SC Administrative Law Court Decisions

STATEMENT OF THE CASE

This matter comes before the Administrative Law Court (ALC or Court) pursuant to S.C. Code Ann. §§ 61-2-90 & 61-2-260 (Supp. 2007) and S.C. Code Ann. §§ 1-23-310 et seq. (Supp. 2007) for a contested case hearing. Petitioner is seeking an on-premises beer and wine permit and liquor by the drink license for Shawty’s Bar & Grill (Shawty’s). After proper notice, a hearing was held on August 12, 2008 at the offices of the ALC in Columbia, South Carolina.

STIPULATIONS OF FACT

1. On October 3, 2007, South Carolina Law Enforcement Division (SLED) conducted an investigation of Shawty’s to determine their qualification for an on premises beer and wine permit and restaurant liquor by the drink license at 6539 Two Notch Road, Columbia, South Carolina.

2. During the course of its investigation, SLED found that Shawty’s failed to meet the restaurant requirements of S.C. Code Ann. § 61-6-20 and 23 S.C. Code Ann. Regs. 7-401.3. Specifically, SLED found that the location does not have the following:

a) a kitchen that is separate and distinct and used solely in the preparation of food.

b) a working fixed grill, stove, or microwave oven in the kitchen.

c) seating for not less than 40 persons simultaneously at tables for service of meals.

d) a menu or sign listing the meals offered for service.

e) adequate food on the premises to serve 40 people a hot meal.

f) a functioning cold storage unit with a minimum of 21 feet cubic capacity for food storage.

3. The parties stipulate that SLED’s finding related to Shawty’s failure to meet the restaurant requirements of S.C. Code Ann. § 61-6-20 and 23 S.C. Code Ann. Regs. 7-401.3 are true, accurate, and correct.

4. The parties stipulate the Applicant does not hold a Grade A retail establishment food permit from the Department of Health and Environmental Control, as is required for the requested license.

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 proof upon the Petitioner and the Respondents, I make the following Findings of Fact by a preponderance of the evidence:

1. Petitioner seeks an on-premises beer and wine permit and liquor by the drink license for Shawty’s Bar & Grill, located at 6539 Two Notch Road, Columbia, South Carolina Sylvester Jordan, the owner of Shawty’s, has been a resident of South Carolina for over ten years. The testimony established that he was of good moral character. He also has not had a permit or license revoked within the last two (2) years and notice of the application was lawfully posted both at the location and in a newspaper of general circulation.

2. Shawty’s intends to have seating for approximately fifty to one-hundred patrons. There are multiple buildings in the same vicinity but a fence currently separates each of the buildings parking lots. However, Shawty’s intends to use their back door as the main entrance and encourage patrons to park in the lot behind the building. There is sufficient lighting at both the front and rear of the building, focused on the parking lots.

Shawty’s will be operated as a sports bar and grill, specializing in soul food such as black eyed peas, collards, cabbage, yams, fried chicken, and chittlins. On occasion, there may be a jazz band or karaoke machine at the restaurant for entertainment. If a beer and wine permit and liquor by the drink license are issued, Mr. Jordan would like to operate between the hours of 11 a.m. and 10 p.m. Monday through Thursday and from 11 a.m. to 1 a.m. on Friday and Saturday. Furthermore, Mr. Jordan testified that Shawty’s would not be open on Sunday.

3. The proposed location is in a predominately commercial area which is zoned for commercial use. A previous business under different ownership was permitted to serve beer and wine in the same location approximately ten years ago. There was little evidence regarding the evolution in this area in the five years immediately following the operation of that business, though the evidence indicates that in the past five years the area has been fairly stable. However, recently New Christian Hope Center began operating in the vicinity of the location and based upon 23 S.C. Code Ann. Regs. 7-303 (Supp. 2006) the church is located 538 feet from Shawty’s.

4. Charles Graham and Pastor Stanley Davis protested the granting of Shawty’s permit and license. Mr. Graham testified that there is not enough parking to accommodate all of the patrons Shawty’s would attract. However, I find that the proposed location does have adequate parking for the proposed business.

Pastor Davis expressed a genuine concern for the youth in the area and the impact Shawty’s will have on his church. Pastor Davis testified that the area has existing problems with crime such as prostitution and drugs. He also often finds beer bottles, condoms and food littering the parking lot of his church. Furthermore, he believes that more alcohol will only exacerbate the crime and drugs in the area. Nonetheless, Pastor Davis explained that with the help of the local law enforcement the community has been undergoing marked improvement.

5. As explained below, in order to deny this permit and license, direct evidence of an adverse impact on the community is necessary. Moreover, since the proposed location has been permitted to serve beer and wine in the past ten years, the Protestant must show that the location is less suitable for the sale of beer, wine or alcohol than during the prior period of licensure. See Taylor v. Lewis, 261 S.C. 168, 198 S.E.2d 801 (1973).

Here, the Petitioner proposes to operate a bar and grill whose primary purpose is the service of food. As Mr. Jordan testified he simply wants to open a business that will bring “soul food” to the community. In other words, the business will be operated as a neighborhood restaurant that also serves beer, wine, and liquor. I do not find that such a business would create an adverse impact to the community. In fact, I find that a business of that nature would potentially improve the community. Nevertheless, I equally recognize the strives that Pastor Davis and law enforcement have made in improving this community and the potential impact that a bar could have in adversely impacting those improvements.

Thus, I find that the proposed location is suitable for an on-premise beer and wine permit and liquor by the drink license. Nevertheless, the determination of suitability is solely limited to the operation of the location in keeping with the facts set forth above and the restrictions set forth below to insure that this business is operated in keeping with those affirmations. Any operation of this business outside of these parameters would be deemed unsuitable.^[1]

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

2. S.C. Code Ann. § 61-4-520 (Supp. 2007) sets forth the requirements for the issuance of a beer and wine permit. Section 61-4-520(5) provides that the location of the proposed place of business must be a proper one. Furthermore, Section 61-4-520(6) provides that in making that determination, the Department, and thus the ALC, “may consider, among other factors, as indications of unsuitable location, the proximity to residences, schools, playgrounds, and churches.”

3. A license for the sale and consumption of alcoholic beverages must not be granted unless the provisions of S.C. Code Ann. § 61-6-1820 (Supp. 2007) are met. Section 61-6-1820(1) provides that the applicant may receive a license upon the finding that “[t]he applicant is a bona fide nonprofit organization or the applicant conducts a business bona fide engaged primarily and substantially in the preparation and serving of meals or furnishing of lodging.” In addition, a license for the sale and consumption of alcoholic beverages must not be granted unless an individual applicant is of good moral character or, if the applicant is a corporation or association, it “has a reputation for peace and good order in its community, and its principals are of good moral character.” S.C. Code Ann. § 61-6-1820(2) (Supp. 2007). Section 61-6-1820(3) further provides that a sale and consumption license shall not be granted unless the proposed location meets the minimum distance requirements from churches, schools, or playgrounds as forth in S.C. Code Ann. § 61-6-120 (Supp. 2006). Section 61-6-120(A) requires that a location outside of a municipality licensed to sell liquor must be a minimum of five hundred (500) feet from any church, school, or playground. The distance is determined by following “the shortest route of an ordinary pedestrian or vehicular travel along the public thoroughfare from the nearest point of the grounds in use as part of such church, school or playground. . . .”

4. 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 118 (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 the adverse effect the proposed location will have on the community. Palmer v. S.C. ABC Comm’n, 282 S.C. 246, 317 S.E.2d 476 (Ct. App. 1984). 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, 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 is a significant consideration. Smith v. Pratt, 258 S.C. 504; Taylor v. Lewis, 261 S.C. 168.

“A liquor license or permit may also be properly refused on the ground that the location of the establishment would adversely affect the public interest, that the nature of the neighborhood and of the premises is such that the establishment would be detrimental to the welfare . . . of the inhabitants, or that the manner of conducting the establishment would not be conducive to the general welfare of the community.” 48 C.J.S. Intoxicating Liquors § 168 at 366 (2004). Nevertheless, if the statutory criteria are satisfied, a permit or license should not be denied upon these grounds without sufficient evidence of an adverse impact on the community. Moreover, the fact that a person objects to the issuance of a permit or license does not establish a sufficient reason by itself to deny the application. See 48 C.J.S. Intoxicating Liquors § 166 (2004).

5. Permits and licenses issued by this State for the sale of liquor, beer and wine are not property rights. They are, rather, 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, may thus place restrictions or conditions on these permits or licenses. See Feldman v. S.C. Tax Commission, 203 S.C. 49, 26 S.E.2d 22 (1943). Furthermore, 23 S.C. Code Ann. Regs. 7-200.1(I) (Supp. 2006) 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.

6. Based upon the evidence presented, Petitioner meets the statutory requirements for holding an on-premises beer and wine permit at the proposed location with the following restrictions. Furthermore, Petitioner has ninety (90) days in which to meet the requirements of S.C. Code Ann. § 61-6-20 and 23 S.C. Code Ann. Regs. 7-401.3 for a restaurant liquor license.

ORDER

Based upon the above Findings of Fact and Conclusions of Law, it is hereby:

ORDERED that the application for an on-premise beer and wine permit and liquor by the drink license of Shawty’s Bar & Grill be granted upon Petitioner entering into a written agreement with the Department incorporating the restrictions set forth below:

1. The nature and character of the business shall remain that of a restaurant, with drinks to compliment the sale of food.

2. The Petitioner shall only be permitted to serve beer, wine or alcohol between the hours of 7 a.m. and 11 p.m. with the exception of Fridays and Saturdays, in which the Petitioner may serve beer, wine or alcohol until 12:30 a.m. The Petitioner shall not serve alcohol on Sunday.

IT IS FURTHER ORDERED that a violation of the above restrictions will be considered a violation against the permit/license and may result in a fine, suspension or revocation.

IT IS FURTHER ORDERED that within ninety (90) days, Petitioner notify the Department when they have met the statutory requirements for a restaurant liquor license.

IT IS FURTHER ORDERED that upon a satisfactory SLED investigation, the Department resume processing Petitioner’s application and, incorporating a written agreement of the above named restrictions, issue an on-premise beer and wine permit and liquor by the drink license to the Petitioner upon a satisfactory final inspection and payment of the proper fees and costs.

AND IT IS SO ORDERED.

____________________________________

Ralph King Anderson III

Administrative Law Judge

August 19, 2008

Columbia, South Carolina