Opinion ID: 2603483
Heading Depth: 1
Heading Rank: 2

Heading: the board acted within its authority

Text: [3] An agency's rules must be encompassed within its statutory framework. Anderson, Leech & Morse, Inc. v. State Liquor Control Bd., 89 Wn.2d 688, 694, 575 P.2d 221 (1978). Rules and regulations enacted by an agency are presumed valid and will be upheld if reasonably consistent with the statutes they implement. Brannan v. Department of Labor & Indus., 104 Wn.2d 55, 60, 700 P.2d 1139 (1985). [R]egulation[s] will not be struck down unless `compelling reasons are presented sufficient to show the scheme is in conflict with the intent and purpose of the legislation.' Anderson, at 695 (quoting Weyerhaeuser Co. v. Department of Ecology, 86 Wn.2d 310, 317, 545 P.2d 5 (1976)). After the repeal of prohibition by the Twenty-First Amendment the original authority for the selling of alcohol in the state of Washington came from the Steele Act passed in the 1933 Extraordinary Session. The Steele Act created the Liquor Control Board. See RCW 66.08. The Steele Act granted the Board the power necessary to maintain strict monopoly control over the sale of alcoholic beverages. In the interest of public health, safety and morals, the Board possesse[s] the constitutional and statutory power to control and regulate the dispensation of alcoholic beverages. Quan, at 379. State ex rel. Shannon v. Sponburgh, 66 Wn.2d 135, 401 P.2d 635 (1965);  U Dist. Bldg. Corp. v. O'Connell, 63 Wn.2d 756, 388 P.2d 922 (1964); Derby Club, Inc. v. Becket, 41 Wn.2d 869, 252 P.2d 259 (1953); Ajax v. Gregory, 177 Wash. 465, 32 P.2d 560 (1934). The Steele Act did not allow restaurants to serve liquor by the drink. Laws of 1933, 1st Ex. Sess., ch. 62. Washington State voters passed Initiative 171 on November 2, 1948, creating the class H liquor by the drink license. Randles v. State Liquor Control Bd., 33 Wn.2d 688, 206 P.2d 1209, 9 A.L.R.2d 531 (1949) upheld the constitutionality of Initiative 171 stating at page 694: There is no natural or constitutional right to sell or engage in the business of selling or dispensing intoxicating liquor. The state, under its police power, may prohibit entirely the carrying on of such business and may regulate it in such a manner as may be deemed advisable. The times when, the places where, and the persons to whom it may be sold, may be determined by the state. The privilege of dispensing intoxicating liquor may be given to some and denied to others. [4] The rules of statutory construction apply to initiatives as well as to legislative enactments. Department of Rev. v. Hoppe, 82 Wn.2d 549, 552, 512 P.2d 1094 (1973). The collective intent of the people is to be ascertained when construing a law adopted by the vote of the people. Hoppe, at 552; E. Crawford, The Construction of Statutes § 365, at 745 (1940). To ascertain the collective purpose and intent of the people, material in the official voters' pamphlet may be considered. Hoppe, at 552; Bayha v. PUD 1, 2 Wn.2d 85, 98, 97 P.2d 614 (1939) (arguments made in pamphlets for and against an initiative measure might be considered by the court in determining the purpose and intent of the act). In the 1948 Voters Pamphlet, Initiative 171 contained the following ballot title: AN ACT providing for the regulation and control of the sale of intoxicating liquor by the drink; restricting licenses to restaurants, hotels, clubs, certain places on trains, boats and airplanes, and qualified tourist establishments; limiting such licenses to one for each fifteen hundred (1500) of population; prescribing license fees up to one thousand dollars ($1,000) per annum and surety bond of ten thousand dollars ($10,000) for payment of penalties; providing terms of office for liquor board members, with removal for cause only; distributing such license fees to the State College and University for medical and biological research; defining terms and repealing conflicting acts. Initiative 171 did not intend to turn restaurants into drinking establishments, but to permit drinks to be served incidental to food service. The Board's responsibilities include insuring that restaurants are maintained as restaurants. Initiative 171 gave the Board the same authority to make rules with regard to class H licenses as the Board previously possessed with regard to other classes of licenses. Section 15 of the initiative (now codified as RCW 66.98.070) contained a specific delegation of authority to the Board to make rules for the purpose of carrying into effect the provisions of Initiative 171. This granted the Board the same power to make regulations pertaining to the conduct of class H license holders as the Board had in relation to other license holders under RCW 66.08.030. Initiative 171 did not provide for the class H licensing of all restaurants. See RCW 66.24.420(2)-(5). Further, RCW 66.24.400 reads: There shall be a retailer's license, to be known and designated as class H license, to sell spirituous liquor by the individual glass, beer, and wine, at retail, for consumption on the premises, including mixed drinks and cocktails compounded or mixed on the premises only: ... Such class H license may be issued only to bona fide restaurants, hotels and clubs, and to dining, club and buffet cars on passenger trains, and to dining places on passenger boats and airplanes, and to dining places at publicly owned civic centers with facilities for sports, entertainment, and conventions, and to such other establishments operated and maintained primarily for the benefit of tourists, vacationers and travelers as the board shall determine are qualified to have, and in the discretion of the board should have, a class H license under the provisions and limitations of this title. Restaurant is defined by RCW 66.24.410(2) which reads: Restaurant as used in RCW 66.24.400 to 66.24.450, inclusive, means an establishment provided with special space and accommodations where, in consideration of payment, food, without lodgings, is habitually furnished to the public, not including drug stores and soda fountains: Provided, That such establishments shall be approved by the board and that the board shall be satisfied that such establishment is maintained in a substantial manner as a place for preparing, cooking and serving of complete meals. The service of only fry orders or such food and victuals as sandwiches, hamburgers, or salads shall not be deemed in compliance with this definition. (Italics ours.) [5] Hi-Starr argues that the statutory omission of a food/liquor ratio in RCW 66.24.410(2) prohibits the Board from using such a standard because a fundamental rule of statutory construction is that the expression of one item mandates the rejection of matters omitted. General Tel. Co. v. Utilities & Transp. Comm'n, 104 Wn.2d 460, 470, 706 P.2d 625 (1985). We disagree. A food/liquor ratio is not prohibited by RCW 66.24.410(2). Administrative agencies necessarily adopt rules to fill in the interstices of statutes. Further, the authority of the Board to differentiate between food serving establishments that would and would not be eligible for class H licenses was noted in Randles, at 698, stating: The appellants claim that initiative 171 discriminates in favor of the operator of a restaurant as that term is defined and limited therein, in that the operator of what is referred to as a short order restaurant is not eligible to secure a class H license. Again bearing in mind the plenary power of the state over the dispensing of intoxicating liquor and its authority to make such classifications as it deems proper as to the places where such intoxicating liquors may be dispensed and consumed, we are of the opinion that the distinction made in the definition of the term restaurant is one the lawmakers might lawfully draw. The decision to issue a class H liquor license is discretionary with the Board. See RCW 66.24.010(2) and .420. The Board cannot adopt rules which are contrary to statutory authority. We hold the provisions of WAC 314-16-190(4) and (5) come within the statutory authority granted to the Board. WAC 314-16-190(4) spells out the requirements for obtaining Board approval pursuant to RCW 66.24.410(2). WAC 314-16-190(4) and (5) implement, and do not change, the requirements of RCW 66.24.410(2). Van Ripper v. State Liquor Control Comm'n, 228 Or. 581, 365 P.2d 109 (1961) upheld the use of a food/liquor ratio noting that the then Washington 50 percent food requirement was considered by the Commission prior to the adoption of the Oregon food/liquor ratio. The Oregon Supreme Court held that the Commission had extensive power to promulgate rules and regulations regarding the sale of alcoholic beverages in food establishments and that while the Commission could not act contrary to statute it could fill in gaps in legislation to accomplish statutory purposes. Pursuant to RCW 66.24.410(2) the Board is charged with requiring that restaurants be maintained in a substantial manner as a place for preparing, cooking and serving of complete meals. WAC 314-16-190(4) and (5) provide a means by which a class H license holder can satisfy the Board that it does meet the statutory definition of restaurant. These rules are reasonably consistent with and implement RCW 66.24.410(2). No compelling reasons were presented which show that WAC 314-16-190(4) and (5) conflict with the intent and purpose of Initiative 171 and RCW 66.24.410(2). The requirements of Brannan and Anderson are met. The Legislature's grant of broad authority to the Board is not an impermissible delegation.