Opinion
No. 33095
Decided November 12, 1952.
Intoxicating liquor — Board of Liquor Control — Cannot adopt rule inconsistent with statute — Liquor permits — Permit holder's place of business to be named in permit — Permit naming county, but omitting place of business, invalid — Permit holder's lease expired on premises named — Application for new permit after lease renewed — Notice and opportunity for full hearing required — Section 6064-16, General Code.
1. The Board of Liquor Control can not adopt any rule which is inconsistent with any statutory provision contained in the Liquor Control Act.
2. Section 6064-20, General Code, requires that each class or kind of permit issued under authority of the Liquor Control Act shall authorize the person named therein to carry on the business therein specified at the place or in the boat, vessel or class of dining car equipment therein described, and forbids the person named therein to carry on the business therein specified at any place or in any vehicle, boat, vessel or class of dining car equipment other than that named therein, and a purported permit which contains only the name of the person to whom it was purportedly issued together with the name of a city and county but with no designation of the place for which it was issued is invalid.
3. If the holder of a permit, which was regularly issued by the Board of Liquor Control, loses his lease on the premises for which the permit was issued and at a later date the permit expires and at a still later date he reacquires a lease on the same premises and makes application for issuance of a permit of the same class as he formerly held and for the same premises, the Department of Liquor Control must comply with the provisions of Section 6064-16, General Code, with respect to giving notice to the institutions enumerated therein and granting to them an opportunity for a full and complete hearing before the Director of Liquor Control.
IN MANDAMUS.
The relatrix undertakes to invoke the original jurisdiction of this court and to procure herein a writ of mandamus directing the respondents to "return" to her a class D-5 permit which, she alleges, was placed by her in the Department of Liquor Control for safekeeping pursuant to Regulation No. 16 of The Board of Liquor Control.
The Director of Liquor Control, who is the sole answering respondent, filed an extended answer. To that answer the relatrix filed a motion to strike certain allegations and concurrently with the motion filed a demurrer. The motion and the demurrer raise the same issue, to wit, the sufficiency of the answer. Detailed consideration of the motion is, therefore, unnecessary, even if, under an asserted agreement of the parties, the motion should not be considered as waived by the filing of the demurrer. The sole issue is the sufficiency of the answer.
On and after October 21, 1950, the relatrix was the holder of class D-5 permit, certificate No. 35959, which permitted her to operate at 5801 Clark avenue in Cleveland. She did so operate at that location by virtue of said permit until July 1951, when her lease expired and she was compelled to vacate the premises. She then placed that permit in the Department of Liquor Control for safekeeping pursuant to regulation No. 16 which provided:
"In the event that the premises of a permit holder are destroyed or rendered unuseable by fire, flood, acts of God, or other disaster, or by a loss of lease, or rights of tenancy, the permit holder may place his permit in the department for safekeeping for a period of six months, during which time he must diligently seek to rehabilitate his permit premises or secure a new location.
"At the end of the six months period, if after due diligence the permit holder has not secured a new location or has been unable to rehabilitate the permit premises, application may be made to the board for an extension of time.
"At the expiration of the six months period, or the extension thereof, if such permit holder does not have premises in which to conduct his business, the permit shall be cancelled without refund.
"Permits which are held by the department as provided in this regulation may be renewed while held by the department."
The period for which the permit was issued expired on October 17, 1951. The permitted period of deposit for safekeeping expired on December 28, 1951. In due time prior to the expiration date of the permit, relatrix made application under the last paragraph of regulation No. 16 for renewal of the permit. The application was favorably considered and class D-5 permit, certificate No. 21509, was issued in her name but with no place of business designated therein except Cleveland, Cuyahoga county, for the reason that she then had no place to operate. The new permit was then held in the Department of Liquor Control for safekeeping. For the new permit so issued on October 17, 1951, relatrix paid the full required fee of $1,000. Upon application of relatrix the period of deposit for safekeeping was extended to June 28, 1952.
The relatrix undertook, without success, to find a new location at which she could operate. On or about April 16, 1952, relatrix acquired a new lease of the premises previously occupied by her at 5801 Clark avenue. She then requested the Department of Liquor Control to "return" to her the permit then held by it for safekeeping. The department refused to comply with that request.
The answer of respondent alleges that certificate No. 21509 contains the language, "It is valid for a period of one year only from indicated date of issue and may not be used except by the above named holder at the location for which issued," which language is in accordance with the provisions of Section 6064-20, General Code; that no location "for which issued" was named; that on October 17, 1951, the relatrix did not have a lease of the premises located at 5801 Clark avenue but was then seeking permission to operate under class D-5 permit certificate at another location; that on August 31, 1951, the owner of the premises at 5801 Clark avenue applied for transfer of ownership of a certain class D-1 permit and a certain class D-2 permit to said 5801 Clark avenue; that a church and a school both located within 500 feet of said premises were notified in accordance with Section 6064-16, General Code, and they objected to the issuance of permits to that location; that hearing was had on those objections as required by Section 6064-16, General Code; that upon such hearing respondent determined that to allow the transfer would result in harm being done to the students of the school and the congregation of the church and, on October 20, 1951, rejected the application for transfer and no appeal was filed; that the insertion of 5801 Clark avenue on certificate No. 21509 and delivery of such certificate to relatrix would constitute the issuance by the Department of Liquor Control of a permit for the operation of a liquor business within a distance of 500 feet of a church and school without written notice to such church and school and without full and complete hearing as required by Section 6064-16, General Code; that the issuance of the permit to relatrix would not constitute the granting of an application of a permit holder for a permit of the same class for the same location since no location was specified in certificate No. 21509; that respondent was, at all times and now is, prepared to give notice to the church and school but will not issue the permit to relatrix for the premises located at 5801 Clark avenue, without first affording the church and school an opportunity to be heard in accordance with the provisions of Section 6064-16, General Code.
Mr. Isadore Topper and Mr. William J. Kraus, for relatrix.
Mr. C. William O'Neill, attorney general, Mr. Robert E. Leach and Mr. Brown W. Pettit, for respondent Director of Liquor Control.
The first and most important question to be answered is whether the respondent Director of Liquor Control had the power to issue a valid permit to relatrix on October 17, 1951. If he did not have such power the class D-5 permit, certificate No. 21509, was null and void and no right to operate under it ever accrued to relatrix.
By Section 6064-7, General Code, the Director of Liquor Control is empowered to exercise and perform the duties vested in the Department of Liquor Control. This includes the issuance of permits. The power of the director is limited by the powers and duties of the Board of Liquor Control as set forth in Section 6064-3, General Code. In the latter section (subsection 1 [b]) the board is given broad power to adopt rules and regulations including "rules and regulations with reference to applications for and the issuance of permits, for the * * * sale of beer and intoxicating liquor, and the sale of alcohol, subject to the provisions of the Liquor Control Act and amendments thereof."
It is obvious that the board has no power to adopt rules which are not consistent with specific statutory provisions.
Section 6064-20, General Code, which relates to the issuance of permits, provides:
"Each class and kind of permit issued under authority of the Liquor Control Act shall authorize the person therein named to carry on the business therein specified at the place * * * therein described, for a period of one year commencing on the day after the date of its issuance, and no longer * * *; and no such permit shall be deemed to authorize the person named therein to carry on the business therein specified at any place * * * other than that named therein * * *." (Emphasis supplied.)
Section 6064-20, General Code, requires that each permit be issued for operation at a specified location. By inference it forbids issuance of a license to a person to operate generally in an area such as a city or county. Rule 16 can not authorize that which Section 6064-20, General Code, forbids.
We do not condemn rule 16 as a whole. It doubtless serves a useful purpose. It simply can not be applied to the facts of this case. Here the relatrix lost her lease and did not acquire a new lease of the same premises until after her permit had expired. At the time of the purported renewal, October 17, 1951, she could not be issued a license to operate at a specified location and therefore the director was without power to issue a license to her.
The second question is whether the relatrix has the right to have certificate No. 21509 or any D-5 permit issued to her for 5801 Clark avenue without notice to the church and school and opportunity of the church and school to be heard.
In view of what we have said above, the relatrix can not base any claim of right to a permit upon the issuance or existence of certificate No. 21509.
This would decide the entire controversy except for one contingency. It is suggested that the Department of Liquor Control could and should at least consider the request of relatrix for "return" of her permit as an application for a D-5 permit for 5801 Clark avenue. We do not undertake to decide whether the department should so construe and consider the application. We do say that if the request of relatrix for "return" of the permit is to be considered as an application for a new permit it would be necessary for the director to comply with the provisions of Section 6064-16, General Code, which require notice to the church and school and full hearing upon objections if filed. The position taken by the respondent is justified.
For the reasons stated, we hold that the answer of respondent states a defense. Both the motion of the relatrix to strike from the answer and the demurrer to the answer are overruled, and, the parties not desiring to plead further, a writ of mandamus is denied.
Judgment accordingly.
WEYGANDT, C.J., ZIMMERMAN, STEWART, TAFT, MATTHIAS and HART, JJ., concur.