Court Opinion

ID: 4127110
Source: CourtListenerOpinion
Date Created: 2017-02-17 16:07:44.895169+00
Date Added: 2024-06-11T13:03:07.909547
License: Public Domain

The Board of Liquor License Commissioners for Baltimore City v. Steven Kougl, et al.,
No. 43, September Term, 2016, Opinion by Adkins, J.

ADMINISTRATIVE LAW — LIQUOR BOARD REGULATIONS — STRICT
LIABILITY OFFENSES: The Rules and Regulations for the Board of Liquor License
Commissioners for Baltimore City impose strict liability on licensees for conduct violating
Rules 4.17(a) and (b), which regulate sexual conduct and obscenity on a licensee’s
premises, and Rule 4.18, which prohibits illegal activity on a licensee’s premises.
Circuit Court for Baltimore City
Case No.: 24-C-14-004279
Argued: December 6, 2016

                                        IN THE COURT OF APPEALS

                                             OF MARYLAND

                                                  No. 43

                                           September Term, 2016

                                     THE BOARD OF LIQUOR LICENSE
                                   COMMISSIONERS FOR BALTIMORE CITY

                                                     v.

                                          STEVEN KOUGL, et al.

                                            Barbera, C.J.
                                            Greene
                                            Adkins
                                            McDonald
                                            Hotten
                                            Getty
                                            Raker, Irma S. (Senior Judge,
                                            Specially Assigned),

                                                  JJ.

                                           Opinion by Adkins, J.

                                            Filed: February 17, 2017
       The Board of Liquor License Commissioners for Baltimore City (“the Liquor

Board”) charged Respondent Steven Kougl and his company, Kougl, Inc., with violating

provisions of the Rules and Regulations for the Board of Liquor License Commissioners

for Baltimore City (“the Liquor Board Rules” or “the Rules”) that regulate sexual conduct

and prohibit illegal activity on a licensee’s premises. The Liquor Board found that Kougl

violated these Rules and ordered a 30-day suspension of his liquor license. Kougl argues

that the Rules require actual or constructive knowledge on the part of the licensee, and,

therefore, he did not violate them when his employee solicited prostitution and exposed

her breasts without his knowledge. We hold that the Liquor Board Rules at issue impose

strict liability on licensees for prohibited conduct that occurs on their premises.

                        FACTS AND LEGAL PROCEEDINGS

       In April 2013, Detective Fletcher Jackson of the Baltimore City Police

Department’s Special Enforcement Section, Vice Division, conducted an undercover

investigation at Club Harem (“the Club”), an adult entertainment establishment1 owned by

Respondent Steven Kougl.2 During his investigation, one of the Club’s employees,

Jamaica Brickhouse, approached Detective Jackson and engaged him in conversation.

After introducing herself, Brickhouse exposed her breasts to Detective Jackson and invited

       1
          We use the term “adult entertainment establishment” for description only.
Whether Kougl held an adult entertainment license at the time of the violations is not at
issue in this case.
       2
        Steven Kougl owns Kougl, Inc., also a party to this action, which does business
under the Club Harem name. Both Kougl and Kougl, Inc. are licensed by the Board of
Liquor License Commissioners for Baltimore City (“the Liquor Board”). As used in this
opinion, “Kougl” refers to both Steven Kougl and his company, Kougl, Inc.
him to touch them. He complied. Detective Jackson then asked Brickhouse if her breasts

“tast[ed] as good as they look[ed].” At this point, Brickhouse proposed a lap dance or

going to “the VIP” where they could “do whatever” so he could “find out.” Detective

Jackson asked if “whatever” meant sexual intercourse, and Brickhouse confirmed that it

did. She also clarified that it would cost $170 for the VIP room plus a tip for her services.

Detective Jackson offered a $100 tip, and Brickhouse accepted. But no money was

exchanged because Brickhouse went on stage to perform and Detective Jackson left the

Club. She was charged with prostitution about eight months later.3

       In July 2014, approximately 15 months after the incident, the Liquor Board charged

Kougl with violations of three Liquor Board Rules. Specifically, it charged him with

violations of: (1) Rule 4.17(a), which prohibits the solicitation of prostitution on a

licensee’s premises; (2) Rule 4.17(b), which prohibits indecent exposure on a licensee’s

premises; and (3) Rule 4.18, which prohibits the violation of federal, state, and local laws

on a licensee’s premises.4 After a hearing on July 17, 2014, the Liquor Board found that

Kougl violated all three Rules and imposed a 30-day suspension of his liquor license.5

       3
           The State nolle prossed these charges on January 6, 2014.
       4
         At this time, the Liquor Board also charged Kougl with a violation of Rule 4.17(a)
of the Rules and Regulations for the Board of Liquor License Commissioners for Baltimore
City (“the Liquor Board Rules” or “the Rules”) for an incident that occurred on November
11, 2013. At the July 2014 hearing, however, the Liquor Board declined to pursue this
charge.
       5
        For each of the charges, Kougl was found guilty by a 2-1 vote. The Liquor Board’s
then-Chairman Thomas Ward and Commissioner Harvey E. Jones voted guilty on all three
charges. Commissioner Dana P. Moore voted not guilty.

                                              2
Kougl petitioned for judicial review of the decision in the Circuit Court for Baltimore City.

The Circuit Court affirmed.

       Kougl appealed to the Court of Special Appeals. He argued that because he had no

knowledge of Brickhouse’s prohibited activity, he had not violated Rules 4.17(a), 4.17(b),

or 4.18.6 He claimed that the Rules do not impose strict liability. In a published opinion,

the court reversed. It held that the plain meaning of the words “suffer,” “permit,” and

“allow,” as used in Rules 4.17 and 4.18 “necessarily require that some level of knowledge

by the licensee must be established by the evidence.” Kougl v. Bd. of Liquor License

Comm’rs for Balt. City, 228 Md. App. 314, 330 (2016) (citation and internal quotation

marks omitted). The court further held that this knowledge requirement may be satisfied

by evidence of actual or constructive knowledge. Id. at 331. In defining actual knowledge,

the intermediate appellate court explained that there are two types: (1) “actual awareness

or an actual belief that a fact exists” and (2) “deliberate ignorance” or “willful blindness.”

Id. (citation omitted). Because there was no evidence of Kougl’s actual or constructive

knowledge of Brickhouse’s conduct, the court concluded that the Liquor Board erred in

finding him guilty of violating the Rules at issue.

       The Liquor Board noted a timely appeal. We granted certiorari to consider the

following question:

       6
        Kougl also argued that the Liquor Board’s decision was not supported by sufficient
findings of fact and conclusions of law to permit judicial review. Kougl v. Bd. of Liquor
License Comm’rs for Balt. City, 228 Md. App. 314, 320 (2016). The Court of Special
Appeals disagreed. Id. at 324. Neither party has appealed this portion of the court’s
decision.

                                              3
              Did the Liquor Board correctly interpret its [R]ules to impose
              upon licensees strict liability for sexual display, performance,
              or illegal activity conducted on licensed premises, where the
              pertinent portions of the [R]ules contain no language limiting
              a licensee’s responsibility to situations where the licensee has
              actual or constructive knowledge of the offending conduct?

       Because we answer this question in the affirmative, we shall reverse the judgment

of the Court of Special Appeals.

                               STANDARD OF REVIEW

       By statute, the General Assembly authorized local liquor boards to promulgate

regulations advancing Maryland Code (1957, 2016 Repl. Vol.), § 1-201 of the Alcoholic

Beverages Article (“AB”), which aims “[t]o obtain respect and obedience to law and to

foster and promote temperance” in furtherance of “the protection, health, welfare, and

safety of the people of the State.” AB § 1-201(a)(1)(i)–(ii), (a)(3). The statute specifically

authorizes the Liquor Board to “adopt regulations to carry out this article.” Md. Code

(1957, 2016 Repl. Vol.), AB § 12-210(a). In 1998, the Liquor Board promulgated revised

Liquor Board Rules. We are tasked with reviewing its interpretation of these regulations.

       In Maryland, judicial review of an administrative agency action “is limited to

determining if there is substantial evidence in the record as a whole to support the agency’s

findings and conclusions, and to determine if the administrative decision is premised upon

an erroneous conclusion of law.” United Parcel Serv., Inc. v. People’s Counsel for Balt.

Cty., 336 Md. 569, 577 (1994). Although judicial review of an agency’s factual findings

is “quite narrow,” “it is always within our prerogative to determine whether an agency’s

conclusions of law are correct.” Adventist Health Care, Inc. v. Md. Health Care Comm’n,

                                              4
392 Md. 103, 120–21 (2006) (citations and internal quotation marks omitted). If an

agency’s conclusion is based on an error of law, it will not be upheld. Hoyle v. Bd. of

Liquor License Comm’rs for Balt. City, 115 Md. App. 124, 129 (1997).

       But “[e]ven with regard to some legal issues, a degree of deference should often be

accorded the position of the administrative agency.” Finucan v. Md. Bd. of Physician

Quality Assurance, 380 Md. 577, 590 (2004) (citation omitted). Appellate courts should

ordinarily give “considerable weight” to “an administrative agency’s interpretation and

application of the statute which the agency administers.” Md. Aviation Admin. v. Noland,

386 Md. 556, 572 (2005). In this regard, “the expertise of the agency in its own field of

endeavor is entitled to judicial respect.” Finucan, 380 Md. at 590 (citations omitted). An

agency is granted further deference when it interprets a regulation it promulgated, rather

than a statute enacted by the Legislature. Md. Comm’n on Human Relations v. Bethlehem

Steel Corp., 295 Md. 586, 593 (1983). “Because an agency is best able to discern its intent

in promulgating a regulation, the agency’s expertise is more pertinent to the interpretation

of an agency’s rule than to the interpretation of its governing statute.” Id.

                                       DISCUSSION

       The Liquor Board argues that Liquor Board Rules 4.17(a), 4.17(b), and 4.18 impose

strict liability on licensees for violations that occur on licensed premises. Therefore, it

maintains, Kougl violated the Rules regardless of whether he had actual or constructive

knowledge of his employee’s conduct. The Liquor Board contends that the plain language

meaning of “permit,” “suffer,” and “allow” do not require knowledge. Furthermore, the

Liquor Board argues that the use of “knowingly” in only one provision of the Rules shows

                                              5
that it did not intend to impose a knowledge requirement in the other provisions. Lastly,

the Liquor Board urges us to apply the three-factor test from Dawkins v. State, 313 Md.

638 (1988), to conclude that because the Liquor Board did not designate a mental state

requirement in the language of the Rules, they impose strict liability.

       Kougl contends that a licensee must have actual or constructive knowledge of the

conduct at issue to violate the Rules. In other words, he maintains that the Rules require

the Liquor Board to show that the licensee either knew or reasonably should have known

about the goings-on to breach the regulations. He argues that the words “permit,” “suffer,”

and “allow” require a licensee to have knowledge of the offending conduct. Thus, he

contends, the Liquor Board was required to show that he knew or should have known about

his employee’s actions to find a violation of the Rules and suspend his liquor license.7

                                Plain Language Meaning

       Although we accord an agency considerable deference in interpreting its own

regulations, we review its conclusions of law for error by applying our well-settled

principles of statutory interpretation. Hranicka v. Chesapeake Surgical, Ltd., 443 Md. 289,

297–98 (2015) (citation omitted). Therefore, we begin by analyzing whether the plain

language of the Rules supports imposing strict liability. Like a statute, a regulation’s plain

       7
          During oral argument, through counsel, Kougl also argued that only statutes and
regulations concerning minors, such as the Liquor Board Rule at issue in Hoyle v. Board
of Liquor License Commissioners for Baltimore City, 115 Md. App. 124 (1997), impose
strict liability. We have acknowledged that “[l]egislators generally have broader discretion
in enacting laws to promote the health and welfare of children than they have for adults.”
Owens v. State, 352 Md. 663, 681 (1999). But we have never held that strict liability
applies only to regulations seeking to protect minors, and we decline to do so here.

                                              6
language is “the best evidence of its own meaning.” Total Audio-Visual Sys., Inc. v. Dep’t

of Labor, Licensing & Regulation, 360 Md. 387, 395 (2000) (citations omitted). When

interpreting the regulation, “it is proper to consult a dictionary or dictionaries for a term’s

ordinary and popular meaning.” Chow v. State, 393 Md. 431, 445 (2006) (citations

omitted). “[W]hen the language is clear and unambiguous, our inquiry ordinarily ends

there.” Christopher v. Montgomery Cty. Dep’t of Health & Human Servs., 381 Md. 188,

209 (2004) (alteration in original) (citation omitted). We conduct this plain language

inquiry within the context of the regulatory scheme, and “our approach is a

commonsensical one designed to effectuate the purpose, aim, or policy of the enacting

body.” Id. (citation and internal quotation marks omitted).

       Liquor Board Rule 4.17 governs sexual conduct and obscenity on licensed

premises.8 Sections (a) and (b) of the Rule provide:

                      (a) No licensee shall permit or suffer his premises to be
              used for the purpose of any sexual activity, nor shall any
              licensee permit or suffer any employee, patron or frequenter
              to solicit any person for prostitution or other immoral purposes.

       8
         Effective January 1, 2016, Rule 4.17 was revised and renumbered. Sections (a)
and (b) of the current version, now numbered Rule 4.15, provide:

                     (a) A licensee may not permit the licensed premises to
              be used for any sexual activity. A licensee, any employee,
              patron or frequenter may not solicit any person for prostitution
              or other immoral purposes.

                    (b) A licensee may not permit a person to appear in an
              act or other performance with breasts or the lower torso
              uncovered. A licensee may not knowingly permit the licensed
              premises to be used for the conduct, exhibition, or any
              unlawful performance.

                                              7
                     (b) No licensee shall permit or suffer any person to
              appear in any act or other performance with breasts or the
              lower torso uncovered; nor shall any licensee knowingly
              permit or suffer his premises to be used for the conduct,
              exhibition or performance of an obscene act or other
              performance.

(Emphasis added.) The Liquor Board found that Kougl “permit[ted] or suffer[ed] [an]

employee . . . to solicit [a] person for prostitution” in violation of Rule 4.17(a). It also

found that Kougl “permit[ted] or suffer[ed] [a] person to appear in [an] act or other

performance with breasts . . . uncovered” in violation of Rule 4.17(b).9 Kougl argues that

because he was not aware of his employee’s conduct, he did not “permit” or “suffer” her

actions. In other words, he contends that Rule 4.17 includes an actual or constructive

knowledge requirement. We disagree.

       Black’s Law Dictionary (Black’s) provides three definitions for “permit”: (1) “[t]o

consent to formally”; (2) “[t]o give opportunity for”; and (3) “[t]o allow or admit of.”

Permit, Black’s Law Dictionary (10th ed. 2014). To consent to something formally, the

actor certainly must know about the approved activity. But the second definition—“[t]o

give opportunity for”—does not require the actor’s knowledge of the conduct at issue.

Black’s provides as an example, “[L]ax security permitted the escape.” Just as lax security

could permit an escape without knowledge that it is happening, licensees can permit

prohibited conduct without knowledge of the offending behavior. Similarly, the third

       9
        The Liquor Board maintains that Kougl’s employee appeared in a “performance”
under Rule 4.17(b) when she exposed her breasts to Detective Jackson. Kougl does not
challenge this interpretation of the Rule.

                                             8
definition does not require knowledge on the part of the actor because, as discussed below,

a licensee can “allow” prohibited conduct without knowledge that it is occurring.

       To choose the appropriate definition, we look to the agency’s interpretation of its

own regulation. Md. Transp. Auth. v. King, 369 Md. 274, 288–89 (2002) (citations

omitted). We give deference to an agency’s interpretation “unless it is plainly erroneous

or inconsistent with the regulation.” Id. (citations and internal quotation marks omitted);

see also Md. Comm’n on Human Relations, 295 Md. at 593 (“the agency’s construction of

its rule is entitled to weight”). Because neither is the case here, we hold that a licensee can

unknowingly “permit” conduct prohibited by Rules 4.17(a) and (b).

       Black’s defines “suffer” as “[t]o allow or permit (an act, etc.).” Suffer, Black’s Law

Dictionary. As established above, “permit” does not require knowledge, and—as discussed

below—neither does “allow.” Black’s provides “to suffer a default” as an example of how

“suffer” is used. Id. A loan enters default when the borrower fails to make payments,

regardless of whether the borrower was aware of the obligation to pay. Accordingly, by its

plain meaning, “suffer” does not impose a knowledge requirement on Rules 4.17(a) or (b).

       Moreover, other states interpreting the words “permit” and “suffer” in liquor board

regulations have concluded that they impose strict liability. See, e.g., Div. of Alcoholic

Beverage Control v. Maynards Inc., 927 A.2d 525, 538 (N.J. 2007) (“It has long been the

law in New Jersey that, in the context of the regulation of alcoholic beverages, the word

suffer . . . imposes responsibility on a licensee, regardless of knowledge . . . .” (emphasis

in original) (citation and internal quotation marks omitted)); City of West Allis v. Megna,

133 N.W.2d 252, 253 (Wis. 1965) (regulation that provide[d] “no keeper of a tavern . . .

                                              9
shall . . . suffer or permit” anyone under 21 to enter the licensed premises impose[d] strict

liability).10

        The Liquor Board found that Kougl also violated Rule 4.18, which prohibits illegal

conduct on a licensee’s premises.11 The Rule provides:

                       No licensee shall commit or allow the commission on
                his premises of any act which shall be contrary to any federal,
                state or local statute, law or ordinance or against the public
                peace, safety, health, welfare, quiet or morals.

(Emphasis added.) Similar to his argument regarding Rules 4.17(a) and (b), Kougl argues

that “allow” requires actual or constructive knowledge. The plain meaning of the word

proves otherwise. The first definition in Black’s for “allow” includes “[t]o put no obstacle

in the way of” and “to suffer to exist or occur.” Allow, Black’s Law Dictionary. These

definitions do not contain a knowledge requirement. A licensee could both “put no obstacle

in the way of” illegal conduct and not realize it is happening.

        10
          We are aware that some courts have found that “suffer” and “permit” require
knowledge on the part of the licensee. See, e.g., Leake v. Sarafan, 315 N.E.2d 796, 797
(N.Y. 1974) (knowledge required to find that licensee suffered or permitted gambling on
licensed premises); Full Moon Saloon, Inc. v. City of Loveland, 111 P.3d 568, 570 (Colo.
App. 2005) (“The word ‘permit’ connotes affirmative or knowing conduct.”). We disagree
with these courts.
        11
        Effective January 1, 2016, Rule 4.18 was revised and renumbered. The current
Rule, which is now numbered Rule 4.16, provides:

                        A licensee may not commit or allow the commission on
                the licensed premises of an act that is contrary to any federal,
                State or local statute, law or ordinance or that is against the
                public peace, safety, health, welfare, quiet, or morals.

                                              10
       Black’s also defines “allow” as “[t]o give consent to; to approve” and “[t]o grant

permission,” which require the actor’s knowledge. But, as discussed above, our task is not

to determine whether any possible definition includes a knowledge requirement. Rather,

it is to determine whether the Liquor Board’s interpretation of its Rules is legally correct.

See Adventist Health Care, 392 Md. at 120–21 (citations omitted) (Courts review an

agency’s conclusions of law de novo.). Because an accepted definition of “allow” does not

require knowledge—and we grant the Liquor Board’s interpretation some deference—we

hold that Rule 4.18 imposes strict liability.

       The Liquor Board also argues that in the absence of other language designating a

mental state requirement, the use of the term “knowingly” in the second part of Rule

4.17(b) suggests the agency intended those Rules that do not include the term to impose

strict liability. In response, Kougl contends that “knowingly” was included in the second

phrase of 4.17(b) by “happenstance.” We agree with the Liquor Board.

       The Court of Special Appeals analyzed a Liquor Board Rule with a similar structure

to Rule 4.17(b) in Hoyle v. Board of Liquor License Commissioners for Baltimore City,

115 Md. App. 124 (1997). It concluded that the Liquor Board Rule prohibiting the sale of

alcohol to minors imposed strict liability on licensees. Id. at 130. Rule 4.01(a) provided:

                     (a) No licensee shall sell or furnish alcoholic beverages
              to any person under twenty-one (21) years of age or to any
              person with the knowledge that such person is purchasing or
              acquiring such beverages for consumption by any person under
              twenty-one (21) years of age.

(Emphasis added.) Comparing the Rule’s two phrases, the court explained that as opposed

to the second phrase—the prohibition on selling alcohol to someone buying it for a minor—

                                                11
the first phrase—the prohibition on selling alcohol to anyone under twenty-one—“stands

alone, unmodified by express terms.” Id. at 130. Emphasizing that the agency interpreted

this regulation to impose strict liability, the court concluded that “the intent of the [Liquor]

Board was to make those licensees who furnish alcoholic beverages to anyone under the

age of twenty-one strictly liable for the offense.” Id.

       Additionally, in State of Maryland Central Collection Unit v. Jordan, 405 Md. 420

(2008), we held that a statute requiring vehicle owners to maintain car insurance imposed

strict liability due, in part, to the Legislature’s use of “knowingly” elsewhere in the

statutory scheme. Id. at 431–32. The statute at issue was “silent as to whether knowledge

or intent is a required element for a violation thereof.”         Id. at 430.    Although we

acknowledged that the “absence of such language in a statute . . . does not necessarily make

it a strict liability offense,” we reasoned that because the Legislature articulated a mental

state requirement for other provisions within the statutory scheme, it intentionally omitted

one from the provision at issue. Id. at 430–32 (citing Staples v. United States, 511 U.S.

600, 619 (1994)) (additional citations omitted).          We explained, “The Legislature’s

omission of a mens rea requirement in [this provision] . . . leads us to conclude that the

Legislature deliberately chose not to make knowledge an element of the offense of

maintaining the required security on an automobile.” Id. at 431–32; see also Outmezguine

v. State, 335 Md. 20, 43 (1994) (When the surrounding provisions contained a knowledge

requirement, the “conspicuous absence” of such a requirement in the offense of

photographing a minor engaged in sexual activity revealed an intent to impose strict

liability.); Garnett v. State, 332 Md. 571, 585–86 (1993) (Omitting “knows or should

                                              12
reasonably know” from the statutory rape provision, but including it in surrounding

provisions, “indicates that the Legislature aimed to make statutory rape with underage

persons a more severe prohibition based on strict criminal liability.”).

       When interpreting a regulation, we must read each provision in the context of the

regulatory scheme to ensure that “no word, clause, sentence, or phrase is rendered

surplusage, superfluous, meaningless, or nugatory.” In re Kaela C., 394 Md. 432, 467

(2006) (citation omitted). An interpretation of the Rules that requires the licensee to act

with actual or constructive knowledge would render superfluous the word “knowingly” in

Rule 4.17(b). Thus, we conclude that Rules 4.17(a), 4.17(b), and 4.18 do not include a

knowledge requirement—they impose strict liability.

       The plain language meaning of the Rules comports with the purpose of Maryland’s

liquor regulations, which seek to ensure respect and obedience for the law. AB § 1-

201(a)(1)(i). Additionally, a liquor license is a privilege, and the Liquor Board has the

power to circumscribe that privilege as “deemed necessary to prevent [its] abuse.”

Piscatelli v. Bd. of Liquor License Comm’rs, 378 Md. 623, 639 (2003) (quoting Dundalk

Liquor Co. v. Tawes, 201 Md. 58, 65 (1953)); AB § 12-2101(a). We agree with the New

Jersey Supreme Court that “acceptance of the privileges and benefits of a liquor license in

this State carries with it the burden that licensees are held to an exacting standard of

conduct.” Maynards, 927 A.2d at 539. Moreover, as the Wisconsin Supreme Court has

recognized, being subject to strict liability is “a price that the [licensee] pays for the

privilege of becoming licensed.” City of West Allis, 133 N.W.2d at 254.

                                             13
                                     Dawkins Factors

       In addition to its plain meaning arguments, the Liquor Board contends that the Rules

are “public welfare offenses” under the three-factor analysis applied in Dawkins v. State,

313 Md. 638 (1988). Thus, it argues, the Rules appropriately impose strict liability on

licensees to further their regulatory purpose.     In response, Kougl points to State v.

McCallum, 321 Md. 451 (1991), where this Court held that a criminal statute prohibiting

driving on a suspended license did not satisfy the Dawkins factors and therefore required

actual or constructive knowledge on the part of the driver. He urges us to adopt the

definition of knowledge from Judge Chasanow’s concurring opinion, which includes

“willful blindness.”12

       In Morissette v. United States, 342 U.S. 246 (1952), the Supreme Court defined

“public welfare offenses” as “regulations which heighten the duties of those in control of

particular industries, trades, properties or activities that affect public health, safety or

welfare.” Id. at 254. It distinguished “public welfare offenses” from traditional common-

law, criminal offenses:

              These cases do not fit neatly into any of such accepted
              classifications of common-law offenses, such as those against
              the state, the person, property, or public morals. Many of these
              offenses are not in the nature of positive aggressions or
              invasions, with which the common law so often dealt, but are
              in the nature of neglect where the law requires care, or inaction

       12
           In his State v. McCallum, 321 Md. 451 (1991), concurring opinion, Judge
Chasanow explained that actual knowledge includes “deliberate ignorance” or “willful
blindness,” which “exists where a person believes that it is probable that something is a
fact, but deliberately shuts his or her eyes or avoids making reasonable inquiry with a
conscious purpose to avoid learning the truth.” Id. at 458 (Chasanow, J., concurring)
(citations omitted).

                                             14
              where it imposes a duty. Many violations of such regulations
              result in no direct or immediate injury to person or property but
              merely create the danger or probability of it which the law
              seeks to minimize.

Id. at 255–56. The Supreme Court explained that “lawmakers . . . have sought to make

such regulations more effective by invoking criminal sanctions to be applied by the familiar

technique of criminal prosecutions and convictions.” Id. at 254–55 (footnote omitted).

Furthermore, courts have allowed legislatures to forego the traditional mental state

requirement for criminal acts and impose strict liability for these offenses. Id. at 258–59.

       In Dawkins v. State, we analyzed three factors to determine whether statutes

prohibiting the possession of a controlled dangerous substance and the possession of drug

paraphernalia constituted “public welfare offenses.” We held that the statutes did not

constitute “public welfare offenses” and declined to impose strict liability. Dawkins, 313

Md. at 651–52. Relying on Morissette, we explained that strict liability “public welfare

offenses” often have the following characteristics: (1) they are “regulatory in nature”; (2)

they involve light fines or penalties; and (3) “regardless of the defendant’s state of mind,

the defendant is generally in a position to prevent the violation from occurring.” Id. at

644–45 (citing Morissette, 342 U.S. at 256) (additional citations omitted). But this three-

factor inquiry is not applicable in this case.

       Recognizing that criminal liability generally requires criminal intent, the Dawkins

Court analyzed whether it was appropriate for a criminal statute to impose strict liability.

Id. at 643 (“At common law, a crime occurred only upon the concurrence of the

individual’s act and his guilty state of mind.”). We have explained, “The requirement that

                                                 15
an accused have acted with a culpable mental state is an axiom of criminal jurisprudence.”

Garnett, 332 Md. at 578–80 (describing scholars’ rejection of strict criminal liability).

Therefore, we are “reluctant to read into criminal statutes an intent of the [L]egislature to

forego a mens rea requirement.” Owens v. State, 352 Md. 663, 671 (1999). Consequently,

we apply the Dawkins factors to criminal statutes to determine whether “the Legislature

intended to eliminate the requirement of mens rea and create a strict liability public welfare

offense.” McCallum, 321 Md. at 456; see also Lowery v. State, 430 Md. 477, 501–03

(2013) (applying Dawkins analysis to criminal prohibition on hydraulic clam dredging in

a protected area).

       Because the Liquor Board Rules are civil regulations, however, there is no

presumption against strict liability. See Mesbahi v. Md. State Bd. of Physicians, 201 Md.

App. 315, 339 (2011) (When interpreting civil regulatory statutes, “[t]he presumption

against strict liability offenses in criminal law is irrelevant.”); Council on Am.-Islamic

Relations Action Network, Inc. v. Gaubatz, 123 F. Supp. 3d 83, 87 (D.D.C. 2015) (declining

to impose criminal law’s presumption against strict liability to civil provisions of the D.C.

Wiretap Act); Long v. Hammond, 596 S.E.2d 839, 845–46 (N.C. Ct. App. 2004) (rejecting

argument that presumption against strict liability applies to civil aspect of state licensing

requirements for ERISA certified health plans). Therefore, we do not need to apply the

Dawkins analysis to determine whether the presumption has been overcome. Because we

decline to apply the Dawkins factors to the Liquor Board Rules at issue, the Court’s

reasoning in McCallum is not analogous to this case.

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                                    CONCLUSION

      Liquor Board Rules 4.17(a) and (b), and 4.18 impose strict liability on licensees for

offending conduct that occurs on their premises. Therefore, the Liquor Board was not

required to show that Kougl knew or should have known about his employee’s actions to

find a violation of the Rules and impose a sanction. Accordingly, we reverse the judgment

of the Court of Special Appeals.

                                         JUDGMENT OF THE COURT OF
                                         SPECIAL APPEALS REVERSED. COSTS
                                         TO BE PAID BY RESPONDENT.

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