Court overturns state alcohol board’s regulatory ruling barring delivery of alcohol to special event locations like festivals for those licensed to sell liquor, beer, and wine at those events.

In this case, a Florida bar appealed from a decision of the Florida Department of Business and Professional Regulation’s Division of Alcoholic Beverages and Tobacco finding that the license granting it a right to sell alcohol at catered special events, like music and other festivals, did not allow the licensee the right to receive deliveries of alcohol at catered events where they were lawfully allowed to sell alcohol. – That’s right, a state alcohol regulatory equivalent of created sick and commanded to be sound.

The bar had initially sought a declaratory statement from the alcohol regulator that they could accept deliveries of beer, wine and spirits at the locations of the special events. The bar presented information to the alcohol regulatory authority regarding the on-site deliveries of alcohol and how they would eliminate costs that the bar would have to incur (and likely pass on to consumers) if they had to receive alcohol deliveries at their business location and then transport that alcohol to the special event location site.

This argument did not prevail with the state alcohol agency and the department issued an order stating that licensed vendors cannot receive deliveries of alcohol at catered events where they can lawfully sell alcohol. 

The licensee appealed that decision. 

In ruling for the licensee against the arbitrary and capricious determination of the regulatory agency, the Court noticed that the statute contained no such prohibition on delivering alcohol to festivals or the locations of other catered special events:

The statute contains no restrictions on when, where, or how a distributor may make deliveries, so long as the deliveries are made in an appropriately licensed vehicle. Cf. § 561.56, Fla. Stat. (2018) (providing that distributors may transport alcohol “from one place in this state to another place in this state”).

The opinion goes on to note that the regulator rendered its decision in spite of the lack of citation or authority under the alcoholic beverage laws for such a prohibition on the delivery of alcoholic beverages. The Court even notes that the Department acknowledged that there was no such prohibition on delivery in the alcoholic beverage statutes. The opinion shows how this results in an oddly perplexing result since there is no allowance for delivery as well:

Despite acknowledging that nothing in the Beverage Law “addresses when or where a licensed alcoholic beverage vendor may receive a delivery of alcoholic beverages purchased by a licensed distributor,” Final Order ¶37, the Department concludes that deliveries to catered-event sites are nonetheless unlawful. According to the Department, the Beverage Law’s silence actually indicates the Legislature’s intent to prohibit deliveries anywhere other than a “licensed premises.” Moreover, in arguing that catered-event-site deliveries are unlawful because the Beverage Law does not explicitly authorize them, the Department ignores the fact that the Beverage Law likewise does not explicitly authorize licensed-premises deliveries. In fact, the Beverage Law does not explicitly authorize delivery anywhere; it is silent on that. We cannot from this hold that catered-event-site deliveries are unlawful.

Finally, for the administrative law junkies out there. The Court also pointed out that an argument raised against delivery (by distributors no doubt looking to not have to make these deliveries because it creates some extra deliveries for them) regarding the rule-making process applied equally to an affirmative answer in a declaratory request as well as a negative one. Both are counted as “rules” that would require following the administrative rule-making process:

The intervenors also argue that the Department could not issue a declaratory statement approving catered-event-site deliveries because that would amount to a rule of general applicability, which must be done through rulemaking. It is unclear why a declaratory statement the other way—like the one on appeal—would not likewise be subject to the same argument: If a declaratory statement announcing a practice’s lawfulness is a rule of general applicability, so too is a statement announcing a practice’s unlawfulness. Regardless, this court has held that when facing a petition for a declaratory statement that would “ha[ve] such a broad and general application that it meets the definition of a rule,” the agency still must issue the declaratory statement (if otherwise appropriate) but must simultaneously initiate the rulemaking process. 

The Court reversed the regulator’s determination barring deliveries to the site of the special event that the caterer was providing liquor for but remanded for unaddressed determinations as to whether the deliveries violated tied-house laws.

There is a dissent, but it seems to equate the words “delivery” and “transported” in a section of the law discussing how alcoholic beverages may be transported and makes no reference to deliveries and doesn’t use the word deliver or a derivative of it. It also 

Prohibitions or restrictions on deliveries wouldn’t just financially impact the liquor retailers looking to have alcoholic beverages brought to the festival sites. It would mean that for any large order a caterer couldn’t arrange a special delivery to the site of the event – raising prices on everyone involved. It would also potentially prohibit dock sales – sales by alcohol distributors or brewers or others at their location to retailers looking for a small order on a rush basis that might need to be fulfilled on a moment’s notice. (Say that Miami bar ran out of Aperol on a Friday night and needed some for the Saturday spritz rush).

You can read the court’s opinion in this liquor licensing regulatory matter here.