria a local governing body was to consider in recommending to the commission whether to approve or deny a liquor license. Finding the other provisions of L.B. 781 inseparable, we held that the entire enactment must fail. In addressing our standard of review in that circumstance, we wrote:

We have addressed similar issues in the recent cases of B & R Stores v. Nebraska Liquor Control Comm., 242 Neb. 763, 497 N.W.2d 654 (1993), Hy-Vee Food Stores v. Nebraska Liquor Control Comm....