APPEAL FROM FRANKLIN CIRCUIT COURT HONORABLE THOMAS D. WINGATE, JUDGE ACTION NO. 10-CI-00991
The opinion of the court was delivered by: Vanmeter, Judge:
RENDERED: JANUARY 4, 2013; 10:00 A.M.
BEFORE: NICKELL, TAYLOR, AND VANMETER, JUDGES.
O'Shea's-Baxter, LLC, d/b/a Flanagan's Ale House ("Flanagan's") appeals from an opinion and order of the Franklin Circuit Court denying its motion for summary judgment and granting summary judgment in favor of the Louisville/Jefferson County Metro Government ("Metro") and Commonwealth of Kentucky, Alcoholic Beverage Control Board ("ABC Board") affirming a final order issued by the ABC Board upholding Metro's denial of Flanagan's application for a retail liquor by the drink license. Having heard oral arguments and considered the error raised by Flanagan's, we reverse and remand this matter to the Franklin Circuit Court.
The underlying facts of this case are not in dispute. Flanagan's
operates an establishment at 934 Baxter Avenue in Louisville,
Kentucky. It applied for a retail liquor drink license to replace its
restaurant drink license. Metro denied the application on the basis
that the license would be located within 700 feet of another similarly
licensed establishment and would therefore violate KRS*fn1
241.075(2). Flanagan's appealed the decision to the ABC
Board, which upheld the denial.
Thereafter, Flanagan's appealed the decision of the ABC Board to the Franklin Circuit Court. Flanagan's conceded that its establishment was located within 700 feet of a similarly licensed establishment, but argued that KRS 241.075(2) is unconstitutional because it constitutes local or special legislation in violation of Sections 59 and 60 of the Kentucky Constitution. The parties filed cross-motions for summary judgment, and in an opinion and order entered August 9, 2011, the trial court granted summary judgment in favor of Metro and the ABC Board, finding KRS 241.075(2) constitutional because "an important public purpose is served by limiting the density of establishments authorized to serve and sell liquor in combination residential/commercial areas." This appeal followed.*fn2
On appeal, Flanagan's maintains that KRS 241.075(2) is unconstitutional and that the trial court erred by relying on the statute to rule in favor of Metro and the ABC Board and effectively deny its liquor license application. We agree.*fn3
The constitutionality of a statute is a question of law subject to de novo review. Moore v. Ward, 377 S.W.2d 881, 883 (Ky. 1964). Section 59 of the Kentucky Constitution prohibits the General Assembly from enacting local or special legislation for a variety of purposes. Specifically, Section 59 provides that "[i]n all other cases where a general law can be made applicable, no special law shall be enacted." Ky. Const. § 59. Correspondingly, Section 60 bars enactment of special legislation indirectly exempting any city, town, district or county from the operation of a general act. Ky. Const. § 60. These two sections prevent the enactment of laws that do not operate alike upon all individuals and corporations.
Jefferson County Police Merit Bd. v. Bilyeu, 634 S.W.2d 414, 416 (Ky. 1982) (citing City of Louisville v. Kuntz, 104 Ky. 584, 47 S.W. 592 (1898)).
The statute at issue in the case at bar, KRS 241.075(1), authorizes the ABC Board to divide cities of the first class or consolidated local governments into "downtown business areas" and "combination business and residential areas" for the purpose of regulating the location of retail package liquor and retail drink licenses. These classifications only exist in cities of the first-class or consolidated local governments. KRS 241.075(1).*fn4 Subsection (2)'s requirement of a distance of 700 feet between retail liquor licenses applies only to licensees "in any combination business and residential area," excluding the same requirement for "downtown business areas." KRS 241.075(2).
We note that legislative enactments are entitled to a strong presumption of constitutionality. Wynn v. Ibold, Inc., 969 S.W.2d 695 (Ky. 1998). And courts have previously held that "[g]iven the unique nature of the regulation and licensing of the sale of alcoholic beverages, almost any content-neutral, legislative classification based on the types of businesses or organizations eligible to sell alcoholic beverages would not constitute special legislation within the meaning of § 59." Temperance League of Kentucky v. Perry, 74 S.W.3d 730, 733 (Ky. 2002) (citations omitted). Nevertheless, for legislation to comply with Section 59, "(1) [i]t must apply equally to all in a class, and (2) there must be distinctive and natural reasons inducing and supporting the classification." Schoo v. Rose, 270 S.W.2d 940, 941 (Ky. 1954) (citations omitted). When regulating a particular class of city based on the density of its ...