Martin v. Alcoholic Beverage Control Appeals Board

341 P.2d 291, 52 Cal. 2d 259, 1959 Cal. LEXIS 199
California Supreme Court·Decided June 2, 1959·No. L. A. No. 24698·Published·Cited by 17 cases

Opinion

SPENCE, J.

This is an appeal by the Alcoholic Beverage Control Appeals Board (hereinafter called the Appeals Board) from a judgment of the trial court granting a writ of mandate directing the Appeals Board to affirm the decision of the Department of Alcoholic Beverage Control (hereinafter called the Department) denying transfer of a general on-sale liquor license to Ronald C. Chaney (hereinafter called the applicant). The Appeals Board had reversed the decision of the Department, and a motion to dismiss its appeal from the judgment of the trial court was heretofore denied upon the ground that the Appeals Board “is aggrieved by the judgment and entitled to appeal.” (Munro v. Alcoholic Beverage Control Appeals Board, 50 Cal.2d 863, 864 [326 P.2d 506].)

Several of the procedural questions arising under the 1954 amendment of article XX, section 22, of the Constitution have been recently determined by this court in Martin v. Alcoholic Beverage Control Appeals Board, Sac. 7040, ante, page 238 [340 P.2d 1], Our discussion in that case of the broad discretionary powers vested in the Department and of the limited powers vested in the Appeals Board need not be repeated here. We therefore proceed directly to a statement of the factual background of this controversy.

The applicant filed an application and affidavit with the Department for the transfer of an on-sale general alcoholic beverage license. The affidavit form called for “a full, true, and correct statement of all violations of any of the Penal Laws of the State of California or of any other State, or of the United States, for which he has been arrested, or of which he has been convicted, or to which he has pleaded guilty, or for which he has suffered imprisonment, payment of a fine, or the receiving of a suspended sentence or probation.” There followed the question: “Have you ever been arrested?-If the answer is ‘yes’ state below in your own handwriting ANY and ALL arrests.” In response to this query, the applicant set forth his arrest in Hollywood in 1946 for a “fight,” for which he had been placed on “probation”; but he failed to mention an arrest and conviction of larceny in 1949 in Memphis, Tennessee, for which he had served 60 days at a penal [262]*262farm and had been fined $10. An agent of the Department discovered this Tennessee conviction in the course of investigating the application, and the transfer was denied. The applicant petitioned for a hearing before the Department. After the hearing, the Department adopted the findings of the hearing officer reciting that “petitioner failed to include or mention the [1949 Tennessee] arrest and conviction”; that petitioner thereby “misrepresented a material fact on his application”; and that the “issuance of the license would be contrary to public welfare and morals.”

The applicant appealed to the Appeals Board. The board determined, in accord with the applicant’s contention, that the findings of the Department did not support the decision denying a license in that there was no finding that the applicant knowingly or purposely omitted the fact of arrest in Tennessee, the finding being that there was a failure to include or mention the arrest; that for all that appeared, the omission was unintentional, resulting from an honest mistake or negligence ; that the evidence would not support such a finding had one been made; that upon questioning, the applicant openly and frankly admitted the arrest and fully disclosed all the circumstances surrounding it; that the applicant testified it was his belief that only arrests occurring in California were required to be listed, and had he understood the application more clearly, he would have listed the Tennessee arrest. The Appeals Board concluded that the unintentional or careless omission of the arrest did not constitute good cause under section 22 of article XX of the Constitution for denial of a license; and further, that the two arrests considered together were not of sufficient materiality to furnish a reasonable basis on which to deny a license. Accordingly, the Appeals Board reversed the decision of the Department.

The director of the Department then filed in the superior court a petition for a writ of mandate. The court found that there was substantial evidence to support the Department’s finding that the applicant misrepresented a material fact on his application, and that the transfer of a license to him would be contrary to public welfare under section 22 of article XX of the Constitution; that the decision of the Department denying the transfer because of such misrepresentation constituted a proper exercise of the Department’s discretion; that the decision of the Appeals Board was arbitrary in that it substituted its own discretion for that of the Department; that the Appeals Board incorrectly determined the issues and acted [263]*263“contrary to law” in the matter in that the findings of the hearing officer and the Department were supported by substantial evidence in the light of the whole record; and that the suppression by the applicant of the 1949 conviction constituted a good cause for denial of his application. The ensuing judgment granted a writ of mandate directing the Appeals Board to affirm the Department’s denial of a license, and the Appeals Board has appealed from that judgment.

Basically, this controversy presents questions concerning the respective powers and functions of the Department and the Appeals Board similar to the questions presented in Martin v. Alcoholic Beverage Control Appeals Board, supra, ante page 238. Here, however, the Appeals Board purported to reverse the decision of the Department upon two separate grounds: (1) its determination that the findings of the Department did not support the Department’s decision, and (2) its determination that the evidence would not sustain the necessary findings to support the Department’s decision. The propriety of the Appeals Board’s reversal therefore depends upon (1) whether the Department made a sufficient finding of the essential ultimate fact or facts; and (2) if so, whether there was substantial evidence before the Department to sustain such finding of the essential ultimate fact or facts.

Insofar as pertinent here, the above-mentioned 1954 amendment provides: ‘ The department shall have the power, in its discretion, to deny, suspend or revoke any specific liquor license if it shall determine for good cause that the granting or continuance of such license would be contrary to public welfare or morals, or that a person seeking or holding a license has violated any law prohibiting conduct involving moral turpitude. . . .”; and that “Review by the board of a decision of the department shall be limited to the questions . . . whether the decision is supported by the findings, and whether the findings are supported by substantial evidence in the light of the whole record.” In this connection, the Appeals Board calls our attention to section 11518 of the Government Code, which provides: “The decision [of the Department] shall be in writing and shall contain findings of fact, a determination of the issues presented and the penalty, if any. The findings may be stated in the language of the pleadings or by reference thereto. Copies of the decision shall be delivered to the parties personally or sent to them by registered mail.”

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Martin v. Alcoholic Beverage Control Appeals Board, 341 P.2d 291, 52 Cal. 2d 259, 1959 Cal. LEXIS 199 (Cal. 1959).

341 P.2d 291 (Martin v. Alcoholic Beverage Control Appeals Board) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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