Chili's of Jonesboro, Inc. v. State Alcohol Beverage Control Division

57 S.W.3d 228, 75 Ark. App. 239, 2001 Ark. App. LEXIS 712
CourtCourt of Appeals of Arkansas
DecidedOctober 17, 2001
DocketCA 01-366
StatusPublished
Cited by6 cases

This text of 57 S.W.3d 228 (Chili's of Jonesboro, Inc. v. State Alcohol Beverage Control Division) is published on Counsel Stack Legal Research, covering Court of Appeals of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chili's of Jonesboro, Inc. v. State Alcohol Beverage Control Division, 57 S.W.3d 228, 75 Ark. App. 239, 2001 Ark. App. LEXIS 712 (Ark. Ct. App. 2001).

Opinion

BIRD, Judge.

The Director of the Alcohol Beverage Control Division denied private-club permits to Chili’s of Jonesboro, Inc., and Outback Steakhouse of Jonesboro, Inc., both of which wished to locate in Jonesboro. The restaurants appealed to the Alcohol Beverage Control Board where the hearings on the applications were consolidated, with the evidence relating to one of the applications relating to both. The Board denied the permits, finding that issuing the permits was not in the public interest of Jonesboro citizens because of the strong opposition to the clubs, that the restaurants would not be operated for a private-club purpose, that the intersection near the proposed site was dangerous, and that Craighead County was a dry county. On appeal to the circuit court, the Board’s decision was affirmed and the restaurants now appeal, contending that the decision of the Board was not supported by substantial evidence. Because we find that the Board’s decision is supported by substantial evidence, we affirm.

On appeal, our review is directed, not toward the circuit court, but rather toward the decision of the agency. Arkansas State Hwy. & Transp. Dep’t v. Kidder, 326 Ark. 595, 933 S.W.2d 794 (1996). The decision of the Board should be upheld if it is supported by substantial evidence and is not arbitrary, capricious, or characterized by an abuse of discretion. Department of Fin. & Admin. v. Samuhel, 51 Ark. App. 76, 909 S.W.2d 656 (1995). An administrative decision should be reversed as arbitrary and capricious only when it is not supportable on any rational basis, not simply because the reviewing court would have acted differently. McKinley v. Arkansas Dep’t. of Human Servs., 311 Ark. 382, 844 S.W.2d 366 (1993). Determining whether the Board’s decision was arbitrary or capricious involves a limited inquiry into whether it acted with willful and unreasoning disregard of the facts and circumstances of the case. Fontana v. Gunter, 11 Ark. App. 214, 669 S.W.2d 487 (1984).

The reviewing court is to give the evidence its strongest probative force in favor of the agency’s ruling. State Police Comm’n v. Smith, 338 Ark. 354, 994 S.W.2d 456 (1999). The question on review is not whether the evidence would have supported a contrary finding but whether it supports the finding that was made. Fontana, supra. The reviewing court cannot displace the Board’s choice between two fairly conflicting views even though the court might have made a different choice had the matter been before it de novo; and the question of whether the Board’s action was arbitrary or capricious is only applicable when the decision is not supported by any rational basis and is made in disregard of the facts and circumstances. Id. A reviewing court may not set aside a Board?s decision unless it cannot conscientiously find from a review of the entire record that the evidence supporting the decision is substantial. Id. To establish an absence of substantial evidence it must be demonstrated that the proof before the administrative tribunal was so nearly undisputed that fair-minded persons could not reach its conclusions. Kidder, supra.

The burden is on the applicant to show that he is “qualified” to hold the permit and that issuance of the permit is “in the public interest,” whereupon the Board “may” issue the permit. Arkansas Beverage Control Bd. v. King, 275 Ark. 308, 629 S.W.2d 288 (1982). The threshold question that must be considered by the Board is whether the private-club applicant will be “qualified”; thus, necessarily it must be determined whether the proposed club will meet the definition of a private club. In order to qualify as a private club, a nonprofit corporation must be established for a recreational, social, patriotic, political, national, benevolent, athletic, or other nonprofit purpose other than the consumption of alcoholic beverages. See Ark. Code Ann. § 3-9-202(10) (Repl. 1996). Bruce Attinger, a joint venturer associated with Outback, testified that the common purpose of the private-club members would be “[sjocial eatery, I guess, enjoying food, and camaraderie.” Additionally, Kim Williams, senior development manager for Brinker International, the holding company for Chili’s restaurants, testified that the employees of Chili’s restaurants are permitted to choose a charity that the restaurant will support in the local community, and that, statewide, Chili’s restaurants serve as drop-off points for the Toys for Tots program. Bruce Attinger testified that Outback’s local partner selects a local charity to support and that Outback was very involved on the national level with the Boys and Girls Club, hosting fundraising dinners.

In King, supra, the supreme court affirmed the denial of a private-club permit because the private club did not meet the requisite statutory purpose. The purpose of that club was described in testimony as “[a] social gathering for people to come to, to enjoy food with a drink . . Id. The Board found that “[t]he proposed club . . . would have no other purpose other than the consumption of alcoholic beverages.” In King, the club argued that because its private-club charter recited the words of the statute as to the required purpose, the requisite purpose element of Ark. Code Ann. § 3-9-202(10) had been met. The supreme court disagreed, stating that “if we should hold that the mere compliance with the statute for the existence of the charter was sufficient to entitle the applicant to a mixed drink permit, then the Board has no discretionary powers and, therefore there is no need for the Board.” Id.

In the present case, appellants are making essentially the same argument that was made by the applicant in King. It is appellants’ contention that because the clubs would be created for the purpose of providing a social eatery, where its members could enjoy food and camaraderie, and because the clubs would be a nonprofit corporation whose employees would be civically involved through charitable donations, then the requisite purpose is met. Consistent with the supreme court’s holding in King, we reject “social eatery, enjoying food, and camaraderie” as a private-club purpose that complies with the requirements of Ark. Code Ann. § 3-9-202(10) (Repl. 1996).

We reject as well the appellants’ contention that its charitable contributions constitute a qualified purpose within the meaning of Ark. Code Ann. § 3-9-202(10). We note that the testimony of Kim Williams only established that the employees of Chili’s restaurant would be permitted to select a local charity to which the restaurant would contribute. We further note that the testimony of Bruce Attinger only established that Outback’s local partner would be permitted to select a local charity to which the restaurant would contribute. There was no testimony that the employees of Chili’s or the local partner of Outback, who would be making these charitable selections, would be members of the private clubs.

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Bluebook (online)
57 S.W.3d 228, 75 Ark. App. 239, 2001 Ark. App. LEXIS 712, Counsel Stack Legal Research, https://law.counselstack.com/opinion/chilis-of-jonesboro-inc-v-state-alcohol-beverage-control-division-arkctapp-2001.