SC Administrative Law Court Decisions

1. Notice of the time, date, place and subject matter of the Hearing was given to the Petitioner and the Respondent.

2. The Respondent, Walter Gibson, holds an on-premise beer and wine permit for Toni’s Restaurant at 614 Kaminski Street in Georgetown, South Carolina.

3. SLED along with the Georgetown Police conducted a compliance check of Respondent’s location on the night of November 12 and early morning of November 13, 2005. Shawana White and Billy White, Jr., had been placed in charge of running the business that night by Walter Gibson’s manager. When the agents arrived at Toni’s Restaurant they observed a flier advertising the grand opening of “S & B Lounge a/k/a Toni’s Place” at 614 Kaminski Street. The flier was taped to the front door and indicated that there would be a five dollar ($5.00) cover charge and “free drinks while they last”. The same flier was also posted on a podium at the entrance along with a cash box.

4. On the night of the above inspection, there were also four (4) bottles of liquor[1] on the food counter.

5. After Ms. White contacted the Respondent, he arrived at the business approximately one and a half (1 ½) hours later. Two violation reports were later issued to Walter Gibson; permitting a criminal act and unlawful possession of liquor, and violation of happy hour laws by advertising for free alcohol.

CONCLUSIONS OF LAW

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

1. S.C. Code Ann. § 61-2-260 (Supp. 1998) grants the Administrative Law Judge Division the responsibilities to determine contested matters governing alcoholic beverage, beer and wine permits.

2. S.C. Code Ann.§ 61‑4‑160 (Supp. 2003) provides that:

No person who holds a biennial permit to sell beer or wine for on-premises consumption may advertise, sell, or dispense these beverages for free, at a price less than one-half of the price regularly charged, or on a two or more for the price of one basis. Beer or wine may be sold at a price less than the price regularly charged from four o'clock p.m. until eight o'clock p.m. only. The prohibition against dispensing the beverages for free does not apply to dispensing to a customer on an individual basis, to a fraternal organization in the course of its fund-raising activities, to a person attending a private function on premises for which a biennial permit has been issued, or to a customer attending a function sponsored by the person who holds a biennial permit.

3. S.C. Code Ann. § 61-4-580(6) (Supp. 2003) prohibits a permittee licensed to sell beer and wine from selling, offering to sell or even possessing alcoholic liquors on the licensed premises.

4. 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 ALC, being the tribunal authorized to grant the issuance of a license, is likewise authorized to revoke or suspend the license for cause. See Feldman v. S.C. Tax Commission, 203 S.C. 49, 26 S.E.2d 22 (1943).

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. Where the General Assembly authorizes a range of alternatives for an administratively imposed penalty, the administrative fact-finder may set the amount of the penalty after a hearing on the dispute. Walker v. South Carolina ABC Comm'n, 305 S.C. 209, 407 S.E.2d 633 (1991). Here, the Department, and therefore the ALC, has jurisdiction to “revoke or suspend permits authorizing the sale of beer or wine.” S.C. Code Ann. § 61-4-590 (Supp. 2005). Furthermore, for violations of S.C. Code Ann. §§ 61-4-160 and 61-4-580(6), the Department, and therefore the ALC, may impose a monetary penalty upon the holder of a beer or wine permit in lieu of a suspension or revocation. S.C. Code Ann.§ 61-4-250 (Supp. 2005). The fine may range from twenty-five dollars to one thousand dollars for retail beer and wine licensees. Id.

7. The Respondent clearly violated the above provisions. Other than his attempt to blame his employees he offered no expectable evidence in mitigation. South Carolina Department of Revenue Procedure 04-4 suggests a penalty in the amount of $500 for a licensee's first violation of the Alcohol Beverage Licensing Statutes. I find those guidelines appropriate in this case and therefore find that a $500 penalty should be imposed for each offense.

ORDER

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

IT IS HEREBY ORDERED that the Respondent pay a monetary penalty of $1,000.00 to the South Carolina Department of Revenue within thirty (30) days from the date of this Order.

______________________________

Ralph King Anderson, III

Administrative Law Judge

February 28, 2006

Columbia, South Carolina