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. 2003). The South Carolina Department of Revenue
(Department) seeks revocation of Respondent’s off-premise beer and wine permit
for its fourth violation of 23 S.C. Code Ann. Regs. 7-200.4 (eff. June 27, 2003).
A hearing was held before me on June 6, 2005 at the offices of the
Administrative Law Court in Columbia, South Carolina.
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 Court
has personal and subject matter jurisdiction.
2. Notice
of the date, time, place and nature of the hearing was timely given to all
parties.
3. Respondent
Southern Convenience Stores, Inc., d/b/a Southern Convenience #639, which
is located at I-26 and Hwy 56 in Clinton, South Carolina, holds a permit
(Permit No. 32021272-PBG) issued by the Department that permits it to sell
beer and wine for off-premise consumption.
4. As
stipulated by Respondent, on November 13, 2004, South Carolina Law Enforcement
Division (SLED) agents conducted an investigation of Respondent’s business at
the permitted location in conjunction with an underage cooperating individual
(UCI), Joshua Kingsmore, who was eighteen (18) years of age. The UCI entered
the location at the above-referenced address and purchased a 24 ounce can of
Bud Light beer from the clerk on duty. The clerk did request identification
from the UCI and he presented his driver’s license which reflected that he was
under the age of twenty-one (21). The clerk, Respondent’s employee Jennifer
Wade, then permitted the UCI to purchase the beer.
5. Ms. Wade
was charged with the transfer of beer to an individual under the age of
twenty-one (21). Additionally, Respondent was issued an administrative
citation for permitting an under-aged person to purchase beer on a licensed
premises, in violation of Regulation 7-200.4.
6. Respondent
has had three prior violations within a three-year period at this specific
location. All of these violations were for permitting the purchase of beer by
a person under the age of twenty-one (21). The first violation was committed
on January 28, 2003, the second on February 14, 2003, and the third on March
29, 2004.
7. The
Department issued its Final Department Determination in this matter on
March 30, 2005, seeking to
permanently revoke Respondent’s beer and wine permit.
8. Respondent’s
President and CEO, Michael Frost, appeared on behalf of the corporation. Mr.
Frost has extensive experience in operating convenience stores and has authored
programs aimed at preventing the sale of alcohol to minors. He operates a
total of seventy-three (73) stores in North and South Carolina, with thirty-seven
(37) of those stores located in South Carolina.
9. Respondent
has a zero tolerance policy on sales of alcohol to minors. Any employee who
sells to a minor is automatically terminated. Respondent terminated Jennifer
Wade after this violation occurred. Kristina Sisk, who was the store manager
at this location when the violation occurred, was also terminated.
10. Respondent
also provides extensive training to its employees. Respondent holds a three day
on-the-job training session for all new employees which is conducted primarily
by the store manager. During the training, heavy emphasis is placed on
checking customer identification regarding the purchase of alcohol and tobacco
products. It is Respondent’s policy to check the identification of all
customers wishing to purchase alcohol who appear to be under the age of
twenty-five (25).
11. Employees
also complete the Training for Intervention Procedures (TIPS) program, which is
given by a TIPS certified trainer.
TIPS is a national one day interactive training program of which approximately
three hours are dedicated to alcohol sales to minors. During the training,
employees are provided a training manual that is reviewed step by step.
Employees also view videos and complete a test at the end of the training
session which is graded by an outside agency. Respondent’s employees receive
TIPS training within thirty (30) days of hire. However, Ms. Wade, who had been
an employee of the store for three months before her termination, had not yet
received TIPS training.
To date,
approximately 90% of the company’s employees have undergone TIPS training.
Respondent intends to increase the number of TIPS trainers and have 100% of its
employees TIPS trained. In addition to the on-the-job and TIPS training, Respondent
has the State Law Enforcement Division (SLED) train its employees on the issue
of sales of alcohol to minors.
12. Respondent
uses Tele-Check, an automated check cashing system, to assist in verifying the
age of customers. Cashiers are required to verify the age of a customer
wishing to purchase alcohol by typing in the customer’s date of birth. The
machine will then show the age of the customer. However, this location was not
connected up to the Tele-Check system at the time the violation occurred.
13. Respondent
also has a “We Card” calendar by the register at the location to assist
cashiers in verifying a customer’s age.
14. Respondent
provides incentives to employees who have an underage customer attempt to
purchase alcohol. The employees receive $100 if they hold the license of an
underage customer attempting to purchase alcohol and contact authorities.
15. Kevin
Payne is the territory manager over the store where the violation occurred. He
did some personal training with Ms. Wade, which included explaining the store’s
policy and state laws regarding alcohol sales to minors. He also reminded her
of the policy and laws regarding alcohol sales to minors each time he went to
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) grants jurisdiction to the ALC to hear contested
cases under the Administrative Procedures Act. Specifically, S.C. Code Ann. §
61-2-260 (Supp. 2003) 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
Commission, 203 S.C. 49, 26 S.E. 2d 22 (1943).
3. Holders
of beer and wine permits are forbidden from permitting “any act, the commission
of which tends to create a public nuisance or which constitutes a crime. . . .
” S.C. Code Ann. § 61-4-580(5) (Supp. 2003).
4. 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 license or a
permit. Such a violation constitutes sufficient grounds for either suspension
or revocation of the beer and wine permit. 23 S.C. Code Ann. Regs. 7-200.4
(effective June 27, 2003).
5. The
permittee is responsible for all acts of his servants, agents, or employees and
cannot seek to avoid the consequences of a violation for lack of personal
knowledge. Following that principle, the South Carolina Supreme Court upheld a
civil forfeiture of a corporation’s boat based upon an employee’s transporting
drugs even though the corporation claimed the use of the boat to transport
drugs was without its knowledge. South Carolina Law Enforcement Division v.
The "Michael and Lance,” 281 S.C. 339, 315 S.E. 2d 171 (Ct. App.
1984). The Court held that “[a] principal is affected with constructive
knowledge of all material facts of which its agent receives notice while acting
within the scope of his authority.” Id. at 173, citing Crystal Ice
Co. of Columbia, Inc. v. First Colonial Corp., 273 S.C. 306, 257 S.E. 2d
496 (1979). Likewise, the license holder is responsible for the actions and
conduct of employees utilizing the permit upon the permitted premises. 48
C.J.S. Intoxicating Liquors § 259 (1981).
6. In this
case, the Department seeks revocation of Respondent’s beer and wine permit for
a fourth violation of Regulation 7-200.4. See S.C. Revenue Procedure 04-4.
7. Inherent
in and fundamental to the powers of an Administrative Law Judge, as the trier
of fact in contested cases under the Administrative Procedures Act, is the
authority to decide the appropriate sanction when such is disputed. Walker
v. South Carolina ABC Comm’n, 305 S.C. 209, 407 S.E. 2d 633 (1991). The
Administrative Law Judge, as fact-finder, must impose a penalty based on the
facts presented at the contested case hearing. To that end, an Administrative
Law Judge must consider relevant evidence presented in mitigation. Mitigation
is defined as a lessening to any extent, great or small. It may be anything
between the limits of complete remission on one hand and a denial of any relief
on the other. In a legal sense, it necessarily implies the exercise of the
judgment of the court as to what is proper under the facts of the particular
case. 58 C.J.S. Mitigation p. 834, 835 (1948).
As stipulated, Respondent
violated the provisions of Regulation 7-200.4 by permitting the purchase of
beer by an individual under the age of twenty-one (21). However, it is clear
that Respondent takes these violations very seriously. Respondent has a zero
tolerance policy on sales of alcohol to minors and any employee who commits a
violation of that policy is automatically terminated, as the clerk was in this
case. Furthermore, Respondent has implemented many preventative measures,
including extensive internal and outside training programs for its employees,
to prevent sales of alcohol to underage individuals. Respondent also utilizes
other devices, such as “We Card” calendars, to assist its employees in
verifying a customer’s age. Despite these measures, however, Respondent’s
employee still sold beer to a minor. Nevertheless, this sale clearly does not
represent Respondent’s philosophy concerning sales to minors. Therefore, I
find that the appropriate penalty in this case is a ninety (90) day suspension of
Respondent’s beer and wine permit and a five hundred ($500) fine.
ORDER
Based upon the
foregoing Findings of Fact and Conclusions of Law,
IT IS HEREBY
ORDERED that Respondent’s off-premises beer and wine permit be suspended
for ninety (90) days beginning July 7, 2005; and
IT IS FURTHER
ORDERED that Respondent must remit a fine in the amount of five hundred
dollars ($500) to the Department within thirty (30) days of the date of this
Order.
AND
IT IS SO ORDERED.
__________________________________
MARVIN F.
KITTRELL
Chief
Administrative Law Judge
June 30, 2005
Columbia, South Carolina |
