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Board of Liquor License Commissioners for Baltimore Hollywood Productions, Inc. - No. 127, 1995 Term

City

v.

ALCOHOLIC BEVERAGES -- Board of Liquor License Commissioners has standing to appeal an adverse decision of the circuit court. Board may not impose restrictions on the hours of lawful operation of a licensee's establishment.

IN THE COURT OF APPEALS OF MARYLAND No. 127 September Term, 1995 __________________________________ BOARD OF LIQUOR LICENSE COMMISSIONERS FOR BALTIMORE CITY v. HOLLYWOOD PRODUCTIONS, INC. ___________________________________ *Murphy, C.J. Eldridge Rodowsky Chasanow Karwacki Bell Raker JJ. ___________________________________ Opinion by Chasanow, J. ___________________________________ Filed: November 13, 1996

*Murphy, C.J., now retired, participated in the hearing and conference of this case while an active member of this Court; after being recalled pursuant to the

Constitution, Article IV, Section 3A, he also participated in the decision and the adoption of this opinion.

The question presented in this case is whether the Board of Liquor License in Commissioners the for Baltimore of City exceeded its of a

authority

restricting

hours

lawful

operation

licensee's establishment. that this authority. restriction

For the reasons set forth below, we hold beyond the scope of its statutory

was

We also hold, as a preliminary matter, that the Board

of Liquor License Commissioners has standing to appeal an adverse decision by the circuit court.

I. The appellee, Hollywood Productions, Inc. ("licensee")

operates a Class B-D-7 licensed nightclub1 on 32nd Street in Baltimore. In the Fall of 1994, the Board of Liquor License

Commissioners ("Liquor Board") received several written complaints from area residents concerning the patrons of this establishment. The focus of the complaints was the disorderly behavior of

customers exiting the club in the early Monday morning hours when the club closed. The residents reported that club patrons were

disturbing the peace of the neighborhood by yelling and screaming, pounding on vehicles, honking horns, playing loud music, breaking bottles, urinating in public, parking illegally, and engaging in altercations. On more than one occasion, it appears that police

This nightclub has been known by a variety of names. Throughout the course of these proceedings, it has been referred to alternatively as the 32nd Street Nightclub, the New 32nd Street Nightclub, the 32nd Street Plaza, the 32nd Street Phase III Lounge, and the Phase III Inn.

1

-2intervention was needed to control the crowd. The parties agree,

however, that none of the objectionable conduct occurred on the premises of the nightclub itself and that these disturbances were restricted to Monday mornings at approximately 2:00 a.m. In response to the initial community complaints, the Liquor Board charged the licensee with violating Rule 3.12 of the Liquor Board Rules and Regulations and held a hearing to address the matter on November 3, 1994. Rule 3.12 of the Rules and Regulations

of the Board of Liquor License Commissioners for Baltimore City provides: "Licensees shall operate their establishments in such a manner as to avoid disturbing the peace, safety, health, quiet, and general welfare of the community." Upon the conclusion of that

hearing, at which representatives from the community testified, the Liquor Board directed the licensee to meet with local police and residents to ascertain measures that might alleviate the problem and to report the outcome of these meetings to the Board. Club

management complied with this directive and, subsequently, notified the Board that it had: (1) raised the minimum age for admission to

25; (2) upgraded the dress code; (3) discontinued live exotic dance performances; (4) adopted a 1:30 a.m. closing time; and (5) begun announcements encouraging peaceful and quiet egress from the club. On December 29, 1994, the Liquor Board held a "compliance conference" with club management and representatives from the community to assess the progress made toward addressing the

residents' concerns.

It was generally agreed that there had been

-3some improvement. word from a On January 16, 1995, however, the Board received association that conditions had again

community

worsened and that, on the preceding night, there had been twelve police squad cars and two police wagons in the area, several hundred individuals milling about and disturbing the peace, and at least two arrests. The association sent further reports of

disruptive conduct to the Board on January 23, 1995, and January 30, 1995, as well as a formal request that the Board prohibit the nightclub from operating on Sunday evenings. As a result of these communications, the Liquor Board again charged the licensee with violating Rule 3.12 and scheduled a hearing for March 9, 1995. At the conclusion of this hearing, the

Board directed the licensee to close the nightclub at 11:00 p.m. on March 19 and March 26, 1995. In its subsequent written decision

dated April 10, 1995, the Board stated: "The Board strongly feels that it is not in the best interest of the community to continue to permit the Sunday evening to early morning operation [of the nightclub] to remain. Ample opportunity was provided the licensee to correct the complaints to the degree that all parties could live in peace and harmony. It is the consensus Opinion of the Board that this has not occurred and will not occur without specific guidance and direction from this Board. Therefore, effective immediately, the Board orders the licensee to close this premise on Sunday evening at 7:00 p.m. The premise may operate from 12 noon on Sundays to 7:00 p.m. Sunday evening. At that time the premise must close and cannot re-open until

-4Monday morning at 6:00 a.m." original). (Emphasis in

Opinion of the Board of Liquor License Commissioners for Baltimore City (April 10, 1995). The licensee sought judicial review of the Board's decision in the Circuit Court for Baltimore City. The circuit court reversed

on the ground that the restriction of the nightclub's hours of operation exceeded the scope of the Board's statutory authority, and the Liquor Board noted an appeal of this adverse ruling to the Court of Special Appeals. Prior to consideration by the

intermediate appellate court, however, this Court issued a writ of certiorari on its own motion and ordered that the case be docketed for its consideration.

II. As a preliminary matter, we must address whether the Liquor Board has standing to appeal the adverse ruling of the circuit court. The licensee asserts that, pursuant to the decision of this

Court in Liquor License Board v. Leone, 249 Md. 263, 239 A.2d 82 (1968), the Board has no right to appeal the reversal of its decision by the circuit court. In Leone, we did in fact hold that Leone, 249

appeals by a liquor board were not permitted by law. Md. at 267-69, 271, 239 A.2d at 85-86, 87.

Subsequent developments

in both statutory and case law, however, undermine Leone's present applicability.

-5At the time that Leone was decided,

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