BE     mf.-o~~~~ GENERAL
                           OF TEXAS
PRICE DANIEL
ATTORNEYGENERAL



       Honorable Wfllfam N. FIansley
       Criminal District  Attorney
       Bexar County
       San Antonio, Texas            Opinfon HoJo.V-203
                                      Re:   Whether a private olub,
                                            under certain prescribed
                                            oonditions,    would be op-
                                            arating in violation      0r
                                            constitutional    and stat-
                                            utory provisions    relative
                                            to the sale of llc~uor by
                                            the drink; clarification
                                            of previous opinion No.
                                            O-7139, pertaining     there-
                                            to s
       Dear Sir:
                   Your letter of March 20, 1947, reouesting   the
       oplnlon of thls department 61s to the effect   to be accord-
       ed previous   Oplnlon No. O-7139, relative  to the sale of
       liquor in a private club, reads in part as follows:
                  *qWe hereby recuest that your office furnish       us
           with an opin%on as to whether or not you adopt or
           reject Optnfon No, O-7139, approved by your predo-
           cessor on December 20, 1946,
                   “Your predsoeneor delf+erod two oontrary opln-
           ions on the matter Involved,    the above captioned
           oplnlon   bring the last one rendered.    For that roe-
           son, we think it highly advisable     to have the doubt
           thus raised resolved by you atter a re-examination
           and rq’-consideration   of this matter.
                    “In the event that   you adopt this opinion,we
           would greatly approc%atr it it you would furthor
           clarify    same0 This oplinion did not doo9de whether
           or not tha fact sltuatQon presented constituted
           a violation    of the law, but marely stated that
           suoh evidence would make a prima facie case to
           present to a jury0 A mars derinfte      and posPtivr
Eon. William   NJ. Haosley,,     Page      2   (V-203)



   opfnton would be of great .benefit       to both this
   office and the local    office    of the Texas Liquor
   Control Board in d,ecidfng what course of action
   to take with respect to the San Antonfo Club,
   whose operations  constitute      the subject   matter
   of the prcvfous  opinions      and of this request,
   D 0 0 an

           It is an extremely   difficult  task   for this off-
foe to attempt to pass on the application       of a statutory
provision  to a efven situation    which is based upon ques-
tians of fact0    Such questfous of fact are to be deter-
mined by a jury? or by the court in absence of a jury,
and this may be subject   to one construction     by a given
jury panel and to an entirely    different   interpretation
by another9 dependfug upon the oredfbilfty       and weight
placed upon the witnesses and their testimony,        circum-
stantial  avfdence and other matters which cause the
minds of reasonable men to differ,       As you stated fn
your letter,   the writer of Opfnfon Do. O-7139, which
was released 05 December 20, 194ki9~did not pass upon
the given facts as a matter af law, but only that such
evidence would nake .a prime facie     case to present to a
JUrU.
           In order for us to give au opinion as origfge%-
ly requested by the Honorabla Dert yard, Admfnistretcr,
Texas Liquor Control BOardPdthe Banner fn which the San
Antonio Club fa operated s as set aut fn Opinion No, O-
7139, will nacasaarP1y have to be assuaad as the estab-
lished facts ~of the case.   The two lettera  from the Wan-
orable  Bert Ford are set out in full,   fn ardor that wa
My have these radta befOre ua # as r0ii0w8:
            VI11   yau plersr give ~0 your talwd         opinion
      aa to iiktbr       or not a ‘plaoe operated  in the aaa-
      nar fndfmted       below,   where llooholfo bsvsregra    a re
      served s omatltute        tha aperatqon o? an apen saloon.
            “The San Anttoafo Club, a corporatim  duly fn-
      corporated uader tha lawa of the State of Texas,
      is the la~s8e Of approxi~taly    1300 square feet of
      spaae laoatad on the third floor of the Gunter Hotel,
             vThfa space was leased to the San Antonio
      Club for a period of five yeera at an annual
      rent’al of $5,000,00 per year,   The premises were
      leased for occupancy as a prfvatm club and the




                           ,.,   .!   “i
Hon. William   N. Hensley,   Page 3       (V-203)


     lessee agreed to all public laws pertaining              to
     the operation of private olubs.
           “The club comprises three rooms: a reading
     room, a club room, and a dining room. The alub
     is Btaffed vith stewards who are rrsponsible    ior
     the general upkeep of the olub; and these two
     stewards are hired by and their salaries   are
     paid by the San Antonio Club,   Officers  of the
     club and members of the club do not reoeive any
     compensation.
          “The Ounter Hotel strvioes the dining room
     and maintains waiters for both the lunabeon and
     dinner.

           *The club members pay the hotel regular room
     service prices,  less ten per oent dlseoumt ror
     rood*
          “The hotel waiters do not have access to the
     club room, or the reading room. Their aotivitirs
     being confined strictly  to the dining room.
           “There is a service bar in the olub room for
     dispensin~v mixed drinks only to members and their
     guests D
           “The bar is operated under what is knswn as
     the bar pool plan,   Zaah of the seventy-five   club
     members have on deposit in a separate fund $25..OQ
     each, which makes 8 total of $lg75.OC.     This money
     has been pooled tdgether to purchase liquor for
     their personal use:
          Y’Pu~hases of liquor for        the club is made by
     the treasurer from the holder        of A Retail Package
     Store Permit 0
            -In withdrawing, liquor at the bar flom this
     pool, each member uses a ooupon book,     Zaah coupon
     entitles   the member to ane drink.
          “All liquor purchased for the club is plaaed
     on the back bar or is ‘stored in a small roam be-
     hind the bar.
           “Club members obtain       aoupon   boaka   from   the
     etewards o
                                                                        .




Hon. Killiam     K. Hensley,   Page 4        (V-203)


            "At the end of each month the club member is
     billed   for the number of coupon books he has been
     issued,
           "There ara no guest cards for the San Antonio
     Club, and no non-member is allowed in the club room
     unleeo he is a guest ot a m-her.    No guest can ob-
     tain drinka from the bar, but a member may serv6
     hi8 or hei guest a drink, using his or her coupon.
     No money at any time changes hands in the club room.
           "Following     are the house rules          of the club.
           “1.     Bo ladies   permitted     before     5 p.m.
           we.     Emrescorted      ladioa    permitted     at    any


           “3.     Members required to limit their guest&
                   to four -- if more, contact   the bar I%-
                   garding sarvioe before arriving with the
                   guests.
           “4:     No gambling with guests        at any time.
           “5.     No poker allowed.
           “6.     Club   open iTom 11 a. n. to 18 midnight.

           “7.     No slot machines or niokslodeona              per-
                   mitted on the premises.
           “8.     No long distance phone calla           or wires
                   perraitted from house phones.
           *9.     ~;em;~~rs     or guesti    allowed     behind
                           0
           RlO.    Members aannot mix their           own drinks.
           “11.    Ro member ahall be permitted the priv-
                   ilege of bringing the same resident
                   guest oitsner  than once a week,
           “12,    Drinks cannot be served to anyone
                   other than a member, unless accom-
                   panied by a member.
           “130    Yembera are not permitted           to bring
                   their offn liquor.
Hen. w/11 lam NJ. Hensley,      Page 5   (V-203)


          “1 wish te call to youp attention the follow-
     in6 provisiam  af the Texem Liquor Ceatrol Aot:
            “‘Seotieu   3,(a) of’ Article  I.  The tern ‘*open
     sa10on*~ as used in, this Act, means any place where
     any alcohelio     beverage whatever, aaanufactured in
     whole or in part by meatas of the proeass of distil-
     lation,    or any liquor cempoaed or oeapeunded in part
     0r cliatinsd     epirite,  is sold or ofrerad rOT arle
     for beverage purposes by the drink QT in broken or
     unmaled oontainers,       or any plsoe where any auah
     liquors are sold or offered       for sale for human con-
     sumption on the premises where gold. I
           “‘Sootion   3(b) or Article   I.   It shall be ~JP
     lawful far any por$p892), whvthor as principal,      agent
     er angloyer,    to up&rate or rssist    in ooerating,, or
     to be directly    or.‘iadlreatly  Intorested   ia the &per-
     ation or any open saleon in this State.’
           “I also wish to cell your attention    to Opinion
     No. C-1145, approved by the Attorney General’s De-
     partment on August 26, 1939,      It is the contention
     of the San Antonio Club that Attorney General’8 O-
     plaion No. ,O-1145 dooa not cover this situation.      The
     S4n Ant&n10     Club hmtker oontcnds that the manner
     in whfoh it epsrates does not violate     Sectien 3,
     (4)  0r Article    1.”

                             ******

            .mIn sopplmonting  #g letter    or Yaroh 7, 1940,
     re~umWn& an opinion on the operatier          of the San
     Antonio    Olub, a owpomtfon    duly inror eratsd ullder
     the 18~s or the State of Tsxaa, thfa oPub oper-
     ate& on a ooupvn ayrtoa whereby a member may secura
     a ooupoo be$L aontainfng     twenty (20) oaupona, 0r
     which eaah oeapon ItO warth fifty      centsi   .50) eaoh
     nuking    thd eeapon b4Ok 0@4t a total     or i 10,oO.

            “In sach inataaos of where a member pur-
     ohases a drink      of whiskoy, mixed or otherwiao,
     it is necessary      that the msllber and the olub
     atewar    countersi    n eaoh ooupon.   Each  drink  ai
     whiskry 8 aither mx red or otherwise,      has a oest
     or fifty   cents ($,50) regardleas of tha typo
     drink porohased D
           “The club aamber does not pay for       hiB coupon
Hon. William      B. Hensley,    Page 6        (V-203)


       books until the end of the month, at which
       time the secretary bills him for the number
       of coupon books that he has received during
       the month.
            “The treasurer   of the San Antonio Club
       purchases all liquors to be used by the club and
       payment ror these liquors is made from the funds,
       which were originally   set up as explained in my
       previous     letter.          ’

             *Honeys derived from the sale of coupon books
       is placed in the fund at the end of each month,*
           It appears to us that the primary question in-
volved in this situation      is whather there is a sale from
the olub to the individual      members when a drink of whiskey
is served.    The authorities    discussed by the writer of
Opinion lo, O-7139 will be usad bore, in so far as they
are applicable.
              Krnalrek   Y. State,       41 3. 1.   612 (Court of Criri
inal   Appeals)     holds:
              *The question here is whether the sale of
       intoxicants   by the managing steward or barkeeper
       of the club to one of’ the aembers of said club




       seme to an individual   meaber,’ ior whioh he either
       paid tho oeeh, or became responsible     therefor.    D
       0 0 0 e Thir is not a oase where parties contrib-
       ute sums of aonep and purchese intoxicants       there-
       with, and divide them prorata amDnq themselves;
       but it is a transaction   where the common assets
       of a oontinuing business are used to replenish
       the goods sold in that business.     o 0 0w
       (Wmphasis our8 .,1
           Feige   1, State,         95 3.. 1, 506 (Court of Crirfn81
Appeals) s holds ‘.
              *In any event  accondinp to our view,
                        - .I-d--Z--Ad-----                      tl&
Hon. William   W. Menaley,   Page 7    (V*803)




                                                           i3ht
     the beer on its own behalf in Ft. Worth, and if at
     any time the dorpontion    had failed and become
     subject to b;ledutioB,  the bear and pregsrty ot the
     same could have been seized for the debts oi’ suah
     corporetioa.   When the beer was brought irem Ft *.




           Adaaa v. Stat.,    L45 8. W. 940 (Court ei Crieiin-
al Appeals) , holdr:
            “The questiens presented for Ow asn8idera-
     tion,ara    but two:   Did the transaotion   eenatitute
     a sale wlttin the maani       or our law6, and, . . .
     The evilenas shows that T he inuorpanted       club   pur-
     chased liquors in bulk with naoaay in th6 treasury,
     end sold or dispensed the liquors to its members
     at the u.mal    or customary  priaa.    This we thfnk
     osnstitutes    a sal.e under all the rules Or law.
     fr my giomn nukaber Or persrpagorgaqif4e un ~.ss(P-
     ~ciatien uniter any name whatsoever with the uadar-




            Prom the authoritiee     cited,   supra, and aany other
autherities   faund by a oareful     asarCh in conneotion with
th0 quaatle~a 5nvalnM in tlsis request, we are af the op-
inion that m&&er the ijets     w&i&,     as stated  at the outset,
we ara neaaa~~iZy #MN&&M to 06 establishmd,                re is a
*iaalew or whfs.key fz?om the 0luh or steward au
the club to the members. The facte stated im t             f;iE
~~oaseaare not ~iseiail~ar   to the facts involved fn the ep-
e&tfon ef Zhe San Antonio Club as set out In the letters
from the WonerebLe Bert Ford. Under such hsl&iElps , the
aanner in wMOh t$b Sea Aattonio        Olab la beiq   eantfacted
                        , ,.,




Eon. William   W. Hensley,      Page B   (V-203)


16 olearly   in violation     of Article    666-3, Paragraph (a)
e? T~rnon’s Penal Coda of Texas.          Tha money whioh each
mamber’places in the WpoolW, becomes the common property
or the club,    Andythe liquor    purohaae& by the treasurer
with this money becomes the property of the club. There-
fore, when a drink is served to an individual           member and
he beoomes llabla for the “ooupon” given for suoh drink,
it Is a wealc* or the property or the club to the member.
We concede that then members or the San Antonio Club a.0
not have the intention       or dianorition    to violate  the pro-
visions   or the Texas Liquor Control A&, but, in visw 0r
the authorities    relative    to what oonatitutes     a sale in
6uoh cases, we are bound to hold that such aonduot doer
amount to a violation       of ths herslnabove mentioned pre-
vision6 0r the Penal Coda.
             Upon determining that a %ala” is made by the
Club or by the steward, as agent for the club, to the
members, the next question &nvolved is whether such a
sale under Artiolo     666-3, Ptirrgraph (a), Vornong6 Penal
Oode of Texas, would be prohibited      in a vwft? area as
well as in a “dry” area, inasmuoh as the violat5ona      In
the &ted cases ocourred In a “dry” area.        This is speo-
 iffoally   passed on by th@ Court of Criminal Appeals in
~fjhelton v. State, 138 S. W. (Sd) 1078, in the following
 l*nguage :
           “This ir a casr ot rlrat Impression        when
      we are askad to dotealma       whether or not .the
      I~W rorbiaaing a ~)‘OP O   lI  P
                                  1605f    lg p lie6to th 0
      ‘wet’ or to the ‘dry* twritory       iifhin th6   #tat@.




              We wish to point out that the method of opera-
tion involved hers is to be distin@sheQ        ‘from t_hs one,
;,“l;;$o;reT~;~~rmed,      ie beiy    wed at tha Hou6tOa Club
                       and other o ubs over the State, whera
 indivldual’looks&     ere provided for the moffbers of tha
crlub. In those situations,      there would not be a sale sf
 liquor as there the individual     would be providiq    his own
 liquor,    and it would not be purchased by the treasurer
out or funds belonging     to ths club thereby becoming the
property of the olub.




                        .
    .


”




        Hon. William   N. Wensley,    Page 9        (V-203)


                    This oplnlen ia not to be ,~oenatrued as ovcr-
        ruling ronohtr Op5.aibn Wo. o-7139, but snly that, suoh
        opinion is qualified    by our taking various aondltiems
        as established   rather than leavinq them for dstsnira-
        tion by a jury.


                    If an orricm     or a private club purohasee
             liquor from fumds i’u&ilshed by individual          meu-
             bers to the olub, such. liquor becomes the oom-
             mon property of the, club.       When B drink is ae-
             livered b t e stew rd ~to a member a.nd i
             for ii +i&$&$kidsQ               by the dl;M
             stitutes    a                          the ftiaitinuai
             member. &i&k          v: St:t: ,‘41 i. 1. 612* Feiga
             0. State, 95 3, W. SOS; Ada@@ v. State, i4S S.W.
             940.)    Such a sale is in direct vlalation         at the
             provisions    of Artfole   666-3, Paragraph (a), Ver-
             non’s Penal code, of Texas.       This statutory     pxb-
             hibition    applies equally to “wet” areas end “dr *
             areas.     (Shelton v. State, 136 s. w. (26) 1078.3
                                               3;
                                     :’
                                     $*,        Yours very truly
                                           ‘ATTORNEYGENERALOF TEXAS



                                           By--&&sjtgtf
                                                        Assistant