Mirabile Corporation v. Va. Alcoholic Bev. ( 2003 )

COURT OF APPEALS OF VIRGINIA
Present: Chief Judge Fitzpatrick, Judges Annunziata and Clements
Argued at Alexandria, Virginia
MIRABILE CORPORATION, T/A
CHAPPARRAL MEAT MARKET III
MEMORANDUM OPINION* BY
v. Record No. 2126-02-4 JUDGE JEAN HARRISON CLEMENTS
SEPTEMER 30, 2003
VIRGINIA ALCOHOLIC BEVERAGE
CONTROL BOARD
FROM THE CIRCUIT COURT OF FAIRFAX COUNTY
Gaylord L. Finch, Jr., Judge
Glenn H. Silver (C. Thomas Brown; Silver &
Brown, P.C., on briefs), for appellant.
Carla R. Collins, Assistant Attorney General
(Jerry W. Kilgore, Attorney General;
Francis S. Ferguson, Deputy Attorney General,
on brief), for appellee.
Mirabile Corporation, t/a Chapparral Meat Market III
(Mirabile or licensee) appeals from an order of the circuit court
affirming an order of the Virginia Alcoholic Beverage Control
Board (Board) finding it unlawfully sold alcoholic beverages to an
underage buyer in violation of Code § 4.1-304 and 3 VAC 5-50-10
and imposing sanctions against it under Code § 4.1-225(1)(c). On
appeal, Mirabile contends the circuit court erred in affirming the
Board's order because (1) the administrative hearing officer
failed to follow requisite procedures in conducting the hearing
* Pursuant to Code § 17.1-413, this opinion is not
designated for publication.
and (2) the evidence presented was insufficient to prove it
violated Code § 4.1-304 and 3 VAC 5-50-10. For the reasons that
follow, we affirm the circuit court's judgment.
As the parties are fully conversant with the record in this
case and because this memorandum opinion carries no precedential
value, this opinion recites only those facts and incidents of the
proceedings as are necessary to the parties' understanding of the
disposition of this appeal.
I. BACKGROUND
The Board is charged with enforcement of the laws of the
Commonwealth dealing with the purchase and sale of alcoholic
beverages. Code § 4.1-105. One such law, Code § 4.1-304,
prohibits the sale of alcoholic beverages "to any person when at
the time of such sale [the seller] knows or has reason to believe
that the person to whom the sale is made is . . . less than
twenty-one years of age." In furtherance of its obligation to
enforce this law, the Board, through its enforcement agents, from
time to time conducts "underage buyer operations" to determine
compliance with the statute.
On July 7, 2000, enforcement agents Barbara A. Storm and
David F. Vinson conducted such an operation at the licensee's
place of business in Falls Church, Virginia. As a result of that
operation, the licensee was charged with violating the statute.
At the hearing before the administrative hearing officer,
Storm was the Board's only witness. She testified that, on July
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7, 2000, she and Vinson met with Duncan Keith, a young man who was
seventeen years of age at the time, for the purpose of conducting
an "underage buyer operation." Storm and Vinson reviewed the
"underage buyer program" guidelines for conducting the operation
with Keith, who had previously conducted many such operations for
the agents. In keeping with those guidelines, Keith produced his
identification card issued by the Virginia Department of Motor
Vehicles, which the agents reviewed. The card indicated that
Keith's date of birth was February 23, 1983 and that he would not
be twenty-one years of age until February 23, 2004. At the
agents' instruction, Keith emptied his pockets and gave them all
of his possessions except for the identification card.
At approximately 6:25 p.m., Keith, carrying only his
identification card and money the agents had given him for the
purpose of attempting to buy alcoholic beverages, entered the
licensee's store, followed by Storm. Keith went to the cooler,
selected a six-pack of twelve-ounce bottles of Budweiser beer, and
went to the cash register. Upon a gesture from the clerk, Keith
gave his identification card to the clerk. The clerk, later
identified as Carlo Mirabile, looked at the card and returned it
to Keith. The clerk then sold Keith the beer for the purchase
price of $4.17. Keith left the store.
Agent Storm, who, although not within hearing distance of the
transaction, was able to observe what occurred from approximately
five to ten feet away, then approached the clerk, identified
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herself as an agent of the Board, and obtained his identification.
She exited the store and, after meeting with Vinson and Keith,
prepared a uniform summons for selling alcoholic beverages to an
underage person, which she issued to the clerk. Carlo Mirabile
was subsequently convicted of the offense in criminal court.
On cross-examination, in response to the licensee's questions
suggesting Keith may have engaged in conversation with the clerk
to mislead or trick him about Keith's age or identification, Storm
testified that, prior to the transaction, she and Vinson had
specifically reviewed with Keith the guidelines that required an
underage buyer to answer accurately and truthfully if questioned
about his age. Storm further testified that Keith was an
experienced buyer who knew she was observing him and knew he would
be disqualified from agency service if he engaged in deceptive
conduct about his age.
Agent Storm also testified that she took two photographs of
Keith that evening, one full length and one close-up. Storm
testified the photographs accurately depicted Keith's appearance
that evening. The photographs were subsequently admitted into
evidence. She further testified that she made a photocopy of
Keith's identification card and redacted from it his address and
social security number. After Storm identified the photocopy of
Keith's identification card as an accurate copy, with her
redaction, the hearing officer admitted it into evidence, over
Mirabile's objection.
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Agent Storm also testified that she attempted to contact
Keith to secure his presence at the hearing but was unable to
locate him. Storm stated that Keith's mother told her Keith was
in boot camp in the United States Marine Corps. Storm believed
the boot camp was in North Carolina.
Testifying for the licensee, Carlo Mirabile stated that he
asked Keith for identification because, although Keith was tall
and appeared to be over twenty-one years of age, the store had a
policy of carding anyone purchasing alcoholic beverages if there
was "the least bit of question" about whether the buyer was
twenty-one. Carlo Mirabile indicated that, when Keith handed him
his identification, he thought Keith had given him a driver's
license, but he was not certain. When he looked at the
identification, Carlo Mirabile testified, his eyes were "kind of
blurrious [sic] due to an [automobile] accident [he] had [had]
previous[ly]." "[His] eyes," he went on, "weren't focusing on
[the card] because all the prices that [he] was running on." The
clerk further explained: "When I looked at the ID, it was just so
much commotion going on, and a long line, and everybody hollering
to move along, and I just looked at it, and as I — I
miscalculated." Carlo Mirabile also testified that he did not
recall Keith making any statements about his age or the
identification document he provided to the clerk. Carlo Mirabile
stated that, after Keith left the store and Agent Storm approached
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him, he "realized that [he had] sold the beer to [an] underage"
buyer.
The hearing officer determined that the charge was
substantiated and suspended the licensee's license and privilege
to purchase and sell alcoholic beverages for twenty-five days,
conditioned upon the payment of a civil penalty of $2,000. The
licensee appealed to the Board, which affirmed the decision of the
hearing officer. The Board's decision was thereafter affirmed by
the circuit court, and this appeal followed.
II. ANALYSIS
This case arises under the Administrative Process Act, Code
§§ 2.2-4000 to 2.2-4033. In an appeal from an agency decision,
"the burden is upon the appealing party to demonstrate error."
Carter v. Gordon, 28 Va. App. 133, 141, 502 S.E.2d 697, 700-01
(1998). Judicial review of an agency decision is limited to
determining (1) "[w]hether the agency acted in accordance with
law;" (2) "[w]hether the agency made a procedural error which was
not harmless error;" and (3) "[w]hether the agency had sufficient
evidential support for its findings of fact." Johnston-Willis,
Ltd. v. Kenley, 6 Va. App. 231, 242, 369 S.E.2d 1, 7 (1998). The
review of an agency's factual findings "is limited to determining
whether substantial evidence in the agency record supports its
decision." Avante at Lynchburg, Inc. v. Teffey, 28 Va. App. 156,
160, 502 S.E.2d 708, 710 (1998). Under the substantial evidence
standard, the reviewing "court may reject the agency's findings of
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fact 'only if, considering the record as a whole, a reasonable
mind would necessarily come to a different conclusion.'" Virginia
Real Estate Comm'n v. Bias, 226 Va. 264, 269, 308 S.E.2d 123, 125
(1983) (quoting B. Mezines, Administrative Law § 51.01 (1981)).
"The phrase 'substantial evidence' refers to 'such relevant
evidence as a reasonable mind might accept as adequate to support
a conclusion.'" Id. (quoting Consolidated Edison Co. v. NLRB,
305 U.S. 197, 229 (1938)).
Additionally, in accordance with familiar principles of
appellate review, "we review the facts in the light most
favorable to sustaining the Board's action," Atkinson v.
Virginia Alcohol Beverage Control Comm'n, 1 Va. App. 172, 176,
336 S.E.2d 527, 530 (1985), and "take due account of the
presumption of official regularity, the experience and
specialized competence of the agency, and the purposes of the
basic law under which the agency has acted," Code § 2.2-4027.
However,
even though an agency's findings of fact may
be supported by substantial evidence in the
record, [its decision] may be subject to
reversal because the agency failed to
observe required procedures or to comply
with statutory authority. Thus, where the
legal issues require a determination by the
reviewing court whether an agency has, for
example, . . . failed to observe required
procedures, less deference is required and
the reviewing courts should not abdicate
their judicial function and merely
rubber-stamp an agency determination.
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Johnston-Willis, Ltd., 6 Va. App. at 243, 369 S.E.2d at 7-8
(citation omitted).
A. Procedural Claims
On appeal, Mirabile contends the circuit court erred in
affirming the Board's order because the administrative hearing
officer failed to follow requisite procedures in conducting the
hearing. We disagree.
Mirabile first claims the Board failed to produce Keith as a
witness and, thus, deprived it of the fundamental right, afforded
it by § 1.9(B) of the Rules of Practice of the Virginia Alcoholic
Beverage Control Board, to cross-examine the only witness who
could give direct evidence against it of the circumstances of the
transaction.
Code § 2.2-4020(C) provides, in pertinent part, that "the
parties shall be entitled . . . to conduct such
cross-examination as may elicit a full and fair disclosure of
the facts." As relevant here, § 1.9(B) of the Rules of Practice
of the Virginia Alcoholic Beverage Control Board provides that a
"party shall have the right to cross-examine adverse witnesses
and any agent or subordinate of the board whose report is in
evidence."
Mirabile cites no authority, and we know of none, which
compelled the Board to call Keith as a witness. If the Board
felt it could carry its burden of proof without Keith's
appearance at the hearing, it was entitled to do so. Nothing in
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the Code or the Rules of Practice of the Virginia Alcoholic
Beverage Control Board required it to do otherwise. Code
§ 2.2-4020(C) and § 1.9(B) of the Rules of Practice of the
Virginia Alcoholic Beverage Control Board gave Mirabile the right
to cross-examine any witness called by the Board. Here, the
Board's sole witness was Agent Storm, who, the record reflects,
was fully subjected to cross-examination by Mirabile. Thus, the
relevant provisions of § 1.9(B) and Code § 2.2-4020(C) were
satisfied.
Mirabile next claims the administrative hearing officer
should not have admitted the photocopy of Keith's identification
card into evidence because there was no showing that the original
was not readily available, as required by § 1.9(A)(2) of the Rules
of Practice of the Virginia Alcoholic Beverage Control Board.
Section 1.9(A)(2) of the Rules of Practice of the Virginia
Alcoholic Beverage Control Board provides as follows:
Secondary evidence of the contents of a
document shall be received only if the
original is not readily available. In
deciding whether a document is readily
available, the hearing officer shall balance
the importance of the evidence against the
difficulty of obtaining it, and the more
important the evidence the more effort
should be made to have the original document
produced.
Agent Storm testified that, on the evening in question,
Keith produced the original of his Virginia Department of Motor
Vehicles identification card, which she reviewed and
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photocopied. She identified the photocopy as a true and
accurate copy of the original, subject only to her redaction of
Keith's address and social security number. Keith then retained
the original. Storm told the administrative hearing officer
that she had attempted to secure Keith's presence to testify at
the hearing but was unable to do so. Based on information from
Keith's mother, Storm believed Keith was in boot camp for the
Marines, which was located, she thought, in North Carolina. No
evidence in the record contradicts her testimony.
This evidence amply supports the hearing officer's finding
that the original of Keith's identification card was not readily
available. Thus, the photocopy of Keith's identification card
was properly admissible under § 1.9(A)(2).
B. Sufficiency of the Evidence
Mirabile next contends the evidence presented at the
hearing was insufficient, as a matter of law, to prove it
violated Code § 4.1-304 and 3 VAC 5-50-10. Mirabile does not
dispute that Keith was, in fact, seventeen years of age at the
time of the sale or that its employee sold him beer. Mirabile
argues, however, that the sole evidence against it—the hearsay
testimony of Agent Storm, who was not in a position to know what
identification was presented or what conversation was held at
the time of the sale—was insufficient to prove the licensee knew
or had reason to believe Keith was underage.
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We first note that, in proceedings under the Administrative
Process Act, "[t]he rules of evidence are considerably relaxed
. . ., and the findings of administrative agencies will not be
reversed solely because evidence was received which would have
been inadmissible in court." Bias, 226 Va. at 270, 308 S.E.2d
at 126. Indeed, it is well established that "hearsay evidence
is admissible" at an administrative hearing conducted in
accordance with the Administrative Process Act. See Carter, 28
Va. App. at 141, 502 S.E.2d at 701. "If the agency relies on
hearsay evidence, the court reviewing the sufficiency of that
evidence on appeal may give it the same weight as any other
record evidence." Id.
We next note that, in this case, the Board was required to
prove that Keith, the purchaser of the alcoholic beverage, was
less than twenty-one years of age and that the licensee knew or
had reason to believe he was underage at the time of the
transaction. See Code § 4.1-304; 3 VAC 5-50-10. Upon review of
the agency record, we hold the evidence presented, viewed in the
light most favorable to sustaining the Board's action, was
sufficient to meet that burden.
Agent Storm testified that the only identification Keith
had in his possession when he entered the licensee's store was
his Virginia Department of Motor Vehicles identification card,
which indicated that he was seventeen years of age at the time
and that he would not be twenty-one years of age until February
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23, 2004. Storm further testified that, upon arriving at the
counter with the beer, Keith presented his identification card to
the clerk and that the clerk, after looking at the card, sold
Keith the beer. Although she could not see the exact
identification document Keith produced to the clerk or hear
their conversation, Storm said Keith was an experienced buyer
who knew he was required to be accurate and truthful about his
age or face disqualification from agency service.
The clerk, Carlo Mirabile, testified that, when Keith
approached the counter with the beer, he asked him for
identification and Keith handed it to him. Carlo Mirabile
further testified that he did not recall that Keith made any
statements about his age or the identification document. Carlo
Mirabile acknowledged that, in looking at Keith's identification
card, he miscalculated Keith's age due to his blurred vision and
his anxiety about the long line of waiting customers.
We hold that this testimony constitutes substantial evidence
in support of the Board's decision that Mirabile knew or had
reason to believe that Keith was too young to lawfully purchase
the beer he was sold.
Accordingly, we affirm the circuit court's judgment
affirming the Board's finding that Mirabile unlawfully sold
alcoholic beverages to an underage buyer in violation of Code
§ 4.1-304 and 3 VAC 5-50-10.
Affirmed.
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