Harry Joseph Pollack and Arthur Morton Pollack v. Joy R. Simonson

Appellants, who currently hold a “class A” retailer’s liquor license, applied on February 20, 1964, to the Alcoholic Beverage Control Board for permission to transfer their premises. A week earlier, on February 14, the Trio Bev■erage Company had asked permission to transfer its licensed premises to a location close to that requested by appellants. Public hearings for Trio’s application were held on March 11, and for appellants’ application on March 18. Appellants were present at the Trio hearing .and their attorney stated that they “offered no protest” to that application. On April 8, the Board granted Trio’s application. On May 5, the Board denied appellants’ application on the sole ground that the Trio license had been “issued for another location less than 300 feet from [appellants’] proposed location, [so that] it would not be in the best interests ■of the persons residing or owning property in the neighborhood to grant another such license.” No one had suggested either at the Trio hearing or at appellants’ hearing that the two applications were mutually exclusive, and no formal regulation under the statute requires that liquor stores be situated more than 300 feet apart.1

We hold that the Board failed to give proper notice to appellants that it considered their application and Trio’s mutually exclusive. The statute provides that the Board may “[consider] the character of the premises, its surroundings, and the wishes of the persons residing or owning property in the neighborhood * * 2 in reviewing an application. Under this provision, the Board might properly find that two liquor stores within 300 feet proximity are inappropriate for a particular neighborhood.3 But where the Board makes such a finding which affects simultaneously pending applications, the Board must necessarily choose between competing applicants. Unless these applicants are aware of their mutual exclusivity, the Board is deprived of any assistance from them in finding rational grounds to distinguish among them.4 Thus the statutory purpose — that specific public standards, not unbridled discretion, should control the Board’s consideration of license applications — is jeopardized unless the Board gives each applicant some opportunity to show that his application should be favored.

The Board may, in its discretion, hold formal comparative hearings, or follow some other procedure to inform itself in choosing between mutually exclusive applicants. In Federal Home Loan Bank Board v. Rowe, 109 U.S.App.D.C. 140, 284 F.2d 274 (1960), this court refused to require formal comparative hearings for choice between mutually exclusive applicants because the statute there did not explicitly provide for any hearing before denial of an application.5 Similarly, the Alcoholic Beverage Control Act does not explicitly require a hearing before denial.6 But in Rowe, unlike here, the appellants were aware, when appearing before the Bank Board, that their license application and others might be mutually exclusive, and they had the opportunity expressly to argue to the Board that “they possessed ‘more suitability for managing and handling a Federal Savings and Loan Association than’ ” the other applicants. 109 U.S.App.D.C. at 142, 284 F.2d at 276.

For the foregoing reasons, the judgment of the District Court is reversed and the case remanded with instructions to enter judgment for appellants, directing the Alcoholic Beverage Control Board to conduct further proceedings consistent with this opinion.

So ordered.