SC Administrative Law Court Decisions

This matter comes before me upon request for a hearing by the Respondent after being cited for an administrative violation against his beer and wine permit. The South Carolina Department of Revenue (Department) seeks to levy a fine against the Respondent in the amount of Eight Hundred ($800.00) Dollars for violating the Alcoholic Beverage Control Act. A hearing was held before me on June 15, 2000 at the offices of the Administrative Law Judge Division (Division) in Columbia, South Carolina.

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 evidence:

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

2. United Oil Marketers of South Carolina, Inc., holds off-premises beer and wine permit No. BG164384 for United Oil Marketers 152. The store is located at 6058 Newberry Road, Winnsboro, South Carolina.

3. On December 20, 1999, an underage cooperating individual (UCI) entered United Oil Marketers 152. The UCI carried only his identification and money into the store. While inside the store, the UCI purchased a twelve ounce can of Budweiser beer from Bernice Coleman, the clerk on duty. Ms. Coleman asked the UCI if he was old enough to buy beer. The UCI responded by producing his driver's license, which Ms. Coleman inspected. Nonetheless, Ms. Coleman sold the Budweiser to the UCI. At the time of this incident, the UCI was eighteen years of age and his license indicated this age.

4. It is the company's policy to check the identification of its customers who purchase beer, wine and tobacco products at all of its locations. In fact, signs were posted declaring its no-sale-to-minors policy at the cash registers of United Oil Marketers 152. Ms. Coleman was fired as a result of this violation.

5. The Respondent violated the provisions of 23 S.C. Code Ann. Regs. § 7-9 (B) (Supp. 1998) by permitting the purchase of beer by an individual under the age of twenty-one. Furthermore, this is the Respondent's second violation within the past three years at this location.

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

1. S.C. Code Ann. § 1-23-600 (Supp. 1998) grants jurisdiction to the Division to hear contested cases under the Administrative Procedures Act. Specifically, S.C. Code Ann. § 61-2-260 (Supp. 1998) grants the Division 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. 1998).

4. Permitting or knowingly allowing a person under the age of twenty-one 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. 7-9(B) (Supp. 1998).

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

principal, 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 (S.C. 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. S.C. Code Ann. § 61-4-250(1) (Supp. 1998) authorizes the imposition of a monetary penalty of not less than Twenty-five ($25.00) Dollars and not more than One Thousand ($1,000.00) Dollars. Because this is the Respondent's second violation of S.C. Code Ann. Regs. 7-9(B) (Supp. 1998) within the past three years, the Department is seeking a penalty of Eight Hundred ($800.00) Dollars. ⁽¹⁾ See Revenue Procedure 95-7.

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, the 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).

In this case, the Respondent clearly violated the provisions of 23 S.C. Code Ann. Regs. 7-9 (B) (Supp. 1998) by permitting the purchase of beer by an individual under the age of twenty-one. Furthermore, this is the Respondent's second violation in the past three years. Therefore, I find that the imposition of a monetary penalty is proper. Furthermore, even though the Respondent had instructed its employees concerning the sale of beer to minors, had signs declaring its no-sale-to-minors policy posted at its cash registers, and fired Ms. Coleman as a result of this violation, the fact remains that Ms. Coleman looked at the UCI's license and still sold him beer. Consequently, I find that the mitigating factors presented at the hearing do not warrant a significant reduction in the fine sought by the Department. Also, I caution the Respondent that future violations within the next two years (from the December 20 anniversary date) will only result in higher fines and/or license revocation.

ORDER

Based upon the foregoing Findings of Fact and Conclusions of Law, IT IS HEREBY ORDERED that a penalty of Seven Hundred Fifty (750.00) Dollars is imposed against the Respondent.

AND IT IS SO ORDERED.

___________________________

Ralph King Anderson, III

Administrative Law Judge

November 15, 2000

Columbia, South Carolina

1. At the hearing, the Department provided evidence of the Respondent's prior violation which occurred on June 21, 1998.