Opinion
No. 71-219
Decided June 20, 1972. Rehearing denied July 11, 1972. Certiorari denied August 28, 1972.
Counterclaim of widow alleged that deceased who held an interest in a liquor license had also been equitable owner of cocktail lounge whose license was held in plaintiff's name. From dismissal of counterclaim, widow appealed.
Affirmed
1. INTOXICATING LIQUORS — Widow — Alleged — Successor — Equitable Owner — Cocktail Lounge — In Plaintiff's Name — Properly Dismissed — Statute — Prohibits — Multiple Ownership — Liquor Licenses. Where, in counterclaim, widow alleged that deceased had paid for construction of cocktail lounge, but that the lounge was held in plaintiff's name because deceased already held an interest in another liquor license, and where she sought relief as successor in interest to the equitable owner of the lounge, widow, either claiming as deceased's heir or as executrix of his estate, cannot benefit by deceased's illegal acts; and trial court properly dismissed counterclaim on basis of statute prohibiting multiple ownership of liquor licenses by single party.
Appeal from the District Court of El Paso County, Honorable Hunter D. Hardeman, Judge.
Donald E. LaMora, for plaintiff-appellee.
James B. Radetsky, Jules J. Ornstein, Irvin M. Kent, for defendant-appellant.
Robert J. Flynn, for defendant D. W. Bell.
Plaintiff, Frederics, initially filed two actions against Rose Bressler and other defendants, to which Rose and one other defendant filed counterclaims. Upon trial to court, claims of all parties were dismissed. Only Rose's counterclaim is before us on appeal.
Facts pertinent to the counterclaim are that Rose and her deceased husband, Louis, owned and operated a bar and restaurant under a liquor license in their names. They were both aware that, under Colorado law, they could own and hold a liquor license for only one such establishment. Although evidence was highly contradictory, the court found that Louis had entered into an agreement or arrangement with Frederics, whereby Frederics obtained a liquor license on a bar and restaurant known as the Classic Lounge and that Frederics obtained a lease on the property. It also found that Louis advanced, or otherwise contributed, money toward furnishing and equipping the lounge and was, in effect, part owner of the lounge.
Louis died in 1967. The initial license was obtained by Frederics in 1966, and was renewed by him each year thereafter until this suit was filed in 1969. Rose testified that she knew the license for the Classic Lounge was put in Frederics' name because Louis' name was on the other license with her own.
In her counterclaim, Rose, suing individually and as executrix of Louis' estate, maintained, among other things: (1) that Louis had paid for the construction of the lounge; (2) that the license was held in Frederics' name because Louis already had an interest in another liquor license; (3) that after Louis' death, Frederics asserted ownership to the property and converted the income and profits to his own use; (4) that she was the only heir and legatee of Louis; and (5) that "as successor in interest of Louis" she should be protected. She also asked that Louis be declared the equitable owner of the lounge and that she be granted certain relief, either as successor in interest to Louis or as his sole heir and legatee.
It appears that her principal theory during trial was that Frederics was holding the property under an implied trust for her benefit.
The trial court dismissed her claim, citing as its authority C.R.S. 1963, 75-2-15, which reads in pertinent part:
"(3) It shall be unlawful for any owner, part owner, shareholder or person interested directly or indirectly in any retail liquor establishment, retail license, liquor licensed drug store, or retail dispensary of any kind licensed hereunder to conduct, own either in whole or in part, or be directly or indirectly interested in any other retail liquor establishment or license or retail dispensary of any kind licensed hereunder in this state.
. . . .
"(7) Any transaction, agreement, or arrangement prohibited by the provisions of this section, if made and entered into by and between the persons and parties described and referred to in this section, shall be unlawful, illegal, invalid and void, and any obligation or liability arising out of such transaction, agreement, or arrangement shall be unenforceable in any court of this state by or against any such persons and parties entering into such transaction, agreement or arrangement."
Further, 1969 Perm. Supp., C.R.S. 1963, 75-2-15(8) states:
"The purpose and intent of the provisions of this section is to prohibit and prevent the control of the outlets for the sale of alcoholic beverages defined in this article by any persons or parties other than the licensee licensed under the provisions of this article."
When claiming as executrix of Louis' estate, Rose is asserting rights of the decedent. As such, her claim is subject to the limitations appurtenant to any claim decedent might have had; thus, the wording of the statute itself, and clear public policy, would bar her recovery. See Fishman v. Davis, 112 F.2d 432; Potter v. Swinehart, 117 Colo. 23, 184 P.2d 149; and Metropolitan Life Insurance Co. v. Roma, 97 Colo. 493, 50 P.2d 1142.
Rose maintains that the court's factual findings established only that Frederics and Louis were parties to the illegal contract. Because of this fact, she argues that although she had full knowledge of its effect and purpose, she should not be barred by the statute from imposition of the trust she requests. We disagree.
[1] Her counterclaim clearly states that, for all relief sought, she is claiming by and through Louis as his heir or successor, and we rule that she cannot benefit from Louis' illegal acts. Whether claiming individually, as Louis' heir, or as executrix of his estate, the result is the same since both claims are derivative from Louis' rights, and such derivative rights can be no greater than those of Louis.
In light of this holding, it is unnecessary to consider the argument as to whether her lack of "clean hands" in this matter would bar her recovery. Nor need we consider whether the requisites of a resulting or constructive trust have been established.
Judgment affirmed.
CHIEF JUDGE SILVERSTEIN and JUDGE SMITH concur.