### IN THE COURT OF APP EALS OF TENNESS EE AT NAS HVILLE Se pte m be r 3, 200 3 S es sio n JJ & TK CORP., ET AL 

### . v. BOA RD OF CO MM ISSION ERS OF THE C ITY

OF FAIRVI EW, T ENNESSE E, ET AL 

### . Appeal f romthe Chancer y Court for Williamson County No. 28885 R.E. Lee Davie s, Chancellor

No. M2003- 00087-COA-R 3-CV - F iled April 14, 2004

I n th is c a se thede fe nd a nt, theB oa rdof Com mis sio ne rs of

theCity of F a ir vie w, de c lin e d to g rant a certificate of

compliance to the plaintiffs, who soug ht to operate a re tail liquor store at the e ntranc e of B owie Nature Park in F airview , Tenne ssee. Theplaintiffs conten d t h ey m et all the leg al require ments in effe ct at the time of the ir application; and that the defe ndant base d its decision on a pending ordinanc e which r equire d a minimum dis tance of 1000 fe et betwe en liquor s t o res and public parks. Thetrial court g rante d summary judgme nt for the de fendant. We reve rse the de cision of the trial c ourt.

Te nn. R . A pp. P . 3 App e al; Judg m e nt of t he Cha nc e r y C our t R e ve r se d
J A M ES L. W EA T H ERFORD , S R ., J ., delivere d the opinion of the court, in which W I L L I AM B. C A IN , and P ATR I C I A J. C O T T RE LL , J J . joined.
A. Scott Derrick and Philli p P

. W el t y , Nashville, Tenne ssee, f or the a ppellants, J J & T K Corp., J oanne Mc Cord, J eff

McCord, Kristin Mathes and Tim Mathes.
J ames D. Pete rsen, Fr anklin, Tenne ssee, for the appellee s, Boa rd Of Commissioners of the City of Fairview, Te nnessee , Eddie Arney , Ken Brison, W ayne Hall, May or Darre ll Mang rum, Vice -May or Stuart J ohnson, and the City of F airview Tenne ssee.

OP IN ION Plaintiffs, J J & T K Corporation, a Tenne ssee c orporation, its share holders, off icer s and direc tors, areapplicants for a re tail liquor license to oper ate a retail liquor store within the city of Fa i rv i ew
. As p ar to f t h ei r a p p l i ca t i o n s u b m i t t ed t o t h e T en n es s ee Al co h o l i c B ev er age Commi ssion, the plaintiffs must obtain a certificate of compliance signe d by

the local g overnme ntal authorities stating that the applicant is in compli ancewith local ordinanc es. Tenn. Code Ann. § 57-3-208. Theproposed location of the plaintiffs’s liquor store w as at the e ntranc e to Bowie NaturePark in Fairview.-2-

On Novembe r 15, 2001, the F airview Be er B oard a ppointed a committee to re view the city ’s cur rent ordinance pr ohibiting the issuanceof bee r license s to establishments within 1,000 fee t of the entrance to its public park, c hurche s or other spe cified public f acilities. The liquor ordinanc e then in ef

fec t provided:
No license shall be issued to any retailer whe re the place of business of the licenseeis located within fifty y ards of a private re sidence , or is within one hundred y ards of

any churc h or two hundre d y ards of a school g round....
No license shall be issued to any retail liquor dealer w herethe placeof business of the license e is locate d within three hundre d y ards of another retail liquor store.
Fairview Municipal Code § 8- 103.
On J anuary

17, 2002, the B eer

Boa rd discussed the inc onsistency betwee n the bee r ordinanc e and the liquor ordinanceand re fer red the question to the Boa rd of Commissioners (her einaf ter the de fendant) to determine w hich ordinanc e should be amended.
On Marc h 7, 2002, the plaintiffs appe are d and re quested the de fendant to issue the certificate. The y

wer e advise d to fill out an application and to bring it to the administ rative committee meeting on Marc h 14. The de fendant adopted B ill 2002-4 on first rea ding, w hich reduc ed the distanc e re quirement for beer licenses f rom 1,000 fee t to more than 600 fe et from the park e ntranc e and r equire d liquor stores to be morethan 600 fe et from the pa rk entrance.
On Marc h 9, 2002, the plaintiffs filed an application for the ce rtificate with defe ndant. On Marc h 14, 2002, the administrative committee voted to r ecommend to the de fendant that the plaintif fs ’ a pp lic a tio n b e de nie d b e c aus e thepr op os e d lo c a tio n w a s n ot i n c omp lianc e wi th pending ordinanc e 2002-4. A t its reg ular mee ting on April 4, 2002, the defe ndant def err ed ac tion on both the plaintiffs’ ce rtificate and the pe nding or dinance until after r ece iving public input on the issue from a

public workshop sche duled for A pril 11.
At theAp ri l 18 , 2 00 2 me e tin g , th e de fe nd a nt i ntr od uc e d andpu t up fo r 1 re a din g B ill st 20 02 -6 wh ic h p ro vid e d: “ No re ta ile r’ s li c e ns e sh a ll b e iss ue d to a n a pp lic a nt w ho se loc a tio n is less than one thousand ( 1,000) fe et from a churc h, school, licensed day car e ce nter or nur sery , or public park.” The ordinance pa ssed on the first re ading . The de fendant ag ain def err ed the p l ai n t i ffs ’ a p p l i ca t i o n u n t i l t h e M ay2 , 2 0 0 2 m ee t i n g.T he m i nut es o f t he m eet i ng read as fo l l o ws: “Arney t hen m ad e a m o t i o n t o d eny t he l i q uo r ap p l i cat i o n on t he 1 bas i s t h at i t i s t oo cl os e t o a publ i c pa r k

. H al l s ec on ded t h e mot i on
. B r i s on as k ed i f t h ey s h ou l d v ot e on t h e appl i ca t i on usi ng t he o l d l i q uo r ordinance or t he new o rdinance t hey jus t ad o p t ed

. P et ers en st at ed t hat i t was at t he d i scr et i o n of t he B oard on w hi ch ordi nan ce t hey us ed. H al l s t at ed t hat wh en he was appo i nt ed i n J anu ar y , Arn ey ment i oned at t he B eer B o ard t hat t hey need ed t o m ake t he b eer and al co ho l regul at i o ns t he same. V o t e o n m o t i o n. A l l were i n f avo r of de ny i ng t he l i quor s t ore appl i cat i on. ” -3- On May 2, 2002, Bill 2002-6 passe d the 2 and fina l rea ding. O n that same nig ht the nd defe ndant unanimously

voted in favor

of a motion “to deny

the [plainti ffs’] liquor application on the basis that it was too close to a public pa rk.” 1 The plaintiffs f

iled a petition for writ of certiorari and c omplaint for dec laratory judgme nt in chanc ery

court a sking the court to find that def endant’ s action wa s arbitra ry , capricious and un re a so na

blein d e nying thec e rtif

ic a te ba se d o n a

pe nd ing or din a nc e that w a s n ot l e g a lly e ff e c tiv e on May

2, 20 02 . T he plaintif

fs c on te nd e d th a t th e or din a nc e didno t ta ke e ff e c t un til May 3, 2002, or 15 day s after

its first reading pursuant to Tenn. Code Ann. § 6-20-215. The plaintiffs filed a motion for judg ment on the pleading s and aske d the court to find that they wer e entitled to issuance of

the ce rtificate . The de fendant filed a re sponse ac companied by the May or’s a ffidavit. The defe ndant aske d for judg ment on the pleading s or in the alternative for summary judgme nt. After g iving the plaintiffs an opportunity to file aff idavits, the trial court decide d the ca se on summary judgme nt.
Th e tria l c ou rt

fo un d th a t th e de fe nd a nt h a d th e auth ority to d e ny theplaintif

fs ’ application for

a ce rtificate based upon a pending ordinanc e which took e ffe ct the following day and that the de fendant did not act arbitra rily , capriciously , or unre asonably . The trial c ourt dismiss ed the pe tition for declar atory judgme nt and g rante d the def endant’ s motion for summary judgme nt.
Th e plaintif

fs raisethefo llo wi ng iss ue :
Whe th e rth e tr ial c our t e r r e d by ho ldingth at defe ndant had the author it y t o de ny P laintif fs’ application for a cer tificate of com plian ce r equired by Tenn. Code An n. § 57- 3- 20 8 ( 20 02 ) b as e d upon a pe nding or dina nc e whic h to ok effe c t the foll owing day , a nd that in so denyin g P laintif fs a cer tificate of com plian ce, wh ether Defend a n t a cted arbitrar ily, capriciously, an d un reasonably un der the law of the Stateof T ennessee.
I n i t s memorandum opinion, the trial court stated: “Plaintiffs conce de they would have no arg ument on this issue if the City had waited twenty -four hours befor e denying their application. As such, plaintiffs’ a

rg ument amounts to elevating form over substance, w hich th i s C ourt ca nnot condone.” The trial co u rt al s o p ointed out that the conce rns about the location of beer and liquor sto re s n e ar the e ntranc e to the pa rk we rema de pu bli c mon ths be fo retheplaintif fs fi le d th e ir ap p l i ca t i o n ; an d t h e C i t y co n d u ct ed p u b l i c he ar i n gs o n t h e is s u e wh i l e t h e ap p l i ca t i o n wa s p en d i n g.T h e Fa i r v i ew Ci t y M an ag er
- Commi s s i on C h ar t er adopt s t h e t h e l an g u ag e of t h i s s t at u t e as i t s ow n § 6- 2- 215, 2

an d § 1

- 1 0 6 o f

the F airview M un i cip al C o d e a l so m an d ates thi s p ro ce d ure fo r p assa ge an d eff ec t i ve ne ss o f

o rd i na nc es. -4- Construction of a statute is a que stion of law which the a ppell at e co u rt s review de novo w ith o u t a p r e s u mp ti o n o f c o rr e c tne ss. Hill v . Ci ty of G e rm an tow n , 31 S.W .3d 234, 237 (Tenn. 2 0 0 0 ). I n i n t erpreting statutes, this court is to ascertain and g ive ef fec t to the leg islative intent without undulyrestric ting or expanding the statute’s cove rag e bey ond its intended scope

. Hathaway v. First Family Financial Servic es, Inc

. , 1 S.W .3d 634, 640 (Tenn. 1999)

. The “ [l ]egislative intent mu s t b e a s c e rtain e df

r o m th e n a tu r a l an do r d in ary me a n in g o f th e s tatu to ry lan g u a g e , ‘ r e a dinc o n te xt of the e nti re statut e , wi tho ut a ny fo rc e d or su btl e c on str uc tio n wh ic h wo uld e xten d o r l im it its m ea n i n g. ’” S ta te v . Butler , 9 80 S.W. 2d35 9, 36 2 ( Te nn . 1 99 8) ; Chr ism an v . H ill Ho me De v e lop me nt, Inc. , 978 S.W .2d 535, 540 (Tenn. 1998)

. Tennessee Code Annotated § 5 7- 3- 20 8( b) pr ov ide s inpe rtine nt p art :
Th e c e rtif ic a te mus t st a te : (2) That the applicant or

applicants ha ve s ec u re d a location for the business which complies with all restrictions of any local law, ordinance, or resolution, duly

adopted by theloc a l ju ri sd ic tio n, a s to theloc a tio n o f the bu sin e ss; (3) That the applicant or applicants have compli ed with any local law, ordinanc e or re s o l u t i o n d u l y

a d o p t e db y

t h e l o c a l au t h o r i t i e s r e g u l a t i n g t h e n u mb e r o f r e ta il licenses to be issued w ithin the jurisdiction.
Tenn. Code Ann. § 57-3-208( b)(2) -(3)

. Tennessee Code Annotated § 6 -2 0- 21 5 pr ov ide s inpe rtine nt p art :

2 (a ) Ev e ry or din a nc e sh a ll be re a d tw o (2 ) dif fe re nt day s in op e n se ssi on be fo re i ts adoption, and not less t han one ( 1) we ek shall ela pse betwe en first and second rea dings, and any

ordinanc e not so rea d shall be null and void.... (b ) A n o rd i n an ce s h al l n o tt ak e e ff ec tu n t i l fi ft e e n ( 1 5 ) d ay s af t erth e f i rs tp as s age there of, except i n ca s e of an e merg ency ordinanc e. An e merg ency ordinanc e may become eff

ective upon the day

of its final passag e; provided, that it sha ll contain the statement that an e merg ency exis ts and shall specify with distinctness the fa cts and rea sons constituti ng such an e merg ency
. Tenn. Code Ann. § 6-20-215.
The statute provides th at an o rd i n ance shall nottake e ff e c t un til 15 day s a ft e r i ts f ir st passag e. “[W] hen the word ‘shall’ is used i n statutes it is ordinarily construed a s being mandatoryP l ai nt i f f s d i d n o t cont es t t he defendan t ’ s au t hor i t y t o defer ac t i on upon t he appl i cat i on wi t hi n t he 60 day 3 lim itatio n m a n d a te d b y T e n n . C o d e A n n . 5 7 -3 -2 0 8 (e ); n o r d id the y c la im a “v e ste d rig h t” to issu a n c e o f t h e c e rtifi c a te
u n d e r p rio r o rd ina n c e b e c a u se the y fi le d the ir a p p lica tio n p rio r to the a d o p tio n o f O rd ina n c e 2 0 0 2 -6

. -5- and not discre tionary .” Gabel v. Lerm a, 812 S.W .2d 580, 582 (Tenn. Ct. App. 1990)

. Th e statut e does allow for

the adoption of an “eme rg ency ordinanc e” w hich could take eff ect in a shorter pe riod of t ime; but that provision is not applicable to this case
. The defendant passed ordinance 2002-6 on the first re ading on April 18, 2002. This ordinancedid not take ef fec t until M ay

3, 2002 or 15 day s after the first passa g e pursuant to the statute. The def endant denied the plaintiffs’ application based on or dinance 2002-6 on May 2, 2002.
Th e d e f e n d a n t c i t e s t w o z o n i n g o r d i n a n c e c a s e s a s s u p p o rtf o r d e n y i n g t h e p l a i n t if

fs ’ application base d on a pending o rd i n ance. State ex re l. SCA Chemical W aste Servs., I

nc. , v. Konisberg, 636 S.W .2d 430 (Tenn. 1982) and Sta te ex re l. Fi rst Am e ric an Ba nk v . City of Fra nk lin Mun. Planning Comm. , No. 0l-A-01- 9408-CH-00394, 1996 Te nn. App. LEXI S 175 (Tenn. Ct. App. Mar. 21, 1996) . Both of these cases invol ve the defer ral of a ction or the re fusal to g rant pe rmission by a g overnme ntal authority during the time period in w hich a new or dinance was pe nding. I n the 3 SCA Che mi c al c a se , the Te nn e sse e Sup re me Cou rt state d: “ We h oldthat th e c ou nty a c te d p ro pe rl y a n dh a dau th o r ity

to s u s p e n dth e is s u a n c e o f p e r mi ts f o r s u c h c o n s tr

uction pendi ng the eff

ective dat e of it s ne w jo int

ordi n an c e r e so lut ion
. ” SCA Chemical , 636 S.W .2d at 437. Her e the Def endant de nied the application based on the pe nding ( but as y et ineff ective) ordinance. See Cla ibo rn e Cou ntr

y Clu b v . Ci ty of T

az e we ll , 78 2 S.W .2 d 476 ( Te nn 19 90 ) ( de nial of be e r p e rm it based on or dinance reduc ing number of beer permits from 5 to 4 held i nvalid beca use ordinanc e had no t be e n pu bli sh e d in a c c or danc e wi th statut e a nd c ou rt a lso or de re d is su a nc e of

pe rm it a s a

pp lic a nts met require ments of the ef fec tive ordinanc e)
“Ge nera lly

speaking , proce eding s under an ordinanc e betwe en the date of its passag e and the date it takes e ffe ct ar e void.” 5 Eug ene Mc Qu ill in, The Law of Mu nic ipa l Co rp or ati on s § 15.39 (3 rd ed. 1996). See Fee v. Bornhorn, 251 S .W.2d 230 (Ky . 1952)(police chief appointment made by a c tin g c ity

ma na g e r s e ve ral ho ur s p ri or to e ff e c tiv e date of

re so lutio n r e mov ing inc umb e nt c ity manag er f rom offic e held invalid).
Af te r r e vie wi ng there c or d inthi s c a se , w e fi nd that the de fe nd a nt’ s a c tio n d e nying plaint if fs ’ app lic a tio n b a se d u po n th e pe nd ing or din a nc e to b e vo id. Th e plaintif fs me t a ll o f the re qu ir e me nts of theor din a nc e in ef

fe c t at the tim e of the de nial of the ir app lic a tio n. Un de r the se c ir c ums ta nc e s, the application should ha ve been g rante d as plaintiffs met all other re quirements for the ce rtificate

. The judg ment of t h e t ri al co u rtis rever sed and this ca se is remanded for the entry and enfor ceme nt of a de cre e orde ring the Cityof F airview to issue a ce rtifica t e o f compli anceto the p l a i n t i f f s
. C o s t s a

r e t a x e dt o t h e c i t y.

___________________________________ JA M E S L

. W E A T H E R F O R D , S R

. J.