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Legal Matters: Suitability and License Revocation

By November 1, 2017Connecticut, Top News, Legal Matters

By Jerry Farrell, Jr.

Jerry Farrell, Jr., Attorney

The recent revocation of Club Sexy’s permit drives home the point that there are certain “guardrails” for permittees and owners. The Liquor Control Commission acted in a few short months, moving through an investigation, compliance meeting and hearing that resulted in the revocation of Sexy’s permit on September 26, 2017.

The Commission cited the owner for suitability and losing control of the permitted premise. This spring, Hartford Police broke up a large brawl inside the café. The police had to use pepper spray and a patron brandished a weapon. The bar was also cited for allowing minors inside the café.

While Sexy was found to be out of compliance, pending appeal, there are lessons here for us all. Unlike other occupations and trades, like plumbers or your local retailer, a liquor establishment operates within a much more restrictive regulatory framework. Operating a liquor establishment is a trade requiring due diligence and careful compliance.

Liquor Control enforces the Liquor Control Act, and can “generally do whatever is necessary to carry out the intent of the chapter.” Also, the Commission may “revoke or suspend any permit upon cause found after hearing.” Therefore, liquor agents have the authority to enter the permit premises and seize, without force, records and evidence of liquor violations during an inspection of the permit premises. The Commission has broad jurisdiction and authority to fine, suspend or revoke a permit.

Here is a list of prohibitive rules that may render a person or premises unsuitable:

(a)        a backer or permittee who is financially irresponsible and fails to pay its debts. So, there could be trouble ahead if you can’t pay your bills,

(b)        receiving funds from a wholesaler or manufacturer or have a forbidden connection to another class of permit.  So, for example, a wholesaler can’t own a package store.

(c)        that the backer or permittee is in the habit of using alcohol to excess. This is self-explanatory.

(d)        that the backer or permittee have made a false statement to the department in a material manner. If you are unsure of what is being asked of you, get some help so you can be clear and truthful in the response.

(e)        that the backer or permittee has been convicted of violating a liquor law or has a felony conviction. The rule of thumb is to disclose the conviction on any application. The Department may prohibit you from holding a permit if the offense is directly related to the operation of the permitted premises. If the conviction is recent, it will weigh your degree of rehabilitation and the period of time since the conviction.

(f)         that the backer or permittee does not have full authority and control. There can be no hidden backer. Permittees and backers must have complete and full authority. This responsibility cannot be given to another party or vendor.

(g)        that the backer or permittee has violated any provision of the chapter. This is the catch-all provision. For example, in the case of Club Sexy, the backer and permittee could not control the premises, a violation of the liquor control act, and that failure resulted in the revocation.

So, where does this leave the average owner? Just be aware of all activities that may lead to questions of suitability. Control the interior of your premises. Make sure you have the appropriate policies and procedures in place. Communicate with your staff; they have to be on the same page as you, as they are your eyes and ears.

You can write-up all of the policies in the world, but if your team doesn’t clearly understand what you are trying to accomplish, no policy is going to help. A few tricks of the trade to ensure compliance are in order. Discuss and display the date of birth for a minor for your staff. Have a clear and understandable policy for checking ID. Identify and communicate who does it, when you do it and how is it done.

Are you controlling your permit premises? What do you do when there is a confrontation with a patron? As “The Simpsons” character Homer said, “Here’s to alcohol – the cause and solution to all life’s problems.”




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