SC Administrative Law Court Decisions

This matter comes before me pursuant to S.C. Code Ann. § 61-1-55 (Supp. 1995) and

S.C. Code Ann. §§ 1-23-310, et seq. (1986 & Supp. 1995) upon an application for an

on-premises beer and wine permit and business sale and consumption minibottle license for 1208 Georgia Avenue, North Augusta, South Carolina, by James D. Salter, as President and sole shareholder of Tra-Kim, Inc., filed with the South Carolina Department of Revenue and Taxation (hereinafter referred to as "DOR"). A hearing was held on February 16, 1996. The sole issues in controversy were the fitness and moral character of the Petitioner and his eligibility as a licensee/permittee. Upon finding that Petitioner meets the statutory requirements for issuance of the license and permit applied for, the license and permit are granted, with restrictions.

By a preponderance of the evidence, I find:

1. Petitioner seeks an on-premises beer and wine permit and a business sale and consumption license for a location at 1208 Georgia Avenue, North Augusta, South Carolina, having filed applications with DOR, AI #105593 and #105594.
2. Petitioner James D. Salter, a/k/a James Douglas Salter, f/k/a Douglas James Salter, is the son of Rose Z. Salter and Bruce H. Salter, and the brother of Randy David Salter.
3. The proposed location is a restaurant and lounge, known as the Buffalo Room, located adjacent to the Seven Gables Motel.
4. The real property upon which the Buffalo Room and Seven Gables Motel are situated is owned by Petitioner and his brother, Randy David Salter, said property being conveyed by deed of Rose Z. Salter, Bruce H. Salter, and Petitioner, dated January 27, 1993, and recorded on February 2, 1993, in the Aiken County RMC Office at Deed Book 1372, at page 192.
5. By the above-referenced deed dated January 27, 1993, Petitioner and Randy David Salter purchased the proposed location from Rose Z. Salter and Bruce H. Salter, which includes the real property and improvements (the Seven Gables Motel and Buffalo Room) in an arm's length transaction, paying fair marked value for the property. Rose Z. Salter and Bruce H. Salter took a purchase money mortgage on the property, which buyers continue to make monthly payments on.
6. From September 2, 1977 until January 27, 1993, the real property upon which the Buffalo Room and Seven Gables Motel are situated was owned by Rose Z. Salter, Bruce H. Salter, and Petitioner. From September 2, 1977 until December 30, 1985, Randy David Salter also owned an interest in the real property.
7. From 1977 until 1993, Rose Z. Salter and Bruce H. Salter owned and operated the business known as the Seven Gables Motel, as the sole shareholders and officers of Salter Enterprises, Inc.
8. From approximately 1980 until 1989, Rose Z. Salter and Bruce H. Salter owned and operated the business known as the Buffalo Room, as the sole shareholders and officers of Salter Enterprises, Inc.
9. The Buffalo Room was licensed to sell and serve beer, wine and liquor on premises from 1980 until 1989, with Rose Z. Salter as the licensee.
10. By Final Order of the ABC Commission dated October 24, 1989, In the Matter of: Rose Z. Salter, President, Salter Enterprises, Inc., d/b/a Buffalo Room, 1208 Georgia Avenue, North Augusta, South Carolina (BW905470; SB90863), the permit and license held by Rose Z. Salter for the Buffalo Room were revoked based upon a finding that food and beverage service was denied to certain patrons through racially discriminatory practices. The commission concluded that the corporate principals managing the Buffalo Room lacked the requisite good moral character to continue to hold an ABC license or permit.
11. The Final Order of the ABC Commission dated October 24, 1989, In the Matter of: Rose Z. Salter, President, Salter Enterprises, Inc., d/b/a Buffalo Room, 1208 Georgia Avenue, North Augusta, South Carolina (BW905470; SB90863), was not appealed. This Court takes administrative notice of that Order and incorporates it herein by reference.
12. Petitioner is not, nor was he ever, a shareholder, officer, or principal of Salter Enterprises, Inc.
13. Petitioner did not have any role in the operation, management, control, or service practices of the Buffalo Room while previously licensed.
14. Petitioner was never employed at the Buffalo Room, nor did he ever realize any profits or incur any expenses from its operation.

15. Petitioner resided in Atlanta, Georgia from 1973 until 1990, and officially established residency in North Augusta, South Carolina, in 1993.

16. Since 1993, Rose Z. Salter and Bruce H. Salter have not been involved in the operation or management of the Seven Gables Motel or the Buffalo Room.

17. Since 1993, Petitioner and Randy David Salter have operated and managed the Seven Gables Motel.

18. Petitioner intends to operate the proposed location, with George F. Poston as manager.

19. Petitioner intends to operate the proposed location as a restaurant serving short order and grill items, as well as bar beverages, with the restaurant primarily and substantially engaged in the preparation and service of food.

20. The proposed location has a capacity for approximately 200 dining patrons and approximately 20 bar patrons.

21. On January 21, 1993, Tra-Kim, Inc. was incorporated, with Petitioner as sole shareholder and President, George F. Poston as Vice President, and Tricia B. Salter, Petitioner's wife, as Secretary/Treasurer.

22. In 1993, George F. Poston, as Vice President of Tra-Kim, Inc., applied for a beer and wine permit and minibottle license for the proposed location. The issuance of the license and permit was protested, and a contested case hearing was conducted on August 12, 1993. The hearing officer's decision, dated August 16, 1993, was appealed and heard by the S.C. Tax Commission. The March 9, 1994 Order of the Tax Commission was appealed to the Circuit Court. Special Circuit Court Judge Robert A. Smoak heard the appeal and issued an Order dated September 15, 1994. Judge Smoak's decision was appealed to the S.C. Supreme Court. The case is currently pending before the Supreme Court, awaiting oral arguments. Administrative notice is taken of the foregoing information and the above-referenced Orders are incorporated herein by reference; however, because a final conclusive determination has not been reached in the case, no findings of fact or conclusions of law contained in those Orders are accepted as conclusive or relevant in the present case.

23. The parties stipulate that the sole issue in controversy in the case pending before the Supreme Court is the application of S.C. Code Ann. § 61-1-95 (1976) and determination of the impact of Petitioner's real property ownership interest in the proposed location at the time Rose Z. Salter's license and permit were revoked in 1989. Suitability of the proposed location is not an issue.

24. Administrative notice is taken of the fact that S.C. Code Ann. § 61-1-95 (1976) was amended by Act 413 of 1995, effective June 13, 1995.

25. Several witnesses testified as to Petitioner's moral character.

26. No evidence was presented to indicate that Petitioner was personally involved in the racially discriminatory practices conducted at the Buffalo Room while previously licensed, nor was any evidence offered to establish that Petitioner condoned or condones racial discrimination in any fashion or would operate the proposed location with any type of discriminatory practices or policies.

27. Petitioner was convicted of Driving Under the Influence on July 6, 1990.

28. Randy David Salter has prior criminal convictions for drug offenses.

29. Petitioner is over twenty-one years of age, is a citizen of the State of South Carolina, and has maintained his principal residence in South Carolina for more than thirty days.

30. Petitioner has never had a permit/license revoked.

31. Petitioner is of good moral character.

32. Notice of the application appeared in a newspaper of general circulation in the area of the proposed location for three consecutive weeks and was posted at the proposed location for fifteen days.

33. The proposed location is located within the municipality of North Augusta.

34. The proposed location is not located within three hundred feet of a school, church, or playground.

35. There being no evidence to the contrary, the proposed location is a suitable one for the sale and consumption of beer, wine, and liquor.

36. Petitioner stipulates that he will change the name of the proposed location, so that it will no longer be called the Buffalo Room.

37. Petitioner stipulates that Rose Z. Salter and Bruce H. Salter will not be involved in the operation of the proposed location.

38. Petitioner stipulates that Randy David Salter will not be involved in the operation of the proposed location, although Petitioner does not stipulate to prohibit Randy David Salter from being on the premises of the proposed location.

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

1. The South Carolina Administrative Law Judge Division is empowered to hear this case pursuant to S.C. Code Ann. § 61-1-55 (Supp. 1995) and Chapter 23 of Title I of the 1976 Code, as amended.
2. Petitioner meets the criteria set forth in S.C. Code Ann. § 61-9-320 (Supp. 1995), the requirements to be met before issuance of a beer and wine permit.

1. Petitioner meets the criteria set forth in S.C. Code Ann. §§ 61-5-50 and 61-3-440 (Supp. 1995), the requirements for a business sale and consumption minibottle license.
2. As the trier of fact, an administrative law judge is authorized to determine the fitness or suitability of the proposed business location of an applicant for a permit to sell beer and wine using broad but not unbridled discretion. Ronald F. Byers v. S.C. ABC Commission, 281 S.C. 566, 316 S.E.2d 705 (Ct. App. 1984).
3. Under the doctrine of collateral estoppel, when an issue of fact or law is actually litigated and determined by a valid and final decision of an administrative tribunal, and that determination is essential to the decision, the determination is conclusive in a subsequent matter between the parties, whether on the same or different claim. Carman v. S.C. ABC Commission, ___ S.C. ___, 451 S.E.2d 383 (1994); St. Philip's Episcopal Church v. S.C. ABC Commission, 285 S.C. 335, 329 S.E.2d 454 (Ct. App. 1985).
4. Petitioner's parents, Rose Z. Salter and Bruce H. Salter, had a full and fair opportunity to litigate whether they possessed the moral character to hold a beer and wine permit and liquor license and were found to lack the requisite moral character in a final and binding decision of the ABC Commission, by Order dated October 24, 1989.
5. The parties are collaterally estopped from relitigating the moral character of Rose Z. Salter and Bruce H. Salter, as the issue was necessarily and specifically determined in the ABC Commission's revocation Order dated October 24, 1989.
6. As the matter is currently pending review by the South Carolina Supreme Court, a valid and final decision and conclusive judgment has not been rendered in the 1993 George Poston application case regarding George F. Poston, James David Salter, and Tra-Kim, Inc. Accordingly, collateral estoppel does not apply to the issues litigated in that case.
7. Because S.C. Code Ann. § 61-1-95 was amended subsequent to the filing of the Poston application, but prior to Petitioner's application, the decision of this Court in the present case may render the Poston case moot; otherwise, this Court would be inclined to stay the proceedings in the present case to allow the Supreme Court to conclusively decide the Poston application case.

1. Under S.C. Code Ann. § 61-1-95 (1976), Petitioner would have been ineligible to hold a beer and wine permit or liquor license for the proposed location pursuant to the following provisions of the statute:

When a license or permit is suspended or revoked, no partner or person with a financial interest of any kind in the business or premises, nor a person within the third degree of kinship to the person to whom a license has been issued, may be issued a license or permit for the premises concerned.

1. With the enactment of 1995 Act No. 143, effective June 13, 1995, § 61-1-95 was amended, in pertinent part, as follows:

When a license or permit is suspended or revoked, no partner

or person with a financial interest of any kind in the business

or premises, may be issued a license or permit for the premises

concerned. nor a No person within the third second degree of

kinship to the a person to whom a license has been issued whose

license or permit is suspended or revoked may be issued a license

or permit for the premises concerned for a period of one year after

the date of suspension or revocation.

S.C. Code Ann. § 61-1-95 (Supp. 1995).

1. Petitioner is within the second degree of kinship to Rose Z. Salter and Bruce H. Salter; however it has been more than one year since the revocation of their license and permit.
2. At the time of revocation of Rose Z. Salter's and Bruce H. Salter's license and permit for the Buffalo Room in 1989, Petitioner possessed an ownership, and therefore financial, interest in the premises of the subject licensed location, but did not possess a financial interest in the business, Salter Enterprises, Inc., which operated the Buffalo Room.
3. It is clear to this Court that the General Assembly, by deleting the term "or premises" from the first sentence of the third paragraph of S.C. Code Ann. § 61-1-95, through enactment of 1995 Act No. 143, intended to remove as a disqualifying criterion for licensure, an applicant's mere property ownership interest in the proposed location at a time when a previous license for the same location was revoked.
4. Acts or crimes of moral turpitude imply the absence of good moral character. 1989 Op. S.C. Att'y. Gen. No. 88-89.

1. A crime of moral turpitude involves "an act of baseness, vileness or depravity in the private and social duties that a man owes to his fellow man or to society in general, contrary to the accepted and customary rules of right and duty between man and man...." Smith v. Smith, 194 S.C. 247, 259 S.E.2d 584 (1940).
2. Driving under the influence is not considered a crime of moral turpitude. State v. Hall, 306 S.C. 293, 411 S.E.2d 441 (Ct. App. 1991).
3. With the imposition of certain restrictions to ensure that the past racially discriminatory practices of Petitioner's family members are not resumed or repeated, Petitioner is suitable and fit to hold a beer and wine permit and liquor license for the proposed location.
4. 23 S.C. Code Ann. Regs. 7-88 (1976) authorizes the imposition of restrictions to a permit incorporating any stipulated restrictions into the basic requirements for the enjoyment and privilege of obtaining and retaining the permit.
5. Permits and licenses issued by the State 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. As the tribunal authorized to grant the issuance of a permit is also authorized, for cause, to revoke it, that tribunal is likewise authorized to place restrictions or conditions on the permit or license. See Feldman v. South Carolina Tax Commission, 203 S.C. 49, 26 S.E.2d 22 (1943).

IT IS THEREFORE ORDERED that the license and permit sought are granted, subject to restriction upon the Petitioner signing a written agreement to be filed with DOR to adhere to the restrictions stipulated to and set forth below:

1. The licensed location must not use the name, or do business as,

the "Buffalo Room."

2. Rose Z. Salter, Bruce H. Salter, and Randy David Salter are

prohibited from having any involvement with the management,

operation, supervision, or control of the licensed location.

3. Except for the existing mortgage on the property, Rose Z. Salter

and Bruce H. Salter are prohibited from having any financial or

ownership interest in the premises or business of the licensed

location.

4. Rose Z. Salter and Bruce H. Salter are prohibited from being on

the licensed premises at any time during its hours of operation.

IT IS FURTHER ORDERED that a violation of any of the above conditions is considered a violation against the permit and may result in a fine, suspension, or revocation.

AND IT IS SO ORDERED.

_______________________________________

STEPHEN P. BATES

ADMINISTRATIVE LAW JUDGE

February 26, 1996

Columbia, South Carolina