Untitled Texas Attorney General Opinion ( 1966 )

THEATTORNEY GENERAL
OF EXAS
AUSTIN. TEXAS 7S111
May 26, 1966
a-l 252
Honorable Colc&R. Stevenson, Jr. Opinion No. C-693
Administrator
Texas Liquor Control Board Re: Under the Texas Liquor
Austin, Texas Control Act, whether a
fraternal club or vet-
erans club Is authorized
to serve alcoholic bev-
erages already owned by
a member of such club to
such member and receive
a service charge there-
for without first ob-
taining a private club
registrationpermit and
Dear Mr. Stevenson: related questions.
In your request for an opinion of this office, you have
called our attention to various sections of the Texas Liquor
Control Aot (Articles666-l et seq. and 667-l et seq., Vernon's
Penal Code) with reference to prohibited "sales" and the per-
lalasibleact "to serve" alcoholic beverages as follows: Para-
666-3; Article 666-4, paragraphs
Article 666-15(e),paragraphs 5,
Code Article numbers are,used
ParagraphB2J of Article 666-15(e)
provides that:
nothing in Section
tick i &tlcle
Texas Liquor Control Act
Fraternal or Veterans Clubs."
You then state in your request:
"In order to reconcile the above stat-
utes the Texas Liquor Control Board has
dlatlngulshedbetueen an act of serving
an alcoholic beverage owned by a member of
a club to such member for a service charge
and an act of selling an alcoholic beverage
owned by the club or an employee of the
club to any person whether a member or not
for a price. The Board has permitted the
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Honorable Coke R. Stevenson, Jr., Page 2 (C-693)
holder of a Private Club RegistrationPermit
to serve alcoholic beverages already owned
by mer of such club to such member and
his family and his guests and to charge a
service chapge therefor. However, the Texas
Liquor Control Board has taken action to can-
cel a Private Club Registrationpermit when
the holder thereof has sold any type or al-
ooholic beverage to any-son whether a
meaber or not.
"Prior to your opinion MO. c-622 the same
distinctionwas made with reference to Ra-
ternal Clubs and Veterans Clubs. That Is to
SSJ, a Fraternal Club or a Veterans Club was
permitted to serve an alaohollc beverage al-
ready ownedb-ember of such club to such
member for a service charge. However, Fra-
ternal Clubs and Veterans Clubs were asked
to rerrafn from selling alcoholic beverages.
"Arter your opinion No. c-622 questions
have arisen, because the writer of such
opinion did not make the distinctionabove
stated."
Your request asks the opinion of this office on the fol-
louing questions8
*1. Is a Fraternal Club or Veterans Club
authorized to serve alcoholic beveragea al-
ready owned bynmber of such club to such
aember and receive a service oharge therefor
without fl.Fsthaving obtained a Private Club
RegistrationPermit?
“2. Does Section 3 of Article I rtlcle
666- of the Texas Liquor Control AC
q prohibit
IiPsternal Club or a Veterans Club iron aell-
``distllled spirits by the drink to any-
“3. Does Section 4, (a) of Article I
rtlole 666-=4(a of the Texas Liquor Con-
6rol Act prohlb2 a Fraternal Club or a
Veterans Club from liquor to any
person without firs obtained a per-
mit authorfzlngthe sale of IlqbtOr?
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Honorable Coke R. Stevenson, Jr., Page 3 (c-693)
:‘4..Does Section 3 of Rrtlclc II fi-
tlcle 667-T of the Texas Liquor Control
Act prohl6it a Fraternal Club or Veterans
Club from 3elllng beer to any person with-
out first having obtained a license author-
izing the sa.leof ,beer?
”5. Doe3 Section 4, (b) of Article I
Ki;ticIe666-4, paragraph (g oi’the Texas
tFquor Control Act prohlblt a Fraternal Club
oi’Veteran3 Club from sellln6 liquor or beer
in a dry area to any peroon?
AnsNerlng your questions In the above sequence, the first
cues tlonIs answered “Yes.” A Fraternal or Veterans Club In
not excluded from the right to Serve alcoholic beverages al-
ready owned by such a club memb=d to receive a service charr;e
‘ihercforwithout first having obtained a Private Club Regietra-
tlon Permit.
This office previously held In ItsOplnlon No. C-622
1966) that Fraternal or Veteranc Club3 are “exempt” and not
sexcluded” from the provisionsof Article 666-15(e); that
the3e clubs are not required to obtain a permit and are not in
violation of the Iaw,or acting illegally in serving alcoholic
beverages to their members on their premises without a llcer!3e
or permit.
Paragraph 5 of Article 666-15(e) provides, in part, as
-i”ollows
(emphasisours):
“5. A Private Club RegistrationPermit
shall permit alcoholic beverage3 owned
by’members of the club to be stored, po33esred,
ml;:ed,or consumed and served by the drink . . .
on club premises, but om or to members
ownlyg such alcoholic beverages or such mem-
bcrs families or their guests; . . .’
Paragraph 7 of Article 666-15(e) provides, In part, a3
f3llows:
“7. The Board or Administratormay can-
cel . . . any Private Club RegistrationPer-
mit . . . upon finding that the permittee
Club has:
“(a). Sold . . . any liquor wha,t-
soever 30 as to constitutean open
saloon as defined in Section 3 of
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Honorable Coke R. Stevenson, Jr., Page 4 (C-693)
the Texas Liquor Control Act."
A holding that Veterans or Fraternal Clubs are excluded
and not entitled to the permissive benefits of such law In
operating a private club would necessarily involve an uncon-
stitutionalstatutory construction,rendering the statute to
that extent Illegal class legislation. Attorney General’s
Opinion No. c-622 (1966), page 3. We also attempted to make
It clear in th8t Opinion at the bottom of page 1(that:
"This opinion shall not be construed
to mean that the veterans and fraternal
organizationsare exempted from other
provisions of the Texas Liquor Control
Act. . .‘I
These other provisionswill be hereinafterdiscussed In con-
nection with our answer to your remaining questions.
In answering your remaining questions 2, 3, 4 and 5,
we will group these related questions together for discussion
8nd anawer, and particularlyIn view of the fact that our
an3wer Is “Yes” to each of them.
Article 666-3 does prohibit a Fraternal Club or Vet-
erans Club from sellln distilled spirits the drink to any
uerson. However+ ra ernal and veterans c bs mav serve al-
coholic beverages to Its members and guests witboLt first
having obtained a permit a8 provided In Article 666-15(2),
Vernon's Penal Code.
Paragraphs (a) and (b) or Artiolo 666-3 provide as
r0il0w3 (emphasisours):
"(a). The term ‘open saloon8 a.3 used
In this Act, means any plaoe where any al-
coholic beverage whatever, manufacturedIn
whole or In part by means of the process of
dlstlllatlon,or any liquor composed or com-
pounded in part of distilled spirits, 13
sold or offered for sale for beverage pur-
poses by the drink or broken or unsealed
containers,or any place where any such
liquors are sold or offered for sale for
human consumptionon the premisenere
a.
"(b). It shall be unlawful for any
person, whether as principal,agent, or
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.
Honorable Coke R. Stevenson, Jr., Page 5 (C-693)
employee, to operate or assist In opera-
ting, or to be directly or indirectly
Interested in the operation of any open
saloon in this State.”
Paragraph (a) of Article 666-4 prohibits a Fraternal
or Veterans Club from selllna llauor to anv oe~son without
first having obtained a ,ermitto sell liquor. It expressly
provides, in part, as fol ows !mphasisours):
+=G
“(a). It sha;l.l;eunlawful for any
person to . . any liquor In
any wet area without %si having procured
a Permit of the class required for such
privilege.”
Article 667-3 prohibits a Fraternal or Veterans Club
from selling beer to any person without first having obtained
a license authorizing the sale of liquor. It expressly pro-
vides, in part, as follows (emphasisours):
“It shall be unlawful for any person
to . . . sell any beer . . . within this
State wit- having first obtained ap-
propriate license as herein provided, . . .”
Paragraph (b) of Article 666-4 prohibits a Fraternal
Club or Veterans Club from selling liquor or beer in a dry
area to any person. Its express provisions read in part
(emphasisours):
“(b). It shall be unlawful for any
person in any dry area to . . sell
any liquor, distilled spirm
whiskey, gin, brandy, wine, rum, beer
or ale.
We approve and are in agreement with your administrative
interpretation,construction,and practice under the above
cited statutes distinguishingbetween the act of servin
hollc beverages owned by a member of a club to sue-r---E
mem er
alco-
for
a service charge and the entirely separate act of sellin$ such
beverages owned by the club, or one of its employees or agents,
to any person, whether or not a member, for a price. Such act
of serving beverages owned by the club member, to him, his
fam’ilyand guests, whether the club be one with a private club
registrationpermit or a Fraternal or Veterans Club not re-
quired to have such permit, Is entirely legal. The act of
sellin& such beverage owned by the club, or one of its employ-
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.
Honorable Coke R. Stevenson, Jr., Page 6 (c-693)
ees, to a club member, or any other person, for a price is
megal as shown by the above cited statutes. This consistent
departmentalor administrativeconstructionhas been followed
since 1961, when Article 666-15(e) became effective. It will
ordinarily be given great weight and adopted by the courts as
a part of the law Itself under such circumstances. 53 Tex.
Jur.2d 259, 263, Statutes, Sec. 177; State v. Rarrls, 342
S.W.2d 177 (Tex.Civ.App.1960, no history). F th the
Legislature has twice met in regular session aZ m%YE'deem-
ed to have acquiesced in and accepted such Interpretationun-
der the above authority.
This distinctionand Interpretationarises from the ad-
dition of Article 666-15(e) to the Liquor Control Act, by the
Fifty-SeventhLegislature in Regular Session (H.B. 892, ch.
262, Sec. 1, p. 559), wherein a regulatory system Involving
permits was set up for 'Private Clubs", and both a "Locker
System" and "Pool System" were recognized as being legal, the
latter only in "wet areas. Prior to 1961, only the locker
system was recognized as a legal means of operation to avoid
what might otherwise have been deemed a mere shift or device
to evade the law prohibiting"sales."
In Opinion No. V-203 (1947), this office held that
normally when.individualmembers furnished their funds to an
officer of a private club, whether in a "wet" or "dry" area,
such liquor became the common property of the club. There-
after, when a drink Is delivered by the steward to a member
and paid for in the manner provided by the club, an illegal
sale resulted b the club to the member, violating Article
ES6-3# para. (aT . See also in this connectionour Opinions
s. O-1145 (1939), O-7139 (1946) and R-1221 (1948);Krnavek
v. State, 41 S.W. 612 1897);
s.w.-506 (Tex.Crim.
(Tex.Grim. 1912); Bsckues
App. 1949, error r--urban Club Inc. v. State,
222 S.W.2d 321 (Tex.Clv.App.19w error ref. n..r.re
v. Harris, supra; State v. Garcia: 348 S.W.2d 231 (Tex.E
APP., 1961, no his ory ; and Texas Liquor Control Board v.
Tishlias, 351 S.W.2d 562 (TexmApp. lgbl, error ref. n.r.e.).
However, In Opinion No. V-203 (1947), supra, this office
recognized a significantdistinctionbetween a method of opera-
tion involving an illegal sale, wherein the member was deemed
to have bought the club's liquor, and a method of legal operas-
tlon not involvinga sale, wherein the member may be said to
have simply been delivered or served his own liquor under the
locker system, wherein we stated:
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Honorable Coke R. Stevenson, Jr., +ge 7 (C-693)
"We wish to point out that the method
of operation involved here is to be dla-
tingulshed from the one . being used
over the state, wher;?individ,ual
iockers a.reprovided for the members ~of
the club. In those situations, there would
not be a sale of liquor, and it would not
be purchased by the treasurerout of funds
belonging to the club thereby becoming the
property of the club."
This distinctionand practice was recognizedb the
Legislature
. in 1961, when in
_ addieg Article 666-15(e 7 they
sougnt to recognize not only the "Locker System" in scbpara-
graph (b) but also the "Pool System" In subparagraph(c) as
follow3:
"(b). 'Locker System' shall mean that
system of alcoholic beverages storage where-
by the club rents to its members lockers
wherein the member may store alcoholic bev-
erages for consumptionby himself or his
guesta. All such alcoholic beverages so
stored under the 'lockersystem' shall be
purchased and owned by the member as an ln-
dlvidual.
"(C). 1Pool System' shall mean that
system of liquor storage where all mem-
bers of the pool participateequally in
the purchase of all alcoholic beverages
and the replacementof all alcoholic bev-
erages 13 paid for by moneys a,ssessedand
collected In advance from each member
equally. Such pool system shall be legal
only in an area which has been voted 'wet'
for all alcoholic beverages by the majority
of voters at an election held under local
option."
In connectionwith the above quoted subparagraphs(b) and (c),
we have previouslyquoted paragraph 5 of Article 666-15(e),
authorizinga permit, which gave legal sanction to the practice
of club members to store, poasess, mix, consume, and to be
served their liquor by the drink on club premises. Through
the "Pool System" members could thereby own their liquor serv-
ed to them in the private olub, defined and regula.tedin sub-
paragraph (a) of Article 666-15(e).
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Honorable Coke R. Stevenson, Jr., Page 8 (C-693)
It is, therefore, the opinion of this office that by
reason of the statutory change above noted, the previous
opinions and case authorities cited, as applied to the "Pool
System", do not control the interpretationto be given to the
new law. We fully concur in the administrativepractice and
interpretationgiven by your Department to the new law since
It beoame effective in 1961. Fraternal or Veterans Clubs
are not authorized to "sell" alcoholic beverage3 without ob-
taining a permit to sell, but they are authorized to "serve"
the members' liquor to them and receive a service charge
therefor under Article 666-15(e), through the use of the
looker or pool system, without obtaining a permit, such meth-
od not being deemed a sale within the ambit of the statute.
In the summary of our Opinion No. c-622 (1966), supra,
which Is technicallynot a part of the Opinion, we inad-
vertently and erroneouslyused the word selling" when we in-
tended to use the word "serving." We, therefore,by this
Opinion amend the Summary of Opinion No. c-622 so that It
shall hereafter read as follows:
"Fraternalor Veterans Clubs are exempt
F;mCthe provisions of Article 666-15(e),
. . ., and are not in violation thereof
or acting illegally In serving alcoholic
beverages to its members on its premises
without a license or permit as provided for
and required in such law for those not 30
exempt from Its provision3or requirements."
SUMMARY
Fraternal or Veterans Clubs are
authorized to serve alcoholic bev-
erages already owned by a member of
such club to such member and receive
a service charge therefor without
having first obtained a Private Club
RegistrationPermit. Article 666-3
and aragraphs (a) and (b) of Article
666-g and Article 667-3, Vernon's
Penal Code prohibit Fraternal or Vet-
erans Clubs from selling liquor or
beer to any person without first hav-
ing obtained a license or permit to
so sell the same. The administrative
constructionof the law and practice
thereunder is correct in dlstlnguish-
ing between t-h;33egal act of serving
Honorable Coke R. Stevenson, Jr., Page 9 (c-693)
alcoholic beverages owned by a
member of a club to such member
for a service charge and the ille-
gal act of "selling" such beverages
owned by the club, or employee or
agent, to any person whether a mem-
ber or non-member for a price. The
use of the 'Locker System" or "Pool
System" as provided for in Article
666-15(e), Vernon's Penal Code,
does not constitutean Illegal "sale",
such method being in conformityto
and not an evasion of the statute.
Summary of Opinion No. c-622 (1966)
13 hereby amended a3 set out in this
Opinion.
Yours very truly,
WAGGONER CARR
Attorney General of Texas
Assistant Attorney General
KBT/dt
APPROVED:
OPINION COMMITTEE:
W. V. Geppert, Chairman
Gordon Cass
Robert Flowers
J. C. Davis
John Pettit
APPROVED FOR THE ATTORNEY GENERAL
By T: B. Yright
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