SC Administrative Law Court Decisions

STATEMENT OF THE CASE

This matter comes before this Court pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2004), S.C. Code Ann. § 1-23-600(B) (Supp. 2004), and S.C. Code Ann. §§ 1-23-310 et seq. (2005) for a contested case hearing. Petitioner M&R Enterprises, Inc., seeks an on-premises beer and wine permit and a non-profit private club minibottle license for a private club, known as Hitchhiker, located at 421 New Orangeburg Road in Lexington, South Carolina. Respondent South Carolina Department of Revenue (Department) would have granted the permit and license but for the protests filed by the Lexington County Sheriff’s Department and two neighboring residents regarding the suitability of the proposed location. Accordingly, the Department was excused from appearing at the hearing of this matter. By a letter dated March 22, 2005, the Lexington County Sheriff’s Department withdrew its protest of Petitioner’s permit and license application.

After timely notice to the parties and the protestants, a hearing of this case was held on March 31, 2005, at the South Carolina Administrative Law Court in Columbia, South Carolina. Based upon the evidence presented concerning the suitability of the proposed location and upon the applicable law, I find that Petitioner’s application for an on-premises beer and wine permit and non-profit private club minibottle license should be granted.

FINDINGS OF FACT

Having carefully considered all testimony, exhibits, and arguments presented at the hearing of this case, 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.On November 29, 2004, Myra Hutchins submitted an application on behalf of M&R Enterprises, Inc., to the Department for an on-premises beer and wine permit and a non-profit private club minibottle license for the premises located at 421 New Orangeburg Road in Lexington, South Carolina. This application and the Department’s file on the application are hereby incorporated into the record by reference.

2.Petitioner M&R Enterprises, Inc., is a South Carolina non-profit corporation, incorporated on November 29, 2004, and currently in good standing with the South Carolina Secretary of State. Ms. Hutchins and her husband, Ralph Hutchins, are the incorporators and principals of M&R Enterprises, and Ms. Hutchins serves as the president and registered agent of the corporation. The articles of incorporation for M&R Enterprises specify that the corporation is a non-profit, public benefit corporation, and its bylaws set forth requirements such that the corporation complies with 23 S.C. Code Ann. Regs. 7-401.4(A)-(F) (Supp. 2004). There is no evidence in the record suggesting that M&R Enterprises, Inc., does not have a reputation for peace and good order in the surrounding community.

3.Ms. Hutchins and Mr. Hutchins are over twenty-one years of age and do not have any delinquent state or federal taxes. Further, the South Carolina Law Enforcement Division (SLED) conducted a criminal background investigation of Ms. Hutchins and Mr. Hutchins that did not reveal any criminal arrests or convictions, and the record does not indicate that either Ms. Hutchins or Mr. Hutchins has engaged in acts or conduct implying the absence of good moral character. Further, it is worth noting that Ms. Hutchins is retired from the South Carolina Alcoholic Beverage Control Commission and SLED, with whom she had a combined twenty-seven years of employment related to the enforcement of violations of the alcoholic beverage laws, and Mr. Hutchins was employed as a captain in the Lexington County Sheriff’s Department during the 1970s.

4.Notice of Petitioner’s application was published in the Lexington County Chronicle, a newspaper of general circulation in Lexington County, South Carolina, once a week for three consecutive weeks, and proper notice of the application was posted at the proposed location for fifteen days.

5.The proposed location is situated near the intersection of New Orangeburg Road, South Lake Drive, and Cross Road in a predominantly rural area of Lexington County. While there are no churches, schools, or playgrounds in the vicinity of the proposed location, there are several residences near the location, including one residence directly across Cross Road from the location. The proposed location has a history of being licensed for the sale of beer and wine dating back to the 1970s, and has been licensed with an on-premises beer and wine permit and minibottle license since 1993.

6.Mr. Hutchins purchased the property in question approximately eight years ago, and, until recently, leased the proposed location to other organizations for the operation of a private club. However, because of the disorderly manner in which the private club at the location was being operated, Mr. Hutchins terminated the lease of the most recent tenant, and he and Ms. Hutchins decided to operate a private club at the location themselves. Rather than acting as landlords, Mr. Hutchins and Ms. Hutchins will be responsible for the day-to-day operations of their club, and intend to run a club that draws a significantly older membership than prior establishments at the location and that generally operates in a more orderly fashion than those prior clubs. And, during its recent operations under a temporary permit and license, the Hutchins’ club appears to have operated in such a manner. Further, at the hearing of this case, the Hutchins agreed to mechanically restrict the volume of the jukebox in the establishment such that any music emanating from the club will not disturb neighboring residents.

7.Protestants Cindy and Jimmy Moore live directly across Cross Road from the proposed location, and have experienced problems with prior clubs at the location for over ten years. Ms. Moore primarily described noise disturbances caused by music emanating from the club and from unruly patrons entering and existing the club. Because of these noise problems, Ms. Moore has contacted the Lexington County Sheriff’s Department on numerous occasions, including several times since the previous permit and license was issued in 2003. However, Ms. Moore stated that she had not filed any noise complaints since November 2004. Mr. Moore testified that, during the operations of previous clubs, he has witnessed fights; weapons being fired, including one such incident within the past five months; public urination, by both male and female patrons of the clubs; illegal drug use; and littering, including beer bottles and other trash left in his yard.

CONCLUSIONS OF LAW

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

1.Jurisdiction over this case is vested with the South Carolina Administrative Law Court pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2004), S.C. Code Ann. § 1-23-600(B) (Supp. 2004), and S.C. Code Ann. §§ 1-23-310 et seq. (2005).

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. § 61-4-520 (Supp. 2004) establishes the criteria for the issuance of a beer and wine permit. Included in the criteria is the requirement that the proposed location be a proper and suitable one. See id. § 61-4-520(6)-(7).

5.S.C. Code Ann. § 61-6-1820 (Supp. 2004) sets forth the basic criteria for the issuance of a minibottle license. Although the suitability of the proposed location is not listed in Section 61-6-1820 as a condition of licensing, such a consideration is proper. See Schudel v. S.C. Alcoholic Beverage Control Comm’n, 276 S.C. 138, 276 S.E.2d 308 (1981).

6.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).

7.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).

8.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)).

9.However, without sufficient evidence of an adverse impact on the community, a permit application must not be denied if the statutory criteria are satisfied. The fact that the issuance of a permit or license is protested is not a sufficient reason, by itself, to deny the application. See 48 C.J.S. Intoxicating Liquors § 119 (1981).

10.In the case at hand, I find that the proposed location is suitable for Petitioner’s private club. While this tribunal does not diminish or disregard the difficulties the protestants have had with prior establishments at this location, I find—and expect—that, given the Hutchins’ experience in alcoholic beverage enforcement and law enforcement and given the older membership of the current club, Petitioner will likely operate a more orderly establishment that will coexist more harmoniously with its neighbors than previous clubs at the location.

However, Petitioner is reminded that

[l]iquor licenses are neither contracts nor rights of property. They are mere permits, issued or granted in the exercise of the police power of the state to do what otherwise would be unlawful to do; and to be enjoyed only so long as the restrictions and conditions governing their continuance are complied with.

Feldman v. S.C. Tax Comm’n, 203 S.C. 49, 56, 26 S.E.2d 22, 25 (1943). Accordingly, if Petitioner commits any violation of the statutes and regulations governing the sale of beer, wine, and alcoholic liquors, such a violation is grounds for the revocation or suspension of its permit and license. See S.C. Code Ann. §§ 61-2-140(E), 61-4-580, 61-6-1830 (Supp. 2004). Among such violations are permitting “lewd, immoral, or improper entertainment, conduct, or practices” and permitting “any act, the commission of which tends to create a public nuisance or which constitutes a crime under the laws of this State.” S.C. Code Ann. § 61-4-580(4), (5) (Supp. 2004). These violations may be referred to the Department for enforcement action by two or more freeholders resident for more than six months in the community surrounding the licensed premises. S.C. Code Ann. § 61-4-590 (Supp. 2004). Further, even though a location has been found suitable for a particular permit or license at one time, the manner in which the establishment at that location is operated may render the location unsuitable for future operations of that character. Therefore, while this tribunal finds the location in question currently suitable for Petitioner’s proposed operations, Petitioner is cautioned that, if the operations of its private club lead to a resumption of the problematic activities of prior establishments at the location, its permit and license may be placed in jeopardy.

11.Here, Petitioner meets all of the statutory and regulatory criteria enacted by the South Carolina General Assembly for the issuance of an on-premises beer and wine permit and non-profit private club minibottle license, and there has not been a sufficient evidentiary showing that the proposed location is unsuitable for Petitioner’s private club, as currently operated, or that the issuance of the permit and license to Petitioner would have an adverse impact on the surrounding community. Therefore, I find that Petitioner’s application for a beer and wine permit and minibottle license should be granted.

ORDER

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

IT IS HEREBY ORDERED that the Department shall GRANT Petitioner’s application for an on-premises beer and wine permit and non-profit private club minibottle license for the premises located at 421 New Orangeburg Road in Lexington, South Carolina.

AND IT IS SO ORDERED.

______________________________

JOHN D. GEATHERS

Administrative Law Judge

April 13, 2005

Columbia, South Carolina