SC Administrative Law Court Decisions

STATEMENT OF THE CASE

This matter is before the Administrative Law Judge Division pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2000) on the application for an on-premises beer and wine permit and minibottle license for a nonprofit organization, the Broadway Club, to be located at 1807 Graham Road, Galivants Ferry, South Carolina. After notice to the parties, a hearing was conducted on October 4, 2001, at the Administrative Law Judge Division. Based upon the evidence presented regarding the suitability of the location and the nature of the Broadway Club, this tribunal finds that the property on which the club is to be located is suitable for a beer and wine permit and minibottle license, that the Broadway Club as an organization meets the requirements to hold the permit and license it requests, and that Petitioner shall be issued the aforementioned permit and license upon completion of the building to house the organization and upon securement of a retail sales tax license.

Having carefully considered all testimony, exhibits, and arguments presented at the hearing of this case, 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. On or about February 27, 2001, Petitioner, through its President, Joe Huffman, submitted an application for an on-premises beer and wine permit and a nonprofit private club minibottle license to the South Carolina Department of Revenue for the premises to be located at 1807 Graham Road, Galivants Ferry. Petitioner's application is incorporated into the record by reference.

2. Applicant Joe Huffman currently holds a beer and wine permit for a business which had been conducted in a dilapidated building at the proposed site since 1973. That building has since been demolished to make way for a new building which Mr. Huffman proposes to construct to conduct the activities of the nonprofit private club. The site in question was also previously surrounded by Mr. Huffman's salvage yard. He intends, however, to separate the salvage yard from the area designated for the private club. At present, the site has been cleared and the blueprints for the new building have been drafted and permitted for construction.

3. Applicant Joe Huffman has no criminal convictions and is a person of good moral character.

4. Applicant Huffman is a legal resident of the United States.

5. Applicant Huffman resided in and maintained his principal place of abode in South Carolina for more than thirty days before applying for a beer and wine permit and minibottle license.

6. Applicant Huffman has never had any permit to sell beer and wine or alcoholic liquors suspended or revoked.

7. Applicant Huffman is over twenty-one years of age.

8. Notice of the application for the beer and wine permit and minibottle license was published in The (Myrtle Beach, S.C.) Sun News on March 7, 24, and 31, 2001. Notice was also posted at the proposed location for the required time period.

9. Applicant Joe Huffman represents and Petitioner's bylaws indicate that the object and purpose of the private club shall be to operate solely and exclusively for the social and fraternal benefit of its members. Also, the club intends to support the Tower of Prayer Church and its cemetery.

10. The bylaws of the organization provide a definite, fixed method of electing persons to membership in the organization, and membership is not open to the general public. Petitioner's bylaws also provide for the election of a Board of Directors, who are responsible for the management of the private club. Currently, Joe Huffman, the applicant, serves as provisional president and his wife, Hannah Marks serves as secretary of the organization. Two other individuals, Joe Anthony Huffman and Ezzard Huffman, serve on the provisional Board. The Board has met on at least three occasions, as early as July 13, 2001.

11. Petitioner's bylaws also specify that the bona fide members of the club must pay dues as fixed by the Board of Directors, that no part of the earnings of the club will inure to the direct benefit of any member, and that the assets of the club will be distributed to charities upon the dissolution of the club.

12. Petitioner filed Articles of Incorporation as a Nonprofit Corporation with the Secretary of State of South Carolina on February 23, 2001, and is currently registered and in good standing with the Secretary of State.

13. The Department refused to issue the beer and wine permit and minibottle license, contending that Petitioner has not satisfied all statutory and regulatory criteria. Specifically, the Department asserted that the proposed location was dilapidated and unsuitable for use at the time the application was made; that the organization has been organized primarily to obtain a license to sell alcoholic beverages, and the sale of such is not incidental to the main purpose of the organization; that Petitioner has not demonstrated that it is managed by a Board of Directors; and that Petitioner does not have a retail sales tax license.

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

1. Jurisdiction is vested with the Administrative Law Judge Division pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2000), S.C. Code Ann. § 1-23-600(B) (Supp. 2000), and S.C. Code Ann. §§ 1-23-310 et seq. (1986 & Supp. 2000).

2. "[T]he issuance or granting of a license to sell beer or alcoholic beverages rests in the sound discretion of the body or official to whom the duty of issuing it is committed . . . ." Palmer v. S.C. ABC Comm'n, 282 S.C. 246, 248, 317 S.E.2d 476, 477 (Ct. App. 1984).

3. S.C. Code Ann. §§ 61-4-520 and 61-6-1820 (Supp. 2000), respectively, establish the general criteria for the issuance of a beer and wine permit and a minibottle license. Although the suitability of the proposed location is not listed in Section 61-6-1820 as a condition of licensing, such a consideration is proper. Schudel v. S.C. ABC Comm'n, 276 S.C. 138, 276 S.E.2d 308 (1981). Further, S.C. Code Ann. § 61-6-20(6) (Supp. 2000) defines "nonprofit organization" for the purposes of minibottle licensing and 23 S.C. Code Ann. Regs. 7-17 (1976 & Supp. 2000), entitled "Sale and Consumption at Nonprofit Organizations," sets forth the requirements which must be met by an applicant to obtain a minibottle license for a nonprofit organization.

4. Although "proper location" is not statutorily defined, broad discretion has been vested in the finder of fact in determining the fitness or suitability of a particular location. SeeFast Stops, Inc. v. Ingram, 276 S.C. 593, 281 S.E.2d 118 (1981). The determination of suitability of a location is not necessarily a function solely of geography. It involves an infinite variety of considerations related to the nature and operation of the proposed business and its impact on the community within which it is to be located. Kearney v. Allen, 287 S.C. 324, 338 S.E.2d 335 (1985); Schudel, 276 S.C. 138, 276 S.E.2d 308.

5. The trier of fact must weigh and pass upon the credibility of evidence presented. SeeS.C. Cable Television Ass'n v. Southern Bell Tel. and Tel. Co., 308 S.C. 216, 417 S.E.2d 586 (1992). The trial judge who observes a witness is in the best position to judge the witness's demeanor and veracity and evaluate his testimony. SeeMcAlister v. Patterson, 278 S.C. 481, 299 S.E.2d 322 (1982); Peay v. Peay, 260 S.C. 108, 194 S.E.2d 392 (1973); Mann v. Walker, 285 S.C. 194, 328 S.E.2d 659 (Ct. App. 1985); Marshall v. Marshall, 282 S.C. 534, 320 S.E.2d 44 (Ct. App. 1984).

6. The proposed location for the Broadway Club is a suitable location for a nonprofit private club with a beer and wine permit and a minibottle license. The old, dilapidated structure has been torn down, and a new building is to be built in its place. The activities of the salvage yard have been relocated to another portion of applicant Huffman's property, separate from the proposed site of the club. Further, the activities of the nonprofit private club at the proposed location will not adversely affect the surrounding community.

7. The Broadway Club as an organization comports the with applicable statutory and regulatory requirements that a nonprofit organization must satisfy in order to obtain a minibottle license. In particular, the sale of alcoholic beverages by the club is incidental to the main purpose of the organization, ⁽¹⁾ and the affairs and management of the club are conducted by a board of directors.

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

IT IS HEREBY ORDERED that the Department shall issue to Petitioner an on-premises beer and wine permit and minibottle license for the aforementioned location at such time as the construction of the club's building is completed and it has secured a retail sales tax license.

AND IT IS SO ORDERED.
 

______________________________

JOHN D. GEATHERS

Administrative Law Judge

Post Office Box 11667

Columbia, South Carolina 29211-1667
 

October 29, 2001

Columbia, South Carolina

1. That is, the consumption of alcohol at the Broadway Club is not any more or less "incidental" to the primary purpose of the club than the consumption of alcohol is to other nonprofit, private clubs that the courts routinely authorize to hold liquor licenses. See, e.g., Dep't of Fin. and Admin. v. Samuhel, 909 S.W.2d 656 (Ark. Ct. App. 1995) (upholding agency decision to issue a liquor license to a nonprofit, private club under statutory requirements similar to South Carolina's where the primary purpose of the organization was to establish a supper club for its members, where excess revenues would go to building tennis courts and a swimming pool before going to local charities, and where evidence was presented that the club was established so that residents of a "dry" county who could not become members of the local VFW club or local country clubs could have a place to consume alcohol).