STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
DEPARTMENT OF BUSINESS ) REGULATION DIVISION OF ALCOHOLIC ) BEVERAGES AND TOBACCO, )
)
Petitioner, )
)
vs. ) CASE NO. 88-0681
) PATRICIA FREEZE AND FREDERICK ) KOCH d/b/a CORRAL BAR, )
)
Respondent. )
)
RECOMMENDED ORDER
This matter came on for hearing in Ocala, Florida, before the Division of Administrative Hearings by its duly designated Hearing Officer, Diane Cleavinger, on May 2, 3 and 4, 1988. The parties were represented as follows:
FOR PETITIONER: Harry Hooper, Esquire
Deputy General Counsel
Department of Business Regulation The Johns Building
725 South Bronough Street Tallahassee, Florida 32399-1000
FOR RESPONDENT: C. John Coniglio, Esquire (for Patricia Freeze) Post Office Box 1119
Wildwood, Florida 32785 Frederick Koch did not appear.
The issue addressed at this proceeding is whether Respondents' alcoholic beverage license should be suspended, revoked or otherwise disciplined for multiple violations of the Florida controlled substances law and for maintaining a nuisance on the licensed premises.
Petitioner called three (3) witnesses and introduced twenty-three (23) exhibits. Respondent Freeze testified in her own behalf and called five (5) witnesses and introduced one exhibit. Neither Petitioner nor Respondents filed proposed findings of fact or conclusions of law.
FINDINGS OF FACT
Respondent, Patricia Freeze, is the operator of The Corral Bar located in Wildwood, Florida. She operates that bar under liquor license number 70- 00087, which reflects both herself and Respondent, William Koch, as the owners of the said license. Ms. Freeze is the licensee primarily responsible for operating the bar. Mr. Koch does not materially manage the premises. Both Ms.
Freeze and Mr. Koch have been in business for ten (10) years during which the bar has been Ms. Freeze's primary means of support.
Ms. Freeze's problems began when the Fifth Judicial Circuit Task Force, operating out of Ocala, Florida, decided to run an undercover operation out of The Corral Bar. The location of the undercover operation was chosen because the Sumter County Sheriff's Department had indicated that the bar was the location of a considerable amount of drug activity. However, a local Wildwood police officer testified that the bar did not have the reputation for frequent drug activity as had been indicated by the Sheriff's Department.
In any event, beginning in early November of 1986, Officers Monty Griffin and Noel Griffin (brothers) entered the bar in an undercover capacity. They wished to become well known as patrons of the bar in order to make contact with potential drug dealers. The ploy was evidently successful. The officers made contact with at least three (3) other patrons of the bar who were interested in selling drugs to the officers. The illegal drug sales took place over a period running from mid November through late December, 1986, and specifically took place on November 14, November 28, December 1, December 3, December 5, and December 8, 1986.
The November 14, 1986, transaction occurred on the porch of the bar. The porch area is a recent addition and a person inside the bar has no view onto the porch except through the doorway. Monty and Noel Griffin were in the bar seated at a table. Monty Griffin saw Terry Lea and another individual on the porch of the bar and went outside to join him in an attempt to make a drug deal. Noel Griffin remained in the bar and could not see Griffin and Lea. Lea asked Monty Griffin if he wanted a hit off the joint he was smoking on the porch. As the officer simulated smoking the marijuana they walked off to the side of the porch and negotiated a drug deal for cocaine. Lea left to go get the cocaine. He returned later and delivered the gram of cocaine to the officers. Neither officer recalled seeing either Patricia Freeze or William Koch on the licensed premises during the November 14 transaction.
The November 28 transaction occurred when the two officers made contact with John Hughes and Dennis Stone inside the bar. Stone said that he was going to purchase some marijuana. The officers asked him to get an extra bag and gave him $30.00 for the extra bag. Stone left the bar and came back later. The officers met him in the parking lot and picked out the bag they wanted. Neither officer remembered either Respondent being present on the licensed premises during the November 28 transaction.
The December 1 transaction began around 5:30 p.m. when Lea was ostensibly "tending bar". 1/ There were a couple of other customers in the bar. Neither officer had ever seen Lea tend bar before. Lea invited the officers out back to smoke some marijuana he had. The group was outside for 5 or 10 minutes during which the marijuana was smoked with the officers simulating the act. The officers wanted to purchase some marijuana. Lea directed them to Yogie's (Herbert Blackburn) house. The officers left to find the house, but were unable to do so. When the officers returned to the bar they saw Yogie sitting on the porch of the bar. The officers asked to purchase some marijuana. Yogie consented and the group stepped over to Yogie's vehicle which was parked 8 to 10 feet away at the open end of the porch facing the parking lot. Yogie pulled out a paper bag which had several baggies inside. The officers selected one of the baggies and paid for their purchase. The group then reentered the porch area of the bar and joined several other people there. The officers
simulated the act of smoking marijuana with the larger group. Again, neither officer recalls either Respondent being present on the licensed premises.
The December 3 transaction occurred when the officers met Lea in the bar in order to purchase a bag of marijuana. Lea and the officers exited the bar to the porch and Lea produced a bag containing a small amount of marijuana for which the officers paid. The officers did not recall any other people being present on the porch. Nor did they recall either owner being present.
The December 5 transaction began at 1:00 p.m. when Lea unsuccessfully attempted to purchase some marijuana for the officers. Lea gave the officers their money back. At about 5:30 p.m. the officers gave the money back to Lea in order to attempt another purchase. Lea left the bar. About an hour later, Lea returned with three bags of marijuana. He met the officers on the porch and gave one bag to the officers. Lea demanded a marijuana bud as payment. The officers complied. Lea then proceeded to divide the other two bags into smaller quantities by using a set of finger scales to weigh the contraband. Apparently, other people on the porch had purchased some marijuana as well. Neither officer saw either owner on the licensed premises.
The December 8 transaction occurred in the evening when Ms. Freeze was tending bar about 10 or 15 feet away with several other patrons between her and the officers. The officers were seated at a table along with Lea and some other people. The officers negotiated the purchase of some marijuana inside the bar. However, the actual exchange of money and drugs took place outside the bar on the porch. After the exchange the officers went back inside the bar to the table they had occupied earlier. A short time later a minor named Joseph entered the bar, walked up to Lea and whispered in his ear. Joseph then opened his hand over the table and the officers saw two marijuana buds. The officers then went back onto the porch and bought the buds from Joseph. No credible evidence was presented that either transaction was observed or overheard by either Respondent or any other patron in the bar.
The officers were acting in an undercover capacity on December 16 along with another female officer. However the female officer was recognized by a patron of the bar. The officers felt their cover had been blown and the undercover operation was concluded. The bar was raided and arrests were made of several of the bar's patrons on December 20. Petitioner's agents accompanied law enforcement officers to the December 20 raid. Investigator Bays was one of the beverage agents. He talked to Pat Freeze and conducted an inspection of her premises. No violations were found. While Investigator Bays spoke with Ms. Freeze, she stated to him that she had "told those people and told those people about smoking that shit in here." Ms. Freeze was very upset and crying. However, Freeze testified that she had on occasion overheard a patron ask for a joint. She would then tell the patron to take it somewhere else. The statement taken together with Ms. Freeze's testimony renders its use as evidence of knowledge on the part of Ms. Freeze inconclusive at best.
As can be seen, from the above rendition of the drug deals which occurred on the bar's premises, the general method of operation for the sales was to discuss the deal in the bar and then complete the transaction outside of the bar, generally in the parking lot or on the porch. What is especially important is that the conversations during and surrounding the drug negotiations inside the bar were never overheard and probably could not have been overheard by anyone in the bar since the music was loud enough to drown out any conversation. No evidence was presented that any employee of Respondent was ever in a position to either see, overhear or participate in the drug
transactions. 2/ The drug negotiations inside the bar were therefore secret and not out in the open and were not capable of being discovered with the exercise of any diligence on Respondent's part.
The only incident which may be viewed as being overt occurred when the juvenile entered the bar and pulled out two buds of marijuana. However, the testimony regarding that event clearly showed that the bud was probably not in anyone's view except for the people sitting at the table since any normal view was blocked by the people surrounding the table and the patrons sitting at the bar. More importantly, there was no indication that anyone else in the bar other than the people at the table had seen the buds. Therefore, no reasonable inference can be drawn from the event itself which would indicate that Respondent had any direct knowledge of the drug transaction or could have by exercising due diligence become aware of the drug transaction.
Petitioner presented no evidence from which a reasonable person could conclude that Respondent had any direct knowledge of the drug dealings going on in her bar. Therefore, the sole question for consideration is whether Respondent failed to exercise due diligence in policing the patrons of her bar regarding their activities while in her bar.
In that regard, Petitioner presented evidence which showed that the patrons of the bar routinely would smoke marijuana cigarettes while sitting on the front porch of the bar. The porch is designed similar to a breezeway and there was no testimony regarding whether the marijuana smell carried inside the bar itself. However, drinks were occasionally served on the porch. Although, Respondent denies that the porch was an appropriate area for beverage services to be given, respondent herself did not serve any drinks on the porch and would remain inside the bar while she was on the premises. However, at least on one occasion she entered the premises behind the undercover officers who noticed a strong odor of marijuana present on the porch. At that point, she said nothing to anyone who was sitting on the porch. However, the evidence was that by the time she entered the porch area, there was no overt evidence of drugs present except for the strong odor of marijuana. The evidence did not show that Respondent would recognize the smell of marijuana.
The lounge catered to a working class clientele of differing ages from Wildwood. Most either knew each other or knew the person's parents. They were not wealthy. The music and atmosphere in the lounge were geared to this type of patron and was played loud. These are not the kinds of patrons the licensee should typically expect to be involved in drugs!
The testimony clearly reflected the marijuana smoking on the front porch by some of the patrons of the bar was very regular and routine. The reason some of the patrons had gotten into the habit of smoking their marijuana on the front porch was because they could see people coming who they knew would disapprove of their conduct such as the local police. The Wildwood officer who testified had indicated that on a couple of occasions, he himself had smelled the odor of marijuana in the parking area or around the building when he would do his biweekly walk through of Respondent's premises. However, he testified that he never saw any overt evidence of who possessed the marijuana or where the odor had come from and had never noticed the odor on a regular basis.
Ms. Freeze testified that on the few occasions that she had overheard someone discussing marijuana in her bar, she told them to take it elsewhere and did not herself permit such conduct in her bar. She did not, however, escort these patrons out. Additionally, she had asked the local Wildwood Police to do
routine walk throughs of the premises in order to keep illegal activity, predominantly fighting, under control. The Wildwood Police Department complied with this request and performed the walk throughs at least twice a week.
Prior to the undercover activity, Petitioner had not received any formal complaints about the bar being a haven for drug activity. Consequently, the drug bust was the first time Ms. Freeze was apprised there was a problem with drugs at her establishment. Since the drug bust in December, Ms. Freeze attempted to begin the practice of escorting patrons out of her bar and received a broken face for which she had to have surgery two times to rebuild her face. She now has signs posted and has made a general effort to watch out more for drug activity. She even requested and allowed a female undercover agent to be placed in her bar.
From the evidence presented, Petitioner did not show that Respondent failed to exercise due diligence in policing her establishment. A key factual element would have been Ms. Freeze's past experience or knowledge about marijuana and drug transactions. No clear and convincing evidence was presented on this point. Further, the evidence did not clearly and convincingly establish that the patrons' drug use was so open and flagrant as to place a reasonable person on notice of a drug problem. The local police who patrolled the establishment did not catch anyone and did not notice a regular pattern of activity. It is one thing for experienced police officers to recognize and observe drug activity. It is another thing for an inexperienced person to recognize and observe such activity. The difference is especially apparent when the officers are fostering the activity and are immersed in their operation and the lay person is not and does not expect to see such activity and has no notice through changing surroundings of a drug problem. Finally, no evidence was presented which demonstrated Respondent maintained a public nuisance.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties and subject matter of this action.
The Division of Alcoholic Beverages and Tobacco is empowered under Florida Statute 561.29 (1981) to discipline a beverage license when the licensee is found to have committed one or more violations enumerated in that section.
In the instant case, the Notice to Show Cause charges the Respondent with the following violations:
A violation of Florida Statutes 561.29(1)(a) and 893.13(2)(a)(5) by maintaining the licensed premises as a place resorted to by persons using controlled substances; and
A violation of Florida Statutes 561.29(1)(c), 823.01 and 823.10 by maintaining a public nuisance on the licensed premises. Each of these charges arises out of the sale of marijuana and cocaine by various patrons of the licensed premises to an undercover officer on November 14 and 28, December 1, 3, 5 and 8, 1986.
Section 561.29(1)(a), Florida Statutes, (1981), empowers the Division of Alcoholic Beverages and Tobacco to revoke or suspend an alcoholic beverage license if it finds that the licensee or his agents, servants, or employees are permitting another on the licensed premises to violate any of the laws of this state or the United States. Section 561.01(11) defines the "licensed premises"
to include the building area where alcoholic beverages are served, areas of access to beverage service areas and the area embraced within the sketch of the premises attached to the license application. Based upon the evidence, the licensed premises in the instant case is limited to the bar itself, as well as the porch area adjacent to the bar. The porch is an area of access to a beverage service area.
Marijuana and cocaine are controlled substances and it is a violation of state law to sell, use, deliver, or possess either substance. Section 893.13, Florida Statutes (1981)
Negotiating a sale of a controlled substance or acting as a go between in arranging such a drug transaction is a violation of Florida law and will subject a person committing such acts to a conviction under the criminal laws of Florida. Nadjawski v. State, 371 So.2d 554 (Fla. 2d DCA 1979), State v. Hubbard, 328 So.2d 465 (Fla. 2d DCA 1976), State v. Dent, 322 So.2d 543 (Fla. 1975). Florida Statutes, Section 776.001.
Florida Statutes, Section 893.13(2)(a)(5) makes it unlawful for any person:
To keep or maintain any store, shop, warehouse, dwelling, building, vehicle, boat, aircraft, or other structure or place which is resorted to by persons using controlled substances in violation of this chapter for the purpose of using these substances, or which is used for keeping or selling them in violation of this chapter.
A violation of this section also constitutes a violation of the Beverage Law through Section 561.29(1)(a) and/or 561.29(1)(c) Florida Statutes.
Similarly, a licensee may also be disciplined by the Division if the licensee is found guilty of "maintaining a nuisance on the licensed premises." Section 561.29(1)(c) Florida Statutes (1981). Section 823.10 of the Florida Statutes, declares a place or building where controlled substances are illegally kept, sold, or used to be a public nuisance and that maintaining such a nuisance is a violation of the laws of the State of Florida.
Licensees are not insurers against unlawful acts by their patrons. Woodbury v. State Beverage Department, 219 So.2d 47 (Fla. 1st DCA 1969). In order to discipline Respondents' license, the Division of Alcoholic Beverages and Tobacco must prove the Respondents were culpably responsible for the violations alleged; that they were guilty either of intentional wrongdoing, or of condoning wrongdoing or failing to exercise due diligence in supervising and maintaining surveillance over the licensed premises. See, e.g., Bach v. Florida State Board of Denistry, 378 So.2d 34 (Fla. 1st DCA 1980); Pauline v. Lee, 147 So.2d 359 (Fla. 2d DCA 1962); Golden Dolphin II v. State of Florida, Division of Alcoholic Beverages and Tobacco, 403 So.2d 1372 (Fla. 5th DCA 1981); G. & B. of Jacksonville, Inc. v. State, 371 So.2d 137 (Fla. 1st DCA 1979).
In the instant case, the evidence clearly establishes that three patrons of the licensed premises sold marijuana and cocaine, both controlled substances, to undercover officers on the earlier described occasions. Each of
the sales occurred on the licensed premises. However, the licensees were not culpably responsible for the illegal drug sales.
There was no evidence that the licensees were involved in or knowingly condoned the drug activity. Therefore, culpability, if it exists, must have been the result of negligence or the failure to exercise due diligence. The evidence also failed to establish such negligence.
The transactions which took place were limited to three patrons. Each sale was made in a secretive surreptitious manner. Negotiations could not be overheard. Ms. Freeze was not able to observe whether a sale had taken place or not since the transactions were either hidden from her view or it was not established whether she was present.
Additionally, the licensees requested a police officer to walk through the licensed premises in order to monitor and supervise the patron's activities on those premises. This was certainly an appropriate step to take when management is not even aware that a drug problem exists.
The lounge catered to a working class clientele of differing ages from Wildwood. Most either knew each other or knew the person's parents. They were not wealthy. The music and atmosphere in the lounge were geared to this type of patron and was played loud. These are not the kinds of patrons the licensee should typically expect to be involved in drugs, especially where her experience with drugs is limited and she made her viewpoint known in few occasions she overheard a patron talking about drugs. The licensed premises has a reputation for fights. However, the reputation for drugs was unclear since not even the police agencies could agree on the bar's character. No drug complaint had been made to Petitioner and Respondent was never given any notice that there was a drug problem on the premises.
Under the circumstances and evidence presented, it is concluded that the licensee took reasonable steps to supervise the licensed premises and is therefore not culpably responsible for the illegal drug sales by the bar patrons. The evidence also established that the licensed premises were not maintained as a nuisance.
Based upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED
That the Respondents be found NOT GUILTY of the violations charged in the Notice to Show Cause and that the charges be dismissed.
DONE and ENTERED this 8th day of August, 1988, in Tallahassee, Florida.
DIANE CLEAVINGER
Hearing Officer
Division of Administrative Hearings The Oakland Building
2009 Apalachee Parkway
Tallahassee, Florida 32399-1550
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 8th day of August, 1988.
ENDNOTES
1/ From the evidence presented, Lea's "bar tending" was not in the nature of an employment relationship, but only a patron helping out the owner of the bar, although he was not authorized to do so.
2/ The evidence showed that Ms. Freeze had only one other employee besides herself and Mr. Koch during this period of time. That particular employee was there for only a few weeks of the relevant time period.
COPIES FURNISHED:
Harry Hooper, Esquire Deputy General Counsel
Department Of Business Regulation The Johns Building
725 South Bronough Street Tallahassee, Florida 32399-1000
C. John Coniglio, Esquire Post Office Box 1119 Wildwood, Florida 32785
Leonard Ivey, Director
Department of Business Regulation Division of Alcoholic Beverages
and Tobacco
The Johns Building
725 South Bronough Street Tallahassee, Florida 32399-1000
Van B. Poole, Secretary Department of Business Regulation The Johns Building
725 South Bronough Street Tallahassee, Florida 32399-1000
=================================================================
AGENCY FINAL ORDER
=================================================================
STATE OF FLORIDA DEPARTMENT OF BUSINESS REGULATION
DIVISION OF ALCOHOLIC BEVERAGES AND TOBACCO
DEPARTMENT OF BUSINESS REGULATION, DIVISION OF ALCOHOLIC BEVERAGES AND TOBACCO,
Petitioner,
vs. CASE NO.88-0681
PATRICIA FREEZE and FREDERICK KOCH, d/b/a CORRAL BAR,
Respondent.
/
FINAL ORDER
COMES NOW the Director, Division of Alcoholic Beverages and Tobacco, and enters his final Order in the above styled cause pursuant to authority vested by Chapter 120, Florida Statutes.
The Director, Division of Alcoholic Beverages and Tobacco, adopts the preliminary remarks of the Hearing Officer and Findings of Fact 1, 2, 3, 4, 5, 6
(with the exception of Footnote 1), 7, 8, 9, 14 insofar as it states that "the patrons of the bar routinely would smoke marijuana cigarettes while sitting on the front porch of the bar" and "at least on one occasion she (Freeze) entered the premises behind the undercover officers who noticed a strong odor of marijuana present on the porch", and 16 to the extent that it states "the testimony clearly reflected that marijuana smoking on the front porch by some of the patrons of the bar was very regular and routine." The reason some of the patrons had gotten into the habit of smoking marijuana on the front porch was because they could see people coming who they knew would disapprove of their conduct such as the local police. The Wildwood officer who testified had indicated that on a couple of occasions, he himself had smelled the odor of marijuana in the parking area or around the building when he would do his bi- weekly walk through of Respondent's premises". The Director, Division of Alcoholic Beverages and Tobacco adopts Conclusions of Law 1, 2, 3, 4, 5, 6, 7, 8 and 10 except the sentence saying "However, the licensees were not culpably responsible for the illegal drug sales", in toto. The remaining Findings of Fact, Conclusions of Law and the Recommendation are rejected pursuant to Section 120.57(1)(b)10, Florida Statutes, because there is no competent, substantial evidence from which those facts could be reasonably inferred and the facts having been modified, different Conclusions of Law and Recommendations must follow. Additional and substituted Findings of Facts and Conclusions of Law are set forth herein. These additional and substituted Findings of Fact and
Conclusions of Law are made after a thorough review of the entire record including a verbatim transcript of the hearing.
ADDITIONAL FINDINGS OF FACT
On November 14, 1986, undercover investigator Monte Griffin sat on the porch of the Corral Bar simulating the act of smoking marijuana with Terry Lea (R-19).
Subsequently, Investigator Monte Griffin, while on the porch negotiated a deal with Terry Lea to purchase one gram of cocaine for $85.00. The $85.00 was delivered to Terry Lea in the parking lot of the Corral Bar next to the porch, and shortly thereafter one gram of cocaine was delivered to Monte Griffin in the same location (R-23, 24).
On November 28, 1986, Investigators Noel and Monte Griffin purchased marijuana in the Corral Bar (R-26,27).
On December 1, 1986, Investigators Noel and Monte Griffin entered the bar and observed Terry Lea tending bar. Terry Lea was standing behind the bar, taking money he served beers, working the cash register, and serving additional customers. Terry Lea produced a marijuana cigarette and invited the investigators to go out of the back part of the bar and smoke a marijuana cigarette with him. The investigators accepted the invitation and simulated smoking a marijuana cigarette supplied by Lea. (R-29, 30).
Terry provided the officers with the name of a person who could provide them with marijuana (R-30, 31). Pursuant to this information the investigators purchased marijuana in the parking lot of the Corral Bar from one Herbert Blackburn (R-32, 33).
On that same day the investigators, on the porch of the bar, simulated smoking a marijuana cigarette with Blackburn (R-33).
On December 3, 1986, the investigators purchased a bag of marijuana from Terry Lea on the porch of the bar (R-36).
On December 5, 1986, Monty Griffin again purchased a bag of marijuana from Terry Lea inside the bar (R-39).
On that same date Terry Lea, while inside the bar, openly weighed marijuana in the bar on finger scales (R-40).
On December 8, 1986, the officers again purchased marijuana from Terry Lea inside the bar (R-42).
On the same day a juvenile by the name of Joseph Register entered the bar and exhibited two buds of marijuana and offered them for sale (R-42, 43).
Subsequently, the officers purchased two buds of marijuana from Register in exchange for $10.00 within the bar (R-43).
Register held those buds of marijuana in the air and in full view of everyone in the bar (R-44).
Unlike previously described transactions, Patricia Freeze was in a position at this time where she would have been able to observe the marijuana being displayed by Registered (R-45).
Noel Griffin stated that he had worked undercover in several dozen bars and that the Corral Bar was unusual because of the freedom with which drugs were bought and sold in and around the bar (R-45, 46).
During the course of the investigation the officers saw other people on different occasions smoking marijuana in the bar (R-47).
People in the bar told the officers that the bar was "cool" which means that it's permissible to be in the bar smoking marijuana (R-47).
People sat out on the porch of the bar and used marijuana regularly and freely (R-48).
A bar being "cool" refers to the person running the bar, that is, the owner not objecting to the sale and use of drugs (R-48).
The officers stated there was no fear of ever having the proprietor "walk out and run us off or tell us to put the dope out or don't smoke" (R-48)
Terry Lea was a part-time bartender and bouncer (R-51).
Officer Noel Griffin stated "there was no paranoia either from patrons in the bar, people behind the bar or the police about openly smoking marijuana. There was no attempt ever made to conceal that type of activity." (R-74).
Wildwood Police Chief and Chief Deputy Sheriff Greg Matthews told Officer Noel Griffin that they needed some help in the Corral Bar because there were drugs being openly sold and used there and "they wanted us to target the place." That was the basis for initiating the investigation in the Corral Bar (R-75, 76).
On one occasion when Officer Monte Griffin was on the porch of the Corral Bar, Patricia Freeze came onto the porch and observed patrons smoking marijuana. The patrons had no reaction to her presence because this activity was a common practice. This was on a day in which no case was made (R- 113,114).
On the dates that have been mentioned as to drug sales or drug usage, Patricia Freeze was usually present within the Corral Bar (R-133).
Patricia Freeze was normally in the bar during the evening hours (R- 134).
On December 20, 1986, law enforcement investigator Mike Bays of the Division off Alcoholic Beverages and Tobacco accompanied Sumter County Sheriff officers on a raid of the Corral Bar. Subsequent to the raid, while discussing the use of drugs within the Corral Bar with Patricia Freeze, Patricia Freeze said that she had told people about "smoking that shit in here." This is credible evidence that licensee, Patricia Freeze, was well aware of marijuana activity within her licensed premises (R-190).
On January 7, 1987, Patricia Freeze spoke to Investigator Bays at the Ocala office of the Division of Alcoholic Beverages and Tobacco. Ms. Freeze
complained that the undercover officers, Noel and Monte Griffin, had been smoking marijuana at her place of business and stated that she thought they should have been arrested along with everyone else. This indicates conclusively that Patricia Freeze was aware of marijuana smoking on her licensed premises during all times pertinent (R-191, 192).
Patricia Freeze testified that she had never seen anybody smoking marijuana in her bar during the pertinent times. Her testimony is regarded as self-serving and unworthy of belief (R-210, 211).
Patricia Freeze is present in her bar about 75 percent of the time they are open (R-224). Patricia Freeze believes that she keeps track of what's going on in the Corral Bar at all times (R-226). Terry Lea pleaded no contest to felony charge of selling marijuana and was sentenced to two years unsupervised probation and adjudication was withheld (R-252). Robert Hildebrand was employed as a police officer in the City of Wildwood during the pertinent times (R-311).
Hildebrand often visited the Corral Bar and smelled marijuana smoke though he didn't smell it on a regular basis. When he thought that he smelled marijuana they would start parking other places as opposed to right in front of the bar (R-319).
The foregoing facts coupled with the facts set forth by the hearing Officer and accepted by the Director demonstrate the sort of open and notorious sale, delivery and use of marijuana that would put any licensee on notice that such activities were on-going within the licensed premises. This drug activity was not secretive but was out in the open and capable of being discovered with the exercise of any diligence on the part of Respondent. The porch area of the bar is a part of the licensed premises and was the preferred marijuana smoking area because it allowed patrons to observe approaching law enforcement officers. The Hearing Officer's gratuitous conclusion that the lounge catered to a working class clientele which are not the kind of patrons a licensee should typically expect to be involved in drugs is patently without evidentiary support in the record. It is clear from the record that Ms. Freeze had past experience with marijuana and was familiar with both the appearance of the drug and the smell of marijuana smoke.
ADDITIONAL CONCLUSIONS OF LAW
Before an alcoholic beverage license can be suspended or revoked, the record should contain substantial and competent evidence to support a finding that the licensee was culpably responsible for the violation as a result of his own negligence, intentional wrongdoing or lack of diligence. So where a licensee momentarily left his bar to run an errand and thereafter his bartender sold an alcoholic beverage to a minor, it would be inappropriate to seek to revoke the license of the licensee. Woodbury v. State Beverage Department, 219 So.2d 47 (Fla. 1 DCA 1969).
Where, however, the evidence shows a persistent or recurring activity, the fact finder may infer that the licensee had knowledge. G.R.B. of Jacksonville, Inc. d/b/a/ Out of Sight v. State, 371 So.2d 139 (Fla. 1 DCA 1979), appeal dismissed, 379 So.2d 205 (Fla. 1979) and Golden Dolphin No. 2, Inc., v. State division of alcoholic Beverages and Tobacco, 403 So.2d 1372. In the latter case one of the customers of the Golden Dolphin testified that he had witnessed the type of activity charged occurring on several previous occasions. The court held this was sufficient evidence for a finding that the Golden
Dolphin's corporate officers had knowledge that its employee was performing in an obscene manner as alleged.
If evidence supports the conclusion that the licensee failed to exercise ordinary care in the maintenance of the licensed premises or supervision of his employees, he can be found negligent and his liquor license revoked. Lash, Inc. v. State Department of Business Regulation, 411 So.2d 276 (Fla. 3 DCA 1982).
In the instant case the evidence clearly establishes that three patrons of the licensed premises sold marijuana and cocaine, both controlled substances, to undercover officers on the earlier described occasions. Each of these sales occurred on the licensed premises. With the exception of Terry Lea, none of the sales were made by employees or persons acting as employees of the licensed premises. There was no evidence that the licensees were personally involved in the drug activity. However, a licensee, granted a privilege to sell alcoholic beverages by the State of Florida, must exercise due diligence in his or her responsibility to prevent the sale, delivery and use of controlled substances on the licensed premises. It is specifically concluded that Ms. Freeze could not have been ignorant of the widespread, open and notorious sales that occurred and of the open and notorious use of marijuana within the licensed premises. Steps taken by Ms. Freeze after she learned action would be taken against her license, if she did take steps, to prevent a reoccurrence of the use of the premises for sale, delivery and use of controlled substances, are irrelevant to the events set forth in the Notice to Show Cause. Whether or not the kind of patrons who visited the Corral Bar were the types of persons that could typically be expected to be involved in drugs as a matter of conjecture which cannot not be determined from a study of the record. In any event it is concluded that the licensee knew or should have known of the use of her licensed premises for the sale, delivery and use of controlled substances and that between December 1, 1986 and December 20, 1986, the licensees did in fact keep and maintain a building which was resorted to by persons using, keeping or selling controlled substances in violation of Chapter 893, Florida Statutes, contrary to Section 893.13(2)(a)5, Florida Statutes, and that during the same time the licensees did keep or maintain a public nuisance; a shop, store, or building which was being used for the illegal using and keeping, selling, or delivering substances controlled under Chapter 893, contrary to Sections 823.10 and 561.29(1)(c), Florida Statutes.
ORDER
Based upon the foregoing Findings of Fact and Conclusions of Law, the Respondents are found guilty of the violations charged in the notice to show Cause and the license is revoked. This revocation shall be lifted and the consequent impairment of Respondent's qualifications shall cease upon receipt by the division, within 15 days after service of this Final Order of a civil penalty in the amount of $2000.00; and, service of a 60 day suspension of alcoholic beverage license no. 70-00087, series 2-COP, to commence after service of this Final Order. Further, within 15 days after service of this Final Order, Respondent shall remit to the Division of Alcoholic Beverages and Tobacco reimbursement of investigative costs in the amount of $436.95 to be paid to the Fifth Circuit Narcotics Task Force, 124 East 3rd Avenue, Mt. Dora, Florida 32757.
DONE AND ENTERED this 21st day of September, 1988, in Tallahassee, Florida.
C. L. IVEY, DIRECTOR
Division of Alcoholic Beverages and Tobacco 725 South Bronough Street
Tallahassee, Florida 32399-1020
RIGHT TO APPEAL
This final Order may be appealed pursuant to Section 120.68, Florida Statutes, and Rule 9.110, Florida Rules of Appellate Procedure by filing a Notice of Appeal conforming to the requirements of Rule 9.110(d), Florida Rules of Appellate Procedure both with the appropriate District Court of Appeal and with this agency within 30 days of rendition of this Order accompanied by the appropriate filing fee.
COPIES FURNISHED:
Harry Hooper, Deputy General Counsel Department of Business regulation
C. John Coniglio, Esquire Post Office Box 1119 Wildwood, Florida 32785
John J. Harris, Jr., Chief Bureau of Law Enforcement
Ocala District Office
Division of Alcoholic Beverages and Tobacco
================================================================= DISTRICT COURT OPINION
=================================================================
IN THE DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA FIFTH DISTRICT JANUARY TERM 1990
PATRICIA FREEZE,
Appellant,
v. CASE NO. 88-1931
DOAH NO. 88-681
DEPARTMENT OF BUSINESS REGULATION, DIVISION OF ALCOHOLIC BEVERAGES AND TOBACCO, et al.,
Appellees.
/ Opinion filed February 15, 1990
Administrative Appeal from the Department of Business Regulation. John Coniglio, Wildwood, for Appellant.
Harry Hooper, Deputy General Counsel, Department of Business Regulation, Tallahassee, for Appellees.
SHARP, W. J.,
Appellant ("Freeze"), d/b/a Corral Bar, appeals from a final order of the Department of Business Regulation, Division of Alcoholic Beverages and Tobacco (the "Department") which revoked a beverage license of which she was a co-owner. She managed the Corral Bar during the relevant time periods in which violations occurred on the licensed premises. This order was contrary to some of the findings of fact and conclusions of law of the administrative hearing officer.
However, findings of the hearing officer which were accepted by the Department support some punitive action in this case. We strike some findings and conclusions of the Department, and remand for reconsideration of sanctions imposed in this case.
On October 17, 1987, the Department issued a notice to Freeze which charged that the bar operated by her was used by persons using, keeping, or selling controlled substances." 1/ The notice also charged Freeze with keeping a public nuisance in reference to the foregoing between the same time periods, December 1, 1986 and December 20, 1986. 2/ Freeze disputed these charges and requested and was granted a hearing on the matter. The hearing officer made, inter alia, the following findings of fact: (1) customers were routinely smoking pot on the porch of the building which was part of the premises; (2) Freeze tended bar
seventy-five percent of the time; and (3) Freeze entered the bar through the porch.
However, the Department rejected many of the hearing officer's findings 3/ and conclusions of law 4/ because it found a lack of competent, substantial evidence. It also made additional findings of fact which would have supported its conclusion that Freeze and Lee, her part-time bartender, had actual knowledge that cannabis was being smoked and sold on the premises, and that Lee actually sold undercover agents contraband in the parking lot. Contrary to the hearing officer's findings, and in the face of conflicting testimony in the record, the Department found that Lee was Freeze's part-time bartender/bouncer; that Freeze actually saw customers smoking pot on the porch; and that she observed the undercover agents smoking pot with her customers in the bar.
The hearing officer recommended that Freeze not be found guilty and that the charges be dismissed. The Department's final order found Freeze guilty of the violations charged and revoked the liquor license. The final order also provided that revocation would be lifted upon receipt of a civil fine of $2,000 and service of a sixty-day suspension, in addition to payment of certain investigative costs.
The Department had no authority to reject the findings of fact of the hearing officer which were supported by competent, substantial evidence.
Heifetz v. Department of Business Regulation, Division of Alcoholic Beverages and Tobacco, 475 So.2d 1277 (Fla. 1st DCA 1985). Factual issues susceptible of ordinary methods of proof that are not infused with policy considerations are the prerogative of the hearing officer as finder of fact. Heifetz: McDonald v. Department of Banking and Finance, 346 So.2d 569 (Fla. 1st DCA 1977). The Department thus erred in rejecting the hearing officer's findings of fact and in substituting its own where there was conflicting evidence, or sufficient evidence to support the hearing officer's findings. An agency may not reject the hearing officer's findings unless there is no competent, substantial evidence from which the finding could reasonably be inferred. Ferris v. Austin,
487 So.2d 1163 (Fla. 5th DCA), appeal dismissed, 492 So.2d 1330 (Fla. 1986).
However, the hearing officer's findings with respect to the smoking of pot on the porch, are sufficient, standing alone, to affirm the agency's final order. The findings by the hearing officer regarding the routine smoking of pot on the porch and Freeze's frequent proximity thereto, are legally sufficient to support a conclusion that Freeze had constructive knowledge of these activities. 5/ She was bound for her own protection to inquire into the situation. See Farish v. Smoot, 58 So.2d 534 (Fla. 1952); Industrial Supply Corp. v. Bricker,
306 So.2d 133 (Fla. 2d DCA 1975). One who has the means of obtaining knowledge under circumstances reasonably suggesting the need for inquiry, and who does not use the knowledge and means to obtain such information has "implied actual knowledge" of the information. Symons v. State, Department of Banking and Finance, 490 So.2d 1322 (Fla. 1st DCA 1986).
We therefore affirm the final order with respect to the Department's conclusion that Freeze should have known her licensed premise was resorted to by persons using, keeping or selling controlled substances contrary to sections 823.01, 823.10, and 561.21(1)(c), Florida Statutes, and that she was negligent in not taking steps to stop and halt such activities on her premises. However, we strike the additional findings of fact made by the Department because they are contrary to the hearing officer's findings or require a fact-finder to believe in the credibility of the witness who testified. Because we are reversing these latter findings, and necessarily the conclusions of law based on
them, we must remand the cause to the Department for reconsideration. Hodge v. Department of Professional Regulation of State of Florida, 432 So.2d 117 (Fla. 5th DCA 1983). Upon remand, the Department is to reconsider the revocation and other punitive measures in light of the limited findings upon which this order is being affirmed.
AFFIRMED in part; REVERSED in part and REMANDED. DAUKSCH, J., concurs specially with opinion.
GOSHORN, J., dissents with opinion.
GOSHORN, J., dissenting. 88-1931
I respectfully dissent. The evidence presented to the hearing officer relating to specific drug transactions concerned seven separate incidents which allegedly took place on six separate dates. The witnesses who testified about the first five transactions did not recall either Patricia Freeze or co-owner Frederick Koch being on the premises during the transactions. As to the last two transactions, the hearing officer specifically found no credible evidence presented that the transactions were observed or overheard either by Freeze or any other patron in the bar.
In addition, the hearing officer made the following pertinent findings:
No evidence was presented that any employee of respondent was ever in a position to either see, overhear or participate in the drug transactions. The drug negotiations inside the bar were therefore secret and not out in the open and were not capable of being discovered with the exercise of any diligence on respondents part.
Petitioner presented no evidence from which a reasonable person could conclude that respondent had any direct knowledge of the drug dealings going on in her bar.
In regard to the charge that Freeze failed to exercise due diligence in policing patrons of the bar who were found to have routinely smoked pot on the porch of the premises, the hearing officer found:
The evidence did not show that the respondent would recognize the smell of marijuana.
Ms. Freeze testified that on the few occasions that she had overheard someone discussing marijuana in her bar, she told them to take it elsewhere and did not permit such conduct in her bar. Additionally she had asked the local Wildwood police to do routine walkthroughs of the premises in order to keep illegal activity, predominately fighting, under control. The Wildwood Police Department complied with this request and performed the walkthrough twice a week.
From the evidence presented, petitioner did not show that respondent failed to exercise due diligence in policing her establishment.
Further, the evidence did not clearly and convincingly establish that the patrons' drug use was so open and flagrant as to place a reasonable person on notice of a drug problem.
Prior to the undercover (police) activity, Petitioner (The Department) had not received any formal complaints about the bar being a haven for drug activity. Consequently, the drug bust was the first time Ms. Freeze was apprised there was a problem with drugs at her establishment.
These findings contradict the Department's finding "that Patricia Freeze was aware of marijuana smoking on her licensed premises during all times pertinent."
88-1931
DAUKSCH, J. , concurring specially.
I concur with the conclusion reached by Judge Sharp because it is essentially in agreement with the conclusion reached by the appellee. I cannot agree with the statement that ". . . the Department is to reconsider the penalty. Perhaps the appellee may want to change the penalty, perhaps not; that is not for this court to say.
Clearly, the Department rejected the hearing officer's findings and substituted its own findings based upon its reevaluation of the evidence. Just as clearly, the Department had no authority to reject the hearing officer's findings of fact because the findings are supported by competent, substantial evidence. See Heifetz v. Department of Business Regulation. Division of Alcoholic Beverages and Tobacco, 475 So.2d 1277 (Fla. 1st DCA 1985). Factual issues susceptible of ordinary methods of proof that are not infused with policy considerations are the prerogative of the hearing officer as the finder of fact. Heifetz, supra; McDonald v. Department of Banking and Finance, 346 So.2d 569 (Fla. 1st DCA 1977). The agency may not reject the hearing officer's findings unless there is no competent, substantial evidence from which the finding could reasonably be inferred. Ferris v. Austin, 487 So.2d 1163 (Fla. 5th DCA), appeal dismissed, 492 So.2d 1330 (Fla. 1986). See also National Industries, Inc. v.
Commission on Human Relations, 527 So.2d 894 (Fla. 5th DCA 1988); Kinney v. Department of State. Division of Licensing, 501 So.2d 129 (Fla. 5th DCA 1987). In my view the Department thus erred in rejecting the hearing officer's findings of fact and substituting its own.
I would reverse the order of the Department with instructions to reinstate the beverage license.
ENDNOTES 1/ 893.13(2)(a)(5), Fla. Stat. (1985).
2/ 823.01, 823.10, 561.29(1)(c), Fla. Stat. (1985).
3/ Findings of fact rejected, either in whole or in part were: 6 (Fn 1, only), 10, 11, 12, 13, 14, 15, 16, 17, 18 and 19.
4/ Conclusions of law rejected, either in whole or in part, were: 9, 10 and 11.
5/ Where evidence shows a persistent or recurring activity, the fact-finder may infer that the licensee has knowledge. Golden Dolphin No. 2, Inc. v. State, Division of Alcoholic Beverages & Tobacco, 403 So.2d 1372 (Fla. 5th DCA 1981);
G. & B. of Jacksonville, Inc. v. State, Department of Business Regulation, Division of Beverage, 371 So.2d 139 (Fla. 1st DCA 1979).
=================================================================
AMENDED AGENCY FINAL ORDER
=================================================================
STATE OF FLORIDA DEPARTMENT OF BUSINESS REGULATION
DIVISION OF ALCOHOLIC BEVERAGES AND TOBACCO
DEPARTMENT OF BUSINESS REGULATION, DIVISION OF ALCOHOLIC BEVERAGES AND TOBACCO,
Petitioner,
vs. CASE NO. 88-0681
PATRICIA FREEZE and FREDERICK KOCH,
d/b/a CORRAL BAR,
Respondent.
/
AMENDED FINAL ORDER
COMES NOW the Director, Division of Alcoholic Beverages and Tobacco, and pursuant to the Mandate of the Fifth District Court of Appeal of the State of Florida, issued in Case No. 88-1931, on March 5, 1990, enters his Amended Final Order in the above styled cause pursuant to the authority vested by Chapter 120, Florida Statutes.
The Director, Division of Alcoholic Beverages and Tobacco, adopts the preliminary remarks, the findings of fact and conclusions of law of the Hearing Officer with the exception of conclusion of law number 11. The following conclusion of law is substituted therefore. The evidence is insufficient to demonstrate that Freeze had constructive knowledge of the activities alleged with the exception of the allegations of smoking of cannabis on the porch. The findings of the Hearing Officer that (1) customers were routinely smoking cannabis on the porch of the building which was part of the premises; (2) that Freeze tended bar seventy-five percent of the time; and (3) that Freeze entered the bar through the porch, are sufficient to support a conclusion that Freeze had constructive knowledge of these activities. She was bound for her own protection to inquire into the situation. See Farish v. Smoot, 58 So.2d 534 (Fla. 1952); Industrial Supply Co. v. Bricker, 306 So.2d 133 (Fla. 2nd DCA
1975). One who has the means of obtaining knowledge under circumstances reasonably suggesting the need for inquiry, and who does not use the knowledge and means to obtain such information has "implied actual knowledge" of the information. Symons v. State, Department of Banking and Finance, 490 So.2d 1322 (Fla. 1st DCA 1986).
ORDER
Based on the foregoing findings of fact and conclusions of law, the Respondents are found guilty of the violations charged in the Notice to Show Cause and the license is hereby revoked. This revocation shall be lifted and the consequent impairment of Respondents' qualifications shall cease upon receipt by the Division, within fifteen (15) days after the service of this Amended Final Order, of a civil penalty in the amount of one thousand, five hundred dollars ($1500.00). Furthermore, the license shall be suspended for a period of fifty-two (52) days, however, the licensee shall be given credit for fifty-two (52) days served prior to the stay being entered by the Appellate Court on November 16, 1988.
DONE AND ORDERED this 14th day of March, 1990.
C.L. IVEY, DIRECTOR
Division of Alcoholic Beverages and Tobacco
725 Bronough Street
Tallahassee, Florida 32399-1007
(904) 488-7891
Copies furnished:
C. John Coniglio, Esquire Post Office Box 1119 Wildwood, Florida 32785
Harry Hooper, Deputy General Counsel Department of Business Regulation
Michael Hawkins, Chief
Bureau of Law Enforcement -Northern District
L.B. Schoenfeld, Chief
Bureau of Licensing and Records
Mike Bays, Supervisor District Office 11
RIGHT TO APPEAL
This Final Order may be appealed pursuant to Section 120.68, Florida Statutes, and Rule 9.110, Florida Rules of Appellate Procedure by filing a Notice of Appeal conforming to the requirements of Rule 9.110(d), Florida Rules of Appellate Procedure, both with the appropriate District Court of Appeal and with this agency within 30 days of rendition of this Order, accompanied by the appropriate filing fee.
| Issue Date | Proceedings |
|---|---|
| Aug. 08, 1988 | Recommended Order (hearing held , 2013). CASE CLOSED. |
| Issue Date | Document | Summary |
|---|---|---|
| Feb. 15, 1990 | Opinion | |
| Sep. 21, 1988 | Agency Final Order | |
| Aug. 08, 1988 | Recommended Order | Respondent licensee will not be disciplined because she is not culpably responsible for the illegal drug sales by her bar's patrons on the premises. |
