Cordano's Appeal , 91 Conn. 718 ( 1917 )

The stipulation of counsel upon which this reservation was made limits the questions, whose answers should determine the judgment to be rendered by the Superior Court under our advice, in substance, to two, as follows: (1) Was the county commissioners' action in granting Davis' application for a transfer to him of Sullivan's license, in violation of the provisions of the statute touching licenses for places located within two hundred feet of a church; and (2) was Davis' application a fraudulent one?

Any question that might have been made in the Superior Court, that the county commissioners erred in their exercise of discretion in granting the application, is waived.

It appears to be conceded by the remonstrant appellant, that if Davis had received a transfer from Sullivan his application to the commissioners would not have encountered the church prohibition. Such, certainly, would have been the case, since the passage of Chapter 282 of the Public Acts of 1915, which embodies that prohibition, specially excepts from its operation transfer applications, and leaves the decision in their case to the discretion of the commissioners in view of the circumstances of each particular case.

Davis, however, did not hold an assignment to himself from Sullivan, the licensee. His right to the license came to him from the Yale Brewing Company, which had purchased it upon an execution sale, and had never qualified as a licensee under it. The remonstrant's contention is that under such conditions Davis did not occupy the position of one who was entitled to a transfer of the license within the meaning of our license statutes, and, therefore, could not avail himself of the exceptions provided in Chapter 282 of the Public Acts of 1915 in cases of transfer. His claim is that the exception made in that Act in favor of transfers of licenses, refers only to such as attend the passing of the ownership of the license directly from the licensee to the applicant for a transfer and without the intervention of any other person's ownership of the license, and that all other persons not so deriving title to the license appear before the county commissioners as original applicants and subject to the regulations governing such applicants. In support of this position he points to Chapter 148 of the Public Acts of 1915, where it is provided that any licensee, or in case of his death his administrator or executor, may, with the consent of the county commissioners, transfer his license. This, he says, is inclusive of all transfers which the law recognizes as such, and confines the power to make assignments, which by the approval of the county commissioners may become transfers, to licensees.

This construction of our statute is exceedingly narrow and technical and does not comport with sound reason. It reaches not only those who, as here, are purchasers of a license at an execution sale, but also those who hold voluntary assignments from the owner of a license, provided they have not put themselves in a position to engage in the liquor business under its authority. We search in vain for a practical reason for the distinction thus made between licensed and non-licensed owners of a license, in the matter of their competency to make an assignment of the license which may be perfected as a transfer by the action of the county commissioners. Especially hard is it to find a reasonable basis for such distinction, since ownership by purchase and assignment does not carry with it the right to utilize the license in the conduct of the business. In every case, one who acquires an outstanding license is required to obtain the approval of the county commissioners before he can sell under it. As the license authorities have reserved to them the power to dictate as to who, among assignees, may exercise the franchise by becoming sellers, and are called upon in every case to exercise that power, it is difficult to discover what abuse can possibly arise from making assignees of non-licensed persons transferees of the license, which is not to be anticipated in the case of assignees of licensed persons. The public interest is not concerned with the character and suitability for the conduct of the liquor business of a vendee of a license who does not propose to operate under it. What is its vital concern is the character and suitability of one who applies for leave to sell under it.

Our law recognizes to the fullest extent the quality of property in a license. It is property having a recognized pecuniary value and the subject of sale, attachment, levy, or replevy. Sayers' Appeal, 89 Conn. 315,317, 94 A. 358; Quinnipiac Brewing Co. v. Hackbarth,74 Conn. 392, 395, 50 A. 1023. As property and the subject of sale, the owner may prima facie at least sell it and place the purchaser in his position as owner. What is there to impose restraint upon this power of substitution of owners, so that only one class of them, to wit, those who have qualified as licensees under the license are free to make the substitution as fully and completely as the law in other respects permits it to be made? The statutes impose none expressly, and none is to be found by way of implication unless the remonstrant's construction of Chapter 148 of the Public Acts of 1915 is to be accepted as correct. As we already have had occasion to observe, practical reasons in support of that construction are not apparent. On the other hand, it is easy to discover reasons, and cogent ones, in opposition to it. We are of the opinion that the owner of the license, whether or not he has qualified to sell under it, may sell and assign it as a piece of property to another who may make application to sell under it as a transferee.

But the remonstrant is not driven to rely upon the broad proposition just discussed. He advances a more narrow one based upon that portion of Chapter 36 of the Public Acts of 1915, which provides that a license sold upon execution shall for its unexpired term be as valid in the hands of its purchaser as in the hands of the original licensee, "provided before such purchaser may avail himself of the benefit of such license, he shall comply with all the requirements of law relative to the procuring of an original license." His claim is that here, by implication at least, is a direction that an execution purchaser, and of necessity therefore his assignee, must, if he would avail himself of any beneficial use of the purchased license, appear before the county commissioners in all respects as an original applicant and be governed by all the statutory regulations concerning the granting of licenses to such applicants. As one of these regulations is the prohibition of the issuance of a license to sell at a place located within two hundred feet of a church edifice, he says that it follows that an execution-purchaser applicant comes within the operation of that prohibition.

He is, of course, correct in his statement that an assignee of an execution purchaser can stand in no better position, as an applicant for leave to sell, than would his assignor if he were making such application. If it be so that the law provides a special rule for the case of an execution purchaser, so that he is made to occupy a different and less advantageous position when he seeks to utilize his purchase by qualifying as a seller, from that occupied by voluntary assignees of licensed persons, then, without doubt, every owner under him of the license stands in no better position. The controlling question, therefore, is, does our law make execution purchasers a class apart from all other purchasers and subject them, when they seek to avail themselves of their purchases, to different and more stringent regulations than those to which all other purchasers are subjected?

In answering this question the particular statutory provision which alone is relied upon as accomplishing that result, should be read in connection with the other provisions touching the same general subject, and such construction, consistent with the language used, given to it as will make a harmonious and consistent whole. In arriving at that construction, the evil sought to be avoided should be borne in mind.

The evil which our law governing transfers of license privileges seeks to avoid, manifestly is the sale of spirituous and intoxicating liquors by persons whose fitness to do so has not been passed upon and approved by the licensing authorities. Our policy in that regard is clearly indicated by our statutes. We insist that every would-be seller shall present his application for leave to sell to the county commissioners, and that they, after a formal hearing upon a prescribed notice, shall pass upon his fitness to exercise the desired privilege. This requirement extends to everyone, whether he be an original applicant or one desiring to sell as a substitute licensee.

When the applicant seeks to exercise the right which was originally given to another, a transfer of the license becomes necessary. That transfer is not accomplished by a purchase and assignment of the license. It is accomplished when, and only when, the county commissioners have signified their consent to the substitution of licensee. Public Acts of 1915, Chap. 148. Our statutes make it clear that the word "transfer," as used in them, refers not to the transaction as between individuals whereby the property interest passes, but to the transfer of the right to sell which follows the county commissioners' consent. It matters not whether the license, as representing an inchoate right to sell, was obtained by a third party through a voluntary assignment, or upon execution sale. There is no "transfer" within the meaning of our statutes, until the county commissioners have given their consent to the substitution of parties, and there is one in either case when that consent is given.

Bearing in mind that fact, and also that Chapter 282 of the Public Acts of 1915, the latest in the order of enactment of the license statutes, in unrestricted language exempts transfers from the operation of the prohibition against the grant of licenses for a place located within two hundred feet of a church edifice, and also that no reasons are apparent for the making of a distinction between purchasers of different classes, it is reasonably manifest that the two statutory provisions should be read, the one as prescribing the applicant's course of action, and the other the county commissioners' duty in passing upon his application when duly presented. By force of Chapter 36 of the Public Acts of 1915, the applicant must proceed in the matter of application in all respects as an original applicant is required to do. By virtue of Chapter 282 of the Public Acts of 1915, the county commissioners, in passing upon the application when thus presented, are to be governed by the regulations touching transfers.

The remonstrant's claim, that the plaintiff's application was fraudulent, is based largely upon his assumption of an alleged false position in asserting that he desired a transfer of Sullivan's license, and in asking for such transfer when he was in no position to claim it. What we have said upon that subject disposes of that feature of the charge of fraud. The charge is also based in part upon the fact that at the time the application was made the Yale Brewing Company had not in fact perfected its assignment to the applicant, although it was perfected prior to the hearing before the commissioners. Nowhere in the application, or in the applicant's affidavit accompanying it, is it said that the assignment had been made. The application was for a transfer of Sullivan's license to Davis, and nothing more. We discover no misrepresentation of fact by Davis, nor possibility of misunderstanding or misconception on the part of the commissioners as to any material matter involved in their decision. It does not appear but that the situation was fully understood by all, and it is of no practical importance whether or not the assignment to Davis was in form executed at the date of the application.

The Superior Court is advised to affirm the order of the county commissioners.

No costs in this court will be taxed in favor of either of the parties.

In this opinion the other judges concurred.