STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

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

)

Petitioner, )

)

vs. ) CASE NO. 91-5784

)

CALDO CORPORATION, d/b/a )

CALYPSO BAY CLUB, )

)

Respondent. )

)

RECOMMENDED ORDER

On December 10, 1991, a formal administrative hearing was held in this case in Tallahassee, Florida, before J. Lawrence Johnston, Hearing Officer, Division of Administrative Hearings.

APPEARANCES

For Petitioner: Monica Atkins White, Esquire

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

For Respondent: Harold F. X. Purnell, Esquire

Oertel, Hoffman, Fernandez & Cole, P.A.

2700 Blair Stone Road Post Office Box 6507

Tallahassee, Florida 32314-6507 STATEMENT OF THE ISSUE

The issue in this case is whether the Petitioner, the Department of Business Regulation, Division of Alcoholic Beverages and Tobacco, should assess an extra $1,000 license tax against the Respondent, Caldo Corporation, d/b/a Calypso Bay Club, under Section 565.02(1)(g), Fla. Stat. (1989), for operating a place of business where consumption on the premises is permitted which allegedly "has more than three separate rooms or enclosures in which permanent bars or counters are located from which alcoholic beverges are served for consumption on the licensed premises."

PRELIMINARY STATEMENT

On or about May 16, 1991, the Petitioner, the Department of Business Regulation, Division of Alcoholic Beverges and Tobacco, issued a two-count Notice to Show Cause directed to the Respondent, Caldo Corporation, d/b/a

Calypso Bay Club. One count charged that the Respondent was "operating a place of business where consumption on the premises is permitted and which has more than three separate rooms or enclosures in which permanent bars or counters are located from which alcoholic beverages are served for consumption on the licensed premises," but was not paying the extra $1,000 license tax, as required by Section 565.02(1)(g), Fla. Stat. (1989).

The Respondent requested formal administrative proceedings under Section 120.57(1), Fla. Stat. (1989), and the matter was referred to the Division of Administrative Hearings on September 9, 1991. By Notice of Hearing issued on September 27, the matter was scheduled for final hearing on December 10, 1991.

At final hearing, the parties announced that they had settled, and entered into a consent final order on, one of the two counts in the Notice to Show Cause and that they were prepared to go to hearing on the remaining count, the one under which the Petitioner sought the imposition of the extra $1,000 license tax.

At final hearing, the Petitioner called one witness and had admitted in evidence the following Petitioner's Exhibits: 1, 2 (A through D), 3 (A through C), 4 (A through D), 5 (A and B), 6 (A through C and E), 8 (A through D) and 9. 1/ The Respondent called one witness.

Explicit rulings on the proposed findings of fact contained in the parties' proposed recommended orders may be found in the attached Appendix to Recommended Order, Case No. 91-5784.

FINDINGS OF FACT

1. The Respondent, Caldo Corporation, d/b/a Calypso Bay Club, operates a place of business in Clearwater, Florida, where consumption on the premises is permitted under license number 62-928, Series 4-COP SRX.

   
   

2. The licensed premises consist of some 18,000 square feet. Seven permanent bars are located within the perimeter walls of the licensed premises. No interior walls separate the bars, and they are not located in separate rooms. The seven bars are located in different parts of one large, generally open room.

   
   

3. A customer entering the Calypso Bay Club first enters a combination foyer/seating area. From this area, a customer can see throughout the area where the seven bars are located. All seven bars in the licensed premises are visible, at least in part, from the entrance foyer/seating area, although the view to some parts of the premises may be blocked. Two of the bars are located within an unobstructed, open lower level which is generally in the center of the premises. There is a dance floor in this lower level. The other parts of the licensed premises are located on deckings that are raised to varying heights above the dance floor area.

   
   

4. One of the bars, known as the Oyster Bar or bar number 7, is located on its own decking to one side of the dance floor area (to the customer's right on entering the premises.) It is three and a half steps, or approximately 18 inches, above the dance floor level.

   
   

   The other bars are arrayed on deckings on the other side (to the customer's left on entering the premises). Except for a lower, middle decking, the deckings on the left side of the premises are two steps, or approximately 12 inches, above the dance floor level.

   In the middle of that side, the decking is slightly lower than either the decking in front of it or the decking to the rear of it. One of the bars, known as the Fufu bar or bar number 5, is located on the middle decking.

   
   

   The other bars on that side are on one of the two higher deckings. The bar known as Deck 1 (bar number 4) is on a decking that wraps around to the entrance foyer/seating area. The bars known as Deck 2 (bar number 3) and the Corner bar (bar number 2) are on a decking located beyond the lower, middle decking.

   
   

5. Throughout the premises, where the flooring changes elevation, there is a wide, flat wood rail approximately 42 inches above the floor of the raised decking. The railing sits on top of, and is supported by, thick wood posts similar to posts used in the construction of docks. Thick hemp rope, consistent with a waterfront motif, also is wound around the posts and draped between them under the rails (as Christmas garland would be draped on a stairway bannister). All except in the area of the Oyster Bar (bar number 7), a smaller slat of wood about the size of a one by four also is nailed to the posts about five inches above the floor of the decking, forming a lower fence rail as well. In some places, banners are also hung from the railing.

   
   

6. The railing separating the different elevations serves two primary purposes. First, it is for safety to prevent customers from accidentally falling from a higher to a lower floor elevation. Second, it also serves as a counter on which customers standing or sitting on the higher elevation can set drinks or ash trays.

   
   

7. Openings in the railing permit customers to walk from one bar area to another. The deckings are accessible from the dance floor area by six fairly wide stairways. As previously mentioned, the stairway to the Oyster Bar has three steps; the others have just two steps.

   
   

8. Nothing separates the Corner bar (bar number 2) from the Deck 2 bar (bar number 3). Likewise, there is direct access from part of the Deck 2 bar to the Fufu bar (bar number 5). To one side of the Deck 2 bar, a railing separates the two elevations, but a railed ramp in the middle of the railing connects to two areas. It also is possible to get from the Fufu bar to the Deck 2 bar, without having to descend to the dance floor level, by walking from the Fufu bar, around a wood column, and step up one step to the area of the Deck 2 and Corner bars.

   
   

9. The Deck 1 bar (bar number 4) is the closest to the entrance foyer/seating area of the bars on that side of the premises. There are two ways to get from the Fufu bar to the Deck 1 bar. First, there is virtual direct access between the Fufu bar and the Deck 1 bar. Bar number 5 (the Fufu bar) is in an area one step lower than the other bars on that side of the dance floor area, including the Deck 1 bar. There is a short railed ramp that goes up alongside a wood column standing between the two bars. From the top of the ramp, there is direct access to the Deck 1 bar; from the bottom of the ramp, there is direct access to the Fufu bar. There also is indirect access by walking to the side opposite the ramp side into a small seating area. The seating area is separated from the Deck 1 bar by the one-step change in elevation and by a railing and two video games. There are two gaps in the railing where one can step up into the area where the Deck 1 bar is located.

   CONCLUSIONS OF LAW

   
   

10. Section 565.02(1)(g), Fla. Stat. (1989), provides in pertinent part:

    
    

    A vendor operating a place of business where consumption on the premises is permitted and which has more than three separate rooms or enclosures in which permanent bars or counters are located from which alcoholic beverages are served for consumption on the licensed premises shall pay, in addition to the license tax imposed in paragraphs (b)-(f), $1,000.

    
    

11. There was no evidence as to how the Department has applied the current version of Section 565.02(1)(g), Fla. Stat., to factual scenarios similar to the one in this case. Nor was there evidence of any relevant agency nonrule policy.

    
    

12. Section 565.02(1)(g), Fla. Stat. (1979), provided for the $1,000 extra license tax for operating a place of business having "more than three permanent separate locations serving alcoholic beverages for consumption on the premises." In ABC Liquors, Inc., v. Dept. of Business Reg., 397 So. 2d 696, 696 (Fla. 1st DCA 1981), the Department imposed the extra $1,000 license fee on a place of business having more than three bars "standing separately, staffed separately, opened and closed separately, and operated separately . . . notwithstanding that they are nearby each other in the same room." According to the dissenting opinion, the four bars in question were created by "aisles or rampways in a bar counter." Id., at 697. The court viewed as "critical" the finding of ultimate fact that "the design of the bar area within the room must be perceived as one primarily fashioned to suit the commercial needs of the Petitioner as opposed to the safety of the patrons." Id. The court upheld the imposition of the extra

    $1,000 tax.

    
    

13. The legislative history suggests that the Legislature enacted the current version of Section 565.02(1)(g) in response to the imposition of the tax in the ABC Liquors case. See March 25 and April 2, 1981, Reports of the Committee on Regulated Industries and Licensing on PCB 9 A, later enacted as section 13, Chapter 81-158, Laws of Florida (1981). 2/ It would appear that, as first proposed, the amendment to the law was intended to give effect to ABC's position that the law, as originally enacted, "was intended to apply only to licensees with more than three rooms from which beverages are served under a single license, such as hotels which operate in several locations throughout their complex." Id. It appears that, in subcommittee, the proposed legislation was amended to include the reference to "enclosures" that appears in the current law. The committee report states: "The purpose of this amendment was primarily to assure that hotels operating service bars, which may not qualify as "rooms", at beach or pool side were not exempted from such payment." Id.

    
    

14. It is clear enough that the Calypso Bay Club does not contain more than three separate rooms in which permanent bars or counters are located from which alcoholic beverages are served for consumption on the licensed premises. In common usage, the word "room" connotes spaces within a building separated from each other by floor-to-ceiling walls and connected to each other by doors and perhaps also hallways. The different bar areas in the Calypso Bay Club are not separated by walls or partitions, as different rooms would be.

    
    

15. The addition of the term "enclosure" in the statute broadens the application of the extra $1,000 license fee beyond just establishments having

    more than three separate rooms in which permanent bars or counters are located from which alcoholic beverages are served for consumption on the licensed premises. From the legislative history, it is safe to conclude that the Legislature intended to count a hotel's permanent poolside bar or beach bar, along with other permanent bars located in rooms inside the hotel, in determining whether the extra $1,000 license fee applies. But that insight is not particularly helpful in understanding the term "enclosure." (It does not answer the question, e.g., how many poolside bars to count if there are more than one.)

    
    

16. Turning, again, to common usage, Webster's New Twentieth Century Dictionary (2d Ed. 1979) defines "enclosure" as "something that encloses, as a fence, wall, etc. . . .." It defines the verb "enclose" as "to surround; to shut in; to hem in; to fence in; to confine on all sides; as, to enclose a field with a fence." Black's Law Dictionary (5th Ed. 1979) defines "enclosure" (spelled "inclosure"): "Land surrounded by some visible obstruction. An artificial fence around one's estate." It defines the verb "enclose" (spelled "inclose"): "To surround; to encompass; to bound; fence, or hem in, on all sides. To shut up."

    
    

17. It is concluded that, under the facts of this case, the Calypso Bay Club does not contain more than three separate enclosures in which permanent bars or counters are located from which alcoholic beverages are served for consumption on the licensed premises. The various railings and ramps, taken together, do not surround, encompass, close in or shut in any area of the licensed premises. They do not serve the purpose of a fence, nor would they be effective in serving as a fence. They are not an effective barrier against entry to any relevant portions of the interior of the premises. There is complete freedom of movement throughout the relevant portions of the interior of the premises. There are no doors or gates.

    
    

18. In reaching Conclusion of Law 8, above, no consideration is given to the nature of the operation of the various bars. The ABC Liquors court apparently considered it relevant, under the earlier version of the statute, to the question whether there were "more than three permanent separate locations serving alcoholic beverages for consumption on the premises," that the different bars were "staffed separately, opened and closed separately, and operated separately." ABC Liquors, Inc., v. Dept. of Business Reg., supra, at 696. But under the language of the current statute, and the facts of this case, the critical issue is whether there are more than three enclosures. On this issue, it is not considered to be relevant how the employees dress, what the colors and motifs of the bars are, how furniture is placed or how the different bars are operated.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Petitioner, the Department of Business Regulation, Division of Alcoholic Beverages and Tobacco, enter a final order dismissing the Notice to Show Cause in this case.

RECOMMENDED this 15th day of January, 1992, in Tallahassee, Florida.

J. LAWRENCE JOHNSTON 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 15th day of January, 1992.

1/ The Petitioner also offered in evidence Petitioner's Exhibit 7, a videotape to which the Respondent objected. At the hearing, ruling was reserved. At this time, the objection is sustained. The videotape is immaterial and irrelevant to the issue in this case, which is whether the Calypso Bay Club "has more than three separate rooms or enclosures." See Conclusion of Law 9, below.

2/ The evidence of the legislative history in this record may not be clear and complete. No such evidence was introduced at the final hearing. The Department attached to its proposed recommended order what appear to be certified copies of committee reports on the legislation.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 91-5784

To comply with the requirements of Section 120.59(2), Fla. Stat. (1989), the following rulings are made on the parties' proposed findings of fact:

Petitioner's Proposed Findings of Fact.

1.-3. Accepted and incorporated to the extent not subordinate or unnecessary.

1. Accepted and incorporated to the extent not subordinate or unnecessary. However, the lines referred to in the last sentence did not completely separate the five bars from the two bars; the drawings included the designation of steps leading from one elevation to another.

2. Accepted but subordinate and unnecessary.

3. There are two proposed findings 6. This addresses the first of them.

Subpart d. is rejected as not proven. The "small exposed part of bar 3" is not "cordoned off," and there is no wall. It is accessible from the steps from the dance floor area closest to the bar by walking from the steps to the bar, passing between the railing along the dance floor area and the partial wall (actually more like a wood column). (There also is access from the Corner bar and from the Fufu bar.)

Subpart e. is rejected as not proven. There is direct access, as well as indirect access, as stated above, subpart d.

Subpart f. is rejected as not proven. The "cordoned" railing has an opening through there is access to the Deck 1 bar (bar number 4). The Deck 1 bar also is directly accessible from the Fufu bar and from the entrance foyer/seating area.

Subpart g. is rejected as not proven. Bar number 5 is not enclosed. It is accessible by four alternative routes. There is direct access between part of the Deck 2 bar (bar number 3) and bar number 5. There also is access to other parts of the Deck 2 bar from the steps from the dance floor area closest to the bar, as described in subpart d., above, as well as via a ramp through an opening

in the railing along the change in elevation between the two bars. Finally, bar number 5 is accessible from the Deck 1 bar as described in subpart f., above.

Otherwise, the first proposed finding 6 is accepted and incorporated.

1. The second proposed finding 6 is rejected in part as not proven. As previously stated, there is direct access between the Corner bar (bar number 2) and the Deck 2 bar (bar number 3), as well as between part of the latter bar and bar number 5 (the Fufu bar.) Otherwise, accepted and incorporated.

2. Rejected in part as not proven. The televisions hang from the ceiling or are on a wood column, and the game machines are placed next to railings. Neither serves to form a separate barrier. The ropes do not in all cases, and in any case were not primarily intended to, separate bar areas. They are all along the upper level at an elevation change or are along steps or a ramp between two different elevations.

8.-9. Rejected as irrelevant to the question whether there are more than three "rooms or enclosures." See Conclusion of Law 9, above.

1. Rejected in part as not proven (last sentence); in part, accepted but subordinate to facts contrary to those found (first three sentences). The evidence suggested that the railings are there for two primary purposes. See Finding of Fact 6, above. The effect of the use of the railings as a bar counter was as much to join as to separate the various parts of the bar. A customer could put a drink, food or ash tray on one of the railings, or lean on it, and observe parts of the premises on the other side of the railing.

2. Rejected in part as argument and in part as not proven. The testimony regarding shortness of funds was part of an answer to a question on cross examination as to why there were different kinds of chairs and stools on the premises. The owner's intent and desire to increase profits does not prove liability for the additional $1,000 fee. The critical issue is the existence of more than three rooms or enclosures, a fact not proven by the evidence. Respondent's Proposed Findings of Fact.

1. Accepted but unnecessary.

2.-3. Accepted and incorporated.

1. Rejected as being conclusion of law or argument.

2. First sentence, rejected in part in that it is not "completely open." Third sentence, rejected in part in that there was no evidence to prove that the ramps are "fully handicap accessible." Fourth sentence, rejected in part in that there was no evidence to prove what the building code requirements were. Otherwise, accepted and incorporated.

3. Accepted and incorporated.

7.-8. Rejected as conclusion of law. COPIES FURNISHED:

Monica Atkins White, Esquire Assistant General Counsel Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32399-1007

Harold F. X. Purnell, Esquire Oertel, Hoffman, Fernandez

& Cole, P.A.

2700 Blair Stone Road Post Office Box 6507

Tallahassee, Florida 32314-6507

Richard W. Scully, Director Div. of Alcoholic Beverages

and Tobacco

Dept. of Business Regulation The Johns Building

725 South Bronough Street Tallahassee, Florida 32399-1000

Donald D. Conn, Esquire General Counsel

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

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

ALL PARTIES HAVE THE RIGHT TO SUBMIT TO THE DEPARTMENT OF BUSINESS REGULATION, DIVISION OF ALCOHOLIC BEVERAGES, AND TOBACCO, WRITTEN EXCEPTIONS TO THIS RECOMMENDED ORDER. ALL AGENCIES ALLOW EACH PARTY AT LEAST TEN DAYS IN WHICH TO SUBMIT WRITTEN EXCEPTIONS. SOME AGENCIES ALLOW A LARGER PERIOD WITHIN WHICH TO SUBMIT WRITTEN EXCEPTIONS. YOU SHOULD CONSULT WITH THE DEPARTMENT OF BUSINESS REGULATION, DIVISION OF ALCOHOLIC BEVERAGES AND TOBACCO, CONCERNING ITS RULES ON THE DEADLINE FOR FILING EXCEPTIONS TO THIS RECOMMENDED ORDER.

Docket for Case No: 91-005784

Orders for Case No: 91-005784