                                         COURT OF APPEALS OF VIRGINIA


            Present: Chief Judge Felton, Judges Frank, Humphreys, Kelsey, Petty, Alston, McCullough, Huff
PUBLISHED


                      and Chafin
            Argued at Richmond, Virginia


            KEPA, INC., d/b/a
             SHE-SHA CAFÉ AND HOOKAH LOUNGE
                                                                                     OPINION BY
            v.     Record No. 1164-12-3                                        JUDGE WILLIAM G. PETTY
                                                                                  DECEMBER 17, 2013
            VIRGINIA DEPARTMENT OF HEALTH


                                           UPON A REHEARING EN BANC

                            FROM THE CIRCUIT COURT OF MONTGOMERY COUNTY
                                            Colin R. Gibb, Judge

                           Andrew P. Connors (James R. Creekmore; Keith Finch; The
                           Creekmore Law Firm PC, on briefs), for appellant.

                           Paul Kugelman, Jr., Assistant Attorney General (Kenneth T.
                           Cuccinelli, II, Attorney General, on brief), for appellee.


                   Kepa, Inc., doing business as She-Sha Café and Hookah Lounge (“She-Sha”), appeals

            from an order of the trial court upholding the decision of the Virginia Department of Health

            (“Department”) that She-Sha is not exempt from the regulations1 of the Virginia Indoor Clean

            Air Act (“VICAA”). A divided panel of this Court held that She-Sha was not exempt from the

            regulations of the VICAA and accordingly affirmed the trial court’s decision. Kepa, Inc. v. Va.

            Dep’t of Health, 61 Va. App. 696, 740 S.E.2d 26 (2013). We subsequently granted She-Sha’s




                   1
                   The Department cited She-Sha for violating Code § 15.2-2825(D) (requiring
            no-smoking signs) and Code § 15.2-2825(F) (prohibiting smoking).
petition for rehearing en banc and stayed the panel decision.2 On rehearing en banc, we hold that

She-Sha is exempt from the regulations of the VICAA because it is a retail tobacco store.

                                          I. BACKGROUND

          On appeal, we view the evidence in the light most favorable to the Department of Health,

the party prevailing below. See Hilliards v. Jackson, 28 Va. App. 475, 479, 506 S.E.2d 547, 549

(1998).

          She-Sha is a retail tobacco store and restaurant located in Blacksburg, Virginia. The

business model for She-Sha involves charging patrons for a flavored, wet tobacco which is

heated by a burning coal and then smoked through a water-filled pipe known as a hookah.3

          She-Sha does not allow its customers to consume any outside tobacco on its premises.

Instead, customers pay a fee to rent a hookah filled with hookah tobacco. She-Sha also sells

packaged tobacco for customer use off-premises. To go along with hookah and tobacco sales,

She-Sha offers customers a menu of food and beverage items.

          She-Sha has been in business since 2003, and has nearly half a million dollars in annual

revenue. Tobacco and tobacco-related sales, e.g., hookah rentals, accounted for sixty-six percent

to sixty-seven percent of She-Sha’s revenue in the three months preceding the citations from the

Department—December 2009 to February 2010. These sales figures have been consistent since

September 2008.4


          2
        By granting the petition for rehearing en banc, we vacated the previous panel decision.
See Logan v. Commonwealth, 47 Va. App. 168, 170, 622 S.E.2d 771, 772 (2005) (en banc).
          3
        A hookah is a “pipe for smoking that has a long flexible tube whereby the smoke is
cooled by passing through water.” Webster’s Third New International Dictionary 1088 (2002).
          4
          Prior to December 2009, She-Sha included tobacco-to-go purchases in its merchandise
sales figures. Thus, She-Sha’s financial records showed a lower percentage of tobacco and
tobacco-related sales before that date. According to the sales figures and uncontested testimony
from She-Sha, if the tobacco-to-go purchases would have been calculated separately—as they
were from December 2009 to February 2010—then the percentage of tobacco and
                                               -2-
       She-Sha is licensed by the Department of Taxation as an “Other Tobacco Product

Retailer.” As of February 2010, She-Sha had paid a total of $7,208.72 in other tobacco products

taxes to the Commonwealth. She-Sha has a “Restaurant and Retail Tobacco Store” business

license that was issued by the Town of Blacksburg. She-Sha is also “a place where food is

served,” defined in Code § 15.2-2820 as a “restaurant.” Accordingly, She-Sha has a

permit/license from the Department to operate as a restaurant.

       On January 27, 2010, the Department investigated a complaint that She-Sha was allowing

customers to smoke in its place of business. In a Food Establishment Evaluation Report, the

Department cited She-Sha for two non-critical violations of the VICAA: (1) failure to post

no-smoking signs as required by Code § 15.2-2825(D), and (2) failure to prohibit smoking in

non-smoking areas as required by Code § 15.2-2825(F).

       She-Sha requested an informal fact-finding hearing to dispute the citations. On March

22, 2010, Dr. J. Henry Hershey, the Director of the New River Health District for the

Montgomery County Health Department, conducted the informal fact-finding hearing. On July

8, 2010, Dr. Hershey issued a letter opining that the citations were proper.

       She-Sha then requested a formal adjudicatory hearing. She-Sha also renewed its request

for a summary case by the Department pursuant to Code § 2.2-4020.1.5 In its request, She-Sha

stipulated that it was a restaurant as defined in the VICAA. By letter dated October 12, 2010, the

State Health Commissioner informed She-Sha that a summary case decision was inappropriate at

that time, but the Department would consolidate the summary case decision proceeding with the

formal hearing She-Sha had requested.

tobacco-related sales since at least September 2008 would have been consistent with the
December 2009 to February 2010 sales percentages. The Department stipulated to the accuracy
of the sales figures.
       5
         This “renewed request” is the only request contained in the agency record; the initial
request was not included.
                                              -3-
       The formal adjudicatory hearing was conducted on March 15, 2011. On May 19, 2011,

the hearing officer recommended nine findings of fact and conclusions of law. On June 17,

2011, the Health Commissioner issued a case decision agreeing with and adopting the hearing

officer’s recommendations. The case decision upheld the violations noted in the report and

stated that She-Sha is a restaurant subject to the regulations of the VICAA.

       She-Sha appealed the Department’s decision to the Circuit Court for Montgomery

County on August 12, 2011. The circuit court issued a letter opinion, and subsequent final order,

holding that She-Sha is not exempt from the VICAA; therefore, it dismissed the appeal with

prejudice. She-Sha then appealed to this Court.

                                            II. ANALYSIS

       The question presented to us in this appeal is whether a retail tobacco store6 that is also a

restaurant is exempt from the provisions of the VICAA. We hold that it is.

       She-Sha concedes that it is a restaurant; however, it asserts that it is also a retail tobacco

store. In her final agency case decision, the Health Commissioner did not make an explicit

finding regarding She-Sha’s claim that it is a retail tobacco store. However, both the Virginia

Department of Taxation and the Town of Blacksburg recognize that She-Sha is engaged in the

retail sale of tobacco. Furthermore, on brief, and during oral argument before this Court, the

Department conceded that She-Sha is both a restaurant and a retail tobacco store.7 While we are

not bound to accept concessions of law,


       6
           The Code of Virginia does not contain a definition of “retail tobacco store.”
       7
          Specifically, the Department argues on brief: “The fundamental problem with this line
of argument is that [She-Sha] is not just a retail tobacco store. It is, in its best case and as stated
in its 2010 business license application, a ‘restaurant and retail tobacco store.’” Appellee’s Br. at
7. Moreover, at oral argument the Department stated, “Except, here, factually we have a hybrid.
We do[ not] have a retail tobacco store. We have a retail tobacco store and a restaurant.” Oral
Argument at 23:11.

                                                 -4-
               [a]n entirely different paradigm, however, applies to questions of
               fact unique to the litigants and specific to the circumstances of
               each particular case. . . . On purely factual questions, therefore, we
               can and do rely on the adversarial process to sort out the contested
               and the uncontested aspects of the case before we begin our
               responsibility of applying de novo the correct legal principles.

Logan v. Commonwealth, 47 Va. App. 168, 172, 622 S.E.2d 771, 773 (2005).

       Thus, based on the evidence before us and the Department’s concessions, there can be no

dispute that She-Sha is engaged in the retail sale of tobacco and that it is, at minimum, both a

retail tobacco store and a restaurant.8 The dispute arises as to whether She-Sha is exempt from

regulation as a restaurant under the VICAA because of its concurrent operation as a retail

tobacco store. This presents us with a question of statutory construction.

       The Virginia Administrative Process Act (“VAPA”) authorizes judicial review of agency

decisions. See Code § 2.2-4027. Under well-settled principles, the burden is upon the party

appealing such a decision to demonstrate error. Avante at Roanoke v. Finnerty, 56 Va. App.

190, 197, 692 S.E.2d 277, 280 (2010); Carter v. Gordon, 28 Va. App. 133, 141, 502 S.E.2d 697,

700-01 (1998). “Our review is limited to determining (1) ‘[w]hether the agency acted in

accordance with law;’ (2) ‘[w]hether the agency made a procedural error which was not harmless

error;’ and (3) ‘[w]hether the agency had sufficient evidential support for its findings of fact.’”

       8
          The Department suggests that She-Sha’s argument “places every restaurant in the
Commonwealth in the position of being able to avoid the Act by simply selling tobacco retail.”
The dissent picks up on this argument by suggesting that “[w]ith today’s holding, any business
that prepares or serves food but also names itself a retail tobacco store could . . . easily
circumvent regulation under the VICAA.” Infra at 15. We reject both arguments as an overly
broad reading of our opinion. While Virginia, unlike some states, does not define a retail
tobacco store, it is unequivocal from the record that She-Sha’s primary business is the retail sale
of tobacco. See generally Tenn. Code Ann. § 39-17-1802(13) (defining “retail tobacco store” as
“a retail store that derives its largest category of sales from tobacco products and accessories”).
The uncontradicted evidence established that two-thirds of She-Sha’s revenue came from the sale
of tobacco and tobacco-related products. Given the facts before us, coupled with the
Department’s concessions, it is unnecessary to define the term “retail tobacco store.” Similarly,
it is unnecessary to decide at what point the sale of tobacco becomes ancillary to a restaurant’s
primary business of selling food products. Suffice it to say that, here, it is clear that She-Sha is
doing more than “simply selling tobacco retail” or merely “nam[ing] itself a retail tobacco store.”
                                                   -5-
Avante at Roanoke, 56 Va. App. at 197, 692 S.E.2d at 280 (quoting Johnston-Willis, Ltd. v.

Kenley, 6 Va. App. 231, 242, 369 S.E.2d 1, 7 (1988)).

       On appeal from an agency’s determination of law,

               “where the question involves an interpretation which is within the
               specialized competence of the agency and the agency has been
               entrusted with wide discretion by the General Assembly, the
               agency’s decision is entitled to special weight in the courts[,
               and] . . . ‘judicial interference is permissible only for relief against
               arbitrary or capricious action that constitutes a clear abuse of
               delegated discretion.’”

Evelyn v. Commonwealth, 46 Va. App. 618, 624, 621 S.E.2d 130, 133 (2005) (alteration in

original) (quoting Johnston-Willis, 6 Va. App. at 244, 369 S.E.2d at 8). Generally, however,

“[a]n agency’s ‘legal interpretations of statutes’ is accorded no deference because ‘[w]e have

long held that pure statutory interpretation is the prerogative of the judiciary, and thus, Virginia

courts do not delegate that task to executive agencies.’” Commonwealth ex rel. Va. State Water

Control Bd. v. Blue Ridge Envtl. Def. League, Inc., 56 Va. App. 469, 481, 694 S.E.2d 290, 296

(2010) (quoting The Mattaponi Indian Tribe v. Commonwealth Dep’t of Envtl. Quality, 43

Va. App. 690, 707, 601 S.E.2d 667, 676 (2004)); see also Va. Dep’t of Health v. NRV Real

Estate, LLC, 278 Va. 181, 185, 677 S.E.2d 276, 278 (2009) (“Although decisions by

administrative agencies are given deference when they fall within an area of the agency’s

specialized competence, issues of statutory interpretation fall outside those areas and are not

entitled to deference on judicial review.”). Accordingly, we conduct a de novo review of the

agency’s interpretation of the statutes in dispute. Id.

       “Statutory interpretation is a question of law which we review de novo, and we determine

the legislative intent from the words used in the statute, applying the plain meaning of the words

unless they are ambiguous or would lead to an absurd result.” Wright v. Commonwealth, 278

Va. 754, 759, 685 S.E.2d 655, 657 (2009). The Virginia Supreme Court has long held that

                                                 -6-
“when analyzing a statute, we must assume that ‘the legislature chose, with care, the words it

used . . . and we are bound by those words as we interpret the statute.’” City of Virginia Beach

v. ESG Enters., 243 Va. 149, 153, 413 S.E.2d 642, 644 (1992) (quoting Barr v. Town & Country

Properties, 240 Va. 292, 295, 396 S.E.2d 672, 674 (1990)). “‘Where the legislature has used

words of a plain and definite import the courts cannot put upon them a construction which

amounts to holding the legislature did not mean what it has actually expressed.’” Tazewell

County Sch. Bd. v. Brown, 267 Va. 150, 162, 591 S.E.2d 671, 676-77 (2004) (quoting City of

Winchester v. American Woodmark Corp., 250 Va. 451, 457, 464 S.E.2d 148, 152 (1995)).

       If multiple sections of a statute are inconsistent or ambiguous when read together, then

we “are required to harmonize any ambiguity or inconsistency in the statute to give effect to the

General Assembly’s intent without usurping ‘the legislature’s right to write statutes.’” Parker v.

Warren, 273 Va. 20, 24, 639 S.E.2d 179, 181 (2007) (quoting Boynton v. Kilgore, 271 Va. 220,

229-30, 623 S.E.2d 922, 927 (2006)). Accordingly, we must give “‘every word and every part of

the statute, if possible, its due effect and meaning, and to the words used their ordinary and

popular meaning, unless it plainly appears that they were used in some other sense.’” Epps v.

Commonwealth, 47 Va. App. 687, 714, 626 S.E.2d 912, 924 (2006) (en banc) (quoting Posey v.

Commonwealth, 123 Va. 551, 553, 96 S.E. 771, 771 (1918)).

        In 1990, the General Assembly enacted Chapter 28.2 of Title 15.2 of the Code of

Virginia and entitled it “The Virginia Indoor Clean Air Act.” As originally enacted, the VICAA

banned smoking in various government buildings and in some public areas. See Code




                                                -7-
§ 15.2-2824. In 2009, the VICAA was amended to also ban smoking in all restaurants and bars

in the Commonwealth, subject to certain exceptions.9 See Code § 15.2-2825.10

       The VICAA begins with a recital of various definitions in Code § 15.2-2820.

Significantly, the first substantive section, Code § 15.2-2821, which is titled “Applicability,”

reads, in relevant part, “Nothing in this chapter shall be construed to . . . [r]egulate smoking in

retail tobacco stores, tobacco warehouses, or tobacco manufacturing facilities.” Relying on the

plain language of this provision, She-Sha argues that it is exempt from the provisions of the

VICAA. The Department, on the other hand, argues that we should apply rules of statutory

construction to conclude that in enacting Code § 15.2-2825, the General Assembly intended to

ban smoking in any business that sells food, regardless of any other business activities it engages

in.

       We initially note that the exemptions11 in Code § 15.2-2821 apply to the entire VICAA

chapter, whereas the exceptions listed in Code § 15.2-2825 apply only to Code § 15.2-2825.

This is significant because

       9
          The dissent seems to suggest that one reason the General Assembly enacted Code
§ 15.2-2825 was its recognition that “the regulations of the Virginia Administrative Code
consider tobacco to be a contaminant.” Infra at 14. If that were true, it would seem odd that the
General Assembly would expressly allow such a contaminant in: certain operations that prepare
or store food for service to the public, Code § 15.2-2825(A)(1); outdoor areas of restaurants,
Code § 15.2-2825(A)(2); restaurants on the premises of tobacco manufacturers, Code
§ 15.2-2825(A)(3); restaurants used for private functions, Code § 15.2-2825(A)(4); and areas of
restaurants designated and designed as smoking areas, Code § 15.2-2825(A)(5).
       10
           Code § 15.2-2825 is titled, “Smoking in restaurants prohibited; exceptions; posting of
signs; penalty for violation.” Code § 15.2-2825(A) reads, in relevant part, “[S]moking shall be
prohibited and no person shall smoke in any restaurant in the Commonwealth or in any restroom
within such restaurant, except that smoking may be permitted in . . . [a]ny restaurants located on
the premises of any manufacturer of tobacco products.” Code § 15.2-2825(A) provides various
exemptions to the restaurant smoking ban. The only Code § 15.2-2825(A) exemption at issue in
this case is an exemption for “restaurants located on the premises of any manufacturer of tobacco
products.” Code § 15.2-2825(A)(5).
       11
         Exemption is defined as, “Freedom from a duty, liability, or other requirement; an
exception.” Black’s Law Dictionary 653 (9th ed. 2009).
                                            -8-
                [a] proper application of the “whole act interpretation” will ascribe
                to the exception equal power over all other provisions of the act
                unless it is specifically limited to particular sections. As is the case
                with every other section of an act, it must be interpreted as a part
                of the entire act, with equal power and equal authority to restrain
                all other provisions of the act, whether they precede or succeed the
                section itself.

2A Norman J. Singer, Sutherland’s Statutes & Statutory Construction § 20:22 (7th ed. 2009).

       The Department, however, argues that the General Assembly did not intend to limit the

regulation of smoking in a restaurant just because the business also engaged in the retail sale of

tobacco. Specifically, the Department argues that smoking in any restaurant is prohibited unless

the restaurant falls within an exemption listed in Code § 15.2-2825(A). In advancing its

construction of the VICAA, the Department points to the specific exception in Code

§ 15.2-2825(A) for “any restaurants located on the premises of any manufacturer of tobacco

products.” The Department argues that because “tobacco manufacturing facilities” are also

specifically listed in Code § 15.2-2821, the General Assembly intended for Code § 15.2-2825 to

apply to all institutions listed in Code § 15.2-2821 unless there is a specific exemption in Code

§ 15.2-2825(A). The Department’s argument glosses over the plain language used by the

General Assembly—“nothing in this chapter shall be construed to regulate smoking in retail

tobacco stores.” That language makes it clear that the VICAA simply does not apply to retail

tobacco stores. If we were to conclude otherwise, we would be required to engage in exactly

what the plain language of Code § 15.2-2821 prohibits: we would be construing the provisions

of Code § 15.2-2825 to permit the Department to regulate smoking in a retail tobacco store. This

we cannot do.

       Moreover, “when a given controversy involves a number of related statutes, they should

be read and construed together in order to give full meaning, force, and effect to each.” Ainslie

v. Inman, 265 Va. 347, 353, 577 S.E.2d 246, 249 (2003). “Proper construction seeks to

                                                 -9-
harmonize the provisions of a statute both internally and in relation to other statutes.” Hulcher v.

Commonwealth, 39 Va. App. 601, 605, 575 S.E.2d 579, 581 (2003). Indeed, “‘statutes are not to

be considered as isolated fragments of law, but as a whole, or as parts of a great, connected

homogenous system, or a simple and complete statutory arrangement.’” Id. at 606, 575 S.E.2d at

581 (quoting Moreno v. Moreno, 24 Va. App. 190, 198, 480 S.E.2d 792, 796 (1997)).

       The Department’s general authority to regulate restaurants is found in Chapter 2 of Title

35.1 of the Code of Virginia. That chapter unquestionably gives the Department the authority to

regulate the preparation and sale of food in She-Sha. However, when the General Assembly

elected to adopt a statute regulating smoking in restaurants, it chose to make that statute a part of

Chapter 28.2 of Title 15.2 of the Code of Virginia.

       “In interpreting a statute, we presume that the General Assembly acted with full

knowledge of the law in the area in which it dealt.” Philip Morris USA Inc. v. Chesapeake Bay

Found., Inc., 273 Va. 564, 576, 643 S.E.2d 219, 225 (2007). Therefore, we must presume the

General Assembly was well aware that Chapter 28.2 exempted retail tobacco stores. Had the

General Assembly intended to permit the Department to regulate smoking in any facility that

prepares and sells food, it would have included such authority in Chapter 2 of Title 35.1 of the

Code of Virginia, which contains no such exception. The fact that it did not evidences its intent

to continue to permit smoking in a retail tobacco store despite the fact that it also operates as a

restaurant.

       As written, it is readily apparent that the General Assembly sought to exempt retail

tobacco stores from all provisions of the VICAA. She-Sha is unquestionably a retail tobacco

store. Therefore, She-Sha is exempt from the provisions of the VICAA, including Code

§ 15.2-2821.




                                                - 10 -
                                          III. CONCLUSION

       For the foregoing reasons, we reverse the decision of the circuit court and remand this

case to the circuit court for entry of an order consistent with this opinion.

                                                                            Reversed and remanded.




                                                - 11 -
Chafin, J., with whom Frank and McCullough, JJ., join, dissenting.

       I respectfully dissent from the majority’s holding that She-Sha, as a restaurant and retail

tobacco store, is exempt from regulation under the VICAA. Even if we presume She-Sha is a

retail tobacco store as contemplated by the General Assembly, it is not solely a retail tobacco

store. It is also a restaurant. As the VICAA prohibits smoking in restaurants, I believe She-Sha

is subject to regulation under the VICAA.

       At issue is the application of the retail tobacco store exemption in Code § 15.2-2821 and

its relation to the restaurant smoking proscription in Code § 15.2-2825. Code § 15.2-2821 states:

“Nothing in this chapter shall be construed to: 1. Permit smoking where it is otherwise prohibited

or restricted by other applicable provisions of law; or 2. Regulate smoking in retail tobacco

stores, tobacco warehouses, or tobacco manufacturing facilities.” Code § 15.2-2825 states that

“smoking shall be prohibited and no person shall smoke in any restaurant in the

Commonwealth,” subject to limited exceptions. None of these exceptions apply to She-Sha.

She-Sha argues, and the majority holds, that the language of Code § 15.2-2821 entirely exempts

She-Sha from compliance with the VICAA because it is a retail tobacco store. Interpreting the

statute in this manner ascribes a broad meaning to the term “retail tobacco store” that is not

contextually supported and circumvents the purpose of the restaurant smoking ban.

       The majority is correct that “[s]tatutory interpretation is a question of law which we

review de novo, and we determine the legislative intent from the words used in the statute,

applying the plain meaning of the words unless they are ambiguous or would lead to an absurd

result.” Wright v. Commonwealth, 278 Va. 754, 759, 685 S.E.2d 655, 657 (2009). “It is a

cardinal rule of construction that statutes dealing with a specific subject must be construed

together in order to arrive at the object sought to be accomplished.” Alston v. Commonwealth,

274 Va. 759, 769, 652 S.E.2d 456, 462 (2007) (internal quotation marks omitted).

                                               - 12 -
       “Statutes should be construed as a whole,” City of Lynchburg v. English Constr. Co., 277

Va. 574, 584, 675 S.E.2d 197, 202 (2009), and “[i]f a statute is subject to more than one

interpretation, we must apply the interpretation that will carry out the legislative intent behind

the statute, Conyers v. Martial Arts World of Richmond, Inc., 273 Va. 96, 104, 639 S.E.2d 174,

178 (2007).

               Whenever possible, however, it is our duty to interpret the several
               parts of a statute as a consistent and harmonious whole so as to
               effectuate the legislative goal. A statute is not to be construed by
               singling out a particular phrase. Provisos, exceptions, exemptions,
               and grandfather clauses, although facially unambiguous in
               themselves, are inherently inconsistent with the spirit of the statute
               of which they are a part. Accordingly, where, as here, a regulatory
               statute is designed to promote the public welfare and the scope of
               the coverage intended is drawn in doubt by [an entity] claiming
               exemption, courts must determine what was intended.

Virginia Electric & Power Co. v. Board of Cnty. Supervisors, 226 Va. 382, 387-88, 309 S.E.2d

308, 311 (1983) (citations omitted). “The purpose for which a statute is enacted is of primary

importance in its interpretation or construction.” Norfolk So. Ry. Co. v. Lassiter, 193 Va. 360,

364, 68 S.E.2d 641, 643 (1952). As parts of the same act, Code §§ 15.2-2821 and 15.2-2825

must be interpreted so as not to frustrate one or the other, and so that the intended purpose of the

VICAA remains intact. The majority’s interpretation fails to do so.

       She-Sha’s argument rests solely on the exemption language of Code § 15.2-2821(2), that

“[n]othing in this chapter shall be construed to . . . regulate smoking in retail tobacco stores.”

However, it has isolated this second clause of the statute, ignoring the immediately preceding

clause that “[n]othing in this chapter shall be construed to [p]ermit smoking where it is otherwise

prohibited or restricted by other applicable provisions of law.” Code § 15.2-2821(1). The

chapter referred to by this statute is Chapter 28.2 of Title 15.2 of the Code of Virginia, which

contains the VICAA provisions. She-Sha emphasizes the particular words “nothing in this

chapter,” and it argues that because the restaurant smoking ban is contained within the same
                                                - 13 -
chapter, the ban therefore does not apply to She-Sha due to the exemption clause. Through this

proposition, She-Sha is attempting to take advantage of the exemption in order to “permit

smoking where it is otherwise prohibited,” which is prohibited by the preceding clause. If Code

§ 15.2-2821(2) applies to the entire chapter, so too does Code § 15.2-2821(1); and, as such, both

provisions apply equally in determining the applicability of the VICAA.

       Thus, to be internally consistent, the reasonable interpretation of this particular statute is

that a retail tobacco store may be exempt from regulation, so long as said exemption would not

permit smoking somewhere that it would otherwise be prohibited. Smoking is “otherwise

prohibited” in restaurants by Code § 15.2-2825. Applying this interpretation to these sections

gives “full effect to all the statutory language,” Moreno v. Moreno, 24 Va. App. 190, 197, 480

S.E.2d 792, 796 (1997), “harmoniz[ing] the provisions of [the] statute both internally and in

relation to” the VICAA as a whole, Hulcher v. Commonwealth, 39 Va. App. 601, 605, 575

S.E.2d 579, 581 (2003).

       In addition to being internally consistent, an interpretation of Code § 15.2-2821 must be

consistent with the VICAA as a whole. The purpose of the VICAA can be drawn from its name:

to ensure clean indoor air for the citizenry of the Commonwealth. Fines collected as a result of

VICAA violations go to the Virginia Health Care Fund, see Code § 15.2-2825(H), which is

“used solely for the provision of health care services,” Code § 32.1-367. It is undoubtedly a

public health initiative. We are aware, and so too is the General Assembly, that the food

regulations of the Virginia Administrative Code consider tobacco to be a contaminant. See 12

VAC 5-421-220(A) (requiring employees to “use any form of tobacco only in designated areas

where the contamination of exposed food; clean equipment, utensils, and linens; unwrapped

single-service and single-use articles; or other items needing protection cannot result”); 12 VAC

5-421-3140 (stating that “[a]reas designated for employees to . . . use tobacco shall be located so

                                                - 14 -
that food, equipment, linens, and single-service and single-use articles are protected from

contamination”).

       In the VICAA, the legislature chose with care the specific public areas within which it

wanted to restrict exposure to tobacco smoke. See Code § 15.2-2823 through -2825.

Restaurants are clearly one of those public areas. While most areas subject to the VICAA

smoking regulations are listed in Code § 15.2-2824, restaurants have been singled out into an

entirely separate provision of their own: Code § 15.2-2825. Interpreting the VICAA as the

majority has done, however, strips the significance from the legislative choice to expressly

prohibit smoking in restaurants. With today’s holding, any business that prepares or serves food

but also names itself a retail tobacco store could, without any attempt at compliance, easily

circumvent regulation under the VICAA.

       As currently written, the statute provides no definition or determinative characteristics as

to what would qualify as a retail tobacco store. Further, a retail tobacco store that serves food

like traditional restaurants is not simply one or the other, but is a hybrid with the characteristics

of both. Though the majority believes it is unnecessary to define the term “retail tobacco store”

due to the Department’s concessions regarding She-Sha’s business, the meaning of the term is

important for determining what the legislature intended the exemption to encompass. In the

absence of such a concession, we are left with a case-by-case determination of what qualifies as

a retail tobacco store. The plain meaning of “retail store” is “a place of business usu[ally] owned

and operated by a retailer but sometimes owned and operated by a manufacturer or by someone

other than a retailer in which merchandise is sold primarily to ultimate consumers.” Webster’s

Third New International Dictionary 1938 (2002). The meaning of “retail” standing alone is “to

sell in small quantities.” Id. If selling small quantities of tobacco to ultimate consumers is

enough to be considered a retail tobacco store under the statute, then any restaurant could avoid

                                                - 15 -
having to comply with the VICAA by simply selling packs of cigarettes from behind the counter.

Any sales of tobacco products would suffice. This plain meaning interpretation creates a

minimal threshold with the potential for an absurd result. I do not believe this was the

legislature’s intent.

        The majority does not spell out when a restaurant also qualifies as a retail tobacco store

so as to be entirely exempt from the VICAA. At best, therefore, the majority’s holding will

result in confusion and additional litigation. At worst, the majority’s decision will undermine the

salutary public health objectives that motivated the General Assembly to enact the VICAA.

Although customers of such establishments would remain free to take their business elsewhere,

the employees of such restaurants are likely to have far less choice – and far more exposure to

tobacco smoke.

        In light of the foregoing considerations, the more reasonable interpretation of Code

§ 15.2-2821, when read in context as one part of the whole VICAA, is that retail tobacco stores

are exempt from the VICAA if they are solely that: a retail tobacco store. Where such an

establishment overlaps with a public area that the legislature has chosen to specifically regulate,

subject to limited exceptions, the purpose of the VICAA is better served by narrowly construing

the exemption to apply to entities where smoking would not be otherwise prohibited under the

statute. For these reasons, and because She-Sha is not solely a retail tobacco store, I believe

She-Sha is not exempt from complying with the VICAA and I would affirm the circuit court’s

decision.




                                               - 16 -
            VIRGINIA:
                        In the Court of Appeals of Virginia on Tuesday          the 7th day of May, 2013.
PUBLISHED




            Kepa, Inc., d/b/a
             She-Sha Café and Hookah Lounge,                                                                     Appellant,

            against             Record No. 1164-12-3
                                Circuit Court No. CL11009220

            Virginia Department of Health,                                                                       Appellee.


                                                 Upon a Petition for Rehearing En Banc

             Before Chief Judge Felton, Judges Elder, Frank, Humphreys, Kelsey, Petty, Alston, McCullough, Huff and
                                                              Chafin


                    On April 23, 2013 came the appellant, by counsel, and filed a petition requesting that the Court set

            aside the judgment rendered herein on April 9, 2013, and grant a rehearing en banc on the issue(s) raised in the

            petition.

                    On consideration whereof, the petition for rehearing en banc is granted with regard to the issue(s)

            raised therein, the mandate entered herein on April 9, 2013 is stayed pending the decision of the Court en

            banc, and the appeal is reinstated on the docket of this Court.

                    The parties shall file briefs in compliance with Rule 5A:35(b). The appellant shall attach as an

            addendum to the opening brief upon rehearing en banc a copy of the opinion previously rendered by the

            Court in this matter. It is further ordered that the appellant shall file twelve additional copies of the appendix

            previously filed in this case. In addition, any party represented by counsel shall file twelve electronic copies

            of their brief (and the appendix, if the party filing the appendix is represented by counsel) with the clerk of
this Court. The electronic copies must be filed on twelve separate CDs or DVDs and must be filed in Adobe

Acrobat Portable Document Format (PDF). 1



                                        A Copy,

                                               Teste:

                                                                     Cynthia L. McCoy, Clerk

                                                        original order signed by a deputy clerk of the
                                               By:      Court of Appeals of Virginia at the direction
                                                        of the Court

                                                                     Deputy Clerk




       1
       The guidelines for the creation and submission of a digital brief package can be found at
www.courts.state.va.us, in the Court of Appeals section under “Resources and Reference Materials.”
                                                     -2-
                                           COURT OF APPEALS OF VIRGINIA


            Present: Judges Petty, Chafin and Senior Judge Bumgardner
PUBLISHED


            Argued at Salem, Virginia


            KEPA, INC., d/b/a
             SHE-SHA CAFÉ AND HOOKAH LOUNGE
                                                                                       OPINION BY
            v.      Record No. 1164-12-3                                         JUDGE TERESA M. CHAFIN
                                                                                      APRIL 9, 2013
            VIRGINIA DEPARTMENT OF HEALTH


                             FROM THE CIRCUIT COURT OF MONTGOMERY COUNTY
                                             Colin R. Gibb, Judge

                            Andrew P. Connors (James R. Creekmore; Keith Finch; The
                            Creekmore Law Firm, PC, on briefs), for appellant.

                            Karri B. Atwood, Assistant Attorney General (Kenneth T. Cuccinelli,
                            II, Attorney General, on brief), for appellee.


                    Appellant Kepa, Inc. challenges the ruling by the Circuit Court of Montgomery County

            upholding the Virginia Department of Health’s determination that She-Sha Café and Hookah

            Lounge is not exempt from compliance with the regulations of the Virginia Indoor Clean Air Act.

            For the reasons that follow, we affirm the circuit court’s ruling.

                                                       BACKGROUND

                    Appellant owns and operates She-Sha Café and Hookah Lounge (“She-Sha”) in

            Blacksburg, Virginia. She-Sha has been in operation since 2003 and sells flavored tobacco

            products for its customers to use on the premises by smoking the tobacco through a hookah.1

            Customers may purchase the tobacco for off-premises use as well. In addition to the

            hookah-related transactions, She-Sha offers customers a menu of food and beverage items. The


                    1
                    A hookah is a “pipe for smoking that has a long flexible tube whereby the smoke is
            cooled by passing through water.” Webster’s Third New International Dictionary 1088 (2002).
Town of Blacksburg issued She-Sha a business license based on a December 2, 2009 application

listing the business as a “restaurant and retail tobacco store.” She-Sha holds a valid permit from

the Virginia Department of Health (“the Department”) as a full service restaurant. She-Sha is

also licensed by the Commonwealth of Virginia Department of Taxation as an “Other Tobacco

Products Retailer.”

       On January 22, 2010, the Department received a complaint claiming that She-Sha was

allowing patrons to smoke within its establishment in violation of the Virginia Indoor Clean Air

Act (“VICAA”). On January 27, 2010, in a Food Establishment Evaluation Report (“the

report”), She-Sha was cited by the Department for two noncritical violations of the VICAA: an

individual was smoking in the building and the facility failed to post “no smoking” signs.2

       To contest the violations, appellant requested an informal fact finding hearing, which was

held on March 22, 2010. By letter dated July 8, 2010, the Department upheld its determination

that She-Sha was “properly labeled as a restaurant and that . . . none of [the exceptions to

VICAA] apply to She-Sha.” The letter noted that a restaurant under VICAA is “any place where

food is served,” and the term “shall include any bar or lounge area that is part of such

restaurant.” It also noted that the smoking ban applies to hookah use, as it involves “the carrying

or holding of any lighted pipe . . . or any other lighted smoking equipment, or the lighting,

inhaling, or exhaling of smoke [from] a pipe . . . .” In conclusion, the Department found that

She-Sha was a restaurant because it served food, and even if the hookah lounge was considered a

bar or lounge area, the VICAA expressly subjected such areas to its terms.




       2
         Code § 15.2-2825(D) requires that restaurants subject to the smoking ban post “signs
stating ‘No Smoking’ or containing the international ‘No Smoking’ symbol . . . clearly and
conspicuously.”
                                              -2-
       Appellant then requested a formal adjudicatory hearing. Appellant also renewed its

request for a summary case decision by the Department pursuant to Code § 2.2-4020.1.3 In its

request, appellant stipulated that She-Sha was a restaurant as defined in the VICAA. By letter

dated October 12, 2010, the State Health Commissioner informed appellant that a summary case

decision was inappropriate at that time, but the Department would consolidate the summary case

decision proceeding with the formal hearing appellant had requested.

       The formal hearing was conducted on March 15, 2011. On May 19, 2011, the hearing

officer recommended nine findings of fact and conclusions of law. The Department issued its

case decision on June 17, 2011, in which the Health Commissioner adopted the hearing officer’s

recommendations. The case decision upheld the violations noted in the report and stated that

She-Sha is a restaurant subject to the regulations of the VICAA.

       Appellant petitioned the Circuit Court of Montgomery County on August 12, 2011 for an

appeal of the Department’s final decision in accordance with Code §§ 2.2-4026 and 2.2-4027.

Upon consideration of the pleadings and argument of the parties, the circuit court found that the

Department made no error of law and dismissed the appeal with prejudice. The court opined that

it believed She-Sha should be exempt from the VICAA, but that the statute as written does not

allow for its exemption. Appellant now challenges the circuit court’s ruling.

                                         I. ANALYSIS

       The issue on appeal is whether She-Sha is exempt from complying with the restaurant

smoking ban contained in the VICAA. Appellant argues that the circuit court erred in upholding

the Department’s case decision because She-Sha is a retail tobacco store and the applicability

provisions of the VICAA exempt retail tobacco stores from regulation by the other provisions


       3
         This “renewed request” is the only request contained in the agency record; the initial
request was not included.

                                               -3-
within the Act. The Department maintains that even if She-Sha is a retail tobacco store, it is also

a restaurant and the VICAA prohibits smoking in restaurants. The Department also contends

that the VICAA provides express exemptions to the restaurant smoking ban, none of which apply

to She-Sha.

       The Virginia Administrative Process Act (“VAPA”) authorizes judicial review of agency

decisions. See Code § 2.2-4027. Under settled principles, the burden is upon the party appealing

such a decision to demonstrate error. Avante at Roanoke v. Finnerty, 56 Va. App. 190, 197, 692

S.E.2d 277, 280 (2010); Carter v. Gordon, 28 Va. App. 133, 141, 502 S.E.2d 697, 700-01 (1998).

“Our review is limited to determining (1) ‘[w]hether the agency acted in accordance with law;’

(2) ‘[w]hether the agency made a procedural error which was not harmless error;’ and

(3) ‘[w]hether the agency had sufficient evidential support for its findings of fact.’” Avante at

Roanoke, 56 Va. App. at 197, 692 S.E.2d at 280 (quoting Johnston-Willis, Ltd. v. Kenley, 6

Va. App. 231, 242, 369 S.E.2d 1, 7 (1988)).

       The reviewing court must determine “‘whether substantial evidence exists in the agency

record to support the agency’s decision. The reviewing court may reject the agency’s findings of

fact only if, considering the record as a whole, a reasonable mind would necessarily come to a

different conclusion.’” John Doe v. Virginia Bd. of Dentistry, 52 Va. App. 166, 175, 662 S.E.2d

99, 103 (2008) (quoting Johnston-Willis, Ltd., 6 Va. App. at 242, 369 S.E.2d at 7). See Virginia

Real Estate Comm’n v. Bias, 226 Va. 264, 269, 308 S.E.2d 123, 125 (1983) (“The phrase

‘substantial evidence’ refers to ‘such relevant evidence as a reasonable mind might accept as

adequate to support a conclusion.’” (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197,

229 (1938))).

       On appeal from an agency’s determination of law,

                “where the question involves an interpretation which is within the
                specialized competence of the agency and the agency has been
                                                -4-
               entrusted with wide discretion by the General Assembly, the
               agency’s decision is entitled to special weight in the courts[, and]
               . . . ‘judicial interference is permissible only for relief against
               arbitrary or capricious action that constitutes a clear abuse of
               delegated discretion.’”

Evelyn v. Commonwealth, 46 Va. App. 618, 624, 621 S.E.2d 130, 133 (2005) (alteration in

original) (quoting Johnston-Willis, 6 Va. App. at 244, 369 S.E.2d at 8). Generally, however,

“[a]n agency’s legal interpretations of statutes is accorded no deference because we have long

held that pure statutory interpretation is the prerogative of the judiciary, and thus, Virginia courts

do not delegate that task to executive agencies.” Commonwealth ex rel. Va. State Water Control

Bd. v. Blue Ridge Envtl. Def. League, Inc., 56 Va. App. 469, 481, 694 S.E.2d 290, 296 (2010)

(citations and internal quotation marks omitted); see Virginia Dep’t of Health v. NRV Real

Estate, LLC, 278 Va. 181, 185, 677 S.E.2d 276, 278 (2009) (“Although decisions by

administrative agencies are given deference when they fall within an area of the agency’s

specialized competence, issues of statutory interpretation fall outside those areas and are not

entitled to deference on judicial review.” (citation omitted)). Accordingly, we conduct a de

novo review of the agency’s interpretation of the statutes in dispute. Id.

                                 The Virginia Indoor Clean Air Act

       “Statutory interpretation is a question of law which we review de novo, and we determine

the legislative intent from the words used in the statute, applying the plain meaning of the words

unless they are ambiguous or would lead to an absurd result.” Wright v. Commonwealth, 278

Va. 754, 759, 685 S.E.2d 655, 657 (2009). The Virginia Supreme Court has long held that

“when analyzing a statute, we must assume that ‘the legislature chose, with care, the words it

used . . . and we are bound by those words as we interpret the statute.’” City of Virginia Beach

v. ESG Enters., 243 Va. 149, 153, 413 S.E.2d 642, 644 (1992) (quoting Barr v. Town and

Country Properties, 240 Va. 292, 295, 396 S.E.2d 672, 674 (1990)). “‘Where the legislature has


                                                 -5-
used words of a plain and definite import the courts cannot put upon them a construction which

amounts to holding the legislature did not mean what it has actually expressed.’” Tazewell

County Sch. Bd. v. Brown, 267 Va. 150, 162, 591 S.E.2d 671, 676-77 (2004) (citation omitted).

       Further, “when a given controversy involves a number of related statutes, they should be

read and construed together in order to give full meaning, force, and effect to each.” Ainslie v.

Inman, 265 Va. 347, 353, 577 S.E.2d 246, 249 (2003) (citing Kole v. City of Chesapeake, 247

Va. 51, 56, 439 S.E.2d 405, 408 (1994)). “Proper construction seeks to harmonize the provisions

of a statute both internally and in relation to other statutes.” Hulcher v. Commonwealth, 39

Va. App. 601, 605, 575 S.E.2d 579, 581 (2003). Indeed, “statutes are not to be considered as

isolated fragments of law, but as a whole, or as parts of a great, connected homogenous system,

or a simple and complete statutory arrangement.” Id. at 606, 575 S.E.2d at 581 (quoting Moreno

v. Moreno, 24 Va. App. 190, 198, 480 S.E.2d 792, 796 (1997)) (internal quotation marks

omitted).

       The VICAA as currently enacted became effective on December 1, 2009. The main

provision at issue in this case involves the restaurant smoking ban contained in Code

§ 15.2-2825. Code § 15.2-2825(A) states that “smoking shall be prohibited and no person shall

smoke in any restaurant in the Commonwealth . . . .” The inspection and regulation of

restaurants is within the general purview of the Department, and pursuant to Code

§ 15.2-2825(I), “[a]ny local health department shall, while inspecting a restaurant as otherwise

required by law, inspect for compliance with [Code § 15.2-2825].” “Restaurant” is defined by

Code § 15.2-2820 as “any place where food is prepared for service to the public on or off the

premises, or any place where food is served. . . . ‘Restaurant’ shall include any bar or lounge area




                                               -6-
that is part of such restaurant.”4 It was both acknowledged by appellant and determined by the

Department that She-Sha is a place where food is served; therefore, She-Sha plainly fits the

statute’s definition of “restaurant.”

       As a restaurant, She-Sha must comply with the restaurant smoking ban, unless it falls

within one of the six expressly stated exemptions to this section of the VICAA set forth in Code

§ 15.2-2825(A)(1)-(6):

               1. Any place or operation that prepares or stores food for
               distribution to persons of the same business operation or of a
               related business operation for service to the public. Examples of
               such places or operations include the preparation or storage of food
               for catering services, pushcart operations, hotdog stands, and other
               mobile points of service;

               2. Any outdoor area of a restaurant, with or without roof covering,
               at such times when such outdoor area is not enclosed in whole or
               in part by any screened walls, roll-up doors, windows or other
               seasonal or temporary enclosures;

               3. Any restaurants located on the premises of any manufacturer of
               tobacco products;

               4. Any portion of a restaurant that is used exclusively for private
               functions, provided such functions are limited to those portions of
               the restaurant that meet the requirements of subdivision 5;

               5. Any portion of a restaurant that is constructed in such a manner
               that the area where smoking may be permitted is (i) structurally
               separated from the portion of the restaurant in which smoking is
               prohibited and to which ingress and egress is through a door and
               (ii) separately vented to prevent the recirculation of air from such
               area to the area of the restaurant where smoking is prohibited. At
               least one public entrance to the restaurant shall be into an area of
               the restaurant where smoking is prohibited. For the purposes of
               the preceding sentence, nothing shall be construed to require the

       4
         “Bar or lounge area” is defined in the same code section to mean “any establishment or
portion of an establishment devoted to the sale and service of alcoholic beverages for
consumption on the premises where the sale or service of food or meals is incidental to the
consumption of the alcoholic beverages.” Code § 15.2-2820. Even though She-Sha is named
“She-Sha Café and Hookah Lounge,” it does not fit within the Code’s definition of “lounge”
because it is not devoted to the sale and service of alcoholic beverages.

                                               -7-
               creation of an additional public entrance in cases where the only
               public entrance to a restaurant in existence as of December 1,
               2009, is through an outdoor area described in subdivision 2; and

               6. Any private club.

(Emphasis added).

       Appellee argues for application of the maxim expressio unius est exclusio alterius,

meaning “the expression of one thing is the exclusion of another.” This maxim is a fundamental

principle of statutory construction which gives rise to the implication that “‘omitted terms were

not intended to be included within the scope of the statute.’” See, e.g. Conkling v.

Commonwealth, 45 Va. App. 518, 522, 612 S.E.2d 235, 237 (2005) (quoting Commonwealth v.

Brown, 259 Va. 697, 704-05, 529 S.E.2d 96, 100 (2000)). Applying this principle to the statute

at hand, the legislature included certain express exemptions to the restaurant smoking ban,

implying that any restaurant that fails to meet the criteria for at least one of the stated exemptions

is not exempt from compliance with the smoking ban.

       She-Sha does not fit within any of the six stated exemptions. She-Sha does not prepare

or store food for distribution as a catering service or other mobile point of service. It does not

operate an outdoor, non-enclosed area of its restaurant. She-Sha is not a private club, nor is it

used exclusively for private functions. There is no portion of She-Sha that is structurally

separate and separately vented from smoking areas. And most pertinently, She-Sha is not a

restaurant located on the premises of a manufacturer of tobacco products. Tobacco

manufacturing facilities are referenced elsewhere in the VICAA in conjunction with retail

tobacco stores and tobacco warehouses. Retail tobacco stores and tobacco warehouses, however,

are missing from the exemption language in Code § 15.2-2825(A)(3). The legislature’s express

inclusion of tobacco manufacturers and exclusion of retail tobacco stores and tobacco




                                                -8-
warehouses is evidence of the intent that the latter be subject to compliance with the restaurant

smoking ban.

       Appellant argues that Code § 15.2-2821, governing applicability of the VICAA, takes

precedence over the restaurant smoking ban contained in the subsequent provisions of the

chapter and exempts She-Sha from compliance. Code § 15.2-2821 provides: “Nothing in this

chapter shall be construed to: 1. Permit smoking where it is otherwise prohibited or restricted by

other applicable provisions of law; or 2. Regulate smoking in retail tobacco stores, tobacco

warehouses, or tobacco manufacturing facilities.”5 (Emphasis added). Appellant asserts that

She-Sha is a retail tobacco store and heavily emphasizes the language “[n]othing in this chapter

shall be construed to regulate smoking in retail tobacco stores.” Appellant claims the

Department ignored this controlling language in determining that She-Sha is not exempt from the

VICAA.

       Appellant’s interpretation of Code § 15.2-2821 is inconsistent with Code § 15.2-2825.

Since interpretation of multiple, related statutory provisions must give full effect to each

provision while remaining true to the purpose and intent behind them, Code §§ 15.2-2821 and

15.2-2825 must be construed together. As discussed above, smoking is “otherwise prohibited” in

non-exempt restaurants by Code § 15.2-2825. If Code § 15.2-2821 was intended by the

legislature to provide a blanket exemption for tobacco warehouses, tobacco manufacturing

facilities, and retail tobacco stores not operated exclusively as such, then there would have been

no need for the legislature to expressly exempt restaurants on the premises of tobacco

manufacturers later in Code § 15.2-2825(A)(3). Since these facilities would already be covered



       5
         The statute does not define “retail tobacco store,” and no finding of fact was made as to
whether She-Sha is a retail tobacco store as contemplated by the statute. Such a finding is
unnecessary, however, in light of the trial court’s finding that She-Sha is a restaurant, and thus
subject to the VICAA.
                                                -9-
by Code § 15.2-2821, such an interpretation effectively renders the exemption in Code

§ 15.2-2825 meaningless. Further, Code § 15.2-2825 regulates smoking in restaurants, not retail

tobacco stores. Thus, it does not conflict with Code § 15.2-2821.

       For these reasons, we reject appellant’s arguments. Even though appellant recognizes

that She-Sha can simultaneously be both a retail tobacco store and a restaurant, it seeks to be

treated as one to the exclusion of the other, and thereby circumvent the statutory obligations

associated with being a restaurant. The statutory provisions read in conjunction with each other

show that the legislature did not intend an all-encompassing exemption for retail tobacco stores

not operating exclusively as such. Even if it were to be determined that She-Sha is a retail

tobacco store as contemplated by the VICAA, She-Sha is also a restaurant as defined by the

statute, and She-Sha does not fall within any of the stated exemptions to the restaurant smoking

ban. Without an applicable exemption, She-Sha must comply with the VICAA restaurant

smoking ban, including posting the appropriate signs and prohibiting patrons from smoking.

                                          Attorney’s Fees

       Appellant requests it be granted attorneys’ fees and costs associated with the proceeding

pursuant to Code § 2.2-4030. This section provides as follows:

               In any civil case brought under Article 5 (§ 2.2-4025 et seq.) of
               this chapter . . . in which any person contests any agency action,
               such person shall be entitled to recover from that agency . . .
               reasonable costs and attorneys’ fees if such person substantially
               prevails on the merits of the case and the agency’s position is not
               substantially justified, unless special circumstances would make an
               award unjust.

Code § 2.2-4030(A). Where a party does not substantially prevail on the merits of the case and

the agency’s position is substantially justified, attorneys’ fees and costs will not be awarded.

       For the reasons stated above, appellant did not substantially prevail on the merits of the

case and the Department’s position was substantially justified. Appellant’s argument for

                                               - 10 -
exemption from the VICAA was rejected, and the Department’s case decision was upheld as a

reasonable interpretation of the statutory provisions. In light of this outcome, it is inappropriate

to award appellant attorneys’ fees and costs.

                                        III. CONCLUSION

       Because She-Sha is a restaurant as contemplated by the VICAA, it is subject to the

restaurant smoking ban and must comply with its requirements. She-Sha does not fall within any

of the stated exemptions to the restaurant smoking ban, and the VICAA does not provide an

all-encompassing exemption for retail tobacco stores that simultaneously operate as a restaurant

subject to the VICAA smoking ban. Interpreting the VICAA as such would render other

provisions of the statute superfluous. For these reasons, the circuit court did not err in upholding

the Department’s decision that She-Sha was not exempt from compliance with the VICAA.

                                                                                           Affirmed.




                                                - 11 -
Petty, J., dissenting.

        In analyzing statutes, we employ principles of statutory construction to construe those

statutes in a way that comports with the intent of the legislature. Indeed, the majority uses

several such principles in order to construe Code § 15.2-2825 in a way that would prohibit

smoking in the She-Sha Café and Hookah Lounge, a business that unquestionably is engaged in

the retail sale of tobacco products.6 In doing so, however, the majority ignores the express intent

of the General Assembly prohibiting such construction. The plain and unambiguous language of

Code § 15.2-2821 explicitly states that “[n]othing in this chapter shall be construed to . . .

[r]egulate smoking in retail tobacco stores, tobacco warehouses, or tobacco manufacturing

facilities.” (Emphasis added). Accordingly, by doing exactly what Code § 15.2-2821 expressly

prohibits, the majority glosses over the plain language of the statute and applies the Indoor Clean

Air Act to a business the General Assembly clearly intended to exclude. Therefore, I dissent.

        The General Assembly passed the Indoor Clean Air Act in 1990 as Chapter 28 of Title

15.2 of the Virginia Code. The Act banned smoking in various government buildings and in

some public areas. It also required certain restaurants to provide separate smoking and

non-smoking areas. See Code §§ 15.2-2800 to -2810. In 2009, the General Assembly repealed

Chapter 28 and replaced it with Chapter 28.2. The new Indoor Clean Air Act banned smoking in




        6
         The business model for She-Sha involves charging patrons for a flavored, wet tobacco
which is heated by a burning coal and then smoked through a water-filled pipe known as a
hookah. She-Sha sells tobacco and tobacco-related products as well as food and alcohol to its
customers. However, it derives the majority of its revenue from the sale of tobacco. Tobacco
and tobacco-related sales, e.g., hookah rentals, accounted for sixty-six to sixty-seven percent of
She-Sha’s revenue in the three months preceding the citations from the Department of Health.
These sales figures have been consistent since September 2008. She-Sha has a license from the
Virginia Department of Taxation classifying it as an “Other Tobacco Products Retailer.” As of
February 2010, She-Sha has paid over $7,200 in taxes, as required for retail tobacco sales. While
food and alcohol are also sold, the revenue from these sales is less than one-third of the total
revenue.
                                               - 12 -
all restaurants and bars in the Commonwealth. See Code § 15.2-2825.7 However, the General

Assembly carried over an express provision from the repealed Act that exempted retail tobacco

stores from any of the Act’s provisions that regulated smoking. Code § 15.2-2821. Thus, it

would seem to me that before we engage in an analysis of whether She-Sha is a restaurant as

defined in Code § 15.2-2820, or whether the Department of Health may enforce the provisions of

the Act pertaining to restaurants, we first must determine if the business is a retail tobacco store.

If it is, no amount of statutory-construction gymnastics can overcome the definite and precise

language of Code § 15.2-2821—“[n]othing in this chapter shall be construed to regulate smoking

in retail tobacco stores . . . .” In other words, if She-Sha is a retail tobacco store, we do not need

to concern ourselves with any of the provisions of the Indoor Clean Air Act, including its

definition of a restaurant, because they simply do not apply.

       Nevertheless, the majority concludes that because She-Sha meets the definition of a

restaurant, as defined in Code § 15.2-2820, the Indoor Clean Air Act applies to it regardless of

whether it is primarily a retail tobacco store. This conclusion is based upon the assumption that

the General Assembly did not intend to exempt from Code § 15.2-2825 those businesses

mentioned in Code § 15.2-2821, if that business also operates as a restaurant. Specifically, the

majority reasons that smoking is prohibited in any establishment that prepares or serves food to

the public unless the establishment is specifically exempted by Code § 15.2-2825(A). In

advancing its construction of the Act, the majority points to the specific exemption in Code

§ 15.2-2825(A) for “any restaurants located on the premises of any manufacturer of tobacco

products.” The majority states that because a tobacco manufacturing facility is also specifically

exempted in Code § 15.2-2821, the General Assembly intended for Code § 15.2-2825 to apply to


       7
         Code § 15.2-2825(A) provides various exemptions to the restaurant smoking ban. The
only Code § 15.2-2825(A) exemption at issue in this case is an exemption for “restaurants
located on the premises of any manufacturer of tobacco products.” Code § 15.2-2825(A)(5).
                                             - 13 -
any business listed in Code § 15.2-2821 unless there is a specific exemption in Code

§ 15.2-2825(A). The majority applies the statutory construction principle of expressio unius est

exclusio alterius to reach the conclusion that “[t]he legislature’s express inclusion of tobacco

manufacturers and exclusion of retail tobacco stores and tobacco warehouses is evidence of the

intent that the latter be subject to compliance with the restaurant smoking ban.”

       This conclusion stands in stark contrast to the plain language of the relevant statutory

provisions. Code § 15.2-2821 exempts “tobacco manufacturing facilities” from the application

of the Indoor Clean Air Act. Code § 15.2-2825(A) exempts restaurants “located on the premises

of any manufacturer of tobacco products” from the application of the Indoor Clean Air Act.

“Tobacco manufacturing facilities” and “premises of any manufacturer of tobacco products,” as

used in the Indoor Clean Air Act, are not synonymous; they describe completely different

things.8 We know this to be true because

               “[w]e look to the plain meaning of the statutory language, and
               presume that the legislature chose, with care, the words it used
               when it enacted the relevant statute.” Moreover, when the General
               Assembly has used specific language in one instance, but omits
               that language or uses different language when addressing a similar
               subject elsewhere in the Code, we must presume that the difference
               in the choice of language was intentional.

Zinone v. Lee’s Crossing Homeowner’s Ass’n, 282 Va. 330, 337, 714 S.E.2d 922, 925 (2011)

(quoting Addison v. Jurgelsky, 281 Va. 205, 208, 704 S.E.2d 402, 404 (2010)).

       While the Indoor Clean Air Act does not provide a definition for “tobacco manufacturing

facilities,” as used in Code § 15.2-2821, Code § 15.2-2820 does provide a definition for

“facility,” as used in connection with other terms in the Indoor Clean Air Act: “‘Educational


       8
          I note that the premises of Philip Morris USA, a tobacco manufacturer in the Richmond
area, is “[l]ocated on a 200-acre site.” However, the actual tobacco manufacturing facilities on
this premises consist of “six connected buildings that cover a total of 43 acres.” Offices &
Facilities, Philip Morris USA, http://www.philipmorrisusa.com/en/cms/Company/Corporate
_Structure/Offices_Facilities/default.aspx?src=top_nav (last visited February 19, 2013).
                                               - 14 -
facility’ means any building used for instruction of enrolled students”; “‘Health care facility’

means any institution, place, building, or agency . . . .”; “‘Recreational facility’ means any

enclosed, indoor area used by the general public and used as a stadium, arena, skating rink, video

game facility, or senior citizen facility.” Looking at the various definitions of “facility” in the

Indoor Clean Air Act, the common theme running throughout each one is that “facility” includes

some type of building or structure which facilitates the desired function. Indeed, the plain and

ordinary meaning of facility is “something (as a hospital, machinery, plumbing) that is built,

constructed, installed, or established to perform some particular function or to serve or facilitate

some particular end.” Webster’s Third New International Dictionary 812 (1981). Thus, the

plain meaning of “tobacco manufacturing facility” is some type of building or structure which

facilitates the manufacture of tobacco.9

       The Indoor Clean Air Act does not provide a definition for “premises of any

manufacturer of tobacco products.” However, the key term in this phrase, for our purposes, is




       9
         This definition accords with the definition of “manufacturing facility” used in Code
§ 15.2-5000. Although, Code § 15.2-5000 is not applicable here, and it specifically states that
the definition is to be used for bonding purposes only, it is nonetheless instructive in our quest
for an acceptable definition of tobacco manufacturing facilities. Code § 15.2-5000 states,

               “Manufacturing facility” means (i) any facility which is used in the
               manufacturing or production of tangible personal property,
               including the processing resulting in a change of condition of such
               property, (ii) any facility which is used in the creation or
               production of intangible property as described in
               § 197(d)(1)(C)(iii) of the Internal Revenue Code of 1986, as
               amended, to be any patent, copyright, formula, process, design,
               pattern, knowhow, format, or other similar item, or (iii) any facility
               which is functionally related and subordinate to a manufacturing
               facility if such facility is located on the same site as the
               manufacturing facility.
                                                  - 15 -
“premises.” The plain and ordinary meaning of premises is “a specified piece or tract of land

with the structures on it,” or “the place of business of an enterprise or institution.” Webster’s,

supra, at 1789. Thus, “premises of any manufacturer of tobacco products” would include any

land with structures on it that a tobacco manufacturer uses as its place of business.

       Accordingly, “premises,” as used in Code § 15.2-2825(A), has a different meaning than

“facilities,” as used in Code § 15.2-2821. Code § 15.2-2821 exempts tobacco manufacturing

facilities from the Indoor Clean Air Act. This means that any buildings or structures which

facilitate the manufacture of tobacco are exempt from the Indoor Clean Air Act under Code

§ 15.2-2821. This exemption would apply to restaurants located within a tobacco manufacturing

facility; it would not apply to restaurants located on the premises of a tobacco manufacturer.

This is where Code § 15.2-2825(A) presumably fills the gap left by Code § 15.2-2821. Code

§ 15.2-2825(A) exempts “restaurants located on the premises of any manufacturer of tobacco

products.” This means that a restaurant located on land with structures on it that the tobacco

manufacturer uses as its place of business is exempt from the Indoor Clean Air Act under Code

§ 15.2-2825(A). Accordingly, a tobacco manufacturer could have a restaurant in its

manufacturing facility, and that restaurant would be exempt from the Indoor Clean Air Act under

Code § 15.2-2821. On the other hand, a tobacco manufacturer could have a stand-alone

restaurant located on its premises, and that restaurant would be exempt from the Indoor Clean

Air Act under Code § 15.2-2825(A).

       The language of Code § 15.2-2821 is clear. If a business is a retail tobacco store, tobacco

warehouse, or tobacco manufacturing facility, then it is exempt from all provisions of the Indoor

Clean Air Act. Nothing in the Indoor Clean Air Act can be construed to regulate smoking in the

business.




                                                - 16 -
       The Department of Health argues that a restaurant could avoid the requirements of the

Indoor Clean Air Act by selling packets of cigarettes and labeling itself as a retail tobacco store.

Indeed, a restaurant’s ability to masquerade as a retail tobacco store would undermine the

General Assembly’s purpose in implementing the Indoor Clean Air Act. I am not unmindful of

the Department’s public policy concerns. Accordingly, I would adopt a primary purpose test to

determine whether a business is a retail tobacco store, and therefore, exempt from the provisions

of the Indoor Clean Air Act under Code § 15.2-2821. In order for a business to fall under the

Code § 15.2-2821 exemption for a retail tobacco store, the primary purpose of the business must

be the sale of tobacco. I do not propose a bright-line, formulaic approach to the classification of

a business. Instead, the primary purpose of a business can be determined by looking at the

totality of the evidence, including whether the business derives the majority of its revenue from

the sale of tobacco. Both the Department and the trial court refused to determine whether

She-Sha was a tobacco retail store. Because of this refusal, I would remand this case to the trial

court with instructions to remand to the Department of Health for it to make a determination

whether She-Sha is a retail tobacco store and thus exempt from the operation of the Indoor Clean

Air Act.




                                               - 17 -
