SC Administrative Law Court Decisions

STATEMENT OF THE CASE

This matter comes before this tribunal pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2001) and S.C. Code Ann. §§ 1-23-310 et seq. (1986 & Supp. 2001) for a contested case hearing. Petitioner Johnny Clyburn seeks an on-premises beer and wine permit for his game room located at 400 ½ East Gay Street, Lancaster, South Carolina. The Department of Revenue (Department) would have granted the permit but for the protest filed by the Lancaster Police Department regarding the suitability of the proposed location. ⁽¹⁾ On September 17, 2002, the Lancaster Police Department moved, pursuant to ALJD Rule 20, for leave to intervene in this matter in opposition to Petitioner's application. The motion for intervention was granted by an Order dated October 1, 2002.

After timely notice to the parties, a hearing of this case was held on October 23, 2002, at the Administrative Law Judge Division in Columbia, South Carolina. Based upon the evidence presented regarding the suitability of the proposed location, particularly that concerning criminal activity at or near the location, and the applicable law, Petitioner's application for an on-premises beer and wine permit is hereby denied.

FINDINGS OF FACT

Having carefully considered all testimony, exhibits, and arguments presented at the hearing of this matter, 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. Petitioner submitted an application for an on-premises beer and wine permit to the Department on June 6, 2002, for the premises located at 400 ½ East Gay Street, Lancaster, South Carolina. This application is incorporated into the record by reference.

2. Petitioner leases the premises from Hook & Associates Realty Company of Columbia, South Carolina. Petitioner has operated the premises as a game room since June 2002. Prior to Petitioner's activities, the location was operated as Bobby's Game Room and was licensed for the sale of beer and wine for on-premises consumption. This establishment was run by Petitioner's brother-in-law and, on occasion, Petitioner assisted with the operation of the business.

3. The proposed location is situated on the 400 Block of East Gay Street in Lancaster, South Carolina. This block, known as "The Hill," is a mixed area of residential and commercial buildings bordering on a largely residential district. While formerly a vibrant commercial center for the surrounding residential community, in more recent years The Hill has become the hub of a high-crime area known for illegal drug activity and violent crime.

At the hearing of this case, the parties stipulated to including in the record in this matter the testimony of Chief Hugh White, Lieutenant Harlene Howard, and Lance Corporal Laurie Catoe of the Lancaster Police Department and Frank Bowers of the City of Lancaster Zoning Board taken in a related case, Kirkland v. S.C. Dep't of Revenue, Docket No. 02-ALJ-17-0293-CC (S.C. Admin. Law Judge Div. Oct. 31, 2002). ⁽²⁾ In that prior hearing, Chief White described The Hill's decline from a family-oriented business district to a high-crime area marked by frequent drug activity and numerous shootings, stabbings, and assaults. Chief White also testified to the significant burden The Hill's crime problems place on local law enforcement, particularly the great number of man-hours expended on patrolling the area, and described the efforts the police department has taken to reduce crime in the area. Lieutenant Howard of the Lancaster Police Department presented certain statistics indicative of the crime problem on The Hill. According to these statistics, problems on the 400 Block of East Gay Street generated 246 calls to the police between June 1, 2000, and May 31, 2001, and 302 calls to the police between June 1, 2001, and May 31, 2002. Lance Corporal Catoe, an officer assigned specifically to patrol The Hill, described her personal observations of the crime problem in the area and the disorderly conduct, assaults, drug activity, and other problems she has witnessed occurring on The Hill.

At the hearing of the instant case, Lieutenant Howard appeared and further testified regarding police involvement not only with The Hill, but with the proposed location in particular. Lieutenant Howard submitted twenty-four police incident reports for criminal activity occurring in and around Bobby's Game Room between April 1999 and February 2002. ⁽³⁾ These reports describe incidents ranging from minor offenses such as petty thefts, public drunkenness, and vandalism to serious crimes such as assaults, stabbings, and the possession of crack cocaine with the intent to distribute. Lieutenant Howard also introduced documentation of the overtime hours expended by the Lancaster Police Department on patrolling The Hill; for February and March 2002, Lancaster Police Department officers worked 131.5 hours of overtime on The Hill.

4. At the hearing, two residents of the neighborhood surrounding The Hill, Lula Foster and Mamie Jackson, testified regarding the crime problems in the area. Both women described The Hill as an area plagued by drug activity and violent crime. Further, both Ms. Foster and Ms. Jackson stated that, to the extent possible, they avoid The Hill out of a concern for their personal safety.

5. Petitioner's establishment is located in the center of this high-crime area. While much, if not most, of the crime on The Hill is not directly attributable to Petitioner's operations and does not occur within the four walls of Petitioner's establishment, the congregation of people around Petitioner's business and a neighboring establishment is the source of a significant amount of the crime on The Hill. Further, the manner in which Petitioner operates his business has contributed to these problems. Specifically, Petitioner sells plastic cups for 15¢ a piece, or 25¢ a piece with ice, which are often used by the purchasers to consume beer and liquor outside of Petitioner's establishment. Clearly, the sale of beer and wine at Petitioner's business would only serve to exacerbate the problems on The Hill. Accordingly, I find that the proposed location is unsuitable for the issuance of a beer and wine permit.

CONCLUSIONS OF LAW

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

1. Jurisdiction over this case is vested with the Administrative Law Judge 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).

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. Alcoholic Beverage Control Comm'n, 282 S.C. 246, 248, 317 S.E.2d 476, 477 (Ct. App. 1984); see also Wall v. S.C. Alcoholic Beverage Control Comm'n, 269 S.C. 13, 235 S.E.2d 806 (1977).

3. S.C. Code Ann. § 61-4-520 (Supp. 2001) establishes the criteria for the issuance of a beer and wine permit. Included in the criteria is the requirement that the proposed location be a proper and suitable one. See id. § 61-4-520(6)-(7).

4. Although "proper location" is not statutorily defined, broad discretion is vested in the trier of fact to determine the fitness or suitability of a particular location for the requested permit. See Fast Stops, Inc. v. Ingram, 276 S.C. 593, 281 S.E.2d 118 (1981).

5. The determination of suitability of location is not necessarily a function solely of geography. Rather, 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 v. S.C. Alcoholic Beverage Control Comm'n, 276 S.C. 138, 276 S.E.2d 308 (1981).

6. In determining whether a proposed location is suitable, it is proper for this tribunal to consider any evidence that shows adverse circumstances of location. Kearney v. Allen, 287 S.C. 324, 338 S.E.2d 335 (1985); Palmer v. S.C. Alcoholic Beverage Control Comm'n, 282 S.C. 246, 317 S.E.2d 476 (Ct. App. 1984) (citing Smith v. Pratt, 258 S.C. 504, 189 S.E.2d 301 (1972)).

7. "[A] liquor license or permit may be properly 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).

8. The denial of a license to sell alcoholic beverages is appropriate where the proximity of the proposed outlet to areas of public congregation would aggravate problems related to the consumption of alcohol in public. Fast Stops, Inc. v. Ingram, 276 S.C. 593, 281 S.E.2d 118 (1981); see also Fowler v. Lewis, 260 S.C. 54, 194 S.E.2d 191 (1973) (upholding the denial of a retail beer and wine permit where the applicant's property was already the site of congregations of people attended by some consumption of alcohol and disorder). Such denial is particularly appropriate when the public areas surrounding the proposed location have been the source of constant law enforcement problems. Palmer v. S.C. Alcoholic Beverage Control Comm'n, 282 S.C. 246, 317 S.E.2d 476 (Ct. App. 1984); see also Roche v. S.C. Alcoholic Beverage Control Comm'n, 263 S.C. 451, 211 S.E.2d 243 (1975) (upholding the denial of a retail beer and wine permit upon evidence that local law enforcement had constant problems with public intoxication in the vicinity of the applicant's store).

9. Given the history of frequent criminal activity and public disturbances at and around the proposed location, I find that the sale of beer and wine at the location would be detrimental to the general welfare of the surrounding community.

There is ample evidence in the record establishing that Petitioner's property and surrounding properties are the site of frequent criminal disturbances, including problems ranging from loitering and public intoxication to violent assaults and the sale of illegal drugs. The addition of the sale of beer and wine to this volatile mix would only exacerbate The Hill's serious crime problem. And, while Petitioner is correct in noting that much of this criminal activity is not directly caused by his business and that much of it is beyond his control, it is equally true that his business has become a gathering place for certain elements of the community, and that the sale of beer and wine at the location would only make a bad situation worse.

Fowler v. Lewis, 260 S.C. 54, 194 S.E.2d 191 (1973), is instructive on this point. In that case, a grocery store and launderette was seeking a retail beer and wine permit. Local law enforcement officers testified that the store's parking lot, which, through no fault of the store, had become a place for local residents to congregate, was the site of frequent disturbances and other criminal activity. The South Carolina Supreme Court upheld the Alcoholic Beverage Control Commission's denial of the permit on the ground that, as "congregations of people on [the applicant's] property are not infrequently attended by some consumption of alcohol and disorder . . . .[,] the Commission could reasonably have concluded that the situation would be worsened by making cold beer immediately available." Id. at 58, 194 S.E.2d at 193. Such is the case here. Petitioner's business and surrounding property have become a place of congregation not infrequently attended by the consumption of alcohol and other intoxicants and by disorderly and criminal conduct. Accordingly, I conclude that the condition of the community surrounding Petitioner's property would be worsened by making beer immediately available from Petitioner's establishment.

10. This tribunal is well aware that the proposed location has been permitted for the sale of beer and wine in the past. Nonetheless, this fact alone does not entitle Petitioner to licensure of the location. A permit to sell beer and wine is neither a contract nor a property right. Rather, it is merely a permit, issued or granted in the exercise of the police power of the state to do what otherwise would be unlawful to do, and to be enjoyed only so long as the restrictions and conditions governing its continuance are complied with. Feldman v. S.C. Tax Comm'n, 203 S.C. 49, 26 S.E.2d 22 (1943). Moreover, when considering the permit history of the location, the problems associated with previous permitted establishments at the location suggest that the proposed location is unsuitable for the sale of beer and wine.

11. As the trier of fact, the issuance or denial of a permit rests within the sound discretion of this tribunal. Inherent in the power to issue a permit is also the power to refuse it. Terry v. Pratt, 258 S.C. 177, 187 S.E.2d 191 (1972). Refusal of the permit in the instant case is compelled because the issuance of the requested permit would be detrimental to the inhabitants of the community surrounding Petitioner's establishment.

ORDER

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

IT IS HEREBY ORDERED that Petitioner's application for an on-premises beer and wine permit for the premises located at 400 ½ East Gay Street, Lancaster, South Carolina, is DENIED.

AND IT IS SO ORDERED.

______________________________

JOHN D. GEATHERS

Administrative Law Judge

Post Office Box 11667

Columbia, South Carolina 29211-1667

November 7, 2002

Columbia, South Carolina

1. The Department also had a concern with the adequacy of the description of the licensed premises in Petitioner's application. However, this concern was resolved at the hearing of this matter by the submission of a new description of the premises.  See Pet'r Ex. #1.

2. Kirkland involved an application for an on-premises beer and wine permit for a restaurant neighboring the location in question in this case. The testimony of the Lancaster Police Department's Chief and other officers regarding the crime problems on The Hill and the burden on law enforcement caused by that crime, and Mr. Bowers' testimony regarding the zoning classification of The Hill taken in Kirkland are relevant to the question of the suitability of the proposed location in the instant matter.

3. Since Petitioner began operating at the proposed location in June 2002, no incident reports have been generated for the location. However, it should be noted that Petitioner has not been permitted for the sale of, and has not sold, beer and wine since the opening of his business.