Delaware Alcoholic Beverage Control Commission v. Newsome

690 A.2d 906, 1996 Del. LEXIS 227, 1996 WL 335978

• Court: Supreme Court of Delaware
• Decided: June 7, 1996
• Docket: 309, 1995
• Status: Published

Opinions

HOLLAND, Justice: for the majority.

This is an appeal from a final judgment of the Superior Court. That judgment reversed a decision of the Alcoholic Beverage Control Commission (“Commission”). The Commission had granted the application of the appellant, Wal-Mart Stores, Inc., i/a Sam’s Club # 6330 (“Sam’s”), for a package store license to sell alcoholic beverages for off-premises consumption at 1572 North du-Pont Highway, Dover, Delaware. The appel-lees, Larry Newsome, Gil Thompson and Rob Carter (“Protesters”), are several area liquor store owners who oppose the application.

Delaware prohibits the sale of alcoholic beverages on the premises of a grocery store. 4 Del.C. § 516(a). The Superior Court concluded that Sam’s application was within the scope of that statutory prohibition. On that basis, the Superior Court reversed the decision of the Commission to grant the license to Sam’s.

Sam’s has raised two contentions in this appeal. First, Sam’s argues that the Superi- or Court erred in concluding that its warehouse was a grocery store. Alternatively, Sam contends that the Superior Court erred in ruling that it had applied for a license to sell alcoholic beverages on its grocery store (warehouse) premises.

This Court has determined that the Superior Court properly concluded that Sam’s warehouse is a grocery store. Conversely, this Court has concluded that Sam’s did not apply for a license to sell alcoholic beverages on its grocery store (warehouse) premises. Accordingly, the judgment of the Superior Court is reversed.

Facts

On January 30, 1992, Sam’s filed an application to locate a 1500-square foot package store in front of its existing warehouse store. Both are located on a 21-acre parcel of land, along with a Wal-Mart store. The land is located west of Route 13, on the north side of Dover.

In response to Sam’s application, the Commission received a protest from several area liquor store owners. It conducted a hearing on July 23,1992. The Commission concluded that the new package store proposed by Sam’s would serve the public need and convenience. On October 29,1992, the Commission granted Sam’s application to sell alcoholic beverages for off-premises consumption.

The Protesters appealed the Commission’s decision to the Superior Court. On June 14, 1993, the Superior Court remanded the matter to the Commission for further findings of fact. Inter alia, the Commission was directed to determine whether Sam’s was an appropriate applicant for a liquor license.

On August 12, 1993, the Commission issued an opinion in which it summarized the prior evidence and made additional findings of fact, in pertinent part, as follows:

14. The package store for off-premises consumption, if the application is granted, will have a separate facility in the front of the building with a separate entrance from Sam’s Club [warehouse] as required by Commission rules.

H* * * H* * H:

18. Although there will be a common wall with Sam’s other buildings, there will be no entrance from the existing Sam’s Club [warehouse] with over 1500 square feet of floor space in compliance with the Commission rules.

19. The package store will not be a grocery store but a bona fide package store for off-premises consumption approved by the Enforcement Section.

The Commission concluded that “Sam’s is a proper applicant for a package store license and is not a grocery store which would otherwise operate in contravention of the Liquor Control Act.” The Protesters again appealed to the Superior Court. The Commission’s decision was reversed.

Grocery Store Defined Liquor License Prohibition

For almost fifty years, it has been unlawful in Delaware for any owner, lessee or manager conducting a grocery store, delicatessen or cigar store to sell or dispense alcoholic liquors on its premises. 42 Del. Laws c. 186. The present statute states, in pertinent part:

§ 516. Consumption off premises of hotel, restaurant, club, store or taproom,

(a) Any person in charge of a hotel, restaurant, club or store (other than a grocery, delicatessen or cigar store), whether owner, lessee or manager, and recognized as such by the Commission, may apply to-the Commission for a license to purchase and to keep and sell and deliver on the premises only spirits, wine or beer by the bottle or half bottle only, but not for consumption on the premises where sold, or in any dependency thereof.

4 Del. C. § 516(a) (emphasis added).

Sam’s argues that it is not a grocery store, but rather a “no-frills, working warehouse.” Sam’s presented evidence that it carries over three thousand brand-name items, including office supplies, appliances, home furnishings, clothing and jewelry. Sam’s argues that a grocery store does not have this type of inventory. Nevertheless, Sam’s acknowledges that food items comprise the bulk of its sales.

The term “grocery store” is not defined by statute. Undefined terms in a statute are construed according to their common and approved usage. Moore v. Wilmington Housing Authority, Del.Supr., 619 A.2d 1166, 1178 (1993). A “grocery” is defined as “the place of business of a retail grocer.”¹ “Grocer” is defined as a “dealer in staple foodstuffs (as coffee, sugar, flour) and usually meats and other foods (as fruits, vegetables, dairy products) and any household supplies (as soap, matches, paper napkins).”²

The Superior Court concluded the fact that Sam’s is unlike a traditional corner grocery store is not determinative of its legal status. For purposes of the statutory prohibition, the Superior Court construed the word “grocery” according to its ordinary and common meaning. The Superior Court held that a store such as Sam’s, which sells mostly food items for take-home personal use, is a grocery store.

The Superior Court properly decided to attribute the commonly understood meaning to the word “grocery.” The Superior Court’s conclusion that Sam’s warehouse is a grocery store is supported by the record. Accordingly, the Superior Court’s ruling that Sam’s warehouse is a grocery store was the product of a logical and deductive reasoning process.

Grocery Store Prohibition Premises Not Status Controls

The Superior Court then held that the Commission erred, as a matter of law, when it permitted Sam’s to apply for a package store license. In explaining its holding, the Superior Court stated that: “the license issued to Sam’s contravenes the clear legislative intent expressed in 4 Del. C. § 516(a) to exclude grocery stores as eligible licensees.” The relevant portion of the statute reads as follows:

(a) Any person in charge of a ... store (other than a grocery ... store), ... may apply ... for a license to purchase and to keep and sell and deliver on the premises only spirits, wine or beer....

4 Del.C. § 516(a) (emphasis added).

Sam’s argues the words “on the premises only” mean that no person conducting a grocery store business may apply for a license to sell alcohol on the premises of said grocery store. Thus, Sam’s contends, a person conducting a grocery store business is not prohibited per se from applying for a package store license on premises other than the grocery store premises. In support of its position, Sam’s relies upon United Cigar-Whelan Stores Corp. v. Delaware Liquor Commission, Del.Gen.Sess., 15 A.2d 442 (1940).

In United Cigar, the issue addressed in the context of a predecessor statute was whether cigar store owners were, as a class, prohibited per se from obtaining a license for a package store:

Now the question to be determined is whether the legislature intended to prohibit a lessee conducting a cigar store from selling or dispensing alcoholic liquor anywhere in the State of Delaware, or whether the sale or dispensing of such liquor was intended to be prohibited solely in the cigar stores so conducted by said lessee. If it was intended that the prohibition of sale should be state-wide in character it is very difficult, if not quite impossible, to attribute any reasonable meaning to be given to the qualifying word “conducting.”

Id. at 445.

The present statute precludes the sale of alcoholic beverages on the same premises by a grocery store, delicatessen, or cigar store. Although the word “conducting” has been replaced by the phrase “in charge of,” the ratio decidendi in United Cigar remains persuasive. This Court holds that any person in charge of a grocery store, delicatessen, or cigar store is not statutorily prohibited per se from acquiring a license to sell alcoholic beverages on a different premises.

Grocery Premises Defined Liquor License Prohibition

Consequently, the definitive issue in this case is what constitutes the prohibited premises, i.e., does Sam’s intend to sell alcoholic beverages on the premises of its grocery store or on another premises. The Superior Court ruled that the “Commission cannot, under the guise of its administrative authority, include a grocery store such as Sam’s within the eligible class of licensees for off-premises licenses by drawing an artificial distinction between the package store and Sam’s itself.” The Superior Court’s characterization of the separation between Sam’s warehouse and package store as “artificial” is attributable to the fact that the parties did not provide the Superior Court with the Commission’s definition of the word “premises.”

Although the word “premises” is not defined by statute, it is defined in the rules³ of the Commission, as follows:

“Premises” shall mean the building or buildings identified by a single address number or lease space number, to which a license to sell alcoholic liquors for consumption “on” or “off’ has been issued by the Commission, but shall not include the surrounding grounds, parking lot, ancillary structures, contiguous water, still or moving, or piers, floating docks or buildings, patios covered or uncovered, or any other structure, modular or mobile home attached or connected to the licensed establishment by electrical, water, sewer or heating/air conditioning systems.

The Commission carefully considered the physical layout of the package store “premises” it was being asked to license. The Commission concluded that granting Sam’s application would not result in the sale of alcohol on the premises of a grocery store, i.e., Sam’s warehouse. The Commission made the following findings of fact:

— The package store for off premises consumption, if the application is granted, will have a separate facility in the front of the building with a separate entrance from Sam’s Club as required by Commission rules.

— The size of the package store shall be 17 feet wide by 90 feet long as depicted on the floor plan approved by the Enforcement Section, Agent James McNair of the Division of Alcoholic Beverage Control.

— Although there will be a common wall with Sam’s other buddings, there will be no entrance from the existing Sam’s Club with over 1500 square feet of floor space in compliance with Commission rules.

— Agent McNair determined that the General Provisions application to all licensees including, but not limited to, the hours of operation, an accurate floor plan, proper storage facilities, the requirement that no connecting door be located between licensed and unlicensed premises, proper retail license and approved name have been fully complied with by Sam’s.

— The budding plans submitted by Sam’s as wed as the changes documented in the letter dated July 29,1993 have been approved by the Division of Alcoholic Beverage Control.

— The public shad be able to patronize Sam’s package store and no membership cards wid be required for patrons.

— The package store wid not be a grocery store but a bona fide package store for off-premises consumption approved by the Enforcement Section.

On appeal from a decision of the Alcohodc Beverage Control Commission, the reviewing court must examine the record to determine whether or not the Commission’s findings are based on substantial evidence. Delaware Alcoholic Beverage Control Commission v. Alfred I. duPont School Dist., Del.Supr., 385 A2d 1123, 1125 (1978); Down Under, Ltd. v. Delaware Alcoholic Beverage Control Commission, Del.Super., 576 A.2d 675, 681 (1989); 4 Del.C. § 541(c). Substantial evidence means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. Oceanport Ind., Inc. v. Wilmington Stevedores, Inc., Del. Supr., 636 A.2d 892, 899 (1994). The appellate court does not weigh the evidence, resolve questions of credibility, or make its own factual findings. Johnson v. Chrysler Corp, Del.Supr., 59 Del. 48, 213 A.2d 64, 66 (1965). It merely determines if the evidence is legally adequate to support the agency’s factual findings. 29 Del.C. § 10142(d).⁴

The physical layout of Sam’s package store and the Sam’s warehouse facility is similar to that of many shopping centers, where different mercantile activities are separated by party walls. The record evidence is legally adequate to support the Commission’s ultimate factual finding that granting Sam’s application would not result in the sale of alcoholic beverages on the premises of a grocery store.

Conclusion

The Commission’s decision to grant Sam’s application should have been affirmed. The judgment of the Superior Court is reversed.

1 . Webster's Third New International Dictionary 1001 (1981).

2 . Id.

3 . Delaware Alcoholic Beverage Control Conunission Rule 42.1(B)(1).

4 . The Commission's proceedings and any appeals therefrom are governed by the Administrative Procedures Act. 29 Del.C. § 10161(a)(1). The Act specifies that this Court’s role is limited to determine whether the Commission’s decision was supported by substantial evidence on the record. 29 Del.C. § 10142(d).