Alcoholic Beverage Control Act - California ABC - Homepage

376 Pages·2007·1.76 MB·English

STATEOFCALIFORNIA
DEPARTMENT OFALCOHOLIC BEVERAGE CONTROL
Alcoholic Beverage
Control Act
Business and Professions Code
Division 9
and Related Statutes
EFFECTIVEJANUARY1,2007
printedatCALIFORNIAOFFICEOFSTATEPUBLISHING
Availableon-linewww.abc.ca.gov

ALCOHOLICBEVERAGECONTROLACT 3
TABLEOFCONTENTS
CONSTITUTIONALPROVISIONS— Sections Page
UnitedStatesConstitution.AmendmentNo.XXI........................................................................ 5
CaliforniaConstitution.ArticleXX.............................................................................................. 5
BUSINESSANDPROFESSIONSCODE—
DIVISION9. ALCOHOLICBEVERAGES.......................................... 23000–25763 13
Chapter 1. GeneralProvisionsandDefinitions................................. 23000–23047 13
Chapter 1.5. Administration................................................................. 23049–23098 21
Article 1. TheDepartmentofAlcoholicBeverage
Control......................................................................... 23049–23058 22
2. ProhibitedActivity........................................................... 23060 24
3. TheAlcoholicBeverageControlAppealsBoard............ 23075–23078 25
4. AppealsFromDecisionsoftheDepartment................... 23080–23089 25
5. JudicialReview................................................................ 23090–23090.7 28
6. StayofSuspension.......................................................... 23095–23098 31
Chapter 2. AuthorizedUnlicensedTransactionsand
Exemptions.................................................................. 23100–23113 32
Chapter 3. LicensesandFees............................................................ 23300–23455 39
Article 1. InGeneral........................................................................ 23300–23301 39
2. Fees.................................................................................. 23320–23334 39
3. RightsandObligationsofLicensees............................... 23355–23405.2 49
4. ClubLicenses................................................................... 23425–23438 80
5. Veterans’ClubLicenses................................................... 23450–23455 89
Chapter 4. Imports............................................................................. 23660–23673 90
Chapter 5. RestrictionsonIssuanceofLicenses............................... 23770–23827 96
Article 1. InGeneral........................................................................ 23770–23793 96
1.5. ConditionalLicenses....................................................... 23800–23805 104
2. LimitationonNumberofLicensedPremises................. 23815–23827 106
Chapter 6. IssuanceandTransferofLicenses................................... 23950–24082 113
Article 1. ApplicationsforLicenses................................................ 23950–23962 113
2. Notices............................................................................. 23985–23988 120
3. DenialandProtest............................................................ 24010–24016 122
4. IssuanceandRenewalofLicenses.................................. 24040–24052 124
5. TransferofLicenses........................................................ 24070–24082 141
Chapter 7. SuspensionandRevocationofLicenses......................... 24200–24211 154
Chapter 8. Hearings........................................................................... 24300–24310 163
Chapter 9. GroupPurchase................................................................ 24400 164
Chapter 10. AlcoholicBeveragesFairTradeContractsand
PricePosting[Repealed]............................................. 24749–24757.5 165
Chapter 11. WineFairTradeContractsand
PricePosting[Repealed]............................................. 24850–24881 165
Chapter 12. BeerPricePostingandMarketingRegulations.............. 25000–25010 166
Chapter 13. LabelsandContainers..................................................... 25170–25243 170
Article 1. DistilledSpirits................................................................ 25170–25181 170
2. Beer.................................................................................. 25200–25212 172
3. Wine................................................................................. 25235–25243 173
Chapter 14. SeizureandForfeitureofProperty.................................. 25350–25375 176
Chapter 15. Tied-houseRestrictions................................................... 25500–25512 182
4 ALCOHOLICBEVERAGECONTROLACT
TABLEOFCONTENTS—Continued
Chapter 16. RegulatoryProvisions...................................................... 25600–25667 215
Article 1. InGeneral........................................................................ 25600–25621 215
2. HoursofSaleandDeliveryofAlcoholic
Beverages..................................................................... 25630–25633 226
3. WomenandMinors......................................................... 25655–25667 227
Chapter 17. AdministrativeProvisions............................................... 25750–25763 237
CASESARISINGUNDERPROVISIONSOFLIQUORCONTROLAND
BEVERAGETAXACTSOF1933............................................................ 242
OTHERSTATUTESAFFECTINGREGULATIONOFTHEALCOHOLIC
BEVERAGEINDUSTRY........................................................................... 242
FEDERALLAWS........................................................................................................................... 273
INDEXTOALCOHOLICBEVERAGECONTROLACT........................................................... 275
CALIFORNIACODEOFREGULATIONS—
TITLE 4. DEPARTMENTOFALCOHOLICBEVERAGECONTROL.................. 305
ABCRELATEDVIOLATIONS(ABC-41-L)CHART..................................................................373–374
CONSTITUTIONALPROVISIONS 5
UNITEDSTATESCONSTITUTIONAMENDMENTNo.XXI
REPEALOFEIGHTEENTHAMENDMENT
§ 1. TheeighteentharticleofamendmenttotheConstitutionoftheUnitedStates
isherebyrepealed.
§ 2. Thetransportationorimportationintoanystate,territoryorpossessionof
the United States for delivery or use therein of intoxicating liquors, in violation of
thelawsthereof,isherebyprohibited.
§ 3. This article shall be inoperative unless it shall have been ratified as an
amendmenttotheConstitutionbyconventionintheseveralstates,asprovidedinthe
Constitutionwithinsevenyearsfromthedateofthesubmissionhereoftothestates
bytheCongress.
History.—ThisamendmenttotheFederalConstitutionbecameeffectiveDecember5,1933.
ImpositionofImporter’slicensefeeconstitutional.—TheprovisionoftheAlcoholicBeverageControlActimposingalicense
feeoffivehundreddollars($500)fortheprivilegeofimportingbeerwithintheStatedoesnotviolatetheFederalConstitution.Theprovision
isvalidunderSection2oftheTwenty-firstAmendment.StateBoardofEqualizationv.Young’sMarketCompany,299U.S.59.
Shipmentsthroughstate.—TheTwenty-firstAmendmenthasnoapplicationtothetransportationofliquorthroughastate;hence
liquorpurchasedforshipmenttoHawaii,buttemporarilystoredinSanFranciscowarehousesbecauseofshortageofshippingspace,isnot
subjecttolocalpropertytaxation.VonHamm-YoungCo.v.SanFrancisco,29Cal.2d798.
ForeignImports.—LiquorimportedintoCaliforniafromoutsidetheUnitedStates,unconsigned,unsold,andstillintheimporter’s
handsontaxassessmentday,isnotsubjecttoanadvaloremtaxbyasubdivisionoftheState.ParrotandCo.v.CityandCountyofSan
Francisco,131Cal.App.2d332,280Pac.2d881.
Discrimination.—StatelegislationfavoringCaliforniaproductionofalcoholicbeveragesoverout-of-stateproductionisauthorized
bythissection.AmericanDistillingCo.v.StateBoardofEqualization,144Cal.App.2d457,301Pac.2d495.
Authorityunder21stAmendment.—Whilethestates,vestedastheyarewithgeneralpolicepower,requirenospecificgrantof
authorityintheFederalConstitutiontolegislatewithrespecttomatterstraditionallywithinthescopeofthepolicepower,thebroadsweep
oftheTwenty-firstAmendmentconferssomethingmorethanthenormalstateauthorityoverpublichealth,welfare,andmorals.California
v.LaRue,409U.S.109(1972).
Departmentalcontrolunder21stAmendment.—Incontext,notofcensoringdramaticperformancesintheaterbutoflicensing
barsandnightclubstosellliquorbythedrink,theCaliforniaDepartmentofAlcoholicBeverageControlhadbroadlatitudeundertheTwenty-
firstAmendmenttocontrolthemannerandcircumstancesunderwhichliquormightbedispensed,andtheconclusionthatthesaleofliquor
bythedrinkandlewdornakedentertainmentshouldnottakeplacesimultaneouslyinlicensedestablishmentswasnotirrationalnorunreasonable.
Californiav.LaRue,409U.S.109(1972).
Presumptionofvalidity.—Thereisapresumptioninfavorofthevalidityofstateregulationintheareaoflicensingofthesaleof
alcoholicbeveragesbythedrink.Californiav.LaRue,409U.S.109(1972).
Twenty-firstAmendmentv.ShermanAntitrustAct.—The21stAmendment,providingthatthetransportationorimportation
intoanystatefordeliveryorusethereinofintoxicatingliquorsinviolationofthelawsthereofisprohibited,doesnotpermitCaliforniato
fixretailpricesofdistilledspiritscontrarytotheprovisionsoftheShermanAntitrustActprohibitingcontractsinrestraintoftrade.Inbalancing
California’sinterestinpromotingtemperanceandorderlymarketconditionsbyresalepricemaintenanceagainstthepoliciesunderlyingthe
ShermanAct,thepoliciesunderlyingtheShermanActmustprevail,andthepricemaintenanceprovisionswerethereforeinvalid,whereit
appearedthepoliciesunderlyingtheShermanActwereclearlyviolatedbytheliquorpricemaintenancelaws,wheretherewasdoubtwhether
suchlawspromotedtemperance,wheretherewasaclearnationaltrendagainstfairtradelaws,andwherethereexistedmeansotherthan
mandatorypricefixingtoachieveendswhichthoselawsseektoattain.Ricev.ABCAppealsBoard(Corsetti,etal.),21Cal.3d431.
Interstatewinerydirectshipmentstoconsumers.—Theprohibitionagainstout-of-statewineriesmakingshipmentsofwine
directlytoconsumerswhensuchshipmentsarepermittedbyin-statewineriesviolatesthedormantinterstatecommerceclauseandisnot
protectedbythe21stAmendment.Granholmv.Heald125S.Ct.1885(2005).
CALIFORNIACONSTITUTIONARTICLEXX
STATECONTROLOFLIQUORSALES
SEC.22. TheStateofCalifornia,subjecttotheinternalrevenuelawsoftheUnited
States,shallhavetheexclusiverightandpowertolicenseandregulatethemanufacture,
sale,purchase,possessionandtransportationofalcoholicbeverageswithintheState,
and subject to the laws of the United States regulating commerce between foreign
nationsandamongthestatesshallhavetheexclusiverightandpowertoregulatethe
importationintoandexportationfromtheState,ofalcoholicbeverages.Intheexercise
oftheserightsandpowers,theLegislatureshallnotconstitutetheStateoranyagency
thereofamanufacturerorsellerofalcoholicbeverages.
All alcoholic beverages may be bought, sold, served, consumed, and otherwise
disposed of in premises which shall be licensed as provided by the Legislature. In
6 CONSTITUTIONALPROVISIONS
providingforthelicensingofpremises,theLegislaturemayprovidefortheissuance
of,amongotherlicenses,licensesforthefollowingtypesofpremiseswherethealcoholic
beveragesspecifiedinthelicensesmaybesoldandservedforconsumptionuponthe
premises:
(a) Forbonafidepubliceatingplaces,asdefinedbytheLegislature.
(b) Forpublicpremisesinwhichfoodshallnotbesoldorservedasinabonafide
publiceatingplace,butuponwhichpremisestheLegislaturemaypermitthesaleor
serviceoffoodproductsincidentaltothesaleandserviceofalcoholicbeverages.No
personundertheageof21yearsshallbepermittedtoenterandremaininanysuch
premiseswithoutlawfulbusinesstherein.
(c) Forpublicpremisesforthesaleandserviceofbeersalone.
(d) Under such conditions as the Legislature may impose, for railroad dining or
club cars, passenger ships, common carriers by air, and bona fide clubs after such
clubshavebeenlawfullyoperatedfornotlessthanoneyear.
The sale, furnishing, giving, or causing to be sold, furnished, or giving away of
anyalcoholicbeveragetoanypersonundertheageof21yearsisherebyprohibited,
andnopersonshallsell,furnish,give,orcausetobesold,furnished,orgivenaway
anyalcoholicbeveragetoanypersonundertheageof21years,andnopersonunder
theageof21yearsshallpurchaseanyalcoholicbeverage.
TheDirectorofAlcoholicBeverageControlshallbetheheadoftheDepartment
of Alcoholic Beverage Control, shall be appointed by the Governor subject to
confirmationbyamajorityvoteofallofthememberselectedtotheSenate,andshall
serveatthepleasureoftheGovernor.Thedirectormayberemovedfromofficeby
theGovernor,andtheLegislatureshallhavethepower,byamajorityvoteofallmembers
elected to each house, to remove the director from office for dereliction of duty or
corruptionorincompetency.Thedirectormayappointthreepersonswhoshallbeexempt
from civil service, in addition to the person he is authorized to appoint by Section
4ofArticleXXIV.
The Department ofAlcoholic Beverage Control shall have the exclusive power,
except as herein provided and in accordance with laws enacted by the Legislature,
tolicensethemanufacture,importationandsaleofalcoholicbeveragesinthisState,
and to collect license fees or occupation taxes on account thereof.The department
shallhavethepower,initsdiscretion,todeny,suspendorrevokeanyspecificalcoholic
beverageslicenseifitshalldetermineforgoodcausethatthegrantingorcontinuance
ofsuchlicensewouldbecontrarytopublicwelfareormorals,orthatapersonseeking
orholdingalicensehasviolatedanylawprohibitingconductinvolvingmoralturpitude.
It shall be unlawful for any person other than a licensee of said department to
manufacture,importorsellalcoholicbeveragesinthisState.
TheAlcoholic Beverage ControlAppeals Board shall consist of three members
appointedbytheGovernor,subjecttoconfirmationbyamajorityvoteofallofthe
memberselectedtotheSenate.Eachmember,atthetimeofhisinitialappointment,
shall be a resident of a different county from the one in which either of the other
members resides. The members of the board may be removed from office by the
Governor,andtheLegislatureshallhavethepower,byamajorityvoteofallmembers
electedtoeachhouse,toremoveanymemberfromofficeforderelictionofdutyor
corruptionorincompetency.
When any person aggrieved thereby appeals from a decision of the department
orderinganypenaltyassessment,issuing,denying,transferring,suspendingorrevoking
anylicenseforthemanufacture,importation,orsaleofalcoholicbeverages,theboard
shall review the decision subject to such limitations as may be imposed by the
CONSTITUTIONALPROVISIONS 7
Legislature. In such cases, the board shall not receive evidence in addition to that
consideredbythedepartment.Reviewbytheboardofadecisionofthedepartment
shall be limited to the questions whether the department has proceeded without or
inexcessofitsjurisdiction,whetherthedepartmenthasproceededinthemannerrequired
bylaw,whetherthedecisionissupportedbythefindings,andwhetherthefindings
aresupportedbysubstantialevidenceinthelightofthewholerecord.Inappealswhere
the board finds that there is relevant evidence which, in the exercise of reasonable
diligence, could not have been produced or which was improperly excluded at the
hearing before the department it may enter an order remanding the matter to the
departmentforreconsiderationinthelightofsuchevidence.Inallotherappealsthe
boardshallenteranordereitheraffirmingorreversingthedecisionofthedepartment.
When the order reverses the decision of the department, the board may direct the
reconsiderationofthematterinthelightofitsorderandmaydirectthedepartment
totakesuchfurtheractionasisspeciallyenjoineduponitbylaw,buttheordershall
notlimitorcontrolinanywaythediscretionvestedbylawinthedepartment.Orders
of the board shall be subject to judicial review upon petition of the director or any
partyaggrievedbysuchorder.
Aconcurrent resolution for the removal of either the director or any member of
theboardmaybeintroducedintheLegislatureonlyiffiveMembersoftheSenate,
or10MembersoftheAssembly,joinasauthors.
UntiltheLegislatureshallotherwiseprovide,theprivilegeofkeeping,buying,selling,
serving,andotherwisedisposingofalcoholicbeveragesinbonafidehotels,restaurants,
cafes,cafeterias,railroaddiningorclubcars,passengerships,andotherpubliceating
places, and in bona fide clubs after such clubs have been lawfully operated for not
lessthanoneyear,andtheprivilegeofkeeping,buying,selling,serving,andotherwise
disposingofbeersonanypremisesopentothegeneralpublicshallbelicensedand
regulatedundertheapplicableprovisionsoftheAlcoholicBeverageControlAct,insofar
as the same are not inconsistent with the provisions hereof, and excepting that the
licensefeetobechargedbonafidehotels,restaurants,cafes,cafeterias,railroaddining
orclubcars,passengerships,andotherpubliceatingplacesandanybonafideclubs
aftersuchclubshavebeenlawfullyoperatedfornotlessthanoneyear,fortheprivilege
ofkeeping,buying,selling,orotherwisedisposingofalcoholicbeverages,shallbe
the amounts prescribed as of the operative date hereof, subject to the power of the
Legislaturetochangesuchfees.
TheStateBoardofEqualizationshallassessandcollectsuchexcisetaxesasare
or may be imposed by the Legislature on account of the manufacture, importation
andsaleofalcoholicbeveragesinthisState.
TheLegislaturemayauthorize,subjecttoreasonablerestrictions,thesaleinretail
storesofalcoholicbeveragescontainedintheoriginalpackages,wheresuchalcoholic
beveragesarenottobeconsumedonthepremiseswheresold;andmayprovidefor
the issuance of all types of licenses necessary to carry on the activities referred to
inthefirstparagraphofthissection,including,butnotlimitedto,licensesnecessary
forthemanufacture,production,processing,importation,exportation,transportation,
wholesaling,distribution,andsaleofanyandallkindsofalcoholicbeverages.
The Legislature shall provide for apportioning the amounts collected for license
feesoroccupationtaxesundertheprovisionshereofbetweentheStateandthecities,
countiesandcitiesandcountiesoftheState,insuchmannerastheLegislaturemay
deemproper.
8 CONSTITUTIONALPROVISIONS
Allconstitutionalprovisionsandlawsinconsistentwiththeprovisionshereofare
herebyrepealed.
Theprovisionsofthissectionshallbeself-executing,butnothinghereinshallprohibit
the Legislature from enacting laws implementing and not inconsistent with such
provisions.
ThisamendmentshallbecomeoperativeonJanuary1,1957.
History.—OriginalsectionadoptedNovember8,1932,grantingStateexclusiverighttoregulatesale,etc.,of
intoxicatingliquorwithinStatewhenlawfulunderConstitutionandlawsofStateandofUnitedStatesand
providingthatnopublicdrinkingplaceshouldeverbeestablishedintheStatebutthatwineandbeercould
beservedwithmealsinhotels,restaurantsandotherpubliceatingplaces,andthattheLegislaturecould
authorizethesaleofliquorinretailstoreswheresuchliquorwasnottobeconsumedonthepremiseswhere
sold.Theamendmentof1954transferredthelicensingfunctionsfromtheStateBoardofEqualizationtothe
DepartmentofAlcoholicBeverageControlandcreatedtheAlcoholicBeverageControlAppealsBoard.Cases
citedbelowreferringtotheBoardofEqualization’slicensing,disciplinaryandrulemakingauthorityare
applicabletothedepartment.Theamendmentof1957changedthesectiontoreadasabove.
Whomaylicense.—SubsequenttoApril6,1933,andpriortoDecember5,1933(theoperativedateofthissection),amunicipalcorporation,
aswellastheState,hadtherighttolicense,forrevenue,dealersinliquor.LosAngelesBrewingCo.v.CityofLosAngeles,8Cal.2d379.
AfterDecember5,1933,therightofamunicipalcorporationtoimposealicensetaxforthepurposeofrevenueuponsuchdealerswasremoved.
LosAngelesBrewingCo.v.CityofLosAngeles,8Cal.App.2d391.PaymentsmadeafterDecember5,1933,forliquorlicensetaxstamps
weremadeinvoluntarilywhenthepaymentwasrequiredbyacityordinanceimposingseverecivilandcriminalpenaltiesforfailuretopay
thetaxandthepaymentwasaccompaniedbyawrittenprotest.Vitalev.CityofLosAngeles,13Cal.App.2d704.
Propertytaxationnotaffected.—ThissectiondoesnotdeprivethepoliticalsubdivisionsoftheStateofthepowertolevyaproperty
taxuponintoxicatingliquors.ThreeGDistilleryCorporationv.LosAngelesCounty,46Cal.App.2d498.
Construction.—Thissection(priortoitsamendmentNovember6,1934)providednolimitationonthepowergiventotheLegislature
toregulatethesaleofwinesandbeerwhenmealsarefurnished.AreasonableconstructionoftheactsoftheLegislatureandtherulesand
regulationsoftheStateBoardofEqualizationmadeinpursuancethereof,gavetheboardthepowertodeterminethesuitabilityandfitness
ofthepremises,includingthenatureofthelocation,andtoconsiderquestionsaffectingthepeace,safetyandgoodorderofthesurroundings
wherethesalewastobemade.Parentev.StateBoardofEqualization,1Cal.App.2d238.
TheUnlawfulLiquorSalesAbatementActof1915isnotrepugnanttonorinconsistentwith,andthereforewasnotimpliedlyrepealed
by,theadoptionofthissectionoroftheAlcoholicBeverageControlAct.Hammondv.McDonald,32Cal.App.2d187.
Licensemaynotberevokedwithoutnoticeandhearing.—ThissectiondoesnotgivetheStateBoardofEqualizationthe
powertorevokealicensewithoutnoticetothelicenseeandanopportunityforhimtobeheard.Sections40and41oftheAlcholicBeverage
ControlAct,providingfornoticeandhearing,regulatetheprocedurefortheexerciseoftheboard’sjurisdictionandarenotinconflictwith
thepowersgrantedtheboardbytheConstitution.Irvinev.StateBoardofEqualization,40Cal.App.2d280.
Boardhasbroaddiscretionarypowers.—TheStateBoardofEqualizationisgivenbroaddiscretionarypowersbythissection,
anditsdiscretionwasnotabusedbythedenialofalicenseinapurelyresidentialcenterwheredeedscontainedrestrictivecovenantsagainst
thesaleofliquor.Whetherornotthereexistsgoodcauseforthedenialofalicenseisamatterfordeterminationbytheboardandnotby
thecourts.Hansenv.StateBoardofEqualization,43Cal.App.2d176.
DeterminationofboundariesofStanfordUniversity.—ThedepartmentmaydeterminethattheboundariesofLelandStanford
JuniorUniversityarewithinoneandone-halfmilesofcertainlicensedpremisesonthebasisoftheuniversitytrustees’determinationofthe
boundariesofthecampus,eventhoughsuchdeterminationresultsinthemandatoryrevocationofsuchlicenses.Vanoliv.Munro,147Cal.
App.2d179.
JudicialReview.—Thedepartment’sdecisionafteranadministrativehearingwillnotbeupsetonappealwhensupportedbysubstantial
evidenceeventhoughcontradicted.Molinav.Munro,145Cal.App.2d601,302Pac.2d819;MaxwellCafev.DepartmentofAlcoholic
BeverageControl,142Cal.App.2d73,298Pac.2d64;Dethlefsenv.StateBoardofEqualization,145Cal.App.2d561,303Pac.2d7;
Kirchhubelv.Munro,149Cal.App.2d243,308Pac.2d433.
Findingsmadebythedepartmentinanadministrativehearingmustbesustainedonappealifthedepartmenthascommittednoerrorof
lawandiftheevidence,althoughconflicting,issufficienttosupportsuchfinding.Griswoldv.DepartmentofAlcoholicBeverageControl,
141Cal.App.2d807,297Pac.2d762;Molinav.Munro,145Cal.App2d601,302Pac.2d818;Marcucciv.BoardofEqualization,138
Cal.App.2d605,292Pac.2d264;Kirchhubelv.Munro,149Cal.App.2d243;Covertv.StateBoardofEqualization,29Cal.2d125.
ThedepartmentisanagencyonwhichtheConstitutionhasconferredlimitedjudicialpowers,andthusitsdecisionsonfactualmatters
mustbeaffirmedifthereissubstantialevidencetosupportthem.Atrialcourtisnotpermittedtoexerciseanindependentjudgmentofthe
factsinreviewingthedepartment’ssuspensionofalicense,butmustgivethedepartment’sfactualdeterminationsthesamedeferencethat
anappellatecourtmustgivetothefindingsofatrialcourt.Bricev.DepartmentofAlcoholicBeverageControl,153Cal.App.2d315;Oxman
v.DepartmentofAlcoholicBeverageControl,153Cal.App.2d740;Hasselbachv.DepartmentofAlcoholicBeverageControlandVon’s
Grocery,167Cal.App.2d662;Colemanv.Harris,etal.,218Cal.App.2d401.
Transferoffunctionstodepartment.—AlcoholicbeveragecontrolregulationsadoptedbytheStateBoardofEqualizationprior
toJanuary1,1955,becomeonthatdatetheregulationsoftheDepartmentofAlcoholicBeverageControl.25Ops.Atty.Gen.158,55/33
2-24-55.
ThedepartmentisnotestoppedtorevokealicenseissuedbytheStateBoardofEqualizationunderanerroneousconstructionofitsown
rulesandtheAlcoholicBeverageControlAct.JosephGeorge,Distributorv.DepartmentofAlcoholicBeverageControl,149Cal.App.2d
702.
TheDepartmentofAlcoholicBeverageControlshouldissueinterstatetransporter’spermitsalthoughtheBoardofEqualizationmayrequire
reportsfrompermittees.26Ops.Atty.Gen.3,55/367-8-55.
1954amendmentnotlimitationonauthorityofdepartment.—The1954amendmentauthorizingtherevocationofalicense
ofapersonwhohasviolatedanylawprohibitingconductinvolvingmoralturpitudedidnotlimittheauthorityofthedepartmenttorevoke
forothercauses.Mercuriov.DepartmentofAlcoholicBeverageControl,144Cal.App.2d626.
CONSTITUTIONALPROVISIONS 9
PowerofdepartmentcoextensivewiththatofLegislature.—TheDepartmentofAlcoholicBeverageControlhasbroad
powerstodeterminewhatconductmakescontinuanceofalicensecontrarytopublicwelfareandmoralsandmayadoptrulesprohibiting
B-girlsolicitationalthoughLegislaturehasenactednumerouslawsonthesamesubject.Mercuriov.DepartmentofAlcoholicBeverageControl,
144Cal.App.2d626,301Pac.2d474.
Countymaynotexcludesaleofalcoholicbeveragesfromcountybeach.—Aconcessionairemaybelicensedtosell
alcoholicbeveragesonacountybeachbythedepartmentnotwithstandingtheexistenceofacountyordinanceprohibitingthesaleofalcoholic
beveragesonsuchcountybeach.MalibuEnterprisesInc.v.CountyofLosAngeles,LosAngelesSuperiorCourtNo.609,209,reportedin
LosAngelesDailyJournalReportsSection,April1,1954,page103.
Saletominor.—Thedepartmentdidnotabuseitsdiscretioninsuspendinganalcoholicbeveragelicenseforsellingliquortoaminor,
notwithstandingthefactthattheminorwas20yearsand4monthsofageatthetimeofthesale,thatthesalewasnotdeliberate,andthe
offensewasthelicensee’sfirst.Griswoldv.DepartmentofAlcoholicBeverageControl,141Cal.App.2d807,297Pac.2d762.
Narcoticssalescontrarytowelfareandmorals.—Successivesalesofnarcoticsbythelicensee’sbartenderrendercontinuance
ofthelicensecontrarytopublicwelfareandmorals.Endov.StateBoardofEqualization,143Cal.App.2d395,300Pac.2d366.
Femaleemployeesacceptingdrinks.—Permittingfemaleemployeestoacceptalcoholicdrinkspurchasedbypatronsofon-
salepremisesiscontrarytopublicwelfareandmorals.Mercuriov.DepartmentofAlcoholicBeverageControl,144Cal.App.2d626,301
Pac.2d474.
ViolationofSection303ofthePenalCodeisgoodcauseforrevocationofon-salelicense.—ViolationofSection
303ofthePenalCode,prohibitingtheemploymentofpersonstoencouragethesaleofdrinks,constitutesgoodcauseforrevocationofan
on-salegeneralliquorlicensebytheStateBoardofEqualization.Afindingofviolationissupportedbytestimonyofliquorcontrolofficers
thatgirlsonthepremisesofthelicenseeencouragedthemtobuydrinks;thatdiluted,excessivelypriceddrinksboughtforeachgirlwere
separatelyidentifiedastothegirlonthecashregisterandthatthelicenseeandthegirlsmadestatementsadmittingtheemployment,even
thoughthetestimonyiscontradictedbythegirlsandthelicensee.Chosickv.Reilly,125Cal.App.2d334.
Evidencethaton-salegenerallicensee’sfemaleemployeesdrankalcoholicbeverageswithpatrons,solicitedpatronstopurchasedrinks
forthem,andthatbartenderkeptatallyofdrinkspurchasedforthesefemaleemployees,althoughtherewasnoevidenceofpaymentofa
commissiontothesefemaleemployees,wassufficienttosupportafindinginarevocationproceedingthatthesolicitationofdrinkswasan
integralpartoftheemploymentofthesefemalesinviolationofPenalCode§303.Hobsonv.Reilly,132Cal.App.2d275,281Pac.2d877.
Powertorevokeincludespowertosuspend.—Underthisconstitutionalprovision,whichendowstheStateBoardofEqualization
withexclusivepowertolicensethesaleofintoxicatingliquor,includingdiscretionarypowertodenyorrevokealiquorlicense,theboard
hasthepowertosuspend,aswellastorevokealicense.Reynoldsv.StateBoardofEqualization,29Cal.2d137.
Groundsforlicenserevocation.—Underthissection,theStateBoardofEqualizationisnotrestrictedtothegroundsforrevoking
alicensestatedintheAlcoholicBeverageControlAct,butitmaytakedisciplinaryactiononothergroundswithinthepowerconferredby
thisconstitutionalprovision;andinthisrespecttheboarddidnotabuseitsdiscretioninrevokingaliquorlicenseofalicenseewhowas
convictedofviolatingafederallawrelatingtoceilingpricesforalcoholicbeverages.Moorev.StateBoardofEqualization,29Cal.App.
2d758.
Acquittalofmanagerofbaremployedbyholderofon-salegenerallicenseonchargeofemployinggirlstoprocureorencouragepurchase
ofalcoholicbeveragesinviolationofPenalCode§303wasnotresjudicataonthequestionofwhethersuchoffensehadbeencommitted
insubsequentdisciplinaryproceedingsbasedonthesamefact.Thestandardstobeappliedinaproceedingforrevocationofaliquorlicense
werenotthoseapplicabletocriminaltrials.EvidencetakeninrevocationproceedingsustainedfindingofviolationofPenalCode§303.
TheConstitutionconferredontheBoardofEqualizationpowertorevokeanon-salegeneralliquorlicenseiftheevidenceshowsasituation
contrarytopublicwelfareandmorals,regardlessofwhethertherehasbeenanycriminalviolation.Cornellv.Reilly(1954),127Cal.App.
178,273Pac.2d572.
Revocationofanon-salegenerallicenseforviolationof§25601issupportedbyevidencethatfightsoccurredonandaboutthepremises;
thatintoxicatedpersonsandnarcoticsusersfrequentedthepremises;andthatprostituteswerearrestedandconvictedforsolicitationonthe
premises.To‘‘permit’’actsconstitutingavolationdoesnotinvolveaffirmativeactionorintentandactspermittedbyemployeesareconsidered
permittedbythelicensee.Sweglev.StateBoardofEqualization,125Cal.App.2d432.
Conditionsofprivilege.—TheLegislaturemayimposeonagrantoftheprivilegetosellalcoholicbeveragesaconditionthatthe
licenseemustbevigilanttoseethatsalesofnarcoticsdonottakeplaceonhispremisesandthatiftheydotakeplacesuccessivelyhewill
bepresumedtoknowofthem.Kirchhubelv.Munro,149Cal.App.2d243,308Pac.2d433.
Localrevenueaffectedbystatecentralizationofliquorcontrol.—Theprovisioninthissectionforapportioninglicense
feesoroccupationtaxesisrecognitionofthefactthatcentralizationofliquorcontrolintheStateGovernmentwoulddeprivelocalsubdivisions
oftheStateofapotentialsourceofrevenue.Roehmv.CountyofOrange,32Cal.2d280.
Localoption.—Section38foftheAlcoholicBeverageControlActprovidingforlicenselimitationdoesnotgivetocitiesorcounties
anyrighttomakeageneralprotestagainstthepolicyofissuingadditionallicenses,forsucharightwouldbeentirelydifferentfromanything
otherwisegiventocitiesandcountiesandwouldbecontrarytothepurposeexpressedinthisconstitutionalprovision,whichvestsmatters
exclusivelyintheStateGovernment.SanDiegov.StateBoardofEqualization,82Cal.App.2d453.
Municipalexcisetaxvalidlyappliedtopurchasesofintoxicatingliquors.—Section22ofArticleXXoftheStateConstitution,
reservingtotheStatethe‘‘exclusive... powerto...regulate’’the‘‘sale’’and‘‘purchase’’ofintoxicatingliquorisnotviolatedbyapplication
tothesaleofintoxicatingliquorsofamunicipalordinanceimposinganexcisetaxonthepurchaseatretailoftangiblepersonalproperty
andrequiringcollectionofthetaxfromthepurchaserbytheretailer.Ainsworthv.Bryant,34Cal.2d465.
Whatconstitutesaseasonalbusiness.—A‘‘seasonal’’business,referredtointhissection,meansabusinesslocatedinaseasonal
areawhereconsumerdemandfluctuatesduringdifferentperiodsoftheyear.Johnstonev.Richardson,103Cal.App.2d41.
Premisesnearachurch.—WhethertheStateBoardofEqualizationabusesitsdiscretioninissuingalicenseforthesaleofalcoholic
beveragescanbedeterminedonlybyexaminingallthefactsandcircumstances,andthemerefactthatchurchesareintheimmediatevicinity
oftheapplicant’spremisesdoesnotestablishanabuseofdiscretionbytheboardingrantingthelicense.AltadenaCommunityChurchv.
StateBoardofEqualization,109Cal.App.2d99.
10 CONSTITUTIONALPROVISIONS
Thedepartment’sdenialofanon-salebeerandwinelicenseonthegroundofproximitytoachurchwasoverruledbecause‘‘mereproximity’’
toachurchisnotinitselfgoodcausetodenyalicense.Therecordmustcontainsomeevidencedemonstratingagoodcausefordenial.Martin
v.AlcoholicBeverageControlAppealsBoardandHayes,55Cal.2d867.
Denialofoff-salelicensenearschool.—WhiletheStateBoardofEqualizationisauthorizedundertheAlcoholicBeverageControl
Acttorefuseanon-saleliquorlicenseforpremisesintheimmediatevicinityofaschool,theabsenceofsuchaprovisionastooff-salelicenses
doesnotprecludetheboardfrommakingproximityofthepremisestoaschoolanadequatebasisfordenyinganoff-salelicenseasbeing
inimicaltopublicwelfareandmorals.Thedenialofanoff-salebeerandwinelicenseatagrocerystoreacrossthestreetfromhighschool
groundsisnotarbitrarybecausethereareotherliquorlicenseesoperatinginthevicinityoftheschool.Weissv.StateBoardofEqualization,
40Cal.2d772,256Pac.2d.
Discretiontodenyongroundsofoverconcentration.—Itwasnotanabuseofdiscretionforthedepartmenttodenyanon-
salebeerlicensewheretheevidenceshowedthatthepremiseswerelocatedinanareawheretherewere88licensedpremises,26ofwhich
werewithinaradiusof500feetoftheproposedpremises,asitisnotunreasonabletoeffecttheremovalofobjectionableconcentrationthrough
theprocessresultingfromexpirationandrefusaltograntreplacement.Torresv.DepartmentofAlcoholicBeverageControl,192Cal.App.
2d541.
Patronageofon-salepremisesbyhomosexualsisinsufficientforrevocationoflicense.—Proofofpatronageof
apublicrestaurantwithanon-salegenerallicensebyhomosexualswithoutproofofillegalorimmoralactsonthepremisesisinsufficient
toestablish‘‘goodcause’’forthesuspensionorrevocationofthelicenseunderthisconstitutionalprovision.Stoumenv.Reilly,37Cal.2d
713.
Administrativeproceedingsnotcriminalinnature.—Therequirementofcorroborationofaccomplicesincriminalproceedings
doesnotapplytoanadministrativeproceedingtorevokealiquorlicense.Oxmanv.DepartmentofAlcoholicBeverageControl,153Cal.
App.2d740.
Thereisnomerittothecontentionthatamisdemeanorshouldbetriedincourtandnotbeforethedepartment.Nelsonv.Departmentof
AlcoholicBeverageControl,166Cal.App.2d783,333Pac.2d771.
Decisionbydepartmentonrecordalone.—Thedepartmentmayrejecttheproposeddecisionofahearingofficeranddecide
thecaseontherecordwithouttakingadditionalevidence.Schaub’s,Inc.,v.DepartmentofAlcoholicBeverageControl,153Cal.App.2d
858.
Penalty,discretionofdepartment.—Theproprietyofthepenaltyimposedbyanadministrativeagencyiswithinthediscretion
oftheagency,andthedecisionwillnotbedisturbedunlesstherehasbeenaclearabuseofdiscretion.Martinv.AlcoholicBeverageControl
AppealsBoardandHaley,52Cal.2d287;Munrov.AlcoholicBeverageControlAppealsBoardandMoss,154Cal.App.2d326.
TheConstitutionexpresslyauthorizeslicenserevocationinthediscretionofthedepartment,andtheSupremeCourtisnotfreetosubstitute
itsowndiscretionevenifitwereinclinedtodoso.Adeterminationthatrevocation,ratherthansuspension,ofaliquorlicensefortaking
betsonthelicensedpremisesistooharshisnotwithintheproperfunctionoftheSupremeCourt,sincesuchconductconstitutesacrime
andatleasttechnicallyiscontrarytopublicwelfareandmorals.Macfarlanev.DepartmentofAlcoholicBeverageControl,51Cal.2d84,
330Pac.2d769.
Estoppelandresjudicata.—Theestoppelofajudgmentextendsonlytothefactsinissueastheyexistedatthetimethejudgment
wasrendered,anddoesnotpreventre-examinationofthesamequestionbetweenthesamepartieswhereintheintervalthefactshavechanged.
Resjudicatawasnotapplicabletoprecludethedepartmentfromgrantingalicenseinchangedconditionsbecausethedepartmenthadpreviously
deniedthesameapplicantalicenseunderdifferentconditions.Thedepartmentisaconstitutionalcreatedtribunalwithfact-findingpower
andisgiventheexclusiveright,initsdiscretion,tograntordenyalicensetosellintoxicatingliquors.Hasselbachv.DepartmentofAlcoholic
BeverageControlandVon’sGrocery,167Cal.App.2d662.
Repeatedviolations.—Afindingofthedepartmentthatalicenseehasrepeatedlyviolated§§23300,23355,23951and23953was
tantamounttoafindingthatcontinuanceofthelicensewouldbe‘‘contrarytopublicwelfare.’’Martinv.AlcoholicBeverageControlAppeals
BoardandHaley,52Cal.2d287.
Privateagreementsnotbindingondepartment.—Anallegedagreementbetweenpartiesnottoprotestissuanceofalicense
isnotbindingonthedepartmentsincetheConstitutionhasdesignatedthedepartmentastheagencychargedwiththedutyofinvestigating
applicationsforlicenses,andsuchinvestigationsmustbemadewithaviewtotheprotectionofpublicwelfareandmorals.Schaub’s,Inc.,
v.DepartmentofAlcoholicBeverageControl,153Cal.App.2d858.
Goodcause.—Thedenialofalicensefor‘‘goodcause’’mustbebasedonsufficientevidence.Thedepartment’sdiscretioninsucha
determinationmaynotbearbitrarybutmustbeinaccordancewithlaw.Baileyv.DepartmentofAlcoholicBeverageControlandDutton,
201Cal.App.2d348.
Findingonultimateissues.—Afindingontheissueofpublicwelfareandmoralsincludesafindingofallspecialfactsnecessary
tosustainitwhicharesupportedbysubstantialevidence,andconstitutesanadversefindingoneveryevidentiaryfactinconflictwithit.
Kossv.DepartmentofAlcoholicBeverageControl,215Cal.App.2d489.
Factualconsiderationsaffectingpublicwelfareandmorals.—Indeterminingtheeffectonpublicwelfareandmoralsthe
departmentmayconsideranapplicant’sintegrity,hispreviousbusinessexperience,themannerinwhichtheproposedbusinesswillprobably
beconducted,thetypeofguestsandtheirprobableconduct,andthenatureofanyprotesttoissuanceofthelicense.Unlessthatdecision
isreachedwithoutreasonundertheevidence,thedepartmentisexercisingavaliddiscretionandneithertheAppealsBoardnorthecourt
mayinterferewithit.Kossv.DepartmentofAlcoholicBeverageControl,215Cal.App.2d489.
Thestatutemakessalesbelowpostedminimumpricesamisdemeanororaconspiracytocommitacrime.Peck’sLiquors,Inc.,v.Superior
Court,221Cal.App.2d772.
AdministrativeregulationsinconflictwiththeConstitutionorstatutesarevoid,thoughrule-makingauthorityderivesdirectlyfromthe
Constitution.Harrisv.AlcoholicBeverageControlAppealsBoardandLevin,228Cal.App.2d1.
ThedepartmentmayadopttheproposeddecisionoftheHearingOfficerwithoutreadingtherecord,(A.P.A.11517(b)).Thisisnotaviolation
ofdueprocess.Stoumenv.Munro,etal.,219Cal.App.2d302.
TheproprietyofapenaltyformisuseofaliquorlicenseisamattervestedinthediscretionoftheDepartmentofAlcoholicBeverageControl;
itsdeterminationmaynotbedisturbedunlessthereisaclearabuseofdiscretion.Thisdiscretionisnotamentaldiscretiontobeexercised
exgratia,butalegaldiscretion,tobeexercisedinconformitywiththespiritofthelawandinamannertosubserveandnottoimpedeor
defeattheendsofsubstantialjustice.Harrisv.AlcoholicBeverageControlAppealsBoardandBelfiore,62Cal.2d589.
Acriminalproceedinghas,foritspurpose,punishmentoftheaccusedifheisfoundguilty;whereasadisciplinaryproceedingagainstan
attorney(licensee)isnotintendedforhispunishment,butisfortheprotectionofthepublic.Yappv.StateBar,62Cal.2d809.
Statutesfixingfairtradepricesdonotviolatedueprocessoflawclauseofthe14thAmendmentoftheU.S.Constitutiononthetheory
itwasanimpairmentofpropertyrighttoprohibitaretailerfromsellingatwhateverpriceitchoosestofix.Dave’sMarket,Inc.,v.Department
ofAlcoholicBeverageControl,222Cal.App.2d671.