Andres Toledo, General Partner of and D/B/A Plaza De Toros La Herradure v. Texas Alcoholic Beverage Commission

In The Court of Appeals Ninth District of Texas at Beaumont ____________________ NO. 09-01-209 CV ____________________ ANDRES TOLEDO, GENERAL PARTNER, d/b/a PLAZA DE TOROS LA HERRADURE, Appellant V. TEXAS ALCOHOLIC BEVERAGE COMMISSION, Appellee On Appeal from the 221st District Court Montgomery County, Texas Trial Cause No. 01-04-02415-CV O P I N I O N Plaza De Toros "La Herradure," a partnership, acting through its general partner, Andres Toledo, applied for a beer retailer's on-premise license and an on-premise "late hours" license. The county judge, acting as an administrative law judge for the Texas Alcoholic Beverage Commission ("TABC"), denied the application. Andres Toledo, doing business as Plaza De Toros "La Herradure" ("Toledo"), appealed to the district court, which affirmed the denial. Toledo appeals, bringing three issues. When approving or rejecting an application for an alcohol license, a county judge is acting administratively as part of the review process of the Texas Alcoholic Beverage Commission ("TABC"). See Lindsay v. Sterling, 690 S.W.2d 560, 562 (Tex. 1985). Both the district court's and our review of final orders issued by the TABC are governed by the substantial evidence rule. See Tex. Alco. Bev. Code Ann. §§ 11.67(b), 61.34(a) (Vernon 1995); Lindsay, 690 S.W.2d at 562. Here, Toledo applied for a beer and liquor license for a rodeo his partnership operates. Toledo testified his rodeo and dances are conducted on twenty-one acres of land, which includes approximately five acres for parking. Toledo planned to sell alcohol or beer only on Sundays. Prior to the hearing, Toledo had conducted the rodeo only three times. Toledo further testified as to his good character and that of his partners. He also testified that he had obtained a building permit and a septic permit and that there would be male and female restrooms at the rodeo. Nine persons testified at the hearing in opposition to Toledo's application. In the first issue, Toledo asserts that his procedural, statutory, and due process rights were violated at the application hearing because the county court admitted hearsay testimony over his objections and failed to swear witnesses. (1) In his hearsay argument, Toledo complains of the admission into evidence of seventy one letters of protest. Contending his ability to cross examine these complainants was being frustrated, Toledo objected to the letters as hearsay. In support of his argument, Toledo cites this court's decision in Lubbock Radio Paging Serv., Inc. v. Southwestern Bell Tel. Co., 607 S.W.2d 29, 32 (Tex. Civ. App.--Beaumont 1980, writ ref'd n.r.e.)("The hearsay rule is applied in the same manner in proceedings before an administrative agency as in trials before a court."). While the TABC acknowledges that the letters were hearsay, the agency asserts Toledo cannot show the error probably caused the rendition of an improper judgment as required by Rule 44.1 of the Texas Rules of Appellate Procedure. See Owens-Corning Fiberglas Corp. v. Malone, 972 S.W.2d 35, 43 (Tex. 1998)("Moreover, we will not reverse a trial court for an erroneous evidentiary ruling unless the error probably caused the rendition of an improper judgment."). As recently reiterated by the Texas Supreme Court, we review the entire record to determine if the excluded or admitted evidence probably resulted in the rendition of an improper judgment. See Texas Dep't of Transp. v. Able, 35 S.W.3d 608, 617 (Tex. 2000). Here, the record shows that several of the letters admitted over Toledo's objectionswere written by persons who also testified. Toledo, thus, had the opportunity to cross- examine those opponents. As to the remaining protest letters contained in Exhibit One, our review finds that all are form letters, except for one letter written by a non-testifying person. The protestors employed two different form letters. Over fifty used one form, while less than a dozen used another. The larger number of protestors using the first form letter complained that "the sale of alcohol for consumption on premises will adversely affect the neighborhood in which [we] live." They noted that "[a] bar in the middle of a residential neighborhood is unconscionable as it threatens the general welfare of the families living in the immediate area and breaches their peace, morals, and sense of decency." These protestors requested that the county court consider the welfare of homeowners and families in their "small neighborhood" and reject the application. The protestors using the second form letter complained that approving the licenses "would have a negative impact on the quality of life in our community. This is a residential neighborhood with many families. We do not want this kind of establishment in our area." The sole person who filed a "non-form" letter, but did not testify, wrote that she and her family moved to their home to get away from the drugs, traffic and alcohol found in Houston. She feared that alcohol's being sold in her neighborhood would increase the risk of "drunks running up and down our roads causing chaos and doing property damage." She also noted that the "road is curvy and there is the possibility of wrecks and hitting our children as they play, ride bikes or horses." Among those testifying was Rose Simmons, who complained of noise and stated, "It's a very dangerous road." She feared drunks might kill one of her children or grandchildren or destroy her property. Bo Grimes testified that the excessive number of cars and the drinking would make it dangerous to travel on Pioneer Lane. Susan Harger expressed her concern about the curves in the road and the potential danger to the neighborhood's children, who ride bicycles on the road. She also complained about the loud noise, and further stated that the applicants were violating their contract of sale. Tommy Knight testified he was concerned for the children riding bicycles because of the excessive traffic that would occur. He stated that the residents did not want alcohol in their neighborhood. Jerry Vincent testified that the children would be in more danger if alcohol were sold. He stated that the area was a residential neighborhood, and the street was not a business thoroughfare. He requested that the safety and welfare of the area's families be put first. Jennifer Grimes reiterated that the residents enjoyed a "family-type" neighborhood. She expressed concern regarding the effect of increased traffic on the safety of the children and the residents who walked and jogged along the road. She also was concerned about drunk drivers, the possible increase in crime, and noise. Others who testified expressed concerns about the appropriateness of the buildings for the planned activities. Having reviewed the entire record, we find that admission of the letters probably did not result in the rendition of an improper judgment. See Able, 35 S.W.3d at 617. To show harm, the evidence must be controlling on a material issue and not cumulative of other evidence. See Williams Distrib. Co. v. Franklin, 898 S.W.2d 816, 817 (Tex. 1995). Because appellant does not explain how the judgment turns on the letters that were admitted over his objection, Toledo does not satisfy the first prong of a successful evidentiary challenge. See Able, 35 S.W.3d at 617 (citing City of Brownsville v. Alvarado, 897 S.W.2d at 750, 754-55 (Tex. 1995)). In addition, our review of the record finds the admitted letters to be cumulative of testimony presented during the hearing. Toledo's hearsay challenge is overruled. Toledo's additional complaint in issue one is that witnesses testified without first being sworn. However, he does not provide record references demonstrating he preserved this error, nor does our review of the record find it was preserved. Moreover, Toledo himself was not sworn before testifying at the hearing on his license application; only his interpreter was sworn. In addition, Toledo's counsel cross-examined several of the unsworn witnesses. By not objecting to the county court's failure to administer the oath to witnesses, Toledo waived any objections he has. See Banda v. Garcia, 955 S.W.2d 270, 272 (Tex. 1997); Tex. R. App. P. 33.1(a)(1)("As a prerequisite to presenting a complaint for appellate review, the record must show that the complaint was made to the trial court by a timely request, objection, or motion . . .."). Toledo's unsworn testimony challenge is overruled. Issue one is overruled. In his second and third issues, Toledo contends the county judge made findings, that are not supported by substantial evidence and are not sufficient to deny the application under the law. Under the substantial evidence rule that sets the standards for our review, the record evidence may preponderate against the county judge's decision but still amount to substantial evidence, so long as it is more than a scintilla. See Bavarian Properties, Inc. v. Texas Alcoholic Beverage Comm'n, 870 S.W.2d 686, 688 (Tex. App --Fort Worth 1994, writ denied). Further, the county judge's findings, inferences, conclusions, and decisions are presumed to be supported by substantial evidence, and the burden is on the complaining party to show that they are not. See Texas State Bd. of Dental Examiners v. Sizemore, 759 S.W.2d 114, 116 (Tex. 1988). Based on the evidence introduced, we are to determine whether reasonable minds might have reached the same decision that the county judge did. Texas Alcoholic Beverage Comm'n v. Sierra, 784 S.W.2d 359, 360 (Tex.1990). In other words, "[t]he true test is not whether the agency reached the correct conclusion, but whether some reasonable basis exists in the record for the action taken by the agency." See Texas Health Facilities Comm'n v. Charter Medical-Dallas, Inc., 665 S.W.2d 446, 452 (Tex. 1984). On February 27, 2001, the county court stated two reasons in denying Toledo's application: (1) "the place or manner in which the applicant . . . may conduct his business warrants a refusal based on the general welfare, health, peace, morals, safety, and sense of decency of the people[,]" (citing section 61.42(a)(3) of the Texas Alcoholic Beverage Code); and (2) "the applicant . . . does not have an adequate building available at the address for which the license is sought before conducting any activity authorized by the license[,]" (citing section 61.43(5) of the Texas Alcoholic Beverage Code). On March 14, 2001, the county court denied the rehearing and further stated his findings that: •the operation of the establishment in the proposed locale would not benefit the general welfare, health, morals, and safety of the people who reside in the area; •the granting of this license would be offensive to the general public's sense of morals and decency; •the granting of the license would create an extremely hazardous traffic condition and expose the residents of the surrounding residential neighborhood and their children to potentially serious bodily harm and injury at the hands of inebriated drivers of vehicles ingressing and egressing the site; •children on bicycles and pedestrian traffic would be at particular risk, which is a particular concern as the neighborhood is exclusively residential, with no other commercial buildings; •one-acre of primitive parking provided for a nineteen-acre site is not adequate; •there is a substantial question as to whether the building itself is safe for occupancy; •granting the license application would constitute a health hazard to both the patrons of such an establishment and to the people who live in the residential area as well because of inadequate sanitary facilities, which would be needed for a large rodeo crowd, and the accompanying potential for the transmission of communicable diseases that can result from inadequate sanitary facilities. Under the Texas Alcoholic Beverage Code, an application for a liquor license shall be denied if the county judge has reasonable grounds to believe and finds that the place or manner in which the establishment is to conduct its business warrants denial based on the general welfare, health, peace, morals, and safety, and sense of decency of the people. See Tex. Alco. Bev. Code Ann. § 61.42(a)(3) (Vernon 1995). In reviewing all the evidence, we find the record provides ample basis for the county judge's findings and its denial of Toledo's application. Issues two and three are overruled. We affirm the district court's judgment, which affirmed the Commission's denial of Toledo's application. AFFIRMED. PER CURIAM Submitted on November 28, 2001 Opinion Delivered January 10, 2002 Do Not Publish Before Walker, C.J., Burgess and Gaultney, JJ. 1. Also in his first issue, Toledo maintains that the county judge failed to rule on each proposed finding of fact Toledo presented as required under section 2001.141(e) of the Texas Government Code. However, we do not consider this argument as Toledo waived it by not including it in his motion for rehearing. See Four Stars Food Mart, Inc. v. Texas Alcoholic Beverage Comm'n, 923 S.W.2d 266, 270 (Tex. App.--Fort Worth 1996, no writ)("Failure to assert a point of error in a motion for rehearing will result in waiver of the error.")