South Carolina              
Administrative Law Court
Edgar A. Brown building 1205 Pendleton St., Suite 224 Columbia, SC 29201 Voice: (803) 734-0550

SC Administrative Law Court Decisions

CAPTION:
American Legion Post 178 vs. SCDOR

AGENCY:
South Carolina Department of Revenue

PARTIES:
Petitioners:
American Legion Post 178
11980 Highway 17 Bypass, Murrells Inlet, S.C.

Respondents:
South Carolina Department of Revenue
 
DOCKET NUMBER:
02-ALJ-17-0138-CC

APPEARANCES:
For the Petitioner: Kenneth E. Allen, Esquire and James H. Harrison, Esquire

For the Respondent: Nicholas P. Sipe, Esquire

For the Protestants: William C. Fletcher, Jr.
 

ORDERS:

FINAL ORDER AND DECISION

STATEMENT OF THE CASE

This matter is before the Administrative Law Judge Division ("Division") pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2001) and S.C. Code Ann. § 1-23-310 et seq. (1986 & Supp. 2001). American Legion Post 178 ("Petitioner") initially filed an application for a temporary on-premise beer and wine permit and a temporary sale and consumption license ("mini-bottle license") for the premises known as "SBB Burnout Saloon," which is located at 11980 Highway 17 Bypass, Murrells Inlet, South Carolina ("proposed location"). The Petitioner later withdrew its request for a temporary mini-bottle license. The Petitioner, however, continues to seek a temporary beer and wine permit effective May 9, 2002 through May 20, 2002, for the 62nd Annual Harley-Davidson Spring Rally.

Formal protests were filed by Pamela Hobeika, Wayne Morley, Faye Morley, Frances Sullivan, Dolores Sauer, John Walker, Patricia Walker, R. H. Daly, James Taylor, David Trimmer, Connie Miller, Cliff Obermeyer, Carletta Obermeyer, Matt Thomson, Grace Thomson, Beth Eakins, Tammy Mollohan, Bryce Holsinger, Jasmine Holsinger, Albert Sauer, Ross Lawson, Robert Masters, Joseph Worthington, Robert Hall, Donna Hall, Walter Harkins, Margaret Harkins, Candy Threlkel, Brown Phillips, James Stultz, Edward Lazarz, Jr., Vera Faw, David Threlkel, Louvie Threlkel, Kevin Niedt, Denise Niedt, John Jardel, Rose Jardel, Andrew Lawson, Alice Lawson, Raymond Harbin, Julie Harbin, Alan Conklin, Susan Conklin, Richard Martin, Sandra Martin, Sal DeVita, John Dudley, Caryn Tirsch, Ann Miraglia, Harry Hill, Margie Hill, Robert LaCovey, Daisy LaCovey, Isabella Cerny, Alexandra Farraday, Joseph O'Brien, and Tracy O'Brien, all of whom live in residential communities near the proposed location.

On April 4, 2002, the Department transmitted the case to the Division. Because the Petitioner applied for a temporary permit with an effective date beginning May 9, 2002, the undersigned granted the Petitioner's request for an expedited hearing. After notice to all parties and the Protestants, the undersigned judge held a contested case hearing on Monday, April 22, 2002, at the offices of the Division in Columbia, South Carolina.

At the beginning of the hearing, the undersigned addressed the Motions to Intervene filed by James Stultz, Connie Miller, William Fletcher, Jr., Pamela Hobeika, and Bonnie DeZwart. The undersigned asked those Protestants who filed the Motions to Intervene to delegate one person to intervene on behalf of all Protestants. Based on the Protestants' decision, the undersigned granted Fletcher's motion and denied all other motions to intervene.

During the hearing, Scott Joye, Esquire, James Mills a/k/a Jimmy Motley, Jr., and John Marnell testified on behalf of the Petitioner. The Department called Steve Jackson to testify. Of thirty-nine residents who attended the hearing, Bonnie DeZwart, James Stultz, William Fletcher, Jr., Connie Miller, and Robert LaCovey testified on behalf of the Protestants.

At the conclusion of the Petitioner's case, the Department made a motion that the application be denied based on the fact that American Legion Post 178 clearly was not the real applicant. The Department also argued that American Legion Post 178 did not present any evidence regarding the application. The undersigned denied the motion, finding sufficient evidence had been presented by the Petitioner to continue the hearing.

During the Protestants' case, the Protestants filed a Motion for Immediate Denial of the Petitioner's Application for a Temporary Beer and Wine License. The Protestants argued that the application should be denied because:

(1) The Petitioner failed to comply with the notice requirements in that (a) the Petitioner did not give notice of its application by advertising in the Sun News, Myrtle Beach Garden City, or Myrtle Beach Herald newspapers; (b) the Petitioner did not file an Affidavit of Publication with its application; and (c) the Petitioner failed to post a sign for fifteen days at the proposed site to notify interested persons about the application;

(2) the Petitioner is attempting to transfer the beer and wine permit to SBB Four Corners, LLC in violation of S.C. Code Ann. § 61-6-4280 (Supp. 2001);

(3) the contract between the Petitioner and SBB LLC violates S.C. Code Ann. Regs. 7-17(A) in that SBB LLC is not a non-profit organization and therefore cannot assume the Petitioner's responsibility for the beer and wine permit;

(4) the Petitioner, as a nonprofit organization, cannot sublease the beer and wine permit to SBB LLC so that SBB LLC can receive the profit from the sale of beer and wine;

(5) pursuant to S.C. Code Ann. Regs. 7-48 and 7-76, the Petitioner cannot assign its responsibility for all violations occurring on the licensed premises;

(6) the Petitioner has applied for a beer and wine permit for a location where motorcycles and clothing apparel will be sold which would violate S.C. Code Ann. Regs. 7-6(B);

(7) the Petitioner concealed the fact that it intended to sublease the beer and wine permit to SBB LLC and therefore the permit should be denied pursuant to S.C. Code Ann. § 61-4-540 (Supp. 2001);

(8) SBB LLC has violated S.C. Code Ann. § 61-4-580(4) & (5) (Supp. 2001) as evidenced by the pictures printed from the "Suck Bang Blow" website (attached to the motion); and

(9) if the contract signed by the Petitioner and SBB LLC is different from the unsigned contract attached to the motion, which was voted upon by the Petitioner's membership on April 13, 2002, then the signed contract is null and void.

The undersigned gave the Petitioner until 5:00 on Wednesday to respond to the motion. The Petitioner filed a response on April 23, 2002.

The Petitioner first argues that a temporary beer and wine permit issued pursuant to S.C. Code Ann. § 61-4-550 does not require compliance with the notification requirements of § 61-4-520(8) & (9). As support for the argument, the Petitioner submitted Form ABL-900, the Department's instruction sheet for the temporary beer and wine permit application. Based on Form ABL-900, the Department does not require that notice of application be given by advertising in a local newspaper or by posting a notice for fifteen days at the proposed location. Furthermore, permits issued for fairs and special functions pursuant to § 61-4-550 contemplate the temporary nature of the location where beer and wine will be sold, i.e., a beer truck at a music festival or a booth at a fair. Because these locations are temporary in nature, neither the Department nor the legislature would expect these locations to post a 15-day notice prior to obtaining a temporary beer and wine permit. The statute regarding temporary beer and wine permits would apply equally to all locations, whether the location's structure is permanent or not. As a result, I conclude the Protestants' argument lacks merit.

The Petitioner next argues that Reg. 7-17(A) only applies to a mini-bottle license and, therefore, does not apply to a temporary beer and wine permit. I conclude this regulation in fact does not apply to a beer and wine permit and, therefore, does not apply to the facts of this case.

The Petitioner next argues that Reg. 7-6(B) only applies to a mini-bottle license and, therefore, does not apply to a temporary beer and wine permit. I conclude this regulation in fact does not apply to a beer and wine permit and, therefore, does not apply to the facts of this case.

The Petitioner also asserts that the record does not reflect any violations of § 61-4-580. The Protestants apparently are arguing that the website pictures should prevent the issuance of the temporary beer and wine permit in this case. The only consequence provided by the statute, however, is revocation or suspension of an existing permit. See S.C. Code Ann. § 61-4-580 ("A violation of any provision of this section is a ground for the revocation or suspension of the holder's permit."). Whereas the permit in question had not been issued at the time the website pictures were taken, the pictures cannot be considered evidence of why the temporary beer and wine permit should not be issued.

Regarding the remainder of the Protestants' arguments, because the beer and wine permit will be issued in the name of James Mills, these arguments are rendered moot.

Based on the testimony at the hearing and the certified copies of documents forwarded by the Department and entered into the record, I find that the application should be granted with restrictions in the name of James Mills.



EXHIBITS

Certified copies of documents forwarded to the Division from the Department are made a part of the record. At the hearing, the Petitioner placed into the record, without objection, the following:

  • Pet. Exh. Tax Map of the proposed location and surrounding areas;
  • Pet. Exh. Twelve photographs of the proposed location and surrounding areas, including three aerial photographs, and one photograph of the previous location;
  • Pet. Exh. Contract between American Legion Post 178 and SBB Four Corners, LLC;
  • Pet. Exh. Articles of Organization for SBB Four Corners, LLC; and

Pet. Exh. 7. "As built" drawing of the proposed location.

The Department placed into the record, without objection, the arrest record of James Steven Jackson (Respondent's Exhibit 1). The Protestants placed into the record, without objection, the following:

  • Prot. Exh. Photograph of the intersection of McDowell Shortcut Road and Highway 801;
  • Prot. Exh. Photograph of Highway 801 at the intersection with Highway 17 Bypass;
  • Prot. Exh. Map of the proposed location and surrounding areas; and

Prot. Exh. 4-17. Photographs printed off of the "Suck Bang Blow" website.





FINDINGS OF FACT

Having carefully considered the credibility of the testimony and accuracy of the evidence presented at the hearing and taking into consideration the burden of persuasion by the parties, I make the following findings of fact by a preponderance of the evidence:

  • Notice of the date, time, place, and subject matter of the hearing was given to the parties and the Protestants.
  • The Petitioner, American Legion Post 178, through its Senior Vice Commander John Marnell, filed an application for a temporary on-premise beer and wine permit and a temporary mini-bottle license for the premises known as "SBB Burnout Saloon," which is located at 11980 Highway 17 Bypass, Murrells Inlet, South Carolina. According to the application, the temporary permit would be issued in the name of John Marnell.
  • Mr. Marnell was born on September 13, 1941, and is more than twenty-one years of age. He has been a resident of South Carolina for ten years. He has never had a beer and wine permit revoked. He is of good moral character and has never been convicted of a crime.
  • Paul S. Goward, Chief of Police for the Horry County Police Department, signed a statement indicating he did not object to the issuance of the temporary license requested by Mr. Marnell. Because the proposed location is in Horry County, the Horry County Police Department would be responsible for providing police protection to the proposed location
  • On April 11, 2002, SBB Four Corners, LLC ("SBB LLC") filed Articles of Incorporation with the office of the Secretary of State for South Carolina. The organizers of SBB LLC are James D. Mills and James S. Jackson.
  • By contract dated April 13, 2002, SBB LLC authorized the Petitioner to sell beer and wine on the premises known as "SBB Burnout Saloon," which is located at 11980 Highway 17 Bypass, Murrells Inlet, South Carolina between May 9, 2002 and May 20, 2002. According to the contract, the Petitioner must obtain its own temporary beer and wine permit and retail license. In exchange, SBB LLC paid a non-refundable donation of $8000 to the Petitioner at the execution of the contract and gave the Petitioner a perpetual right to operate a vendor's booth at the Spring and Fall Harley-Davidson Rallies. SBB LLC also agreed to provide general liability insurance in the amount of $2,000,000, the "SBB Burnout Saloon" facility and all utilities, as well as trained and experienced personnel to sell the beer and wine. As consideration for providing the personnel, SBB LLC would retain the gross proceeds, less any taxes owed, from the sale of beer and wine.
  • James D. Mills is forty-nine years of age. He is a resident of South Carolina and has been for more than thirty days. Mr. Mills has an electrical contracting license. He owns a business, J & M Electric, which has thirty employees. I find Mr. Mills is of good moral character. Furthermore, there was no evidence presented that Mr. Mills has had a beer, wine, or liquor license previously revoked.
  • James S. Jackson is forty-four years of age. He is a resident of South Carolina and has been for more than thirty days. Mr. Jackson has prior drug offense convictions, all of which are at least ten years old. He dropped out of high school in the twelfth grade but earned his GED while in prison. He testified he no longer is involved in drug activity. He currently works at the present location of "SBB Burnout Saloon" and intends to work at the proposed location as well. Whereas Mr. Jackson has paid his debt to society, no longer is involved in drug activity, and appears to be an honest, hardworking individual, I find that he is of good moral character. Furthermore, there was no evidence presented that Mr. Jackson has had a beer, wine, or liquor license previously revoked.
  • The proposed location is situated on a five-acre lot, which is zoned "highway commercial," at the intersection of Highway 17 Bypass ("Bypass") and Highway 801. (1) The main building is approximately 24,000 sq. ft. Of the total square footage, 8000 sq. ft. consists of a retail merchandise shop, 8000 sq. ft. consists of a retail motorcycle shop, and 4000 sq. ft. consists of a miscellaneous/storage area. The remaining 4000 sq. ft. is allocated for the bar area. The proposed location recently added ten new bathrooms to accommodate the potential customers.
  • The main building of the proposed location fronts on the Bypass and is separated therefrom by four rows of parking spaces. The segment of the Bypass in front of the proposed location is a four-lane highway with a grassy median separating the two lanes that run north from the two lanes that run south.
  • Highway 801 is a two-lane road that runs along the northern side of the proposed location. The only three accesses to the proposed location are located on Highway 801.
  • There is a four-way stoplight at the intersection of the Bypass and Highway 801. At the stoplight, there is a left-turn-only lane for cars traveling north on the Bypass and a right-turn only-lane for cars traveling south on the Bypass. Both of these turning lanes access the portion of Highway 801 that runs along the northern side of the proposed location.
  • There are commercial properties and businesses located along both sides of the Bypass in the vicinity of the proposed location. Directly across the Bypass from the proposed location is a convenience store/gas station called Amoco, which is permitted to sell beer and wine for off-premise consumption. Located behind the Amoco is Mike's New York Diner and Restaurant, which is licensed to sell beer, wine, and alcoholic liquors. Also located along the eastern side of the Bypass in the immediate vicinity of the proposed location are a bank, a storage business, and a shopping mall.
  • Directly across Highway 801 from the proposed location, there is a wooded lot for sale and a sign company. On the south side of the proposed location is a four-acre wooded lot.
  • Directly behind the proposed location are a few residences separated from the proposed location by a thin line of trees.
  • James Stultz testified that there are approximately 3500 homes within a three-mile radius of the proposed location.
  • There are approximately seventeen residential communities near the proposed location. Many of the residents who live in the communities normally access their neighborhoods via Highway 801. The Protestants testified that although there are other routes that can be taken to get to the Bypass without going through the intersection of the Bypass and Highway 801, the alternate routes are longer.
  • The proposed location is not unreasonably close to any church, school, or playground.
  • Bonnie DeZwart testified that she is worried about the noise, the vulgar behavior, the traffic congestion, and the risk to nearby residential communities. James Stultz testified that he is concerned about scantily dressed women serving beer and wine and bikers who drink and drive. William Fletcher, Jr. testified that he is concerned about the noise, congestion, and lewdness. He believes this is inappropriate for a residential area. He is concerned that the bikers will try to go to McDowell Shortcut Road to "open up" their bikes. He also believes that this business will attract bikers to the Bypass whereas they mostly remained on Highway 17 Business in the past.


CONCLUSIONS OF LAW

Based upon the foregoing findings of fact, I conclude, as a matter of law, the following:

    • Pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2001) and Chapter 23 of Title 1 of the 1976 Code, as amended, the South Carolina Administrative Law Judge Division has jurisdiction in this matter.
    • The sale of beer and wine is a lawful enterprise in South Carolina, as regulated by the State.
    • S.C. Code Ann. § 61-4-240 (Supp. 2001) provides "Temporary permits for the possession, consumption, and sale of beer or wine may be issued pursuant to Sections 61-4-550, 61-6-500, 61-6-510, 61-6-2000, or 61-6-2010, as appropriate, and in accordance with these statutes."
    • S.C. Code Ann. § 61-4-550 (Supp. 2001) provides "The department may issue permits running for a period not exceeding fifteen days for a fee of ten dollars per day. Such special permits shall be issued only for locations at fairs and special functions."
    • As James Mills testified at the hearing, SBB LLC entered into the contract with American Legion Post 178 in order to obtain a mini-bottle license. Mr. Mills was eligible to obtain the beer and wine permit in his own name. On February 6, February 13, and February 20, 2002, Mr. Mills published a notice of his intent to obtain a license/permit that would allow the sale and on-premise consumption of beer, wine, and liquor at the "SBB Burnout Saloon." Whereas Mr. Mills now seeks to obtain a beer and wine permit only, the permit should be issued in his name.
    • As the trier of fact, an administrative law judge is authorized to determine the fitness or suitability of the proposed business location of an applicant for a permit to sell beer and wine using broad but not unbridled discretion. Byers v. South Carolina Alcoholic Beverage Control Comm'n, 281 S.C. 566, 316 S.E.2d 705 (Ct. App. 1984). Although "proper location" is not statutorily defined, broad discretion is vested in the judge in determining the fitness or suitability of a particular location. Fast Stops, Inc. v. Ingram, 278 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 a 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).
    • It is also the fact finder's responsibility to judge the demeanor and credibility of witnesses and determine the relevance and weight of any testimony and evidence offered. In considering the suitability of a location, it is relevant to consider whether the testimony in opposition to the granting of a license is based on opinions, generalities, and conclusions or whether the case is supported by facts. Taylor v. Lewis, 261 S.C. 168, 198 S.E.2d 801 (1973).
    • In evaluating the issuance of a beer and wine permit, the proximity of the location to a church, school, or playground is a proper ground on which the location may be found to be unsuitable and the permit denied. Byers v. South Carolina Alcoholic Beverage Control Comm'n, 305 S.C. 243, 407 S.E.2d 653 (1991). In this case, the location is not within an improper proximity to churches, schools, or playgrounds.
    • The judge may consider whether there have been any law enforcement problems in the general area. Schudel v. South Carolina Alcoholic Beverage Control Comm'n, 276 S.C. 138, 276 S.E.2d 308 (1981). Absent evidence of any law enforcement problems at this location thus far, the potential for problems is not a basis on which to deny the application in this case.
    • Unless there is sufficient evidence of an adverse impact on the community, the application must be granted if the statutory criteria are satisfied. The fact that a Protestant objects to the issuance of a permit is not sufficient reason by itself to deny the application. See 45 Am. Jur. 2d § Intoxicating Liquors § 162 (Supp. 1995); 48 C.J.S. Intoxicating Liquors § 119 (1981).
    • The proposed location is zoned as highway commercial. There are many businesses near the proposed location, including businesses that have beer and wine permits for on-premise or off-premise consumption. Furthermore, the permit will be effective for only twelve days during the Spring Rally. The noise and traffic congestion will be prevalent in the Grand Strand area during the twelve days of the Spring Rally regardless of whether this beer and wine permit is issued.
    • I understand the Protestants' concerns. The Protestants' opinions, however, are not a valid legal basis for denying the application in this case. Also, as explained at the hearing, the surrounding residential communities will be served better in this case if the permit is granted with restrictions rather than denied. If denied, "SBB Burnout Saloon" intends to remain open 24 hours per day during the Rally while providing ice for its customers and allowing them to bring their own beer and wine for on-premise consumption. As a result, the problems about which the Protestants are complaining will be worse. The traffic and the noise, specifically the motorcycle engines and outside "burnout" pits, will be constant throughout the twelve-day event. The potential for drunkdriving also may be greater. These issues can be addressed most efficiently by granting the temporary beer and wine permit with restrictions.
    • Permits and licenses issued by the State for the sale of liquor, beer, and wine are not rights or property, but are privileges granted in the exercise of the police power of the State to be used and enjoyed only so long as the restrictions and conditions governing them are complied with. As the tribunal authorized to grant the issuance of a permit is also authorized, for cause, to revoke it, that tribunal is likewise authorized to place restrictions or conditions on the permit or license. See Feldman v. S.C. Tax Comm'n, 203 S.C. 49, 26 S.E.2d 22 (1943).
    • A violation of any of the restrictions or of any regulation or section of the Alcoholic Beverage Control Act is punishable by revocation or suspension of the permit pursuant to S.C. Code Ann. § 61-4-580 (Supp. 2001).
    • During the hearing, Mr. Mills testified about several things he was willing to do to alleviate the problems raised by the Protestants. The day after the hearing, the Petitioner submitted a letter memorializing Mr. Mills's offers. Taking into consideration the proposed stipulations, I conclude the temporary beer and wine permit should be subject to the following restrictions:
      • The proposed location must not operate between 1:00 a.m. and 9:00 a.m. each day of the event and must not sell beer and wine between 1:00 a.m. and 11:00 a.m. each day of the event;
      • Of the three accesses from Highway 801 to the lot of the proposed location, the middle access should be closed at all times during the effective date of the permit, the access farthest from the Bypass should be the only entrance, and the access nearest to the Bypass should be the only exit;
      • During the hours of operation, at least one retired or off-duty police officer should be stationed at the designated entrance, another at the designated exit, and another across Highway 801 from the designated entrance in the right-of-way to prevent motorcycle traffic from traveling west on Highway 801;
      • At all times during the effective date of the permit, a privacy fence at least 8 feet high must extend along the entire property line on Highway 801, excluding the designated entrance and exit; (2) and
      • No outside "burn-out" pits.
    • These restrictions should resolve most of the problems raised by the Protestants. Regarding the problem of traffic congestion at the intersection of Highway 801 and the Bypass, while the restrictions likely will alleviate the problem, they will not resolve it entirely. The Protestants testified at the hearing, however, that there are alternate routes from the residential communities to the Bypass. Although the routes are somewhat longer and less convenient, they are viable alternatives for accessing the Bypass while avoiding the traffic entering and exiting the proposed location. Furthermore, the permit is effective only for twelve days during the Spring Rally. It is not a permanent problem affecting the residential communities throughout the year.


ORDER

Based on the foregoing findings of fact and conclusions of law,

IT IS HEREBY ORDERED that the application for a temporary on-premise beer and wine permit for the location known as "SBB Burnout Saloon," which is located at 11980 Highway 17 Bypass, Murrells Inlet, South Carolina is granted in the name of James D. Mills for the period of May 9, 2002 through May 20, 2002.

IT IS FURTHER ORDERED that the permit shall only be issued by the Department upon James D. Mills signing a written statement to be filed with the Department to adhere to the restrictions as set forth in this order.

IT IS FURTHER ORDERED that a violation of any of the restrictions will be considered a violation against the permit and may result in a fine, suspension, or revocation of the permit.

AND IT IS SO ORDERED.





__________________________________

MARVIN F. KITTRELL

Chief Administrative Law Judge



May 3, 2002

Columbia, South Carolina

1. There was confusion at the hearing about the common name for the road that runs along the northern side of the proposed location. Several witnesses referred to it as McDowell Shortcut Road while some of the Protestants referred to it as Tournament Boulevard. Based on two of the maps introduced into evidence, however, it is not McDowell Shortcut Road because the road in question actually runs perpendicular to McDowell Shortcut Road. The Tax Map prepared by the Horry County Assessor's Office instead referred to the road in question as Highway 801. See Petitioner's Exhibit 1. I, therefore, will refer to the road that runs along the northern side of the proposed location as Highway 801 throughout this order.

2. I conclude that the trees along the western side of the lot sufficiently shield the neighboring residences from viewing the proposed location and the wooded area on the southern side of the lot sufficiently shields the neighboring business from viewing the proposed location. I further conclude that because the entrance of the proposed location is more than 150 feet from the Bypass and will be blocked from view by four rows of parked vehicles and motorcycles, any passersby on the Bypass will be shielded from viewing the proposed location.


Brown Bldg.

 

 

 

 

 

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