BERRY, J.
The board of selectmen of Shrewsbury (board), acting as the licensing authority for the town of Shrewsbury (town), denied the plaintiff Grenier's application for a license to sell used cars. The board based the denial on its "Policy Number 9" (Policy 9),
We reverse the judgment denying the plaintiff's complaint for declaratory relief. We conclude that to the extent Policy 9 purports to set a per se cap, it is invalid as it conflicts with the statute governing the grant of class 2 used car dealer licenses.
Furthermore, even if we assume that Policy 9 is valid, as applied in this case, the board's denial of the plaintiff's application under Policy 9 appears to rest on an outright and absolute rejection of Internet sales as not beneficial to the town,
1. Procedural and factual background. At the time of Policy
In 2007, the plaintiff applied for a class 2 used car dealer license. At this time, there were twenty such licenses outstanding. As submitted to the board, the plaintiff's business plan provided that through Internet auction sites, the plaintiff would purchase and sell high-end, luxury, antique, and vintage automobiles. The plaintiff planned to store only three to five cars inside in a garage owned by his father's construction company. The garage is located in a limited industrial zoning district in the vicinity of multiple other commercial operations. The town's zoning board of appeals granted a variance to allow the proposed business to operate at the site. The police department, the treasurer's office, and the fire department approved the site for use as proposed by the plaintiff. The board, however, invoking Policy 9, voted to deny the plaintiff's application for a class 2 used car dealer license. Reduced to essentials, the board— without adequate findings and consideration of the particular facts underlying the application—rested the denial on the generalized concept that the public need was adequately met by the existing twenty licenses, and as previously noted, that out-of-State, Internet sales would not benefit the town.
The plaintiff filed a complaint in Superior Court, seeking entry of a judgment declaring that Policy 9 was invalid and in violation of G. L. c. 140, § 59. Beyond that declaration, the plaintiff also sought a declaration that the board's denial of the application was unlawful, not based on substantial evidence, and was arbitrary and capricious, and that, accordingly, an order should issue granting the plaintiff a class 2 license to sell used cars.
Following a bench trial, a Superior Court judge denied the requests for the entry of declaratory judgment and affirmed the decision of the board. First, with respect to the declaratory challenge to the validity of Policy 9, the judge held that the "[b]oard
2. Discussion. The requests for declaratory relief in this case are intertwined with the standards for judicial review under the used car dealer licensing statute, G. L. c. 140, § 59. Under that statute, an appellate court focuses on both "whether the decision of the [board] is based upon an error of law or is unsupported by substantial evidence." Ludvigsen v. Dedham, 48 Mass.App.Ct. 682, 685 (2000).
The used car dealer licensing statute imposes on a licensing board a requirement "to determine the facts and to pass upon the application in each instance under the serious sense of responsibility imposed upon [it] by [the board's] official position[] and the delicate character of the duty entrusted to [it]" (emphasis added). Roslindale Motor Sales, Inc., v. Police Commr. of Boston, 405 Mass. 79, 83-84 (1989), quoting from Mosey Café v. Licensing Bd. for Boston, 338 Mass. 199, 205 (1958). This responsibility for case-by-case review, as required by the licensing statute, must be based on neutral and defined standards. These are not present in Policy 9.
Furthermore, while there is broad discretion in reviewing license applications by a municipal authority, that discretion is not unfettered. See Roslindale Motor Sales, Inc. v. Police Commr. of Boston, 405 Mass. at 82; Goldie's Salvage, Inc. v. Board of Selectmen of Walpole, 31 Mass.App.Ct. 726, 730 (1992). The integrity of a licensing scheme depends upon standards that ensure fair and even-handed review of applications by the board, and a framework for judicial review of whether a particular decision is arbitrary and capricious, or based upon error of law. See Ludvigsen v. Dedham, supra. Policy 9 fails in these respects, as the policy lacks any fundamental standards. See, e.g., Turnpike Amusement Park, Inc. v. Licensing Commn. of Cambridge, 343 Mass. 435,
As noted, Policy 9 purports to be predicated on a capped maximum number of twenty class 2 licenses—notwithstanding that no such cap is provided for by the licensing statute. See G. L. c. 140, § 59. The board contends that Policy 9 is not a hard cap, but rather a flexible guideline, which, the board submits, is not in conflict with the licensing statute. We are not so persuaded.
Even assuming that Policy 9 were not invalid, there is an independent basis to set aside the board's action in this case. Because Policy 9 lacks standards, it allows for arbitrary and capricious application, such as occurred in this case.
For the foregoing reasons, the judgment of the Superior Court is vacated. A new decree shall enter declaring that
and
The case is remanded for proceedings consistent with this opinion.
So ordered.
As pertinent to this case, G. L. c. 140, § 58, as amended by St. 2002, c. 422, § 1, defines a license to sell used cars as follows: