ORDERS:
FINAL ORDER AND DECISION
STATEMENT
OF THE CASE
This matter comes before the Administrative Law Court (ALC or
Court) pursuant to S.C. Code Ann. §§ 61-2-20 and 61-2-260 (Supp. 2007). The
South Carolina Department of Revenue (Department) seeks a $500 fine from
Respondent for his first alleged violation of 23 S.C. Code Ann. Regs. 7-200.4 (Supp.
2007) within a three-year period. After notice of the date, time, place, and
nature of the hearing was timely given to all parties, a hearing was held before
me on January 23, 2008 at the offices of the Administrative Law Court.
FINDINGS
OF FACT
Having observed
the witnesses and exhibits presented at the hearing and closely passed upon
their credibility, taking into consideration the burden of persuasion by the
parties, I make the following Findings of Fact by a preponderance of the
evidence:
1. The
Respondent, Walter L. Duncan, holds an on-premises beer and wine permit for Stricks
Barn, a bar that is located at 3769 East Bypass Highway 9, Loris, South
Carolina.
2. On August 3,
2007, a youthful-looking underage cooperating individual (UCI) entered Stricks
Barn, carrying only a five-dollar bill and her identification, which correctly
showed that she was eighteen (18) years of age. SLED agent, Steve Wright,
followed the UCI into the bar, pretending to be intoxicated. The UCI sat down
at the bar and ordered a Bud Light. The bartender, Patricia Lewis, asked to
see the UCI’s identification, but she did not ask the UCI her age. After looking
at the UCI’s identification, Ms. Lewis opened a can of Bud Light and placed it
within 18 to 24 inches of the UCI. The UCI placed her five-dollar bill on the bar
and moved the beer towards herself, causing the beer to be within approximately
three inches of the UCI. During this same time period, Mr. Wright, who was
sitting nearby, ordered only a Sprite. After some of the other patrons at the
bar made comments about the UCI’s youthful appearance and Mr. Wright’s suspicious
behavior, Ms. Lewis asked to see the UCI’s identification again. However, she at
no point moved the beer away from the UCI. Mr. Wright then approached Ms.
Lewis regarding the UCI’s possession of the beer and observed that the UCI’s
five-dollar bill was lying on a cooler behind the bar.
3. At the time
of the incident, Ms. Lewis was filling in for Mr. Duncan, a function that she
still periodically performs. Ms. Lewis has never received any training on how
to check IDs. Moreover, since the incident, no new policies or procedures have
been enacted at Stricks Barn to prevent the sale of alcohol to underage
individuals.
4. Respondent
was issued an administrative citation for permitting the possession of a beer
by a person under the age of twenty-one (21) in violation 23 S.C. Code Ann.
Regs. 7-200.4 (Supp. 2007). Within the three years prior to August 3, 2007, Respondent
had not, at any point, been found guilty of violating Regulation 7-200.4. On
October 8, 2007, the Department issued its Final Agency Determination, from
which Respondent timely filed a request for a contested case hearing with the ALC
on October 22, 2007.
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 (Supp. 2007) grants jurisdiction to the Court to hear
contested cases under the Administrative Procedures Act. Specifically, S.C.
Code Ann. § 61-2-260 (Supp. 2007) grants the ALC the authority to hear
contested case hearings 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 Comm’n, 203 S.C. 49, 26 S.E.2d 22 (1943).
3. Permitting
or knowingly allowing a person under the age of twenty-one (21) to purchase or
possess beer upon the licensed premises is a violation against a beer and wine
permit. 23 S.C. Code Ann. Regs. 7-200.4 (Supp. 2007). Such a violation
constitutes sufficient grounds for either suspension or revocation of the
permit. Id. The term “knowingly” in Regulation 7-200.4 includes not
only actual knowledge, but also knowledge that could be gained by reasonable inquiry
when the circumstances are such as would cause a prudent man to inquire. See Feldman, 203 S.C. 49, 26 S.E.2d 22. A person may be found to act “knowingly”
where it appears that the person “[shut] his eyes to avoid knowing what would
otherwise be obvious.” State v. Thompkins, 263 S.C. 472, 484, 211
S.E.2d 549, 554 (1975).
4. Furthermore,
the permittee is responsible for the acts of his servants, agents, or employees
and cannot seek to avoid the consequences of a violation for lack of personal
knowledge. See, e.g., Crystal Ice Co. of Columbia, Inc. v.
First Colonial Corp., 273 S.C. 306, 309, 257 S.E.2d 496, 497 (1979) (“It is
well established that a principal is affected with constructive knowledge of
all material facts of which his agent receives notice while acting within the
scope of his authority.”); S.C. Law Enforcement Div. v. The “Michael and
Lance,” 284 S.C. 368, 327 S.E.2d 327 (1985) (determining that civil
forfeiture of a corporation’s boat based upon an employee’s illegal transporting
of drugs was warranted even though the corporation claimed that the use of the
boat to transport drugs was without its knowledge); 48 C.J.S. Intoxicating
Liquors § 259 (1981) (a permit holder is responsible for the actions and
conduct of employees utilizing the permit upon the permitted premises).
5. In
this case, Respondent claims that the beer that Ms. Lewis placed near the UCI
was meant for another patron, “Eric,” and that Regulation 7-200.4 was therefore
not violated. However, even if the beer was intended for “Eric,” the fact remains that, after the UCI clearly took possession of the beer, Ms.
Lewis, who had constructive knowledge of the UCI’s age, made no attempt to move
the beer away from the UCI.
Therefore, I find that Respondent – via Ms. Lewis – violated Regulation 7-200.4
by knowingly permitting the possession of beer by a person under the age of
twenty-one (21).
6. The
Department generally seeks a $500 fine for a first violation, within a
three-year period, of Regulation 7-200.4. See Revenue Procedure 04-4. Although
this Court has the authority to impose a lesser sanction than that sought by
the Department, in this case, the evidence demonstrates that Respondent did not, prior to the
incident in question, provide any formal or approved training to Ms. Lewis
regarding how to check IDs and that Stricks Barn has not changed any of its policies
or procedures since the incident. Therefore, I find that the $500 fine sought
by the Department in this case is an appropriate penalty.
ORDER
Based
upon the foregoing Findings of Fact and Conclusions of Law,
IT
IS HEREBY ORDERED that Respondent shall pay a fine of $500 to the
Department no later than thirty (30) days after the date of this Final Order
and Decision.
AND
IT IS SO ORDERED.
________________________________
Ralph
King Anderson, III
Administrative
Law Judge
February 4, 2008
Columbia, South Carolina
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