Prestige Stations, Inc. v. Washington Liquor Control Bd., 5296-2-II
| Decision Date | 24 November 1982 |
| Docket Number | No. 5296-2-II,5296-2-II |
| Citation | 657 P.2d 322,33 Wn.App. 669 |
| Parties | PRESTIGE STATIONS, INC., a Delaware corporation, Appellant, v. WASHINGTON LIQUOR CONTROL BOARD, Respondent. |
| Court | Washington Court of Appeals |
Kenneth O. Eikenberry, Atty. Gen., Jack S. Eng, Asst. Atty. Gen., Olympia, for respondent.
Prestige Stations, Inc. (Prestige) appeals dismissal of its petition for review of the Washington State Liquor Control Board's (Board) denial of an initial application for a liquor license. Prestige sought review under the Administrative Procedure Act, RCW 34.04, the statutory writ of review (RCW 7.16.030-.140), and the court's inherent power of review under article 4, section 1 of the state constitution. The Board, responding to an order to show cause why a writ should not issue, contended that Prestige failed to state a claim for relief because the matter is not a contested case and therefore not reviewable under the Administrative Procedure Act; the denial of a liquor license is not a judicial function reviewable under RCW 7.16.040; and the allegations of the petition are insufficient to invoke the court's inherent constitutional power of review since the sale of liquor does not involve a fundamental right and no other violation of a fundamental right On appeal, Prestige claims the court erred in denying review under the Administrative Procedure Act or alternatively under the court's inherent constitutional power of review.
is alleged, even though the Board's action is alleged to be arbitrary, capricious and contrary to law. No issue is raised by the Board as to Prestige's standing to invoke the court's inherent constitutional power of review. The trial court agreed with the Board and dismissed for lack of jurisdiction
The issues presented by this appeal are:
1. Whether denial of an initial application of a liquor license is a "contested case" under the Administrative Procedure Act and thus subject to review by the courts.
2. Whether the requirement of a violation of a fundamental right to invoke the court's inherent constitutional power of review is satisfied by a claim that the administrative action is arbitrary, capricious or contrary to law.
We agree with the trial court that denial of an initial application for a liquor license is not a contested case and therefore not subject to judicial review under the Administrative Procedure Act. However, we believe that the fundamental right concept as it applies to the court's inherent power of review is implicit in each instance of administrative action that is arbitrary, capricious or contrary to law since the fundamental right referred to is simply the right to be free from such action. We therefore reverse the judgment.
Prestige owns a combination grocery store and gas station, or "mini-mart," located on Northeast Bellevue-Redmond Road in Bellevue, Washington, which apparently is within 500 feet of a public junior high school. In 1978, Prestige applied for a class E and F liquor license which would authorize it to sell beer and wine for consumption off premises. RCW 66.24.360, .370. As part of the application process the Liquor Control Board solicited comments from the Bellevue School District. In response the district indicated it had no specific policy regarding liquor sales or Our investigation disclosed that it is not advisable to approve this application, since the Board has information which has been confirmed by school officials, that because of the location this would be determental [sic ] to the best interest of the school operation.
liquor licensing in the vicinity of schools, but did have a policy that "any commercial activity within 500 feet of an elementary school and one quarter mile from a junior or senior high school is generally deterimental [sic ] to the best interests of school operation." The Liquor Control Board denied the license reasoning
Prestige's application was again denied in September, 1980, for the same reason. This later denial was followed by the petition for review to the Thurston County Superior Court and this appeal.
The final decision of a state administrative agency is subject to judicial review if the case is a "contested case" as defined by the APA, and if judicial review is not otherwise specifically excluded in the Act. RCW 34.04.130, .150; Herrett Trucking Co. v. Washington Public Serv. Comm'n., 58 Wash.2d 542, 364 P.2d 505 (1961).
The APA as originally enacted in 1959 specifically excluded the Liquor Control Board. Laws of 1959, ch. 234, § 15 (current version at RCW 34.04.150). RCW 66.08.150 as originally enacted provided that the action of the Liquor Control Board as to any permit or license was final and not subject to judicial review. Laws of 1933, 1st Ex.Sess, ch. 62, § 62. In 1963, the Legislature amended RCW 34.04.150 to remove the Liquor Control Board from the exclusionary provision of the APA which indicated a "changing legislative policy, recognizing the efficacy of judicial review in a proper case, however 'plenary' the legislative power may be" with respect to intoxicating liquor. State ex rel. Shannon v. Sponburgh, 66 Wash.2d 135, 140, 401 P.2d 635 (1965); Laws of 1963 ch. 237. Assuming it was the legislative intent to allow for judicial review, in 1967 the Legislature again restricted the extent of such review. Whereas prior to 1967 the APA made no reference to licensing in the definition of a contested case, in 1967, RCW 34.04.010(3) defining contested cases was amended to include specifically licensing but referenced liquor license permits:
Contested cases shall also include all cases of licensing and rate making in which an application for a license or rate change is denied except as limited by RCW 66.08.150, or a license is revoked, suspended, or modified, or in which the granting of an application is contested by a person having standing to contest under the law or agency rules.
(Italics ours.) Also in 1967, in this same amendatory act, RCW 66.08.150 was amended to its present form which reads in part:
The action, order or decision of the board as to any denial of an application for the reissuance of a permit or license or as to any revocation, suspension, or modification of any permit or license shall be a contested case and subject to the applicable provisions of chapter 34.04 ....
The plain meaning of RCW 34.04.010(3) and RCW 66.08.150 is to include in the definition of a "contested case" an application for reissuance, or revocation, suspension, or modification, and to exclude an initial application for a liquor permit. Review of denial of an initial liquor license application is not attainable under the APA.
The judiciary will review agency action under its inherent supervisory capacity, to determine if the agency's conclusions are as a matter of law arbitrary, capricious or contrary to law. Williams v. Seattle School Dist. 1, 97 Wash.2d 215, 643 P.2d 426 (1982); State ex rel. Hood v. Personnel Bd., 82 Wash.2d 396, 511 P.2d 52 (1973). In State ex rel. DuPont-Fort Lewis School Dist. 7 v. Bruno, 62 Wash.2d 790, 794, 384 P.2d 608 (1963), the court articulated what has been interpreted to be a second element of inherent review, namely, the action must "do violence to a fundamental right."
In the instant case, the trial court dismissed the writ of review with prejudice for lack of jurisdiction concluding that since there is no fundamental right involved in the denial of a new liquor license application, the allegations that the Board acted arbitrarily and capriciously and in excess of statutory authority are not sufficient to invoke the court's inherent power of review. The trial court correctly noted there is no fundamental right to sell liquor. Randles v. Liquor Control Bd., 33 Wash.2d 688, 206 P.2d 1209, 9 A.L.R.2d 531 (1949), but understandingly misinterpreted the fundamental right requirement.
In Wilson v. Nord, 23 Wash.App. 366, 597 P.2d 914 (1979), we interpreted the fundamental right requirement to be an alternate formation of the illegality requirement where we stated:
It is sometimes said that the scope of review in nonstatutory review cases carries another limitation, namely, that the asserted illegality must involve a "fundamental right." Our reading of the cases espousing this test convinces us that it is not a further limitation on the scope of review, but simply an alternate formulation of the illegality standard set out in Helland [Helland v. King Cy. Civil Serv. Comm'n., 84 Wn.2d 858, 529 P.2d 1058 (1975) ] and Reiger. [Reiger v. Seattle, 57 Wn.2d 651, 359 P.2d 151 (1961).]
* * *
Thus, the fundamental right limitation boils down to a rule which says that a complainant with standing has a fundamental...
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