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Click here for the full text of this decision FACTS:The Texas Alcoholic Beverage Commission appeals from a judgment reversing its order which cancelled a mixed beverage permit issued to Yolanda Quintana d/b/a The Tap Bar and Restaurant. Quintana held a mixed beverage permit and mixed beverage late hours permit for the premises known as The Tap Bar and Restaurant. In 2003, the commission issued Quintana a notice of hearing alleging two violations of the Texas Alcoholic Beverage Code: 1. permittee, her agent, servant or employee was intoxicated on the licensed premises on Dec. 7, 2002, (Count 1) and 2. permittee, her agent, servant or employee sold or delivered an alcoholic beverage to an intoxicated person on July 12, 2003, (Count 2). The evidence admitted at the administrative hearing showed that an employee of the licensed premises, Mariana Cordero, had been drinking at The Tap on Dec. 7, 2002. Shortly after Cordero left the bar in her vehicle, she struck and killed a pedestrian. The arresting officer’s conclusion that Cordero was intoxicated was confirmed by analysis of a blood sample showing that Cordero’s blood alcohol concentration was .24, three times the legal limit. HOLDING:The court reverses the judgment of the trial court and renders judgment affirming the commission’s order. While Quintana’s motion for rehearing specified the ruling she asserted was error, namely, the cancellation of her license and permit, she did not challenge any of the specific factual findings forming the basis of the commission’s decision to cancel her permit and license. The court concludes that Quintana’s motion for rehearing is insufficient to preserve a complaint that the two violations found by the commission (Count 1 and Count 2) are not supported by substantial evidence. Furthermore, if Quintana intended to appeal the commission’s legal conclusion that Texas Alcoholic Beverage Code �11.61(b)(13) does not require proof that the employee was on duty or acting within the course and scope of employment, she was required to state this legal basis for the appeal in her motion for rehearing. Because Quintana did not do so, the trial court erred by addressing the issue. The trial court found that substantial evidence supported one of the two violations, and additionally determined that cancellation of Quintana’s mixed beverage and late night permits based on a single violation was “too harsh.” Stated in terms of Texas Government Code �2001.174(2), the trial court impliedly found that Quintana’s substantial rights had been prejudiced because the commission’s decision to cancel the permits was arbitrary, capricious, characterized by abuse of discretion or was a clearly unwarranted exercise of discretion. Section 11.61(b) of the Texas Alcoholic Beverage Code vests the commission with the authority and discretion to suspend for not more than 60 days or cancel a permit if it is found, after notice and hearing, that the permittee has been finally convicted of a violation of the Alcoholic Beverage Code. An agency has broad discretion in determining which sanction best serves the statutory policies committed to the agency’s oversight. An agency’s decision in determining an appropriate penalty will not be reversed unless an abuse of discretion is shown. An order supported by substantial evidence can still be arbitrary and capricious if the agency failed to consider a factor the Legislature directed it to consider, considered an irrelevant factor or reached an unreasonable result. Quintana has not appealed the trial court’s determination that Count 2 is supported by substantial evidence. The evidence related to that count established that Quintana sold an alcoholic beverage to a patron who exhibited obvious signs of intoxication. In addition to that violation, the commission considered that between 1998 and 2001 it had assessed administrative penalties against Quintana for seven separate violations of the Alcoholic Beverage Code. The repeated violations evidence a disregard for the provisions of the Alcoholic Beverage Code and the sanctions imposed by the commission. The most recent sale to an intoxicated person violation occurred despite the imposition of a total of $12,450 in fines and 83 days of license suspension. Under these circumstances, the court is unable to conclude that the commission acted arbitrarily or capriciously, or abused its discretion by canceling Quintana’s mixed beverage and late night permits. The trial court erred by reversing and remanding the commission’s decision for assessment of a different penalty. OPINION:McClure, J.; Barajas, C.J., McClure, and Ables, JJ.

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