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2461 Corp. v. District of Columbia Alcoholic Beverage Control Board

June 12, 2008

2461 CORPORATION T/A MADAM'S ORGAN RESTAURANT, PETITIONER,
v.
DISTRICT OF COLUMBIA ALCOHOLIC BEVERAGE CONTROL BOARD, RESPONDENT.



Petition for Review of an Order of the District of Columbia Alcoholic Beverage Control Board (Order No. 2006-027).

The opinion of the court was delivered by: Thompson, Associate Judge

Argued December 7, 2007

Before FISHER and THOMPSON, Associate Judges, and SCHWELB, Senior Judge.

Petitioner 2461 Corporation does business as "Madam's Organ," a restaurant located at 2461 18th Street, N.W., in the Adams Morgan neighborhood. In an order dated May 5, 2006, the Alcoholic Beverage Control Board ("the Board") imposed sanctions on petitioner for having made a substantial change in the restaurant's operations -- specifically, a change in occupancy -- without Board approval. Petitioner contends that the Board's finding about a substantial change in operations is not supported by substantial evidence in the record. We agree, and therefore vacate the Board's ruling.

I.

On April 23, 2005, an Alcoholic Beverage Regulation Administration ("ABRA") investigator, Willie Parker, conducted a compliance review of petitioner's establishment. The investigator met with one of petitioner's officers and performed a "walk-through." At the conclusion of the "walk-through," the two agreed that there were approximately 203 patrons in the establishment.*fn1 Thereafter, the Board issued a Notice to Show Cause why the Board should not revoke or suspend petitioner's alcoholic beverage license. The Show Cause Order set out the following charge:

You made a change in the occupancy of the licensed establishment which substantially alters the nature of the operation of the licensed establishment, as set forth in the initial application for the license, without obtaining approval of the Board, in violation of D.C. Official Code 25-762 (a) (2001).

On May 3, 2006, the Board held a hearing on the matter, at which Investigator Parker and Mr. Duggan testified. At the conclusion of the hearing, the Board voted to suspend petitioner's license for five days and also fined petitioner $500.*fn2

In its May 5, 2006 written order, the Board noted that petitioner holds a class "CR" Retailer's license,*fn3 for which it first applied in 1997. In its Conclusions of Law, the Board found that petitioner "listed in its initial application for a new Class 'CR' Retailer's license that its capacity will be 99 patrons," that petitioner's "request for a capacity of 99 is consistent with [petitioner's] April 18, 1997 certificate of occupancy for 99 seats that was submitted with [petitioner's] August 13, 1997 [license] application," and that petitioner "holds and has paid for a CR01 license which is for licensed restaurants with a capacity of 99 or fewer patrons." The Board found that the establishment "did increase its Board approved occupancy of the establishment from 99 patrons to approximately 203 patrons, in violation of D.C. Official Code § 25-762 (2001),"*fn4 and that petitioner was guilty of the charged violation, i.e., making a "change in the occupancy of the licensed establishment, without obtaining the approval of the Board."

The Board rejected petitioner's "suggest[ion] to the Board to interpret the establishment's certificate of occupancy and those portions of [petitioner's license] application where the term 'seats' are [sic] used to refer to a seated person and not [to] include standing patrons." The Board concluded that petitioner had changed its occupancy notwithstanding Mr. Duggan's testimony that "through the years," operations at Madam's Organ had "always been the same."

II.

This court reviews the factual findings of the Board with deference, reversing only if the findings are not based on substantial evidence in the record as a whole. See Levelle, Inc. v. District of Columbia Alcoholic Beverage Control Bd., 924 A.2d 1030, 1035 (D.C. 2007); D.C. Code § 2-510 (a)(3)(E) (2001). "Substantial evidence has been defined as 'more than a mere scintilla'; i.e., 'such relevant evidence as reasonable minds might accept as adequate to support the conclusion.'" Kopff v. District of Columbia Alcoholic Beverage Control Bd., 381 A.2d 1372, 1387 (D.C. 1977) (citation omitted). Our task, therefore, is to "assess . . . the logical connection between the evidence and conclusions . . . ." Id. at1387 n.26 (citations and internal quotation marks omitted). There must be "a demonstration in the findings of a 'rational connection between facts found and the choice made.'" Id. at 1387, quoting Brewington v. District of Columbia Bd. of Appeals & Review, 299 A.2d 145, 147 (D.C. 1973). "We review the legal conclusions of an agency de novo." Levelle, 924 A.2d at 1035. We will accord considerable weight to an agency's construction of the statutes and regulations that it administers where the meaning of the language is not clear on its face, but "the judiciary is the final authority on issues of statutory [and regulatory] construction." Id. at 1035-36 (citation omitted).

III.

We are persuaded that the Board's decision in this case is not supported by substantial evidence in the record as a whole and that there is not a logical connection between the facts that the Board found in this case and its conclusion that petitioner made a substantial change in its operations, ...


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