ORDERS:
FINAL ORDER AND DECISION
STATEMENT OF THE CASE
This matter comes before me pursuant to S.C. Code Ann. § 61-2-260 (Supp. 2002) and S.C.
Code Ann. §§ 1-23-310 et seq. (1986 and Supp. 2002). The South Carolina Department of Revenue
(“Department”) contends that Respondent JOADAM’s, Inc., d/b/a Paul’s Food & Deli
(“Respondent”) permitted the purchase of beer by a person under the age of twenty-one, in violation
of 23 S.C. Code Ann. Regs. 7-9(B) (Supp. 2002), for the third time in a three-year period. For this
violation, Department seeks a forty-five (45) day suspension of Respondent’s beer and wine permit,
Permit No. 32009477-P7B. After timely notice to the parties, a hearing was conducted on August
1, 2003, at the Administrative Law Judge Division (“ALJD”), Columbia, South Carolina, wherein
Respondent admitted the violation in question and presented evidence and argument regarding the
penalty to be imposed for such violation. Based upon the testimony and evidence presented, I find
that Respondent’s beer and wine permit should be suspended for a period of ten (10) days for
violating 23 S.C. Code Ann. Regs. 7-9(B) (Supp. 2002).
STIPULATION
At the hearing on this matter, the parties stipulated that on March 15, 2003, Respondent
violated 23 S.C. Code Ann. Regulation 7-9b (Supp. 2002) when its employee permitted a person
under the age of twenty-one to purchase beer on its premises at 310 Broad Street, Charleston, South
Carolina.
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.Respondent holds a permit to sell beer and wine for off-premises consumption (Permit
No. 32009477-P7B) for its business located at 310 Broad Street, Charleston, South Carolina.
2.On March 15, 2003, SLED agents conducted an investigation of the Respondent’s
business at the permitted location. SLED Agent Clarke provided $20 to an underage cooperating
individual (“UCI”), who was sixteen years old at the time. The UCI entered Respondent’s store,
picked up a 22-ounce bottle of Bud Light, and took it to the clerk on duty at the register. The clerk
asked the UCI for her driver’s license. The UCI handed the clerk her South Carolina’s driver’s
license, which showed her to be sixteen years of age and which stated in bold letters “UNDER 18
UNTIL 04-11-2004.” The clerk rang up the sale, and the UCI paid $1.37 for the Bud Light. The
UCI exited the store and carried the beer to Agent Clarke, who took custody of it.
3.Agent Clarke issued a Violation Report to Respondent for violation of 23 S.C. Code
Ann. Regs. 7-9(B) (Supp. 2002), permitting the purchase of beer by a person under the age of
twenty-one. Agent Clarke also issued a Uniform Traffic Ticket to the clerk for a violation of S.C.
Code Ann. § 61-4-90 (Supp. 2002), transfer of beer to a person under the age of twenty-one.
4.Respondent has had two prior violations within a three-year period at the permitted
location for permitting an underage person to purchase beer or wine.
5.The Department issued a final determination on May 21, 2003, sustaining the violation
of 23 S.C. Code Ann. Regs. 7-9(B) (Supp. 2002) and seeking to suspend Respondent’s beer and wine
permit for a period of forty-five (45) days. Respondent timely appealed the determination, and the
matter was timely transmitted to the ALJD for a contested case hearing.
6.Respondent was represented at the hearing by Ms. Jo Ann Adams, president of the
Respondent corporation. Ms. Adams stipulated that the violation in question occurred and requested
that a lesser penalty than that sought by the Department be imposed, stating that a suspension of her
permit for forty-five (45) days would substantially hurt her business. In requesting a lesser penalty,
Ms. Adams presented the following mitigating evidence. Ms. Adams testified that since the third
violation, she arranged for SLED Agent Kirkland, who provides statewide training on the State’s
alcoholic beverage laws and on methods of checking identification, to train her employees in the sale
of alcohol. Ms. Adams’s employees attended a training session with Agent Kirkland in July 2003.
Ms. Adams stated that she had not required the SLED training of her employees before the third
violation because she had not known then that such a training program existed. Ms. Adams said she
felt Mr. Kirkland’s presentation made an impact on her employees, and she intends to have Mr.
Kirkland provide additional training to them in the future. Ms. Adams further testified that she
enrolled her employees in the TIPS training, provided by a local distributor, regarding the sale of
alcoholic beverages, and she presented evidence that her employees received certificates of
completion of that program in June 2003. Ms. Adams also testified that her store purchased a
scanner, which can scan a customer’s driver’s license and verify the customer’s age, and attached it
to the cash register. She testified that since her employees have been using the scanner, they were
able to detect through the scanner that one customer’s identification, which appeared valid upon
personal examination, had actually been altered and was invalid; thus, they were able to prevent a
potential sale of alcohol to a minor in that way. Additionally, Ms. Adams stated that she now requires
all new employees to read and sign a document stating that they will be immediately fired if they sell
alcohol to an under-aged person. Based upon my personal observations of Ms. Adams’s demeanor
during her testimony, I find Ms. Adams to be a very credible witness who is genuinely concerned in
ensuring that no future violations occur at the subject location.
7.Ms. Adams’s son, Robert Paul Adams, testified that he works at the subject location,
taking care mainly of the paperwork and the training of new employees. Mr. Adams testified that
after the third violation, he reprogrammed the computer in the cash register so that employees can
no longer manually bypass the step of having to enter a customer’s birth date before they ring up a
sale of an alcoholic beverage. I find Mr. Adams to also be a very credible witness who is also
genuinely concerned in ensuring that no future violations occur at the subject location.
CONCLUSIONS OF LAW
Based upon the above-listed findings of fact, I conclude the following as a matter of law:
1.S.C. Code Ann. § 1-23-600 (Supp. 2002) grants jurisdiction to the ALJD to hear
contested cases under the Administrative Procedures Act. Specifically, S.C. Code Ann. § 61-2-260
(Supp. 2002) grants the ALJD 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 and enforcing the
laws and regulations governing alcoholic beverages, including beer and wine. S.C. Code Ann. § 61-2-20 (Supp. 2002).
3.The parties stipulate, and I find, that Respondent violated 23 S.C. Code Ann. Regs.
7-9(B) (Supp. 2002) by permitting the purchase of beer by a person under the age of twenty-one.
Regulation 7-9(B) provides:
To permit or knowingly allow a person under twenty-one years of age to purchase or
possess or consume beer or wine in or on a licensed establishment which holds a
license or permit issued by the South Carolina Alcoholic Beverage Control
Commission is prohibited and constitutes a violation against the license or permit.
Such violation shall be cause to suspend or revoke the license or permit by the
Alcoholic Beverage Control Commission.
23 S.C. Code Ann. Regs. 7-9(B) (Supp. 2002). Thus, the only issue before me is the penalty to be
imposed for such violation.
4.The Department has jurisdiction to revoke or suspend permits authorizing the sale of
beer or wine. S.C. Code Ann. § 61-4-590 (Supp. 2002). The Department may suspend or revoke
a beer and wine permit if the permittee has knowingly sold beer or wine to a person under the age of
twenty-one. S.C. Code Ann. §§ 61-4-270 and -580 (Supp. 2002); 23 S.C. Code Ann. Regs. 7-9(B)
(Supp. 2002). The Department may exercise this authority to suspend or revoke a permit for a first
violation. See S.C. Code Ann. §§ 61-4-270, -580, and -590 (Supp. 2002); 23 S.C. Code Ann. Regs.
7-9(B) (Supp. 2002). In lieu of such suspension or revocation, the Department may, in its discretion,
impose a monetary penalty upon the holder of a beer or wine permit. S.C. Code Ann. § 61-4-250
(Supp. 2002). For retail beer and wine permittees, this monetary penalty must be no less than $25
and no greater than $1,000. Id.
5.The Administrative Law Judge as the finder of fact is empowered to impose the
appropriate penalty based on the facts presented. Walker v. S.C. ABC Comm’n, 305 S.C. 209, 407
S.E.2d 633 (1991). In assessing a penalty, the finder of fact “should give effect to the major purpose
of a civil penalty - deterrence.” Midlands Util., Inc. v. S.C. Dep’t of Health & Envtl. Control, 313
S.C. 210, 212, 437 S.E.2d 120, 121 (Ct. App. 1993).
6.The purpose of the statutory prohibition against selling alcohol to underage individuals
is to protect both the underage individuals who purchase the alcohol and the public at large from the
possible adverse consequences of such purchases. Norton v. Opening Break of Aiken, Inc., 313 S.C.
508, 443 S.E.2d 406 (Ct. App. 1994), aff’d 319 S.C. 469, 462 S.E.2d 861 (1995); Whitlaw v. Kroger
Co., 306 S.C. 51, 410 S.E.2d 251 (1991). The sale of alcohol to an underage individual is a serious
offense and cannot be taken lightly.
7.A permit to sell beer and wine is neither a contract nor a property right. Rather, it is
merely a permit to do what otherwise would be unlawful to do, and is 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). Accordingly, there are legal consequences for a
permitee’s noncompliance with the alcoholic beverage laws of this State.
8.The Department’s Revenue Procedure 95-7 sets forth penalty guidelines for violations
of the statutes and regulations governing the sale, distribution, and possession of alcohol, beer, and
wine. For retail beer and wine permits, Revenue Procedure 95-7 provides for a $400 fine for the first
offense, an $800 fine for the second offense, a forty-five (45) day suspension of the permit for the
third offense, and revocation of the permit for the fourth offense. This Revenue Procedure only
provides guidance to the Department; it is not law and thus is not binding on the ALJD.
9.In this case, Respondent has presented evidence of a number of steps it has taken to
ensure that its employees comply with the laws and regulations regarding the sale of alcohol,
including the training of its employees by SLED Agent Kirkland, the employees’ participation in TIPS
training, and the purchase and use of the scanner at the cash register. I realize, as pointed out by
counsel for the Department, that these steps were only put into place after Respondent’s third
violation. However, Ms. Adams testified that she was unaware that the training programs existed
until after the third violation. Further, I am aware of the Department’s concerns, articulated well by
counsel, that penalties be applied consistently for successive violations of the alcoholic beverages
laws, and that, due to the seriousness of the offense of selling alcoholic beverages to minors, large
penalties are needed to effectively deter permittees from committing future violations. However,
given my finding regarding Ms. Adams’s demeanor during the hearing and the genuineness of her
expressed commitment to ensure that her employees receive proper training in requesting and
examining identification from customers seeking to purchase alcoholic beverages and training in the
State’s alcoholic beverage laws, and the efforts to which she and Mr. Adams have gone to ensure that
no future violations occur, I find that mitigation of the penalty sought by the Department is warranted
in this particular case.
10.Ms. Adams requests that, in lieu of suspension, this tribunal fine Respondent for the
instant violation. However, pursuant to S.C. Code Ann. § 61-4-250 (Supp. 2002), the most this
tribunal could fine Respondent would be $1,000, which I find to be an insufficient penalty for a third
violation of selling alcohol to a minor, despite the aforementioned mitigating factors and the
demeanor of Ms. Adams. Therefore, in lieu of a fine, this tribunal must look to suspend the permit
at issue. Given the mitigating factors involved and the genuineness of Respondent’s witnesses in this
matter, I find a suspension of ten (10) days to be an appropriate penalty in this case.
ORDER
Based upon the foregoing findings of fact and conclusions of law,
IT IS HEREBY ORDERED that Respondent’s beer and wine permit, Permit No. 32009477-P7B, be suspended for a period of ten (10) days, commencing on a date to be agreed upon by the
parties within thirty (30) days of the signing of this Order, for violating 23 S.C. Code Ann. Regs. 7-9(B) (Supp. 2002)
AND IT IS SO ORDERED.
_________________________________
C. DUKES SCOTT
Administrative Law Judge
August 1, 2003
Columbia, South Carolina |
