Mini Mart, Inc. v. City of Minot

• Decision Date: 21 March 1984
• Docket Number: No. 10515,10515
• Parties: MINI MART, INC., Petitioner and Appellee, v. The CITY OF MINOT, a municipal corporation, and David Badgley, Carl Collins, David Germain, James Hatelid, James Holdman, Ronald Klecker, Dolores Kramer, Edward Kuhn, Neil Leigh, John Pence, and Curtis Zimbelman, individually and as aldermen of the City of Minot, North Dakota, Respondents and Appellants. Civ.
• Court: North Dakota Supreme Court

Page 131

347 N.W.2d 131

MINI MART, INC., Petitioner and Appellee, v. The CITY OF MINOT, a municipal corporation, and David Badgley, Carl Collins, David Germain, James Hatelid, James Holdman, Ronald Klecker, Dolores Kramer, Edward Kuhn, Neil Leigh, John Pence, and Curtis Zimbelman, individually and as aldermen of the City of Minot, North Dakota, Respondents and Appellants.

Civ. No. 10515.

Supreme Court of North Dakota.

March 21, 1984.

Bosard, McCutcheon & Rau, Minot, for petitioner and appellee; argued by Robert S. Rau, Minot. Appearance by Lyle G. Witham, Minot.

Eaton, Van de Streek & Ward, Minot, for respondents and appellants; argued by Nevin Van de Streek, Minot.

ERICKSTAD, Chief Justice.

The City of Minot and eleven of its aldermen (hereinafter collectively referred to as the "City") have appealed from a judgment entered by the District Court of Ward County granting a peremptory writ of mandamus commanding the City to issue a retail beer license to Mini Mart, Inc. We affirm.

On March 7, 1983, Mini Mart applied to the City for a retail beer license for one of its premises where it operates a combination gasoline station and convenience store. Mini Mart filed a completed application for the license which contained all of the information required by the City and its code of ordinances. Two retail beer licenses were available for issuance at that time and Mini Mart was one of two applicants for the licenses. One of the two remaining licenses was subsequently issued to the other applicant. On April 4, 1983, both the City's Liquor/Gambling Control Committee and the City Council voted to deny Mini Mart's application for the remaining license. Mini Mart was the only applicant for that license.

As a result of the denial of the license, Mini Mart petitioned for a writ of mandamus. Mini Mart argued that it had performed all of the acts required of it and that the plan it submitted to the City Council met all the standards and criteria imposed by the City in its code of ordinances in regard to the issuance of a retail beer license. The City admitted that Mini Mart's application complied with all of the sanitation, safety, and health requirements imposed by the City's ordinances, but argued that it had the authority to withhold approval of Mini Mart's application on the basis of unwritten criteria. The City thus urged the trial court to take judicial notice of the demography of the area, the geography, and the public mood respecting driving while under the influence of alcoholic beverages in determining whether or not the City Council abused its discretion in denying Mini Mart's license application.

In a memorandum opinion dated July 27, 1983, the trial court concluded that, although the City Council had statutory discretion in the issuance of liquor licenses, the reservation of discretion must be expressed in an existing ordinance. The court found Sec. 5-28(e) of the Minot Code of Ordinances ¹ to be the only ordinance which allowed the City Council to exercise discretion. The court also concluded that it was "an abuse of discretion not to make a record so the court can determine any arbitrariness or abuse of discretion on the part of the licensing agency." The court thus remanded the matter to the City Council "to determine at its next general council meeting only whether the structure proposed to be used for the retail sale of beer by the petitioner is sufficient for the general welfare and safety of the general public" in accordance with the terms of Sec. 5-28(e). [Emphasis in original.] The court also ordered that the City's findings on that issue be "set out in full and spread upon the records of the city council" so that the court could determine whether or not the action was arbitrary, capricious, or discriminatory.

Extensive minutes were taken at the City Council's meeting on August 1, 1983. Mini Mart's counsel appeared and offered a copy of Mini Mart's original application for the license, which contained the approval signature of the City Building Inspector, and an affidavit of an officer of the construction company engaged by Mini Mart to construct an addition to the premises, stating that the company would construct the facility so that it is "in strict compliance and conformity" with the Minot Code of Ordinances and "is sufficient for the general welfare and safety of the general public."

Two of the City Council members read prepared statements which were concurred in by nine other members of the Council. The prepared statements expressed concerns that the building plans offered by Mini Mart would encourage the use of one employee to oversee the off-sale operation, the grocery sales, and gas sales, and consequently, "supervision of the off-sale portion of the business will be reduced with a realistic assumption that purchases of beer by minors will be made somewhat easier than otherwise would be the case." One of the statements also expressed the view that if the license were granted, Mini Mart would be in violation of Sec. 5-4 of the Minot Code of Ordinances, which makes it an offense to sell items other than those listed in the ordinance in a licensed premises. It was further stated that it would not be "reasonable or prudent to grant a license to an establishment that is frequented and to a large extent has become a hangout for minors." Concerns were also expressed that "it is not wise public policy to have an off-sale beer establishment in close proximity to the campus of Dakota Northwestern University" ² and that "[a]pproving the license for a business to sell both alcohol and gasoline sends the wrong signal to the public." Mini Mart's application was denied on a 10-2 vote.

At the same meeting, the City Council passed a resolution and passed an ordinance on first reading. Both provisions are substantively identical and purport to forbid the granting of a retail liquor license for any premises upon which is located a gasoline station, and also provide additional criteria by which the City Council may judge the suitability of a liquor license applicant. ³

On August 4, 1983, the City moved for leave to amend its pleadings in response to the petition for writ of mandamus to raise an additional defense that Resolution No. 77 explicitly barred the granting of a license to an enterprise such as Mini Mart.

In a memorandum opinion dated August 10, 1983, the district court ruled that Resolution No. 77 was "ineffective for filling the role of being a surrogate law until the ordinance can take over" and declared it a "nullity" in the instant case. The court also stated that it had read the statements of the Council members and found them to be irrelevant to the disposition of the matter, and from the absence in the record of any noted deficiencies of the structure for the welfare and safety of the general public, Mini Mart was entitled to have the beer license issued to them because it had satisfied all of the conditions precedent to being issued a retail beer license under the Minot Code of Ordinances. The City has appealed from the judgment granting the writ of mandamus.

The major issues raised by the City in this case are as follows: (1) whether or not the "record" of the City's hearing on Mini Mart's license application was sufficient for judicial review; (2) whether or not the trial court erred in holding that Resolution No. 77 was a nullity in this case; (3) whether or not the trial court erred in holding that the City Council could not rely upon unwritten ad hoc criteria to deny a liquor license; and (4) whether or not the trial court gave too narrow a construction to the general welfare and safety clause contained in Sec. 5-28(e) of the Minot Code of Ordinances.

Before reaching these questions, we briefly outline the function of this Court when reviewing appeals in mandamus actions.

This Court will not reverse a trial court's issuance or denial of a writ of mandamus unless, as a matter of law, such writ should not issue or unless there is a finding that the trial court has abused its discretion. Eckre v. Public Service Commission 47 N.W.2d 656, 665-666 (N.D.1976). See also Blomquist v. Clague, 290 N.W.2d 235, 237 (N.D.1980); Fargo Ed. Ass'n v. Paulsen, 239 N.W.2d 842, 849 (N.D.1976). A trial court abuses its discretion when it acts in an arbitrary, unreasonable, or unconscionable manner. E.g., Fleck v. Fleck, 337 N.W.2d 786, 789 (N.D.1983). In Midland Produce Co. v. City of Minot, 70 N.D. 256, 257-258, 294 N.W. 192, 193 (1940), this Court stated:

"Mandamus will not lie against a municipal board or officer unless the plaintiff's or relator's legal right to the performance of the particular act sought to be compelled by the writ is clear and complete.... Neither will it lie where there is some other plain, speedy and adequate remedy in the ordinary course of law.... To be enforceable by mandamus, the duty must be one clearly and peremptorily enjoined by law. The law must not only authorize the act, but it must require it to be done...." [Citations omitted.]

See also Eckre, supra, 247 N.W.2d at 666; Fargo Ed. Ass'n, supra, 239 N.W.2d at 844.

With these principles in mind, we proceed to address the issues raised by the parties.

I ADEQUACY OF THE RECORD

In its first memorandum opinion, the district court concluded that the City abused its discretion when it did not make an adequate record of its proceedings. Mini Mart argues that any administrative or quasi-judicial hearing before the City Council is a "hearing" for which an adequate record must be kept for judicial review, citing decisions rendered under the provisions of Chapter 28-32, N.D.C.C., the Administrative Agencies Practice Act. If Mini Mart's argument is that the "record" of the proceedings before the City Council in this case must have consisted of sworn testimony from witnesses and a written transcript of the testimony, we do not agree.

Initially, we note that a municipal government, not being an "administrative...