ORDERS:
FINAL ORDER AND DECISION
STATEMENT OF CASE
This matter comes before me on citations issued by the Department of Revenue for a
violation of S.C. Code Ann. §§ 61-6-2600(4) and 61-2-140(E) (Supp. 2002) for refilling minibottles.
The Departments seeks a $1000 fine and the revocation of the beer and wine permit as well as the
minibottle license. The Respondent requested a hearing on the violation and proposed penalty.
After notice to the parties, a hearing was conducted on June 26, 2003 with the parties represented
as indicated above. The Department established the violations; the request to revoke the minibottle
license and the beer and wine permit is denied. The minibottle license shall be suspended for 60 days
from the date of this Order and a $500 fine is imposed.
FINDINGS OF FACT
1. Centerpiece, Inc. holds a minibottle sale and consumption license and on-premises
beer and wine permit issued by the South Carolina Department of Revenue. On November 15, 2002,
this license and permit were valid at the location, 20 Pendleton Street, Greenville, SC.
2. On November 15, 2002 SLED Special Agent James R. Causey, while conducting an
inspection of the Respondent’s licensed premises at 20 Pendleton Street, Greenville, South Carolina,
discovered one hundred forty five (145) minibottles containing alcoholic beverages, the seals of which
had been broken. The minibottles with the broken seals were found behind the bar near the kitchen.
The tops on these minibottles had been replaced after each minibottle was opened.
3.The amount of liquor in the minibottles was not uniform, even in all the minibottles
of a particular brand.
4. No large containers of alcohol were found on the premises.
5. John Lewis, the owner of the Respondent club, testified that he had not refilled the
bottles, and that his employees had not done so. He testified that when he found out that an
employee was twisting the caps on the minibottles, thereby breaking the seal on the bottle, in advance
of the sale, he terminated the employee.
6.There was a violation at this location on July 14, 2001 for possession of liquor in
containers larger than two ounces. The Respondent paid a four hundred dollar fine for that violation.
CONCLUSIONS OF LAW
Based upon the foregoing Findings of Fact, I conclude, as a matter of law, the following:
1.S.C. Code Ann. § 1-23-600 (Supp. 2002) grants jurisdiction to the Administrative
Law Judge Division to hear contested cases under the Administrative Procedures Act.
2.S.C. Code Ann. § 61-2-26 0 (Supp. 2002) grants to the Administrative Law Judge
Division the powers, duties and responsibilities to hear contested matters governing alcoholic
beverages, beer, and wine.
4.A person who is licensed to sell alcoholic liquors and who displays minibottles when
the seals are broken shall be fined not less than $1000 and have his license permanently revoked for
any violation involving the avoidance of taxes. S.C. Code Ann. §61-6-2600 (Supp. 2002).
5.Refilling minibottles from a larger container constitutes the avoidance of taxes that
would be collected on the purchase and sale of filled minibottles. Carman v. S.C. Alcoholic Beverage
Control Commission, 315 SC. 320, 433 S.E.2d 885 (Ct. App. 1993), rev'd on other grounds 317
S.C.1, 451 S.E.2d 383 (1994).
6.A licensee may be held liable for violations of liquor regulations committed by his
agent while pursuing the ordinary business entrusted to him. The licensee is liable even though the
violations are committed in his absence and without his knowledge, consent, or authority. See 48
C.J.S. Intoxicating Liquors § 276 (1981).
7.S.C. Code Ann. § 61-6-2600 (Supp. 2002) provides penalties in the form of a fine,
suspension or revocation of the license of a person authorized to sell alcoholic beverages who
displays minibottles when the seals are broken or who violates any provision which involves the
avoidance of taxes.
8. S. C. Code Ann. § 61-6-2400 (Supp. 2002) provides that alcoholic liquors sold in
minibottles must be taxed pursuant to Chapter 33 of Title 12.
9.If a licensee violates any regulation or code section of the Alcoholic Beverage Control
Act, pursuant to S. C. Code Ann. § 61-6-1830 (Supp. 2002) his license may be suspended or
revoked.
10.Permits and licenses issued by the State of South Carolina for the sale of liquor, beer,
and wine are not rights or property, but are rather 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. Feldman v. South Carolina Tax Commission, 203 S.C. 49, 26 S.E. 2d 22
(1943).
11.I conclude that the circumstantial evidence in this cases proved by a preponderance
of the evidence that Respondent violated S.C. Code Ann. § 61-6-2600 by possessing and displaying
minibottles whose seals were broken and which were filled with liquor.
ORDER
Pursuant to S. C. Code Ann. § 61-6-2600 (4) (Supp. 2002), the sale and consumption
(“minibottle”) license can be permanently revoked and a fine levied against the Respondent for a
violation involving the avoidance of taxes. In addition, S. C. Code Ann. § 61-2-140 (E) (Supp.
2002) allows the Department to “revoke all other licenses or permits held by the person if the
suspended or revoked premises is within close proximity.” These remedies appear harsh when applied
to the facts of this case. I therefore find that the penalties provided in S. C. Code Ann. § 61-6-2600
(2) (Supp. 2002) shall be applied to the Respondent. Since this violation constitutes a second offense,
it is therefore ordered that the Respondent’s private club sale and consumption license is suspended
for sixty days from the date of this Order and a fine of five hundred ($500.00) dollars is imposed on
the Respondent.
And It Is So Ordered.
____________________________
August 6, 2003Carolyn C. Matthews
Columbia, SCAdministrative Law Judge |
