Embers of Salisbury, Inc. v. Alcoholic Beverages Control Commission , 401 Mass. 526 ( 1988 )

Hennessey, C.J.

As a result of a hearing held on May 28, 1985, the licensing board of Salisbury (board) found that on July 9,1983, the appellants-licensees¹ (licensees) had violated G. L. c. 138, § 34 (1986 ed.), by serving alcohol to a minor, one Holly Kozec (Kozec), then nineteen years of age. Accordingly, the board voted under G. L. c. 138, § 64, to suspend the licensees’ liquor licenses for three days. Pursuant to G. L. c. 138, § 67 (1986 ed.), the licensees appealed the board’s action to the Alcoholic Beverages Control Commission (ABCC) which, after a de novo hearing on August 1, 1985, upheld the board’s action. The licensees then sought judicial review of the ABCC’s decision. The Superior Court denied the licensees’ motion for summary judgment and granted summary judgment in favor of the ABCC. The licensees appealed from the Superior Court’s judgment, and this court took the case on its own motion. We affirm.

The evidence relied on by the board and by the ABCC in finding that the licensees had served alcohol to a minor consisted primarily of a transcript of the testimony of Kozec, who testified at her criminal trial that she was nineteen years old on July 9, 1983, and that on that date she had been served alcoholic beverages at the licensees’ establishments. The facts of Kozec’s case, which are set forth in Commonwealth v. Kozec, 399 Mass. 514, 515-516 (1987), are relevant to this case only in so far as the licensees argue that Kozec, who was on trial for assault with intent to murder, falsified her testimony regarding her consumption of alcohol in an attempt to establish that she was intoxicated at the time of the alleged crime, and that her self-serving testimony is inherently unreliable. Accordingly, they contend that there is not substantial evidence to support the ABCC’s findings.

The only other evidence before the ABCC consisted of a stipulation between the parties as to the anticipated testimony of seven other witnesses. The testimony of four of these, owners and managers of the licensees’ establishments, would have tended to disprove Kozec’s testimony. The other three, police officers, would have testified that they saw Kozec at the Salisbury police station following her arrest; that she appeared intoxicated; that she told them that she had been drinking that night at the licensees’ establishments; and that she told them that she was underage.²

On appeal, the licensees contend that the ABCC’s decision is not supported by substantial evidence; and that they were deprived of the opportunity to confront and to cross-examine Kozec, in violation of the rights guaranteed them by G. L. c. 30A,- § 11 (3) (1986 ed.), and by the Federal and State Constitutions.

The standard of review by this court of the ABCC’s decision to suspend licensees’ liquor licenses is the substantial evidence test. Saxon Coffee Shop, Inc. v. Boston Licensing Bd., 380 Mass. 919, 924 (1980) (revocation case). Olde Towne Liquor Store, Inc. v. Alcoholic Beverages Control Comm’n, 372 Mass. 152, 153 (1977). We may set aside the ABCC’s decision if it is “[u]nsupported by substantial evidence.” G. L. c. 30A, § 14 (7) (e) (1986 ed.).³ “ ‘Substantial evidence’ means such evidence as a reasonable mind might accept as adequate to support a conclusion.” G. L. c. 30A, § 1 (6) (1986 ed.).

The ABCC’s decision is supported by substantial evidence. The transcript of Kozec’s testimony, admitted without objection from the licensees,⁴ included testimony to the effect that Kozec, who was then underage, had been served alcoholic beverages by the licensees’ establishments. Although the stipulated testimony of the licensees’ witnesses tended to disprove Kozec’s testimony, the ABCC was entitled to believe the one and disregard the other. “It is for the agency, not the courts, to weigh the credibility of witnesses and to resolve factual disputes. ‘A court may not displace an administrative board’s choice between two fairly conflicting views, even though the court would justifiably have made a different choice had the matter been before it de novo.’” School Comm. of Wellesley v. Labor Relations Comm’n, 376 Mass. 112,120 (1978), quoting Labor Relations Comm’n v. University Hosp., Inc., 359 Mass. 516, 521 (1971). See also Universal Camera Corp. v. NLRB, 340 U.S. 474, 488 (1951). This court may not disturb the ABCC’s findings unless our review of the record as a whole fails to disclose substantial evidence to support it. Clearly, the testimony of Kozec, if believed, amply supports the ABCC’s findings, and it is the ABCC, not this court, which is “the sole judge of the credibility and weight of evidence before it during the administrative proceeding.” Number Three Lounge, Inc. v. Alcoholic Beverages Control Comm’n, 7 Mass. App. Ct. 301, 309 (1979).

The licensees argue, however, that the transcript of Kozec’s testimony does not constitute substantial evidence to support the ABCC’s findings, first, because it is inherently unreliable, and second, because uncorroborated hearsay evidence does not constitute substantial evidence under our opinion in Sinclair v. Director of the Div. of Employment Sec., 331 Mass. 101 (1954).

The licensees do not and could not plausibly argue that the ABCC is bound by the rules of admissibility of evidence observed by courts.⁵ Rather, they say that, because Kozec was trying to establish her intoxication as a defense to a serious criminal charge, she had every incentive to lie regarding her procurance and consumption of alcohol. This contention, however, goes to the credibility of and the weight to be given such testimony, a matter squarely within the ambit of the ABCC’s fact-finding responsibility, and we cannot say, as matter of law, that Kozec’s testimony was insufficient to support the ABCC’s findings.

We think that the licensees misconstrue the teaching of Sinclair, supra. Although in that case we said that “[i]f the pertinent evidence is exclusively hearsay, that does not constitute ‘substantial evidence’ even before an administrative tribunal,” Sinclair, supra at 103, the line we were drawing was not between evidence admissible in a court and evidence that. is inadmissible because of the rules of evidence observed by courts, but between evidence having indicia of reliability and probative value and that which does not. The United States Supreme Court similarly advanced the broad proposition that “[m]ere uncorroborated hearsay or rumor does not constitute substantial evidence,” Consolidated Edison Co. v. NLRB, 305 U.S. 197, 230 (1938), but later explained that “[t]he contrast the Chief Justice [Hughes] was drawing [in the above quoted language] was not with material that would be deemed formally inadmissible in judicial proceedings but with material ‘without a basis in evidence having rational probative force.’ This was not a blanket rejection by the Court of administrative reliance on hearsay irrespective of reliability and probative value. The opposite was the case.” Richardson v. Perales, 402 U.S. 389, 407-408 (1971), quoting Consolidated Edison Co., supra at 230.

In this case, as in Perales, the hearsay evidence on which the agency relied was available to either party, and the declarant was “subject to subpoena and to the very cross-examination that the claimant asserts he has not enjoyed.” Id. at 407. The transcript of Kozec’s trial testimony on which the ABCC based its findings, although hearsay, was a record of testimony given by Kozec in open court, under oath, and subject to cross-examination. Although we might reach a different conclusion as to the reliability of Kozec’s testimony were we to consider the matter de novo, we cannot say that the ABCC was in error in assigning probative weight to the transcript of her testimony. Moreover, the stipulated testimony of the licensees themselves and of the police officers corroborated certain particulars of Kozec’s testimony? The licensees would have testified that Kozec was employed as a barmaid by one of their licensed establishments, the Tic-Toc Club; and the police officers would have testified that Kozec appeared to be under the influence of alcohol when they observed her at the police station following her arrest.

The licensees contend that the admission of the transcript of Kozec’s testimony deprived them of the opportunity to confront and cross-examine Kozec in violation of the rights guaranteed them under the Federal and State Constitutions and under G. L. c. 30A, § 11 (3). This contention cannot stand. Under G. L. c. 30A, I 11 (3), the licensees had “the right to call and examine witnesses, to introduce exhibits, to cross-examine witnesses who testify, and to submit rebuttal evidence.” The licensees could have called Kozec⁶ as a witness and examined her regarding the events to which her transcribed testimony related. They were entitled to a subpoena, if necessary, to compel Kozec’s attendance and testimony. G. L. c. 30A, § 12 (3) and (5) (1986 ed.). The licensees chose not to call Kozec and rested on the stipulated testimony of other witnesses. The right to confront and cross-examine adverse witnesses is not self-executing. Having failed to invoke their right to call Kozec as a witness, they cannot be heard to complain of the consequences. Cf. School Comm, of Brockton v. Massachusetts Comm’n Against Discrimination, 377 Mass. 392, 402-403 (1979) (no unfairness where witness failed to appear at administrative proceeding, where aggrieved party failed to pursue right to enforce subpoena compelling attendance and testimony).

Judgment affirmed.

1 Embers of Salisbury, Inc., doing business as Kon Tiki Lounge, and Joseph Grasso, doing business as Tic-Toe Club.

2 Although it is not entirely clear from the licensees’ briefs and arguments, we infer that their position is that the police officers’ testimony as to Kozec’s statements to them suffers from the same infirmity as the transcript. Based on the view we take of the probative value of the transcript, we need not consider the status of Kozec’s statements to the police.

3 The licensees do not contend that the other review standards of G. L. c. 30A, § 7, are applicable to the instant case.

4 The licensees’ position appears to be not that the transcript may not be considered at all, but that it is insufficient to support the ABCC’s findings, i.e., their contention goes not to the admissibility of the evidence but to its sufficiency.

5 General Laws c. 30A, § 11 (2) (1986 ed.), provides that, except where otherwise provided by law, “agencies need not observe the rules of evidence observed by courts .... Evidence may be admitted and given probative effect only if it is the kind of evidence on which reasonable persons are accustomed to rely in the conduct of serious affairs.”

6 The licensees do not claim that Kozec was unavailable to testify, merely that it was not incumbent upon them to produce her at the hearing.