ORDERS:
FINAL ORDER AND DECISION
I. Introduction
Greenville Fine Wine, Inc. d/b/a Total Wine, 1125 Woodruff Road, Store 300B, Greenville, SC
(Total Wine) seeks a retail liquor license. The South Carolina Department of Revenue (DOR) would
have granted the license but for the protests filed by Thomas M. Smith and Sunil C. Fadia. Pursuant
to S.C. Code Ann. § 61-6-185 (Supp. 2003) the filing of a protest requires a hearing with jurisdiction
in the Administrative Law Court (ALC) under S.C. Code Ann. § 61-2-260 (Supp. 2003). The matter
was heard in Greenville, South Carolina with Total Wine present and both protestants in attendance.
DOR was not represented at the hearing since it had been previously excused on the ground that it
had no additional evidence to offer other than the DOR case file. The DOR case file was received
in evidence without objection.
II. Issue
In this matter, not all of the requirements for obtaining a retail liquor license are disputed. Rather,
the only dispute is whether a sufficient number of licenses have already been issued in the
community so as to warrant denying a retail liquor license to Total Wine.
III. Analysis
A. Findings of Fact
I find by a preponderance of the evidence the following facts:
Total Wine seeks to operate a retail liquor store at 1125 Woodruff Road, Suite 300B, Greenville
South Carolina. However, retail liquor stores are already in the area. In fact, 9 stores are within an
area covered by a radius of approximately 5 miles. As to these retail liquor stores, no evidence
shows the existence of current adverse economic conditions.
The license sought will be utilized in a building yet to be constructed. However, when completed,
the structure will be 25,000 square feet within a retail shopping plaza known as The Shops at
Greenridge. The store will provide over 8,000 wines in addition to its retail liquor products. Within
the plaza itself will be a wide range of retail outlets including Best Buy, Barnes and Noble, Lowes,
and Dick’s Sporting Goods.
The overall area of the location does not present a clearly marked boundary that easily identifies or
differentiates the region as a community. Rather, the area is a crossroads of commercial activity and
transportation. For example, access to the shopping plaza is through Woodruff Road with feeder
routes of I-385 and I-85. The per day vehicle count on Woodruff Road is approximately 31,000 with
I-385 being 75,000 and I-85 being 85,000.
While the areas beyond the interstates are populated with numerous residential subdivisions, the
immediate area around the proposed plaza is extensively commercial. For example, among others,
the retail establishments of Kohl’s, Sam’s Club, and Staples are within the area. In addition,
Greenville Mall and Haywood Mall are nearby with the Greenville Downtown Airport also being
within the area. Overall, dynamic growth is occurring in both the residential and commercial sectors
in and around the proposed location of Total Wine.
Total Wine seeks predominantly a wine clientele and intends to market to customers that are
somewhat wine knowledgeable and who are typically more affluent and more educated. It will draw
its clientele from an area beyond the immediate confines of the plaza and surrounding locations. Its
marketing methods reach a regional audience encompassing both Greenville and Spartanburg.
B. Conclusions of Law
The issue here is whether Total Wine's request for a retail liquor license must be denied since a
“sufficient number of licenses have already been issued in the . . . community.” S.C. Code Ann. §
61-6-910 (Supp. 2003). Unlike some states, South Carolina has not established a bright line test
limiting the number of licenses in an area.
Rather than specifics, S.C. Code Ann. § 61-6-910 (Supp.
2003) imposes a general requirement denying a retail liquor license when a “sufficient number of
licenses” have already been issued for a community.
In applying such a general test, an identification of the community involved must be established and
an identification of the relevant criteria for measuring when a sufficient number of retail liquor
licenses has been granted must also be made. Because no published appellate decisions interpret §
61-6-910, the ALJ “must decide the case on the evidence presented, its interpretation of the law, and
the application of the facts pertinent thereto.” Warren v. Board of Education, 41 Ohio Misc. 87, 322
N.E.2d 697 (Ohio Com.Pl. 1974) (dicta).
1. Community
In the instant case, the evidence does not clearly delineate the “community” involved. Rather, the
area in which Total Wine will operate is without distinctive boundaries. For example, the evidence
does not show a clearly marked boundary that easily identifies or differentiates the area. Rather, the
site here under review is located near an interchange of two interstate highways and, on the whole,
presents a location that is a crossroads of commercial and transportation activity. Indeed, Greenville
Mall and Haywood Mall are nearby. Likewise, the Greenville Downtown Airport is in the area.
Thus, rather than a specific community, the proposed license is in an area that is quite cosmopolitan
and defies labeling as a precise community.
2. Criteria
However, even if a “community” could be identified, the evidence shows that granting Total Wine’s
request will not create an excessive number of retail liquor licenses.
a. Related Statues
In determining the measure for “sufficient,” no single factor can be controlling since the General
Assembly has not chosen a single-factor test for liquor licenses. Indeed, even in those instances
where the General Assembly has provided a specific statutory listing of criteria for a liquor license,
such criteria have not been considered exhaustive or even exclusive. On the contrary, even when a
factor is omitted in one statute but included in another, the omitted factor can still be considered in
granting or denying a license since a plain recognition exists that “there may be a number of
variables inherent in any decision regarding the issuance of an alcoholic beverage license.” Schudel
v. South Carolina Alcoholic Beverage Control Commission, 276 S.C. 138, 276 S.E.2d 308, 310
(1981).
Therefore, a reasonable starting point for identifying appropriate criteria is a review of similar
statutes governing retail liquor licenses. Such a starting point is reasonable since, when interpreting
a statute, sections of law which are part of the same general statutory law must be construed together.
State v. Alls, 330 S.C. 528, 500 S.E.2d 781 (1998). Indeed, to find the meaning of a statute, courts
should be mindful not to isolate the single statute under review but rather to construe the statute with
regard for the whole system of law of which the statutes form a part. South Carolina Dept. of
Transp. v. Faulkenberry, 337 S.C. 140, 522 S.E.2d 822 (Ct. App. 1999). One such related statute
is S.C. Code Ann. § 61-6-170.
That section limits retail liquor licenses in a political subdivision if “the citizens who desire to
purchase alcoholic liquors therein are more than adequately served because of (1) the number of
existing retail stores, (2) the location of the stores within the subdivision, or (3) other reasons.” Thus,
the sheer number of stores and the locations of those stores are relevant factors.
Other factors to consider can be inferred from the use of the word “sufficient” in § 61-6-910.
“Sufficient” means “enough to meet the needs of a situation.” Merriam-Webster Collegiate
Dictionary, www.m-w.com/cgi-bin/dictionary, September 23, 2004. Thus, consideration can be
given to whether the existing retail liquor stores are adequate for the needs of the community. For
example, in deciding whether the needs of a community have been met, other jurisdictions have
considered “whether the clientele to be served [by the new license] is different from that served by
the existing business.” Pennsylvania Liquor Control Board v. Spring Gulch, Inc., 87 Pa.Cmwlth.
395, 487 A.2d 472 (1985). Thus, a relevant factor is deciding whether the new license serves a
clientele different from the existing licenses.
b. Applicable Criteria Applied
In reference to the number of existing retail stores and their locations, the protestants argue that
adding new licenses when existing stores are already present will have an economic impact on the
existing liquor stores in the area. While not controlling, I agree that economic impact is a relevant
consideration in deciding a challenge based on an assertion that an excess number of retail liquor
licenses exist. See Park Distributing Co. v. Delaware Liquor Com'n, 44 Del. 6, 54 A.2d
551(Del.Gen.Sess. 1947) (addressed concern that granting an additional liquor license would
interject a license into an area where existing operators were in a state “of impending operation at
a loss.”); Tobkes v. O'Connell, 272 A.D. 240, 70 N.Y.S.2d 494, 496 (1st Dep't 1947) (economics
is a valid licensing factor since some licensing bodies have “found from past experience that
licensees who attempt to operate with inadequate resources oftentimes succumb to the temptation
of committing violations of the Alcoholic Beverage Control Law.”). Thus, the economic impact to
the existing license holders in the area is a relevant consideration.
However, the decision of how much weight to give to the economic impact on existing retail stores
must be made in light of the General Assembly's intent to provide for the protection and welfare of
the people.
Laws regulating liquor sales stem from an “exercise of the police power of the state
to do what otherwise would be unlawful to do[.]” Feldman v. South Carolina Tax Commission,
203 S.C. 49, 26 S.E.2d 22 (1943). A law grounded in police powers is a law based on what the
General Assembly "judges fit for the protection and welfare of its people . . . ." Merchants' &
Planters' Bank v. Brigman, 106 S.C. 362, 91 S.E. 332 (1917). Thus, from an economic impact
perspective, the most persuasive evidence is that which relates to how a debilitating loss of profits
may contribute to violations of laws designed to protect the public welfare.
In reaching a conclusion in this case, it is important to note that the ALJ is a fact-finder. As the
finder of fact, the ALJ must decide the case based on the evidence presented in the hearing and may
not conduct its own independent investigation of the facts. E.g., People v. Hobley, 182 Ill.2d 404,
696 N.E.2d 313 (1998); see also Coleman v. C.I.R., T.C. Memo. 1963-19, 1963 WL 410 (Tax Ct.
Jan 24, 1963) ("[W]hile we may sympathize with the petitioner we must decide the case on the
evidence presented, which is wholly inadequate to support petitioner's claim here."). Based on the
evidence presented here, the instant case looks to identifying the number of existing retail stores in
the community, determining the location of the existing stores, assessing the economic impact the
new license will have on existing stores, and deciding whether the clientele to be served by the new
license is different from that already served by the existing license holders.
As to numbers, the evidence shows 9 retail liquor stores within an area covered by a radius of
approximately 5 miles. While not a small number, a quantity of 9 in a five mile radius is not an
excessive number for an area having the dynamic growth that is involved in this case. For example,
the license will be utilized in a retail shopping plaza having an appeal to a regional area and will be
within a building located on the grounds of a shopping plaza known as The Shops at Greenridge.
The plaza will have a wide range of retail outlets including Best Buy, Barnes and Noble, Lowes, and
Dick’s Sporting Goods. In addition, the area just beyond the plaza is an area with a high
concentration of retail outlets such as Kohl’s, Sam’s Club, and Staples.
Considering location, here, the evidence shows that Total Wine draws its clientele from an area far
in excess of the immediate confines of the plaza or surrounding locations. Rather, the marketing
methods to be employed will be consistent with those employed in the company’s other stores in
South Carolina. Such methods of permissible advertisements will address a regional area that will
encompass virtually all of Greenville and Spartanburg. The ability to draw from such a large area
is possible due to the store having approximately 25,000 square feet of space and providing over
8,000 wines. In addition, the store is readily accessible via I-385, I-85, and Woodruff Road with
such routes having a per day vehicle count respectively of 75,000, 85,000, and 31,000.
And, certainly economic impact is relevant. However, the object of the law addressing an excessive
number of retail liquor outlets in an area is not to protect profits of existing license holders. Rather,
the object is to place significant scrutiny on applications that will add licenses in areas that have
already begun approaching loss consequences. Such scrutiny is warranted since granting additional
licenses may unwisely create a temptation for existing license holders to violate the law and thus
place a danger to the public welfare. In the instant case, the evidence does not establish an economic
impact to existing stores of such a degree that a danger to the public welfare is presented.
Here, the evidence does not establish that adverse economic conditions already exist in the retail
liquor stores in the area. Further, the evidence shows that historically the opening of a Total Wine
store does not cause existing retailers to leave the business. For example, store openings in
Columbia and Charleston by Total Wine have not resulted in competitors closing their businesses
in those cities.
Finally, a relevant factor is whether the clientele to be served by the new license will be different
from that already being served by the existing license holders. Here, the evidence shows that Total
Wine (as the name implies) seeks predominantly a wine clientele. Moreover, Total Wine intends
to market to customers that are somewhat wine knowledgeable and who are typically more affluent
and more educated. Thus, the new license seeks to serve a different clientele.
3. Conclusion
While many factors may be considered, the most significant factors for the instant case are
identifying the number of existing retail stores in the community, determining the location of the
existing stores, assessing the economic impact the new license will have on existing stores, and
deciding whether the clientele to be served by the new license is different from that already served
by the existing license holders. When considered as a whole, the evidence presented in this case
weighs in favor of granting Total Wine's application.
IV. Order
The South Carolina Department of Revenue is directed to issue a retail liquor license to Greenville
Fine Wine, Inc. d/b/a Total Wine, 1125 Woodruff Road, Store 300B, Greenville, South Carolina.
AND IT IS SO ORDERED
______________________
RAY N. STEVENS
Administrative Law Judge
Dated: September 27, 2004
Greenville, South Carolina |