Signing Your Annual License Renewal By An Unauthorized Individual Can Cause Big Problems

Law Offices of John P. Connell, P.C.: As has been the case for many years but which was recently revisited in the ABCC’s Decision of In Re: Franco Restaurant, Inc. (December 19, 2018), signing an annual liquor license renewal form by an-unauthorized person can result in the revocation of that license.

In general, the law in Massachusetts is that when submitting your annual renewal forms to renew your liquor license from one year to the next, only a corporate officer, a director, a shareholder, a licensed manager of record, or an individual owner (all of whom need to have been previously disclosed and approved by the local licensing authority (in the case of retail licenses) and the ABCC) is authorized to sign the annual renewal form, which generally states under oath that there has been no changes in the ownership and management of the licensee that needs to be approved.

In the ABCC’s decision in Franco, the owner of a licensed restaurant passed away and a relative began operating the restaurant for a few years without obtaining the necessary disclosure and approval for the regulators. The annual renewal forms were apparently submitted as un-signed or were signed by the relative who had a similar name to the deceased owner and the local licensing authority never caught the issue. For this infraction, operating the business without regulatory approval by the relative, the ABCC indefinitely suspended the restaurant’s license as a violation of G.L. c. 138, §15A, which requires disclosures of new individuals with an interest in the license.

However, after operating the business for a few years, the relative then sold the business to a third party but again the third party, perhaps unaware of the law, did not seek approval of the regulators for him to have an interest in this liquor license. That third party then signed his own name to the annual renewal forms wherein again the local licensing authority did not catch the error. When the ABCC did catch the error, the submission of a renewal application by an unauthorized individual, the ABCC revoked the license altogether as a violation of G.L. c. 138, §16A. The language of the ABCC in Franco is harsh in that the ABCC held as follows:

“The specific language of this chapter mandates that the Commission revoke the license of Franco Restaurant, Inc. . . .As the Commission acknowledged [in previous cases], no other sanction is available for the Commission to consider given the express language of the statute. The Commission has no discretion here and must revoke the license forthwith.” (Emphasis added.)

There are few liquor license violations, if any, that requires the ABCC to revoke a liquor licenses without any discretion or apparently without any extenuating circumstances or defenses other than a violation of §16A. Accordingly, all licensees would want to take great care in accurately filling out and submitting their annual license renewal forms.