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City of Montgomery v. D&L Enterprises, Inc.

Alabama Court of Civil Appeals

September 13, 2019

City of Montgomery
D&L Enterprises, Inc., d/b/a Larry's Trading

          Appeal from Montgomery Circuit Court (CV-18-901629)

          THOMPSON, Presiding Judge.

         The City of Montgomery ("the city") appeals from a judgment of the Montgomery Circuit Court ("the circuit court") reversing a decision by the Montgomery City Council ("the council") denying D&L Enterprises, Inc., doing business as Larry's Trading ("Larry's"), a license to sell liquor for off-premises consumption. In reversing the council's denial of the license, the circuit court determined that the council's decision was arbitrary and capricious.

         The record indicates the following. In the spring of 2017, Larry's applied for a Lounge Retail Liquor - Class II (Package) license for the purpose of operating a package store--i.e., a liquor store--at a location on Old Selma Road. That location is in Montgomery County ("the county") but is also within the city's police jurisdiction. Several city and county agencies responded to the application, including the city's planning-control department, which advised the council that a liquor store was permitted at the location for which Larry's was seeking the license. The county sheriff's department notified the city clerk's office that it had no concerns about the operation of the proposed package store, as long as there was no drinking on the premises. However, the sheriff's department subsequently revised its recommendation, stating that it had received complaints from citizens in the area about the operation of a package store at the proposed location and that if those citizens were opposed to the operation of a package store, then so was the sheriff. The city police department opposed the granting of the license, but it gave no reasons for its opposition at that time.

         On September 5, 2017, the council held a public hearing to consider Larry's application. At that time, the council tabled consideration of Larry's liquor-license application indefinitely. In July 2018, the council decided to take up the matter again, and it scheduled a public hearing for August 7, 2018. The record indicates that, before the public hearing, county commissioner Elton N. Dean, in whose district Larry's package store was to operate, did not oppose the issuance of the license, but he did not elaborate on his reasoning. A July 26, 2018, memorandum from a Montgomery police officer to the Montgomery police chief stated that the council president, Charles Jinright, opposed the approval of the application because "the community was opposed" to the liquor store. The memorandum indicated that the "Special Operations Division" of the police department "DOES have a concern about this application." However, no specific reason for the opposition was given. The memorandum also noted that there had been no fights, shootings, stabbings, or disturbances at the location in the previous two years, although, it stated, the sheriff's department had responded to several thefts there. The police department also advised the council that Larry Green, the owner of Larry's, had no record of arrests or outstanding warrants.

         On August 2, 2018, Sheriff Derrick Cunningham sent the council a letter stating that Larry's advertised that it sold fireworks, vehicles, and household retail items, among other items, and that it engaged in buying, selling, trading, and pawns. Sheriff Cunningham wrote: "It would appear that according to law, [Larry's is] ineligible for a liquor license due to the inventory being sold, which has been confirmed with the Alabama ABC Board." He also referred the council to a memorandum attached to the letter from a deputy who had canvassed the neighborhood within a 2, 000-foot radius of where Larry's package store would operate to seek neighbors' opinions on whether the application should be granted. A number of neighbors opposed the application for many reasons. Among the reasons given were that a liquor store was "likely to bring trouble" to the neighborhood where children lived, that the liquor store would be near the entrance of a residential neighborhood, and that there were already a sufficient number of establishments that sold beer and wine in the area and thus a liquor store was not needed at the Larry's location. One resident expressed a concern about an increase in traffic, and another was concerned about whether there would be sufficient parking. Several residents expressed opposition to alcohol in general. A representative of the Magnolia Woods group home for the mentally challenged, which lies within the area the deputy canvassed, objected to the approval of the application because of the proximity of the group home to the proposed location of Larry's package store.

         The deputy's memorandum indicated that there were four churches in the area. The two closest were each 3/10 of a mile from the proposed location of Larry's package store; the farthest was 1.4 miles away. An elementary school is located two miles from the proposed location of Larry's package store.

         The city health department had no issues with Larry's application, and the city finance department advised that Larry's owed no outstanding taxes.

         Council minutes reflect that, at the August 7, 2018, public hearing, several residents spoke in opposition to the application. Green, the owner of Larry's, was not present at the public hearing, but his attorney spoke on his behalf. The attorney advised the council that the package store would be separate from the pawn shop that Larry's currently operates at the same location. The attorney also said that the pawn shop would not sell weapons.

         The council voted on Larry's application at its August 21, 2018, meeting. At that meeting, one of the residents who had spoken against approval of the license presented the council with a petition signed by 117 homeowners in the area who were also opposed to approval of the license. Five members of the council voted to deny the application; three abstained from voting. No one voted in favor of the application.

         Montgomery is a Class 3 municipality.[1] Thus, where, as here,

"'there is no statutory right of direct appeal from a local government's decision to deny an application for a liquor license, the only proper method of judicial review is by the common-law writ of certiorari'[]; but see §§ 28-1-6 and -7, Ala. Code 1975 (providing a statutory direct appeal from the denial or approval of a liquor license by certain municipalities)."

Montgomery City Council v. G & S Rest., 98 So.3d 1, 1 (Ala. Civ. App. 2011)(quoting Phase II, LLC v. City of Huntsville, 952 So.2d 1115, 1119 n.3 (Ala. 2006)). Accordingly, On September 5, 2018, Larry's filed a petition for a writ of certiorari in the circuit court challenging the council's denial of its application. The parties submitted briefs to the circuit court in support of their respective positions. It is unclear from the record whether a hearing was held. On April 11, 2019, the circuit court entered its judgment finding that the council's decision was arbitrary and capricious, and it set aside the denial of the license. In its judgment, the circuit court approved the license. The city timely appealed to this court.

         On appeal, the city argues that the circuit court's determination that the council's decision was arbitrary ...

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