Re: Deann, Inc., dba The Lion’s Den
Premises: 90 Ocean Avenue
City/Town: Revere, MA 02151
License: AB-Rest
Heard: August 18, 2004

MEMORANDUM AND ORDER

This was a hearing before the Alcoholic Beverages Control Commission (“the Commission”) on the appeal of Deann Inc., d/b/a The Lion’s Den (“the Lion’s Den”) from the action of the local licensing authority for the City of Revere (“Local Board”) in revoking the annual, all alcoholic beverages restaurant license of The Lion’s Den. The Lion’s Den and the Local Board submitted a Special Request for Informal Summary Disposition on Stipulated Facts.

The issues presented were: (1) whether the licensee’s ability to receive “sufficient notice of the issues involved to afford them reasonable opportunity to prepare and present evidence and argument” as required by M.G.L. c. 30A, § 11(1) was prejudiced by the Local Board’s inadequate notice of hearing; and, (2) whether the Local Board violated the licensee’s substantive due process rights by the revocation of the alcoholic beverages license prior to the Commission’s appeal decision.

After consideration of the positions presented by the parties, the Commission disapproves the action of the Local Board and remands the matter to the Local Board as specified below.

FACTS

On or about April 4, 2004 a patron sustained a leg injury on the licensed premises and was later shot outside the premises. The manager of the Lion’s Den, Mr. Chin, failed to call any emergency medical responders and report the injury to the patron.

The Local Board on April 7, 2004 sent the licensee a notice of hearing (Exhibit 1). The Notice stated, “[n]otice is hereby given that the Revere License Commission has scheduled a hearing for Monday evening, April 26, 2004 regarding the major incident that occurred in or around your premises indicating lack of management. This hearing will consider whether you have violated the laws, rules and regulations pertaining to your alcoholic beverages, common victualler and entertainment licenses. In addition, at the same time, the License Commission will hear evidence as to the public need for your licensed premises to remain open until 2:00 am.”

On April 27, 2004, the Local Board sent the licensee a letter stating the reasons for its decision (Exhibit 2). The letter states, in pertinent part, that “[b]ased upon the evidence presented at the hearing, the Commission makes the following findings of facts:
Deann Inc., d/b/a The Lion’s Den is the holder of a 2:00 am AB license located at 90 Ocean Avenue, Revere, MA.
David Chin is the manager of said license.
The license was renewed for calendar year 2004 in November 2003.
The Revere Police Department Report stated that they responded to a shooting at 90 Ocean Avenue at the Lion’s Den. This was substantiated by a testimony from the Revere Police Department.
The Revere Police Department testimony stated that the manager of record, David Chin, of ‘The Lion’s Den did not call for emergency medical aid, (911) after he had been told by patrons that someone was stabbed and shot. Also, an 18 year-old female reported that she had been served alcoholic beverages by the licensee in this club.’

Based on the above findings, this Board voted to revoke the Alcoholic Beverages, Common Victualler and Entertainment License of The Lion’s Den; and also decrease the hours of operation from 2:00 a.m. closing to 11:00 p.m. closing effective immediately.”

DISCUSSION

First Issue. The licensee argued that the Local Board’s notice did not adequately inform them of the charges. The Local Board notice stated that a hearing had been scheduled “regarding the major incident that occurred in or around the premises indicating lack of management.” By a plain reading of the notice the Commission finds that the licensee did not have any notice of what the major incident was, when it occurred, or who was involved. The Commission is persuaded and finds that this part of notice is insufficient on its face.

The Local Board notice also stated “this hearing will consider whether you violated the laws, rules and regulations pertaining to your alcoholic beverages, common victualler and entertainment license.” The Local Board notice did not cite the law, be it a statute, Commission regulation or local rule alleged to be violated. The Local Board notice did not inform of any specific law alleged to have been violated. One of the charges was later identified at the Local Board hearing as serving a person under the age of 21 years old. This charge is a violation under Ch.138, §34 and carries with it serious consequences. The licensee’s first opportunity to learn of the specific allegation and defend against this charge was at the Local Board hearing on April 26, 2004. This type of notice and hearing does not persuade the Commission that the Local Board process was fair or reasonable. The Local Board’s process in this case also would never stand, or be held by this Commission, as a paradigm of due process.

The Supreme Judicial Court addressed the issue of a defective process being conducted by a Local Board. In Aristocratic Restaurant Of Massachusetts, Inc. v. Alcoholic Beverages Control Commission (No. 1), 374 Mass. 547, 374 N.E.2d 1181 (1978), the SJC held that a notice of hearing that did not specify a date of the alleged violation was inadequate. The SJC further held that a notice is procedurally defective if the notice is “inadequate to provide the licensees with ‘sufficient notice of the issues involved to afford them reasonable opportunity to prepare and present evidence and argument.’ (G.L. c. 30A, s 11(1) [legislative citation omitted].)” Aristocratic Restaurant, 374 Mass. at 551; 374 N.E. 2d at 1184. A Commission decision made after such inadequate, unsupplemented notices of hearing being issued was held to be based on unlawful procedure. Id. citing G.L. c. 30A, s 14(7)(d). “However, only where ‘the substantial rights of any party may have been prejudiced’ is a reversal of agency action appropriate. G.L. c. 30A, s 14(7).” Aristocratic Restaurant, 374 Mass. at 551; 374 N.E. 2d at 1184. In this case, the licensee argues, and the Commission is persuaded and finds, that this defective process prejudiced the substantial rights of the licensee.

As found above, the licensee did not have any notice of what the major incident was, when it occurred, or who was involved. The Commission notice of hearing did not furnish any more specific facts to supplement the local board’s defective notice. Therefore, the Commission concludes that neither the licensee nor its legal counsel, if any, “was adequately prepared to meet the evidence presented before the commission”, Aristocratic Restaurant, 374 Mass. at 551; 374 N.E. 2d at 1184, and that the licensee suffered prejudice as a result of the local board’s procedural defect in its hearing notice. The Commission notes that a “reasonable opportunity to prepare and present evidence and argument” as required by G.L. c. 30A, § 11(1) as well as “notice to the licensee and reasonable opportunity for him to be heard” as required by G.L. c. 138, § 64 and a “hearing or opportunity therefore” as required by G.L. c. 138, § 23 each include at least the element of “an opportunity to call their own witnesses and cross examine the opposing witnesses in reasonable fashion.” Foster From Gloucester, Inc. v. City Council of Gloucester, 10 Mass.App.Ct. 284, 292, 407 N.E.2d 363, 368 (1980).

The Commission finds no need to address the issue of whether the local board’s submission of evidence on the merits was sufficient evidence to find, as alleged, a lack of management or a violation of any law because the procedural defects prejudiced the licensee’s ability to receive “sufficient notice of the issues involved to afford them reasonable opportunity to prepare and present evidence and argument” as required by M.G.L. c. 30A, § 11(1).1

Second Issue. The licensee also argued that the Local Board violated its substantive rights by revoking its alcoholic beverages license prior to its appeal to the ABCC, and as a result the licensee was forced to get a Superior Court Injunction. The Commission speaks only to the action of the Local Board regarding the alcoholic beverages license. The Commission leaves it to the courts to rule on the propriety of the Local Board action regarding both the common victualler license and entertainment license issued pursuant to the pertinent provisions of M.G.L. c. 140. Black Rose, Inc. v. Boston, 433 Mass. 501, 503, 744 N.E.2d 640, 642 (2001) (“Because G. L. c. 140, § 183A, contains no provision for judicial review of a decision of the licensing board, and because it is not a State ‘agency’ within the meaning of the State Administrative Procedure Act, G. L. c. 30A, § 1 (2), see Saxon Coffee Shop, Inc. v. Boston Licensing Bd., 380 Mass. 919, 922-924 (1980) (concluding that licensing board is not State agency), judicial review is only available by civil action for relief in the nature of certiorari, pursuant to G. L. c. 249, § 4. See Caswell v. Licensing Comm'n for Brockton, 387 Mass. 864, 876-877 (1983).”)

The plain language of M.G.L. c. 138, § 67 provides, in pertinent part, that “[p]ending a decision on the appeal, the action of the local licensing authorities shall have the same force and effect as if the appeal had not been taken.” With this plain language of the statute, there is no automatic stay of enforcement pending an appeal to the Commission. While a single footnote that exists that may be fairly characterized as dicta2, the Commission has found no reported appellate decision, and none was cited, that holds that the holder of an alcoholic beverages license under Chapter 138 of the General Laws has the right to a stay of enforcement of a local board discipline pending appeal to the Commission, notwithstanding the plain language of M.G.L. c. 138, § 67. Without such a right, there is no violation of any alleged substantive due process rights by the enforcement of a revocation by a local board prior to a Commission decision on appeal.

Finally, the Commission has no jurisdiction to rule on the propriety of the Local Board’s action to roll back the hours of operation to 11:00 p.m. Casa Loma, Inc. v. ABCC, 377 Mass. 231, 385 N.E.2d 976 (1979). The Commission acknowledges that the Supreme Judicial Court in Casa Loma held a rollback of hours does not constitute a “modification” of a license within the meaning of M.G.L. c. 138, §§ 12, 23, 64 or 67.

DISPOSITION AND ORDER

Based on the findings and rulings above, the Alcoholic Beverages Control Commission finds that the process the Local Board conducted in this case was unfair. The Commission disapproves the action of the Local Board in finding the licensee committed a violation. The Commission remands the matter to the Local Board with the recommendation that no modification, suspension, revocation or cancellation of the license be ordered by the Local Board.

The Commission further recommends that in the future the Local Board issue adequate written notices of hearing that furnish a fair description of the allegations for which a licensee will be held to account and thereby afford a licensee with a reasonable opportunity to be heard that complies with the Local Board’s legal obligations.

ALCOHOLIC BEVERAGES CONTROL COMMISSION

Eddie J. Jenkins, Chairman ________________________________________________

I, the undersigned, hereby certify that I have reviewed the hearing record and concur with the above decision.

Suzanne Iannella, Commissioner ____________________________________________

Dated at Boston, Massachusetts this 4th day of May 2005.