SC Administrative Law Court Decisions

3. On April 20, 2005, an underage cooperating individual (UCI) entered Southern Convenience 339. While inside the store, the UCI handed money and a beer directly to the clerk, Kindra Bouknight. The clerk asked the UCI for his identification, and the UCI handed her his driver’s license which stated his correct date of birth as 07-21-1986. After looking at the UCI’s license, the cashier sold him the beer. The Parties stipulated that the Respondent violated the provisions of 23 S.C. Code Ann. Regs. 7-200.4(Supp. 2004) by permitting the purchase of beer by an individual under the age of twenty-one (21), and that it was the third violation. The only point in contention is the penalty.

4. The Respondent was issued an administrative citation for permitting the purchase of beer by a person under twenty-one (21) in violation 23 S.C. Code Ann. Regs. 7-200 (Supp. 2004). The Respondent’s two previous violations of the laws regulating its beer and wine permit were for permitting an underage person to purchase beer. The Respondent paid a $400.00 fine for the first violation on December 4, 2003 and a $1,000.00 fine for the second violation on December 1, 2004. On September 14, 2005, the Department imposed a forty-five (45) day suspension for the violation in this case, and the Respondent requested an Administrative Hearing on the suspension.

5. Several corporate managers testified on behalf of the Respondent, including the President/CEO of Southern Convenience Stores, the Regional Manager for the Winnsboro area and the store manager of this particular location. All testified that the company policy was: to stress the importance of not selling alcohol to minors, that if anyone appeared to be under thirty years of age to check the identification to confirm age and that store clerks could lose their jobs for selling alcohol to minors. In addition, the company verifies that all of its store managers are TIPs (Training for Intervention Procedure) trained and all regional managers are certified TIPS trainers. Furthermore, the company has instituted a “secret shopper” program in the last year. I found the President/CEO and the Regional Manager to be very credible witnesses.

6. This particular location was one of the company’s under-performing stores and

did not, therefore, have a cash register with the software that made it difficult to override a date verification program. In addition, the clerk that made the sale was not yet TIPs trained and had only been with the company for six weeks. Her training took place over the course of three days, with approximately thirty to forty minutes devoted to the sale of alcohol.

CONCLUSIONS OF LAW

Based upon the above Findings of Fact, I conclude the following as a matter of law:

1. S.C. Code Ann. § 1-23-600 (1986 & Supp. 2004) grants jurisdiction to the Court to hear contested cases under the Administrative Procedures Act. Specifically, S.C. Code Ann. § 61-2-260 (Supp. 2004) grants the Court the authority to hear contested cases in matters governing alcoholic beverages, beer and wine.

2. Permits and licenses issued by this state for the sale of liquor, beer and wine are privileges to be used and enjoyed only so long as the holder complies with the restrictions and conditions governing them. See Feldman v. S.C. Tax Commission, 203 S.C. 49, 26 S.E. 2d 22 (1943).

3. S.C. Code Ann. § 61-4-580 (Supp. 2004) sets forth that “[n]o holder of a permit authorizing the sale of beer or wine or a servant, agent, or employee of the permittee may knowingly commit any of the following acts upon the licensed premises covered by the holder's permit: (1) sell beer or wine to a person under twenty‑one years of age . . . .” Regulation 7-200.4 further provides that:

To permit or knowingly allow a person under twenty‑one years of age to purchase or possess or consume alcoholic liquors, beer or wine in or upon a licensed place of business which holds a license or permit issued by the Department is prohibited and constitutes a violation against the license or permit. (Emphasis added).

Accordingly, Regulation 7-200.4adds the term “to permit” a sale as part of the violation. However, “[a]lthough a regulation has the force of law, it may not alter or add to a statute.” Goodman v. City of Columbia, 318 S.C. 488, 490, 458 S.E.2d 531, 532 (1995). Moreover, “[e]ach part of a statute should be given effect and each word given its plain meaning if this can be accomplished by any reasonable construction.” Sea Island Scenic Parkway Coalition v. Beaufort County Bd. of Adjustments and Appeals, 316 S.C. 231, 236, 449 S.E.2d 254, 257 (Ct. App. 1994). Furthermore, the license holder is responsible for the actions and conduct of employees utilizing the permit upon the permitted premises. 48 C.J.S. Intoxicating Liquors § 259 (1981). Therefore, I conclude that the language in Regulation 7-200.4insures that the permittee cannot seek to avoid the consequences of a violation for lack of personal knowledge because the permittee is responsible for the acts of his servants, agents, or employees.

4. In this case, the Department imposed a forty-five (45) day suspension of the Respondent’s beer and wine permit for a third violation of 23 S.C. Code Ann. Regs. 7-200.4(Supp. 2004) within the past three years. See Revenue Procedure 95-7. The Administrative Law Court, as the trier of fact in contested cases under the Administrative Procedures Act, has the authority to establish the facts supporting the imposition of a penalty for a violation. Inherent in and fundamental to the quasi-judicial powers of an Administrative Law Judge is the authority to decide the appropriate sanction when such is disputed. Walker v. South Carolina ABC Comm’n, 305 S.C. 209, 407 S.E. 2d 633 (1991). To that end, the Administrative Law Judge must consider relevant evidence presented in mitigation. Mitigation is defined as a lessening to any extent, great or small. It may be anything between the limits of complete remission on the one hand and a denial of any relief on the other. In a legal sense, it necessarily implies the exercise of the judgment of the court as to what is proper under the facts of the particular case. 58 C.J.S. Mitigation p. 834-835 (1948). A legitimate as well as a significant consideration is whether the alleged mitigating factor demonstrates reasonable cause to reduce the penalty. Kroger Co. v. Department of Revenue, 673 N.E. 2d 710 (Ill. 1996).

The Respondent’s CEO’s testimony was very credible. He stated that the company has begun using a “secret shopper” program where a minor attempts to purchase alcohol at a location, every few months. So far, all these attempts have been foiled by the clerks on duty. In addition, the company has installed several cash registers with specialized computer software which prints the birthday from the purchaser’s proffered identification on the receipt and which cannot be easily overridden^[1]. Based on these facts, and the steps the Respondent has taken to prevent another violation, the suspension of the Respondent’s permit for forty-five days seems excessive.

Here, the Respondent’s clerk knowingly sold beer to an individual under the age of twenty-one (21). As mitigation, the Respondent presented evidence that he has required his managers to undergo TIPs training and to have 90 % of the clerks TIPs trained. In addition, managers are to remind the clerks of the importance of checking the identification of patrons. However, though the Respondent has instituted the “secret shopper” program, that program was instituted after the initial violation against the Respondent. Nevertheless, the Respondent has made been diligent in his efforts to deter his employees from selling beer or wine to underage persons. The Respondent’s previous penalty was a forty five day suspension. Therefore, I find that in light of the facts of this case that there are sufficient mitigating circumstances to merit a shorter suspension of the Respondent’s permit.

ORDER

Based upon the foregoing Findings of Fact and Conclusions of Law, IT IS HEREBY ORDERED that the Respondent’s permit shall be suspended for fourteen days, beginning September 1, 2006.

AND IT IS SO ORDERED.

___________________________________

CAROLYN C. MATTHEWS

Administrative Law Judge

August 21, 1006

Columbia, South Carolina