The Department of Alcoholic Beverage Control seeks a writ of prohibition to block the trial court from proceeding with the underlying declaratory-judgment action. The underlying action involves a controversy over the proper roles cities and the Department play in the process of distributing licenses to sell alcohol. The City of Somerset argues the Department usurped its statutorily defined role. In defense, the Department counters that Somerset's action violates Kentucky's constitutional separation of powers or, alternatively, is moot.
The Department fails to prove the necessary elements for a writ of prohibition so we decline to interpose such an extraordinary remedy.
Somerset, through a local-option election under Kentucky Revised Statutes (KRS) 242.125, approved the sale of alcoholic beverages. Following the election, Somerset enacted ordinances regulating the activity. The Department, under KRS 241:060, determined that Somerset was entitled to five retail-package liquor licenses and issued a notice to the public of their availability.
Fourteen businesses applied for the five licenses. In his discretion, Tony Dehner, the Department's Distilled Spirits Administrator, awarded the five licenses. Somerset then sued the Department seeking to increase the city's license allotment. Eventually, however, that lawsuit was dismissed through an agreement by both parties to resolve Somerset's concerns through the administrative process. The Department increased Somerset's allotment by amending its regulations. But Somerset's win was short-lived because the General Assembly's Administrative Regulation Review Subcommittee declined to approve the amended regulations providing a license increase.
Again, Somerset sued the Department, this time seeking declaratory and injunctive relief. In Somerset's estimation, the Department arbitrarily enforced regulations concerning license allotments and, by approving applications for state licenses before the city administrator approved applications, violated KRS 243.370. The Department responded by moving to dismiss Somerset's suit premised largely on separation of powers and the absence of proper standing by the city. The trial court denied the Department's motion, and this writ action followed in the Court of Appeals.
The Court of Appeals denied the Department's writ request because the Department failed to show the trial court was without subject-matter jurisdiction. According to the Court of Appeals, Somerset's declaratory-judgment action was appropriately within the trial court's province regardless of whether the injunctive relief sought by Somerset could actually be granted without violating Kentucky's strong doctrine of separation of powers. Further, the Court of Appeals noted that the Department's standing argument was insufficient for a writ to issue because there was an available remedy through appeal.
When ruling on a writ petition, we must first determine if the writ is appropriate. Only if the writ is appropriate do we look to the merits of the petition to determine the soundness of the trial court's decision. The decision whether to issue a writ always lies within this Court's discretion.
Essentially, writs are divided into two classes. Here, the Department presents an argument under both classes. The Department first argues the trial court is without jurisdiction to proceed. And, in the alternative, even if the trial court has jurisdiction, the Department argues it would be improper to proceed because Somerset lacks standing. Because jurisdiction and standing are questions of law, our review is de novo.
As we recently made clear in Davis v. Wingate,
In the context of writ actions, jurisdiction refers to subject-matter jurisdiction, meaning the authority not simply to hear "this case[,] but this kind of case."
The Department argues the trial court, because of Kentucky's strong doctrine of separation of powers, does not have the authority to grant the relief sought by Somerset, which is the authority to compel the Department to increase the city's license allotment. As accurate as this argument may be, it is immaterial to the trial court's subject-matter jurisdiction over Somerset's claim. KRS 418.040 makes clear that a "plaintiff may ask for a declaration of rights, either alone or with other relief; and the court may make a binding declaration of rights, whether or not consequential relief is or could be asked."
The Department's writ petition must fail because the trial court does have subject-matter jurisdiction and is, therefore, not about to proceed outside its jurisdiction.
The Department's second argument proceeds under the second class of writ; that is, the trial court is acting erroneously within its jurisdiction. According to the Department, the trial court was erroneous in finding Somerset had standing to challenge the allotment of licenses. When operating under this class of writ, both irreparable injury and lack of an adequate remedy by appeal must be proven by the writ-seeking party.
The Department has failed to prove it lacks an adequate remedy by appeal. In point of fact, our case law demonstrates standing is a proper issue for appellate review on direct appeal.
We admit that we may, in our discretion, "address the merits of the issue within the context of the petition for the writ[.]"
For the foregoing reasons, we deny the Department's petition for a writ of prohibition.
All sitting. All concur.