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SC Administrative Law Court Decisions

Earth Petroleum Corporation, d/b/a EPCO vs. SCDOR, et al

South Carolina Department of Revenue

Earth Petroleum Corporation, d/b/a EPCO
1000 E. Liberty Street, Marion, SC

South Carolina Department of Revenue and Bobby Gerald and Willie L. Smith

For the Petitioner: Kenneth E. Allen, Esquire

For the Department: Excused

For Respondents Bobby Gerald and Willie L. Smith: Danny C. Crowe, Esquire

For the Protestants: Pro Se




This matter comes before the Administrative Law Judge Division pursuant to S.C. Code Ann. § 61-2-90 (Supp. 2000) and S.C. Code Ann. §§ 1-23-310 et seq. (1986 & Supp. 2000) for a contested case hearing. The Petitioner, Earth Petroleum Corporation, d/b/a EPCO, seeks an off-premise beer and wine permit. Respondent South Carolina Department of Revenue filed a Motion to be Excused setting forth that but for the protests of the Protestants, this permit would have been issued. This motion was granted by my Order dated January 22, 2002. Prior to the hearing into this matter, Protestants Mayor Bobby Gerald and Police Chief Willie L. Smith filed Motions to Intervene as parties. These motions were granted at the hearing and the caption was amended to reflect their addition as Respondents. A hearing was held before me on March 19, 2002, 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 proof upon the parties, I make the following Findings of Fact by a preponderance of the evidence:

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

2. The Petitioner seeks an off-premise beer and wine permit for Earth Petroleum Corporation, d/b/a EPCO, located at 1000 E. Liberty Street, Marion, South Carolina.

3. The Petitioner has not had a permit or license revoked within the last two years and notice of the application was lawfully posted both at the location and in a newspaper of general circulation. The Petitioner meets the qualifications set forth in S.C. Code Ann. § 61-4-520 (Supp. 2000), except that the qualifications set forth in Section 61-4-520 concerning the residency of the Petitioner are not properly established.

4. The Respondents and Protestants contend that the location is unsuitable because:

a. The proposed location is too close to a city recreational facility;

b. The proposed location is too close to a school;

c. The proposed location would create a traffic hazard for motorists and pedestrians; and

d. The proposed location would exacerbate the existing problems with loitering and public drinking in the area.

5. The proposed location is under construction as a convenience store. This store is situated in an area that is both commercial and residential. The City of Marion maintains a recreational center adjacent to the proposed location. The recreational center consists of a walking track, a recreation building, a pool, and a basketball court. The walking track is fifty-eight (58) feet from the corner of the Petitioner's convenience store building. The lighted track is frequently used by local residents at all hours of the day and particularly by elderly female residents. The elderly female residents often walk by themselves or in pairs. The City of Marion has experienced problems with public drinking in the area of the walking track and, to a limited extent, individuals intimidating elderly walkers. Additionally, because of its proximity to a housing project, the track and recreation field are sometimes used as a "hangout" for individuals not utilizing the recreational center. Nevertheless, because of the openness of the trail and field, those problems have been minimized.

6. The proposed location is situated at the heavily congested corner of Liberty Street and Gurley Street. Liberty Street is a major thoroughfare in Marion while Gurley Street is also heavily traveled during the school year. During the weekdays while public schools are in session, approximately 3,000 cars travel Gurley Street and approximately 8,000 cars travel in just the lane of traffic adjacent to the proposed location on Liberty Street alone. The intersection of Liberty and Gurley Streets is approximately 2/10ths of a mile from Johnakin Middle School. Johnakin has approximately 800 students, grades six to eight. Many of those students walk directly by the location on the sidewalks of Liberty and Gurley Streets. Additionally, many of the students use the recreational center after school and during the summer months.

7. The City of Marion has experienced problems with individuals congregating at off-premise locations and transferring beer to minors at those locations.

8. In order to deny this permit, direct evidence of an adverse impact on the community is necessary. Here, the proposed location will add further traffic congestion in an area where many children are walking to and from school. Moreover, adding the proposed location in an area where numerous children "hang out" after school and where there is an existing problem with the public consumption of alcohol are other considerations operating against the Petitioner receiving a permit. Furthermore, the owner of the business is not a resident of South Carolina and, as a result, may not be at the proposed location to deal with the potential problems arising from the operation of a store at this location. Therefore, even though Mr. Patel has faithfully operated a similar store in the past and appears to be a sincere businessman, I find that the Petitioner's proposed location is not suitable for an off-premise beer and wine permit.


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. 2000) grants jurisdiction to the Administrative Law Judge Division to hear contested cases under the Administrative Procedures Act. Furthermore, S.C. Code Ann. § 61-2-260 (Supp. 2000) grants the Division the responsibilities to determine contested matters governing alcoholic beverages, beer and wine.

2. S.C. Code Ann. §§ 61-4-520 and 61-4-540 (Supp. 2000) set forth the requirements for the issuance of a beer and wine permit.

3. Although "proper location" is not statutorily defined, the Administrative Law Judge Division is vested, as the trier of fact, with the authority to determine the fitness or suitability of a particular location. Fast Stops, Inc. v. Ingram, 276 S.C. 593, 281 S.E. 2d 181 (1981). The determination of suitability of location is not necessarily a function solely of geography. It involves an infinite variety of considerations related to the nature and operations of the proposed business and its impact upon the community within which it is to be located. Kearney v. Allen, 287 S.C. 324, 338 S.E. 2d 335 (1985). In determining the suitability of a location, it is proper for this Court to consider any evidence that demonstrates the adverse effect the proposed location will have on the community. Palmer v. S.C. ABC Comm'n, 282 S.C. 246, 317 S.E. 2d 476 (Ct. App. 1984). In particular, S.C. Code Ann. § 61-4-520(7) (Supp. 2000) provides that the proximity of a proposed location to a school or playground is an adequate basis to deny a beer and wine permit. See also Kearney, supra; Schudel v. S.C. A.B.C. Commission, 276 S.C. 138, 276 S.E. 2d 308 (1981).

4. A beer and wine permit is neither a contract nor a property right. It is, rather, a privilege granted in the exercise of the State's police power "to do what otherwise would be unlawful to do. . . ." Feldman v. South Carolina Tax Comm'n, 203 S.C. 49, 26 S.E. 2d 22 (1943). Furthermore, "[a] liquor license or permit may properly be refused on the ground that the location of the establishment would adversely affect the public interest, that the nature of the neighborhood and of the premises is such that the establishment would be detrimental to the welfare . . . of the inhabitants, or that the manner of conducting the establishment would not be conducive to the general welfare of the community." 48 C.J.S. Intoxicating Liquors § 121 at 501 (1981).

5. S.C. Code Ann. § 61-4-520(2) (Supp. 2000) provides that a permit authorizing the sale of beer or wine may not be issued unless "the retail applicant is a legal resident of the United States, has been a legal resident of this State for at least thirty days before the date of application, and has maintained his principal place of abode in the State for at least thirty days before the date of application." However, in this case, the owner of the proposed location was and is a legal resident of North Carolina. (1) The Petitioner contends that the permit may be held in the name of the corporation and, therefore, that the Applicant need not be a resident of this State. S.C. Code Ann. § 61-2-100(A) (Supp. 2000) provides that "[t]he department may issue licenses and permits authorized under this title to qualifying persons." A "person" is defined in Section 61-2-100(H)(1) as including a corporation.

In construing statutory language, the statute must be read as a whole, and sections which are part of the same general statutory law must be construed together and each one given effect. TNS Mills, Inc. v. S.C. Dept. of Revenue, 331 S.C. 611, 503 S.E.2d 471 (1998). The Petitioner's interpretation of the statutes does not seek to reconcile Sections 61-4-520(2) and 61-2-100(A), but rather assumes that if an individual incorporates a business in South Carolina, there is no requirement of residency. Construing the relevant statutes together, I find that though a corporation may hold a permit in South Carolina, the principals of the corporation are required to meet the requisites of an "applicant" under Section 61-4-520(2). Furthermore, a statute should not be interpreted in a way which would lead to a result so absurd that it would defeat the plain intent of the legislature. Gentry v. Yonce, 337 S.C. 1, 522 S.E.2d 137 (1999). The law is clear that, in the case of a publicly held corporation, the permit must be held on behalf of the corporation by "an officer or other employee of good moral character, over the age of twenty-one and a resident of this State." S.C. Code Ann. § 61-2-100(H)(2)(i) (Supp. 2000) (emphasis added). (2) The Petitioner's reading of the statutes would lead to an absurd result - that a publicly held corporation must have a resident of the State hold the permit on behalf of the corporation, but that an individual residing out of State could simply incorporate a business in South Carolina and thereby circumvent the residency requirement. This result would contravene the clearly expressed legislative intent in Section 61-4-520(2) that a permit holder must be a resident of South Carolina. Finally, in construing a statute, that which is fairly implied is as effective as if expressed. Gaffney v. Mallory, 186 S.C. 337, 195 S.E. 840 (1938). S.C. Code Ann. § 61-2-100(C) provides that "[i]f application is made for a license or permit under this title by a person other than an individual, all principals are deemed to be the applicant under Section 61-2-160." That statute, if not directly, at least inferentially supports the interpretation that all the principals of a non-publicly held corporation in South Carolina must be residents of the State of South Carolina.


Based upon the above Findings of Fact and Conclusions of Law, it is hereby:

ORDERED that the off-premise beer and wine permit application of Earth Petroleum Corporation, d/b/a EPCO be denied.



Ralph King Anderson III

Administrative Law Judge

April 3, 2002

Columbia, South Carolina

1. Mr. Patel testified that he owns EPCO with his wife. Clearly, Mr. Patel, a principal of the corporation, was not a South Carolina resident. See S.C. Code Ann. § 61-2-100(H)(2) (Supp. 2000). Moreover, no evidence was offered concerning the qualifications of Mr. Patel's wife.

2. Here, the evidence clearly inferred that Earth Petroleum Corporation is not publicly held.

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