ORDERS:
FINAL ORDER AND DECISION
STATEMENT
OF THE CASE
This
matter comes before this Court pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2005),
S.C. Code Ann. § 1-23-600(B) (Supp. 2005), and S.C. Code Ann. §§ 1-23-310 et
seq. (2005). Petitioner South Carolina Department of Revenue (Department)
contends that Respondent City Marina Company (City Marina) knowingly allowed an
underage individual to purchase beer from its BP-Amoco convenience store at 17
Lockwood Drive in Charleston, South Carolina, in violation of 23 S.C. Code Ann.
Regs. 7-200.4 (Supp. 2005). For this third such violation in as many years,
the Department seeks to suspend City Marina’s off-premises beer and wine permit
for the location in question for a period of forty-five days. In response, City
Marina concedes that the alleged violation did occur, but further contends that
the proposed penalty for the violation is excessive in light of its efforts to
prevent such sales.
After
timely notice to the parties, a hearing of this matter was held on January 5,
2006, at the South Carolina Administrative Law Court in Columbia, South
Carolina. Based upon the testimony and exhibits presented at the hearing, I
find that the appropriate penalty for City Marina’s violation is a twenty-one-day
suspension of City Marina’s beer and wine permit and the imposition of a $1000
fine upon City Marina.
STIPULATED
FACTS
Pursuant
to ALC Rule 25(C) and Rule 43(k), SCRCP, the parties submitted a Stipulation of
Facts to the Court at the hearing of this matter. The Stipulation was marked
as Petitioner’s Exhibit #1 and is hereby incorporated into this Order by
reference. In the eleven items of the stipulation, the parties describe the
circumstances giving rise to the violation in question and acknowledge both the
current and prior violations committed by City Marina.
Specifically,
the parties stipulated that, at approximately 9:40 p.m. on Monday, April 11,
2005, Dorothy Doctor, an employee of Respondent City Marina, sold a twenty-two-ounce
Budweiser beer to an eighteen-year-old Underage Cooperating Individual (UCI)
working with the Charleston Police Department. The parties further stipulated
that Ms. Doctor did not ask the UCI for identification or otherwise inquire as
to his age before completing the sale of the beer. Beyond describing the
incident, the parties also agreed that the sale of the beer constituted a
knowing violation of South Carolina law and that the violation was City
Marina’s third such violation within a three-year period, with prior violations
for the sale of beer to an underage person occurring on November 6, 2003, and
January 27, 2005. The parties also acknowledged that, in a prior contested
case regarding the January 27, 2005 violation, City Marina’s permit had been
suspended for twenty-one days and it had been fined $800. See S.C.
Dep’t of Revenue v. The City Marina Co., Docket No. 05-ALJ-17-0172-CC (S.C.
Admin. Law Ct. Oct. 17, 2005).
FINDINGS
OF FACT
Having
carefully considered all testimony, exhibits, and arguments presented at the
hearing of this matter, 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. City
Marina Company owns and operates two marinas and two accompanying convenience
stores in the Charleston area, including the store located at 17 Lockwood
Drive.
2. City
Marina has made good-faith efforts to prevent the sale of alcoholic beverages
to underage individuals. These efforts include both (1) the institution of company
policies, such as a policy requiring cashiers to request proof of age from all
customers purchasing alcoholic beverages, regardless of their appearances, and a
policy requiring the termination of any cashier that fails to check for such
identification, regardless of whether the sale leads to a violation, and (2)
the adoption of company practices, such as the use of an in-house “secret
shopper” program to determine whether its cashiers are checking for proof of
age on sales of alcoholic beverages and the adoption of a comprehensive
employee training program regarding sales of alcoholic beverages that includes
training under the nationally-recognized TIPS program. In fact, the manger of
City Marina’s convenience stores has become a certified TIPS trainer.
While
most of these policies and procedures were only implemented after City Marina’s
January 2005 violation, these efforts are indicative of City Marina’s
commitment to prevent the sale of alcoholic beverages to underage individuals
and are relevant for determining the appropriate penalty to be imposed in this
matter.
CONCLUSIONS
OF LAW
Based
upon the foregoing Stipulated Facts and Findings of Fact, I conclude the
following as a matter of law:
1. The
Department is charged with the responsibility of administering and enforcing
the laws and regulations governing alcoholic beverages, including beer and
wine. S.C. Code Ann. § 61-2-20 (Supp. 2005).
2. Regulation
7-200.4 prohibits holders of beer and wine permits from selling beer or wine to
persons under twenty-one years of age. The regulation provides that:
To
permit or knowingly allow a person under twenty-one years of age to purchase or
possess or consume beer or wine in or on a licensed establishment which holds a
license or permit issued by the Department is prohibited and constitutes a
violation against the license or permit. Such violation shall be sufficient
cause to suspend or revoke the license or permit by the Department.
23 S.C. Code
Ann. Regs. 7-200.4 (Supp. 2005). Respondent City Marina concedes and
stipulates that it committed a violation of Regulation 7-200.4 as alleged by
the Department.
3. The
Department has jurisdiction to revoke or suspend permits authorizing the sale
of beer and wine. S.C. Code Ann. § 61-4-590 (Supp. 2005). Pursuant to such
authority, the Department may suspend or revoke a beer and wine permit if the
permittee has knowingly sold beer or wine to a person under twenty-one years of
age. S.C. Code Ann. § 61-4-580(1) (Supp. 2005); 23 S.C. Code Ann. Regs.
7-200.4 (Supp. 2005); see also S.C. Code Ann. § 61-4-270 (Supp. 2005)
(authorizing the Department to “revoke the permit of a person failing to comply
with any requirements” in Chapter 4 of Title 61). Further, the Department may
exercise this authority to suspend or revoke a permit for a first violation of
the prohibition against selling beer and wine to minors. See S.C. Code
Ann. §§ 61-4-270, 61-4-580, 61-4-590; 23 S.C. Code Ann. Regs. 7-200.4. In lieu
of such suspension or revocation, the Department may also impose a monetary
penalty upon a permittee for selling beer and wine to minors. S.C. Code Ann. §
61-4-250 (Supp. 2005). For retail beer and wine permittees, this monetary
penalty must be no less than $25 and no greater than $1,000. Id.
4. S.C.
Revenue Procedure 95-7 (1995) sets forth the Department’s penalty guidelines
for violations of the alcoholic beverage control laws. For retail beer and
wine permits, Revenue Procedure 95-7 provides for a $400 fine for the first
violation by a permittee, an $800 fine for the second violation, a 45-day
suspension of the permit for the third violation, and revocation of the permit
for the fourth violation. However, this document does not set binding norms
for the Department, but rather only provides guidance to the Department in
assessing penalties for violations of the alcoholic beverage control laws. See Revenue Procedure 95-7, at ¶ 4 (“These are guidelines only and this advisory
opinion does not establish a binding norm.”). As such, Revenue Procedure 95-7
is not law and thus is not binding upon this Court. Cf. Home Health
Serv., Inc. v. S.C. Tax Comm’n, 312 S.C. 324, 328, 440 S.E.2d 375, 378
(1994) (holding that “whether a particular agency proceeding announces a rule
or a general policy statement depends upon whether the agency action
establishes a binding norm”) (citing Ryder Truck Lines, Inc. v. United
States, 716 F.2d 1369 (11th Cir. 1983)).
5. 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
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, 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).
6.
The facts in this case warrant a lesser penalty than that sought to be imposed
by the Department. It is a generally recognized principle of administrative
law that the fact finder has the authority to determine an appropriate
administrative penalty, within the statutory limits established by the
legislature, after the parties have had an opportunity for a hearing on the
issues. See, e.g., Walker v. S.C. Alcoholic Beverage Control Comm’n,
305 S.C. 209, 407 S.E.2d 633 (1991). Further, in assessing a penalty, the
finder of fact “should give effect to the major purpose of a civil
penalty–deterrence.” Midlands Utility, Inc. v. S.C. Dep’t of Health &
Envtl. Control, 313 S.C. 210, 212, 437 S.E.2d 120, 121 (Ct. App. 1993).
7. However,
Respondent should be reminded that the purpose of the statutory prohibition
against selling alcohol to underage individuals is to protect both the underage
individuals and the public at large from the possible adverse consequences of
such sales. The sale of alcohol to an underage individual is a serious offense
and cannot be taken lightly. Further, it should be noted that a permit to sell
beer and wine is neither a contract nor a property right. Rather, it is merely
a permit to do what otherwise would be unlawful to do, and to be enjoyed only
so long as the restrictions and conditions governing its continuance are
complied with. Feldman v. S.C. Tax Comm’n, 203 S.C. 49, 26 S.E.2d 22
(1943). Accordingly, beyond satisfying the penalty imposed in this matter,
Respondent is advised to make every effort to prevent such sales in the future,
as the failure to do so may subject it to more severe penalties in the event of
a future violation.
ORDER
Based
upon the Stipulated Facts, Findings of Fact, and Conclusions of Law stated
above,
IT
IS HEREBY ORDERED that, for Respondent’s third violation of 23 S.C. Code
Ann. Regs. 7-200.4 (Supp. 2005) within three years, the Department shall SUSPEND Respondent’s off-premises beer and wine permit for its BP-Amoco store at 17
Lockwood Drive for twenty-one (21) days and shall IMPOSE upon Respondent
a fine of one thousand dollars ($1000.00).
AND
IT IS SO ORDERED.
______________________________
JOHN D.
GEATHERS
Administrative
Law Judge
1205 Pendleton
Street, Suite 224
Columbia, South
Carolina 29201-3731
February 21, 2006
Columbia, South Carolina |
