SC Administrative Law Court Decisions

This matter comes before the Administrative Law Court (“ALC” or “Court”) for a contested case hearing pursuant to S.C. Code Ann. §§ 1-23-310 et seq. (2005 & Supp. 2007), 61-2-260 (Supp. 2007), 61-4-525 (Supp. 2007) and 61-6-1825 (Supp. 2007). Chad’s Place (“Petitioner”) seeks an on-premises beer and wine permit and non-profit private club license to sell liquor by the drink for its location at 2459 Great Falls Highway, Lancaster, South Carolina (“location”). Protestants George W. Waldrop, Sr., Jesse Wilson MacWatt, Andrew Hart, Amelia S. Gardner, Julia Faye Sistare, Barbara B. Gardner, and Sheriff John W. Cauthen of the Lancaster County Sheriff’s Department filed protests to the application with the South Carolina Department of Revenue (“Department”). Because of the protests, the hearing was required.

A hearing in this matter was held on May 22, 2008, at the offices of the ALC in Columbia, South Carolina. Both parties and all the Protestants appeared at the hearing.[1] Evidence was introduced and testimony was given. After carefully weighing all the evidence, I find that Petitioner’s request for an on-premises beer and wine permit and non-profit private club license to sell liquor by the drink must be denied.

FINDINGS OF FACT

Having observed the witnesses and reviewed the exhibits presented at the hearing and closely passed upon their credibility, and having taken into consideration the burden of persuasion by the parties, I make the following Findings of Fact by a preponderance of the evidence:

1. Harriett Honeycutt Wilson (“Ms. Wilson”) seeks an on-premises beer and wine permit and non-profit private club license to sell liquor by the drink for Petitioner Chad’s Place, located at 2459 Great Falls Highway, Lancaster, Lancaster County, South Carolina. The location is situated outside the city limits.

2. Petitioner is a non-profit corporation in good standing with the South Carolina Secretary of State. It has a reputation for peace and good order in the community. Petitioner’s incorporating members are Harriett Wilson, Clara Steele, and John Sellers.

3. Ms. Wilson is over the age of twenty-one (21) and of good moral character. She is a legal resident of the State of South Carolina and has maintained her principal place of abode in this state for at least thirty (30) days prior to making this application.

4. Notice of the application was lawfully posted at the location and in a newspaper of general circulation.

5. The location is a concrete block building built in approximately 1950. The location was originally operated as a retail upholstery store. In addition, the location has been occupied by the Friendship Baptist Church and by various individuals who have intermittently operated a bar in the location for approximately fifteen to twenty years. During the years the location was previously operated as a bar, alcohol was served to the bar’s patrons.[2]

6. Ms. Wilson currently leases the location from Robert Michael (Mike) Brazzell (“Mr. Brazzell”). The parties executed a lease agreement in August 2007; Petitioner leased the location for a period of one year, and the parties may renew the lease yearly thereafter. The location is situated on a piece of property purchased by Mr. Brazzell in April 2002. The property measures approximately 2.370 acres and contains several structures: two (2) concrete block buildings, one of which is the “location”; six (6) mobile homes; and two (2) residential homes.

7. The location is currently operated as a private club for the benefit and entertainment of its members. Currently, there are approximately thirty-five (35) to forty (40) members in the private club. There are three (3) pool tables and a PacMan arcade machine at the location. The location’s hours of operation are from 3:00 p.m. to 2:00 a.m. Tuesday through Saturday and from 1:00 p.m. to 2:00 a.m. on Sunday. After 11:30 p.m., individuals under the age of 21 must be accompanied by a parent while inside the location. Further, those individuals under the age of 21 must wear wrist bands to identify themselves to the Petitioner’s employees that they are under the legal drinking age.

8. Ms. Wilson is the President of the Petitioner and will oversee its day-to-day operation. She currently works as a security officer and is unable to be at the location during all hours of its operation; however, when Ms. Wilson is not at the location during its hours of operation, her son, Chad Wilson, and her husband, Mendel Wilson, assist in operating the location. Mendel Wilson is over the age of twenty-one (21). Ms. Wilson has previously managed a private club for her father. During the time while she was its manager, the club did not receive any warnings or violations concerning its alcohol permit and license. Further, Ms. Wilson stated that she prefers to be licensed and regulated by the Department concerning alcohol sales.

9. A jukebox and stereo system are operational inside the location. In addition, the Petitioner provides karaoke shows for its patrons on Friday and Saturday nights. There is no music played outside of the location, and Ms. Wilson has never received a complaint about the noise. To ensure that her neighbors are not bothered by the noise, Ms. Wilson walks the perimeter of the location to listen for the level of noise within the location. Further, Ms. Wilson agrees to pick-up any trash or debris at the location nightly to ensure that trash is not thrown onto neighboring property.

10. If granted the permit and license, Ms. Wilson intends to hire additional employees to assist her in operating the location.

11. There is adequate parking at the location: patrons may park in front of the building, and there is a parking lot behind the location. The front parking lot is designated for public safety personnel, such as Firefighters and Emergency Medical Technicians, so that in case of an emergency these individuals may leave the location as quickly as possible.

12. There are currently two entrances to the location: the primary entrance fronts Great Falls Highway, and the second entrance fronts the rear parking lot.

13. There is adequate lighting at the location.

14. There is another establishment nearby, Kickstand, which sells alcohol to its patrons.

15. It is the Petitioner’s policy that reasonable measures be taken to prevent any intoxicated person from leaving the location and driving a motor vehicle. It is also the Petitioner’s policy that reasonable measures be taken to prevent the sale of alcohol to underage persons. Ms. Wilson stated that an individual’s driver’s license – or other acceptable form of identification – will be checked at the entrance to the location and when ordering alcohol within the club to ensure that no alcohol is sold by the Petitioner’s employees to underage persons. Finally, Ms. Wilson indicated that she would be willing to invest in a machine used to check the validity of driver’s licenses and was also willing to take classes offered by the Department to prevent the sale of alcohol to underage persons.

16. Mr. Brazzell and his family live on the same property in close proximity to the location. Because of the distance, Mr. Brazzell stated that he has had many conversations over a period of several months with Ms. Wilson regarding the lease. He has had no problems with Ms. Wilson or the Petitioner’s members since it began operating in August. In fact, Mr. Brazzell is a current member and frequently takes his grandchildren to the location. Finally, Mr. Brazzell fully supports Petitioner’s application for an on-premises beer and wine permit and non-profit private club license to sell liquor by the drink.

17. Ms. Rhonda Wachob (“Ms. Wachob”) appeared and testified at the hearing on behalf of the Petitioner and Ms. Wilson. Ms. Wachob is Ms. Wilson’s close friend and provides a karaoke show at the location on Friday and Saturday nights. Like Mr. Brazell, Ms. Wachob is also a current member and frequently takes her children and grandchildren to the location. She is “comfortable” with her children’s and grandchildren’s presence at the location even if alcohol is sold at the club because Ms. Wilson and her husband ensure that all precautions are taken to prevent underage drinking and drunk driving. And while Ms. Wachob lives approximately thirty-eight (38) miles from the location, she regularly visits the location as she believes it is a great place for people of all ages to gather and socialize with others.

18. Thomas (Tom) William Holland, Sr. (“Mr. Holland”) appeared and testified at the hearing on behalf of Protestant Lancaster County Sheriff’s Department. Mr. Holland is a staff attorney and Level III Law Enforcement Officer with the Sheriff’s Department. His primary concern with the location is the possible sale of alcohol to young persons in the community. As an employee of the Sheriff’s Department, Mr. Holland is keenly aware of situations that have arisen at the location under previous ownership as well as similar establishments in the area. With regard to similar establishments in the area, Mr. Holland referenced situations such as disorderly conduct, public drunkenness, shootings, and various narcotics activity. In closing, Mr. Holland acknowledged that the Sheriff’s Department has not had any calls or problems specific to the Petitioner, and he is also aware that the owners of the Petitioner are not connected to any other businesses in the area which have had the problems as referenced above.

19. In addition to the Lancaster Sheriff’s Department, George Wallace Waldrop, Sr. (“Mr. Waldrop”), Andrew Hart, Amelia S. Gardner, Julia Faye Sistare, and Barbara B. Gardner filed individual protests to the application and appeared at the hearing. Because each of the protestants’ concerns are similar, Mr. Waldrop spoke on behalf of the protestants. The protestants are life-long residents of this area and live across the street from or in the immediate vicinity of the location. Mr. Waldrop expressed many concerns regarding the location and Petitioner’s operation of the private club. Mr. Waldrop’s primary concern relates to the proximity of the location to neighboring residences. Specifically, there are several single-family dwellings situated on the same property as the location. Children reside in these homes, and Mr. Waldrop expressed much concern for the safety and well-being of these children in such close proximity to a private club, especially if the instant application is granted. The location is also situated on a four-lane highway and the speed-limit of the highway in front of Petitioner’s building is fifty-five (55) miles per hour.

Mr. Waldrop also questioned the credibility of the Petitioner and its management: in a newspaper interview, Ms. Wilson stated that the club would be a “clean, fun, friendly nightlife environment, featuring entertainment without alcohol or drugs”; however, notice of the application for the instant matter was submitted to the same newspaper on the same date the interview was printed. Finally, during the hearing Ms. Wilson stated that the younger crowd enjoyed “hanging out” at the location and especially enjoyed drinking alcohol-free daiquiris. Mr. Waldrop was “very disturbed” by this statement and believed that this kind of environment would foster underage drinking. In closing, Mr. Waldrop expressed the protestants’ desire that the neighborhood remain a nice, peaceful residential area, that the safety of the children in the homes in close proximity to the location be considered, and that the location’s proximity and surrounding geography be considered in this matter.

20. Jesse Wilson MacWatt (“Mr. MacWatt”) also filed a protest to the application and appeared at the hearing. Mr. MacWatt voiced his agreement in the concerns expressed by Mr. Waldrop; however, he stated additional concerns concerning the location. Mr. MacWatt’s property and primary residence is situated directly adjacent to the location. He is very concerned about the management and noise emitting for the location during karaoke nights. Mr. MacWatt stated that he and his wife are often woken up by the noise during karaoke nights. He is also concerned about potential littering problems as he was forced to remove beer cans and other trash from his property daily during the time period prior establishments operated at the location.

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 (2005 & Supp. 2007) grants jurisdiction to the Administrative Law Court to hear contested cases under the Administrative Procedures Act.

2. S.C. Code Ann. § 61-2-260 (Supp. 2007) grants the Administrative Law Court the responsibility to determine contested cases matters governing alcoholic beverages, including beer, wine and liquor.

3. S.C. Code Ann. § 61-4-520 (Supp. 2007) sets forth the requirements for the issuance of a beer and wine permit. Included in the criteria is the requirement that the proposed location be a suitable one.

4. S.C. Code Ann. § 61-6-1600 (Supp. 2007) sets forth the requirements for the issuance of a non-profit private club liquor-by-the-drink license. Section 61-6-1600(A) provides that “[a] member or guest of a member of a nonprofit organization may consume alcoholic liquors sold by the drink upon the premises between the hours of ten o’clock in the morning and two o’clock the following morning.”

5. S.C. Code Ann. Reg. 7-401.4(A) elaborates further on the criteria used in determining is an entity is a “bona fide nonprofit organization:

Every initial and/or renewal application for a Sale and Consumption of Alcoholic Liquors License to a bona fide nonprofit organization shall be an association, organization or a nonprofit corporation organized and existing under the laws of the State of South Carolina and operated solely and exclusively for social, benevolent, patriotic, recreational or fraternal purposes but not for pecuniary gain or profit, no part of the net earnings of which inures to the direct benefit of any member or shareholder, . . . [and that a license] only [be issued] to a bona fide nonprofit organization with limited membership to which the sale of alcoholic beverages is incidental to the main purpose of the organization.

6. S.C. Code Ann. § 61-6-120 (Supp. 2007) provides that a liquor license shall not be issued to a place of business if:

the place of business is within three hundred feet of any church, school, or playground situated within a municipality . . . . Such distance shall be computed by following the shortest route of ordinary pedestrian or vehicular travel along a public thoroughfare from the point of the grounds in use as part of such church, school, or playground . . . .

23 S.C. Code Ann. Reg. 7-303 (Supp. 2007) clarifies how distances from the location to schools, churches, and playgrounds are measured:

With respect to a church or a school, the distance shall be measured from the nearest entrance of the place of business by following the shortest route of ordinary pedestrian or vehicular travel along the public thoroughfare to the nearest point of entrance to the grounds of the church or school, or any building in which religious services or school classes are held, whichever is the closer. The South Carolina Department of Revenue has determined that the grounds in use as part of the church or school is restricted to the grounds immediately surrounding the building or buildings which provide ingress or egress to such building or buildings and does not extend to the grounds surrounding the church which may be used for beautification, cemeteries, or any purpose other than such part of the land as is necessary to leave the public thoroughfare and to enter or leave such building or buildings. Only one entrance to the grounds of a church or school shall be considered, to wit: the entrance to the grounds nearest an entrance to the church or school building. Where no fence is involved, the nearest entrance to the grounds shall be in a straight line from the public thoroughfare to the nearest door. The nearest point of the grounds in use as part of a playground shall be limited to the grounds actually in use as a playground and the grounds necessary for ingress or egress to such grounds from the public thoroughfare.

7. 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. ABC 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 of an applicant for alcohol permits and licenses using broad but not unbridled discretion. Byers v. S.C. ABC Comm’n, 281 S.C. 566, 316 S.E.2d 705 (Ct. App. 1984).

8. 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 a 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 Woodall v. Woodall, 322 S.C. 7, 10, 471 S.E.2d 154, 157 (1996).

9. Although ‘proper location” is not statutorily defined, the Administrative Law Court is vested, as the trier of fact, with the authority to determine the fitness or suitability of a particular location. Fast Stops, Inc. v. Ingram, 276 S.C. 593, 281 S.E.2d 181 (1981). The determination of suitability of location is not necessarily a function solely of geography. It involves an infinite variety of considerations related to the nature and operation of the proposed business and its impact upon the community within which it is to be located. Kearney v. Allen, 287 S.C. 324, 338 S.E.2d 335 (1985). In determining the suitability of a location, it is proper for this Court to consider any evidence that demonstrates any adverse effect the proposed location will have on the community. Palmer, supra. It is also relevant to consider the previous history of the location. Smith v. Pratt, 258 S.C. 504, 189 S.E.2d 301 (1972); Taylor v. Lewis, et al., 261 S.C. 168, 198 S.E.2d 801 (1973). Furthermore, in considering the suitability of a location, it is relevant to consider whether the testimony in opposition to the granting of a license is based on opinions, generalities and conclusions, or whether the case is supported by facts. Id.

10. Unless there is sufficient evidence of an adverse impact on the community, the application must not be denied if the statutory criteria are satisfied. The fact that a Protestant objects to the issuance of a permit is not a sufficient reason by itself to deny the application. See 48 C.J.S. Intoxicating Liquors § 166 (2004).

11. Permits and licenses issued by this state for the sale of liquor, beer and wine are not property rights. Rather, they are privileges granted in the exercise of the State’s police power to be used and enjoyed only so long as the holder complies with the restrictions and conditions governing them. The Administrative Law Court, as the tribunal authorized to grant the issuance of a permit, is likewise authorized to revoke or suspend the permit for cause. See Feldman v. S.C. Tax Commission, 203 S.C. 49, 26 S.E.2d 22 (1943).

12. Furthermore, S.C. Code Ann. Reg. 7-200.1(I) (Supp. 2007) authorizing the imposition of restrictions on permits, provides:

Any written stipulation and/or agreement which is voluntarily entered into by an applicant for a permit or license between the applicant and the Department, if accepted by the Department, will be incorporated into the basic requirements for the enjoyment and privilege of obtaining and retaining the permit or license and shall have the same effect as any and all laws and any and all other regulations pertaining to the permit or license.

Knowing violation of the terms of the stipulation or agreement shall constitute sufficient grounds to revoke said license.

13. The Department may seek revocation or suspension of permits for the sale of beer and wine “on its own initiative or on complaint signed and sworn to by two or more freeholders resident for the preceding six months in the community in which the licensed premises are located or by a local peace officer, all of whom are charged with the duty of reporting immediately to the department a violation of the provisions of section 61‑4‑580 . . . .” S.C. Code Ann. § 61-4-590 (Supp. 2007). The Department may also seek to suspend or revoke a liquor-by-the-drink license pursuant to S.C. Code Ann. § 61-6-1830 (Supp. 2007).

14. Based upon the testimony of the witnesses presented at the hearing, I find that the location is not suitable for the issuance of an on-premises beer and wine permit and non-profit private club license to sell liquor by the drink. It is located in a densely residential area with one other retail business approximately one mile away that is permitted and licensed for the sale of beer, wine, and liquor for on-premises consumption. This Court is greatly concerned by the location’s hours of operation, particularly on Sunday night, and its proximity to neighboring residences, most of which are occupied by families with small children. Byers v. S.C. Alchohoic Beverage Control Comm’n, 305 S.C. 243, 246, 407 S.E.2d 653, 655 (1991) (holding that proximity to a residence is by itself sufficient to support a finding of unsuitability and denial of a permit); Kearney v. Allen, 287 S.C. 324, 338 S.E.2d 335 (1985) (upholding the denial of a beer and wine permit and liquor license to a large “country-western music lounge-restaurant” with late closing times, because of the adverse impact the location would have upon the surrounding residential community and nearby school). The location’s current closing time is 2:00 a.m., including Sunday night: the Court is puzzled as to why the location would stay open on Sunday night/Monday morning until 2:00 a.m., especially when testimony was given that this is a “family-oriented” establishment. Further, testimony was given concerning the high level of noise emitting from the location during Friday and Saturday nights. Neighboring residents have the right to be free from heightened noise levels from the location on karaoke nights as well as every other night the location is open for business. “The right of a person to use his own property does not entitle him to violate the peace and comfort of others in the vicinity.” 3 S.C. Juris. Breach of Peace § 7 (1991).

Also of importance is the interview Ms. Wilson gave to a local newspaper regarding the opening of the Petitioner:

Business name: Chad’s Game Room

Owner: Harriet and Mendel Wilson

Hours: 1 p.m. until

Address: 2459 Great Falls Highway, Lancaster

Phone: 283-3580

Email: chadsgamerm@comporium.net

What do you offer? Pool tables, foosball, video games, music, dance floor and a variety of snacks and drinks, including smoothies, milk shakes and non-alcoholic beverages.

What would you say is special about your business? Clean, fun, friendly nightlife environment, featuring entertainment without alcohol or drugs

What was your inspiration or motivation for starting this business? Through our 18-year-old son and his friends, we always hear they have no place to “hang out,” except slipping into a bar or hanging on the street. We wanted to create a place for them to enjoy, and at the same time be safe and stay away from trouble.

Do you have a slogan or motto? The Perfect Hang-out Place.

Yet, on the same day in the same newspaper, notice of the Petitioner’s application for a beer and wine permit and liquor license was published pursuant to § 61-6-180. During the hearing, Ms. Wilson stated that the newspaper incorrectly quoted her regarding serving alcohol at the location, and that she responded to the inaccurate article by submitting a Letter to the Editor. However, Ms. Wilson did not submit into evidence a copy of such a submission to the Editor. Further, given the name of the club and the reason for its organization, it’s unlikely that the newspaper misinterpreted the entire interview with Ms. Wilson.

While the Court is certainly respectful of Ms. Wilson’s desire to create this club for the benefit and entertainment of her family and friends, the Court finds and concludes that the issuance of the requested permit and license would have an adverse impact on the community: the location is therefore not a proper one and is unsuitable. Accordingly, I conclude that Petitioner’s application for an on-premises beer and wine permit and non-profit private club license to sell liquor by the drink must be denied.

ORDER

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

IT IS HEREBY ORDERED that the application for an on-premises beer and wine permit and non-profit private club license to sell liquor by the drink by Chad’s Place, 2459 Great Falls Highway, Lancaster, South Carolina is DENIED.

AND IT IS SO ORDERED.

__________________________________

June 4, 2008 Marvin F. Kittrell

Columbia, South Carolina Chief Judge