SC Administrative Law Court Decisions

STATEMENT OF THE CASE

This matter comes before the Administrative Law Court (“ALC” or “Court”) for a contested case hearing pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2007) and S.C. Code Ann. §§ 1-23-310 et seq. (2005 and Supp. 2007). Bernice C. Ryant (“Petitioner”) seeks a retail liquor license for the location at 5416 Norway Road, Norway, South Carolina.

Respondent, South Carolina Department of Revenue (“Department”), denied Petitioner’s application for the license for several reasons, including an extensive criminal record, failure to meet with SLED Agents to complete the application process, failure to provide a correct advertisement, and outstanding tax liabilities.

A hearing in this matter was held at 10:00 a.m. on Tuesday, March 4, 2008, at the ALC in Columbia, South Carolina. All parties were present at the hearing.

After listening to the testimony and weighing all evidence presented at the hearing, this Court finds that Petitioner’s retail liquor license shall be denied.

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 evidence:

1. The ALC has personal and subject matter jurisdiction.

2. Notice of the time, date, place, and subject matter of the hearing was timely given to all parties. This hearing was initially scheduled for February 6, 2008. The Petitioner requested a continuance due to a work-related conflict; the Respondent had no objection to a continuance. The hearing was rescheduled for March 4, 2008.

3. Petitioner has applied as a sole proprietor for a retail liquor license for the location at 5416 Norway Road, Norway, South Carolina.

4. The qualifications set forth in S.C. Code Ann. § 61-6-110 (Supp. 2007) concerning the age of the applicant are properly established. There are questions, however, concerning Ms. Ryant’s residency. Specifically, SLED Agent Ida Dixon, who was assigned to investigate this application, found that Ms. Ryant had both a North and South Carolina Driver’s License. Ms. Ryant explained that her North Carolina employer required her to have a North Carolina license, but that she considered South Carolina her residence. Ms. Ryant testified that she had an apartment in North Carolina, but returned to her home in Orangeburg on the weekends.

5. Public notice of the application was lawfully posted at the location as required by S.C. Code Ann. § 61-6-180(B) (Supp. 2007). The advertisement notice which must appear in a newspaper of general circulation pursuant to § 61-6-180(A), however, was not correct. The advertisement described the proposed business as an “on premises wine and liquor store.” I find such advertisement to be deficient.

6. Ms. Ryant testified that she is aware of the hours of operation for a retail liquor store and that she intends to retire from her job in North Carolina to operate her business in Norway.

7. Ms. Ryant’s SLED background check, which she submitted with her application, shows numerous convictions for fraudulent checks from 1982 through 2006. Specifically, the SLED records start on page 18 of the Respondent’s file and continue through page 47. Although Ms. Ryant testified that she had written some of the bad checks during a difficult period in her life, she also testified that some of the checks had been forged by her niece. Ms. Ryant took responsibility for the checks written by her niece. Based on this record, I find that Ms. Ryant does not meet the requirements of S.C. Code Ann. §§ 61-2-100(D) and 61-6-110 (Supp. 2007) regarding good moral character and good repute.

8. Ms. Ryant had provided a lease, dated February 2007 for 5416 Norway Road, Norway, South Carolina, as part of her application. At the hearing, however, the Department presented testimony that the landlord had leased the property to another individual who had also filed an application for a retail liquor license at this same location.

9. The Department had initially denied Ms. Ryant’s application due to outstanding tax liabilities for failure to file a “zero return” for this location’s retail sales license. Ms. Ryant has since made those filings, so that reason for denial is no longer at issue. Ms. Ryant testified that she has not, however, filed an individual income tax return in South Carolina other than in 2006.

CONCLUSIONS OF LAW

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

1. S.C. Code Ann. § 1-23-600 (2005) grants jurisdiction to the Administrative Law Court to hear contested cases under the Administrative Procedures Act. Additionally, S.C. Code Ann. § 61-2-260 (Supp. 2007) grants the Administrative Law Court the responsibilities to determine contested matters governing alcoholic beverages, beer, and wine.

2. “[T]he issuance or granting of a license to sell beer or alcoholic beverages rests in the sound discretion of the body or official to whom the duty of issuing it is committed[.]” Palmer v. S.C. Alcoholic Beverage Control Comm’n, 282 S.C. 246, 248, 317 S.E.2d 476, 477 (Ct. App. 1984); see also, Wall v. S.C. Alcoholic Beverage Control Comm’n, 269 S.C. 13, 235 S.E.2d 806 (1977).

3. 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). 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).

4. S.C. Code Ann. § 61-6-110 et seq. (Supp. 2007) establish the criteria for the issuance of a retail liquor license. Included in the criteria are residency requirements, the requirement that the applicant be a person of good repute, and the requirement that the proposed location be a proper and suitable one. S.C. Code Ann. §§ 61-6-110 and 61-4-520(6) (Supp. 2007).

5. The party seeking a license has the duty of proving she has met all of the statutory requirements for the license. 48 C.J.S. Intoxicating Liquors, § 114 (1981). One such requirement is the notice to the public by newspaper advertisement imposed by § 61-6-180(A). The notice must be in the legal notice section of the paper or in an equivalent section if the newspaper has no legal notice section, be in large type, cover a space one column wide and not less than two inches deep, and state the type of license applied for. Ms. Ryant failed to meet the statutory notice requirement since the advertisement showed an “on premises wine and liquor store.” Such notice statutes are designed to “notify the public of the proposed use of specified property by named parties so that any member of the public is afforded an opportunity to file a protest against the issuance of a license for that location or to the named parties or both.” Palmer-Ball v. Esquire Liquors, Inc., 490 S.W.2d 472 (Ky. 1973).

6. In addition, § 61-2-100 lays out the general requirements that all applicants for permits and licenses to sell alcoholic beverages must satisfy. Included in these requirements is the proviso that “[t]he department may not issue a license or permit under [Title 61] to any person unless the person and all principals are of good moral character.” Section 61-2-100(D).

7. In South Carolina, there is no single criterion by which to determine whether or not one is possessed of good moral character so as to satisfy the alcoholic beverage licensing laws. See 1969 Op. S.C. Att'y Gen. No. 2709. Generally, however, to have good moral character one must possess all of the elements essential to make up that character, including common honesty and veracity and simple adherence to the law. Id.; see also Zemour, Inc. v. State Div. of Beverage, 347 So. 2d 1102, 1105 (Fla. Dist. Ct. App. 1977) (defining “good moral character” for the purposes of a liquor licensing statute as “not only the ability to distinguish between right and wrong, but the character to observe the difference; the observance of the rules of right conduct, and conduct which indicates and establishes the qualities generally acceptable to the populace for positions of trust and confidence”); Lowe v. Herrick, 223 P.2d 745, 747 (Kan. 1950) (noting that, with regard to a retail liquor license application, “[w]hat constitutes good moral character is not easy to determine or define, but upon general principles one who does that which is forbidden and penalized by the law of the land does not possess the character and fitness required by the statute”).

8. Further, while good moral character cannot be simply and narrowly defined, certain specific traits have been identified as indicating a lack of good moral character. See 1989 Op. S.C. Att’y Gen. No. 89-89. In particular, courts have found that acts of moral turpitude are antithetical to what is considered good moral character, and have therefore concluded that the commission of such acts of moral turpitude implies the absence of good moral character. Id.

9. South Carolina courts have stated that “[a]n act in which fraud is an ingredient involves moral turpitude.” State v. Horton, 271 S.C. 413, 414, 248 S.E.2d 263, 263 (1978). In determining whether a crime is one involving moral turpitude, courts focus primarily on the duty to society and fellow man that is breached by the commission of the crime. Alex Sanders et al., Trial Handbook for South Carolina Lawyers § 13:13, at 484 (2000). Ms. Ryant’s numerous convictions for fraudulent check charges for over two decades would be crimes of moral turpitude.

10. Although “proper location” is not statutorily defined, broad discretion is vested in the trier of fact to determine the fitness or suitability of a particular location for the requested permit. See Fast Stops, Inc. v. Ingram, 276 S.C. 593, 281 S.E.2d 118 (1981).

11. As the trier of fact, the issuance or denial of a license rests within the sound discretion of this tribunal. Inherent in the power to issue a permit or license, is also the power to refuse it. Terry v. Pratt, 258 S.C. 177, 187 S.E.2d 191 (1972).

12. The determination of suitability of location is not necessarily a function solely of geography. Rather, it involves an infinite variety of considerations related to the nature and operation of the proposed business and its impact on the community within which it is to be located. Kearney v. Allen, 287 S.C. 324, 338 S.E.2d 335 (1985); Schudel v. S.C. Alcoholic Beverage Control Comm’n, 276 S.C. 138, 276 S.E.2d 308 (1981).

13. In determining whether a proposed location is suitable, it is proper for this tribunal to consider any evidence that shows adverse circumstances of location. Kearney v. Allen, 287 S.C. 324, 338 S.E.2d 335 (1985); Palmer v. S.C. Alcoholic Beverage Control Comm’n, 282 S.C. 246, 317 S.E.2d 476 (Ct. App. 1984) (citing Smith v. Pratt, 258 S.C. 504, 189 S.E.2d 301 (1972)).

14. The factual determination of whether or not an application is granted or denied is usually the sole prerogative of the executive agency charged with rendering that decision. Palmer v. S.C. Alcoholic Beverage Control Comm’n, 282 S.C. 246, 317 S.E.2d 476 (Ct. App. 1984). As the trier of fact, an administrative law judge is authorized to determine the fitness or suitability of the proposed business location of an applicant for permits and licenses to sell alcoholic beverages using broad but not unbridled discretion. Byers v. S.C. Alcoholic Beverage Control Comm’n, 281 S.C. 566, 316 S.E.2d 705 (Ct. App. 1984).

15. The evidence presented in this case, that the landlord has entered into a new lease for this property, is certainly an “adverse circumstance” as to the suitability of the location. Although this tribunal cannot statutorily determine landlord-tenant disputes, the fact that the Petitioner no longer has access to the location, can be considered as part of the licensing process.

16. I conclude Petitioner has not met her burden of proof in showing that she meets all of the statutory requirements for holding a retail liquor license. Specifically, the Petitioner was not forthcoming in her explanation for having a driver’s license issued by two different states, she did not adequately address her extensive record for writing fraudulent checks, she has failed to show that she has access to the proposed location and a current lease for that property, and she has failed to show that she is a resident of South Carolina who has paid her individual income tax due.

17. In reaching a decision in this matter, this tribunal is constrained by the record before it, and by the applicable statutory and case law. There may be cogent explanations for the Petitioner’s criminal record, lack of a valid lease, and residency questions, but the Petitioner failed to explain those deficiencies adequately.

ORDER

Based upon the above Findings of Fact and Conclusions of Law:

IT IS HEREBY ORDERED that the Petitioner’s request for a Retail Liquor License is Denied.

AND IT IS SO ORDERED.

JOHN D. MCLEOD

Administrative Law Judge

March 10, 2008

Columbia, SC