Judgment unanimously reversed on the law with costs and petition reinstated. Memorandum: In this CPLR article 78 proceeding petitioner seeks annulment of the respondent's determination denying it minority business enterprise status. Based on the fact that its president, sole shareholder and director is black, petitioner applied for certification as a minority business. After review and on-site investigation the application was rejected by respondent due to lack of actual operational and managerial control by the minority owner of the enterprise. Petitioner initially sought administrative review of this decision, but then withdrew its request upon discovering that no formal review procedures had been established. In the present article 78 proceeding petitioner asserts that it met all qualifications for minority business status, including being solely owned by its president, a black, who fully operated and managed the business. In its answer the respondent provided the court with his findings of fact and conclusions derived from the petitioner's application and the department's subsequent investigation. Special Term without a hearing dismissed the petition, finding that respondent's determination was not arbitrary or capricious. That was error. Clear factual issues are presented as to whether petitioner is actually operated and managed by minority interests and those issues require a full hearing (Matter of Masder Bldrs. v Overton, 15 A.D.2d 551; Matter of Ellis v Allen, 4 A.D.2d 343, appeal dismissed 4 N.Y.2d 693).