Summary
In Rosenthal v. Department of Revenue, 40 Colo. App. 422, 579 P.2d 1176 (1978), this court determined that Regulation 18 E was void for lack of guidelines, and we held that the failure to submit an application under 18E could not be the basis for suspending a liquor license.
Summary of this case from Stockade, Inc. v. Local Lic. AuthOpinion
No. 77-181
Decided March 2, 1978. Rehearing denied March 30, 1978. Certiorari granted June 5, 1978.
Because liquor licensee did not file application relative to enlargement of its premises as directed by state licensing authority, its license was suspended, and the licensee brought action to review. Trial court affirmed the suspension, and licensee appealed.
Reversed
1. INTOXICATING LIQUORS — Enlargement of Premises — Liquor Licensee — Required Decision — Licensing Authorities — No Guidelines — Regulation Void. Since Department of Revenue regulation pertaining to the expansion or enlargement of a liquor licensee's premises required a decision on the proposed expansion or enlargement to be made by local and state licensing authorities, but provided no guidelines for those authorities to use in either granting or denying such a proposed change, that regulation is void.
2. Expansion of Premises — Regulation — Void — Failure to File — Application — No Basis — Suspension of License. Inasmuch as Department of Revenue regulation pertaining to expansion or enlargement of liquor licensees' premises is void for lack of guidelines, the licensees' failure to file application called for under that regulation cannot serve as the basis for a suspension of the licensees' license.
Appeal from the District Court of the County of Morgan, Honorable Earl A. Wolvington, Judge.
Donald K. Smith, David M. Korrey, for plaintiff-appellants.
J. D. MacFarlane, Attorney General, David W. Robbins, Deputy Attorney General, Edward G. Donovan, Special Assistant Attorney General, Chris J. Eliopulos, Special Assistant Attorney General, for defendants-appellees.
Plaintiffs are the holders of a hotel and restaurant license which authorizes them to sell spirituous liquors by the drink to customers for consumption on the premises. After a hearing before the Executive Director of the Department of Revenue, Liquor Enforcement Division, plaintiffs' license was suspended because of their allegedly selling liquors off the licensed premises. Contending that the director acted arbitrarily and capriciously in suspending their license, they sought review by a C.R.C.P. 106(4)(a) proceeding. The trial court affirmed the director's decision and they appeal. We reverse.
Plaintiffs were advised by a liquor inspector for the state licensing authority that they were required to make application to the local and state licensing authority for permission to enlarge their premises by filing an application as required by the Department of Revenue Regulation 18 E. Plaintiffs refused to make application, and this suspension followed.
Since no guidelines have been established for the licensing authorities to either grant or deny an application to enlarge the premises, neither the public nor the courts have any means of knowing in advance what evidence might be considered material to any particular decision.
[1] Without such guidelines it is impossible for the courts to make any meaningful review of the decision of the licensing authority. See Elizondo v. State of Colorado, 194 Colo. 113, 570 P.2d 518. Since Regulation 18 E requires a decision to be made by the licensing authority but provides no guidelines for it to use in either granting or denying an application to expand or enlarge the licensed premises, that regulation is void.
[2] Furthermore, since no review could have been made of the decision either granting or denying the license, it would have been an idle gesture for plaintiffs to have filed the application as required by Regulation 18 E. Consequently, the plaintiffs' failure to submit the application cannot serve as a basis for suspension of their license.
The judgment of the trial court in affirming the order of suspension of plaintiffs' license is reversed and the cause is remanded with directions to the trial court to order the defendant to reinstate plaintiffs' hotel-restaurant license. The executive director of the Department of Revenue is directed to comply with § 12-4-105, C.R.S. 1973 within thirty days from the issuance of the mandate in this case and to promulgate reasonable rules and regulations so that a review of an application for expansion or enlargement of the premises can be made. Within ten days after publication of said rules and regulations, plaintiffs may make application for expansion or enlargement of their premises, and hearing will then be had in accordance with said rules and regulations. If plaintiffs make application they shall be allowed to operate their restaurant in the expanded area until such time as a final determination has been made based on the new rules and regulations, without prejudice for having operated within the expanded area prior to filing application for expansion.
JUDGE ENOCH and JUDGE PIERCE concur.