decided: February 28, 1983.
IN RE: REVOCATION OF LIQUOR LICENSE NO. R-2193 AND AMUSEMENT PERMIT NO. AP-2193 ISSUED TO A.R.F. BAR, INC. A.R.F. BAR, INC., APPELLANT
Appeal from the Order of the Court of Common Pleas of Philadelphia County in the case of In Re: Revocation of Restaurant Liquor License No. R-2193 and Amusement Permit No. AP-2193 issued to A.R.F. Bar, Inc. Appeal of Pennsylvania Liquor Control Board, Misc. No. 80-02-2389.
Joseph Rappaport, Rappaport and Furman, for appellant.
Kenneth W. Makowski, Deputy Chief Counsel, with him J. Leonard Langan, Chief Counsel, for appellee.
President Judge Crumlish, Jr. and Judges Blatt and MacPhail, sitting as a panel of three. Opinion by President Judge Crumlish, Jr.
[ 72 Pa. Commw. Page 368]
The Philadelphia County Common Pleas Court, by order, affirmed the revocation of A.R.F. Bar, Inc.'s (ARF) restaurant liquor license and the forfeiture of its bond. ARF appeals. We affirm.
The facts are undisputed. ARF borrowed money from Penn Finance Corp. (Penn) and secured the loan by pledging its corporate stock and perfecting a security interest in its liquor license. On October 31, 1979, the Pennsylvania Liquor Control Board (Board) cited ARF for a violation which had occurred on January 11, 1979.*fn1 After a hearing, the Board, considering as well two prior citations, revoked ARF's license. In the meantime, on July 5, 1979, having missed several payments, ARF's loan was foreclosed on by Penn which took title to ARF's corporate stock and forwarded the license to the Board for safekeeping.*fn2
[ 72 Pa. Commw. Page 369]
The trial court initially vacated the revocation, finding that one of the prior citations was procedurally defective.*fn3 However, acting on the Board's petition for reconsideration, the court reinstated the revocation and bond forfeiture.*fn4
On appeal to this Court,*fn5 ARF first argues that the liquor license is personal property and, hence, is subject to a valid security interest. We disagree. To be afforded the secured transaction protection of the Uniform Commercial Code,*fn6 the subject of the security interest must be personal property.*fn7 In our most
[ 72 Pa. Commw. Page 370]
recent pronouncement, we relied on Section 468(b) of the Liquor Code*fn8 in concluding that, for purposes of the execution process under the Pennsylvania Rules of Civil Procedure,*fn9 a liquor license constitutes a personal privilege rather than a property right. 1412 Spruce, Inc. v. Pennsylvania Liquor Control Board, 70 Pa. Commonwealth Ct. 501, 503, 453 A.2d 382, 384 (1982). Seeing no reason to differentiate, we conclude that, for security interest purposes, a liquor license does not constitute personal property.*fn10
ARF, relying on Primo's Bar, Inc. Liquor License Case, 48 Pa. Commonwealth Ct. 188, 409 A.2d 1369 (1979), also argues that the Board cannot revoke a license when such revocation would work a forfeiture against an innocent third party lender. In Primo's Bar, Inc., we prevented the Board from revoking a license because to do so would have been detrimental to a lender "who is now in control of the corporation, for a corporate officer's conduct unconnected to either the Liquor Code or conduct on the premises." Id. at 194, 409 A.2d at 1373. (Emphasis added.) This license was revoked for illegal conduct both connected
[ 72 Pa. Commw. Page 371]
with the Liquor Code*fn11 and which had occurred on the premises. Consequently, Penn, although foreclosing on the loan and taking title to ARF's stock without notice of any violations, is not entitled to be protected by the doctrine delineated in Primo's Bar, Inc.
The Philadelphia County Common Pleas Court order, No. Misc. No. 80-02-2389, dated September 29, 1980, is hereby affirmed.