COURT OF APPEALS OF VIRGINIA 

Present: Judges Willis, Bray and Fitzpatrick 

Argued at Alexandria, Virginia 

BROWN-FORMAN CORPORATION 

 OPINION BY 

v. Record No. 0304-94-4 JUDGE RICHARD S. BRAY 

 MAY 23, 1995 

SIMS WHOLESALE COMPANY, INC., ET AL. 

FROM THE CIRCUIT COURT OF FAIRFAX COUNTY 

Jane Marum Roush, Judge 

 Thomas F. Farrell, II (Charles M. Sims; McGuire, Woods, 

 Battle & Boothe, on briefs), for appellant. 

 John Patrick Griffin, Assistant Attorney General (James S. 

 Gilmore, III, Attorney General; Michael K. Jackson, Senior 

Assistant Attorney General, on brief), for appellee 

 Virginia Alcoholic Beverage Control Board. 

 Philip F. Abraham (Walter A. Marston, Jr.; Randolph A. 

 Sutliff; Hazel & Thomas, P.C.; Miles & Stockbridge, on 

 brief), for appellee wine wholesalers. 

 Brown-Forman Corporation (Brown-Forman), a winery, sought to 

terminate distribution agreements with certain wholesalers 

(wholesalers) of its products in accordance with the provisions of 

the Wine Franchise Act, Code §§ 4.1-400, et seq. (the Act). 

Wholesalers challenged the termination as a violation of the Act 

and petitioned the Virginia Alcoholic Beverage Control Board (the 

Board) for relief. See Code §§ 4.1-407, -409. A panel designated 

by the Board ruled that termination of such agreements was 

permitted by the Act only for "wholesaler deficiency" or 

"situations of like character," circumstances not proven by BrownForman. On appeal by Brown-Forman to the Board, the Board adopted 

the panel decision. Brown-Forman sought judicial review pursuant 

to the Virginia Administrative Process Act, Code § 9-6.14:1, et

seq.
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 The trial court disagreed with the Board's construction of the 

Act but reached the same result, concluding that Brown-Forman had 

failed to establish "sufficient good cause to terminate." Before 

this Court, Brown-Forman contends that the evidence justified 

termination as a matter of law. Although we concur in the trial 

court's construction of the Act, we reverse the disposition and 

remand the proceeding to the Board for reconsideration of the issue 

of good cause. 

 The parties proceeded by "Stipulated Facts." Wholesalers 

distributed several "brands of . . . wines" within "established 

territories" throughout the Commonwealth under exclusive agreements 

with Brown-Forman, as supplier/winery. See Code § 4.1-404. 

Incidental to a "major reorganization of its sales organization," 

Brown-Forman determined that marketing of its products by "fewer 

wholesalers over broader geographical areas" would increase "market 

penetration, sales . . . and profits for both Brown-Forman and 

[its] wholesalers" and, therefore, "view[ed] consolidation from 

eighteen [Virginia] wholesalers . . . to four as a material 

benefit" to "its own economic . . . interest." Accordingly, BrownForman terminated existing distribution agreements with 

wholesalers, intending to thereafter "appoint and contract" with 

"fewer wholesalers over broader geographic areas." See Code 

§ 4.1-407. 

 The parties agreed that Brown-Forman's decision was not 

prompted by the "deficiency" of any wholesaler but, rather, a "good 

faith exercise" of Brown-Forman's "business judgment," calculated 
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to promote its "self interest." Consequently, the parties 

stipulated that "the sole issue presented . . . is whether the good 

faith exercise of business judgment by [Brown-Forman], absent any 

evidence of deficiency in the performance of the [wholesalers], is 

'good cause' pursuant to the [Act] for [Brown-Forman] to terminate 

unilaterally its agreements with [wholesalers]." 

 The Wine Franchise Act regulates the business relationship of 

the parties, as winery and wholesaler, through a comprehensive 

statutory scheme intended: 

 1. To promote the interests of the parties and 

the public in fair business relations between 

wine wholesalers and wineries, and in the 

continuation of wine wholesalerships on a fair 

basis; 

 2. To preserve and protect the existing threetier system for the distribution of wine 

. . . ; 

 3. To prohibit unfair treatment of wine 

wholesalers by wineries, promote compliance 

with valid franchise agreements, and define 

certain rights and remedies of wineries in 

regard to cancellation of franchise agreements 

with wholesalers; 

 4. To establish conditions for creation and 

continuation of all wholesale wine 

distributorships . . . . 

Code § 4.1-400. The Act "shall be liberally construed and applied 

to promote [these] underlying purposes and policies." Id.

 In furtherance of such "purposes and policies," the Act 

permits a winery to terminate an agreement with a wholesaler only 
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upon "good cause," Code § 4.1-406, and in accordance with Code 

§ 4.1-407.1

 Id. Unless expressly excused by statute, Code 

§ 4.1-407(F), a winery must provide a wholesaler timely written 

notice of its intention to terminate an agreement which "state[s] 

all the reasons" for such action. Code § 4.1-407(A). Thereafter, 

the wholesaler is assured an opportunity to rectify the "condition" 

cited by the winery, if possible. Code § 4.1-407(B). If the 

"reason relates to a condition which may not be rectified by the 

wholesaler," or remediation is in dispute, the wholesaler may 

request a hearing before the Board to determine if the winery acted 

upon "good cause." Code §§ 4.1-407(C), -407(D). 

 In a proceeding before the Board on this issue, "the winery 

shall have the burden of proving the existence of good cause." 

Code § 4.1-407(E). The statute specifies that "[g]ood cause shall 

not include the sale or purchase of a winery," a transaction 

governed by Code § 4.1-405, but expressly "shall include," though 

"not limited to," several enumerated circumstances, termed 

"wholesaler deficiencies" by the parties, none of which occurred in 

this instance. Code § 4.1-406 (emphasis added). Termination 

without the requisite "good cause" may result in reinstatement of 

the agreement or in payment by the winery to the wholesaler of 

"reasonable compensation for the value of [the] agreement" 

determined in accordance with the statute. Code § 4.1-409. 

 In addressing the instant dispute on the stipulated facts, the 

 

 1Compliance with the notice and remedial provisions of Code 

§ 4.1-407 is not in issue. 
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Board, by reference to the earlier panel decision, concluded that 

"[t]he act contains no language that permits a winery's unilateral 

cancellation of agreements with wholesalers in order to consolidate 

its distributors and to enhance its economic interests in the 

absence of wholesaler deficiency" (emphasis added). Applying the 

doctrine of ejusdem generis, the Board concluded that the several 

specific examples of "good cause" set forth in Code § 4.1-406 

manifested a legislative intent to permit termination only upon 

wholesaler deficiency and "situations of like character," 

irrespective of Brown-Forman's "self interest." 

 On judicial review, the trial court concluded that the Board's 

construction was unduly restrictive and that statutory "'good 

cause' does not require in every instance a showing of wholesaler 

deficiencies." The court reasoned that the specific statutory 

exclusion from "good cause" of "one situation" not involving 

wholesaler deficiency, the sale or purchase of a winery, "suggests 

that there are . . . actions by the winery which could" constitute 

statutory good cause, although unrelated to wholesaler deficiency. 

 Nevertheless, the trial court determined that the "business 

judgment exercised by Brown-Forman in this case . . ., without 

more[,] . . . is not sufficient 'good cause' under the statute" and 

affirmed the decision of the Board. (Emphasis added.) 

 Judicial review of "[a]ll proceedings under [the Act] shall be 

held in accordance with the Virginia Administrative Process Act 

(§ 9-6.14:1 et seq.)." Code § 4.1-410; see Code § 9-6.14:16. "The 

burden shall be upon the party complaining of agency action to 
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designate and demonstrate an error of law subject to review by the 

court." Code § 9-6.14:17. The reviewing court must accord 

considerable deference to an agency's resolution of factual issues, 

"ascertaining [only] whether there was substantial evidence in the 

. . . record upon which the agency as the trier of the facts could 

reasonably find them to be as it did." Id.; see EDF v. State Water 

Control Bd., 15 Va. App. 271, 277-78, 422 S.E.2d 608, 611 (1992) 

(citation omitted). 

 "In contrast, judicial review of a 'legal issue' requires 

'little deference,' unless it . . . 'falls within an agency's area 

of particular expertise.'" EDF, 15 Va. App. at 278, 422 S.E.2d at 

612 (quoting Johnston-Willis, Ltd. v. Kenley, 6 Va. App. 231, 

243-46, 369 S.E.2d 1, 8 (1988)). This distinction "recognizes the 

'special competence' of the judiciary to decide issues of 'common 

law,' 'constitutional law' or 'statutory interpretation'" and a 

concommitant responsibility not to "'merely rubber-stamp an agency 

determination.'" Id. "We are required to construe the law as it 

is written" and "'[a]n erroneous construction by those charged with 

its administration cannot be permitted to override the clear 

mandates of a statute.'" Commonwealth v. May Bros., Inc., 11 Va. 

App. 115, 119, 396 S.E.2d 695, 697 (1990) (quoting Hurt v. 

Caldwell, 222 Va. 91, 97, 279 S.E.2d 138, 142 (1981)). The 

intention of the legislature must always control. Last v. Va. 

State Bd. of Medicine, 14 Va. App. 906, 910, 421 S.E.2d 201, 205 

(1992) (citation omitted). 

 It is well established that "[t]he province of [statutory] 
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construction lies wholly within the domain of ambiguity, and that 

which is plain needs no interpretation." Winston v. City of 

Richmond, 196 Va. 403, 408, 83 S.E.2d 728, 731 (1954). "Words are 

ambiguous if they admit to 'being understood in more than one 

way[,]' refer to 'two or more things simultaneously[,]' are 

'difficult to comprehend,' 'of doubtful import,' or lack 'clearness 

and definiteness.'" Diggs v. Commonwealth, 6 Va. App. 300, 301-02, 

369 S.E.2d 199, 200 (1988) (quoting Brown v. Lukhard, 229 Va. 316, 

321, 330 S.E.2d 84, 87 (1985)). If "the words of [a] statute are 

clear and unambiguous," we "give them their plain meaning," and the 

"general rules of statutory construction" are unnecessary.2

 Diggs, 

6 Va. App. at 302, 369 S.E.2d at 200; see May Bros., 11 Va. App. at 

118, 396 S.E.2d at 696. The judiciary may not "change or amend 

[legislative] enactments under the guise of construing them." 

Winston, 196 Va. at 407-08, 83 S.E.2d at 731. 

 Here, we find nothing complex or unclear in the term "good 

cause" as it relates to termination of a distribution agreement 

under the Act. Considered together and in proper context, the 

words simply mean a "well-founded" "reason." Webster's Ninth New 

Collegiate Dictionary 527, 217 (1989). This very ordinary 

definition of plain words, used nontechnically, comports perfectly 

with a statutory scheme intended at once to protect wholesalers 

from "unfair treatment . . . by wineries" and "promote . . . fair 

 

 2

The doctrine of ejusdem generis relied upon by the Board and 

wholesalers is a rule of statutory construction unnecessary to 

ascertain clear legislative intent. 
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business relations between . . . wholesalers and wineries, and 

. . . the continuation of . . . wholesalerships on a fair basis." 

Code § 4.1-400. In the event of dispute, the Board has statutory 

responsibility to "determine if there is good cause" to terminate 

in such instance, with the burden of proof on the winery. Code 

§ 4.1-407. 

 Contrary to wholesalers' contention, the statutory references 

to circumstances which expressly do or do not constitute the 

contemplated "good cause" introduce no ambiguity to the analysis. 

Rather, the legislature simply elected to specifically exclude "the 

sale or purchase of a winery" from the broad sweep of "good cause" 

and to include certain specific instances of wholesaler deficiency. 

 These express inclusions and exclusions embrace diverse and 

unrelated circumstances and clearly impose no limitation on one 

another or any unmentioned good causes for termination under the 

Act. 

 Accordingly, we concur with the trial court that the Board 

erroneously restricted statutory "good cause" to instances of 

wholesaler deficiency. However, mindful that the Act reserves a 

determination of disputed good cause to the Board, we remand these 

proceedings to it for reconsideration of that issue consistent with 

this opinion.3

 See Virginia Supermarkets v. George, 18 Va. App. 

452, 453, 445 S.E.2d 156, 157 (1994). 

 

 3A determination of good cause and related analysis must 

address the stipulated facts specific to this case. 

 Reversed and remanded.