Smith v. Iowa Liquor Control Commission, 53462

Citation169 N.W.2d 803
Decision Date24 July 1969
Docket NumberNo. 53462,53462
PartiesIris Iona SMITH, Appellant, v. The IOWA LIQUOR CONTROL COMMISSION et al., Appellees.
CourtUnited States State Supreme Court of Iowa

Alfred M. Pabst, Albia, for appellant.

Richard C. Turner, Atty. Gen., William A. Claerhout, Asst. Atty. Gen., and James D. Jenkins, Albia City Atty., for appellees.

GARFIELD, Chief Justice.

Plaintiff Iris Smith brought certiorari in the district court to review, as in excess of jurisdiction and illegal, orders of Iowa Liquor Control Commission (herein called 'commission') conforming the revocation by operation of law of her class 'B' state beer permit and concelling her class 'C' Iowa Liquor Control license. Following trial the cancellation of the liquor license was annulled but the order confirming revocation of the state beer permit was sustained. (See rule 316 Rules of Civil Procedure.) Plaintiff has appealed from so much of the court order as sustained the commission's action as to the beer permit.

For convenience we disregard the fact the members of the commission, the City of Albia and members of its council were also made parties to the certiorari action.

So much of the court order as annulled the commission's cancellation of the liquor license is not an issue on this appeal. We may say, however, such part of the court order is based on the fact the commission's action was 'pursuant to section 123.32(d)' Code 1966 which provides for notice in writing to the license holder and reasonable opportunity for hearing before the action may be taken.

The commission's order as to the beer permit was taken under Code section 124.30(3) which provides such a permit 'shall automatically be revoked and shall immediately be surrendered by the permit holders * * * upon any of the following events: * * * 3. If any agent or employee of the permit holder is convicted of any violation of subsection three of section 124.20 in or about the place of business for which the permit is issued.'

Section 124.20, subsection 3, so far as pertinent, provides: 'No person shall knowingly sell * * * any * * * beer to any minor, except within a private home and with the knowledge and consent of the parent or guardian of said minor. No person shall knowingly permit any minor to purchase * * * beer on the premises of a class 'B' or class 'C' permit holder.'

The commission's order, sustained by the trial court, refers to the two provisions just set out and recites that on March 4, 1968 a jury in Monroe County district court found Elsie Watts guilty of violating section 124.20, subd. 3, the violation occurred on the premises of the holder of permit 4159--67, revocation of the permit by operation of law was confirmed, the permit was declared immediately revoked and the bond of the permit holder forfeited.

The trial court reasoned that the statutes under which the beer permit was, in effect, revoked do not require prior notice to the permittee or opportunity to be heard; the right of a state legislature to provide for revocation of permits for the sale of beer without notice or hearing is well established; the commission's return to the writ of certiorari shows it had before it a copy of the record entry of the sentence of Elsie Watts, reports of its investigating officer, a copy of the statement of Steve Johnson, the minor to whom Elsie sold the beer in plaintiff's tavern, with a photocopy of his draft registration card which he exhibited to Elsie showing his then age as 18.

The court concluded it cannot be said the commission acted capriciously or arbitrarily (as plaintiff's petition for the writ alleged), with such records before it, in ordering revocation of the permit and the claim the commission denied plaintiff due process of law in so doing without notice or hearing is disposed of by our decision in Walker v. City of Clinton, 244 Iowa 1099, 1102--1105, 59 N.W.2d 785, 787--788.

I. Before considering the three errors plaintiff assigns upon this appeal reference to the evidence, much of which appears by stipulation, should be made.

Plaintiff Iris Smith operated a beer tavern in Albia more than 20 years until March 23, 1968 when she received the commission's order issued the previous day confirming the revocation by operation of law of her beer permit 4159--67. On January 12, 1968 the minor Steve Johnson entered the tavern and asked Elsie Watts, then acting as bar maid, to sell him two 6-packs of Hamm's beer. Asked to see his identification, Steve showed Elsie his draft registration card giving his age as 18 years, two months; Elsie handed him the beer, he left the tavern and was arrested for illegal possession of beer, evidently as a minor; the next day Steve pleaded guilty to the charge and was ultimately fined $50 or ordered to spend 15 days in jail; without money to pay the fine, he went to jail. These matters appear from the signed statement of the minor, with photocopy of the draft card affixed, previously referred to, given the deputy sheriff and Albia Chief of Police on January 15.

On February 23, 1968 Elsie Watts was indicted for the offense of selling beer to a minor in violation of Code section 124.20, subd. 3 quoted supra. Upon trial a jury found her guilty on March 4. She was fined $300 and costs on March 11 and ordered confined to jail one day for each $5 of the fine that was unpaid. The fine was paid that same day.

Plaintiff's beer permit 4159--67 expired March 7, 1968. Her application to the city council for renewal of the permit was withdrawn on March 4, the day Elsie was found guilty. A special meeting of the council was called for 5:00 P.M. on March 11, the day Elsie was sentenced, to consider another application made that day for renewal of the permit. The council voted unanimously to renew the permit for a year, effective the following day.

At this special meeting plaintiff's attorney appeared before the council and stated she contended Elsie Watts was not her employee or agent on January 12, 1968 when Elsie sold the beer to the minor; the issue of agency was brought to the council's attention and several of its members indicated that since the question was unclear they were willing to give plaintiff the benefit of the doubt as her tavern has existed more than 20 years, was the best in Albia and had given its officers the least difficulty. A transcript of part of the testimony of Elsie Watts and plaintiff in the criminal trial of the former was considered by the council; the city attorney advised it that in his opinion no license existed on March 11 when Elsie was sentenced and it was therefore not bound by the mandatory revocation provision of section 124.30(3) but could in its discretion refuse to issue a permit if it so chose.

Plaintiff is the only witness who testified personally at the trial of the certiorari case. Elsie Watts was not plaintiff's regular employee but helped her when Mary Gray, regularly employed, was unable to work. On January 12, 1968 Mary was ill and went to Iowa City for an examination. She obtained Elsie to help plaintiff that day. Elsie came to the tavern about 11, left to fix her husband's supper about five, returned to the tavern and stayed while plaintiff went to supper at six and left again when plaintiff returned.

Later that evening Elsie returned to the tavern again with her husband and, since plaintiff was waiting on other customers, Elsie waited on the minor Johnson without being asked to do so. Plaintiff admitted she saw the young man enter the tavern and saw Elsie go to the front of the place but denied she saw her sell him the beer. Plaintiff admitted she saw Elsie making out a piece of paper before the beer was sold the boy; she asked Elsie what had been written as she (plaintiff) was curious about it; Elsie replied it was none of plaintiff's business, also that she might need the paper.

Plaintiff further testified Elsie had helped Mary Gray about the last two years when Mary was unable to work in the tavern; on these occasions Elsie served beer and mixed drinks and did what Mary would have done; plaintiff insisted she had never paid Elsie and did not know whether Mary had done so.

The partial transcript of Elsie's testimony in her criminal trial, offered in evidence by plaintiff in the certiorari case and displayed to the city council at its special meeting, shows she then testified she assisted plaintiff some in her tavern on the night of January 12 but was not employed by her to work that night; Elsie and her husband are there about every night because plaintiff is there by herself and when she gets busy Elsie helps her; that was the situation on January 12; asked by the county attorney (in the criminal trial) whether she had worked for Mrs. Smith quite a bit, Elsie replied probably about 30 years off and on; she had not been called to work in the tavern that night because she had worked there all day.

II. Some further reference to the decision appealed from is called for. The court held the fact the commission did not confirm the automatic revocation of the beer permit which expired March 7 until March 22 is not important since it was in effect when the offense was committed that led to the order; the only permit affected because of a violation of subsection 3 of section 124.20 is the one in force at the time of such violation; the issuance by the city council on March 11, 1968, of a new class B permit to plaintiff was forbidden by section 124.30(3) which provides: 'If * * * any permit is revoked under the provisions of this section * * * the person whose permit is revoked shall not thereafter be allowed to obtain or hold a permit under this chapter.'

III. The errors relied on for reversal are in substance: (1) The commission's order of March 22, 1968, without notice to anyone was illegal, arbitrary and without jurisdiction under the statutes then in effect. (2) The court erred in determining that an agency existed between Elsie Watts and appellant on January...

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