
    In the Matter of Kerma Restaurant Corporation, Appellant, v. State Liquor Authority, Respondent.
    Argued October 30, 1967;
    decided December 7, 1967.
    
      
      Isidore Silver for appellant.
    I. There was no substantial evidence to support respondent’s finding that appellant had permitted the premises to become disorderly in violation of subdivision 6 of section 106 of the Alcoholic Beverage Control Law. (Matter of Guerra v. New York State Liq. Auth., 35 Misc 2d 564, 18 A D 2d 869; Matter of Mur-Art-Sol v. State Liq. Auth., 6 A D 2d 683; Matter of Stanwood United v. O’Connell, 283 App. Div. 79, 306 N. Y. 749; Matter of Migliaccio v. O’Connell, 307 N. Y. 566; People ex rel. Price v. Sheffield Farms-Slawson-Decker Co., 225 N. Y. 25; Matter of F & C Holding Corp. v. State Liq. Auth., 27 A D 2d 806; Matter of St. Alban’s Bowl v. New York State Liq. Auth., 20 A D 2d 543; Matter of Coney-O-Tavern v. New York State Liq. Auth., 25 A D 2d 549; Matter of 2125 Barney’s Inc. v. New York State Liq. Auth., 16 A D 2d 252, 13 N Y 2d 662.) II. Revocation of appellant’s license under the circumstances is harsh, arbitrary and capricious, an egregious abuse of discretion and deprives appellant of a property right without due process of law in violation of the Fourteenth Amendment to the United States Constitution. (Matter of Standard Food Prods. Corp. v. O’Connell, 296 N. Y. 52; Schware v. Board of Bar Examiners, 353 U. S. 232; Midwest Beverage Co. v. Gates, 61 F. Supp. 688; Glicker v. Michigan Liq. Control Comm., 160 F. 2d 96; Lewis v. City of Grand Rapids, 222 F. Supp. 349; Matter of Don Lerner Rest. v. New York State Liq. Auth., 18 A D 2d 911; Matter of Miller v. New York State Liq. Auth., 20 A D 2d 725; Matter of Newman Lake House v. Bruckman, 258 App. Div. 765; Matter of Lynch’s Bldrs. Rest. v. O’Connell, 303 N. Y. 408; Matter of Gilmer v. Hostetter, 20 A D 2d 586; Matter of Fulton Bar & Grill v. State Liq. Auth., 11 A D 2d 771.) III. Subdivision 6 of section 106 of the Alcoholic Beverage Control Law, as presently interpreted by the New York courts, is unconstitutionally vague. Such section, when applied to sufferanee of homosexual conduct on licensed premises, is only constitutional when it penalizes licensees for suffering acts which are in themselves lewd or flagrantly immoral and only when it is applied nondiscriminatorily. (Matter of Katz’s Delicatessen v. O’Connell, 302 N Y. 286; People v. Firth, 3 N Y 2d 472; Time, Inc. v. Hill, 385 U. S. 374; Matter of Guerra v. New York State Liq. Auth., 35 Misc 2d 564; Matter of Migliaccio v. O’Connell, 307 N. Y. 566; People v. Bart’s Rest. Corp., 42 Misc 2d 1093; Yick Wo v. Hopkins, 118 U. S. 356; People v. Utica Daw’s Drug Co., 16 A D 2d 12.)
    
      Stanley Stein, Hyman Amsel and Emanuel D. Black for respondent.
    I. The record discloses substantial evidence to sustain the determination of the Authority that petitioner violated subdivision 6 of section 106 of the Alcoholic Beverage Control Law as charged. (Matter of Humphrey v. State Ins. Fund, 298 N. Y. 327; Matter of Miller v. Kling, 291 N. Y. 65; Matter of Avon Bar & Grill v. O’Connell, 301 N. Y. 150; Matter of Kopec v. Buffalo Brake Beam-Acme Steel & Malleable Iron Works, 304 N. Y. 65; National Labor Relations Bd. v. Nevada Cons. Copper Corp., 316 U. S. 105; National Labor Relations Bd. v. Pennsylvania Greyhound Lines, 303 U. S. 261; Matter of Holland v. Edwards, 307 N. Y. 38; Matter of Gordon v. New York Life Ins. Co., 300 N. Y. 652; Matter of Egan v. New York State Joint Legis. Committee, 2 A D 2d 418; Matter of Hill, Thompson & Co. v. Goodrich, 286 App. Div. 606; Matter of Stork Rest. v. Boland, 282 N. Y. 256.) II. The measure of penalty imposed by the gtate Liquor Authority was a reasonable exercise of its discretion, it was lawful and did not violate any rights of petitioner. (Bertholf v. O’Reilly, 74 N. Y. 509; Matter of Wager v. State Liq. Auth., 4 N Y 2d 465; Matter of Yates v. Mulrooney, 245 App. Div. 146; Crowley v. Christensen, 137 U. S. 86; People ex rel. Lodes v. Department of Health of City of N. Y., 189 N. Y. 187; Matter of Fink v. Cole, 1 N Y 2d 48; Metropolitan Bd. of Excise v. Barrie, 34 N. Y. 657; Matter of McGinnis’ Broadway Rest. v. Rohan, 6 A D 2d 115, 6 N Y 2d 770; Matter of Johnston v. Rohan, 2 A D 2d 932; Matter of Bomysoad v. New York State Liq. Auth., 13 A D 2d 873.) III. gubdivision 6 of section 106 of the Alcoholic Beverage Control Law is a valid and constitutional statutory provision. (Matter of 181 Rest. Corp. v. O’Connell, 278 App. Div. 906, 302 N. Y. 950; Matter of 
      
      Elite Rest. v. New York State Liq. Auth., 284 App. Div. 1038; Matter of Oriental House v. New York State Liq. Auth., 284 App. Div. 1038, 308 N. Y. 1050; Matter of Lenore F. Moore, Inc. v. O’Connell, 278 App. Div. 811, 303 N. Y. 1014; Shonfeld v. Shonfeld, 260 N. Y. 477.) IV. No appeal lies from an order of the Appellate Division denying reargument. (Phelan v. Houghton, 9 A D 2d 767; Cohen v. Kaskel, 280 App. Div. 992.)
   Bergan, J.

Petitioner’s retail liquor license has been annulled by respondent on a charge that it suffered or permitted the licensed premises to become disorderly (Alcoholic Beverage Control Law, § 106, subd. 6) “in that it permitted homosexuals, degenerates and/or undesirables to be and remain on the licensed premises and conduct themselves in an offensive and indecent manner contrary to good morals on 2/4/66 ”.

There is no proof in the record of any breach of the peace. The Appellate Division observed: ‘‘ While we agree the mere congregation of homosexuals, where there is no breach of the peace, does not make the premises disorderly within the meaning of subdivision 6 of section 106 of the Alcoholic Beverage Control Law, the record substantiates the charge.” Justice McGivern noted in dissent that there ‘ ‘ simply is not substantial evidence to warrant cancellation of the license on the grounds that the premises were disorderly.” This seems to be an accurate appraisal of the record.

In the first place there is no evidence to attribute to the licensee knowledge that the police officer had been solicited by a customer for homosexual purposes and the proof of this transaction must be eliminated from consideration as offering any support of the finding of disorder in the premises.

There were 40 customers in the bar attended by one bartender, the petitioner’s president, Mrs. Weinzierl. She, as the policeman testified, “was busy tending bar”. The conversation in which the policeman testified he was solicited occurred at a jukebox near the front window. There is no proof that the bartender was anywhere near this conversation or in any position to overhear it, and knowledge of its occurrence and its disorderly potential has not been brought home to the bartender.

The decisions make it clear that this personal conversation between two men in the front of premises crowded with patrons and serviced by one busy bartender is not enough to attribute responsible knowledge to the licensee. (Matter of Abatz v. State Liq. Auth., 15 N Y 2d 643; Matter of Migliaccio v. O’Connell, 307 N. Y. 566; Matter of Stanwood United v. O’Connell, 306 N. Y. 749.)

It is manifest from the findings of the deputy commissioner that this solicitation was an essential basis of the decision to sustain the charge. He said: “ I find that the patronage was openly homosexual in nature, that the officer was solicited by one of the male patrons herein for lewd and indecent purposes, that the officer and said male then ordered twó (2) glasses of beer and left.”

The policeman who made the arrest after he had left the premises and who came back later to issue a criminal summons to Mrs. Weinzierl for allowing the premises to become disorderly ’ ’ based this charge entirely on the fact that he had arrested a male for violation of the Penal Law and defendant was present and in charge ’ ’. This criminal charge was dismissed. The other proof in the proceeding is insufficient to establish the premises were permitted to become disorderly. In some measure this part of the charge is based on the policeman’s observations of the dress and appearance of “ several of the patrons ” and of “ three specific cases ”. These several had “ makeup on, eye mascara, some with lipstick ”. The three specific cases had hip hugger pants, slacks * * * their shirts out of their trousers ” showing “ a bare midriff ”.

Indulgence in the inference that these “ several” and these ‘ three specific ’ ’ men in a grill containing 40 people were, from their dress and makeup, homosexuals does not support the additional inference that they would create disorder. It is reasonable to think that even though he dresses strangely a homosexual may be orderly in the sense in which the Alcoholic Beverage Control Law defines order.

The policeman also observed “ three instances ” in which one male “ would be ” sitting on another male’s lap at the tables ”. He noticed also “ three instances ” where the males on the laps kissed the other male on the face and neck. There is no proof that the bartender was in a position to observe, or did observe, these ‘‘ three instances ’’. For the rest: “I observed several of the males when they walked away their hips, keep their hands on their hips. Several of the males’ voices were very effeminate and high pitched, and talked with a lisp.” These ‘‘ observations ’’ are not brought home to the licensee.

But assuming from the proof as a whole that the licensee knew some homosexuals were in the place, is this disorder in the absence of some proof tending to actual disorder? If homosexual solicitation could be brought home to the licensee that would be enough; but it is certainly not demonstrated in this case, and the rest of the proof tending to disorder is insufficient. (See opinion of Justice Cohn at the Appellate Division in Matter of Stanwood United v. O’Connell, 283 App. Div. 79, 80, 81, affd. 306 N. Y. 749, cited supra). The record before us is weaker on the issue of general potential disorder than that in Matter of Migliaccio v. O’Connell {supra).

The order should be reversed and the determination of respondent annulled, with costs.

Keating, J. (dissenting).

There is no doubt, as the majority points out, that proof of a solicitation for lewd and immoral purposes is not sufficient by itself to justify annulment of a liquor license. The statute states: “No person * * * shall suffer or permit * * * such premises to become disorderly. ’ ’ It is, therefore, incumbent upon the Authority to show that the licensee knew or should have known of the disorderly conduct on the premises. (See Matter of Migliaccio v. O’Connell, 307 N. Y. 566.)

The police officer testified that there were about 30 persons on the premises," all of them male. He stated: “I saw several of the patrons with makeup on, eye mascara, some with lipstick. * * * I observed two—three instances where one male would be sitting on another male’s lap at the tables. I observed three instances where these three same males previously described kissed on the face and neck the males in whose laps they were sitting. ’ ’

It is inconceivable that overt behavior such as this escaped the notice of the licensee, particularly since there were only 30 persons present.

In any event, the issue is whether she should have been aware of what was happening on her premises. In defining the quantum of evidence necessary to sustain the annulment of a license for violation of subdivision 6 of section 106 we have held:

“ [Substantial evidence of disorderliness—beyond a brief single occurrence of which the licensee may or may not have been aware — should be presented so as to establish that the licensee should have known that a disorderly condition prevailed.” (Matter of Migliaccio v. O’Connell, supra, p. 569; emphasis supplied.)

Even if we credited the licensee’s statements that she did not, in fact, observe the behavior which the officer described, nevertheless his description of the premises was such that it was not unreasonable for the Authority to conclude that the licensee should have known of the disorderly conduct taking place in her establishment.

Moreover, besides the public necking between males, there is an additional factor which tends to show notice on the part of the licensee. The police officer testified that about a half hour after he entered the premises, the licensee locked the door. After this, she let in certain persons by means of a buzzer which was located behind the bar. Several times, she refused to buzz someone in, but did so after he was identified to her by one of the male patrons. Thus, to a certain extent, the patronage was controlled by the licensee.

It is contrary, in our view, to common experience to believe that a licensee who exercised such vigilance regarding the identity of those who entered her premises would fail to notice overt behavior of the sort described by the officer.

In any event, the cumulative testimony of the police officer is sufficient, in our view, to support a conclusion that the licensee knew or at least should have known of the disorderly condition of her premises.

There is substantial evidence to support the action of the Authority. The order of the Appellate Division should be affirmed.

Chief Judge Fuld and Judges Van Voorhis and Burke concur with Judge Bergan ; Judge Keating dissents and votes to affirm in a separate opinion in which Judges Scileppi and Breitel concur.

Order reversed, with costs in all courts, and matter remitted to Special Term for further proceedings in accordance with the opinion herein. 
      
       They had been described by the officer as wearing hip hugger pants and their shirts tied in the front so as to reveal their bare midriffs.
     