Yerardi's Moody Street Restaurant and Lounge, Inc. v. Board of Selectmen of Randolph

• Decision Date: 01 April 1985
• Citation: 473 N.E.2d 1154,19 Mass.App.Ct. 296
• Court: Appeals Court of Massachusetts
• Parties: YERARDI'S MOODY STREET RESTAURANT AND LOUNGE, INC. v. BOARD OF SELECTMEN OF RANDOLPH et al. 1

Page 1154

473 N.E.2d 1154

19 Mass.App.Ct. 296

YERARDI'S MOODY STREET RESTAURANT AND LOUNGE, INC. v. BOARD OF SELECTMEN OF RANDOLPH et al. ¹

Appeals Court of Massachusetts Suffolk.

Argued Dec. 10, 1984.

Decided Jan. 31, 1985.

Further Appellate Review Denied April 1, 1985.

Michael W. Reilly, Reading, for plaintiff.

William J. Carr, Town Counsel, Boston (Jonathan C. Young, Braintree, with him), for Bd. of Selectmen of Randolph.

Before BROWN, KAPLAN and SMITH, JJ.

KAPLAN, Justice.

The plaintiff Yerardi's Moody Street Restaurant and Lounge, Inc. (Yerardi), the holder of an all-alcoholic beverages license with a closing time of 1:00 A.M., petitioned the board of selectmen of Randolph (board), the local licensing authority, to "extend" the closing time to 2:00 A.M. After hearing, the board denied the petition. Yerardi then brought the present action to annul the board's decision. A judge of the Superior Court upheld the board. We reverse and remand so that the board may reconsider the petition in the light of this opinion.

Statement. Although not so designated by the parties, this action should be understood to be a civil action in the nature of certiorari as contemplated by G.L. c. 249, § 4, with the function of bringing up the action of the board for such judicial review as may be available. The record here consisted of the minutes of the relevant board hearings together with certain supplemental affidavits. The board moved to dismiss. Treating the motion as one for summary judgment, the judge allowed it. Following are the facts disclosed of record.

In August, 1980, Yerardi applied for a transfer of the instant license from Creative Dining Concepts, Inc., to itself. The board considered the application at meetings on August 25 and September 8, 1980. It was represented that there had been problems with the licensee over the past year or two; after-hours drinking and parking were mentioned. Would there be adequate control under the new management? Some assurances were given on this point. The town's chief of police did not object to the proposed transfer. After discussion, the board, by a vote of 2-1, approved the transfer but with the condition that the 2:00 A.M. closing enjoyed by the transferor be changed to 1:00 A.M.

Yerardi appealed to the Alcoholic Beverages Control Commission (ABCC), attacking the 1:00 A.M. condition on the transfer, and also brought an ancillary action against ABCC and the board in the Superior Court in Norfolk County. Yerardi failed at the ABCC, and the action was dismissed by stipulation of the parties on April 16, 1981.

On August 10, 1981, the board considered and denied an application by Yerardi to extend the closing hour to 2:00 A.M. Yerardi sought review of the decision by the ABCC but that body wrote that it had no jurisdiction. ² Again, on April 12, 1982, the local board heard an application to extend. The board afforded a hearing. On analogy, it seems, to the procedure upon an application for an original license (see c. 138, § 15A), it required Yerardi to publish notice and to give notice to abutters of the hearing. ³ On that occasion, Yerardi by its counsel pointed out, and there was no contradiction, that four other licensees in the vicinity, whose situations in relevant respects were similar to Yerardi's, held 2:00 A.M. licenses; ⁴ that Yerardi's experience in the way of calls for police assistance compared favorably with the others'; and that the town's chief of police and safety officer did not object to the proposed extension. There was indication, further, that some Yerardi customers, upon leaving the place around 1:00 A.M., went to the other competing locations to continue drinking.

As opposed to Yerardi's submission, one or more speakers expressed the feeling that 2:00 A.M. closings should be pushed back. In that connection, Yerardi showed as part of the materials on the summary judgment motions that, on dates subsequent to the board's decision of April 12, 1982, denying an extension for Yerardi, the board voted down a proposal for a general roll back to 1:00 A.M., and approved a transfer of a 2:00 A.M. license held by one of the four licensees mentioned without imposing a cut to 1:00 A.M.

The board's decision on April 12 by a 3-2 vote to deny Yerardi's application was not accompanied by a statement of reasons. However, an affidavit of December 20, 1982, by the three selectmen, submitted on the motions, stated that they "individually and collectively had in mind" the following: At the time of the 1980 transfer of license, Yerardi raised no objection to the 1:00 A.M. closing; ⁵ over the last two years on the South Shore there had been "a great deal of media coverage and citizen reaction to accidents and deaths" from drunken driving; some municipalities had rolled back closing hours and others were considering doing so. The affidavit also stated: "These are not all of our reasons."

Statutory background. By G.L. c. 138, § 12, sixth par., as appearing in St.1977, c. 929, § 2, ⁶ questions of closing hours in the period 11:00 P.M. to 2:00 A.M. are committed to the local licensing authorities; the ABCC was right in disclaiming jurisdiction, compare Casa Loma, Inc. v. Alcoholic Bev. Control Commn., 377 Mass. 231, 385 N.E.2d 976 (1979), and the State Administrative Procedure Act, G.L. c. 30A, is not relevant. Id. at 235, 385 N.E.2d 976. The statutory standard that governs a local authority in choosing this or that closing hour--whether as a general regulation or for a particular licensee--is "the public need." See Pronghorn v. Licensing Bd. of Peabody, 13 Mass.App. 70, 73, 430 N.E.2d 842 (1982). In case of a proposal to decrease hours of business of any licensee, the local authority is expressly directed to hold a public hearing on notice. The statute does not mention proposals to increase hours and so does not speak of hearings on such matters. There is no express provision in § 12, sixth par., for judicial review of a local authority's decision decreasing hours and, of course, none regarding a decision denying an increase of hours.

Judge's position. In ruling for the board, the judge wrote that there was no legal requirement that Yerardi be accorded any hearing on its application. He also said that the record on the hearing that had been held was sufficient to support the board's decision as being neither arbitrary nor capricious, even though he, the judge, might think the evidence preponderated in Yerardi's favor.

Analysis. A "civil action in the nature of certiorari" pursuant to G.L. c. 249, § 4, serves to "correct errors" in administrative proceedings by means of judicial review where such oversight is not otherwise provided by statute. See Reading v. Attorney General, 362 Mass. 266, 269-272, 285 N.E.2d 429 (1972); McSweeney v. Town Manager of Lexington, 379 Mass. 794, 799, 401 N.E.2d 113 (1980); Saxon Coffee Shop, Inc. v. Boston Licensing Bd., 380 Mass. 919, 923, 407 N.E.2d 311 (1980). Cf. Hill v. Superintendent, Mass. Correctional Inst., Walpole, 392 Mass. 198, 199 n. 2, 466 N.E.2d 818 (1984). The nature or scope of the review accommodates to the kind of administrative decision involved, and this in turn is conditioned by the type of substantive rule or standard that is being applied. See McSweeney, supra 379 Mass. at 799-800, 401 N.E.2d 113; Saxon, supra 380 Mass. at 923-925, 407 N.E.2d 311; Newbury Junior College v. Brookline, 19 Mass.App. 197, 201-203, 472 N.E.2d 1373 (1985). By the teaching of Caswell v. Licensing Commn. for Brockton, 387 Mass. 864, 444 N.E.2d 922 (1983), the fact that a statute empowering a given administrative agency does not contain "narrow and objective criteria" (at 878, 444 N.E.2d 922), but rather refers to a broad standard, tends to indicate that judicial review does not extend to an assessment of the strength of the evidence supporting the agency's action, but is limited to a search for "error of law or abuse of discretion, as measured by the arbitrary or capricious test." (At 878, 444 N.E.2d 922). ⁷ "[T]he public need," as appearing in G.L. c. 138, § 12, sixth par., is certainly well removed from a narrow or objective criterion; and Casa Loma, 377 Mass. at 234, 385 N.E.2d 976, finding no error in a local authority's decrease of a licensee's hours under § 12, sixth par., discerned "a legislative intention to permit unreviewable policy considerations to govern the availability of 'extra' hours for licensees." We think the same holds for the denial of an increase of hours. However, the discretion lodged in the local authorities is not unlimited. These agencies may not act upon mere whim or vagary. Put another way, besides the unreviewable elements in the agency decisions, there are other elements submissible to the test of elementary justice that is invoked by the words "arbitrary or capricious." That test was the point of reference in Pronghorn, 13 Mass.App. at 74, 430 N.E.2d 842, even where the agency action under review was a general roll back of the closing hour in the locality, as distinguished from agency action directed to a single licensee. ⁸ See also Newbury, supra 19 Mass.App. at 202-203, 472 N.E.2d 1373.

In the present case, we have to consider whether there is cause to believe that the agency, by gross illogic, has arbitrarily singled out an individual for unequal and perhaps invidious treatment. The judge below did not deal with the specifics.

Yerardi established in the record that its situation was similar to that of its competitors in the vicinity who were enjoying 2:00 A.M. closings. Nor could it be said that the board was phasing out these closings as licenses were transferred: a transfer was voted without a roll back, and another proposal to adopt a 1:00 A.M. over-all closing failed of adoption. The affidavit stating what the members "had in mind" hardly explains their decision of Yerardi's case; and the statement that the reasons set out were "not all of our reasons" teases a court without...