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.
2004), S.C. Code Ann. § 1-23-600(B) (Supp. 2004), and S.C. Code Ann. §§
1-23-310 et seq. (2005). Petitioner South Carolina Department of Revenue
(Department) contends that Respondent 130 Rutledge Ave., LLC, d/b/a Medical
Center Amoco (130 Rutledge), knowingly allowed an underage individual to
purchase beer from its convenience store at 130 Rutledge Avenue in Charleston,
South Carolina, in violation of 23 S.C. Code Ann. Regs. 7-200.4 (Supp. 2004).
For this third such violation in as many years, the Department seeks to suspend
130 Rutledge’s off-premises beer and wine permit for the location in question
for a period of forty-five days. In response, 130 Rutledge 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 March 20,
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 130 Rutledge’s violation is the imposition of a one
thousand dollar ($1000.00) fine upon 130 Rutledge.
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 ten 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 130 Rutledge.
Specifically,
the parties stipulated that on April 24, 2005, Albert Christie, an employee of
Respondent 130 Rutledge, allowed an eighteen-year-old Underage Cooperating
Individual (UCI) working with the South Carolina Law Enforcement Division
(SLED) to purchase beer at its location at 130 Rutledge Avenue, Charleston, South Carolina. Mr. Christie completed the sale of the beer to the UCI without
requesting identification. Beyond describing the incident, the parties further
stipulated that the sale of the beer constituted a knowing violation of South Carolina law and that the violation was 130 Rutledge’s third such violation within a
three-year period.
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.
130 Rutledge Ave., Inc. owns and operates the convenience store,
Medical Center Amoco, located at 130 Rutledge Avenue, Charleston, South Carolina.
2.
130 Rutledge has made good-faith efforts to prevent the sale of
alcoholic beverages to underage individuals. For example, 130 Rutledge sends
its employees to training sessions concerning the prevention of sales of
alcohol to underage persons known as the Training Intervention Program (TIPS). Bonnie
Arnold, the convenience store manager at Medical Center Amoco, is a certified
trainer for TIPS. Fourteen of 130 Rutledge’s eighteen employees are TIPS
trained. 130 Rutledge believes that the TIPS training program effectively
addresses its problem with sales to underage individuals.
3. 130
Rutledge has strengthened its efforts to prevent underage sales by implementing
its current policies and procedures regarding sales of alcoholic beverages.
These efforts include:
(1)
strict policies and procedures concerning checking the identification and
verifying the age of customers purchasing alcoholic beverages (e.g., under
company policy, cashiers must request proof of age from all customers
purchasing alcoholic beverages and any cashier caught not checking for such
identification is terminated);
(2)
technological safeguards against illegal alcohol sales (e.g., the company uses
a "legal age" cash register that requires the cashier to enter the
date of birth of the customer before completing a sale of alcohol and has
available to the cashier an ID scanner that calculates the age of the customer
for the cashier);
(3)
training programs regarding the prevention of underage sales (e.g., the company
trains new employees thoroughly regarding the laws and company policies
governing the sale of alcoholic beverages and reiterates that training frequently);
and,
(4)
methods of monitoring whether its employees are complying with the laws and
company policies related to the sale of alcoholic beverages (e.g., the company
operates a "secret shopper" program that checks its stores and the
company's managers review samples of the video surveillance of each cashier's
shift on a daily basis).
These efforts
are indicative of 130 Rutledge’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. 2004).
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. 2004). Respondent 130 Rutledge 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. 2004).
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. 2004); 23 S.C.
Code Ann. Regs. 7-200.4 (Supp. 2004); see also S.C. Code Ann. § 61-4-270
(Supp. 2004) (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. 2004). 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. 2004) within three years, the Department shall IMPOSE upon Respondent a fine of one thousand dollars ($1000.00).
AND
IT IS SO ORDERED.
__________________________________
March 24, 2006 JOHN
D. MCLEOD
Columbia, South Carolina Administrative
Law Judge
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