Foodmaker, Inc. v. Alcoholic Beverage Control Appeals Board

Opinion

McCOMB, J. Petitioner seeks review of a decision of the Alcoholic Beverage Control Appeals Board (“board”), which affirmed a decision of the Department of Alcoholic Beverage Control (“department”) revoking liquor licenses which petitioner claimed the right to use and denying petitioner’s applications for transfer of the licenses to it and for issuance to it of a license previously approved for issuance to one of petitioner’s predecessor corporations on completion of certain premises. The action taken by the department and the board was contrary to the recommendation made by the hearing [607]officer, who had issued a proposed decision granting petitioner the relief it sought.

Facts: On October 1, 1970, petitioner became the successor by merger to Foodmaker Commissary, Inc. (“FCI”). Prior to that time, FCI was wholly owned by Foodmaker, Inc. (“FI”), a corporation which had the same name as petitioner now has. FI, in turn, was owned 99.96 percent by Ralston-Purina Company, which also owned 100 percent of the stock of Checkerboard Properties, Inc. (“CPI”). In the reorganization which took place on October 1, 1970, Ralston-Purina Company transferred all its shares in FI to CPI, which by that time had acquired the remaining 0.04 percent of the stock in FI; and FI merged into CPI, which thereupon changed its name to Foodmaker, Inc. FCI was then merged into the newly constituted Foodmaker, Inc. (petitioner herein).

At the time of the reorganization, which was effected to streamline the operations of Ralston-Purina Company and its subsidiaries, FCI was the owner of certain licenses issued by the department. On February 18, 1970, the department had issued to FCI, for premises located at 2040 Harbor Island Drive in San Diego, a Type 21 off-sale general license, a Type 47 on-sale general license for bona fide eating place, and a duplicate of the latter license. Said licenses were issued as priority licenses under sections 23800-23805, 23816, 23817, 23820, 23821, and 24070 of the Business and Professions Code.1

On January 7, 1970, FCI had applied by letter for a new priority on-sale general license for bona fide eating place for premises to be located at 5404 Balboa Avenue in San Diego; and it was notified by the department on February 26, 1970, that its application had been approved for issuance of the license upon completion of the premises.

On December 8, 1970, petitioner applied to the department for transfer to it of FCI’s licenses covering the premises at 2040 Harbor Island Drive.2