SC Administrative Law Court Decisions

Victor Shamah (Shamah) filed with the South Carolina Department of Revenue (DOR), an application for an on-premises beer and wine permit for a business to be known as the Compound to be located at 307 N. Ocean Blvd., Myrtle Beach, South Carolina. Protests were filed by local businesses in the area, resulting in an intervention by Roger Williams (Williams) and Danny Baxley (Baxley) seeking to prevent DOR from granting the application.

In this matter, not all of the requirements for obtaining a beer and wine permit are disputed. Rather, the granting or denying of the permit turns upon the disputed matter of whether Shamah meets the requirements of the location being proper.

Protests were filed pursuant to S.C. Code Ann. § 61-4-525 resulting in a contested case before the Administrative Law Judge Division (ALJD) under S.C. Code Ann. §§ 61-2-260 (Supp. 2001), 1-23-600(B) (Supp. 2001) and 1-23-310 (Supp. 2001). The evidence and relevant factors require granting the permit. However, such can be granted only with restrictions.

Does Shamah meet the requirements for an on-premises beer and wine permit in light of an allegation that the location is improper?

1. Positions of Parties

Shamah asserts he meets the statutory requirements. DOR states it would have granted the permit but for the filing of protests asserting the location is improper. Accordingly, DOR awaits the outcome of this hearing. The protestants assert the permit should be denied since the location is not suitable.

2. Findings of Fact

Based on the preponderance of the evidence, the following findings of fact are entered:

A. General Facts of Location

On or about May 23, 2003, Shamah filed an application with the Department of Revenue for an on-premises beer and wine permit. The application is identified by DOR as AI # 32028452-6. The applicant and the location were investigated by SLED and the investigating agent drew a map generally depicting the immediate area of the proposed location. Following the notices posted by SLED and by the applicant, local business owners in the area filed protests challenging the application. Two of the protestants obtained party status as intervenors. The hearing for this dispute was held Thursday, October 31, 2002, with notice of the date, time, place and subject matter of the hearing given to the applicant, DOR, and the intervenors.

The proposed business (and the place where the beer and wine permit will be utilized) is located at 307 N. Ocean Blvd., Myrtle Beach, South Carolina. The business is styled as a 12 room bed and breakfast establishment. However, the business will not limit its service of beer and wine only to its bed and breakfast patrons, i.e. those obtaining lodging at the place of business. Rather, beer and wine is available to and will be sold to any member of the public who enters the location. The application identifies the location's business hours as being from 10:00 a.m. until 2:00 a.m. In addition to lodging for 12, the operation will provide seating for up to 40 in its downstairs area. Plans for music have not yet been established but bands have been allowed to practice at the location during the remodeling stage which is now in progress.

The immediate area in which the proposed location will utilize its beer and wine permit is a hotel area catering to family-oriented patrons. At least one of the adjacent hotels has an 80% return rate of previous customers with most of its customers being families on a short-term vacation. Further, in this location, adjacent hotels are less than 50 feet apart from building wall to building wall. With such closeness, disturbances from an adjacent location can create a significant economic impact if customers decide not to return. Here, even during the remodeling stage, bands have either performed or practiced at the proposed location until 2:30 a.m., creating a disturbance requiring intervention by at least one of the adjacent hotels.

B. Specific Facts of Location

1. Statutory Proximity Factors

No churches are in the immediate area. Likewise, no schools are nearby. Further, no residences are in the vicinity. Rather, the area is highly commercial and is predominated by hotels and resort facilities providing temporary lodging to the public at large.

2. Other Factors

No evidence exists of a history of danger from traffic accidents at the location. Likewise, no evidence shows the presence of crime in the immediate area near 307 N. Ocean Blvd. in Myrtle Beach.

Overall, the area is extensively commercial in nature. The proposed location has hotels on both sides as well as hotels across the street. In addition, an off-premises beer and wine permit is utilized at a convenience store located across the street.

Other establishments in the area hold either a beer and wine permit or an alcohol license. For example, on the next block to the north is an on-premises beer and wine permit at a pizza restaurant. On the next block to the south is a permit at the Windsurfer Motel. Indeed, in a four block radius from the proposed location, well over twenty beer and wine or alcohol licenses are in operation.

The City of Myrtle Beach imposes zoning restrictions in the area of the proposed location. At least one city official responsible for zoning opined that the business will be in violation of zoning ordinances if it allows the sale of beer and wine to members of the public at large. At least one city official has concluded that no city business license will be granted to the proposed business unless the location is in compliance with zoning requirements.

3. Conclusions of Law

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

Under S.C. Code Ann. § 61-4-520 (Supp. 2001), no beer and wine permit may be granted unless the location of the place of business is a proper location. In general, consideration may be given to any factors that demonstrate 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).

One such impact is found by examining the proximity of a proposed location to residences, churches, schools, and playgrounds. William Byers v. S.C. ABC Comm'n, 305 S.C. 243, 407 S.E.2d 653 (1991); Moore v. S.C. ABC Comm'n, 308 S.C. 160, 417 S.E.2d 555 (1992). However, in the instant case, no improper proximity to any one of the listed institutions is present. Thus, no basis for denial of the permit exists due to proximity to residences, churches, schools, or playgrounds.

However, other factors beyond proximity are relevant to a decision to grant or deny a permit. For example, a proper consideration for reviewing a beer and wine permit is examining the impact that granting the permit will have upon law enforcement. Moore v. S.C. Alcoholic Beverage Control Comm'n, 308 S.C. 167, 417 S.E.2d 555, 556 (1992). Here, no evidence demonstrates an adverse impact upon law enforcement by granting the permit. No evidence shows that granting the permit will place a strain upon police to adequately protect the community. Fowler v. Lewis, 260 S.C. 54, 194 S.E.2d 191 (1973). Likewise, no evidence shows that police have been summoned to the scene on prior occasions for alcohol related concerns. Schudel v. S.C. Alcoholic Beverage Control Comm'n, 276 S.C. 138, 276 S.E.2d 308 (1981). Likewise, the evidence does not establish that the location is near other locations that have been a constant source of law enforcement problems or are locations where loitering occurs. Palmer v. S.C. Alcoholic Beverage Control Comm'n, 282 S.C. 246, 317 S.E.2d 476 (Ct. App. 1984). Finally, law enforcement has not been involved in the past due to highway traffic presenting a location creating a traffic danger. Palmer v. S.C. Alcoholic Beverage Control Comm'n, 282 S.C. 246, 317 S.E.2d 476 (Ct. App. 1984). Thus, the impact upon law enforcement is not a basis for denial of a permit.

A consideration weighing in favor of granting a permit is a finding that the surrounding area is substantially commercial. Taylor v. Lewis, 261 S.C. 168, 198 S.E.2d 801 (1973); Ronald Byers v. S.C. Alcoholic Beverage Control Comm'n,, 281 S.C. 566, 316 S.E.2d 705 (Ct. App. 1984). Here, the area is extensively commercial with hotels on both sides of the proposed location as well as hotels across the street.

An additional consideration weighing in favor of granting the permit is the existence of other similar businesses in the area that sell beer and wine or alcohol. Taylor v. Lewis, 261 S.C. 168, 198 S.E.2d 801 (1973). Here, the next block to the north provides an on-premises beer and wine permit at a pizza restaurant, the next block to the south holds a permit at the Windsurfer Motel, and, in a four block radius from the proposed location, well over twenty beer and wine or alcohol licenses are in operation.

However, despite significant reasons for granting the permit, several problems pose obstacles to granting the permit in an unrestricted form. First, the immediate area is a hotel area catering to family-oriented patrons. In fact, at least one of the adjacent hotels has an 80% return rate of previous customers with most of those customers being families on a short-term vacation. Further, in this location, adjacent hotels are less than 50 feet apart. With such closeness, disturbances from an adjacent location can create a significant economic impact if customers decide not to return due to excess noise. At the proposed location, even during the remodeling stage, bands have played until 2:30 a.m. creating a disturbance requiring intervention by at least one of the adjacent hotels.

Second, compliance with applicable zoning restrictions is unsettled at the proposed location. The City of Myrtle Beach attempts to zone so as to separate bars from accommodation areas. Hence, at least one city official has concluded that the proposed location will not meet zoning requirements since it will sell beer and wine to members of the public at large as opposed to only patrons who are lodging at the establishment. To the same effect, at least one city official has concluded that no city business license will be granted to the proposed business unless the location is in compliance with zoning requirements.

While I make no determination on whether the proposed location will or will not be in violation of zoning, zoning is a relevant factor in reviewing a beer and wine application. Indeed, the fact-finder may consider any factors that demonstrate 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 seeking to evaluate the potential for an adverse impact, whether the permit and license will be used by a location that is in violation of zoning criteria is a pertinent consideration. 48 C.J.S. Intoxicating Liquors § 118 (1981); see Crittenden v. Hasser, 585 P.2d 928 (1978) (board properly considered zoning classification as basis for denying application).

However, while evidence of zoning compliance (and correspondingly evidence of lack of compliance) may be proper, the trial judge may limit the evidence presented so as not to unnecessarily multiply the issues and create confusion. Johnston v. Ward, 288 S.C 603, 344 S.E.2d 166 (Ct. App. 1986). Indeed, the degree to which a party may establish evidence of a position is a matter within the trial judge's discretion. See Hofer v. St. Clair, 298 S.C. 503, 381 S.E.2d 736 (1989) (the admission of evidence is a matter addressed to the sound discretion of the trial judge).

In this case, since the issue is the appropriateness of the location based upon "an infinite variety of considerations" (see Palmer, supra), to require any party to "prove" or "disprove" the zoning ordinance creates an inappropriate risk of confusion and multiple issues not required to resolve the permit and license dispute. Rather, inviting such a risk is especially inappropriate since other forums exist to challenge zoning decisions. See S.C. Code Ann. § 6-29-820 (Supp. 2001) (appeal from the zoning board is to the circuit court); § 6-29-950 (Supp. 2001) (enforcement of zoning violations is in the circuit court).

Accordingly, the evidence allowed on zoning was not presented in an effort to prove or disprove whether the zoning law will or will not be violated by the location's proposed business plans. Rather, the evidence was permitted to show that compliance with zoning restrictions for this property is at best unsettled. The unsettled nature of the property's compliance with zoning is one of the "infinite considerations" to be weighed in deciding the permit and license issue.

Thus, considering the evidence as a whole, the uncertainty of the zoning and the potential for disturbances due to noise is a sufficient basis to impose restrictions. The granting of a beer and wine permit is the granting of a privilege which may be restricted under the police powers of the State. Feldman v. S.C. Tax Comm'n, 204 S.C. 49, 26 S.E.2d 22 (1943). Furthermore, permits and licenses are authorized by statute and regulation to be issued with restrictions. S.C. Code Ann. § 61-2-80 (Supp. 2001); 23 S.C. Code Ann. Regs. 7-88 (1976). Indeed, at the conclusion of the hearing, Shamah offered to accept a permit with restrictions. Shamah agreed to the following:

1. The permit will be issued to a business that will operate as a bed and breakfast motel.

2. No live music of any kind shall occur on the premises.

3. The permit is contingent upon SLED's inspection of the building to assure that construction and layout are in compliance with ABC laws and regulations.

The above three restrictions offered by Shamah are accepted and are imposed along with the following:

4. The beer and wine permit can only be utilized at a location that is in compliance with applicable zoning ordinances, restrictions, and regulations.

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

DOR is ordered to grant Victor Shamah's application for an on-premises beer and wine at 307 N. Ocean Blvd., Myrtle Beach, South Carolina only upon DOR and Shamah agreeing to the following restrictions upon the permit:

1.The business will operate as a bed and breakfast motel.

2. No live music of any kind shall occur on the premises.

3. SLED must inspect the building and conclude that the construction and layout are in compliance with ABC laws and regulations.

4. The beer and wine permit can only be utilized at a location that is in compliance with applicable zoning restrictions and regulations.

These restrictions shall become a part of the permit and any violation of the restrictions shall be subject to enforcement in the same manner as any comparable violation of the permit itself.

AND IT IS SO ORDERED.

_________________________________

RAY N. STEVENS

Administrative Law Judge

Dated: November 12, 2002

Columbia, South Carolina