ALJDEC

99A-0020-LIQ · Liquor Licenses and Control · 1999-08-09

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: August 9, 1999 APPEARANCES: Michael Joseph Brawley on behalf of the Licensee; Assistant Attorney General Patti Shelton on behalf of the Arizona Department of Liquor License and Control ADMINISTRATIVE LAW JUDGE: Lewis D. Kowal _____________________________________________________________________

FINDINGS OF FACT October 26 & 27, 1998 Incident-(Counts 1,2,3, &4) 1. The Arizona Department of Liquor License and Control (“Department”) contends that on October 26, 1998, from 10:00 p.m. through 1:00 a.m. on October 27, 1998, the Oxbow Inn & Steakhouse, Inc. (“Licensee”), through its employees, violated several provisions of the Arizona liquor laws concerning an incident involving a person under the age of twenty-one. 2. In support of the above-mentioned liquor violations, the Department presented the testimony of Dean Faust, a police officer with the City of Payson (“Officer Faust”). 3. Officer Faust testified that on October 27, 1998, at approximately 1:15 a.m., Doc Dimbot, a police officer with the City of Payson (“Officer Dimbot”), arrived at the location in front of the Oxbow Inn (the “licensed premises/licensed business”) in Payson, Arizona, to assist two women who could not start their vehicle. The driver of the vehicle was a 25 year old woman identified as Lisa Barnish (Ms. Barnish)”, known as Lisa Carl. The passenger of the vehicle was a 17 year old woman identified as Sara Callison (“Ms. Callison”), known as Sara Foil. 4. While at the scene, Officer Dimbot placed a radio call for assistance and Officer Faust was dispatched to the Oxbow Inn. Upon arrival, Officer Faust observed Ms. Callison to be intoxicated. Upon further investigation, Officer Faust determined Ms. Callison to be 17 years of age. 5. Officer Dimbot requested that Officer Faust take Ms. Callison to the Gila County Sheriff’s Department to begin the juvenile referral process. During that processing, Ms. Callison was advised of her Miranda rights. Subsequently, she provided information as to her activity the evening of October 26, 1998, and the morning of October 27, 1998. 6. Officer Faust testified as to the events set forth below as described to him by Ms. Callison. On the evening of October 26, 1998, Ms. Barnish, a friend of hers, convinced her to go out to the Oxbow Inn by arranging for Ms. Callison’s 15 year old brother to baby-sit Ms. Callison’s child. The brother received spirituous liquor from Ms. Barnish as payment for the baby-sitting services. Upon arriving at the Oxbow Inn, Ms. Barnish told the front door bouncer that Ms. Callison was 23 years old and was “up from the Valley”. Both Ms. Barnish and Ms. Callison were then allowed to enter the Oxbow Inn. Ms. Barnish obtained an alcoholic beverage from the bartender while Ms. Callison went to the rest room. Within an hour, Ms. Callison consumed several alcoholic beverages and left the Oxbow Inn. Upon attempting to leave the Oxbow Inn whereupon the vehicle, driven by Ms. Barnish, would not start. 7. While Officer Faust’s testimony is determined to be credible, in that the Administrative Law Judge believes that Ms. Callison made the statements to Officer Faust. However, there is no evidence presented establishing the reliability of the statements made by Ms. Callison. The evidence establishes that there was no follow up investigation or interviews with either Ms. Barnish or any employees or patrons of the Oxbow Inn to corroborate the statements made by Ms. Callison. Under the circumstances, and taking into consideration that the statements made by Ms. Callison to Officer Faust were made while she was intoxicated, it is determined that Ms. Callison’s are determined to be unreliable hearsay and are not given any weight. January 1, 1999 Incident (Count 5) 8. On January 1, 1999, Donald Kasl, a police officer with the City of Payson (“Officer Kasl”), while in his patrol car, heard a report from a Gila County Deputy Sheriff that a vehicle with an impaired driver was heading into Payson on Highway 20. 9. Officer Kasl drove out to Highway 20 and observed that the passenger of the vehicle, Richard Bilbie (“Mr. Bilbie”), that had been stopped by the Gila County Deputy Sheriff, was intoxicated and a tow truck arrived to tow the vehicle into Payson. Officer Kasl determined that Mr. Bilbie was intoxicated because he observed Mr. Bilbie walking unsteady, he had red and watery eyes, and he smelled of alcohol. 10. Officer Kasl observed Mr. Bilbie to obtain a ride into Payson with the tow truck. Officer Kasl left the scene around the same time as the tow truck and drove into Payson. 11. While in Payson, Officer Kasl observed Mr. Bilbie walk into the Pioneer Bar. After approximately fifteen minutes, Officer Kasl went into that establishment and observed Mr. Bilbie at the bar with what appeared to be an alcoholic beverage. Officer Kasl spoke to the bartender and informed her that Mr. Bilbie was already intoxicated and should not be in the bar having spirituous liquor. Officer Bilbie informed the bartender that the matter would be referred to the Department. 12. After the above-mentioned conversation, Mr. Bilbie was told to leave the Pioneer Bar and did so. Mr. Bilbie informed Officer Kasl that he was drunk and he would walk up the street to visit a friend of his. Subsequently, Officer Kasl observed Mr. Bilbie walk up the street and proceed to enter the Oxbow Inn. After approximately twenty minutes, Officer Kasl entered the Oxbow Inn and observed Mr. Bilbie at the bar holding in his hand what appeared to be an alcoholic beverage. Officer Kasl approached the bartender and informed her that Mr. Bilbie was already intoxicated and should not be in the bar having spirituous liquor. Officer Kasl requested to speak to the manager of the licensed business and spoke to several other individuals who represented themselves to be of a supervisory capacity. Officer Kasl informed those individuals that he would not be issuing any citation and that the matter would be referred to the Department. Subsequently, Officer Kasl observed Mr. Bilbie leave the Oxbow Inn. 13. Although Officer Kasl did not examine the beverage held by Mr. Bilbie in the Oxbow Inn, based on the totality of the circumstances, including the conversations he had with the Licensee’s employees concerning the incident wherein no one denied that Mr. Bilbie was served an alcoholic beverage, a reasonable inference can be made that the beverage Mr. Bilbie was served at the Oxbow Inn was an alcoholic beverage. It is also determined that prior to and during the time Mr. Bilbie was in the licensed premises, Mr. Bilbie was obviously intoxicated within the meaning of A.R.S. §4-244(14). Michelle Monti acting as manager and controlling person-Counts 6&7) 14. The Department contends that during September 1998, Michelle Monti was acting as the manager of the licensed business without having filed with the Department a Manager’s Agreement, that Michelle Monti had a controlling interest in the business and that such interest was not disclosed in any filings made with the Department concerning the Licensee. 15. During August 1998, Department Investigator Teresa Morse (“Investigator Morse”) was in the Payson area assisting local law enforcement officers as a result of the rodeo and special event license that had been issued . In the course of that assignment, Investigator Morse observed an individual at the Oxbow Inn who appeared nauseated and falling down. That individual was not removed from the licensed premises or assisted by security of the licensed business. Subsequently, Investigator Morse spoke with Michael Bloomer (“Mr. Bloomer”), the agent for the Licensee, regarding service to an intoxicated person. Mr. Bloomer was informed that no citation would be issued at that time and the Department would be contacting him about the incident. 16. As a result of the above-mentioned incident, a letter was sent by the Compliance Division of the Department to Mr. Bloomer. Michelle Monti (“Ms. Monti”) responded to the compliance letter and scheduled a meeting with Susie Hamilton (“Ms. Hamilton”), a compliance officer with the Department. 17. On September 15, 1998, a meeting was held at the Department with Ms. Hamilton and Ms. Monti. During a discussion concerning the violation that allegedly occurred, Ms. Hamilton asked Investigator Morse to join the meeting. 18. Investigator Morse testified that at the above-mentioned meeting, Ms. Monti expressed concern as to having a black mark against her license as a result of the August 1998, incident and maintained that the Oxbow Inn did nothing wrong. At that time, Ms. Monti represented herself to be the owner of the licensed business. 19. After the September 15, 1998, meeting, Ms. Hamilton brought to Investigator Morse’s attention that the Department’s records do not show Ms. Monti as being an owner or shareholder of the licensed business. Subsequently, Investigator Morse’s superior, Lieutenant Norman Perkins (“Lieutenant Perkins”), suggested that Investigator Morse conduct a further investigation as to Ms. Monti’s involvement in the licensed business. 20. Investigator Morse reviewed documents contained in the Department’s records including documents that the Licensee had filed with the Arizona Corporation Commission. The documents did not show Ms. Monti as being an officer, shareholder of the Licensee or having a controlling interest in the licensed business. 21. On November 3, 1998, Investigator Morse went to the Oxbow Inn to examine documents. Investigator Morse introduced herself to the bartender and was referred to the following individuals: a) Christine Brown (“Ms. Brown”), who identified herself as the banquet manager; b) Nemsio Yates (“Mr. Yates”), who identified himself as a manager; and c) Cindy Fitch (“Ms. Fitch”), who identified herself as a bar manager. 22. During the above mentioned visit, Mr. Yates told Investigator Morse that he was hired by Ms. Monti on September 13, 1998. Mr. Yates also mentioned that Ms. Monti was the owner of the licensed premises, that she has the ability to hire and fire employees, and that she has the authority to write checks for the licensed business. 23. The Department’s records on the Licensee do not show that a Manager’s Agreement has been filed for Ms. Monti, Mr. Yates or Ms. Fitch. 24. While Investigator Morse was at the Oxbow Inn, Ms. Brown placed a telephone call to Ms. Monti who asked to speak to Investigator Morse and inquired why Investigator Morse was at the licensed premises. Investigator Morse informed Ms. Monti that she was investigating Ms. Monti’s involvement in the licensed business and was present to review business documents. 25. Investigator Morse’s review of documents provided to her revealed that there had been a checking account for the licensed business with Ms. Monti., David Bloomer, a former manager and brother of Michael Bloomer, and Michael Bloomer as signers on the business checking account. Ms. Monti informed Investigator Morse that due to some problems with David Bloomer that account was closed. A new business account was opened with Bank One with Ms. Monti, Michael Bloomer, Angel Barrios, and Cindy Fitch as signers on the account. 26. On November 5, 1998, Lieutenant Perkins had a telephone conversation with Ms. Monti wherein Ms. Monti represented that she had provided $30,000.00 to Michael Brawley and Esther Brawley, her children, for their purchase of the licensed business. 27. During that telephone conversation, Ms. Monti disclosed that she had a felony conviction in November 1995. Lieutenant Perkins relayed the above-mentioned telephone conversation to Investigator Morse who testified about the substance of the conversation. 28. Investigator Morse testified that she recalled seeing a document faxed by Ms. Monti showing that she completed the terms of her probation concerning the above-mentioned felony conviction. 29. Investigator Morse testified that Ms. Monti was convicted of Misprisionment, a felony, but could not provide specific information about the conviction. However, during the hearing, Mr. Bloomer acknowledged that Ms. Monti did have a felony conviction. The Licensee did not dispute or offer any evidence to refute the Department’s evidence that Ms. Monti was convicted of a felony in November 1995. 30. According to Investigator Morse, because of the above-mentioned conviction, the Arizona liquor laws prohibit Ms. Monti from owning a controlling interest in a licensed business and/or managing such a business. 31. The Licensee contends that Ms. Monti is a mother who has years of restaurant experience who was trying to assist her children in starting a business. Further, the Licensee attempted to show that Ms. Monti was only staying at the Oxbow Inn for several months around September 1998, that she did not and does not have a controlling interest in the Licensee nor did she manage the licensed business during the time period in issue. The Licensee fails in its efforts to satisfactorily explain why an employee maintains that Ms. Monti owns and manages the business and why she has been and is a signer on the business account. Ms. Monti’s appearance at the above-mentioned compliance meeting without the appearance of any other Licensee representative and her continued involvement in the licensed business supports a finding that Ms. Monti was acting as a manager and a person with a controlling interest in the licensed business. 32. The Licensee presented evidence that Ms. Monti with her attorney met with Lieutenant Perkins and Investigator Morse wherein Ms. Monti recanted her statements that she was the owner of the licensed business. The Licensee claims that Ms. Monti was concerned as to her reputation because the business name is Michele Monti’s Oxbow Inn. 33. Investigator Morse testified that City of Payson officials and the Payson Fire Department dealt with Ms. Monti as the representative of the Oxbow Inn on several matters. 34. The Administrative Law Judge is not persuaded by Ms. Monti’s subsequent actions. There is persuasive and compelling evidence establishing that Ms. Monti was acting as a person with a controlling interest in the licensed business in September, 1998. 35. Although the Licensee would have this tribunal believe that it is not responsible for the acts of Ms. Monti, the Licensee placed Ms. Monti in a position so that she could proceed to act in the manner she did and made no attempts to either inquire as to her actions or to stop them. 36. During Mr. Bloomer’s testimony, it was apparent that he did not know or understand the Arizona liquor laws even though he presented testimony that he attended two alcohol training programs, one of them being a management course approved by the Department. 37. The evidence of record shows that Mr. Bloomer is not fit to be an agent for the Licensee because he spends most of his time on another full time job, is not familiar with the Arizona liquor laws, has not operated the business in accordance with the Arizona liquor laws by allowing a convicted felon to manage and operate the licensed business. CONCLUSIONS OF LAW 1. The evidence of record fails to establish that Ms. Callison was in the Oxbow Inn on October 26 or 27, 1998, and therefore the allegations of the Licensee failing to obtain proper identification of Ms. Callison, allowing her to remain on the licensed premise, the furnishing or selling of spirituous liquor to Ms. Callison, or allowing her to possess spirituous liquor are not substantiated. Therefore, the Department fails to establish that the Licensee violated A.R.S. §§4-241(A), 4-244(9), 4- 244(16), or 4-244(23) with respect to those allegations. 2. The evidence of record establishes that on January 1, 1999, an employee of the Licensee served Mr. Bilbie, an obviously intoxicated individual, spirituous liquor, in violation of A.R.S. §4-244(14) 3. The evidence of record establishes that on September 1998, Ms. Monti was acting as a manager of the licensed business and that the Licensee did not file a Manager’s Agreement with the Department showing Ms. Monti to be the manager of the business as required by A.R.S. §4-202(C). 4. The evidence of record establishes that on September 1998, Ms. Monti was acting as a person having a controlling interest in the licensed business and that the Licensee did not file the appropriate documents with the Department to reflect that situation, as required by A.R.S. §4-203(I). However, the evidence of record fails to support a finding that there was any assignment, sale, or transfer of ownership of the license in question to Ms. Monti and therefore, the Department fails to establish that the Licensee violated A.R.S. §4-210(A)(6). RECOMMENDED ORDER Based on the above, it is recommended that Spirituous Liquor License Number 06040034 be revoked within 60 days of the effective date of the order issued in this matter, unless on or before such time, the Licensee: a) obtains a properly qualified agent; and b) that all employees of the Licensee who serve, sell or furnish spirituous liquor, as well as all managers of the business attend an alcohol training program approved by the Department and provide certificates of completion to the Department. It is further recommended that within 45 days of the effective date of the Order entered in this matter the Licensee pay a civil penalty to the Department in the sum of $400. Done this day, August 20, 1999.

______________________________________ Lewis D. Kowal Administrative Law Judge

Original transmitted by mail this ____ day of August, 1999, to:

Howard Adams, Director Liquor Licenses and Control ATTN: Susie Hamilton 800 West Washington, 5th Floor Phoenix, AZ 85007

By ___________________________ -----------------------

Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826