                  IN THE COURT OF APPEALS OF TENNESSEE
                              AT NASHVILLE
                                     October 10, 2001 Session

    OLIVER RANDOLPH, ET AL V. COFFEE COUNTY BEER BOARD,
                           ET AL.

                         Appeal from the Circuit Court for Coffee County
                              No. 30,241 Judge John W. Rollins



                      No. M2001-00077-COA-R3-CV - Filed March 7, 2002


         This is an appeal by the Coffee County Beer Board from a decision of the Coffee County
Circuit Court ordering the Beer Board to issue permits to Oliver Randolph and Susan Nichols. The
trial court concluded that the Coffee County Beer Board regulation prohibiting the issuance of a beer
permit to an applicant within two thousand feet of a school or church was void because of
discriminatory application of this regulation. The County has appealed this decision insisting that
it had uniformly enforced its distance rule including a grandfather provision which authorized the
reissuance of permits to nonconforming locations who had enjoyed such a privilege prior to the
readoption of the county resolution in 1980. For the reasons stated in this opinion, we affirm the trial
court’s decision and remand the case.

   Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court is Affirmed and
                                        Remanded

J.S. DANIEL, SP. J., delivered the opinion of the court, in which BEN H. CANTRELL, P. J., M.S., and
PATRICIA J. COTTRELL, J, joined.

Robert Fulton Hazard, Tullahoma, Tennessee, for the Appellants, Coffee County Beer Board, et al.

William C. Reider, Tullahoma, Tennessee, for the Appellees, Oliver Randolph and Susan Nichols.

                                               OPINION

                                                   I.
                                                 FACTS

        There is no dispute as to the facts in this particular case. At the trial of this matter the parties
stipulated the facts and exhibits. In 1940 the Coffee County Quarterly Court enacted a resolution
which provided that “No permit shall be issued for the sale, storage or manufacture of beer at a
location which is within two thousand feet of any church, school, or other place of public gathering.”
Between June 9, 1976 and January 11, 1980, the Coffee County Beer Board issued beer permits to
at least four locations which were within the two thousand feet prohibition from a church or school,
in violation of their regulation. In an effort to reestablish the enforceability and validity of their
regulation, on February 25, 1980, the Coffee County Board of County Commissioners adopted a
resolution which cited Tenn. Code Ann. § 57-205 as its statutory authority and provided that the
Coffee County Beer Board, “not issue any permit for sale of beer for any location that lies less than
two thousand feet, measured straight from point to point, from any church or school . . . .” The 1980
resolution also contained the following provision, “Further resolved that this resolution shall in no
way affect any location that has been issued a permit and is on this date in operation.” Throughout
these proceedings, this last sentence has been referred to as the County’s grandfather clause.

         Since the adoption of the 1980 resolution, the Coffee County Beer Board has complied with
all the requirements of the resolution, including the grandfather clause. The grandfather clause has
been complied with by the County Beer Board issuing beer permits to new owners of the
grandfathered locations and the County Beer Board refusing to issue permits to all other locations
within two thousand feet of a school or church. However, the county did not revoke any
noncomplying permits.

        On January 18, 2000, Oliver Randolph applied to the Beer Board for a permit to sell beer at
a location within two thousand foot of a church or school. Mr. Randolph’s application was denied
on the basis of the two thousand foot rule. On January 25, 2000, Mary Susan Nichols also applied
to the Beer Board for a permit to sell beer at a location that was within two thousand foot of a church
or school. Ms. Nichols’s application was also denied on the basis of the two thousand foot rule.
Neither Mr. Randolph’s nor Ms. Nichols’s applications dealt with locations that enjoyed permits
issued for the sale of beer prior to the 1980 resolution. Therefore, the sole basis for denial of the
permits was that the locations failed to be more than two thousand feet from a church or school.

                                                 II.
                                               ISSUE

        The issue for consideration and determination in this case is whether the trial court erred in
finding that the Coffee County’s 1980 “distance resolution” prohibiting beer sales within two
thousand feet of a school or church, was void because of discriminatory application. Intertwined
with the initial issue is whether the Coffee County resolution has a valid grandfather provision which
complies with Tenn. Code Ann. § 57-5-109, thereby validating the action of the Board.

                                              III.
                                            DECISION

      Our review in this case with respect to the trial court’s legal conclusions is de novo with no
presumption of correctness. Stein v. Davidson Hotel Co., 945 S.W.2d 714, 716 (Tenn. 1997);

                                                  2
Pursell v. First American Nat’l Bank, 937 S.W.2d 838, 840 (Tenn. 1996); Cook v. Spinnaker’s of
Rivergate, Inc., 878 S.W.2d 934, 938 (Tenn. 1994); Tenn. R. App. P. 13(d).

       The trial court found that the Beer Board ordinance was invalid because of prior
discriminatory enforcement of that ordinance. Discriminatory enforcement of Beer Board
ordinances in the issuance of licenses is illegal and violates the equal protection rights of those who
are denied such a permit. When permits are issued in violation of the ordinance’s limitation on
distance, such permits destroy the validity of the ordinance. Seay v. Knox County Quarterly Court,
541 S.W.2d 946, (Tenn. 1976).

        The stipulated facts in this case establish that between June 9, 1976 and January 11, 1980,
the Coffee County Beer Board engaged in the discriminatory issuance of beer permits to locations
that did not comply with the distance resolution. Once discriminatory enforcement of beer permit
distance ordinances has been established, those ordinances cannot be rectified by post facto
amendments. Restoration of the validity of a distance ordinance can only be achieved by revocation
or other elimination, such as attrition, of the discriminatorily issued permits and licenses. Rutherford
County Beer Board v. Adams, 571 S.W.2d 830 (Tenn. 1978); City of Murfreesboro v. Davis, 569
S.W.2d 805, (Tenn. 1978); Seay v. Knox County Quarter Court, 541 S.W.2d 946 (Tenn. 1976); Serv.
U. Mart, Inc. v. Sullivan County, 527 S.W.2d 121 (Tenn. 1975).

        Clearly, in these stipulated facts, Coffee County was attempting to restore the validity of their
distance ordinance by the County Commission’s resolution in 1980. The resolution attempted to
reinstitute the distance ordinance, however, this could only be accomplished by the revocation of
noncomplying licenses or other elimination of such licenses by attrition. Revocation was the means
in which the county reestablished a distance limitation in the cases of Henry v. Blount Cty. Beer
Bd., 617 S.W.2d 888 (Tenn. 1981) and Needham v. Beer Bd. of Blount Cty., 647 S. W. 2d 226
(Tenn. 1983). The Court approved of revocation as the method of reinstituting the distance
limitation in these cases. The Court in Needham, id. at 231, emphasized that since the
discriminatorily issued beer permits had been eliminated by revocation that the county’s regulation
was restored to it’s validity. Key to the restoration of the distance ordinance is the elimination of
the discriminatorily issued permits, and this may be accomplished by revocation or attrition.

        Coffee County never revoked any of the discriminatorily issued permits. The county
contends that they had established an attrition policy for the elimination of these permits. The trial
court made a finding that the County Beer Board had an attrition policy, although there appears to
be no such written policy in the record. The County asserts that their attrition policy was that if there
was a cessation of the sale of beer at one of the grandfathered locations, that location would no
longer qualify for a permit. It appears from the record, that four of the locations which did not
comply with the distance regulations under the 1940 regulation, have been sold and new beer permits
issued to the new owners after the 1980 resolution. The record does not establish the removal of any
noncomplying location by attrition as the result of cessation of the sale of beer.




                                                   3
        Attrition is defined in Webster’s Collegiate Dictionary 75 (10th ed. 1993), as a reduction in
numbers usually as a result of resignation, retirement or death. Attrition, as defined in the unwritten
county policy, has resulted in the removal of no location that received a discriminatorily granted beer
permit through resignation, retirement, death or otherwise. Therefore, Coffee County’s attrition is
an illusion, and in reality this policy has lent itself to a perpetuation of the discriminatorily issued
permits. Such a policy violates the holding of the Supreme Court which requires the elimination of
discriminatorily issued permits in order for a county to restore validity to its distance regulations.


        The Legislature has provided assurances to those businesses who possess a valid beer license
that those licenses will not be revoked by city or county because of the proximity of the business to
a school or residence through the passage of Tenn. Code Ann. § 57-5-109. This statute became
effective January 1, 1993 and states as follows:

        “A city or county shall not suspend, revoke or deny a permit to a business engaged
        in selling, distributing, or manufacturing beer on the basis of the proximity of the
        business to a school, residence, church or other place of public gathering if a valid
        permit had been issued to any business on the same location as of January 1, 1993.
        This section shall not apply if beer is not sold, distributed or manufactured at that
        location during any continuous six month period after January 1, 1993."

This Court has previously had an opportunity to construe this statute in the case of Exxon Corp. v.
Metro. Gov’t, 2001 Tenn. App. LEXIS 44, Tenn. App. MS, Jan. 24, 2001, No. M2000-00614-COA-
R3-CV. In examining the legislative intent, we concluded that the legislature intended to provide
protection to businesses that had valid permits if those permits “had been issued to any business on
that same location as of January 1, 1993.” Therefore, we must consider whether this statute affords
Coffee County the right, under its grandfather clause, to continue issuing beer permits to these
nonconforming locations.

         This statute is applicable and only gives the county relief if the permits in question are valid.
It would be possible to have valid permits issued to locations which failed to meet the current county
distance requirement. This could occur where the beer permit had been issued to a location which
complied with the county’s then existing distance requirements and thereafter a church and/or school
was built within two thousand feet from the establishment enjoying the license. In such a case, the
validly issued permit precedes the entry of the use which the distance requirement is measured from.
Another way in which a valid permit could exist is if the original permit had complied with the then
existing county distance requirement and thereafter the county, by a different resolution, changed
its distance requirement to a distance that was closer to a church or school than had existed in the
ordinance under which the original permit was issued. In situations such as these the permit had
been validly issued and the legislature, through Tenn. Code Ann. § 57-5-109 has provided the
business owner with assurance that the city or county could not suspend, revoke or deny the business
location’s permit for the continuation of beer sales at that location absent a complete cessation of the
sale of beer for six continuous months.

                                                    4
        This is not the situation presented in this case. What has occurred in this case is the
perpetuation of the discriminatorily issued beer permits that preceded the 1980 resolution. We
conclude that the 1980 resolution and its grandfather provision failed to remedy the prior
discriminatory issuance of beer permits by revocation or attrition and, therefore, the Coffee County
grandfather clause perpetuated that discrimination and permits issued under the grandfather clause
are invalidly issued. Therefore, the protection of this statute is not available to the county to justify
the continuation of this discriminatory practice.

        We conclude that the trial court properly applied the law in this case to the stipulated facts
and the trial court’s determination is affirmed. This case is to be remanded to the Coffee County
Circuit Court for execution of a judgment and the issuance of the permits.



                                                ___________________________________
                                                      J.S. DANIEL, SPECIAL JUDGE




                                                   5
