An Outline of the Legal Context of Liquor License
Revocation or Suspension Hearings
By Stewart H. Diamond
Under Illinois law, the Village President
or Mayor is automatically the Local Liquor Control Commissioner. The number
and type of liquor licenses available in a community are established by
the Village Board or City Council by ordinance. The Liquor Control Commissioner
has some discretion in awarding liquor licenses, but the standards are fairly
well established by State law. Once a liquor license has been issued, the
Liquor Control Commissioner is the individual granted the authority to consider
revocations or suspensions of such licenses. A Liquor Commissioner can appoint
other individuals to serve as a hearing officer in such cases with the final
decision being made by the Liquor Commissioner after reviewing the transcript
of the hearing and the report of the hearing officer. Many communities also
provide advisory commissioners who assist the hearing officer in holding
hearings, but play no role in the decision making process.
The Local Liquor Control Commissioner
may, after an appropriate hearing, revoke a license, suspend a license for
an extended period of time and impose a fine not to exceed $1,000 for each
violation. Each day on which the violation continues is considered a separate
violation. Not more than $10,000 in fines may be imposed against any license
during the period of the issuance of a license. Proceeds from such fines
are paid into the general corporate fund of a municipality.
The Local Liquor Control Commissioner
must give at least three days' written notice prior to holding a revocation
or suspension hearing. These hearings are required to be open to the public,
and an official record of the proceedings is to be maintained. If the Local
Liquor Control Commissioner believes that the continuing operation of a
particular licensed premises will immediately threaten the welfare of the
community, the Commissioner may, upon the issuance of a written order, and
without notice or hearing, close the licensed premises for no more than
seven days. The licensee must, however, be given an opportunity to be heard
during that period of time as to whether the emergency suspension will continue.
The Local Liquor Control Commissioner
shall, within five days after the close of a hearing, state the reason or
reasons for a revocation or a suspension in a written order. A copy of that
written order is to be served upon the licensee.
Any order or action of a Local Liquor
Control Commissioner involving a fine, granting or refusing to grant a license,
or passing on a request to revoke or suspend the license, is appealable
to the State Liquor Control Commission. An appeal can be taken both by the
licensee if it thinks that the fine is too severe, or by the prosecution
if it believes that the Commissioner has been too lenient. Many municipalities
have chosen to make an appeal to the State Commission rest upon the transcript
of the hearing before the Local Liquor Control Commissioner. The alternative
approach is to require all parties to put on new cases before the State
Commission. Where the suspension or revocation is the first one within a
12-month period, the licensee can remain open pending the State hearing.
In any case in which a licensee appeals to the State Commission a suspension
or revocation by a Local Liquor Control Commissioner that is the second
or subsequent suspension or revocation on the licensee within the preceding
12-month period, the licensee will cease all activity pending the appeal.
The State Commission shall review the propriety of the order or action of
the Local Liquor Control Commissioner and is required to consider the following
questions:
(a) Whether the Local Liquor Control Commissioner has proceeded in the
manner provided by law;
(b) Whether the order is supported by the findings;
(c) Whether the findings are supported by substantial evidence in light
of the whole record.
The State Commission is required to render a decision affirming, reversing
or modifying the order or action reviewed within thirty days after the appeal
was heard.
In the role of Local Liquor Control
Commissioner, the Village President or Mayor serves as a quasi-judicial
officer. Like a circuit court judge, the Local Liquor Control Commissioner
is required to base his or her decision strictly upon the evidence presented
at the hearing. Unlike the President of Mayor's role in a legislative function,
where that person is allowed to engage in independent fact finding, and
may speak to constituents or other persons, the Local Liquor Control Commissioner
must base a decision upon the evidence presented at the hearing. Because
the Local Liquor Control Commissioner functions in a quasi-judicial setting,
that individual is generally granted complete immunity from any lawsuit
seeking damages as a result of alleged errors in the process.
Both the State Liquor Control commission
and the Circuit or Appellate Courts, if reviews are carried further, grant
great deference to the decision of a Local Liquor Control Commissioner.
Decisions of a Local Liquor Control Commissioner are most easily overturned
in the event that there has been some procedural defect in the hearing process
and the licensee can prove that it did not receive due process of law. Where
the nature of the appeal rests upon an interpretation of the evidence, the
decision of the Local Liquor Control Commissioner will be supported if there
is any evidence in the record to support the decision reached. Courts will
frequently state that they will not overturn the decision of the Local Liquor
Control Commissioner even if they would have independently reached another
decision unless the ruling is against the manifest weight of the evidence.
This is a high standard for a licensee to overcome. Where a license is revoked,
the owner of the property is precluded from bringing in another tenant who
will sell liquor for a period of one year.
There are many circumstances under which
a suspension or revocation may be ordered. In some rare cases, the State
Commission or a court will affirm the decision of the Local Liquor Control
Commissioner as to the violation of State or local law, but will reduce
the penalty from, for example, revocation to an extended suspension. In
one such case, a suspension of 13 months was ordered, rather than the revocation.
Jacquelyn's Lounge, Inc. v. License Appeal Commission of Chicago, 214 Ill.
Dec. 565 (1996).
The decision of a Local Liquor Control
Commissioner to order a lengthy suspension or a revocation of a license
has been affirmed when it was based upon a wide variety of violations of
State or local law. Among those activities which have brought about a suspension,
revocation or a refusal to renew a liquor license are: Permitting drug activity,
prostitution, possession of unregistered firearms, discharging of firearms,
gambling, unlawful sale of obscene material, possession of stolen property,
deception in sales of related food products, and sale to minors.
The courts have sustained the ability
of a Local Liquor Control Commissioner to revoke a license when the licensee
has been found to have previously violated State or local law and had received
a prior suspension. One case that applied this rule, where a license was
revoked when the licensee was found to have served liquor to a minor and
five months earlier had been found guilty of a similar violation. Spiros
Lounge, Inc. v. State of Illinois Liquor Control Commission, 53 Ill. Dec.
562 (1981). Because the State Liquor Control commission and subsequent courts
only review the transcript of the initial hearing, they give great weight
to the determination of the Local Liquor Control Commissioner as to the
credibility of witnesses. In a disputed matter, it is generally important
that in the written findings of fact and conclusion of law, the view of
the hearing officer regarding the credibility of witnesses is stated. Where
the Local Liquor Control Commissioner is not an attorney, he or she is usually
assisted by a lawyer who makes recommendations regarding the admissibility
of evidence, motions made by the parties, and helps the Commissioner in
the drafting of the final order.
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