IN RE: APPEAL of ‘ELAN of PHILA., LTD., 64 Pa. Commw. 230 (1982)

439 A.2d 905

Commonwealth Court of Pennsylvania.Argued November 18, 1981
January 22, 1982.

Liquor — Suspension of liquor license — Liquor Code, Act of April 12, 1951, P.L. 90 — Inducement for sale of liquor — Restaurant liquor license — Admission fee.

1. A restaurant and social club holding a restaurant liquor license does not violate provisions of the Liquor Code, Act of April 12, 1951, P.L. 90 forbidding the offer of inducements for the purchase of liquor, by establishing an admission fee system whereby any member of the public may gain access to the premises either by purchasing a membership or by paying an entrance fee each time and when no evidence suggests that discriminatory practices exist with respect to gaining entry. [234-5]

Argued November 18, 1981, before Judges WILLIAMS, JR., MacPHAIL and PALLADINO, sitting as a panel of three.

Appeal, No. 1431 C.D. 1980, from the Order of the Court of Common Pleas of Philadelphia County in case of In Re: Appeal of ‘Elan of Philadelphia, Ltd. from the Order of the Pennsylvania Liquor Control Board, No. 80-022387.

Liquor license suspension penalty imposed by Pennsylvania Liquor Control Board. Licensee appealed to the Court of Common Pleas of Philadelphia County. Appeal sustained. DURHAM, J. Board appealed to the Commonwealth Court of Pennsylvania. Held: Affirmed.

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J. Leonard Langan, Assistant Attorney General, with him James J. Fitzgerald, III, Chief Counsel, and Harvey Battle, II,
Acting Attorney General, for appellant.

Barry Goldstein, with him G. Craig Lord and Peter J. Boyer, Blan, Rome, Comisky McCauley, for appellee.

OPINION BY JUDGE WILLIAMS, JR., January 22, 1982:

This is an appeal by the Pennsylvania Liquor Control Board (Board) from an opinion and order of the Court of Common Pleas of Philadelphia County. The lower court reversed the Board’s order and vacated its penalty imposed upon appellee, ‘Elan of Philadelphia, Ltd.

Appellee, ‘Elan of Philadelphia, Ltd. (‘Elan) is a restaurant and social club owning and holding a restaurant liquor license, amusement permit and Sunday sales permit. A person wishing to patronize ‘Elan can gain entry to the establishment in one of two ways. The patron can either purchase an annual or lifetime membership card to the club, or he can pay an entrance fee each time he wishes to gain access to the facility.[1] Those people holding membership cards to the club can enter without waiting in line. Additionally, they are afforded certain guest and billing privileges. On the other hand, non-members are required to wait in line to pay their fee and are admitted on a first come first served basis.

In July, 1979, ‘Elan received a citation issued by the Board, charging it with violating the provisions of the Liquor Code.[2]

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The summons read,

WHEREAS, the Board is in possession of facts which lead it to believe that you have violated the provisions of the Liquor Code (Act of Assembly approved April 12, 1951, P.L. 90), as amended, and the rules and regulations adopted pursuant thereto, in the following manner:
1. You, by your servants, agents or employees offered and/or gave inducements to certain persons by allowing them privileges not permitted the general public, on or about April 24, May 9, 11, June 1, 1979, and on divers other occasions within the past year.

A hearing on the citation was conducted before a Board hearing examiner. In January, 1980 the Board issued an opinion and order sustaining the violation and imposing, as a penalty, a suspension for a period of three days, and thereafter until the conditions causing the issuance of the citation have been corrected. Following the Board’s decision, ‘Elan filed an appeal to the Court of Common Pleas of Philadelphia. The lower court held a de novo hearing in March, 1980. At the hearing, the lower court heard testimony relating to ‘Elan’s admission policy and the procedures followed in gaining entry to the restaurant and club. Subsequent to the hearing, the lower court, based on the testimony presented, rendered a decision reversing that of the Board and vacating the penalty imposed thereby. The court reasoned that ‘Elan’s mode of operation was neither in violation of nor offensive to the Liquor Code. It stated that the Board had erred in arriving at a contrary conclusion. The Board, in response to that opinion and order, filed the instant appeal to this Court.

The Board’s chief argument centers around its contention that ‘Elan’s admission policies are violative of the provision of the Liquor Code prohibiting the offering

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or giving of anything of value as an inducement for the sale of liquor.[3] In that regard, the Board asserts that ‘Elan’s practice of offering for sale yearly and lifetime memberships acts as an inducement for the purchase of alcoholic beverages. Specifically, the Board maintains that the inducement is the special treatment accorded a cardholder/member with respect to entrance, billing, and guest privileges.

The lower court held that ‘Elan’s admission practices were not contrary to Section 4-493(24) as they “were not within the contemplation of the legislature as prohibited conduct” when it enacted that section. We must agree with the lower court’s ruling. We feel that the Board’s interpretation of the provision in question is expansive and contrived. It seems illogical to conclude that the procurement of a club membership would act to influence or persuade a person to purchase

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alcoholic beverages. The privileges associated with the acquisition of a membership card are neither directly nor indirectly related to the sale of liquor. Cardholders do not receive free drinks or discounted prices when purchasing the same. Thus, we must find appellant’s argument to be without merit.

Appellant, while not arguing at length, briefly mentions a second basis to support its position that appellee, ‘Elan’s admission policy is in violation of the Liquor Code. Appellant contends that Section 4-491(6)[4] of the Code requires a licensed premises to be “at all times accessible to the use and accommodation of the general public . . .” ‘Elan’s membership policy, appellant asserts, does not accord the general public equal access, equal seating accommodations, and equal privileges while on the licensed premises. Thus, appellant states, ‘Elan’s entrance procedures are in contravention of Section 491(6) of the Code. Once again, our findings are not in agreement with appellant’s contention.

Our review of the evidence presented in the instant case reveals that ‘Elan’s premises is accessible to any person of legal age who is willing to either purchase a

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membership or pay an admission fee. There is not a scintilla of evidence indicating that ‘Elan employs any discriminatory practices with respect to gaining entry into its facility. Furthermore, a restaurant licensee which charges admission does not, by so doing, violate the condition that the premises remain open to the public. Schreiber Appeal, 46 Pa. D. C.2d 549 (1968).

For the aforementioned reasons, we must affirm the lower court’s decision.

ORDER
AND NOW, the 22nd day of January, 1982, the order of the Court of Common Pleas of Philadelphia County, in the above captioned matter, entered May 19, 1980, is affirmed.

This decision was reached prior to the expiration of the term of office of Judge PALLADINO.