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In Re Application for Relief Pursuant to N.J.S.A. 33:1-12.18

A-5935-06T2 (N.J. Super. App. Div. 2008) (Unpublished)

LIQUOR LICENSE — Failure to timely renew a liquor license can cause loss of the license, but substantial compliance with the renewal provisions, including a licensee’s conduct in reasonably pursuing its available remedies to obtain the license renewal, can serve to toll the renewal deadline.

Named holders of a retail liquor license had last renewed their license for the 2000-2001 term. Applications for renewal for the following two terms were not acted upon in a timely fashion by the municipality. In a contested matter before the Director of the Division of Alcoholic Beverage Control, the Director found that the municipality’s failure to act timely was a “de facto denial” of the renewal applications. The Director also found the license lapsed in 2001 because of a failure to timely file renewal applications for 2004-2007 and because no appeal was taken for the denial of the 2001-2003 terms. The Director also noted proofs of minimal sales and sales tax paid for the years 1998-2000.

The licensees appealed its petition denial for license renewal, arguing that the law disfavors forfeiture of a liquor license and allows for activation of a license even after extended periods of apparent inactivity. The licensees argued that the primary fault for any license inactivity rested with the municipality who allegedly thwarted their efforts to renovate and sell their premises and license.

The Appellate Division remanded the matter to the lower court on the question of substantial compliance. The Court held that the Director had to evaluate whether the licensees’ conduct in reasonably pursuing their available remedies entitled them, as a matter of fairness, to an opportunity to take practical steps necessary to realize the value of the license.

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