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In the Matter of the Application of El Piscis, Inc.

367 N.J. Super. 1, 842 A.2d 170 (App. Div. 2002)

LIQUOR LICENSES; RENEWAL—When a liquor license’s viability is under litigation, there is no administrative need for the license holder to attempt to renew the license; therefore, once the litigation is resolved favorably to the license holder, the holder should be able to pursue renewal even if deadlines for that renewal have already passed.

A license holder timely filed a renewal application for its plenary retail alcohol consumption license for the 1998-99 term. The municipality denied the application for multiple reasons and the company appealed. After extended litigation, the company was notified in May, 2000 that the dispute regarding the 1998-99 license renewal had been resolved. However, the company was told that its renewal application for the 1999-2000 term had not been filed. Therefore, the company sought relief from the Director of the Division of Alcoholic Beverage Control (ABC) under N.J.S.A. 33:1-12.18, which allows applicants to obtain license renewals if timely renewal was prevented by circumstances beyond the licensee’s control. The ABC Director held that the company’s license had permanently lapsed and that there had not been substantial compliance with the renewal requirements to excuse its failure to timely renew its license.

The Appellate Division disagreed. It stated that when the municipality denied renewal of the license in 1998, the license was to terminate two weeks later. Therefore, after those two weeks, the company would no longer be the holder of any viable license. Thus, the Court held that a licensee could have reasonably assumed that its license was jeopardized by the action and that further applications for renewal would have been a waste of money. Clearly, any application made to renew the license during the two weeks would have been denied. According to the Appellate Division, whether an apparently futile action must nevertheless be taken needs to be balanced against the administrative needs served by the action. From the municipality’s perspective, it served no purpose for the company to seek renewal for 1999-2000. According to the municipality, it had already determined that the license would not be renewed. Thus, if the company sought renewal, it would have been denied. Since the license’s viability was already under litigation, there was no administrative need for the licenseholder to attempt to renew the license. As a consequence, the Court reversed the ABC decision and reinstated the license for 1999-2000. Furthermore, because of the license’s inactivity, the Court remanded the matter to the ABC Director to determine whether relief would have been warranted when initially requested in 2000.

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