STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, ) DIVISION OF ALCOHOLIC BEVERAGES, ) AND TOBACCO, )

)

Petitioner, )

)

vs. ) CASE NO. 93-1393

)

DENNIS L. MAXWELL )

d/b/a Club 21, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the above-styled matter was heard before the Division of Administrative Hearings by its duly designated Hearing Officer, Daniel M. Kilbride, on July 1, 1993, in Orlando, Florida. The following appearances were entered:

APPEARANCES

For Petitioner: John F. Gilroy, Esquire

Assistant General Counsel Department of Business and

Professional Regulation Northwood Center

1940 North Monroe

Tallahassee, Florida 32399-1007

For Respondent: Dennis L. Maxwell, pro se

Post Office Box 53 Eustis, Florida

STATEMENT OF THE ISSUES

Whether Respondent, or his agent or employee, possessed, or permitted someone to possess, at or in the licensed premises, alcoholic beverages not authorized by law to be sold by Respondent.

Whether Respondent, or his agent or employee, allowed patrons to gamble at card games, contrary to Section 849.01, Florida Statutes.

Whether Respondent, his agent or employee allowed patrons to possess and consume marijuana and crack cocaine on the licensed premises.

PRELIMINARY STATEMENT

On January 28, 1993, Petitioner issued a Notice to Show Cause directed to Respondent. Following an informal hearing, Respondent disputed issues of material fact and demanded a formal hearing. This matter was referred to the Division of Administrative Hearings on March 9, 1993, and this hearing followed.

The Petitioner presented the testimony of four witnesses, as follows: Special Agent Rick Hurlburt, DABT; Special Agent Frank Glover, DABT; former Officer Victor Smith, Eatonville Police Department; and Officer Chris Mullin, Leesburg Police Department. Petitioner offered one exhibit, which was received in evidence. Respondent offered the testimony of Mr. Karl Welcome, employee of Respondent, as well as his own testimony. Respondent offered no exhibits. A transcript was not prepared. Petitioner filed its proposed findings of fact and conclusions of law on July 12, 1993. Respondent has not filed proposed findings, as of the date of this order. My specific findings on Petitioner's proposals appear in the Appendix attached hereto.

Based upon all of the evidence, the following findings of fact are determined:

FINDINGS OF FACT

1. Respondent Dennis Maxwell holds DABT License number 45-00933, and owns and operates the Club 21 in Leesburg, Florida.

   
   

2. License number 45-00933 is a series 2-COP license, authorizing the sale and consumption of beer and wine only on the premises.

   
   

3. Mr. Maxwell has been in business as the Club 21 at 945 East Main Street in Leesburg, Florida, since approximately February 1992.

   
   

4. Club 21 is frequented by a predominantly young (early 20's), black clientele, not unlike a number of other bars in Leesburg. Club 21, however, has been unique in the severity of problems experienced by the Leesburg Police in attempting to maintain peace and lawfulness.

   
   

5. Upon information that the service of alcoholic beverages to minors has been occurring, agents of DABT, with assistance from local law enforcement, entered Club 21 in an undercover capacity at approximately 10:00 p.m. on Friday, January 15, 1993. They discovered open and obvious violations of both the beverage law and Florida criminal law, specifically gambling (card game for money), and unauthorized liquor being stored and consumed on the premises.

   
   

6. On January 15, 1993, at 10:00 p.m., a high stakes card game was in progress in a somewhat separate area of the premises just to the left of the entrance. At a table with a group of men playing cards, was a pile of currency, with a large "pot" of money in the middle of the table. The pot was collected by the winner of each hand. Additionally, other persons standing around the seated players were placing separate wagers in connection with the ongoing game.

   
   

7. The game was occurring in plain view of the patrons in the bar, and anyone entering or exiting the premises. The card game continued for approximately 20-30 minutes prior to uniformed law enforcement officers entering the premises.

8. The Respondent was present at Club 21 during that entire night, and admitted to having permitted the card games to occur, but denied that gambling was occurring. Mr. Maxwell, likewise, admitted that he would recognize the commonly understood circumstances of a card game for money by the money set out in front of each card player, and the "pot" of money in the middle of the table. Although he observed the same game occurring as testified to by other witnesses, he does not recall seeing the money on the table. Respondent further testified that the area of the bar known as the "game room" was often used for card games, but that he had never been aware of gambling occurring in connection with such games. Respondent's testimony is not credible in light of the circumstances.

   
   

9. The licensee did permit persons to play for money at a card game on his premises.

   
   

10. During the course of the DABT operation on January 15, 1993, several bottles of unauthorized liquor was observed in plain view in the kitchen of Club

1. The liquor consisted of one unsealed 1.75 liter bottle of Seagram's Dry Gin, one unsealed .750 liter bottle of Seagram's dry Gin, and one unsealed pint bottle of Canadian Mist Whiskey. Petitioner was aware that the liquor described was in fact in the kitchen.

   
   

   1. As to the larger bottle of gin, Mr. Maxwell contended that it belonged to one of his employees, Karl Welcome, who was celebrating his birthday that night, and had stopped by the premises to engage in a celebratory toast with his friends and coworkers. Mr. Welcome testified to that effect on direct examination, but admitted on cross that his birthday is actually May 18, not January 15, and that he had made up that story originally for the benefit of the officer who had found the liquor. As to the remaining bottles of liquor, Respondent claimed that he had confiscated them from patrons earlier that afternoon, and placed them in the kitchen because he was too busy to dump them out. In light of Mr. Maxwell's further testimony that there is hardly any business at Club 21 in the afternoon, and he does not have much to do until nighttime, his contention is not credible.

      
      

   2. Petitioner knew that the liquor was in the kitchen, and took no meaningful action to correct that situation.

      
      

   3. During the course of their stay in an undercover capacity inside Club 21, two witnesses observed what they believed was marijuana being openly smoked by patrons in the area of the bar itself on the premises. One witness described two patrons openly sharing what appeared to be a marijuana joint while actually seated at the bar. The "joint" was passed back and forth openly and in plain view of two bartenders who were standing directly in front of these patrons, and who actually brought beer to, and took money from, these patrons while they were openly smoking a joint.

      
      

   4. Two witnesses smelled an odor which is commonly associated with the smell of marijuana burning in the area of the bar during the entire time they were there. From the smell, they testified that in their opinion it was obvious that other patrons besides those seated directly at the bar were smoking as well.

      
      

   5. Officers of the Leesburg Police Department arrested a patron of Club

      21 on the premises for possession of cocaine on the evening of January 15, 1993. Officer Mullin field tested the substance and testified that both his field test and the laboratory analysis conducted on it confirmed that it was cocaine. The possession charges are the subject of an ongoing criminal case.

   6. Respondent had been visited by a DABT Special Agent during the fall of 1992 on a routine call. At that time, unauthorized liquor was found of the same variety as was found in January 1993. A record of the discovery was made but a notice of violation was not issued. Rather, the seriousness of unauthorized liquor on the premises was discussed and Mr. Maxwell had been warned not only about that particular violation, but about the dangers of drug use on the premises, and related problems. Mr. Maxwell recalled the visit and the warning, and testified that Agent Hurlburt had been honest and forthright with him, and had emphasized the risk of an enforcement action against a licensee for allowing violations of law to occur on a licensed premises.

      
      

      CONCLUSIONS OF LAW

      
      

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

      
      

   8. Section 561.29, Florida Statutes, provides in pertinent part:

      
      

      1. The division is given full power and authority to revoke or suspend the license of any person holding a license under the Beverage Law, when it is determined or found by the division upon sufficient cause appearing of:

         1. Violation by the licensee or his or its agents, officers, servants, or employees, on the licensed premises, or elsewhere while in the scope of employment, of any of the laws of this state or of the United States . . . or permitting another on the licensed premises to violate any of the laws of this state or of the United States; except that whether or not the licensee or his or its agents . . .have been convicted in any criminal court any violation as set forth in this paragraph shall not be considered in

            proceedings before the division for suspension or revocation of a licenses except as permitted by chapter 92 or the rules of evidence.

            * * *

            (3) 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. The funds so collected as civil penalties shall be deposited in the state General Revenue Fund.

   9. Section 562.02, Florida Statutes provides:

      
      

      562.02 Possession of beverage not permitted to be sold under license.---It is unlawful for a licensee under the Beverage Law or his agent to have in his possession, or permit anyone else to have in his possession, at or in the place of business of such licensee, alcoholic beverages not authorized by law to be sold by such licensee.

      
      

   10. Section 849.01, Florida Statutes provides:

       
       

       849.01 Keeping gambling houses, etc.--Whoever by himself, his servant, clerk or agent, or in any other manner has, keeps, exercises or

       maintains a gaming house, booth, tent, shelter or other place for the purpose of gaming or gambling or in any place of which he may directly or indirectly have charge, control

       or management, either exclusively or with others, procures, suffers or permits any person to play for money or other valuable thing at any game whatever, whether heretofore prohibited or not, shall be guilty of a felony of the third degree . . . .

       
       

   11. The licensee may be guilty of violating the beverage law and of operating a nuisance if he is guilty of intentional wrongdoing or if he fails to exercise due diligence in supervising and maintaining surveillance over the licensed premises. Jones v. State, Department of Business Regulation, 448 So. 2d 1109, 1111 (Fla. 1st DCA 1984). While sanctions may be imposed for a single violation by a corporate officer, the agency must still prove lack of due diligence by the officer. Surf Attractions v. Department of Business Regulation 480 So. 2d 1354, 1356 (Fla. 1st DCA 1985).

       
       

   12. In Jones, supra, there was no evidence to show that the licensee had knowledge of the illegal activity on the premises. In Surf Attractions, supra, the licensee's officer approved the sale based on the purchaser's use of a Missouri traffic ticket and a photo identification card from a community center. In both cases, the courts overturned the agency's imposition of a penalty.

       
       

   13. There is no evidence of prior violations and no rules or guidelines regarding appropriate penalties. A range of penalties is available in Sections 561.29(1) and (3), Florida Statutes.

       
       

   14. Petitioner was present at the premises during the entire evening of January 15, 1993, and either directly observed, or was in a such position as to have easily detected the various acts of illegal activity occurring. Respondent admitted to having allowed card games to transpire on a regular basis, but seeks to avoid responsibility for allowing his bar to be used for gambling, on the basis that he never saw gambling occurring. As open and flagrant as the gambling was, Respondent's disclaimer can only be a result of his choice to ignore the obvious. The only rational conclusions to be reached are either that Respondent had not been truthful, or that he has not made the slightest attempt to be aware of the activities occurring on a regular basis in his establishment. Respondent was specifically and directly aware of the gambling and the liquor in

       the kitchen. Respondent is charged with permitting such violations of Chapters 849 and 893, Florida Statutes, to occur, and in fact he did. The violations discovered during the DABT operation are substantially aggravated by testimony that card games do occur in the game room on a regular basis. Likewise, the discovery of unauthorized liquor on the premises followed a specific warning about the very same violation. No enforcement action was taken on the earlier occasion upon the representations of Respondent that he understood the seriousness of the issue, and would take action to prevent future problems.

       
       

   15. Respondent has exhibited a rank disregard for his responsibility as a licensee to exercise due diligence to prevent violations of the law from occurring on his premises. Jones v. State, Department of Business Regulation, supra.

       
       

   16. The specific charge against the licensee of permitting marijuana use on the premises in this case is based on a single incident. The testimony offered to prove this allegation tended to show that marijuana was being smoked in Club 21 by patrons. However, the proof was insufficient to establish that it was in fact marijuana. The Department failed to prove the charge. Therefore, Respondent cannot be held accountable for his inaction in permitting patrons to possess and consume marijuana on the premises.

       
       

   17. The evidence was also insufficient to prove that the Respondent had knowledge of the violation of the drug laws (possession of cocaine) on the premises and for failure to exercise due diligence to prevent such violations.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Respondent's license number 45-0093 be suspended for a

period of twenty (20) days, and that Respondent pay a civil penalty in the amount of $1,000.00.

DONE AND ENTERED this 22nd day of July, 1993, in Tallahassee, Leon County, Florida.

DANIEL M. KILBRIDE

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 22nd day of July, 1993.

APPENDIX

The following constitutes my specific rulings, in accordance with section 120.59, Florida Statutes, on findings of fact submitted by the parties.

Petitioner's proposed findings of fact.

Accepted in substance: paragraphs 1, 2, 3, 6, 7, 8, 9, 10(in part), 13, 14 Rejected as immaterial, irrelevant or subsumed or argument: paragraphs 4,

5, 10(in part), 12(in part)

Rejected as against the greater weight of evidence: paragraphs 12(in part)

COPIES FURNISHED:

John F. Gilroy, Esquire Assistant General Counsel Department of Business and

Professional Regulation Northwood Center

1940 North Monroe Street Tallahassee, Florida 32399-1007

Dennis L. Maxwell Post Office Box 53 Eustis, Florida 32727

John Harris Acting Director

Division of Alcoholic Beverages and Tobacco

Northwood Center

1940 No. Monroe Street Tallahassee, Florida 32399-0792

Jack McRay General Counsel

Department of Business and Professional Regulation

Northwood Center

1940 North Monroe Street Tallahassee, Florida 32399-0792

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to the Recommended Order. All agencies allow each party at least 10 days in which to submit written exceptions. Some agencies allow a larger period within which to submit written exceptions. You should consult with the agency that will issue the Final Order in this case concerning their rules on the deadline for filing exceptions to this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the Final Order in this case.

Docket for Case No: 93-001393

Orders for Case No: 93-001393