Court Opinion

ID: 1067954
Source: CourtListenerOpinion
Date Created: 2013-10-09 19:28:11.84024+00
Date Added: 2024-06-11T15:23:28.524162
License: Public Domain

COURT OF APPEALS OF VIRGINIA

Present: Judges Baker, Coleman and Elder
Argued at Richmond, Virginia

VIRGINIA JOCKEY CLUB, INC.

v.        Record No. 1455-95-2                OPINION BY
                                       JUDGE SAM W. COLEMAN III
VIRGINIA RACING COMMISSION                  APRIL 16, 1996

         FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND
                    Randall G. Johnson, Judge

          Lawrence H. Framme, III, for appellant.

          Steven D. Gravely (Beverly W. Snukals; Mark B.
          Rhoads; Mezzullo & McCandlish, on brief), for
          appellee.

     Virginia Jockey Club, Inc. (appellant) appeals the trial

court's order affirming the Virginia Racing Commission's decision

awarding licenses to Colonial Downs, L.P. to own a horse

racetrack with pari-mutuel wagering, and to Stansley Racing

Corporation to operate such a track.   Appellant contends that the

trial court erred by holding that the commission did not exceed

its authority under the Virginia Pari-Mutuel Horse Racing Act

(Horse Racing Act) in awarding an owner's license to a limited

partnership, and an operator's license to a corporation that did

not file an application with the commission.   We hold that the

commission acted within the scope of its authority and affirm the

trial court's order.

     The General Assembly enacted the Horse Racing Act in 1988 to

allow horse racing with pari-mutuel betting in Virginia.   As part
of the legislation, the General Assembly created a racing

commission and vested it with "control of all horse racing with

pari-mutuel wagering in the Commonwealth, [and] with plenary

power to prescribe regulations and conditions under which such

racing and wagering shall be conducted, so as to maintain horse

racing in the Commonwealth of the highest quality and free of any

corrupt, incompetent, dishonest or unprincipled practices and to

maintain in such racing complete honesty and integrity."      Code

§ 59.1-364(A).    The Act provides that "[n]o person shall

construct, establish or own a horse racetrack or satellite

facility where pari-mutuel wagering is permitted" without

receiving an owner's license from the commission, and that "[n]o

person shall operate pari-mutuel wagering or conduct any race

meeting at which wagering is permitted" without first obtaining

an operator's license from the commission.    Code § 59.1-375.
        Pursuant to its statutory authority, the commission

established October 1, 1993, as the deadline for submitting

applications for owner's and operator's licenses, prescribed the

information to be provided in the applications, and permitted the

filing of joint applications for owner's and operator's licenses.

 See Code §§ 59.1-377, -381.    Six applicants, Virginia Racing

Associates, L.P.; Virginians, Inc.; Churchill Downs, L.P.; Old

Dominion Jockey Club, Inc.; Virginia Jockey Club, Inc.; and

Stansley Management, L.P. submitted applications by October 1,

1993.    All six applicants submitted joint applications.

                                 - 2 -
     Stansley Management, L.P. (Stansley, L.P.) stated in its

joint application that it would enter into a contract for the

management of the racing facility with an entity controlled by

Arnold Stansley.   Arnold Stansley was Stansley, L.P.'s general

partner, and was also a limited partner along with James

Leadbetter.   Stansley owned seventy percent of Stansley, L.P.,

and Leadbetter owned thirty percent.    In June 1994, Stansley,

L.P. changed its name to Colonial Downs, L.P. 1 and substituted

Stansley Management Corp. (Stansley Corp.) as its general partner

in place of Arnold Stansley.   Stansley Corp.'s only shareholders

are Stansley (70%) and Leadbetter (30%).
     In May 1994, Colonial Downs informed the commission by

letter that it would enter into a contract with Stansley Racing

Corporation (Stansley Racing), a Virginia stock corporation to be

formed, to operate and manage the racing facility if it received

the owner's license.   Stansley Racing was incorporated in June

1994, and its sole shareholders are Arnold Stansley (70%) and

James Leadbetter (30%).    Stansley and Leadbetter are also

Stansley Racing's sole directors, and Arnold Stansley is the

corporation's President.

     As part of the application process, all six applicants

provided financial data and analyses, engineering studies,

architectural renderings, case studies, and demographic analyses

     1
      Hereinafter, reference to Colonial Downs shall also include
all references to Stansley, L.P.

                                - 3 -
in support of their different approaches for establishing a horse

racing facility.   The commission held several meetings and public

hearings, and inspected each of the sites proposed by the six

applicants.   In addition, the commission received analyses of the

applications from two expert consultants and afforded the

applicants the opportunity to review those analyses and question

the consultants' representatives.   The commission also conducted

background investigations of all persons having an ownership

interest in the three corporations and three partnerships that

applied for licenses.
     In June 1994, the commission held an informal fact finding

conference to receive sworn testimony and exhibits on the

applications.   At the conference, each applicant delivered an

opening statement and rebuttal and was examined under oath by the

commission and by other applicants.     In addition, members of the

public were permitted to comment on each application.    A written

six-volume transcript of the conference was prepared and is part

of the administrative record.

     After the conference, the commission permitted the

applicants to file post-hearing submissions until June 23, 1994,

and proposed findings of fact and conclusions of law until June

28, 1994.   Because the applicants and the public continued to

file materials after the June deadlines, the commission reopened

the record on September 14, 1994.   The record was closed a second

time on September 21, 1994.

                                - 4 -
     In its case decision issued October 14, 1994, the commission

found that Colonial Downs' proposal to construct a racetrack in

New Kent County was superior to the other five proposals and

awarded Colonial Downs an owner's license and Stansley Racing an

operator's license.   The commission expressly found that Colonial

Downs and Stansley Racing possessed the best overall financial

plan and a proven management team, and that the Colonial Downs

facility could be developed more quickly than the other proposed

facilities and offered "the best site for a racetrack in

Virginia."   Furthermore, the commission found that Colonial Downs

and Stansley Racing had satisfied all of the statutory and

regulatory license criteria.
     Appellant appealed the awards to the circuit court pursuant

to Code § 59.1-373.   The circuit court affirmed the commission's

issuance of the licenses.   The trial court held that Code

§ 59.1-378 does not limit the commission's authority to grant

licenses to corporations only and that the commission did not act

arbitrarily by awarding Stansley Racing an operator's license,

even though it "did not technically apply" for a license.

                                I.

     We first address the commission's contention that the Court

of Appeals lacks jurisdiction over this appeal.   Code

§ 17-116.05(1) expressly provides that the Court of Appeals shall

have jurisdiction to review "[a]ny final decision of a circuit

court on appeal from a decision of an administrative agency."

                               - 5 -
However, the commission argues that the provisions of Code

§ 59.1-373 control jurisdiction in this case rather than the

general jurisdiction statute, and that by enacting Code § 59.1-

373, the legislature intended that appeals from the commission

would be by petition to the Supreme Court.

     Code § 59.1-373 provides:
          Any person aggrieved by a refusal of the
          Commission to issue any license or permit,
          the suspension or revocation of a license or
          permit, the imposition of a fine, or any
          other action of the Commission, may, within
          thirty days of such action, appeal to the
          Circuit Court of the City of Richmond. If
          the court finds that the action of the
          Commission was arbitrary, it shall order such
          action as it deems appropriate. The decision
          of the court shall be subject to appeal as in
          other cases at law.

(Emphasis added).   The commission contends that the General

Assembly made its intent clear by using the language "as in other

cases at law" because appeals of actions at law generally lie

with the Supreme Court.   Code § 8.01-670(A)(3). 2

     In Commonwealth v. E.W. Yeatts, Inc., 233 Va. 17, 353 S.E.2d
717 (1987), the Supreme Court held that the Court of Appeals has

jurisdiction over a "civil action" instituted pursuant to Code
          3
§ 33.1-387 because the right to file the action is dependent
     2
      Our decision concerning jurisdiction will determine whether
appeals from the circuit court's review of the racing
commission's decisions are entitled to be reviewed as a matter of
right by the Court of Appeals, Code § 17-116.05(1), or by
discretionary petition for appeal to the Supreme Court. Code
§ 8.01-670(A)(3).
     3
      Code § 33.1-387 authorizes a contractor who has a claim
against the Virginia Department of Transportation to file a civil

                               - 6 -
upon compliance with the administrative procedures set forth in

Code § 33.1-386. 4   Id. at 24, 353 S.E.2d at 721.   The Court

reasoned that "[d]ivining legislative intent . . . is not a

contest of labels but an exercise in common sense interpretation

of statutory language."     Id.   Therefore, because the right to

bring a civil action under Code § 33.1-387 arises in the context

of an administrative action, the Court held that it is "a

§ 17-116.05(1) appeal."     Id.
     The rationale in Yeatts is controlling here.     Use of the

terms "civil action" or "other cases at law" in a statute does

not, standing alone, define jurisdiction and divest this Court of

its express jurisdiction.    Had the legislature intended to grant

the Supreme Court jurisdiction over the circuit court's review of

appeals from the racing commission, it would have expressly so

provided. As the Supreme Court instructed in Yeatts, such an
(..continued)
petition for such portion of a claim that the Commissioner
administratively denies. The statute provides:

              As to such portion of the claim as is
          denied by the Commonwealth Transportation
          Commissioner, the contractor may institute a
          civil action for such sum as he claims to be
          entitled to under the contract for himself or
          for his subcontractors or for persons
          furnishing materials for the contract by the
          filing of a petition in the Circuit Court of
          the City of Richmond or where the highway
          project which is the subject of the contract
          is located. . . .

     4
      Code § 33.1-386 allows a contractor on a state highway
construction project to file a claim with the Department of
Transportation for amounts claimed to be owed on the contract.

                                  - 7 -
indirect reference should not be construed to define jurisdiction

or supercede the express mandate of Code § 17-116.05(1).

Accordingly, we deny the commission's motion to transfer

jurisdiction of this appeal to the Supreme Court.

                               II.

                               A.

     Appellant contends that a partnership is ineligible to

receive an owner's license under Code § 59.1-378.   Appellant

bases this contention upon language in Code § 59.1-378(C) to the

effect that the commission shall deny a license to any applicant

that is not a corporation which meets specified criteria.    The

appellant misconstrues the statute.   The conditions apply only to

applicants that are corporations and do not require that an

applicant be a corporation in order to be eligible for an owner's

license.
      "[A] fundamental rule of statutory construction requires

that courts view the entire body of legislation and the statutory

scheme to determine the `true intention of each part.'"     Virginia

Real Estate Bd. v. Clay, 9 Va. App. 152, 157, 384 S.E.2d 622, 625

(1989) (quoting McDaniel v. Commonwealth, 199 Va. 287, 292, 99
S.E.2d 623, 627 (1957)), appeal dismissed, 398 S.E.2d 78 (1990);

see also Moore v. Commonwealth, 155 Va. 1, 11, 155 S.E. 635, 638

(1930) (stating that "the legislative intention must be sought

from the whole act, and not merely from certain parts of it").

                              - 8 -
Code § 59.1-377 expressly permits "any person," which under the

Horse Racing Act includes a "natural person" or partnership, Code

§ 59.1-365, to apply for an owner's license.      Furthermore, Code

§ 59.1-378(B) directs the commission to deny a license to an

applicant if "the applicant, or any officer, partner, principal

stockholder, or director of the applicant" has engaged in

designated illegal conduct or undesirable practices.      Id.

(emphasis added).   Appellant's selective emphasis on certain

phrases in Code § 59.1-378(C) disregards the other statutory

provisions, which clearly indicate that individuals, joint

ventures, partnerships, associations, or corporations are

eligible to receive an owner's license.   See Virginia Elec. &

Power Co. v. Citizens for Safe Power, 222 Va. 866, 869, 284
S.E.2d 613, 615 (1981) (stating that "a statute is not to be

construed by singling out a particular phrase").     We hold,

therefore, that Code § 59.1-378(C), read in the context of the

Horse Racing Act, does not apply to all applicants, but only to

corporate applicants.   Thus, the trial court did not err in

holding that Colonial Downs, operating as a limited partnership,
                                              5
was eligible to receive an owner's license.
     5
      Appellant also contends that under Code § 59.1-382, the
commission can only award operator's licenses to corporations.
Because the commission awarded the operator's license to a
corporation, a ruling on this issue would not affect the outcome
of the controversy. "'The duty of this court, as of every other
judicial tribunal, is to decide actual controversies by a
judgment which can be carried into effect, and not to give
opinions upon moot questions or abstract propositions, or to
declare principles or rules of law which cannot affect the matter
in issue in the case before it.'" Hankins v. Town of Virginia

                               - 9 -
                                B.

     Appellant next contends that the trial court erred by

affirming the commission's decision to award an operator's

license to the Stansley Racing Corporation.   Appellant argues

that because Stansley Racing was not formed until June 1994, it

did not exist when applications were being submitted and its

officers did not file an application for an operator's license on

its behalf before the October 1, 1993 application deadline.
     Code § 59.1-381(A) provides that "[a]ny person desiring to

hold a race meeting or operate a satellite facility shall file

with the Commission an application for an operator's license."

Furthermore, Code § 59.1-382 provides that the commission shall

. . . grant a valid operator's license to applicants who meet the

criteria set forth in this chapter and established by the

Commission."   Id. (emphasis added).   Appellant contends that this

language is clear and unambiguous and that we cannot resort to

general rules of statutory construction.    See Allstate Ins. Co.
v. Eaton, 248 Va. 426, 430, 448 S.E.2d 652, 655 (1994).

Appellant argues that Stansley Racing did not exist on October 1,

1993, and did not apply for an operator's license.   Therefore,

Stansley Racing was not an "applicant," and the commission

exceeded its statutory authority by awarding Stansley Racing an

operator's license.

(..continued)
Beach, 182 Va. 642, 644, 29 S.E.2d 831, 832 (1944) (quoting Mills
v. Green, 159 U.S. 651, 653 (1895)) (emphasis added).

                              - 10 -
     Colonial Downs, a limited partnership, had filed a joint

application for licenses to own and operate a racetrack and

provided all of the required personal and financial information

concerning the partnership and the limited and general partners.

Several months after filing the application, Arnold Stansley and

James Leadbetter, the sole partners of Colonial Downs, formed a

corporation, Stansley Racing.    The partners informed the

commission that this corporation, of which they were the sole

stockholders, officers, and directors, would operate and manage

the racetrack if Colonial Downs was awarded the owner's license.

As the trial court noted in holding that Stansley Racing was

eligible to receive an operator's license, "[t]he same people who

owned [Colonial Downs] now own Stansley Racing Corp., and they

own it in the same percentages."    Therefore, the question raised

on these facts is not simply, as appellant suggests, whether the

commission can award a license to an entity that does not apply.

Clearly, an application must be filed before the commission may

award a license.   The critical issue before the commission, which

is the dispositive issue on appeal, is the extent to which the

commission possesses the inherent authority to discharge its

responsibility under the Act by allowing an applicant to change

its legal or organizational structure, or its ownership

interests, and to amend its application or supplement its

disclosure documents to reflect changes brought about by ongoing,

legitimate business decisions and financial transactions.

                                - 11 -
     Whether an administrative agency has acted within the scope

of its authority is a question of law.       Johnston-Willis, Ltd. v.

Kenley, 6 Va. App. 231, 242, 369 S.E.2d 1, 7 (1988).      "Where the

agency has the statutory authorization to make the kind of

decision it did and it did so within the statutory limits of its

discretion and with the intent of the statute in mind, it has not

committed an error of law . . . ."     Id.   However, as appellant

contends, when the question is whether the agency has "failed to

comply with statutory authority . . . less deference is required

and the reviewing courts should not abdicate their judicial

function and merely rubber-stamp an agency determination."       Id.

at 243, 369 S.E.2d at 7-8.

     Although the commission derives its powers from the Horse

Racing Act, "[t]he statutory grant of power is not strictly

limited . . . to the narrow confines of the express language of

the statute.   `[E]very power expressly granted, or fairly implied

from the language used, or which is necessary to enable [the

commission] to exercise the powers expressly granted, should and

must be accorded.'"   Muse v. Alcoholic Beverage Control Bd., 9
Va. App. 74, 78, 384 S.E.2d 110, 112 (1989) (quoting Portsmouth

v. Virginia Ry. & Power Co., 141 Va. 54, 61, 126 S.E. 362, 364

(1925)); see also Fairfax County v. Miller & Smith, Inc., 222 Va.
230, 237, 279 S.E.2d 158, 162 (1981).

     Code § 59.1-382 neither expressly grants nor denies the

commission the authority to allow an applicant to amend its

                              - 12 -
application or to supplement its disclosure document.   The Horse

Racing Act does not contain a definition of "applicant."     In

arguing that an applicant should not be permitted to amend its

application, particularly by substituting a newly formed

corporation for a partnership, the appellant urges this Court to

adopt the narrow definition of "applicant" that the legislature

has used in other instances.   See, e.g., Code § 3.1-126.2:1

("'Applicant' means the person who applies for, or requests, a

license, or applies for registration of any liming material; or

applies to become a contractor"); Code § 10.1-1400 ("'Applicant'

means any and all persons seeking or holding a permit required

under this chapter"); Code § 59.1-78 ("'Applicant' means a person

filing an application for registration of trademark, case mark or

service mark under this chapter, and includes his legal

representatives, successors and assigns").   However, because the

Act does not expressly address the administrative agency's

authority to allow amendments, substitutions, or supplements to

applications or disclosures, or the nature or extent of such

modification, we look to "[t]he `basic law' under which the

Commission acted and the purposes thereof" in order to determine

whether the commission exceeded its statutory authority by

granting Stansley Racing an operator's license.   Virginia

Alcoholic Beverage Control Comm'n v. York St. Inn, Inc., 220 Va.
310, 313, 257 S.E.2d 851, 853 (1979) (footnote omitted).     "Those

purposes must be gleaned from an analysis of the overall

                               - 13 -
statutory and regulatory scheme for the [licensing of

racetracks]."    Id. at 313-14, 257 S.E.2d at 853.

       The Code provisions that govern the licensing of owners and

operators of horse racing tracks with pari-mutuel betting address

two primary public policy concerns.     First, the legislation

emphasized protecting the honesty and integrity of horse racing

in the Commonwealth.    See Code §§ 59.1-364(A), -378(B), -379,

-382(5).   Applicants for both owner's and operator's licenses

must   provide the name and address of each individual who has an

ownership interest or other pecuniary interest, Code
§ 59.1-377(A)(2), and are required to disclose "[s]uch

information as the Commission deems appropriate regarding the

character, background and responsibility of the applicant and the

members, partners, stockholders, officers and directors of the

applicant."   Code § 59.1-377(A)(3).    Furthermore, the commission

must deny a license to an applicant if the applicant or one of

its owners has failed to disclose any information requested, or

has engaged in certain dishonest, fraudulent, unethical, illegal,

or questionable practices or behavior.     See Code §§ 59.1-378(B),

-379; see also Code § 59.1-382(5) (providing that "[t]he

Commission shall deny a license to any applicant, unless it finds

. . . [t]hat the applicant has made provisions satisfactory to

the Commission for the detection and prosecution of any illegal,

corrupt or fraudulent act, practice or conduct in connection with

any race meeting or pari-mutuel wagering").

                               - 14 -
     Second, the legislation is designed to ensure that horse

racing is conducted on a sound financial basis, according to

accepted business and management practices, in order to promote

the success and growth of the horse racing industry in the

Commonwealth.   See Code § 59.1-364(A) ("Horse racing with pari-

mutuel wagering as licensed herein shall be permitted in the

Commonwealth for the promotion, sustenance and growth of a native

industry, in a manner consistent with the health, safety and

welfare of the people").    Under Code § 59.1-377, the application

must provide information pertaining to the financial

responsibility of all applicants or persons with a financial

interest in the operation, the terms of leases or financing

agreements, and detailed information about all stockholders,

officers, and directors of a corporate owner, or each individual

or partner of a partnership or joint venture.     The commission is

further instructed to "deny a license to any applicant, unless it

finds that the applicant's facilities are or will be appropriate

for the finest quality of racing, and meet or will meet the

minimum standards that any track provided for standard breed

racing be at least five-eighths of a mile, that any dirt track

provided for flat racing be at least one mile, and that any track

provided for flat or jump racing on the turf be at least

seven-eighths of a mile."   Code § 59.1-378(A).   The commission is

given broad discretion to "require such information about the

enclosure and location of [the proposed] track as it deems

                               - 15 -
necessary and appropriate to determine whether they comply with

the minimum standards provided in this chapter, and whether the

conduct of a race meeting or pari-mutuel wagering at such

location would be in the best interests of the people of the

Commonwealth."   Code § 59.1-377(A)(4).

     The application procedure is intended to ensure that the

commission obtains and possesses all information necessary and

desirable in order for it to render decisions that will promote

"honesty and integrity" and the "growth of a native industry."

Code § 59.1-364(A).   Clearly the legislature did not intend to

unduly restrict the racing commission's ability to authorize

applicants to pursue sound business or financial practices.     The

General Assembly granted the commission broad power and

discretion to prescribe the information required in the

application process and to evaluate the applications.   Inherent

in this broad grant of authority is the power to approve or

require any amendments, substitutions, or supplements that sound

business practices may dictate.
     As the trial court noted, the commission "had all of the

facts before it necessary to render its decision."   Stansley

Racing provided the commission with copies of its articles of

incorporation and bylaws.   From these documents, as well as the

other information provided, the commission was able to determine

that Arnold Stansley and James Leadbetter were Stansley Racing

Corporation's sole stockholders and directors and that Stansley

                              - 16 -
Racing was in compliance with Code § 59.1-382.   The partners in

Colonial Downs were the same persons who were the sole

stockholders, officers, and directors of Stansley Racing.

Furthermore, the formation of Stansley Racing did not affect or

alter the substance of Colonial Downs' application with respect

to the location, design, financing, and plan of operation for the

proposed racetrack.   The substitution of Stansley Racing for

Colonial Downs did not require the commission to investigate

additional parties or evaluate a proposal different from that

which Colonial Downs offered.    For these reasons, the

commission's decision to award a license to Stansley Racing

without requiring it to file a separate application did not

exceed the commission's statutory authority.
     If we adopted appellant's narrow definition of the

commission's authority, we would frustrate the commission's

ability to award licenses in a manner that would be "in the best

interests of the people of the Commonwealth."    The commission

might determine that an individual applicant's racetrack proposal

was far superior to all other proposals, but that the interests

of horse racing in Virginia would be better served if the

applicant was a corporation that would have an ongoing existence

as opposed to an individual or partnership.    These considerations

would fall within the commission's expertise and discretion.

     Nonetheless, under appellant's interpretation of the

commission's statutory authority, the commission would

                                - 17 -
essentially be limited to four options:    it could request the

individual applicant to incorporate and resubmit another

application; it could award the individual applicant the license

despite its misgivings; it could reject a superior application

for a less desirable one; or it could reject all applications and

repeat the application process. 6   All of these options would

hinder and unduly limit the commission in its ability to

"promptly consider" the applications, Code § 59.1-382, and, most

importantly, to work with, foster, oversee, and award licenses to

applicants in a manner that will serve "the best interests of the

people of the Commonwealth."   Code § 59.1-377(A)(4).   We hold,

therefore, that the commission did not exceed its authority by

awarding the license to a corporation when the stockholders,

officers, and directors were the partners in the limited

partnership that submitted the approved application.    The ability

of the commission to make business decisions of this nature "is

necessary to enable [the commission] to exercise the powers
     6
      The facts of this case raise a similar scenario.
Apparently, the formation of Stansley Racing was in response to
concern that only corporations may qualify to obtain an
operator's license under Code § 59.1-382(1). Although the proper
interpretation of Code § 59.1-382 is not an issue before this
Court, the statutory language reasonably interpreted suggests
that only corporations are eligible to receive an operator's
license. Therefore, the commission was faced with the
possibility that three of the joint applicants were ineligible to
receive an operator's license.   Under appellant's interpretation
of the commission's authority, the only options available to the
commission were to begin the application process over again or
award the license to one of the corporate applicants regardless
of whether their proposals would best serve the interests of the
people of the Commonwealth.

                               - 18 -
expressly granted." 7   Muse, 9 Va. App. at 78, 384 S.E.2d at 112

(quoting Portsmouth v. Virginia Ry. & Power Co., 141 Va. at 61,

126 S.E. at 364 (1925)).

     The commission's decision to treat Stansley Racing as an

applicant on the facts of this case was a matter reserved for its

expertise and discretion.    A contrary finding would not only

frustrate the Horse Racing Act's purposes, but would conflict

with the maxim "'that the [administrative agency] shall apply

expert discretion to the matters coming within its cognizance,

     7
      Appellant also notes that the commission's instructions
regarding the applications provide that "[a]mendments will be
accepted until January 3, 1994." However, it is clear from the
commission's actions throughout the application process that the
deadline applied to when applicants could amend their
applications as a matter of right. The deadline did not preclude
the commission from allowing amendments or supplements to the
application process which might be necessary or desirable for
business reasons, provided the commission did not allow or
prohibit amendments by the various applicants. "[T]he
interpretation which an administrative agency gives its
regulation must be accorded great deference and will not be set
aside unless arbitrary and capricious." Virginia Real Estate Bd.
v. Clay, 9 Va. App. 152, 159, 384 S.E.2d 622, 626 (1989). The
only indication in the instructions regarding the meaning of the
term "amendments" is the statement that "[m]ergers and
acquisitions of ownership interest by persons other than those
listed in the application will be treated as an amendment to the
application(s) affected by the merger or change in ownership."
Because the commission had to investigate all persons with an
ownership interest in the applicants, it had good reason to be
more concerned with changes in ownership as opposed to changes
that did not involve the addition of new parties. Moreover, the
commission gave all applicants the opportunity to make changes to
their organizational structure after January 3, 1994. Appellant,
for instance, amended its articles of incorporation in April 1994
to provide for the repurchase of stock in accordance with Code
§ 59.1-378. We hold, therefore, that the commission's
interpretation and application of its instructions regarding the
deadline for amendments was neither arbitrary nor capricious.

                               - 19 -
and judicial interference is permissible only for relief against

the arbitrary or capricious action that constitutes a clear abuse

of the delegated discretion.'"   York St. Inn, 220 Va. at 315, 257

S.E.2d at 855 (quoting Schmidt v. Board of Adjustment of City of

Newark, 9 N.J. 405, 423, 88 A.2d 607, 615-16 (1952)); see

Johnston-Willis, 6 Va. App. at 244, 369 S.E.2d at 8 ("[W]here the

question involves an interpretation which is within the

specialized competence of the agency and the agency has been

entrusted with wide discretion by the General Assembly, the

agency's decision is entitled to special weight in the courts").
     The commission did not exceed the scope of its statutory

authority, and we affirm the trial court's decision.

                                                          Affirmed.

                             - 20 -
BAKER, J., concurring in part, dissenting in part.

     I respectfully disagree with the majority's affirmation of

the trial court's finding that an operator's license was legally

granted to an entity that did not apply for such license within

the time set by the Virginia Racing Commission (commission).

     It is clear from this record that the commission set October

1, 1993 as the deadline for filing applications.   Yet, it has

granted an operator's license to a corporation that was not in

existence when that deadline passed.   That was not a mere

"technical" error.   For this reason, I would reverse the trial

court's judgment and remand the matter with direction that the

trial court enter an order revoking the operator's license

granted to Stansley Racing Corporation by the commission.
     I agree that this Court has jurisdiction to decide matters

over which the commission has authority and that there is nothing

in the statutes that created its authority which requires owners

or operators to be corporate entities.

                              - 21 -