AI Generated Opinion Summaries

This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.

Facts

The Southland Corporation, a Texas-based company operating 7-Eleven stores in New Mexico, sought approval for the transfer of ownership of more than 10% of its voting stock to Japanese investors. The City of Albuquerque opposed the transfer, citing concerns about public health, safety, and morals, but failed to provide substantial evidence or the required hearing records to support its disapproval (paras 2-4, 7).

Procedural History

• District Court of Santa Fe County: The court vacated the Director of the Alcohol and Gaming Division's orders disapproving the transfer of liquor licenses, finding the City's disapproval void due to lack of substantial evidence and failure to comply with statutory requirements (paras 6-7).

Parties' Submissions

• Plaintiff-Appellee (Southland Corporation): Argued that the City's disapproval was invalid as it was not supported by substantial evidence and failed to comply with the Liquor Control Act's procedural requirements, including submission of hearing minutes (paras 6-7).
• Defendants-Appellants (Director of the Alcohol and Gaming Division and City of Albuquerque): Contended that the Director was bound by the City's disapproval under the Liquor Control Act, even if the City failed to provide evidence or comply with procedural mandates (paras 5-6).

Legal Issues

• Whether the Director must disapprove a liquor license transfer when the municipality fails to comply with the Liquor Control Act or provide substantial evidence supporting its disapproval.
• Whether the Director's orders disapproving the transfers were supported by substantial evidence.

Disposition

• The Supreme Court of New Mexico affirmed the district court's decision, vacating the Director's orders and remanding the matter to the Division for approval of the stock transfer (paras 12-13).

Reasons

Per Franchini J. (Baca and Frost JJ. concurring):

• The Liquor Control Act requires municipalities to provide substantial evidence and hearing records when disapproving a liquor license transfer. Failure to comply with these requirements invalidates the disapproval (paras 7-9).
• The City's disapproval was unsupported by substantial evidence, as no connection was established between the stock transfer to Japanese investors and any detriment to public health, safety, or morals (paras 10-11).
• The Director is not obligated to ratify an invalid municipal disapproval. The Act allows the Director to approve transfers when the governing body fails to meet statutory requirements (paras 9-11).
• The Court affirmed the district court's decision and remanded the case to the Division for approval of the stock transfer (paras 12-13).