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:
SCDOR vs. Club Rio, Inc., d/b/a Club Rio

AGENCY:
South Carolina Department of Revenue

PARTIES:
Petitioners:
South Carolina Department of Revenue

Respondents:
Club Rio, Inc., d/b/a Club Rio
 
DOCKET NUMBER:
06-ALJ-07-0665-CC

APPEARANCES:
n/a
 

ORDERS:

FINAL ORDER AND DECISION

STATEMENT OF THE CASE

This matter comes before the Administrative Law Court (ALC or Court) pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2005) and § 1-23-600(B) (Supp. 2005). The South Carolina Department of Revenue (Department) seeks to revoke the beer and wine permit and restaurant liquor by the drink license (restaurant license) of Club Rio, Inc., d/b/a Club Rio (Respondent). A hearing was held before me on September 5, 2006, at the offices of the Administrative Law Court in Columbia, South Carolina.

STIPULATIONS OF FACT

At the hearing into this matter and pursuant to ALC Rule 25(C), the parties entered the following written stipulations of fact into the Record:

1. Club Rio, Inc. d/b/a Club Rio (“Club Rio”) is the holder of an on-premise beer and wine permit, and alcoholic beverage liquor by the drink license, for the location at 1234 Main Street, in the town of Columbia, South Carolina.

2. That the following Incident Reports were necessitated as a result, directly or indirectly, of the operation of Club Rio between February, 2006 and July 28, 2006:

a. 2/5/06- Assault & Battery on EMS/Firefighter; Resisting Officer

b. 2/17/06- Two Misplaced Credit Cards (Information/Non-reportable offense)

c. 2/28/06- Burglary/Breaking & Entering (into Club Rio)

d. 3/24/06- Fights and disturbances inside club (Information)

e. 3/31/06- Fighting/Mutual Combatants (Information)

f. 4/7/06- Pointing and Presenting Firearm/Simple Assault

g. 4/15/06- Disorderly Conduct/Resisting Arrest

h. 5/19/06- Lynching

i. 6/16/06- Assaulting Police while Resisting Arrest/Fighting/Disorderly Conduct

j. 6/16/06- Resisting Arrest/Disobedience to Police Officer

k. 6/16/06- Assault on Police Officer (x2)/Disorderly Conduct (x3)/Interfering with Police (x3); Resisting Arrest, Disobedience to a Police Officer

l. 7/9/06- Lynching

m. 7/27/06- Simple Assault

n. 7/28/06- Disorderly Conduct/Resisting Arrest/Interfering with Police Officer

o. 7/28/06- Discharging Firearm (Inside Club Rio)/Lynching

p. 7/28/06- Assault & Battery with Intent to Kill/Discharge of Firearm into Dwelling

3. That amongst the most serious of the foregoing incidents, two of the foregoing resulted in three (3) police officers being injured, which required medical care, while responding to calls for service at the location.

4. That further, amongst the most serious of the foregoing incidents, two of the foregoing resulted in patrons being severely beaten by multiple persons.

5. That further, amongst the most serious of the foregoing incidents, one of the foregoing resulted in a firearm being discharged within Club Rio.

6. That as a further result of the operation of Club Rio, parking has presented a problem for the City of Columbia Police Department in that on numerous occasions patrons of Club Rio have parked in the restricted parking lot for City Hall.

7. That Club Rio has no parking lot or other reserved parking spaces for the use of its patrons.

8. That patrons of Club Rio, upon seeking admission to the location, are frequently required to wait in one or more lines that have formed in front o the location and extending down the public sidewalk.

9. That these lines of people waiting to get inside have in the past, either been the source of various disturbances or have been the victim(s) of various unruly behavior.

10. That patrons of Club Rio, coming to or going from the premises, frequently linger in the immediate vicinity and often “cruise” the immediate vicinity where Club Rio is located, in their cars or on foot - stopping so to speak with other patrons in the street, on the sidewalk, or in their cars thereby creating a traffic congestion and other associated problems – a result of which has been a number of occasions where the City of Columbia Police Department has had to set up alternative traffic patterns to accommodate the patrons and others in the immediate vicinity.

11. That patrons of Club Rio, going to or coming from the premises, frequently linger in the immediate vicinity and often “cruise” the immediate vicinity where Club Rio is located, in their cars or on foot – a result of which is increased trash in the area upon their ultimate departure of the area.

FINDINGS OF FACT

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 Petitioner and the Respondent, I make the following Findings of Fact by a preponderance of the evidence:

As set forth above, Club Rio has seen a sharp increase in the number of incidents requiring police assistance within the past six (6) months. The Columbia Police Department routinely receives a call every Thursday night or Friday morning reporting a fight in progress at the location. There have been two instances in which an “all call”[1] was issued, which required police officers to travel at high speeds to Club Rio and abandon their normal patrol area. The speed at which the officers must travel to the scene, coupled with the removal of needed law enforcement presence from normal patrol areas, further compounds the threat to the public safety or welfare created by the operation of Club Rio.

Furthermore, though this Club closes at 3:00 a.m. on Thursday and Friday and 2:00 a.m. on Saturday, traffic in the area has become a problem when the club closes at night. Many patrons loiter in the streets for up to forty-five (45) minutes after closing. Some drive their cars continuously around the block, stopping in the road to talk with pedestrians. Often fights and other criminal activity occur. On numerous occasions, this has forced the police to block off portions of the road and direct traffic out of the area. This also compounds the threat to the public safety or welfare created by the operation of Club Rio.

All of the witnesses agreed that the club’s recent transition to “hip-hop” and rap music attracted patrons who engaged in the behavior that created problems for the law enforcement and the community in general. Though Respondent may have recently somewhat modified their musical format, the changes clearly have not lessened the problem of unlawful conduct in the area. Furthermore, though the owners have made an attempt to increase the security presence at the club in the past year, their measures have not reduced the danger to the public created by their operation of this business.

Nevertheless, Club Rio has been in operation since 2003. During that time the Club has had a variety of music formats that it presented to its patrons. The recent move to “hip-hop” and rap music was the result of a loss of business after another club in the Vista area opened with a similar format. Before Club Rio began operating with the “hip-hop” and rap music format, it had never had any violations concerning its permit or license and was not a nuisance to the community.

CONCLUSIONS OF LAW

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. 2005) grants jurisdiction to the Court to hear contested cases under the Administrative Procedures Act. Specifically, S.C. Code Ann. § 61-2-260 (Supp. 2005) grants the ALC the authority to hear contested case hearings in matters governing alcoholic beverages, beer and wine.

2. The Department is charged with the responsibility of administering the laws and regulations governing the sale of alcoholic beverages in South Carolina. See S.C. Code Ann. § 61-2-80 (Supp. 2005). Pursuant to that authority, the Department may suspend or revoke a beer and wine permit or an alcoholic license that violates the provisions of S.C. Code Ann. §§ 61-4-590 or 61-6-1830 (Supp. 2005).

3. The Department argues that the permit and license of Club Rio should be revoked because Michael Gibson, a principal of Club Rio, was convicted of possession of cocaine on July 26, 2005. S.C. Code Ann. § 61-2-100 (D) generally provides that “[t]he department may not issue a license or permit under this title to any person unless the person and all principals are of good moral character.” Principals include:

·        an officer of the business or entity which owns the business;

·        a partner other than a limited partner who cannot exercise any management control;

·        a person who owns twenty-five percent or more of the combined voting power of the business or entity;

·        a person who owns twenty-five percent or more of the value of the business entity; or

·        an employee who has day-to-day operational management responsibilities for the business or entity.

See S.C. Code Ann. § 61-2-100 (H)(2)(a), (b), (f), (g) and (h) (Supp. 2005). More specifically, S.C. Code Ann. § 61-4-520 (Supp. 2005) provides that a beer or wine permit may not be issued to “a partner, or co-shareholder of the applicant” unless the person is of “good moral character.” The Department may revoke the permit of a person failing to comply with the requirements of that Section. See S.C. Code Ann. § 61-4-270 (Supp. 2005). Likewise, S.C. Code Ann. § 61-6-1820 (2) also requires that a corporation holding a restaurant liquor by the drink license have “a reputation for peace and good order in its community, and [that] its principals [be] of good moral character.” Failures to meet those requirements are also grounds for revocation of the license. S.C. Code Ann. § 61-6-1830.

In support of its contention the Department introduced a copy of a “rap sheet” that had been obtained by the Columbia Police Department.[2] The “rap sheet” reflects that Michael Gibson was convicted of possession of cocaine with a sentence start date of July 26, 2005. The mere possession of cocaine is a crime of moral turpitude. State v. Major, 301 S.C. 181, 391 S.E.2d 235 (1990). “A crime involving moral turpitude is an act of baseness, vileness, or depravity in the private and social duties which man owes to his fellow man or to society in general, contrary to the customary and accepted rule of right and duty between man and man.” State v. Perry, 294 S.C. 311, 312, 364 S.E.2d 201, 202 (1988). Obviously, a conviction of a crime of moral turpitude reflects a lack of “moral character.” In fact, a conviction of possession of cocaine has been the basis for our Supreme Court’s determination that an attorney no longer possessed the moral character to be a member of the bar. See Matter of Gibson, 302 S.C. 12, 393 S.E.2d 184 (1990).

The Respondent, on the other hand, contends that Mr. Gibson was not convicted of possession of cocaine, but illegal possession of steroids. In support of its contention, Respondent submitted the Sentence sheet which reflected that Michael Gibson plead guilty to violation of S.C. Code Ann. § 44-53-370 (d)(2). Evidence of a final judgment is admissible “to prove any fact essential to sustain the judgment.” S.C. R. Evid. 803(22). Proof of a final judgment is usually established by a certified copy of a judgment.[3] However, neither the Department nor the Respondent submitted certified copies of the respective documents.[4] Furthermore, Respondent contests the accuracy of the statements within the “rap sheet.” Since neither document is certified in accordance with Rule 902, neither document is entitled to a presumption that the contents of the record establish the statements therein. S.C. R. Evid. 1005. In addition, no testimony was presented comparing the documents to the original, if any exists. When an issue is raised about whether document in evidence correctly reflects the contents, it is left up to the trier of fact to resolve the issue and determine the facts. S.C. R. Evid. 1008. Thus, it is the duty of this Court to weigh the evidence presented.

Here, a copy of the sentencing sheet pronounced by the court carries much more weight than a “rap sheet.” A copy of the judgment reflects that Michael Gibson plead guilty to violating S.C. Code Ann. § 44-53-370 (d)(2). Section 44-53-370 (d)(2) provides that a person who knowingly or intentionally possesses a controlled substance classified in Schedules I through V without a prescription (or as otherwise authorized by Article 3 of Title 53, Chapter 44) is guilty of a misdemeanor. Thus, the judgment submitted into evidence reflects a plea to possessing a vast range of possible drugs – some which may be crimes of moral turpitude, others which may not be crimes of moral turpitude. Moreover, though Schedule II[5] includes cocaine in its list, if Michael Gibson did plead to possession of cocaine the provision following Section 370 (d)(2), S.C. Code Ann. § 44-53-370 (d)(3), would seem to be the more logical violation of the drug laws. Therefore, I do not find that the evidence sufficiently established that Michael Gibson was convicted of possession of cocaine and, accordingly, the evidence did not establish that he lacks the moral character to be a principal of Club Rio.[6]

4. The Department also argues that the permit and license of Club Rio should be revoked because the Club has become a “public nuisance” and no longer has a “reputation for peace and good order.” S.C. Code Ann. § 61-4-580 (5) (Supp. 2005) provides that no holder of a beer or wine permit may “knowingly. . . permit any act, the commission of which tends to create a public nuisance. . . .” In instances in which a permit holder becomes a “public nuisance,” the Department may revoke or suspend the permit pursuant to the South Carolina Revenue Procedures Act. S.C. Code Ann. § 61-4-590 (Supp. 2005).

A nuisance is a substantial and unreasonable interference with the use and enjoyment of ones property. O'Cain v. O'Cain, 322 S.C. 551, 473 S.E.2d 460 (Ct. App. 1996). “It is anything which hurts, inconveniences, or damages; anything which essentially interferes with the enjoyment of life or property.” 473 S.E.2d at 466. To constitute a public nuisance, a nuisance must be in a public place or where the public frequently congregates, or where members of the public are likely to come within the range of its influence. Neal v. Darby, 282 S.C. 277, 318 S.E.2d 18 (Ct. App. 1984). “The difference between a public nuisance and a private nuisance does not consist in any difference in the nature or character of the thing or activity itself.” Home Sales, Inc. v. City of North Myrtle Beach, 299 S.C. 70, 382 S.E.2d 463 (Ct. App. 1989). In other words, “[a] nuisance is public because of the danger to the public which might have been created.” Home Sales, Inc. v. City of North Myrtle Beach, 299 S.C. 70, 382 S.E.2d 463 (Ct. App. 1989). However, it is not based on “the number of persons annoyed, but the possibility of annoyance to the public by invasion of its rights, the fact that it is in a public place and annoying to all who come within its sphere.” Belton v. Wateree Power Co., 123 S.C. 291, 115 S.E. 587 (1922). Furthermore, whether an act(s) constitutes a nuisance depends upon the facts of the case and “no definite rule can be laid down for the determination of the question.” Winget v. Winn-Dixie Stores, Inc., 242 S.C. 152, 130 S.E.2d 363 (1963).

S.C. Code Ann. § 61-6-1820 (Supp. 2005) requires that an applicant for a restaurant license must have a “reputation for peace and good order in its community.” Furthermore, S.C. Code Ann. § 61-6-1830 (1) (Supp. 2005) provides that the Department may suspend or revoke a restaurant license upon finding that the restaurant no longer meets the requirements of Section 61-6-1820.

5. As set forth above, the Department, and therefore the ALC, has the authority to revoke or suspend Respondent’s permit and/or license. In this case, the evidence clearly shows that law enforcement officers have had to respond to numerous complaints of crimes and violent incidents at the location, which have increased in both frequency and severity. Because of these incidents, law enforcement is unable to maintain public order or provide for the safety of members of the public in the area and patrons of the location. Thus, Respondent no longer has a reputation for peace and good order in the community. Furthermore, in light of the totality of the malfeasance which has occurred at Club Rio, it constitutes a public nuisance.

Nevertheless, Club Rio operated for several years without any violations of its permit or license or any problems with law enforcement. All of the witnesses agreed that the club’s recent transition to “hip-hop” and rap music attracted patrons who created the problems that warranted this proceeding and the prior suspension of the license and permit pending this decision. Club Rio has stipulated that it will return to the music format of jazz and/or top forty so as to avoid the type of individuals that were attracted to the location when it featured “hip-hop”/rap music. It has also redecorated the interior of the Club, including the addition of more tables and chairs which go along with an expanded menu. Furthermore, at the hearing this Court expressed concern about the Club continuing to operate under the same name, if it indeed intended to seek a different clientele. Following the hearing, Respondent’s attorney notified this Court that Club Rio had changed the operating name of the Club.

In light of the mitigating evidence, I find that the Respondent’s permit and license should be suspended for thirty (30) days.[7] I further find that the Club shall only be allowed to operate as set forth below. To insure that the public is protected, this Order shall not become a Final Decision in this case until six months have passed from the date of its issuance.

ORDER

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

IT IS HEREBY ORDERED that Respondent’s permit and license is suspended for thirty (30) days beginning August 15, 2006.

IT IS FURTHER ORDERED that Club Rio shall only be allowed to operate with a jazz and/or top forty music format. The name of the Club shall also be substantially changed before the Club is permitted to sell beer, wine or alcohol.

IT IS FURTHER ORDERED that this Order shall not become a Final Decision in this case until six months have passed from the date of its issuance. During the interim six months, if any facts occur warranting the modification of this Order, the parties may petition this Court to modify the terms of this Order.

AND IT IS SO ORDERED.

___________________________________

Ralph King Anderson, III

Administrative Law Judge

September 8, 2006

Columbia, South Carolina



[1] An “all call” is a call that goes out over the police radio requesting that all law enforcement respond to a specific location. Chief Dean Crisp testified that when an “all call” is sent out, it is assumed that another officer has been injured or is in immediate danger and needs urgent help.

[2] “Evidence of a final judgment . . . entered after a trial or upon a plea of guilty . . . adjudging a person guilty of a crime punishable by death or imprisonment in excess of one year, to prove any fact essential to sustain the judgment” is not excluded under the hearsay rule. S.C. R. Evid. 803(22). It is questionable whether the “rap sheet” though admitted without objection is sufficient proof, without other extrinsic evidence, that a criminal conviction occurred. Nevertheless, a determination of that issue is not necessary in this case.

[3] S.C. R. Evid. 901 provides that the requirement of authentication as a condition precedent to admit a public record is satisfied by evidence “that a writing authorized by law to be recorded or filed and in fact recorded or filed in a public office, or a purported public record, report, statement, or data compilation, in any form, is from the public office where items of this nature are kept.” Extrinsic evidence of that authenticity is not required if a copy of an official record or document is certified as correct by the custodian authorized to make the certification or in compliance with any state statute. S.C. R. Evid. 902(4). In that regard, S.C. Code Ann. § 19-5-10 (Supp. 2005) provides for the admissibility of certified copies or certified photostatic copies of documents in South Carolina courts.

[4] The Department certified the “rap sheet” itself, but that certification is not by the public body from which the document was obtained and is thus obviously immaterial.

[5] See S.C. Code Ann. § 44-53-210 (b)(4) (2002).

[6] This holding does not mean that I find that Michael Gibson has sufficient moral character to hold a permit or license under Title 61. Rather, this holding merely means that since the evidence presented at the hearing did not establish that he was specifically convicted of possession of cocaine, there is not sufficient evidence at this time to revoke his permit upon that ground. Other evidence could potentially establish otherwise. Thus, if Club Rio continues to operate with Michael Gibson as a principal, it does so at its own risk.

[7] The suspension period will include the time that Club Rio’s permit and license was summarily suspended pursuant to my Order dated August 11, 2006. However, after I issued the Order summarily suspending Respondent’s permit and license, Respondent obtained a questionable stay of that Order. Following the issuance of that stay a hearing was held before this Court on August 15, 2006. Respondent was informed during that hearing that if it served beer, wine or alcohol after that date it would be in contempt of court. Therefore, the thirty day suspension shall begin on August 15, 2006.


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