STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS REGULATION, ) DIVISION OF ALCOHOLIC BEVERAGES ) AND TOBACCO, )

)

Petitioner, )

vs. ) CASE NO. 89-1357

)

EDM OF KEY WEST, INC., )

d/b/a PORTSIDE, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, Claude B. Arrington, held a formal hearing in the above-styled case on June 16, 1989, in Key West, Florida.

APPEARANCES

For Petitioner: Harry L. Hooper, Esquire

Department of Business Regulation 725 South Bronough Street, Tallahassee, Florida 32399-1007

For Respondent: James T. Hendrick, Esquire

Morgan & Hendrick, P.A. Post Office Box 1117 Key West, Florida 33041

STATEMENT OF THE ISSUES

Whether the Respondent failed to have the seating capacity required of a licensee in its category as alleged by the Notice to Show Cause and, if so, what disciplinary action should be taken.

PRELIMINARY STATEMENT

The Notice to Show Cause served on Respondent by Petitioner contains two errors which were corrected by agreement of the parties. First, the Notice to Show Cause alleges a violation of Rule 7A-3.015, Florida Administrative Code, but it fails to allege a violation of Rule 7A-3.014, Florida Administrative Code. Second, the Notice to Show Cause alleges a violation of Section 561.20(2)(a)3, Florida Statutes, instead of Section 561.20(2)(a)4, Florida Statutes, the correct statutory reference.

At the final hearing, Petitioner presented the testimony of one witness and introduced three documentary exhibits, which were accepted into evidence.

Respondent presented the testimony of three witnesses and introduced one

documentary exhibit which was accepted into evidence. Official recognition was taken of the pertinent rules found in Chapter 7A, Florida Administrative Code.

No transcript of the proceedings was ordered. The parties' proposed findings have been addressed in the appendix to this recommended order.

FINDINGS OF FACT

1. At all times pertinent hereto, Respondent, EDM of Key West, Inc., d/b/a/ Portside, was the holder of a special restaurant license issued by Petitioner, Division of Alcoholic Beverages and Tobacco, Department of Business Regulation. This license, Series 6-COP, Number 54-00999SRX, authorizes Respondent to sell alcoholic beverages, subject to regulation by Petitioner and other authorities, in conjunction with its restaurant business.

   
   

2. On November 16, 1988, Petitioner's law enforcement investigator, David Myers, inspected Respondent's premises to determine whether Respondent was in compliance with the regulations applicable to licensees such as Respondent. Two violations were discovered. The first was that the establishment failed to have sufficient seating for patrons under the covered portion of the premises. The second was that the establishment failed to keep adequate records of its sales of food and of its sales of alcohol as required by regulation. Official Notices were issued by Petitioner to Respondent for both violations.

   
   

3. Investigator Myers told Respondent's dining room manager on November 16, 1988, that the establishment was required to have seating sufficient for at least 150 dining patrons under a permanent roof and that the seats located outside the roofed area could not be counted toward that requirement. This advice is consistent with Petitioner's interpretation of Rule 7A-3.014, Florida Administrative Code.

   
   

4. Prior to December 12, 1988, Investigator Myers advised the management of Respondent that he intended to make a follow-up inspection on December 12, 1988.

   
   

5. On December 12, 1988, there were 132 seats for dining patrons within the roofed area. Other seats for dining patrons were located in an uncovered area.

   
   

6. Petitioner filed a Notice to Show Cause subsequent to its inspection of December 12, 1988, against Respondent alleging, in pertinent part, the following:

   
   

   On December 12, 1988, you, EDM OF KEY WEST INC., failed to have accommodations for service of 150 patrons at tables on your licensed premises . . . .

   
   

   The Notice to Show Cause did not cite Respondent for failure to keep adequate records of sales.

   
   

7. On May 22, 1989, an inspection revealed that there was seating for only

   118 dining patrons under the roofed area. On June 5, 1989, Respondent was found to be in compliance with the seating requirement.

   
   

8. Respondent filed a timely request for hearing and therein denied the factual allegations of the charge brought against it.

   CONCLUSIONS OF LAW

   
   

9. The Division of Administrative Hearings has jurisdiction over the subject matter of and the parties to this proceeding. Section 120.57(1), Florida Statutes.

   
   

10. Petitioner must prove the allegations of its Notice to Show Cause by a preponderance of the evidence. Because the license involved is not a "professional license," the clear and convincing evidence standard does not apply. Ferris v. Turlington, 510 So.2d 292 (Fla. 1987)

    
    

11. Special licenses are authorized for restaurants by Section 561.20(2)(a)4, Florida Statutes, which describes, in pertinent part, the establishments entitled to the special license as follows:

    
    

    4. Any restaurant having 2,500 square feet of service area and equipped to serve 150 persons full-course meals at tables at one time, and deriving at least 51 percent of its gross revenue from the sale of food and nonalcoholic beverages

    
    

12. Rule 7A-3.014, Florida Administrative Code, provides, in pertinent part, as follows:

    
    

    Applications for liquor licenses in excess of the quota limitation set forth in Section 561.20(1), Florida Statutes, under provisions of the law that permit the issuance of special restaurant licenses to restaurants occupying 2,500 or more square feet of space, having accommodations for service of 150 or more patrons at tables, containing all necessary equipment for the service of full course

    meals and serving such meals regularly, may not include in the required footage any space contained in an uncovered or not permanently covered area adjacent to the premises. . . .

    
    

13. Rule 7A-3.015, Florida Administrative Code, provides, in pertinent part, as follows:

    
    

    1. All restaurants holding a special restaurant license must discontinue the sale of alcoholic beverages whenever the service of full course meals is discontinued. . . .

       1. The following criteria will be used in determining whether or not the holder of a specified restaurant license is a bona fide restaurant.

          1. Tables of adequate size to accommodate the service of full course meals in accordance with the number of chairs found at that table.

          2. The restaurant must derive at least 51 percent of its gross revenue from the sale of food and nonalcoholic beverages. The 51 percent

             shall be determined by taking the average monthly gross revenue of the sale of food and nonalcoholic beverages over a 12-month period.

          3. The principal business of the restaurant must cater to and serve full course meals to the general public.

          4. The business is advertised and held out to the public to be a place where meals are served, space being provided with adequate dining room equipment and having employed such number and kinds of employees for serving meals for

             guests, the primary operation of such restaurant shall be for the serving of meals and not for the sale of alcoholic beverages.

          5. The restaurant shall be equipped with the necessary tableware and seating to handle the minimum seating capacity required by general law or by special act.

          6. Seating at bars or counters shall not be counted in the minimum seating requirement except as otherwise provided by special act.

       
       

14. Respondent's proposed construction of Section 561.20(1)(a)4, Florida Statutes, and of Rule 7A-3.014, Florida Administrative Code, that outdoor dining areas may be counted to satisfy the requirement that the restaurant maintain seats for 150 dining patrons, is rejected. Neither the applicable statute nor the applicable rules provide for the inclusion of outdoor seats in the 150 seat count. The regulatory scheme contemplates that the 150 seats for dining patrons be available at all times, including during times of inclement weather. Section 561.20(2)(a)4, Florida Statutes, provides that restaurants entitled to the special license are those restaurants ". . . having 2,500 square feet of service area and equipped to serve 150 persons . . . ." Respondent would not meet this criteria if it did not have the required seating capacity during bad weather.

    
    

15. To the extent that the statute and rules are ambiguous because they do not specifically state whether outdoor seating can be counted against the 150 seat requirement, it is appropriate to consider the agency's interpretation of its regulatory scheme and to give great weight to that interpretation. Department of Environmental Regulation v. Goldring, 477 So.2d 532 (Fla. 1985), Pan Am World Airways v. Florida Public Service Commission, 427 So.2d 716 (Fla. 1983). Petitioner's interpretation of the regulatory scheme is that outdoor seating cannot be counted to satisfy the requirement that there be adequate seating for 150 dining patrons. Respondent was specifically advised as to that interpretation.

    
    

16. Rule 7A-3.014, Florida Administrative Code, requires that the restaurant occupy 2,500 square feet of space under roof and that the restaurant have accommodations for at least 150 patrons at tables. These provisions, read together, are construed to require that the 150 seats be within the roofed area.

    
    

17. Section 561.29(3), Florida Statutes, provides, in pertinent part, as follows:

    
    

    The division may impose a civil penalty against a licensee for any violation mentioned in the Beverage Law, or any rule issued pursuant thereto, not to exceed $1,000 for violations

    arising out of a single transaction. If the licensee fails to pay the civil penalty,

    his license shall be suspended for such period of time as the division may specify. . . .

    
    

18. Respondent failed to have the 150 seats for dining patrons on December 12, 1988, and therefore violated the provisions of Section 561.20(2)(a)4, Florida Statutes, and Rule 7A-3.014, Florida Administrative Code.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be entered finding Respondent guilty of

having failed to have accommodations for the seating of 150 dining patrons as

required by Section 561.20(2)(a)4, Florida Statutes, and by Rule 7A-3.014 and Rule 7A-3.015, Florida Administrative Code, and which imposes an administrative fine of $500.00 against Respondent.

DONE and ENTERED this 21st day of July, 1989, in Tallahassee, Leon County, Florida.

CLAUDE B. ARRINGTON

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550 904/488-9675

Filed with the Clerk of the Division of Administrative Hearings this 21st day of July, 1989.

APPENDIX

The proposed findings of fact submitted on behalf of Petitioner are addressed as follows:

1. Addressed in paragraph 1.

2. Rejected as being unnecessary to the conclusions reached.

3. Addressed in paragraph 2.

4. Addressed in paragraph 3.

5-6. Addressed in paragraphs 4-5. Rejected in part as being unnecessary or subordinate to the findings made.

7-8. Addressed in paragraph 7.

1. Rejected as being unnecessary to the result reached.

2. Addressed in paragraph 3.

11-16. Rejected as being recitation of testimony or subordinate to the findings made.

The proposed findings of fact submitted on behalf of Respondent are addressed as follows:

1. Addressed in paragraph 1.

2. Rejected as being unnecessary to the conclusions reached.

3. Addressed in paragraph 2.

4. Addressed in paragraph 3.

5-6. Addressed in paragraphs 4-5. Rejected in part as being unnecessary or subordinate to the findings made.

7-8. Addressed in paragraph 7.

1. Rejected as being unnecessary to the result reached.

2. Addressed in paragraph 3.

11-16. Rejected as being recitation of testimony or subordinate to the findings made.

COPIES FURNISHED:

Harry Hooper, Esquire Deputy General Counsel 725 South Bronough Street

Tallahassee, Florida 32399-1000

James T. Hendrick, Esquire MORGAN & HENDRICK, P.A.

Post Office Box 1117 Key West, Florida 33041

Leonard Ivey, Director

Department of Business Regulation

Division of Alcoholic Beverages and Tobacco The Johns Building

725 South Bronough Street Tallahassee, Florida 32399-1000

Stephen R. MacNamara, Secretary Department of Business Regulation The Johns Building

725 South Bronough Street Tallahassee, Florida 32399-1000

Joseph A. Sole, General Counsel Department of Business Regulation The Johns Building

725 South Bronough Street Tallahassee, Florida 32399-1000

Docket for Case No: 89-001357

Orders for Case No: 89-001357