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Division of Alcoholic Beverage Control v. MAG Entertainment


November 14, 2008


On appeal from the Division of Alcoholic Beverage Control.

Per curiam.


Argued September 15, 2008

Before Judges Reisner, Sapp-Peterson and Alvarez.

MAG Entertainment, L.L.C. t/a Cheerleaders (MAG, the bar or the licensee) appeals from a September 11, 2006 final decision of the Director of the Division of Alcoholic Beverage Control (ABC), and from the Director's December 21, 2007 decision on reconsideration. We affirm the finding of a regulatory violation, modify in part as to the penalty imposed and remand for further proceedings consistent with this opinion.


A. Background

This case arises from a fatal automobile accident in which Humberto Herrera-Salas (Herrera) left a bar known as Cheerleaders, turned the wrong way down a divided highway adjacent to the bar's parking lot and struck an oncoming car head-on, killing two people. The ABC Director revoked the bar's alcoholic beverage license, on the theory that the bartender had served Herrera while he was intoxicated, in violation of N.J.A.C. 13:2-23.1(b),*fn1 and that the bar personnel had then ejected him from the premises without taking sufficient precautions to make sure that he did not drive. In response to a motion for reconsideration, the ABC Director gave MAG siX months to sell the liquor license in lieu of revocation, provided the owners could also reach a settlement with the agency to pay a monetary penalty.

The following evidence was produced at the hearing before the Office of Administrative Law.

B. The Events Preceding Herrera's Arrival At Cheerleaders

In April 2000, Herrera was 23 years old, 5 feet 3 inches in height, and weighed approximately 135 pounds. According to his testimony, he began drinking alcohol at the age of eighteen and, for the next five years up until around the age of twenty-three, he would normally drink only two to three beers a month.

On the morning of April 15, 2000, Herrera felt tired and decided to purchase alcohol rather than going to work. By 11:00 a.m., Herrera had already consumed two beers while watching television. Herrera may have cooked eggs for himself around noon, although he was not sure he ate anything.

At around 4:30 p.m., Herrera left his house to pick up his brother and sister-in-law from their place of employment. On his way there, Herrera spotted his friend Robles walking. They decided to purchase alcohol and return to Robles' house. At the liquor store, Herrera bought a twelve pack of light beer, and Robles bought a twenty-four pack of light beer.

They arrived at Robles' home at approximately 5:00 p.m. Herrera initially testified that he drank three beers in total. Later in his testimony, however, Herrera was presented with his deposition from a previous civil case, where he testified that he actually drank anywhere from five to eight beers at Robles' house. In response, Herrera indicated that he might have consumed five to eight beers because he drank three of his, plus some that Robles gave him.

At around 10:00 or 11:00 p.m., Robles and Herrera left Robles' house to get something to eat at a restaurant in Camden. It was closed, however, and they decided to purchase a six pack of beer instead. Herrera testified that he drank one beer. Robles then suggested that they go to a bar, and Herrera drove them to Cheerleaders in Gloucester City. At this point, Herrera testified, he was "a little bit dizzy but [he] could drive."

C. Inside Cheerleaders

Herrera and Robles arrived at Cheerleaders, a gentlemen's club, sometime between 10:30 and 11:00 p.m. According to Herrera, he felt "almost normal" as he walked in. In a recorded statement, the Cheerleaders' doorman, Mark Vogeding, opined that Herrera and Robles did not appear to be intoxicated upon entering.

At the hearing, differing accounts were presented concerning what happened inside Cheerleaders. According to Herrera, he sat at the front of the bar with Robles, and they each consumed three beers. After that, Herrera switched to tequila and drank three shots. Robles and Herrera then relocated from the front of the bar to a table, where Herrera drank two more beers. According to Herrera, he "[n]ever drank like that" before this night at Cheerleaders. He testified that on that day, he "crossed the limit." Herrera further testified that at no time did any Cheerleaders bartender refuse to serve him a drink when requested or take any drinks away.

While Robles was in the bathroom, Herrera began observing a woman dancing. When he began to feel dizzy and tired, Herrera lowered his head onto the table for a while. He then raised his head and resumed observing the woman. At this time, Herrera noticed a man staring at him. An argument ensued after Herrera asked the man what he wanted, and Cheerleaders' security escorted Herrera out of the tavern.

Cheerleaders personnel present in the club on the night in question gave a somewhat different version of events. According to Laura D'Amico, a Cheerleaders bartender, in her opinion, Robles and Herrera were not intoxicated when they first entered Cheerleaders. Throughout the course of the night, they each had approximately three beers and three shots of tequila. D'Amico testified that at no point while she was serving Herrera drinks, did she believe he was intoxicated.

Shortly after serving the third round, D'Amico observed one of the two men with his head down on the bar*fn2 falling off the stool. Contrary to Herrera's testimony, D'Amico insisted that she "flagged" Herrera and Robles at this point, meaning that she refused to serve them any more alcohol. She testified that she also took away the two shots and two beers that had been on the bar in front of the men. When Herrera indicated that he would be driving home, D'Amico told him that she would call a taxi. However, she did not immediately call the taxi, because she had to assist the other bartender who was extremely busy across the bar.

Meanwhile, Isiar Jazmin Gauatt (Jazmin)*fn3 , a Cheerleaders dancer, observed Herrera and Robles sitting next to each other at the bar while she was dancing on stage. Herrera was slumped over with his head down and his eyes open. According to Jazmin, he "was not coherent to what was going on around him . . . and was not paying attention to his surroundings." Therefore, when she began approaching customers for tips, Jazmin skipped over Herrera and approached Robles, who proved to be "obnoxious and grabby." She pushed his hand aside, and then proceeded to dance for other customers.

While Jazmin was changing after her shift, another dancer, Jennifer Noval (whose stage name was Apple Pie), entered the dressing room crying. Jazmin saw scratch marks all the way across her stomach, perhaps caused by a ring. According to Apple Pie, while she was sitting at the bar with a customer, Donald Tucker, awaiting her turn to dance on stage, she observed a Mexican male (Herrera) sitting around the corner of the bar "passed out . . . with his eyes closed [and] head down." According to Tucker, while he was speaking to Apple Pie, his back was to Herrera, who was approximately eight feet away.

Suddenly and without provocation, Herrera walked over to Tucker and struck him in the back of the ribs, causing Tucker and Apple Pie to fall off their chairs. Herrera also hit Apple Pie, "like a sideswipe across" her stomach. Herrera then picked up a chair but was quickly restrained from behind by the barback, Jeremy Whitman, who had observed Herrera knock Tucker down. The barback escorted Herrera outside in a "bear hug," with the help of John Zerggen the cook, and the doorman.

At this point, D'Amico, who testified she was unaware of the entire incident, finished assisting the other bartender and moved toward the telephone located in the middle of the bar. She picked up the phone and dialed the number of a taxi company. Before someone answered, D'Amico looked over at Robles and Herrera to get a description to relay to the taxi operator. To her surprise, she saw Christopher Ginty, the manager, speaking to a thin man whose description corresponded to Herrera. The other man was not in sight. Knowing something was wrong, D'Amico hung up the phone and approached the manager, who told her that he would call a taxi.

The Cheerleaders employees had differing opinions on the state of Herrera's intoxication when he was ejected from Cheerleaders. Each employee was asked to rate Herrera's intoxication on a scale of one to five, with one being slightly tipsy, and five being totally inebriated. Both Jazmin and the cook opined that he was about a five. Jazmin specifically noted that Herrera could not even get up from his seat, while the cook stated that Herrera "wasn't in good shape." D'Amico stated that the man resting his head on the bar was clearly intoxicated and was falling off his stool. Apple Pie believed that Herrera must have been under the influence of drugs based on his actions; his eyes were "crooked" and "squinting". The bouncer had a different assessment, concluding that Herrera was about a three, or "moderately inebriated" and in control of himself. Ginty, the manager, claimed that he did not interact with Herrera enough to establish an opinion regarding his sobriety.

D. Outside Cheerleaders

After ejecting Herrera from the bar, the bouncer, the barback and the cook placed Herrera "on the pavement in front of the front door". Herrera tried to re-enter the bar, but was quickly subdued by the bouncer, who told him to remain outside. The manager went back inside to look for Robles.

At this point, Herrera was left unsupervised, as the bouncer and the cook returned to their posts in the bar. Herrera proceeded to enter the driver's side of his van because he "wanted to go home." According to Herrera, none of Cheerleaders' employees attempted to prevent him from driving, nor did they offer to call him a taxi.

When the manager brought Robles outside, Herrera had vanished. The manager then asked Jazmin, who had just arrived outside after changing, to serve as a translator for Robles, who spoke primarily Spanish. According to Jazmin, Robles could not even stand up on his own; he was "staggering and wobbling". The manager instructed Jazmin to inquire where Herrera had gone. Robles did not respond. Jazmin then asked Robles if he wanted a taxi, to which he responded in the affirmative. The manager reentered Cheerleaders and called the cab company. According to the bouncer, it was customary for the manager to call a taxi for intoxicated patrons, and in this case, the manager had called a taxi for both Herrera and Robles.

After calling a local taxi company, the manager returned and informed Robles that a taxi would be coming shortly, telling Robles to wait outside next to the steps. Jazmin then left Robles hanging onto the handrail and went home. When asked if she believed Robles could transport himself, she responded "[a]bsolutely not." If it were not for the hand rail, Jazmin opined, Robles would have fallen to the ground.

A short while later, before the taxi arrived, Robles walked away from Cheerleaders and joined Herrera in the van. According to numerous eyewitnesses present at the scene, after proceeding slowly through the parking lot in reverse, Herrera accelerated violently and crashed his van into a parked vehicle in the adjacent parking lot, causing its back end to elevate off the pavement. Robles, concluding that Herrera was intoxicated, exited the vehicle, and Herrera drove away.

E. The Accident

The loud crash in the parking lot caused many inhabitants of nearby apartment buildings to run outside. Once outside, they began chasing after the van on foot, yelling "Stop." Nonetheless, Herrera continued to pull out of the Cheerleaders driveway onto Route 130, which at the time had two lanes going northbound, and two lanes going southbound separated by a concrete median divider. Herrera drove past the divider and turned left, going south onto the northbound side. In other words, Herrera was driving on the wrong side of the road, against oncoming traffic. After traveling about a mile, Herrera's van collided head first with a northbound vehicle, resulting in the deaths of the front seat passenger and driver. The two backseat passengers were seriously injured.

F. Police Investigation

The first officer to arrive at the scene at approximately 12:50 a.m. was Patrolman Crothers, who found Herrera trapped inside his vehicle. While trying to remove him, Crothers detected "a strong odor of alcohol coming from his person and his breath." He also found a beer can lying in the street near Herrera's van. Herrera was taken to the hospital by ambulance.

Patrolman Steven Burkhardt arrived at the scene at approximately 12:53 a.m., shortly after Crothers. Burkhardt opined that this was "by far the worst accident that [he had] handled up to that point or since." After fifteen minutes, however, he was dispatched to the site of a hit and run accident at the parking lot of the Chatham Square Apartments on Route 130, adjacent to the Cheerleaders parking lot.

At the Chatham Apartments, several witnesses told Burkhardt that a blue van had backed across the parking lot at a high rate of speed, struck a parked car, and fled the scene heading south on northbound Route 130. Another witness told Burkhardt that Robles was in the witness's apartment, having walked there from Cheerleaders after the hit and run occurred. Robles told Burkhardt that he was drinking with his friend Herrera earlier that evening in Cheerleaders, when his friend was kicked out and left without him. Burkhardt transported Robles to the police station for further questioning, and then returned to the scene of the head on collision. When Burkhardt arrived, he observed that Herrera's vehicle was a blue van that had brown paint on the rear bumper, consistent with the paint color of the vehicle that had been struck in the parking lot.

Sergeant Willie Mahan interviewed several witnesses who were present at Cheerleaders after Herrera smashed into the parked vehicle.*fn4 Donna Gaber, a tenant of an apartment complex adjacent to the bar, informed Mahan that, after hearing a loud crash in the parking lot, she peered out her window and observed Robles urinating. Gaber, Vincent DiCarlo, Mariano Rivera, and Steven Harris all opined that Robles was extremely drunk, incoherent, and could barely stand up. Robles told Rivera that he had been drinking with his friend, Herrera, in Cheerleaders for about four hours before departing. Harris stated that the doorman informed him that he kicked Herrera and Robles out of Cheerleaders because they were both "too drunk."

During the course of the investigation, Sergeant Mahan contacted the taxi company that the manager allegedly called on the night in question. The cab company employee advised him that "there was no record of a request for a cab for Cheerleaders to respond to take anyone."

1. Herrera's Blood Alcohol Content

At the hospital where Herrera was admitted, Crothers directed the medical personnel to provide him with samples of Herrera's blood for testing. According to Crothers, the emergency staff in the trauma unit drew blood from Herrera, placed the vials in a small plastic cup with ice, sealed them, and then handed them to him. Dr. Raja R. Salem, a trauma surgeon at the hospital, testified that this was the normal procedure implemented when asked by policemen to draw blood samples.*fn5

Afterwards, Crothers transported the blood vials to the police station and placed them in an evidence freezer, secured with a lock. Crothers then filled out a chain of evidence custody report form and placed it in the investigator's mailbox. According to the Chain of Custody Information located in the Blood Alcohol Content Analyst Report, Investigator G.E. Clodfelter from the Prosecutor's Office, Crime Scene Unit, turned the samples over to Charles Johnson, a Camden County Medical Examiner's Investigator, on April 17, 2000. The following day at 5:00 p.m., the samples were turned over to Analytic Bio-Chemistries Incorporated for analysis.

The physician who tested Herrera's blood, Theodore John Siek, Ph.D., submitted a certification describing the laboratory analysis he performed. According to Siek, Herrera's blood was analyzed on April 20, 2000, to ascertain the presence of alcohol. Siek performed a gas chromatography test using a gas chromatograph, which is "commonly used in the industry to determine the presence of alcohol in blood samples." The test results "revealed a blood alcohol content of 0.28% by volume."*fn6

G. Expert Witnesses

1. ABC's Expert

Robert J. Pandina, Ph.D., had been the director of the Rutgers University Center of Alcohol Studies for the previous fifteen years. He specialized in psycho-pharmacology, or the study of how alcohol and other drugs affect the body and the brain and how they affect behavior.

The ABC retained Pandina to: (1) determine whether Herrera was intoxicated while he was at Cheerleaders on the night in question; (2) extrapolate Herrera's BAC at various points in the evening commencing at 6:30 p.m., up until the accident, including what signs or symptoms Herrera would likely have exhibited in accordance with his projected BAC; and (3) determine if Herrera was intoxicated at the time of the accident, and "if so[,] what role his intoxication played." Pandina defined "symptoms" as what an intoxicated person feels in relation to his BAC, and "signs" as what "other people may observe of you relative to the" BAC.

a. Extrapolation

An extrapolation, according to Pandina, is a scientific method that allows for the construction of a "dose curve," or a graph depicting what a person's BAC was at any given particular moment in time. In order to formulate an extrapolation of Herrera's BAC, Pandina relied on the following scientific principles: (1) once alcohol is consumed, the BAC elevates at an average rate, and then peaks in approximately forty-five minutes to an hour, also known as the absorption rate; (2) after peaking, the alcohol in one's blood metabolizes and decreases at a rate of approximately 0.015% per hour, also known as the metabolism rate. In other words, "a person loses .015 percent of the alcohol [consumed] in about an hour."

Pandina testified about the percentage of the population that experiences physiological effects after consuming alcohol in relation to a specific BAC. Generally, at 0.10%, 40% of the population would exhibit visible signs of intoxication; at 0.14%, over 60-65% of the population would exhibit visible signs of intoxication; at 0.15%, 85% of the population would exhibit visible signs of intoxication, including, but not limited to, the general onset of sedation, stumbling of speech, and lack of coordination; at 0.20%, 96-97% of the population would exhibit visible signs of intoxication; at 0.25%, virtually everyone would exhibit visible signs of intoxication; and at 0.40%, over 50% of the population would either be in a coma or dead. Notwithstanding these statistics, however, Pandina indicated that there were reports of certain persons who did not show visible signs of intoxication at 0.20% and even 0.40%, although at this level it is quite rare, about one in 300,000-400,000 people.

To formulate an extrapolation of Herrera's BAC, Pandina took into consideration Herrera's age at the time of the accident (23), his body weight (135 pounds), his gender (male), and the type of alcohol consumed (combination of light beer and tequila shots). The starting point of Dr. Pandina's analysis was Herrera's BAC of 0.28% taken at about 2:00 a.m. on April 16, 2000, the early morning of the accident. From this value, Pandina "worked backwards" to calculate Herrera's BAC during other points in time, incorporating available objective information.

First, Pandina calculated Herrera's peak BAC. To arrive at this value, Dr. Pandina assumed that Herrera did not consume alcohol after 12:15 a.m., around the time when the bartender testified that she "flagged" him. As indicated, once alcohol is consumed, the BAC elevates at an average rate and then peaks in approximately forty-five minutes to an hour. Incorporating this figure, Dr. Pandina concluded that Herrera's BAC peaked around 12:45 to 1:00 a.m., in close proximity to the accident. It follows, therefore, that when Herrera's BAC was measured at 2:00 a.m., it was falling. At its peak, adding 0.015% in order to account for alcohol that had been metabolized at a rate of 0.015% per hour as indicated above, Herrera's BAC was 0.295%, an extremely high level of intoxication.

Next, Pandina determined Herrera's BAC when he first arrived at Cheerleaders around 10:30 p.m. Since there was conflicting testimony regarding the precise number of drinks Herrera consumed prior to arriving at Cheerleaders, Pandina analyzed several different scenarios. If Herrera consumed nine light beers, or some combination of drinks with equivalent alcohol content, at a steady rate commencing at 6:30 p.m., Pandina opined that his BAC would have been around 0.18% when he entered Cheerleaders, give or take 0.01%. If, on the other hand, Herrera only consumed five or six beers beforehand, his BAC would have been around 0.10% upon entering Cheerleaders.

However, assuming Herrera drank three beers and three shots within Cheerleaders as he testified (or six drinks), Pandina explained that Herrera could not have reached a peak BAC of 0.295% by drinking only five to six beers from 6:30 p.m. to 10:30 p.m. Using these figures, it would have been necessary for Herrera to have consumed eight or nine drinks inside Cheerleaders, a figure which is not supported by the record. On the contrary, consuming nine beers before entering and six drinks afterwards coincides with Herrera's peak BAC of 0.295%.

Under any of these scenarios, Pandina concluded that Herrera was legally intoxicated when he entered Cheerleaders.

Finally, when Herrera was served his last order of drinks at around 11:15 p.m., according to Dr. Pandina's extrapolation, Herrera's BAC was about 0.26%. When asked whether Herrera would have shown signs or symptoms of intoxication around this time but prior to lowering his head onto the bar, Pandina responded in the affirmative. He testified that, "[v]isible signs and symptoms are reliably detectable in the majority of individuals when BAC levels reach [0].15%." At 0.26%, Herrera would have had to have been in a group comprising less than 3% of the population in order not to demonstrate signs of intoxication.

Significantly, Pandina opined that

[i]ntoxication is not an all or nothing phenomena. We don't start with a person who is not intoxicated and then at some point falls off the edge of a table is intoxicated

You would consider that type of somnolence [laying one's head onto a bar] a more extreme form of -- the more extreme [indicia] of intoxication. So . . . he certainly would have had difficulty in doing other motor tasks, slurring his words, fumbling for money, falling off stools, difficulty walking, general sensory demeanor that a person at that blood alcohol level has in just conducting themselves even in bar room settings.

On cross-examination, Pandina was instructed to assume that in the five years prior to the accident, Herrera frequently consumed eight beers and three to four shots of tequila without exhibiting sign of intoxication. This assumption was based upon a certification from Robles that Herrera could drink heavily without showing signs of intoxication. Using this hypothetical, MAG's counsel asked Pandina whether Herrera would have acquired a tolerance for alcohol. Pandina responded that if indeed that history were accurate and stayed consistent up until the date of the accident, Herrera could have developed a tolerance.

Pandina, however, rejected the assumption that Herrera could have had a high tolerance for alcohol, based on inferences that could be drawn from his behavior throughout the night. He opined that if Herrera were one of those rare people who do not show visible signs of intoxication at 0.20% or even rarer, 0.40%, he would not "expect Mr. Herrera to drive away, back into a car, immediately go down a one way street the wrong way and hit someone head on. If his tolerance was so great, you would not expect that level of impairment in his driving behavior."

Pandina also recalled reports from patrons at Cheerleaders rating Herrera, when his head was pressed against the bar, a five on a scale of one to five, with five being totally inebriated. Based on this evidence, Pandina inferred that it was not likely that Herrera went from no visible signs of intoxication, or a zero, to a five, without showing intermittent signs, especially considering the extreme BAC Herrera reached at his peak.

I don't think you go from a one[,] no signs of intoxication[,] to a five without showing stages in between, at the point they observed [Herrera] at or about the time he had his head down, they rated him to be a five. I believe he would have had[,] given those circumstances in this case, he would have shown visible signs earlier than that point in time.

I don't believe you go from a zero to a five. Particularly within his blood alcohol range. We're not just talking about a [0].15 or a [0].20. We're talking about a guy who had to have a [0].25 and then drink more before he could reach the ultimate blood alcohol level of [0].295 that he reached in my extrapolation.

2. MAG's Expert

To refute the testimony of Pandina, MAG presented its expert witness, Dr. Stanley Broskey. Broskey has a Ph.D. degree in chemical dependency,*fn7 and was an analytical chemist for forty-four years and a forensic toxicologist for thirty-six years. At the time of his testimony, Broskey was self-employed as a forensic chemist, toxicologist, and criminalist, appearing exclusively on behalf of defendants as a forensic scientist and witness for the previous thirty-one years. He testified on issues such as potential errors in DWI/DUI breath, urine, and blood cases, and acquired human tolerance and resiliency to alcohol or drugs.

Broskey began by giving a general overview of acquired tolerance. He described acquired tolerance as follows:

Essentially, your body has been conditioned, and your liver knows how to get rid of it, how to get it out of your system, and just everybody knows somebody in their family or in their acquaintance or friends who remarkably can drink a lot and not show any symptoms . . . after drinking copious amounts of alcoholic beverages . . . in a very short period of time.

For this reason, Broskey concluded, persons with an acquired tolerance can walk into a tavern with a BAC of 0.20%, 0.25%, or 0.30% and not display any visible signs of intoxication.

MAG's counsel then asked Broskey to assume the following facts: pursuant to Robles' certification, Herrera frequently drank eight to twelve beers and three to four tequila shots without showing visible signs of intoxication; Herrera entered Cheerleaders at 10:30 p.m. on April 16, 2000, with a BAC of 0.10%; and afterwards, Herrera was treated at a hospital for potential alcohol withdrawal and alcoholism. Based on these assumptions, Broskey was asked whether Herrera had an acquired tolerance. Broskey opined that Herrera indeed "had acquired great tolerance for alcohol," and that it would not have dissipated to any great extent even if, as Herrera testified, he had refrained from drinking alcohol for two weeks before the accident. His conclusion was based on Herrera's ability to successfully drive from Robles' home to Camden and then to Cheerleaders, followed by walking into Cheerleaders without showing any visible signs of intoxication, even after drinking large amounts of alcohol. His opinion was further based on Herrera's alleged extensive drinking history, adding that a tolerance for alcohol can be acquired fairly quickly.

Based on Herrera's acquired tolerance, Broskey first concluded that when Herrera entered Cheerleaders with a BAC of 0.10% as Pandina found, he did not exhibit visible signs of intoxication. Broskey further opined that based on Herrera's acquired tolerance, Herrera would not have shown visible signs of intoxication up through when he was served his third and final round of drinks, at which point, according to Pandina's analysis, his BAC was around 0.19%. According to Broskey, persons with an acquired tolerance "have to be significantly above 0.20[%] before you even start to see any symptoms." In further support of his conclusion, Broskey opined that an individual who is merely sitting on a bar stool would be less inclined to exhibit visible signs of intoxication when compared to someone performing complex tasks.

3. Rebuttal

In rebuttal testimony, Pandina characterized Broskey's position as "extreme," when compared to the general view of experts within their field. Pandina also criticized the manner in which Broskey performed the experiments upon which he based his conclusions about tolerance to alcohol. According to Pandina, the tests Broskey employed are inaccurate and may lead to false negatives. Broskey only gave the subjects one type of sobriety test. Pandina testified that this was an inappropriate methodology because certain persons may be non-reactive, or not "sensitive," to that procedure. It is more appropriate to administer multiple tasks, as done by police officers during road sobriety checks.

Pandina also disputed Broskey's conclusion that Herrera had acquired a high tolerance for alcohol. Pandina agreed that during excessive exposures to alcohol, the liver begins to increase its production of enzymes that break the alcohol down. However, contrary to Broskey's conclusion, after a period of alcohol abstinence, even as little as several days, "the enzyme systems begin to, in a sense, relax."

H. Administrative Law Judge's Decision

At the conclusion of the hearing, the ALJ issued his initial decision, finding that Cheerleaders served alcohol to Herrera while he was visibly intoxicated. In reaching this conclusion, the judge rejected Broskey's testimony, reasoning that his opinions conflicted with Herrera's credible testimony that he never drank in the past as much as he had on the night in question. Further, Broskey had not actually tested Herrera, thus undermining his supposition that Herrera had an acquired tolerance for alcohol.

The ALJ also based his decision on the following pertinent findings of fact. On the date in question, Herrera drank two beers from 11:00 a.m. to noon. From 5:30 p.m. to 10:30 p.m., Herrera drank six to ten beers. When he arrived at Cheerleaders at around 10:30 p.m., his BAC was approximately 0.18%. At the tavern from 10:30 p.m. to 12:30 a.m., Herrera consumed three beers and three shots. Afterwards, Herrera lowered his head onto the bar, and then proceeded to assault another patron who was looking at him strangely. He was forcibly escorted from the bar around 12:30 a.m. At this point in time, Herrera's BAC was 0.28%. No Cheerleaders employee called him a taxi, nor was he supervised after he was taken outside. After Robles exited Cheerleaders, he entered the van with Herrera driving. Herrera slammed into a parked vehicle, causing Robles to exit the van. Herrera exited the parking lot and turned left (south) onto the northbound lane of Route 130, resulting in a head on collision with a northbound vehicle, in which the two front passengers were killed and the two backseat passengers were critically injured. At the time of the accident, Herrera's BAC was 0.295%. The ALJ recommended that the Director revoke MAG's liquor license due to the seriousness of the violation and its fatal consequences.

I. Director's Final Decision

In his Final Decision, the ABC Director adopted the ALJ's findings of fact, with the following exception. The Director rejected the finding that Cheerleaders had failed to phone a taxi for Herrera; he based this on the decision of the judge who had presided over Herrera's criminal sentencing. In imposing a twenty-two year sentence, the judge noted that Herrera had refused to wait for the taxi that had been called for him. The Director concluded, however, that even if the bar employees had called a taxi, they had done so because they had observed Herrera's intoxication and inability to operate a vehicle. More significantly, after escorting Herrera from Cheerleaders, the employees left Herrera unsupervised and failed to call the police or otherwise intervene, even after the accident in the adjacent parking lot.

Indeed, by MAG's own admission, its employees had forcibly removed Herrera from Cheerleaders after he became drunkenly violent and abusive, and left him unattended in the parking lot. They did not pay any attention to him, did nothing to stop him from getting into his car, intentionally turned a blind eye to his erratic driving in the adjoining parking lot where he backed into a car, and did nothing to stop him before he drove the wrong way down a major divided highway killing two people, and injuring two others.

The Director rejected MAG's contention that there was no evidence establishing that Herrera had exhibited visible signs of intoxication prior to being "flagged" by the bartender. According to the Director, "[t]he basic fact which is uncontroverted, and which [he found] most compelling, is that after Herrera left Cheerleaders[,] he was so drunk [that] he was unable to operate his vehicle." Moreover, although Herrera's testimony fluctuated with regards to the amount he drank (from four to ten beers before arriving, and three to five beers and three to four shots of tequila at Cheerleaders), there was nonetheless ample evidence supporting the conclusion that Herrera consumed a "large quantity of alcohol both before he arrived at Cheerleaders and while he was in the bar."

This finding was also supported by eyewitness accounts. For example, Jazmin, a Cheerleaders dancer, observed that Herrera was "so incoherent that she did not even bother soliciting a tip from him because it looked like it would be a waste of time." Moreover, on a scale of one to five, she rated Herrera's level of intoxication a five. Another dancer, Apple Pie, observed Herrera passed out at the bar with his eyes closed and opined that he was "under the influence of something." The cook described Herrera as "not in good shape" when he escorted him out and also rated him a five. The doorman rated Herrera a three. These observations were significant because, as Dr. Pandina concluded, one does not go from appearing sober to appearing completely inebriated without showing stages in between.

The BAC results in conjunction with Pandina's testimony also supported the conclusion that Herrera exhibited visible signs of intoxication while inside Cheerleaders. In making this determination, the Director rejected MAG's assertion that Pandina's testimony relied exclusively on the BAC test results. Although conceding that Pandina did not personally test Herrera, the Director noted that Pandina also relied on Herrera's own testimony concerning his drinking behavior and the Cheerleaders employees' observations, which the Director opined were legally competent evidence and could "serve as the residuum to support the relevant hearsay evidence."

Finally, the Director rejected MAG's argument, based on Dr. Broskey's testimony, that Herrera would not have demonstrated signs of intoxication due to his acquired tolerance. This argument was founded on Robles' certification that Herrera was capable of consuming eight to twelve beers and three to four shots of tequila and then afterwards, acting and speaking normally without motor function impairment. However, the Director noted that Robles' certification conflicted with Herrera's own testimony that he only sparingly drank with Robles, and that he had never consumed tequila before the night in question, which was the most alcohol he ever drank.*fn8

Additionally, as concluded by Pandina, if Herrera was so tolerant, he would not have slammed into a parked vehicle, then driven down a major highway against traffic for over a mile, ultimately resulting in a head on collision.

1. Penalty

After concluding that Cheerleaders served an intoxicated patron, the Director determined to revoke the bar's license.

In making his determination, the Director cited the following aggravating circumstances. First, the Director noted MAG's "callous disregard for public safety," demonstrated by its acknowledgment that "it knew Herrera was intoxicated when it 'flagged' him." Moreover, after Herrera was ejected from Cheerleaders for drunken and combative behavior, he was left unattended in the parking lot with his car keys in his pocket. He concluded that MAG's "attitude of irresponsibility for a person who became intoxicated on their premises, and who it knew to be driving, is an extreme aggravating circumstance."


On this appeal, the licensee contends that the Director's decision is not supported by sufficient credible evidence and that the penalty is excessive. MAG presents the following points for our consideration:



A. The Evidence Offered Did Not Support The Finding That Herrera Exhibited Signs Of Intoxication At The Time He Was Served

1. The Division's Expert Testified That He Could Not Predict Whether Herrera Would Have Exhibited Signs Of Intoxication At The Time He Was Served.

2. No Evidence Was Offered To Show That Any Person Observed Herrera To Be Intoxicated At The Time He Was Served Alcohol.

B. The ALJ And The Director Committed Reversible Error By Relying On Hearsay In Violation Of The Residuum Rule.

C. The BAC Test Result Did Not Conform To The Requirements For The Admission Of Hearsay Chemical Analysis.

D. The BAC Test Results Were Adversely Affected Due To The Defects In The Chain Of Custody.



A. The Director's Final Decision Overturned One Of The ALJ's Aggravating Factors, But Failed To Adjust The Penalty Accordingly.

B. The Initial And Final Decisions Failed To Address The Mitigating Factors Presented By MAG.

Our review of an administrative agency's factual findings is limited to determining whether they are supported by substantial credible evidence in the record. Division of Alcoholic Beverage Control v. Bruce Zane, Inc., 99 N.J. Super. 196, 199-200 (App. Div. 1968). The agency's decision is entitled to particular deference where the director adopts the credibility determinations of the administrative law judge who heard the witnesses testify. See Clowes v. Terminix, Int'l Inc., 109 N.J. 575, 587-88 (1988); State v. Locurto, 157 N.J. 463, 474 (1999). While hearsay is admissible in administrative proceedings, the agency's findings of fact cannot be based entirely on hearsay evidence; those findings must be supported by a residuum of legally competent evidence. Weston v. State, 60 N.J. 36, 51 (1972); In re Toth, 175 N.J. Super. 254, 262 (App. Div. 1980); N.J.A.C. 1:1-15.5.

Having reviewed the entire record, we conclude that the Director's finding of a violation was supported by sufficient credible evidence. We begin by considering the evidence of Herrera's intoxication. Herrera got into the fatal accident at 12:53 a.m., within minutes after leaving the bar, and a blood sample was drawn from him at the hospital at 2:00 a.m. The blood test showed that he had a blood alcohol level (BAC) of 0.28%, or more than three times the legal limit to drive a vehicle. If the test was accurate, it follows that Herrera was extremely intoxicated when he left the bar.

MAG raises three challenges to the BAC test results: First, it contends that the State failed to establish the trustworthiness of the test results. Second, it argues that, after the State produced a certification from the chemist who performed the test, the licensee was denied the opportunity to examine the chemist. Third, the licensee contends that the test was unreliable because there were defects in the chain of custody of Herrera's blood sample.

To address the last objection first, we find no merit in the chain of custody argument. "Whether the requisite chain of possession has been sufficiently established to justify admission of the exhibit is a matter committed to the discretion of the trial judge, and his determination will not be overturned in the absence of a clearly mistaken exercise thereof." State v. Brown, 99 N.J. Super. 22, 27 (App. Div.), certif. denied, 51 N.J. 468 (1968). We find no mistaken exercise of discretion here. The State produced evidence establishing the chain of custody, beginning with the hospital personnel who drew the blood, to the police officer who took the sample to police headquarters, to the officer who transported the sample to the testing laboratory, and finally to the chemist who performed the analysis. Moreover, even if there had been a defect in the chain of custody it would not have rendered the test results inadmissible, but would only have affected the weight to be accorded the evidence. See State v. Morton, 155 N.J. 383, 447 (1998), cert. denied, 532 U.S. 931, 121 S.Ct. 1380, 149 L.Ed. 2d 306 (2001).

Turning to the first two arguments, we recognize that the State is obligated to provide evidence of the trustworthiness of the blood test results. As the court indicated in R.K. v. Dep't of Human Servs., 215 N.J. Super. 342, 348 (App. Div. 1987):

Ordinarily the report of a chemical analysis is admissible as a trustworthy business entry under Evid. R. 63(13) if evidence is presented of the "'method and circumstances' involved in the preparation" of the report. State v. Matulewicz, 101 N.J. 27, 30 (1985).

However, in a criminal case, a defendant has a Sixth Amendment right to confront and cross-examine the expert who performed the test. As the Court held in a case involving chemical analysis of illegal drugs:

The State's proffer of a certificate whose form and content conform to the statute [N.J.S.A. 2C:35-19] does not itself preclude a defendant's right to confront the certificate's preparer at trial. The statute merely establishes the mechanism by which a trial court ultimately will determine whether a genuine contest exists between the parties in respect of the proffered certificate that would require production of the analyst. [State v. Simbara, 175 N.J. 37, 48-49 (2002).]

See also State v. Matulewicz, 101 N.J. 27, 32 n.2 (1985). In criminal cases, however, there is also a statutorily-established procedure requiring the State to provide defendant appropriate notice that it intends to rely on the test as well as to provide foundational documents supporting the test's validity. N.J.S.A. 2C:35-19. The defendant must object to the admission of the certificate within a strict time deadline, failing which the certificate will be admissible at trial. N.J.S.A. 2C:35-19(c). In State v. Berezansky, 386 N.J. Super. 84, 89-96 (App. Div. 2006), certif. granted, 191 N.J. 317 (2007), appeal dismissed, 196 N.J. 82 (2008), we held that the same procedure should apply to blood alcohol tests in DWI cases:

We recognize that N.J.S.A. 2C:35-19, as well as Simbara and [State v. Miller, 170 N.J. 417 (2002)] literally address only a drug test certificate. We fail, however, to see any reasonable basis for holding the State to a lesser standard, or according a defendant lesser rights, with respect to use of such a certificate as evidence of an essential element of the DWI offense. [Id. at 95.]

Berezansky reasoned that the certificate itself was not admissible as a business record, because it was prepared for litigation purposes, e.g., for purposes of prosecuting the defendant, id. at 94, although it was admissible pursuant to the procedures set forth in N.J.S.A. 2C:35-19. However, if there is an issue concerning the validity of the test, defendant must be given the opportunity to examine the expert who prepared the certificate. See Berezansky, supra, 386 N.J. Super. at 94.

In this case, the State produced the BAC report well in advance of the hearing and was evidently unaware until mid-hearing that respondent was going to object to the report. In response to counsel's objection, the State produced a certification from the chemist who prepared the report. Our review of the record reveals that the certification was marked for identification on the third hearing day, pending respondent's right to cross-examine the chemist, but the certification was never admitted in evidence and the chemist was not produced. Nonetheless, in this case, we conclude that it was not an abuse of discretion for the ALJ to have admitted the BAC report in evidence without the certification.

Unlike a criminal case, in a civil case such as this one, the respondent has the opportunity to conduct pre-trial discovery through interrogatories and depositions. N.J.A.C. 1:1-10.2. There appears to be no dispute that respondent engaged in extensive pre-hearing discovery and discovery motion practice, as well as some unrelated mid-trial discovery. The State provided opposing counsel with a copy of the BAC report in discovery. In this case, the BAC report was a very significant piece of evidence, which was well-known to both sides. In addition to being a proposed exhibit in this case, it had been central to the criminal prosecution of Herrera.

The OAL rules contemplate that the parties will raise significant evidentiary issues prior to the hearing, so as to avoid surprises during the hearing. N.J.A.C. 1:1-13.1, -13.2. If MAG had a genuine concern about the accuracy of the BAC report, it should have raised the issue prior to the hearing. Moreover, while the State should have produced the chemist's certificate prior to the hearing, MAG could have engaged in discovery about the test methods prior to the hearing, including but not limited to deposing the chemist who prepared the report.

In summary, under the circumstances of this civil administrative case we find no abuse of discretion in the ALJ's admitting the BAC report in evidence. That report, plus the manner in which the accident occurred, i.e, Herrera turned the wrong way down a major divided highway and was found reeking of alcohol after the accident, supports an inference that he was heavily intoxicated. See Bauer v. Nesbitt, 399 N.J. Super. 71, 84 n.1 (App. Div.)("[W]e have found that the tortfeasor's manner of driving after leaving the defendant bar may be probative of the tortfeasor's condition while at the bar, depending on the time interval that has elapsed."), certif. granted, 196 N.J. 85 (2008); Truchan v. Sayreville Bar and Rest. Inc., 323 N.J. Super. 40, 51 (1999).

Having concluded that the evidence supported the Director's finding that Herrera was intoxicated at the time of the accident, we continue to look at the evening's events in reverse, turning first to the evidence that Herrera was intoxicated before he drove away from the bar. Immediately before he pulled out into traffic, Herrera drove his van erratically in the parking lot, reversing at high speed and backing into a parked car. Observing Herrera's apparent intoxication, his companion Robles then got out of Herrera's van and declined to ride with him. Robles' testimony at the hearing constituted legally competent evidence of these facts. Recorded statements from other witnesses corroborate that Herrera drove erratically and backed into a vehicle in the parking lot. Further, ABC presented both hearsay and non-hearsay evidence that Robles was very intoxicated (falling-down drunk might be a fair characterization) when he left the bar.

There is also evidence that Herrera was intoxicated when he was in the bar. Eyewitness testimony from Donald Tucker confirms that at some point shortly before Herrera left the bar, he engaged in an unprovoked attack on Tucker, who was peaceably sitting at the bar near Herrera. According to testimony from the bartender, prior to the assault, she had refused to serve Herrera and Robles any more alcohol because, based on her observations, one of them seemed to have collapsed with his head on the bar and the other one was slurring his speech and was otherwise visibly intoxicated. According to the bar manager and the bartender, both of whose statements were legally competent evidence, one or the other of them called a taxi for the men, because they perceived that they were intoxicated.

This brings us to the critical question: whether Herrera was intoxicated before the bartender refused to continue serving him alcohol, and whether signs of that intoxication were observable at the time when she was still serving him alcohol. The State relied heavily on expert testimony from Dr. Pandina. In light of the evidence as to the amount Herrera drank before he got to the bar, and the amount he drank while he was there, plus his observed conduct when he left the bar, as well as his BAC at the time of the accident, Pandina extrapolated that Herrera must have displayed signs of intoxication during the time he was being served alcohol at the bar.*fn9

The ALJ credited Pandina's testimony and did not credit the testimony of the bar's expert, Dr. Broskey, who opined that Herrera probably was sufficiently tolerant to alcohol that he would not have showed signs of intoxication. The Director agreed with the ALJ's assessment. The Director placed particular weight on Dr. Pandina's opinion that, as the Director summarized it, "a person does not go from no signs of intoxication to being intoxicated enough to warrant being 'flagged' without showing stages in between."

Having reviewed the record, we find no basis to disturb the ALJ's and the Director's determinations that Pandina was a credible witness and Broskey was not credible. Unlike Pandina, Dr. Broskey was a professional defense witness, with a Ph.D. from a correspondence school. Moreover, in his rebuttal testimony, Dr. Pandina thoroughly discredited Dr. Broskey's methodology.

We find no error in the ALJ's or the Director's reliance on some hearsay evidence. The ALJ carefully and correctly applied the residuum rule as did the Director. With the exception of the testimony of Herrera and Investigator Marcial, the State's evidence consisted of taped witness interviews, plus expert testimony from Dr. Pandina. The interviews with Ginty the manager, and other bar employees, were legally competent evidence.*fn10 Although Ginty admitted that Robles was intoxicated, he attempted to minimize the extent. Most of the State's other witnesses who observed the men either in the bar or after they were ejected from the premises, indicated that Robles was falling-down drunk and Herrera was also visibly intoxicated. The taped statements were corroborated by the in-person testimony of Marcial, who spoke to Robles right after the accident and found him to be so drunk he was incoherent. They were also corroborated by evidence of Herrera's blood alcohol level at the time of the accident, and by the expert testimony of Pandina.

We also consider the in-person testimony of the person who served Robles and Herrera. The bartender, Lauren D'Amico, was a nineteen-year old who had been working as an exotic dancer at Cheerleaders before she switched to tending bar. At the time of her hearing testimony, she was serving a jail term for her own involvement in a fatal accident. Her testimony was significantly at variance with that of most other witnesses, in that she recalled Robles, not Herrera, as having his head on the bar. She claimed to be unaware of the incident in which Herrera assaulted Tucker, although she was working behind the bar when the incident occurred; she alleged she was helping another bartender at the time. She also claimed to have seen Herrera having a conversation with Ginty the bar manager at a point after the incident when, according to Ginty and Tucker (both of whose testimony constituted legally competent evidence), Herrera had already been hustled out of the bar by the bouncer and other employees.

Significantly, D'Amico admitted that she was standing almost directly in front of Herrera and Robles while they were sitting at the bar and that they spoke to her several times both to order drinks and to flirt with her. She thus had ample opportunity to observe their demeanor and hear their speech. Her claim that she observed no sign whatever that either man was intoxicated is at stark variance with the evidence of both men's very drunken conduct immediately after they left the bar, as well as with Herrera's elevated BAC. According to D'Amico, she only flagged the men after she saw Robles put his head down on the bar. She also testified that she had never flagged anyone before she allegedly flagged Herrera and Robles on this occasion. Based on our review of the record, we find no basis to disturb the ALJ's and the Director's determinations not to credit her testimony. Circumstantial evidence strongly supported the conclusions that Herrera was visibly intoxicated when D'Amico served him and that she knew or should have known that he was intoxicated. See Benedetti v. Trenton Bd. of Commissioners, 35 N.J. Super. 30, 34 (App. Div. 1955).

Despite ample evidence of a violation, MAG argues that the Director improperly held MAG to a standard of "strict liability" and that the Director could not find a violation of N.J.A.C. 13:2-23.1(b) based on circumstantial evidence. We reject these contentions.

The ABC regulations strictly prohibit a licensee from serving intoxicated or "apparently intoxicated" persons. N.J.A.C. 13:2-23.1(b). The regulation requires bar employees to be vigilant in detecting intoxicated patrons and to make inquiries if there is any uncertainty about a patron's possible intoxication:

When used in conjunction with the words "actually intoxicated," we believe the language challenged provides a sufficiently understandable description of the conduct of persons to whom sale of alcoholic beverages is forbidden. The term "apparently" refers to the observable manifestations or symptoms of excessive indulgence in alcoholic beverages. It portrays a person so far under the influence of alcoholic beverages that his conduct and demeanor have departed from the normal pattern of behavior. To require proof that the patron is "actually intoxicated" may well place an undue burden upon the Director in carrying out the legislative mandate. Nor does this language place the tavern keeper or his employees in any dilemma by being compelled to make a doubtful decision. They may always make suitable inquiries when a person appears to be intoxicated to verify either that he is intoxicated or has reached a point where he ought not to be served alcoholic beverages. [Div. of Alcoholic Beverage Control v. Zane, 99 N.J. Super. 196, 201 (App. Div. 1968).]

In this case, we need not decide whether the regulation creates a rule of "strict liability," nor the precise contours of such a rule if it exists. While our courts have explicitly found strict liability with respect to regulations prohibiting the sale of illegal drugs on a licensed premises, Div. of Alcoholic Beverage Control v. Maynard's, Inc., 192 N.J. 158, 161 (2007), and service to minors, Essex Holding Corp. v. Hock, 136 N.J.L. 28, 31 (Sup. Ct. 1947), neither side has cited to any authority directly addressing whether the regulation against serving intoxicated patrons is a rule of strict liability.

In Div. of Alcoholic Beverage Control v. Stevens, 5 N.J.A.R. 141 (ABC 1981), the Director adopted an initial decision in which the ALJ concluded that the bartender in fact served an intoxicated patron, but exonerated that licensee because the signs of intoxication were not visible to the bartender at the time of service. The ALJ found that the sale to the patron took at most half a minute, and the agency did not prove "that the bartender observed the manifestations of apparent intoxication to such a point where he would be required to make the 'suitable inquiry' detailed in Zane, supra." Stevens, supra, 141 N.J.A.R. at 150. The agency also failed to prove that "this bartender should have seen the conduct of [the intoxicated patron]." Id. at 151.

In the case before us, there is sufficient evidence to affirm the Director's conclusion that Herrera was both actually and apparently intoxicated when he was served alcohol, and that unlike the thirty-second transaction in Stevens, supra, Herrera and Robles were sitting at the bar for an extended period of time, ordering drinks from D'Amico and trying to flirt with her. D'Amico had ample opportunity to observe them, and hence she knew or should have known that Herrera was apparently intoxicated. If she had any doubt, she should have made further inquiries of Herrera to determine his condition, Zane, supra, but she did not. This is sufficient to prove a violation of N.J.A.C. 13:2-23.1(b).

In its reply brief, MAG contends that the Division must present eyewitness testimony that the patron was visibly intoxicated at the very moment he was served alcohol and therefore the agency cannot establish a violation of N.J.A.C. 13:2-23.1(b) based on circumstantial evidence. We find no basis in law or logic for such a novel rule of law.

Circumstantial evidence is often used to establish that a person has been intoxicated at a point in the past. In drunk driving cases, for example, evidence of a driver's conduct and blood alcohol level shortly after a traffic stop is routinely introduced to prove that the driver was intoxicated while driving. See e.g., State v. Ravotto, 169 N.J. 227, 242 (2001). It is not necessary to present an eyewitness to the driver's intoxicated behavior at the exact moment he or she was driving. Moreover, as we observed in Bauer, supra, 399 N.J. Super. at 84 n.1, "we have found that the tortfeasor's manner of driving after leaving the defendant bar may be probative of the tortfeasor's condition while at the bar, depending on the time interval that has elapsed." We reached a similar conclusion in an earlier case involving a bar's tort liability for serving an intoxicated patron:

The proposed testimony of Shemper and Place [who witnessed Kelly's erratic driving] clearly and substantially contradicted Kelly's version. If their testimony was believed, the jury might well have determined that Kelly was intoxicated when he was driving and was visibly intoxicated when served alcoholic beverages at the Sayreville Bar. We agree with plaintiff that since the accident took place only five minutes after Kelly left the Sayreville Bar, his driving between the time he left the bar and the accident was highly probative of his condition when he was driving, and while he was at the bar. [Truchan, supra, 323 N.J. Super. at 51.]

Courts in other jurisdictions have directly held that a dram shop act violation can be proven by circumstantial evidence. See Dines v. Henning, 466 N.W.2d 284 (Mich. 1991), rev'g on dissent, 459 N.W.2d 305 (Mich. Ct. App. 1990). Notably, in his dissent, with which the Supreme Court agreed, Judge Kelly stated: "Eyewitness testimony of visible intoxication is not required to establish a dramshop claim; visible intoxication may be proven by circumstantial evidence and the inferences drawn therefrom." 459 N.W.2d at 308 (Kelly, J., dissenting). See also Hyler v. Dixon, 408 N.W.2d 121, 127 (Mich. Ct. App.)("This court has repeatedly held that an action under the dramshop act may be proven by circumstantial evidence."), appeal denied, 428 Mich. 922 (1987). The New York Court of Appeals reached the same conclusion in Adamy v. Ziriakus, 704 N.E.2d 216, 218 (N.Y. 1998), stating that "the failure to provide direct proof of visible intoxication in Dram Shop Act cases is not itself dispositive." We perceive no reason to reach a different conclusion in cases alleging a violation of N.J.A.C. 13:2-23.1.

Having concluded that there is substantial credible evidence to support the Director's conclusion that D'Amico violated N.J.A.C. 13:2-23.1(b) by serving Herrera when he was in a state of visible intoxication, we next address the issue of the penalty.*fn11 The Director initially adopted the ALJ's recommendation that the bar's license be revoked. We find no error in this decision. The determination did not turn on whether Ginty called a taxi for Robles and Herrera. The "extreme aggravating circumstances," as the Director summarized them, were as follows:

[W]hen Herrera became obnoxiously drunk and combative, MAG's employees forcibly removed him from the bar and threw him out into the parking lot, where they admittedly left him unattended and unrestrained, with keys in his pocket, knowing he had driven to the bar. . . . MAG's behavior . . . appears to have been calculated to keep its premises clear of the obnoxious drunken mess Herrera had become in their bar, where he might have disrupted business. Instead, MAG foisted him on the unsuspecting motoring public, resulting in the death of the [two auto accident victims].

The record supports the Director's conclusion. A licensed establishment must not serve an intoxicated patron. N.J.A.C. 13:2-23.1(b). Ordinarily, the penalty for a violation is a fifteen-day suspension. N.J.A.C. 13:2-19.11. However, the Director may increase the penalty based on a finding of aggravating factors, N.J.A.C. 13:2-19.13(a), and may revoke a license based on a first violation if it is sufficiently egregious. Butler Oak Tavern v. Div. of Alcoholic Beverage Control, 20 N.J. 373, 381 (1956).*fn12

We find no error in the Director's conclusion that, once a licensee violates N.J.A.C. 13:2-23.1(b) by serving a patron such as Herrera past the point of visible intoxication, the licensee greatly compounds the violation by failing to ensure that the drunken patron does not drive. Put bluntly, a drunk with car keys in his pocket is a fatal accident waiting to happen. In this case, the bar employees ejected the drunken Herrera from the bar and let him drive away. See Bauer v. Nesbitt, supra, 199 N.J. Super. at 83 (addressing a bar's duty under tort law principles to ensure that a visibly drunken patron does not drive).

While this was the bar's first violation of N.J.A.C. 13:2-23.1(b), the issue is not what penalty we would impose, but whether the Director's decision was so disproportionate to the offense as to shock our sense of fairness. See Maynards, Inc., supra, 192 N.J. at 183-84. The Court found the penalty excessive in Maynard's, where the Director imposed strict liability on a licensee that was making "extraordinary efforts" to prevent drug dealing on its premises, and imposed a very lengthy penalty despite an ALJ's recommendation for leniency. Ibid. The Court reached a similar conclusion in Ishmal v. Div. of Alcoholic Beverage Control, 58 N.J. 347 (1971), where the owner had done everything she could to keep drug dealers out of her establishment. However, the licensee before us in no way resembles the diligent owners in Maynard's and Ishmal. On the facts of the case before us, we cannot conclude that the penalty of license revocation was so disproportionate as to be deemed excessive.

We next address the Director's decision on the bar's motion for reconsideration. We find no error in the Director's decision to reject the motion insofar as it challenged the findings of a violation of N.J.A.C. 13:2-23.1(b). Appellant's arguments to the contrary are without sufficient merit to warrant further discussion here. R. 2:11-3(e)(1)(E). However, we conclude that the Director's penalty decision warrants modification.

In reconsidering the penalty, the Director gave the bar six months to sell the license in lieu of revocation, conditioned on the bar making an acceptable monetary settlement offer. The difficulty with this decision, as the Director framed it, is that it imposed an un-quantified, and therefore un-reviewable, monetary obligation as part of the penalty for the violation. We recognize that the Director has discretion to reach monetary settlements with licensees in lieu of license revocation. N.J.S.A. 33:1-31; N.J.A.C. 13:2-19.12. However, by incorporating an obligation to reach such a settlement as part of the penalty in this case, without stating an amount that the agency would accept to resolve the matter, the agency is setting a target that it can move at will. All the agency need do to defeat the licensee's ability to sell the license in lieu of revocation is to keep rejecting the licensee's settlement offers.

In these circumstances, we conclude the agency has implicit authority to state a monetary amount it would accept in settlement and to incorporate that amount in its decision.*fn13 See In re Kim, ___ N.J. Super. ___ (App. Div. 2008) (slip op. at 9).

Of course, nothing precludes the agency from engaging in further negotiations over the penalty amount, but at least it will provide a determination that is amenable to meaningful future appellate review if the matter cannot be resolved.

Therefore, we remand this matter to the agency for the limited purpose of issuing a supplemental decision stating an amount that the agency would accept in lieu of revocation provided the bar can produce a legitimate buyer for the license, and for such additional settlement efforts as the parties may thereafter attempt. We note that the Director has stayed the revocation during the pendency of this appeal, and there appears to be no dispute that the licensee has been operating for the past eight years without further violations of N.J.A.C. 13:2-23.1(b). Therefore, in fairness to the licensee, the Director shall also extend, by another six months from the issuance of the supplemental decision, the licensee's opportunity to sell the license. We do not retain jurisdiction.

Affirmed in part, modified in part, and remanded.

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