The Ramrod nightclub in the Fenway has been seeking to increase its capacity from 600 patrons to more than 800. Neighborhood activists concerned about the expansion thought they had arrived at a compromise, an increase to 700 along with an agreement not to expand further.

Now the lawyer for the Ramrod has begun to backpedal. Armed with the Supreme Judicial Court's Toscano decision, she claims any agreement to limit future expansion is illegal.

The Mirabelle restaurant on Newbury Street received an all-alcohol license several years ago after an extensive neighborhood debate. The Neighborhood Association of the Back Bay ultimately signed off on the license after Mirabelle agreed to a series of convents, including a limitation on the license's transferability.

A few days after the Toscano decision, Mirabelle's attorney sent off a letter to NABB that questioned their earlier agreement with the neighborhood calling it "unenforceable."

The letter also said, "It is clear that a transfer of location or a change in ownership will not constitute a breach of any condition(s) of the license or any lawful agreement."

Prior to the Toscano decision, resident's groups and license applicants engaged in extensive negotiations prior to a hearing before the licensing board. Neighborhood approval was perceived as a critical part of getting approval from the board. Often these negotiations were embodied in a written contract between the residents' group and the applicant.

Now the world has changed. I do not believe the Ramrod and Mirabelle examples are isolated. Is this extreme position correct? Does the Toscano decision undermine completely any neighborhood agreement?

The answer is unclear. One narrow reading of the court's decision is that the only limit imposed on the agreements is that they cannot restrict the rights of restaurants and bars to apply for a license. Instead, some would argue that Toscano's agreement with the Beacon Hill Civic Association would have passed muster if it had simply included a proscription on serving any alcohol aside from beer and wine.

A more expansive reading of the Toscano is less sanguine. The decision can be interpreted as saying that the licensing board process is the only valid process for obtaining a license. Side agreements and the like violate this process and hence are not permitted. Indeed, under this reading, the only limitations that can be imposed on licenses are those imposed by the licensing board - and if the board doesn't have the authority to impose certain limits, then no one can impose them.

Lawyers can argue those interpretations, and heirpermutations, ad nauseum. What's right? We won't know until future court decisions, or additional state legislation clarifies the law.

I think side agreements such as those at issue in Toscano were a good thing. They allowed for compromise. If such agreements are not used, the battles before the licensing board (and potentially other authorities such as the Zoning Board of Appeals) will become more heated and extreme. That would be a shame.