Williamson v. New York State Liquor Authority

Majority

p. 360

In the Matter of Cyril E. Williamson et al., Appellants, v. New York State Liquor Authority, Respondent.

Argued June 8, 1964;

decided July 10, 1964.

p. 361

Robert W. Corcoran for appellants.

I. The determination of an administrative agency must be based upon findings of fact, which, in turn, must have support in the record. In the present case the determination of respondent is conclusory only and contains no findings of fact. (Matter of Elite Dairy Prods. v. Ten Eyck, 271 N. Y. 488 ; Matter of New York Water Serv. Corp. v. Water Power & Control Comm., 283 N. Y. 23 ; Matter of Barry v. O'Connell, 303 N. Y, 46 .) II. The action of the Authority here complained of is not based on any factual standard, and is thus arbitrary and capricious. (People ex rel. Hultman v. Gilchrist, 114 Misc. 651 .) III. Good administrative practice requires that factual standards governing location and removal of package liquor stores be reduced to an understandable formula, promulgated as a rule, and filed with the Secretary of State.

p. 362

Emanuel D. Black, Hyman Amsel and Lawrence Kunin for respondent.

I. The State Liquor Authority, in refusing to permit a removal of petitioners’ off-premises liquor license from their present location, was exercising its discretion under sections 2 and 111 of the Alcoholic Beverage Control Law. The determination to disapprove the application, upon the record presented, was a reasonable exercise of that discretion. It was neither arbitrary nor unreasonable. It was lawful and not in violation of any rights of petitioners. Petitioners having failed to disclose circumstances which leave no possible scope for the exercise of the Authority’s discretion in the manner complained of, the Appellate Division properly reversed the order of Special Term and dismissed the petition herein. The findings of the Authority were adequate within the requirements of law. (Matter of Wager v. State Liq. Auth., 4 N Y 2d 465 ; Matter of Rockower v. State Liq. Auth., 4 N Y 2d 128 ; Matter of Fink v. Cole, 1 N Y 2d 48 ; Matter of Colgate-Palmolive-Peet Co. v. Joseph, 308 N. Y. 333 ; Matter of Kilgus v. Board of Estimate of City of N. Y., 308 N. Y. 620 ; Matter of Joseph Burstyn, Inc., v. Wilson 303 N. Y. 242 ; Matter of Fiore v. O’Connell, 297 N. Y. 260 ; Matter of Stracquadanio v. Department of Health, 285 N. Y. 93 ; Matter of Kaplan v. O’Connell, 281 App. Div. 46 , 305 N. Y. 850 ; Matter of John J. King, Inc., v. O’Connell, 280 App. Div. 852 ; Matter of Restaurants & Patisseries Longchamps v. O’Connell, 271 App. Div. 684 , 296 N. Y. 888 ; Matter of Battaglia v. O’Connell, 269 App. Div. 1002 .) II. A court may not substitute its judgment for that of the administrative agency or officer with whom discretion has been lodged by the Legislature. (Communications Comm. v. WOKO, 329 U. S. 223 ; Matter of Commercial Pictures Corp. v. Board of Regents, 280 App. Div. 260 , 305 N. Y. 336 , 346 U. S. 587 ; Matter of Glintenkamp v. O’Connell, 271 App. Div. 795 , 296 N. Y. 806 ; Matter of Snetlage v. O’Connell, 271 App. Div. 1015 , 297 N. Y. 707 ; Matter of Watinsky v. O’Connell, 271 App. Div. 973 , 297 N. Y. 552 ; Matter of Taub v. Pirnie, 3 N Y 2d 188 ; Matter of Town of Waterford v. Water Pollution Bd., 5 N Y 2d 171 ; Matter of Schwartz v. Falk, 5 A D 2d 46 , 5 A D 2d 908 , 5 N Y 2d 706 ; Matter of Barry v. O’Connell, 303 N. Y. 46 ; Matter of France v. O’Connell, 204 Misc. 681 , 282 App. Div. 1011 .) III. On this record it cannot be said that the Authority acted in an arbitrary or capricious manner and, hence, the court cannot

p. 363

annul its determination. (Matter of Rockower v. State Liq. Auth., 4 N Y 2d 128 ; Matter of Lenward Liq. Corp. v. New York State Liq. Auth., 19 A. D 2d 612 .)

Petitioners-appellants’ application has been denied by the State Liquor Authority, overruling the local ABC board, for removal of their package liquor store from Franklin Square to Forest City, North Bellmore, New York, upon the ground that “ The applicants have failed to establish that if this application for removal is granted there will be sufficient number of liquor stores in the vicinity in which they are now located to serve public convenience and advantage in this area and the Board further determines that public convenience and advantage will not be served by the approval of application.”

There are four package liquor stores in the vicinity of the premises of these licensees in Franklin Square, and three package liquor stores in the area to which the licensees wish to move. Although the objections to this removal have been sustained which were filed by the package liquor store proprietors in the area to which appellants have applied to move, the Authority has admittedly made no inquiry into and no findings concerning whether the proposed area to which petitioners wish to move is' adequately served by liquor stores. In ruling upon such applications, the State Liquor Authority is required by statute to consult the convenience and advantage of the public, but the Authority has made no investigation into whether the public convenience and advantage in the proposed new area in Forest City, North Bellmore, would be promoted or adversely affected by the change in location of their package liquor store which appellants seek. For aught that, appears to the contrary, the public convenience and advantage of the people in the proposed new location might be advantaged to an extent which would far outweigh any detriment to the area from which they wish to withdraw. We do not hold that such is necessarily the case, but merely that the State Liquor Authority could not intelligently exercise its statutory power to rule upon the removal application without ascertaining and considering the public convenience and advantage of the proposed new area as well as that of the old. That is especially true where, as here, the objections which were tried and sustained by the Authority were made by other package liquor stores in the new area. These objections could

p. 364

hardly be tried without consideration of the conditions existing in both areas. Subdivision 6 of section 121 of the Alcoholic Beverage Control Law authorizes court review of ‘‘ The transfer by the liquor authority of a license or permit to any other premises or the failure or refusal by the liquor authority to approve such a transfer.”

Not only is there no finding in regard to how the public in the new area are circumstanced in regard to the purchasing of liquor but it was also conceded and urged upon the argument by counsel for the Authority that it had not considered and was not required by law to consider what the circumstances in the proposed new area are or would be if the petition were granted. It was arbitrary and capricious for the Authority to decide whether this removal of petitioners’ store should be granted or denied without looking into conditions in the new area. This was inconsistent with the circumstance that notices were sent by the Authority to the package liquor stores closest to such proposed new location, all of which filed protests. If the circumstances existing in the new location did not need to be investigated or considered, it was an idle gesture to have sent notices to the package liquor stores in that area, nor, under the Authority’s theory of the law, should their protests have been received or accorded weight. No protests were interposed by liquor stores in the area proposed to be vacated by petitioners but the proprietors of the stores in the new area were evidently objecting to any increase in competition in their locality. The record is left in the anomalous state that the Authority never tried out the basis for the objections which were filed.

We do not substitute the judgment of the court for that of the Authority, but it was required to consider the convenience of the people of the area of the new location as well as of the old. Public convenience and advantage requires a comparison of the situations existing in both areas in order to determine whether or not the change should be permitted.

The matter should be remitted to the State Liquor Authority to investigate, consider and make findings in relation to the situations in both localities in ruling upon whether public convenience and advantage calls for the granting or denial of this removal petition.

p. 365

Judges Fuld, Burke and Bergan concur with Judge Van Voorhis; Chief Judge Desmomd and Judges Dye and Scileppi dissent and vote to affirm.

Order reversed, with costs in this court and in the Appellate Division, and the matter remitted to the State Liquor Authority to make findings in accordance with the opinion herein.

Cases cited

Elite Dairy Products, Inc. v. Ten Eyck 271 N. Y. 488 N.Y. 1936-07-08 p. 361
New York Water Service Corp. v. Water Power & Control Commission 283 N. Y. 23 N.Y. 1940-04-23 p. 361
People ex rel. Hultman v. Gilchrist 114 Misc. 651 N.Y. Sup. Ct. p. 361
Wager v. State Liquor Authority 4 N Y 2d 465 N.Y. 1958-06-25 p. 362
Rockower v. State Liquor Authority 4 N Y 2d 128 N.Y. 1958-03-27 p. 362, p. 363
Fink v. Cole 1 N Y 2d 48 N.Y. 1956-03-22 p. 362
Colgate-Palmolive-Peet Co. v. Joseph 308 N. Y. 333 N.Y. 1955-03-11 p. 362
Kilgus v. Board of Estimate 308 N. Y. 620 N.Y. 1955-06-09 p. 362
Joseph Burstyn, Inc. v. Wilson 303 N. Y. 242 N.Y. 1951-10-18 p. 362
Fiore v. O 'Connell 297 N. Y. 260 N.Y. 1948-03-19 p. 362
Stracquadanio v. Department of Health 285 N. Y. 93 N.Y. 1941-03-06 p. 362
Kaplan v. O'Connell 305 N. Y. 850 N.Y. 1953-07-14 p. 362
Restaurants & Patisseries Longchamps, Inc. v. O'Connell 296 N. Y. 888 N.Y. 1947-02-28 p. 362
Federal Communications Commission v. Woko, Inc. 329 U. S. 223 SCOTUS 1946-12-09 p. 362
Commercial Pictures Corp. v. Board of Regents 305 N. Y. 336 N.Y. 1953-05-28 at 346 p. 362
Glintenkamp v. O'Connell 296 N. Y. 806 N.Y. 1947-01-09 p. 362
Snetlage v. O'Connell 297 N. Y. 707 N.Y. 1947-11-20 p. 362
Watinsky v. O'Connell 297 N. Y. 552 N.Y. 1947-07-02 p. 362
Taub v. Pirnie 3 N Y 2d 188 N.Y. 1957-07-03 p. 362
Town of Waterford v. Water Pollution Control Board 5 N Y 2d 171 N.Y. 1959-01-22 p. 362
Schwartz v. Falk 5 A D 2d 46 N.Y. App. Div. 1957-12-19 p. 362
Barry v. O'Connell 303 N. Y. 46 N.Y. 1951-07-11 p. 362
France v. O'Connell 204 Misc. 681 N.Y. Sup. Ct. 1953-10-14 p. 362

Statutes and regulations cited

Alcoholic Beverage Control Law p. 362, p. 364