                  December 21, 1971

Hon. 0. N. Humphreys, Jr.          Opinion No. M-1015
Administrator, Texas Alcoholic
   Beverage Commission             Re:   Whether a private
P. 0. Box 13127, Capitol Station         club permittee lo-
Austin, Texas 78711                      cated in a dry area,
                                         which private club
                                         also holds a beverage
                                         cartage permit, may
                                         purchase beer from a
                                         beer distributor of
                                         the type provided for
                                         in Article 667-3, (b),
                                          (c), and (d), V.P.C.,
                                         at the premises of
                                         such distributor and
                                         transport such beer to
Dear Mr. Humphreys:                      its own premises.
          your opinion request dated August 27, 1971, has been
received and considered by this department. We quote from your
letter as follows:
               "May the holder of a Private Club Reg-
          istration Permit issued for a premises lo-
          cated in a dry area, who also holds a
          Beverage Cartage Permit, purchase beer from
          a beer distributor of the type provided for
          in Article 667-3, (b), (c), and (d), V.P.C.,
          at the premises of such distributor and
          transport such beer to its own premises."
          We conclude that the question must be answered in the
affirmative.
          Several portions of the Texas Liquor Control Act must
be considered. The one which,has.given us the most concern was
enacted by the last.Texas Legislature (Acts 62nd Leg., R.S., 1971,
Ch. 65, p. 681, Sec. 15, at p. 692-3, codified by Vernon as
Article 666-20(e), V-.P.C.).*

*All Articles mentioned are from Vernon's Penal Code.
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Hon. 0. N. Humphreys, page 2.,   (M-1015)



               "All distilled spirits sold by a Mixed
          Beverage Permittee or a Private Club Permittee
          mu-t be purchased in this State:from a holder
          of a Local Distributor's Permit. ,;No local
          distributor-may sell distilled spirits to a
          Mixed Beverage Permittee or a Private Club
          Permittee in individual containers containing
          less than one fluid ounce. No local distri-
          butors may deliver less than two and four-
          tenths gallons of distilled spirits in a sin-
          gle shipment.

               "The Commission or Administrator is
          authorized to issue Local Distributor's Per-
          mits only to holders of Package Store Permits
          issued under the terms of Section 15(8) of
          Article I of the Texas Liquor Control Act.
          A Local Distributor's Permit shall authorize
          the holder thereof to purchase distilled spir-
          its or liquor from holders of Wholesaler's
          Permits issued under the terms of Section 15(6)
          of Article I of the Texas Liquor Control Act
          only, and to sell and distribute to Mixed
          Beverage Permittees or Private Club Permittees
          such brands of distilled spirits, liquor, and
          other alcoholic beverages as are for general
          distribution and'are available from the whole-
          saler to all local distributors.   The fee for
          a Local Distributor's Permit shall be in the
          amount of Fifty Dollars ($50) and shall be
          paid in addition to, and under the same condi-
          tions as, the fee paid for the holder's Pack-
          age Store Permit. Any holder or any agent of
          a holder of a Wholesaler's Permit issued under
          the terms of Section 15(6) of this Article I
          may enter the licensed premises of a Mixed
          Beverage Permittee or a Private Club Permittee
          for the purpose of determining the brands
          offered for sale and suggesting or promoting
          to the extent authorized'by Section 17 (3)(g)
          of~this Article I, the sale of other brands;
          provided, however, that no holder and no agent
          of a holder of a Section 15(6) Wholesaler's
          Permit shall be authorized to accept a direct
          order from a Mixed Beverage Permittee other
          than a direct order for wine or malt liquor.


                              -4950-
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    Hon. 0. N. Humphreys, page 3.      (M-1015)



                   “No holder of a Nonresident Seller’s
              Permit or a Manufacturer’s Agent’s Permit
              issued under Section 15-l/2 of this Article
              I, shall, unless accompanied by the holder
              or the agent of a holder of a Wholesaler’s
              Permit, solicit any business, directly or
              indir~ectly, from a Mixed Beverage Permittee
              or a Private Club Permittee.

                   “Where a Mixed Beverage Permittee or
              a Private Club Permittee is in an area where
              there are no local distributors, the holder
              of a Mixed Beverage Permit or a Private Club
              Permit shall be empowered to purchase alco-
              holic beverages in the nearest area where
              local distributors are located and transport
              same to the premises of the Mixed Beverage
              Permittee or Club; provided the permittee
              transporting such alcoholic beverages is also
              a holder of a Beverage Cartage ~Permit, and
              provide? that such transporter shall~ acquire
              such alcoholic beverages only on the written
              order from the holder of a Mixed Beverage Per-
              mit or officer or manager of the Club and any
              such alcoholic beverages must be accompanied
              by a written statement furnished and signed
              by a local distri.butor, showing the name and
              address of the consignee and consignor, the
              origin and destination of such shipment, and
              such other i,nformation as may be required, by
              the Commission or Administrator; and it shall
              be the duty of the person in charge of such
              alcoholic beverages while they are being so
              transported to exhibit such written state-
              ment to any representative of the Commission
              or any peace officer making demand therefor,
              and such statement shall be accepted by such
              representative or offi.cer as prima facie evi-
              dence of the lawful ri,ght to transport such
              alcohol,ic beverages 0

                   “The Commission is hereby authorized to
              issue a Beverage Cartage Permit to the holder
              of a Mixed Beverage Permi.t or a Private Club
              Permit to transport alcoholic beverages tr the
              licensed premise from the place of purchase.


                                    -4951-
Hon. 0. N. Humphreys, page 4.       (M-1015)



          The holder of a Beveraee Cartage Permit shall
          be privileged to transfer alcoholic beverages
          as herein provided. The annual State fee for
          a Beverage Cartage Permit shall be Ten Dollars
          ($10) .I’

          The Local Distributor’s Permit is new to the Texas
Liquor ,Control Ac,t and appears for the first time in the Section
above quoted adopted by the 62nd Legislature.    This permit may
issue only to Package Store Permit holders as authorized by
Article 666-15(8), which reads as follows:

               “Package Store Permit. A Package Store
          Permit shall authorize the holder thereof to:
               (a). Purchase liquor from,the holders
          in this State of Class A Winery, Class B Winery,
         Wholesaler’s, Class B Wholesaler’s and Wine
         Bottler’s Permits;
               (“1. Sell liquor on or from licensed
          premises at retail to consumer for off-premises
          consumption only and not for the purpose of
          resale, in unbroken original conta?ners only;
                Cd). Sell malt and vinous liquors in
         “orIgina containers of note less than six (6)
          ounces;
                Cd)- Sell vinous liquors, but in quarjti-
          ties of not more than five. (5) gallons ,in-
          original containers in any single transaction.
               ‘(e)- ,Any person holding more than one
          Package Store Permit may designate one of the
          licensed premises as the place for storage of
          liquor, and he shall be privileged to transfer
          liquor to and from such stora.ge’to and from
          his other licensed premises under such rules
          and regulations as may be prescribed by the
          Commission.

               “The annual State fee for 3 Package Store
          Permit in cities and towns shall be based upon
          the population according to the last preceding
          Federal Census as follows:

                                               Fee
                    25;o
                       =F=-0 or less . . . . $125.00
                    25,001   to 75,000 . . . 175.00
                    75,001 or more . . . . 250.00


                                -4952-
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Hon. 0. N. Humphreys, page 5.      (M-1015)



               "The annual State fee for a Package Store
          Permit outside of cities and towns shall be
          One Hundred and Twenty-five Dollars ($125),
          except the annual State fee for a Package Store
          Permit outside of any incorporated city or town
          and within two (2) miles of the corporate limits
          shall be the same as the fee required in said
          incorporated city or town."

           It will be noted that the foregoing quoted portion of
the statute does not authorize the sale of beer at retail for off-
premise consumption.   For a Packa-ge Store Permit holder to be
legally authorized to sell beer, he must also have a Retail Dealer's
Off-Premise License. Article 667-3(f)    provides as follows:

                "Retail Dealer's Off-Premise License.
          A Retail Dealer's Off-Premise License shall
          authorize the holder thereof to sell beer in
          a lawfIll container direct to the consumer,
          but not for resale and not to be opened or
          consumed on or near the premise where sold.
          Annual State fee for a Retail Dealer's Off-
          Premise License shall be Ten Dollars ($lO).'

          A General Distributor's License, a Local Distributor's
License and a Branch Distributor's License are defined in the fol-
lowing subsections of Article 667-3:

                "(b) General Distributor's License.
          A general distributor's license shall authorize
          the holder thereof to distribute or to sell
          beer to other general distributors, branch dis-
          tributors, loca'l distributors, retail dealers,
          ultimate consumers and others only in the un-
          broken original packages in which it is re-
          ceived by him from the manufacturer, general
          distributor, local distributor, or branch dis-
          tributor  and to serve free beer for consumption
          or the licensed prenises. Annual state fee for
          a general distributcr's license shall be Two
          Hundred Dollars ($200,00).

               "(c) Local Distributor's License, A
          local distributor's license shall authorize
          the holder thereof to serve free beer for
          consumption on the licensed premises, and to
          sell and distribute beer to retail dealers
          and ultimate consumers in the county of his
                                -4953-
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Hon. 0. N. Humphreys, page 6.      (M-1015)



          residence only in the unbroken original
          packages in which it is received by him
          from the manufacturer, general distributor,
          branch distributor, or another local distri-
          butor, and to sell and deliver beer to any
          other distributors licensed in this state
          to sell beer. Annual state fee for a local
          distributor’s license shall be Fifty Dollars
          ($50.00).
               “(d) B ranch Distributor’s License.
          The holder of a Manufacturer’s or General
          Distributor’s License after obtaining the
          primary license in the county of his domi-
          cile or residence, may establish other
          places of business in any county wherein
          the sale of beer is legal for the distri-
          bution of beer upon obtaining a Branch Dis-
          tributor’s License for each such place of
          business as herein provided, and such Branch
          Distributor may serve free beer for consump-
          tion on the licensed premises.  . . .’

          The word “beer” is nowhere used in .Article 666-20(e).
The first paragraph of this Section 20(e) requires that all dis-
tilled spirits sold by a Private Club permittee must be purchased
from the holder of a Local Distributor’s Permit. There are no
other words of command or prohibition with regard to the purchase
of alcoholic beverages throughout the remainder of this Section.
The language in its fourth paragraph which may tend to contain
words of command or prohibition are as follows:

               “Where a Mixed Beverage Permittee or a
         Private Club Permittee is in an area where
         there are no local distributors, the holder
         of a Mixed Beverage Permit or a Private Club
         Permit shall be empoweredto purchase alco-
         holic beverages in the nearest ‘area where
         ~local distributors are located. . .‘I

           The question in the instant request relates ,only ,to
private. clubs operating in a county in which a portion thereof
is at least wet for the sale of beer. In counties that are com-
gletely dry private clubs must operate under what is known as the
 Locker System , a system which requires that each individual mem-
ber purchase his own liquor and beer and transport it to the club


                                -4954-
‘      .




    Hon. 0. N. Humphreys, page 7.        (M-1015)



    for storage in an individual locker provided by the club. The
    “Locker System” and “Pool System” are defined in Article 666-15(e),
    Section 1 as follows:

                   ” ‘Locker System’ shall mean that system
              of alcoholic beverages storage whereby the club
              rents to its members lockers wherein the member
              may store alcoholic beverages for consumption by
              himself or his guests. All such alcoholic bev-
              erages so stored under the ‘locker system’ shall
              be purchased and owned by the member as an indi-
              vidual.

                   ” ‘Pool System’ shall mean that system of
              liquor storage where all members of the pool
              participate ~equally in the purchase of all alco-
              holic beverages and the replacement of all alco-
              holic beverages is paid for by moneys assessed
              and collected in advance from each member equally.
              Such pool system shall be legal only in an area
              which has been voted ‘wet’ for alcoholic beverages
              by the majority of voters at an election held
              under local opt ion .”
              *           *          *              *     Y       *

              “(c-2) Notwithstanding any other provision of
              this Section 15 me), the pool system shall be le-
              gal for any private club operating in any county
              where the sale of any alcoholic beverage has been
              legalized, either throughout the entire county
              or any portion of such county.”

              From the fore&oing definitions it can be seen that, in
    the case of a private club operating under the “Locker System” it
    is not permissible to have the beer and li uor transported to the
    club by an agent of the members. Arti,cle :66-4(b)  prohibits the
    transportat io. of liquor or beer in a dry area except by a person
    who has purchased the same for his own consumption at a place where
    the sale thereof was legal and transported the same to a place where
    the possession thereof was legal.

              While the language of Article 666-20(f)    leaves a great
    deal to be desired in clarity of expression, there is no indica-
    tion that the Legislature intended to restrict the sources    of
    purchase of beer by private club permittees.     If such an intention


                                    -4955-
Hon. 0. N. Humphreys, page 8.      (M-1015)



had been desired, the first three words of Article 666-20(e) could
just as easily have been changed to read "all alcoholic beverages".
Such language would then clearly have indicated that the Legisla-
ture intended that such private club permittees purchase theirs beer
from holders of a "Local Distributor's Permit".   Since the Legis-
lature  did not impose any such restriction in this new statute and
since the Legislature d.id not change the authority of 'a holder oft,
a General Distributor~ls License, a Local Distributor's License or
a Branch Distributor's License defined in Article  667-3  it can only
be concluded that the Legislature did not intend to limit the sources
of supply for beer as they did with distilled spirits. The Lan-
guage~ of the fourth paragraph of Article 666-20(e), then, can only
be viewed as dealing with transportation and not with the sources
of supply for the purchase of beer.


                           SUMMARY
                           -------
               A Private Club Permittee operating under
          the ~"Pool System "in a dry area may purchase
          beer from the holder of a General Distributor's
          License, Local Distributor's License, or Branch
          Distributor'sLicense   at the place of business
          of such distributor and transport the same to the
          private club provided (1) that such,club is the
          holder of a Beverage Cartage Permit, (2) that
          such beer is acquired only on the written order
          of an officer or manager of the club, and (3)
          that during the transportation thereof such beer
          is accompanied by a written statement furnished
          and signed by the               selling such beer.

                                         6 very truly,
                                               P-



                                               eneral of Texas

Prepared by Max P. Flusche, Jr.
Assistant Attorney General

APPROVED:
OPINION COMMITTEE

Kerns, Taylor, Chairman
W. E. Allen, Co-Chairman

                                -4956-
Hon. 0. N. Humphreys, page g0      (M-1015)



Larry Craddock
Howard Fender
S. J. Aronson
James Mabry

SAM MCDANIEL
Staff Legal Assistant

ALFRED WALKER
Executive Assistant

NOLA WHITE
First Assfstant




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