ORDERS:
FINAL ORDER AND DECISION
STATEMENT OF THE CASE
This matter comes before this tribunal pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2002) and S.C. Code Ann. §§ 1-23-310 et seq. (1986 & Supp. 2002). The South Carolina Department of Revenue (Department) contends that Respondent
Rainbow Oil Company, Inc., d/b/a Rainbow Gas Garden 10 (Rainbow), knowingly allowed an underage individual to
purchase beer from Respondent's licensed premises located at 10354 Dunbarton Boulevard, Barnwell, South Carolina, in
violation of 23 S.C. Code Ann. Regs. 7-9(B) (Supp. 2002). For this third violation of Regulation 7-9(B) in as many years,
the Department seeks to impose a forty-five-day suspension of Respondent's off-premises beer and wine permit for the
location. In response, Rainbow concedes that the alleged violation did occur, but further contends that the proposed penalty
for the violation is excessive in light of its efforts to prevent such sales.
After timely notice to the parties, a hearing of this matter was held on March 6, 2003, at the Administrative Law Judge
Division in Columbia, South Carolina. Based upon the evidence presented and the arguments made at the hearing, I find
that Respondent did commit a third violation of Regulation 7-9(B) within three years and that the appropriate penalty for
that violation is a thirty-day suspension of Respondent's permit.
FINDINGS OF FACT
Having carefully considered all testimony, exhibits, and arguments presented at the hearing of this matter, and taking into
account the credibility and accuracy of the evidence, I make the following Findings of Fact by a preponderance of the
evidence:
1. Respondent Rainbow Oil Company, Inc., d/b/a Rainbow Gas Garden 10, holds a permit authorizing it to sell beer and
wine for off-premises consumption from its store located at 10354 Dunbarton Boulevard in Barnwell, South Carolina. This
permit is numbered 32015547-PBG and was held by Rainbow on July 24, 2002.
2. On July 24, 2002, South Carolina Law Enforcement Division (SLED) Agents Konni Smith and Marvin Brown, with the
assistance of an Underage Cooperating Individual (UCI), Crystal Marshall, conducted a routine sting operation at Rainbow
Gas Garden 10.
3. During this operation, the UCI entered the establishment and purchased a 22-ounce Bud Light beer from Rainbow's
employee, Pearlie Highsmith. During the purchase, Ms. Highsmith did not request the UCI's Driver's License or any other
form of identification for the purposes of verifying her age, nor did she inquire as to the age of the UCI. Further, the UCI
did not indicate verbally or through any physical gesture or assertion that she was twenty-one years of age or older. In fact,
during the sale, another employee at the store suggested to Ms. Highsmith that she ought to check the UCI's identification.
Ms. Highsmith explicitly rejected this advice and completed the sale without requesting identification from the UCI.
4. At the time of the sale, the UCI was seventeen years old and appeared sufficiently youthful so as to merit an inquiry into
her age before allowing her to purchase alcohol.
5. Rainbow has committed two prior violations of Regulation 7-9(B) at Rainbow Gas Garden 10 by knowingly allowing
underage individuals to purchase beer from the store. These prior violations occurred on December 21, 1999, and March 7,
2001. Respondent paid fines of $400 and $800, respectively, for these two violations.
CONCLUSIONS OF LAW
Based upon the foregoing Findings of Fact, I conclude the following as a matter of law:
1. The Department is charged with the responsibility of administering and enforcing the laws and regulations governing
alcoholic beverages, including beer and wine. S.C. Code Ann. § 61-2-20 (Supp. 2002).
2. Regulation 7-9(B) prohibits holders of beer and wine permits from selling beer or wine to persons under twenty-one
years of age. The regulation provides that:
To permit or knowingly allow a person under twenty-one years of age to purchase or possess or consume beer or wine in or
on a licensed establishment which holds a license or permit issued by the [Department] is prohibited and constitutes a
violation against the license or permit. Such violation shall be sufficient cause to suspend or revoke the license or permit
by the [Department].
23 S.C. Code Ann. Regs. 7-9(B) (Supp. 2002). At the hearing, Respondent Rainbow conceded that it committed a
violation of Regulation 7-9(B) as alleged by the Department, when its clerk, Pearlie Highsmith, knowingly permitted
SLED's UCI to purchase beer from Rainbow Gas Garden 10 on July 24, 2002.
3. The Department has jurisdiction to revoke or suspend permits authorizing the sale of beer and wine. S.C. Code Ann. §
61-4-590 (Supp. 2002). Pursuant to such authority, the Department may suspend or revoke a beer and wine permit if the
permittee has knowingly sold beer or wine to a person under twenty-one years of age. S.C. Code Ann. § 61-4-580 (Supp.
2002); 23 S.C. Code Ann. Regs. 7-9(B) (Supp. 2002); see also S.C. Code Ann. § 61-4-270 (Supp. 2002) (authorizing the
Department to "revoke the permit of a person failing to comply with any requirements" in Chapter 4 of Title 61). Further,
the Department may exercise this authority to suspend or revoke a permit for a first violation of the prohibition against
selling beer and wine to minors. See S.C. Code Ann. §§ 61-4-270, 61-4-580, 61-4-590; 23 S.C. Code Ann. Regs. 7-9(B).
In lieu of such suspension or revocation, the Department may also impose a monetary penalty upon a permittee for selling
beer and wine to minors. S.C. Code Ann. § 61-4-250 (Supp. 2002). For retail beer and wine permittees, this monetary
penalty must be no less than $25 and no greater than $1,000. Id.
4. S.C. Revenue Procedure 95-7 (1995) sets forth the Department's penalty guidelines for violations of the alcoholic
beverage control laws. For retail beer and wine permits, Revenue Procedure 95-7 provides for a $400 fine for the first
violation by a permittee, an $800 fine for the second violation, a forty-five-day suspension of the permit for the third
violation, and revocation of the permit for the fourth violation. However, this document does not set binding norms for the
Department, but rather only provides guidance to the Department in assessing penalties for violations of the alcoholic
beverage control laws. See Revenue Procedure 95-7, at ¶ 4 ("These are guidelines only and this advisory opinion does not
establish a binding norm."). As such, Revenue Procedure 95-7 is not law and thus is not binding upon this Division. Cf.
Home Health Serv., Inc. v. S.C. Tax Comm'n, 312 S.C. 324, 328, 440 S.E.2d 375, 378 (1994) (holding that "whether a
particular agency proceeding announces a rule or a general policy statement depends upon whether the agency action
establishes a binding norm") (citing Ryder Truck Lines, Inc. v. United States, 716 F.2d 1369 (11th Cir. 1983)).
5. The weight and credibility assigned to evidence presented at the hearing of a matter is within the province of the trier of
fact. See S.C. Cable Television Ass'n v. S. Bell Tel. & Tel. Co., 308 S.C. 216, 222, 417 S.E.2d 586, 589 (1992); see also
Doe v. Doe, 324 S.C. 492, 502, 478 S.E.2d 854, 859 (Ct. App. 1996) (holding that a trial judge, when acting as finder of
fact, "has the authority to determine the weight and credibility of the evidence before him"). Furthermore, a trial judge who
observes a witness is in the best position to judge the witness's demeanor and veracity and to evaluate the credibility of his
testimony. See, e.g., Woodall v. Woodall, 322 S.C. 7, 10, 471 S.E.2d 154, 157 (1996); Wallace v. Milliken & Co., 300
S.C. 553, 556, 389 S.E.2d 448, 450 (Ct. App. 1990).
6. The facts in this case warrant a lesser penalty than that sought to be imposed by the Department. It is a generally
recognized principle of administrative law that the fact finder has the authority to determine an appropriate administrative
penalty, within the statutory limits established by the legislature, after the parties have had an opportunity for a hearing on
the issues. See, e.g., Walker v. S.C. Alcoholic Beverage Control Comm'n, 305 S.C. 209, 407 S.E.2d 633 (1991). Further,
in assessing a penalty, the finder of fact "should give effect to the major purpose of a civil penalty-deterrence." Midlands
Utility, Inc. v. S.C. Dep't of Health & Envtl. Control, 313 S.C. 210, 212, 437 S.E.2d 120, 121 (Ct. App. 1993).
7. Nevertheless, Respondent should be reminded that the purpose of the statutory prohibition against selling alcohol to
underage individuals is to protect both the underage individuals and the public at large from the adverse consequences of
such sales. The sale of alcohol to an underage individual is a serious offense and cannot be taken lightly. Further, a permit
to sell beer and wine is neither a contract nor a property right. Rather, it is merely a permit to do what otherwise would be
unlawful to do, and to be enjoyed only so long as the restrictions and conditions governing its continuance are complied
with. Feldman v. S.C. Tax Comm'n, 203 S.C. 49, 26 S.E.2d 22 (1943). Accordingly, there are legal consequences for
noncompliance with the alcoholic beverage laws of this State. Consequently, Respondent should not expect such leniency
for a subsequent violation of those laws at this location.
ORDER
Based upon the Findings of Fact and Conclusions of Law set forth above,
IT IS HEREBY ORDERED that, for Respondent's third violation of 23 S.C. Code Ann. Regs. 7-9(B) within three years,
the Department shall SUSPEND Respondent's beer and wine permit for its premises located at 10354 Dunbarton
Boulevard, Barnwell, South Carolina, for a period of thirty (30) days.
IT IS FURTHER ORDERED that, prior to resuming the sale of alcoholic beverages at this location, Respondent must
request and submit the store manager or other person responsible for employee training at the location to the training
provided by SLED to retailers of alcoholic beverages on how to prevent sales to underage individuals.
AND IT IS SO ORDERED.
______________________________
JOHN D. GEATHERS
Administrative Law Judge
Post Office Box 11667
Columbia, South Carolina 29211-1667
March 11, 2003
Columbia, South Carolina |
