EDWARDS v. MORROW No. COA11-754.
725 S.E.2d 366 (2012)
Benjamin EDWARDS and Lynn Owens, Owners of "Live"; George Beaman, Owner of "Club 519", "5 Street Distillery" and "Mac Billiards", Petitioners, v. Pitt County Health Director, John H. MORROW, Respondent.
Court of Appeals of North Carolina.
March 20, 2012.
Owens, Nelson, Owens & Dupree, PLLC, Greenville, by Jonathan Vann Bridgers , for Petitioners.
Ferguson Stein Chambers Gresham & Sumter, PA, Chapel Hill, by Adam Stein , for Respondent.
Wyrick Robbins Yates & Ponton LLP, Raleigh, by K. Edward Greene and Tobias S. Hampson , for Amici American Heart Association, American Lung Association, American Cancer Society and American Cancer Society Action Network, Americans for Nonsmokers' Rights, Tobacco Control Legal Consortium, and Campaign for Tobacco-Free Kids.
Attorney General Roy Cooper , by Assistant Solicitor General John F. Maddrey , for Amicus State of North Carolina.
In early 2010, the director of the Pitt County Health Department, Respondent John H. Morrow, sent notices of violation to Petitioners George Beaman, Benjamin Edwards, and Lynn Owens ("Petitioners"), the owners of Club 519, 5
While generally prohibiting smoking "in all enclosed areas of restaurants and bars," section 130A-496 of the smoking ban provides that "[s]moking may be permitted in ... [a] private club." N.C. Gen.Stat. § 130A-496 (2011). Section 130A-492(11) defines a "private club" as follows:
N.C. Gen.Stat. § 130A-492(11) (2011). Petitioners contend, and we agree, that the above statutory definition, read as a whole and interpreted to avoid superfluity,
The question raised by Petitioners before the trial court, and the issue before this Court on appeal, is whether exempting country clubs from the smoking ban, but not the establishments, is unconstitutional.
Where statutory language is clear and unambiguous, our Courts do not "engage in judicial construction but must apply the statute to give effect to the plain and definite meaning of the language." Fowler v. Valencourt, 334 N.C. 345, 348, 435 S.E.2d 530, 532 (1993). "The plain meaning of words may be construed by reference to standard, nonlegal dictionaries." State v. Webb, 358 N.C. 92, 97, 591 S.E.2d 505, 511 (2004) (internal quotation marks omitted). In this case, however, dictionaries offer no clear, unambiguous definition of the term "country club." See Webster's Third New International Dictionary 521 (2002) (defining "country club" as "an upper-class suburban or outlying club or clubhouse for social life, golf, and other recreation"); The Random House Dictionary of the English Language 463 (2d ed. 1987) ("[A] club, usually in a suburban district, with a clubhouse and grounds, offering various social activities and generally having facilities for tennis, golf, swimming, etc."); The American Heritage Dictionary 463 (4th ed. 2000) ("A suburban club for social and sports activities, usually featuring a golf course"). Indeed, the dictionary entries seem to agree only that country clubs usually are suburban and feature social and recreational activities; any other characteristics are not universally applicable. We further note that (1) our General Statutes contain no definition of the term, and (2) the statutory codes of other jurisdictions, like the dictionary entries, are not in agreement as to what precisely constitutes a country club. See, e.g., Fla. Stat. § 501.013(5) (2011) (for exemption from certain consumer protection requirements, a country club (1) must "ha[ve] as its primary function the provision of a social life and recreational amenities to its members, and for which a program of physical exercise is merely incidental to membership"; and (2) is defined as "a facility that offers its members a variety of services that may include, but need not be limited to, social activities; dining, banquet, catering, and lounge facilities; swimming; yachting; golf; tennis; card games such as bridge and canasta; and special programs for members' children"); Md. Code Ann., Alcoholic Beverages § 6-301(6)(iii) (2011) (for purpose of issuance of alcohol licenses, a "golf and country club" must have "200 or more bona fide members paying dues of not less than $75 per annum per member" and must "maintain ... two or more tennis courts, a swimming pool at least 30 feet by 80 feet in size, and a regular or championship golf course of nine holes or more"). We conclude, therefore, that the undefined term "country club," as used in the statute, is ambiguous and unclear. As such, we must interpret that ambiguous statutory language "to give effect to the legislative intent" and avoid "[a] construction of [the] statute which operates to defeat or impair the object of the statute." N.C. Baptist Hosps., Inc. v. Mitchell, 323 N.C. 528, 532, 374 S.E.2d 844, 846 (1988) (citation omitted).
As specified in section 130A-491, titled "Legislative findings and intent":
N.C. Gen.Stat. § 130A-491(b) (2011). The fact that the legislature's stated intent is to protect individuals in public places from the dangers of secondhand smoke, along with the fact that the language allowing smoking in country clubs is situated in the subsection defining "private club," is a clear indication that an interpretation of "country club" that "give[s] effect to the legislative intent" of the statutes would be one that only exempts private country clubs from the smoking ban. Conversely, an interpretation that allows smoking in public country clubs would, without question, "defeat or impair the object of the statute." Thus, we conclude that the legislature's exemption of country clubs from the smoking ban applies only to private country clubs and does not exclude public country clubs. The question, then, becomes, "When is a country club a private country club?"
Initially, we note that the vast weight of authority uses nonprofit status as a factor weighing in favor of—or as a requisite for—a determination that a club is truly private. See, e.g., Welsh v. Boy Scouts of America, 993 F.2d 1267, 1277 (7th Cir.1993) (holding that a club's nonprofit status supports the conclusion that the club is private); Lansdowne Swim Club, 713 F.Supp. at 804 (holding that a club's nonprofit status "support[s] its claim that it is a private club"); N.C. Gen.Stat. § 130A-247(2) (private club must be nonprofit).
Beyond regularly serving as a requisite for private status in legal analysis, nonprofit status, in and of itself, presumptively ensures that a country club is truly, rather than nominally, a private club. From an economics standpoint, it is considered a given that the primary aim of a for-profit entity is profit maximization. See, e.g., James F. McDonough III, Comment, The Myth of the Patent Troll: An Alternative View of the Function of Patent Dealers in an Idea Economy, 56 Emory L.J. 189, 208 (2006) (noting that "the overriding motive of a for-profit firm is to maximize profits" (citing R.H. Coase, The Nature of the Firm, 4 Economica 386, 390-92 (1937))); Srikanth Srinivasan, Note, College Financial Aid and Antitrust: Applying the Sherman Act to Collaberative Nonprofit Activity, 46 Stan. L.Rev. 919, 932 (1994) ("Microeconomic theory assumes that commercial firms pursue one objective—profit-maximization." (citing Robert S. Pindyck & Daniel L. Rubinfeld, Microeconomics 4 (2d ed. 1992))). In pursuit of that goal, a for-profit country club's owners will make decisions for the club—such as the requirements for membership, the size of membership, whether to allow a new member, and whether to allow smoking—based primarily, if not singularly, on which option maximizes the country club's profit. Cf. Nina J. Crimm, An Explanation of the Federal Income Tax Exemption for Charitable Organizations: A Theory of Risk Compensation, 50 Fla. L.Rev. 419, 446-47
Further, as evidenced by the legislature's creation of a private club exception in the first place, it is clear that the legislature, while attempting to protect individuals in public places, also sought to limit the impact of the smoking ban on the rights of association of members of organizations that are truly private. Cf. Coastal Ready-Mix Concrete Co. v. Bd. of Comm'rs of Town of Nags Head, 299 N.C. 620, 629, 265 S.E.2d 379, 385 (1980) (holding that legislative intent may be shown by "the language of the statute or ordinance" and "what the act seeks to accomplish"). In our view, interpreting the country club exemption to apply only to nonprofit private country clubs effectuates this intent by allowing smoking in clubs that are established and operated in the furtherance of a private, social or recreational purpose, while protecting from the risks of secondhand smoke citizens patronizing those organizations that are nominally private, but allow nearly unrestricted public access.
It is also notable that the legislative history of the statute reveals that the legislature's initial definition of "private club" in the proposed bill was nearly identical to the definition of private club in section 18B-1000(5), the main difference being an additional nonprofit requirement not found in section 18B-1000(5). See Act of May 19, 2009, ch. 27, 2009 N.C. Sess. Laws 39 (private club exception first introduced in the fourth edition of House Bill 2); see also N.C. Gen.Stat. § 18B-1000(5). We find it significant that, presented with two differing statutory definitions of "private club"—one definition with a nonprofit requirement, one without, compare N.C. Gen.Stat. § 18B-1000(5), with N.C. Gen.Stat. § 130A247(2)—and cognizant of those differing definitions, Williams v. Alexander Cnty. Bd. of Educ., 128 N.C. App. 599, 603, 495 S.E.2d 406, 408 (1998) ("In ascertaining the intent of the legislature, the presumption is that it acted with full knowledge of prior and existing laws."), the legislature chose to model the statutory definition in the smoking ban after the private club definition that did not contain a nonprofit requirement, yet added to that definition a requirement that the club must be nonprofit. Clearly, then, the drafters of the smoking ban's private club exception intended that all clubs qualifying under that exception would be nonprofit clubs. Accordingly, we conclude that an interpretation that accomplishes just that result best effectuates the legislature's intent, as shown by the wording and legislative history of the statute.
Because we conclude that only private, nonprofit country clubs are exempt under the private club exemption, to address Petitioners' constitutional claim we need not determine the constitutionality of exempting for-profit country clubs and not for-profit
Assuming that the establishments, which are private and for-profit, are similarly situated with private, nonprofit country clubs with respect to the smoking ban's statutory scheme, the question is whether the legislature could have had a plausible, rational reason for allowing smoking in private, nonprofit country clubs, but disallowing smoking in private, for-profit non-country clubs. Rhyne v. K-Mart Corp., 358 N.C. 160, 180-81, 594 S.E.2d 1, 15 (2004) (holding that rational basis review is satisfied "so long as there is a plausible policy reason for the classification ... and the relationship of the classification to its goal is not so attenuated as to render the distinction arbitrary or irrational") (quoting Nordlinger v. Hahn, 505 U.S. 1, 11, 112 S.Ct. 2326, 2332, 120 L.Ed.2d 1, 13 (1992)). And the answer, as it was in Liebes, is "yes." ___ N.C.App. at ____, 713 S.E.2d at 553-55. In Liebes, this Court noted several plausible reasons why our legislature would exempt nonprofit non-country club organizations, but not for-profit non-country club organizations, such as the potential impairment of the legislative intent accompanying a broader definition of "private club" and more objective enforcement resulting from the ready discernibility of nonprofit status. Id. Those same reasons justify the legislature's exemption of only nonprofit country clubs and not for-profit non-country club organizations such as the establishments. Accordingly, we conclude that the smoking ban's private club exception does not irrationally classify the establishments, and that the Board of Health's enforcement of the North Carolina smoking ban against Petitioners does not violate Petitioners' constitutional right to equal protection. Therefore, we hold that the trial court erred in declaring the challenged section of the North Carolina smoking ban unconstitutional. The decision of the trial court is
Judge STROUD concurs.
Judge BEASLEY concurs in separate opinion.
BEASLEY, Judge, concurring in separate opinion.
I agree with the majority's reliance on Liebes v. Guilford Cnty. Dep't of Pub. Health, ___ N.C.App. ____, 713 S.E.2d 546 (2011) to resolve this issue, but I believe that the majority's interpretation of the country club exemption unduly narrows the force and effect of the statute.
"Where a statute contains two clauses which prescribe its applicability, and the clauses are connected by a disjunctive (e.g. "or"), the application of the statute is not limited to cases falling within both clauses, but will apply to cases falling within either of them." Spruill v. Lake Phelps Vol. Fire Dep't, Inc., 351 N.C. 318, 323, 523 S.E.2d 672, 676 (2000) (internal quotation marks and citations omitted). Moreover, "we follow the maxims of statutory construction that words of a statute are not to be deemed useless or redundant[.]" Town of Pine Knoll Shores v. Evans, 331 N.C. 361, 366, 416 S.E.2d 4, 7 (1992).
N.C. Gen.Stat. § 130A-492(11) (2011) states,
The majority opines that the "country club" exemption only applies to "nonprofit country clubs and does not ... exempt for-profit country clubs." Under the majority's interpretation, the "country club" and "an organization" are nearly identical. I do not believe that the legislature intended to limit the "country club" exception to non-profit country clubs, especially where juxtaposed to the
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