Perez v. Webb

• Decision Date: 09 February 1976
• Docket Number: No. KCD,KCD
• Citation: 533 S.W.2d 650
• Parties: Antonio V. PEREZ d/b/a Paco's, Respondent, v. W. Yates WEBB et al., Appellants. 27206.
• Court: Missouri Court of Appeals

Page 650

533 S.W.2d 650

Antonio V. PEREZ d/b/a Paco's, Respondent, v. W. Yates WEBB et al., Appellants.

No. KCD 27206.

Missouri Court of Appeals, Kansas City District.

Feb. 9, 1976.

Aaron A. Wilson, City Atty., Rex G. Bostwick, Asst. City Atty., Kansas City, for appellants.

Michael J. Drape, Galen P. Knowlton, Knowlton & Drape, Kansas City, for respondent.

Before SHANGLER, P.J., and SWOFFORD and SOMERVILLE, JJ.

SWOFFORD, Judge.

This is an appeal by W. Yates Webb, Director of Liquor and Amusement Control (hereafter Director) and the members of the Liquor Control Board of Review (hereafter Board) of Kansas City, Missouri, from a judgment of the Circuit Court reversing the decision of the Board and ordering the Director to grant the application of the Respondent for transfer of his liquor permit from one location to another. The Director refused the application to transfer such license; his decision was upheld by the Board (after a full hearing); and, the Respondent thereupon filed a petition in the court below which, while denominated a petition for injunctive relief, was in fact a petition for review under the Administrative Procedure and Review Act (and particularly Section 536.100 et seq. RSMo 1969). It was so treated by the court and the parties below and these proceedings will be so reviewed here.

More specifically, antonio V. Perez (hereafter Respondent) held a valid license to sell liquor by the drink and in package at 4343 Troost Avenue, Kansas City, Missouri. In March of 1973, he made an application to the Director to transfer such license and his operation thereunder, to 1010 Oak Street, Kansas City, Missouri.

This application was denied by the Director upon the basis that due to the then existing density of the licenses in the area of 1010 Oak Street, the proposed transfer of Respondent's license was not in the best interest of the area. The Director's decision and the Board's order affirming that decision were based upon the provisions of Section 4.61, Chapter 4, Article X, Alcoholic Beverages, Code of General Ordinances of Kansas City, Missouri. This Article X covers 'Location of Retail and 'C.O.L.' ¹ Premises' and Section 4.61 thereof states:

'Discretion as to issuance. In passing upon any application for a license under this chapter, the director of liquor control shall have the authority to take into consideration the location of the proposed business and the density of alcoholic beverage licenses in the area for which a license is sought, and shall have authority to refuse or grant such license when in his judgment such issuance shall not be in the best interest of the locality involved.' (Emphasis supplied)

The Respondent's position in the administrative phases of this matter, in the court below and here, is that the Director had no authority under Section 4.61, as set out above, but in passing upon his application to transfer the license the Director was required to proceed solely under Section 4.53(b) of Article IX, entitled 'Renewals, Transfers, Lost Licenses and Changes in Licenses.' Section 4.53 is entitled 'Transfer of Location' and provides:

'(a) Application required. The director must first approve a transfer of a license to a different location and the application for permission to transfer must be in writing, together with twenty-five dollars ($25.00) to cover investigation costs, and shall set forth:

(1) The name and residential address of the licensee and current business address.

(2) The address and legal description of the premises to which transfer is sought, together with the name and address of the owner, a complete set of building plans, and a descriptive list of the fixtures in the proposed place of business.

(3) An affidavit by such licensee that he has not violated any of the provisions of this chapter or of the state liquor laws since the license was granted.

(4) Any additional information that the director may require.

(b) Discretion as to transfer. Any application for a transfer of location shall be processed when received. Nevertheless, the director may refuse to approve any transfer of the business of a licensee whenever such licensed business is under citation by the city or the state department of liquor control, and the matter has not yet been finally adjudicated.' (Emphasis added)

The pertinent allegations in the Respondent's petition filed in the court below seeking to set aside the final administrative rulings of the Director and the Board state his position as follows:

'6. That the action of the defendant Webb in refusing to permit the transfer is illegal, unreasonable, oppressive, discriminatory and a denial of due process. That the question of density has no standard, that too much discretion is vested in the Director. That in case of a transfer, the Director's discretion is defined in Section 4.53B. That Section 4.61 upon which the Director relies is not applicable.

7. That the action of the Liquor Control Board of Review sustaining the actions of the Director was illegal, unreasonable, oppressive, arbitrary and discriminatory, beyond the powers of the Director and a denial of due process to the plaintiff.'

The defendants in the proceedings below (appellants here) denied the allegations of the above-quoted parts of the petition and the cause was submitted to the court upon the transcript of the evidence in the hearing before the Board and the exhibits in connection therewith, without the introduction of further evidence.

No question is or was raised as to the form of Respondent's application to transfer his license from 4343 Troost to 1010 Oak; his compliance with the other procedural requirements of Section 4.53(a); or, that he was at the time under any unadjudicated citation from either city or state liquor control authorities. The sole basis for the Director's rejection of the application and the Board's affirmance of such refusal was Section 4.61, above quoted. The evidence established, without contradiction, that at the time of Respondent's application to transfer there were two existing establishments operating under C.O.L. licenses in the block at 1010 Oak; two in the block east; two in the block south; and, five others in the area.

The Director testified that he took these facts into account as well as the character of the area of 1010 Oak Street; the type of residents in the vicinity; and, concluded that the application to transfer should be denied because of all of these factors. He freely admitted that licenses had been issued (or transferred) in areas where the density of existing licenses was greater, but that such areas catered to conventions, tourist, transit and entertainment business. It was upon these facts that the administrative officials acted in the denial of the application within the discretion granted under Section 4.61, which the Respondent stoutly maintains is inapplicable. His position, that the only discretion granted the Director in these circumstances, is the narrow limit as set forth in Section 4.53(b), that the Director 'may' deny the transfer if a citation is pending against the applicant. This position is obviously untenable and was logically and forcefully demonstrated to be so by the court below in its Memorandum Opinion and Order. The portion of that opinion by Clark, J., here quoted, is adopted as the opinion of this court on this point:

'By Chapter 4 of its ordinances, Kansas City has adopted a plan for regulation of the sale of alcoholic beverages by licensing persons and premises where such business may be transacted. That such is a valid exercise of municipal authority has long been beyond any question. Zinn v. City of Steelville (351 Mo. 413), 173 S.W.2d 398 (Mo.1943).

The chapter is divided into fifteen articles, number IX of which deals with the subject of Renewals, Transfers, Lost Licenses and Changes in Licensees. It is from this article that section 4.53(b) quoted above is taken. Article X covering the subject, Location of Retail and 'COL' Premises, contains section 4.61 on the matter of discretion given the director, also quoted above. Other articles and sections of the chapter specify various restrictions as to the location of licensed premises including requirements as to compliance with fire, health and building codes, zoning ordinances, distances from churches and schools, conditions where the premises are partially occupied as a dwelling, visibility of the interior and numerous other conditions and limitations imposed in regulation of this business activity.

Plaintiff contends that section 4.53 covers the full subject matter of license transfers from one location to another and that defendant director is obligated to process a transfer application when in proper form subject only to an exercise of discretion when the subject is under citation by state or municipal liquor authorities. Under this interpretation, not only would section 4.61 be inapplicable to transfers, but other conditions required to be met in the original issuance of a license would also be ineffective.

To suggest that all regulatory power fails once a license has been issued and that upon application, the licensee may establish a new location without regard to compliance with any municipal code requirements is to demonstrate the absurdity of the proposition. The entire scheme of regulation in the sale of alcoholic beverages depends not only on the control of licenses when first issued but on continous (sic) supervision of those who hold licenses and operate the businesses in conjunction therewith. Such is and must have been the manifest intent of the council in adopting chapter 4 of the ordinances.

As a matter of draftsmanship, the subject ordinances leave much to be desired. Section 4.53 should cover the entire subject of transfers and should, at a minimum, incorporate by reference other sections applicable to the subject. We regard it as the duty of the Court, however, to construe the words used in the ordinance,...