Piscatelli v. Board of Liquor License Commissioners

ELDRIDGE, Judge. Under Maryland Code (1957, 2001 Repl.Vol.), Article 2B, § 11 — 304(d)(2), the holder of a class B-D-7 liquor license in Baltimore City must “cease all operations, including the serving of alcoholic beverages or food and providing entertain ⁶²⁷ ment,” between “2 a.m. and 6 a.m.” The principal issue raised in this case is whether that portion of § 11 — 304(d)(2) relating to ceasing operations, serving food, and providing entertainment between 2 a.m. and 6 a.m., violates Article XI-A of the Maryland Constitution, known as the Home Rule Amendment. The plaintiffs-appellants also present a statutory interpretation issue concerning the applicability of § 11 — 304(d)(2) and a federal constitutional challenge to § ll-304(d)(2) based upon the First Amendment and the Equal Protection Clause of the Fourteenth Amendment. 1 I. Nicholas Piscatelli is the individual licensee for the Redwood Trust, LLC, both of whom are the plaintiffs-appellants in this case (hereafter collectively referred to as “Piscatelli”). Pisca-telli operates a tavern business with live entertainment and dancing in Baltimore City, located in a zoning district where such use is conditionally permitted.

A “Conditional Use Approval” by the Baltimore City Board of Municipal and Zoning Appeals, dated October 26, 2001, and a “Use” permit issued by the Baltimore City Department of Housing and Community Development on November 2, 2001, authorize Piscatelli to use the premises as a restaurant, serving food and providing live entertainment and dancing, “after hours” which means after 2 a.m. Piscatelli has a class B-D-7 liquor license, which authorizes the licensee “to sell all alcoholic beverages at retail at the place in the license described, for consumption on the premises and elsewhere from 6 a.m. to 2 a.m. on the following day, 7 days a week.” Maryland Code (1957, 2001 Repl. Vol), Art. 2B, § 8-203(d)(3). 2 When Piscatelli first opened for business in November 2001, he kept the establishment open until 4 a.m. on weekends, ⁶²⁸ relying on the Baltimore City zoning approval and the use permit. Piscatelli also requested that the Board of Liquor License Commissioners for Baltimore City (hereafter referred to as the “Liquor Board”) convert his liquor license from a class B-D-7 license to a class B license, as a class B license would allow him to operate and sell food (although not sell alcoholic beverages) after 2 a.m.

At a hearing on December 6, 2001, the Liquor Board denied Piscatelli’s request to convert his license and informed Piscatelli that it would enforce the 2 a.m. closing time required by § ll-304(d)(2). The record does not disclose that Piscatelli sought judicial review of the decision refusing to convert his license. On December 8, 2001, Liquor Board inspectors arrived at Piscatelli’s business at about 2:10 a.m. and found approximately 250 to 300 people on the premises, dancing to music supplied by two disc jockeys. Piscatelli and his employees refused to comply with the inspectors’ request to cease operations.

The Liquor Board then issued a “Violation Notice” to Piscatelli for keeping his establishment open in contravention of § ll-304(d)(2), and for refusing to cooperate with the Liquor Board inspectors, as required by Liquor Board Rule 3.02. 3 At a hearing before the Liquor Board, Piscatelli conceded that the establishment was open after 2 a.m. on the night in question. The Board decided that Piscatelli had violated § ll-304(d) and Rule 3.02, rejected Piscatelli’s legal arguments, and imposed penalties consisting of fines or, in the alternative, a suspension. Piscatelli filed in the Circuit Court for Baltimore City a petition for judicial review, presenting the same legal arguments which were made before the Liquor Board and which are made before this Court. The Circuit Court affirmed the decision of the Liquor Board, stating: ⁶²⁹ “The Liquor Board ... correctly interpreted Article 2B § ll-304(d). “Licensee concedes that on its face, the statute requires it to ‘cease all operations’ after 2:00 a.m.

However, Licensee argues that when read together with § 11 — 305(d), it is permitted to remain open after 2:00 a.m. because it provided entertainment. “Nothing in the language of ll-305(d) supports the argument that it implicitly grants a license, and any such interpretation would violate all rules of statutory construction----Section ll-304(d)(2) was enacted after § ll-305(d) ----§ 11 — 304(d)(2) is the specific provision and it controls. The fact that Licensee has a Use and Occupancy Permit ... that satisfies the provisions of § ll-305(d) does not require a different result. “Section ll-304(d)(2) does not violate the Home Rule Amendment because it does not regulate zoning. Thus, Parks [Park] v. Board, 338 Md. 366 , 658 A.2d 687 (1995) is inapplicable. Furthermore, it does not violate the First Amendment and/or Equal Protection Clause of the Fourteenth Amendment to the United States Constitution.

The statute does not suppress or greatly restrict access to live entertainment, which is afforded protection under the First Amendment, and there is a rational basis that justifies treating live entertainment places differently than the other businesses exempted.” Piscatelli noted an appeal to the Court of Special Appeals. Prior to any proceedings in the Court of Special Appeals, this Court issued a writ of certiorari. Piscatelli v. Board of Liquor, 371 Md. 613 , 810 A.2d 961 (2002).

II

In accordance with “the established principle that a court will not decide a constitutional issue when a case can ⁶³⁰ properly be disposed of on a non-constitutional ground,” 4 we shall first address Piscatelli’s statutory interpretation issue. If Piscatelli’s “after hours” operation does not violate Article 2B, § ll-304(d)(2), it will not be necessary for us to reach the state and federal constitutional issues raised by Piscatelli. Article 2B, § 11-304, provides in relevant part as follows (emphasis added in subsection (d)(2)): “ § 11-304. Consumption — In general. “(a) Consumption between 2 a.m. and 6 a.m. prohibited; penalty. — (1) Between 2 a.m. and 6 a.m. on any day, a person may not consume any alcoholic beverages on any premises open to the general public, any place of public entertainment, or any place at which setups or other component parts of mixed alcoholic drinks are sold under any license issued under the provisions of the Business Regulation Article, and an owner, operator or manager of the premises or places may not knowingly permit such consumption. “(2) Except as provided in this section, any person found consuming any alcoholic beverage on any premises open to the general public, and any owner, operator or manager of those premises or places who knowingly permits consumption between the hours provided by this section is guilty of a misdemeanor and, upon conviction, shall be fined not more than $50 and not less than $5. “(d) New Year’s Day exception. — (1) Except as provided in this subsection, this section does not apply to premises conducted on New Year’s Day by on-sale licensees in Baltimore City. ⁶³¹ “(2) In Baltimore City, a licensed premises shall cease all operations, including the serving of alcoholic beverages or food and providing entertainment, at the closing hour for that class of licensed premises specified in this article. “(3) Notwithstanding paragraph (2) of this subsection, the Board of Liquor License Commissioners may grant an exemption for remaining open after hours to: “(i) A holder of a Class B restaurant license, only for serving food to patrons seated for dining; or “(ii) A pharmacy that fills prescriptions. “(4) A pharmacy that receives an exemption under paragraph (3) of this subsection may also sell products other than alcohol after normal closing hours. “(5) Notwithstanding the hour restrictions under paragraph (2) of this subsection, a hotel that holds a Class B license and serves food to seated customers or to private functions or guest rooms may continue to provide food service.” Piscatelli “acknowledges that a plain reading of Article 2B, § ll-304(d), without reference to any other provisions of the liquor laws, would support the Liquor Board’s position that Licensee did not come within one of the exemptions specified in that subsection, and would therefore be required to close all business operations at 2:00 a.m.” (Appellants’ brief at 5).

Nevertheless, Piscatelli argues that Article 2B, § ll-305(d), “provides a fourth exemption to the proscription outlined in Article 2B, § ll-304(d).” (Ibid.). Section ll-305(d) states as follows: “(d) Registration, compliance with other laws. — The owner, operator, or manager of any premises open to the general public or of any place of public accommodation where any form of entertainment is provided between 2 a.m. and 6 a.m. on any day and where alcoholic beverages are consumed at any hour of the day shall: “(1) Register with the fire department and the Department of Housing and Community Development; and ⁶³² “(2) Comply with all federal, State, and city building, fire, health, and zoning laws.” Section ll-305(d), however, does not contain an authorization for any licensee to operate or provide entertainment between 2 a.m. and 6 a.m. Rather, the statutory provision simply imposes certain registration and compliance obligations upon a licensee which is authorized to, and does, operate and provide entertainment between 2 a.m. and 6 a.m. The holder of a class B-D-7 license is not so authorized.

Moreover, Piscatelli’s interpretation of § ll-305(d) would render nugatory the prohibition in § ll-304(d)(2) that a class B-D-7 licensee “cease all operations, including ... providing entertainment,” between 2 a.m. and 6 a.m. As this Court has often emphasized, “we do not construe enactments so as to render ‘any portion ... superfluous or nugatory,’ ” Atlantic Golf v. Maryland Economic Development Corporation, 377 Md. 115, 125 , 832 A.2d 207, 213 (2003), quoting Facon v. State, 375 Md. 435, 446 , 825 A.2d 1096, 1102 (2003). The legislative history of § ll-304(d)(2) confirms the Liquor Board’s interpretation of the statutory provision. Section 11-304(d)(2) was added to Article 2B by House Bill 1154 of the 2000 session of the General Assembly. 5 The Floor Report for House Bill 1154 set forth the Bill’s purpose as follows (emphasis supplied): “The current [Liquor] Board policy is to require all licensees to cease all operations, except for the sale of food, at the closing hour specified for that class of license.

This requirement, however is not specified in the State law, and certain licensees have challenged the Board’s authority to adopt and enforce this policy. This bill addresses this problem by expressly requiring licensees to cease all operations at the closing hour for that class of license.” ⁶³³ This language shows the General Assembly’s intent that, under § 11 — 304(d)(2), a licensee with a B-D-7 license must cease all operations between 2 a.m. and 6 a.m. Finally, even if we were to agree with Piscatelli’s interpretation of § ll-305(d), which would make it inconsistent with § 11 — 304(d)(2), the language of § ll-304(d)(2) would be controlling. Section ll-305(d) was enacted by Ch. 482 of the Acts of 1993, to be effective October 1, 1993.

Section ll-304(d)(2), as previously pointed out, was enacted seven years later, by Ch. 461 of the Acts of 2000. Consequently, as the later enacted statute, the language of § ll-304(d)(2) would control to the extent of any inconsistency. See, e.g., Haub v. Montgomery County, 353 Md. 448, 462 , 727 A.2d 369, 376 (1999) (“the later enactment prevails to the extent of any inconsistency”), and cases there cited.

III

Piscatelli’s principal argument is that the General Assembly’s enactment of § ll-304(d)(2), insofar as the statute prohibits the serving of food and providing entertainment after 2 a.m., violated the constitutional restrictions upon the General Assembly’s authority which are set forth in Article XI-A of the Maryland Constitution. Piscatelli chiefly relies upon this Court’s decision in Park v. Board of Liquor License Commissioners, 338 Md. 366 , 658 A.2d 687 (1995). Baltimore City is a charter home rule jurisdiction under Article XI-A of the Maryland Constitution. As we have pointed out on numerous occasions, Article XI-A enabled Baltimore City and counties “ Vhich chose to adopt a home rule charter, to achieve a significant degree of political self-determination.’ ” Holiday Universal v. Montgomery County, 377 Md. 305, 313 , 833 A.2d 518, 523 (2003), quoting Tyma v. Montgomery County, 369 Md. 497, 504 , 801 A.2d 148, 152 (2002).

Article XI-A’s “purpose was to transfer the General Assembly’s power to enact many types of ... public local laws to the Art. XI-A home rule” jurisdictions, McCrory Corp. v. Fowler, 319 Md. 12, 16 , 570 A.2d 834, 835-836 (1990). ⁶³⁴ Article XI-A, § 2, of the Constitution requires the General Assembly to enact a grant of express powers for Baltimore City and the counties which have adopted home rule charters. The provision states: ■ “The General Assembly shall by public general law provide a grant of express powers for such County or Counties as may thereafter form a charter under the provisions of this Article. Such express powers granted to the Counties and the powers heretofore granted to the City of Baltimore, as set forth in Article 4, Section 6, Public Local Laws of Maryland [now codified as Article II of the Baltimore City Charter] shall not be enlarged or extended by any charter formed under the provisions of this Article, but such powers may be extended, modified, amended or repealed by the General Assembly.” Most of the express powers granted by the General Assembly pursuant to Article XI-A, § 2, are contained in Maryland Code (1957, 2001 RepLVol.), Article 25A for home rule counties, and in Article II of the Baltimore City Charter for the City of Baltimore. Some additional express powers are set forth in other public general laws.

For example, Maryland Code (1957, 2003 RepLVol.), Article 66B, §§ 2.01 et seq., expressly grants zoning authority to the Mayor and City Council of Baltimore. See Park v. Board of Liquor License Commissioners, supra, 338 Md. at 379 , 658 A.2d at 693 . Article XI-A, § 4, of the Maryland Constitution further provides in pertinent part as follows: “From and after the adoption of a charter under the provisions of this Article by the City of Baltimore or any County of this State, no public local law shall be enacted by the General Assembly for said City or County on any subject covered by the express powers granted as above provided. * * * ” In State’s Attorney of Baltimore City v. City of Baltimore, 274 Md. 597, 604-605 , 337 A.2d 92, 97 (1975), quoting State v. Stewart, 152 Md. 419, 424 , 137 A. 39, 41-42 (1927), we discussed the interplay of Article XI-A, §§ 2 and 4, as follows: ⁶³⁵ “Under these sections, while the General Assembly has the authority to determine what powers are to be exercised by Baltimore City or the charter counties, the General Assembly may not enact a public local law for the City or any charter county which modifies the powers so granted. If the General Assembly wishes to dimmish the powers granted to Baltimore City or a charter county, it must do so by amending the acts which granted the powers.

It may not do so by enacting a separate public local law which is merely inconsistent with the acts granting the express powers to the City or to the charter counties. These principles were explained by Judge [W. Mitchell] Digges for the Court in State v. Stewart, supra, 152 Md. at 424 , 137 A. 39 , as follows: ‘If the General Assembly, in its grant of powers to Baltimore City, subsequently concludes that the grant of powers contained a subject upon which the General Assembly should have authority to legislate, and not the city authorities, it can only accomplish this by amending or repealing the act granting and delineating the powers. The Legislature has the power to describe the field within which the local authorities may legislate, but having once done this, it cannot restrict or limit this field of legislation without changing its boundaries. The legislation in respect to the subjects contained in the granted powers is therefore committed exclusively to the local authorities and denied to the General Assembly, so long as the grant of powers remained unchanged.

Any other interpretation would render the provisions of article 11A meaningless, and result in nullifying the purpose sought to be accomplished by its adoption. If the Legislature could change the grant of power by the simple expedient of passing an act in conflict with the legislation of the local authorities, it would result in the complete frustration of the object of the amendment.’ ” As earlier pointed out, the authority to enact local zoning laws is among the express home rule powers granted to Baltimore City. In addition, the authority “[t]o ... regulate ⁶³⁶ ... the ... sale and disposition of food of every kind” is included among Baltimore City’s express powers. See Article II, § 8, of the Baltimore City Charter.

On the other hand, the regulation of alcoholic beverages is not within the express powers granted to Article XI-A home rule jurisdictions. Instead, the “General Assembly has preempted this area by Art. 2B of the Code,” Coalition v. Annapolis Lodge, 333 Md. 359 , 362 n. 1, 635 A.2d 412 , 413 n. 1 (1994). See, e.g., Board of Liquor v. Hollywood, 344 Md. 2, 12-13 , 684 A.2d 837, 842-843 (1996) (“The Maryland General Assembly, under Article 2B, indeed regulates the sale and distribution of alcoholic beverages with uncommon precision____Rather than providing broad general guidelines, the General Assembly has chosen to closely control by statute even the more detailed aspects of the alcoholic beverages industry”); State v. Petrushansky, 183 Md. 67, 70-71 , 36 A.2d 533, 535 (1944) (discussing the history of Article 2B’s enactment); Montgomery Co. v. Board of Supervisors of Elections, 53 Md.App. 123, 127 , 451 A.2d 1279, 1281 (1982) (“the Legislature has preempted the field of the regulation and control of alcoholic beverages”). Piscatelli argues that Article 2B, § ll-304(d)(2), is not a law regulating alcoholic beverages.

Instead, he contends (appellants’ brief at 10): “Article 2B, § ll-304(d) for the first time attempts to regulate the hours of operation for business operations totally unrelated to the sale or consumption of alcoholic beverages. It effectively precludes Licensee’s permitted use as an after hours establishment. Therefore, it has gone beyond a lawful liquor regulation and has become an unauthorized zoning regulation.” Piscatelli points out that he was “approved for a conditional use as an after hours establishment” pursuant to the Baltimore City zoning regulations, that he “was issued a Use and Occupancy Permit ... authorizing [him] to ‘use premises as a restaurant tavern with live entertainment and dancing with after hours establishment,”’ and that the Liquor Board’s ⁶³⁷ enforcement of § 11 — 304(d)(2) “totally precludes Piscatelli] from using [his] premises” in accordance with the local zoning regulations. (Id. at 8-10).

According to Piscatelli, the