What Is The Effect of Prior Negative History on Liquor Licensing?

When attempting to obtain an on-premise liquor license for your establishment, the first hurdle is often your local community board.  Unfortunately, it is well known within the nightlife community that such committees often include self-appointed community activists whose sole purpose is to derail your plans by citing any of a dozen reasons explaining why they choose to vote against approval of your license.  Often times, some of the reasons provided are based on mere speculation.  For example, the objection may be based on the operation of a previous owner.  The previous owner may have operated the establishment in such a manner so that it became a public nuisance.  It may have formerly been a magnet for drug trafficking, stabbings, and even shootings. It may have received numerous violations involving sales to minors, unlicensed security, purchases of liquor from unauthorized vendors, etc.  The disfunctional operation of a previous owner should not be imputed on a new liquor license applicant.

Courts have supported this line of reasoning.  In 1995, a bar named The Buzz was denied an on-premise liquor license by the SLA because it argued the public interest would not be promoted by the issuance of the license due to the history of liquor violations and reported criminal activity at the location.

The court overturned the decision of the SLA denying the license, holding that the prior history of the premises, standing alone, especially without a showing of an ownership interest between applicant and the former owner of the premises, was insufficient to warrant disapproval of the application.  Moreover, there was no factual support that the prior history of the premises created a degree of risk that would be continued by the applicant’s operation of its bar.

Citation: Matter of 512-3rd St., d/b/a The Buzz v. New York State Liquor Authority, 217 A.D.2d 1010 (1995).