STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

I & H ENTERPRISES, INC., d/b/a ) BASIN STREET EAST, )

)

Petitioner, )

)

vs. ) Case No. 85-1947

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

)

Respondent. )

)

RECOMMENDED ORDER

The final hearing in this case was held in Tampa, Florida, on November 5, 1986. At the conclusion of the hearing, the parties requested a stay of all post-hearing procedures for 45 days to give the parties an opportunity to settle the case. The motion was granted, but the parties were unable to settle the case. As a result, Respondent, Department of Business Regulation, Division of Alcholic Beverages and Tobacco (Division), requested that proposed recommended orders be required to be filed on or before February 1, 1986. Petitioner, I & H Enterprises, Inc., d/b/a Basin Street East (Petitioner), did not oppose this deadline but later requested an extension of time until February 10, 1986, in order to file its proposed recommended order. The Division did not object to the extension of time, and it was granted.

APPEARANCES

For Petitioner: Joseph L. Diaz, Esquire

Tampa, Florida

For Respondent: Thomas A. Klein, Esquire

Tallahassee, Florida

The issue in this case is whether the Division should grant Petitioner's application for a quota alcoholic beverage a license. Specifically, the issues are:

1. Whether Petitioner had a right to occupancy of the premises identified in its license application, as required for licensure: and

2. Whether Barbara A. Ingargiola had a direct or indirect interest that would prohibit licensure.

FINDINGS OF FACT

1. Victor Ingargiola is the sole shareholder, director and officer of Petitioner, I & H Enterprises, Inc., d/b/a Basin Street East (Petitioner), a Florida corporation. The State of Florida, Department of Business Regulation, Division of Alcoholic Beverages and Tobacco, is the Respondent.

   
   

2. Both Mr. Victor Ingargiola and his wife, Mrs. Barbara Ingargiola, entered the Division's double random selection drawing for eligibility to apply for a new quota alcoholic beverage license. Mr. Ingargiola was selected in the drawing, and Mrs. Ingargiola was not. After receiving notice of his selection in the drawing, Mr. Ingargiola formed the Petitioner and applied for licensure on or about November 1, 1984.

   
   

3. In his application, Mr. Ingargiola did not identify his wife as a person having an interest in Petitioner or its business, either directly or indirectly. The application also represented that Petitioner had a right to occupancy of the premises to be licensed at 4513 Causeway Boulevard, Tampa, Florida.

   
   

4. Petitioner's application carries with it an application fee of $6,750. Mr. Ingargiola obtained a portion of the funds necessary to pay the application fee from funds held jointly by him and his wife and by loans to him and his wife secured by property jointly held by him and his wife. Virtually all money and property of the Ingargiolas is held in their joint names.

   
   

5. Both Mr. and Mrs. Ingargiola conferred with the Division's Investigator Miller concerning the application. Miller initially requested that Mrs. Ingargiola be finger printed as a person having an interest in the license to be issued. Mrs. Ingargiola understood that she was not permitted to have an interest since she herself had entered the double random selection drawing. She therefore declined to be fingerprinted or to be made to appear on the application as a party having an interest in the license to be issued.

   
   

6. Investigator Miller also discussed with the Ingargiolas the question of Mrs. Ingargiola's involvement and the financing of Petitioner. Investigator Miller led the Ingargiolas to believe that the only possible legal financing arrangement would be for Mrs. Ingargiola to give the funds to her husband outright. He led them to believe that this could be done by

   affidavit, and Mrs. Ingargiola signed and filed an affidavit which Investigator Miller approved as to form. The affidavit listed the financing in question and stated: "I swear that the following funds obtained are to be used by Victor A. Ingargiola and I will have no interest or control over these funds." Barbara Ingargiola also testified at final hearing that she claims no interest whatsoever in Petitioner, any license to be issued to it, or the funds she gave outright to her husband to finance Petitioner.

   
   

7. Essentially, Mrs. Ingargiola gave her half of the joint funds and proceeds of joint loans used by Victor Ingargiola to finance Petitioner's application fee. If necessary, she was prepared to do the same with the proceeds from the sale of joint real property or loans secured by the Ingargiolas' joint real property. However, no mention was made or consideration given to Mrs. Ingargiola's liability for her husband's share of the joint borrowing in addition to hers. Mrs. Ingargiola did have an interest in the successful operation of Petitioner so as to enable her husband to pay at least half, if not all, of the joint borrowing used in part to finance Petitioner.

   
   

8. On or about October 12, 1984, Mr. Ingargiola obtained a written lease to the premises to be licensed. However, the lease does not contain a commencement date. At the time the application was filed, the premises were occupied by another tenant, and, as of December 20, 1984, this tenant had a legal right to occupy the premises and had not been notified of the pending liquor license application or the lease. In addition, the purported lease contains a provision requiring Petitioner to secure its duties and obligations under the lease by depositing with the landlord the sum of $60,000 in cash or irrevocable letter of credit. There was no evidence that Petitioner had complied with or could comply with this requirement of the lease. Although Mr. Ingargiola testified to his understanding of his right to occupancy of the premises under the lease upon granting of Petitioner's application and issuance of the license, there was no testimony from the landlord on the ambiguities surrounding the lease and the rights of the tenant in possession. As a result, the evidence as a whole was insufficient to prove Petitioner's right to occupancy of the premises to be licensed.

   CONCLUSIONS OF LAW

   
   

9. Under Section 561.19(2), Florida Statutes (1985), an alcoholic beverage license shall not be issued unless the applicant establishes that the premises to be licensed qualify under the Beverage Law. In this case, Petitioner's evidence taken as a whole was insufficient to prove that the Petitioner had a legal right to occupy the premises to be licensed either at

   the time of the application, the time of the final hearing, or the time of the issuance of the license.

   
   

10. Under Section 561.19 (2), a person or corporation is only allowed to file one application in the quota license double random selection process. If the applicant or a person who is interested, either directly or indirectly, in the business is not qualified, the application cannot be granted. See Section 561.17(1), Florida Statutes (1985). By having entered the same quota license random selection process which resulted in the selection of her husband, Mrs. Ingargiola disqualified herself from having any interest in Petitioner, either direct or indirect. In this ease, Petitioner was unable to prove that Mrs. Ingargiola had no such interest in Petitioner, as explained in more detail in the Findings of Fact.

RECOMMENDATION

Based on the foregoing Findings Of Fact and Conclusions Of Law, it is recommended that Respondent, Department of Business Regulation, Division of Alcoholic Beverages and Tobacco, deny the application of Petitioner, I & H Enterprises, Inc., d/b/a Basin Street East, for a quota alcoholic beverage license

RECOMMENDED this 17th day of March, 1986, in Tallahassee, Florida.

J. LAWRENCE JOHNSTON Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 17th day of March, 1986.

COPIES FURNISHED:

Joseph L. Diaz, Esquire 2522 W. Kennedy Blvd.

Tampa, FL 33609

Thomas A. Klein, Esquire Department of Business Regulation 725 S. Bronough Street Tallahassee, FL 32301-1927

Howard M. Rasmussen, Director

Division of Alcoholic Beverages and Tobacco Department of Business Regulation

725 S. Bronough Street Tallahassee, FL 32301

Richard B. Burroughs, Jr., Secretary Department of Business Regulation 725 S. Bronough Street

Tallahassee, FL 32301

Docket for Case No: 85-001947

Orders for Case No: 85-001947