ORDERS:
FINAL ORDER AND DECISION
STATEMENT OF THE CASE
This matter comes before the Administrative Law Judge Division (Division) pursuant to
S.C. Code Ann. §§ 61-2-20 and 61-2-260 (Supp. 2001). The South Carolina Department of
Revenue (Department) seeks revocation of the Respondent’s sale and consumption license and a
fine of $500.00. The Department also seeks revocation of the Respondent’s beer and wine
permit, pursuant to Revenue Procedure 95-7. A hearing was held before me on September 3,
2003 at the offices of the Division in Columbia, South Carolina.
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 persuasion by the parties, I make the
following Findings of Fact by a preponderance of the evidence:
1.Notice of the time, date, place and subject matter of the hearing was given to the
Petitioner and the Respondent.
2.The Respondent, Florence County Benevolent Society d/b/a Rum Jungle (Rum
Jungle), is the holder of a beer and wine permit for a nonprofit organization and sale and
consumption license of alcoholic liquors for its establishment located at 1804 ½ W. Palmetto
Street, Florence, South Carolina.
Stipulation of Facts
3.Prior to the hearing into this contested case, the parties agreed in writing to the
following facts surrounding this violation:
“That on May 4, 2002, at approximately 12:20 a.m., SLED Special Agent Steve Wright
entered the business known as the “Rum Jungle” operating at 1804 ½ West Palmetto Street in
Florence, South Carolina, which is a private club for the sale and consumption of alcoholic liquor
under DOR license #32013189-PSC and for the sale of beer and wine under license #32013189-PBW. Before entering, an employee of the business identified as Kevin Edwards checked the age
of Agent Wright, but failed to inquire whether Agent Wright was either a member or the guest of
a member of Rum Jungle but was permitted to enter Rum Jungle. Upon entering, Agent Wright
ordered a bourbon and coke from Jessica Edgarton, the bartender. Agent Wright observed
Jessica Edgarton mix and serve him the liquor drink without any questions regarding his
membership status. Agent Wright consumed a small portion of the liquor drink inside the Rum
Jungle within three feet from Jessica Edgarton.
That the Respondent had received prior citations for violations of Regulation 7-17(J) on
April 6, 2000 and October 25, 2001, within three years of the date of this offense.”
SLED issued Rum Jungle a citation for permitting consumption of liquor by a nonmember,
pursuant to 23 S.C. Code Ann. Regs. 7-17(J) (Supp. 2001).
4.Rum Jungle has two previous violations of the laws regulating its sale and
consumption license as a nonprofit organization within three years of May 4, 2002. Both of those
violations were for permitting consumption of liquor by a person who is neither a bona fide
member or a bona fide guest of a member. Rum Jungle previously paid a $500.00 fine for the first
violation and a $1,000.00 fine for the second violation. On July 11, 2002, the Department
revoked Rum Jungle’s sale and consumption license and beer and wine permit for the May 4,
2002 violation, and imposed a $500.00 fine.
Mitigating Evidence
5.Mike Timmons, the President of the Florence County Benevolent Society d/b/a
Rum Jungle, has operated this location for approximately thirteen (13) years. He is also the
President of another nonprofit organization located in the Florence area known as “Daddy-O’s”
which has been in operation for approximately two (2) years with no violations. Although Mr.
Timmons is usually present at the location and had been earlier on the night in question, he was
away from the business for a brief period of time when this violation occurred. His regular
doorman, Timothy Hastings, was also out on that night due to an ankle injury. Nevertheless, Mr.
Timmons specifically instructed another individual on how to properly handle the door prior to his
leaving the premises. Though that individual had not previously “worked the door,” Mr.
Timmons also instructed the location’s manager to watch this individual. When he returned, this
violation had occurred.
Immediately following this violation and on the same night, Mr. Timmons fired both the
doorman and the manager of Rum Jungle. Also subsequent to this violation, Mr. Timmons placed
a very visible sign outside the location that sets forth: “No Membership? No Entry! No
Exceptions! S.C. State Law.” A new policy was also developed for the door to ensure two layers
of protection: one individual checks the outer door for membership and guests of members while
another individual at the second entryway to the location double checks membership and age.
This location also has a new data base at its entrance to ensure an accurate membership check.
Finally, in the past few years, the atmosphere of this location has been geared more toward an
older crowd with Mr. Timmons hiring more experienced and mature employees to control the
door.
Additionally, Mr. Timmons has contacted SLED Agent Lonnie Roberts during his
operation of the location on numerous occasions seeking advice on how to comply with the laws
governing his license and he has consistently followed Agent Roberts’ suggestions. Mr. Timmons
has also had Agent Roberts come to his location to train his staff before this incident. Agent
Roberts testified that it is unusual for licensees to exhibit the interest shown by Mr. Timmons in
determining the correct procedures to follow. Furthermore, Agent Roberts has visited the
location since the May 4, 2002 violation at the behest of Mr. Timmons to discuss and suggest
improvements that could be made at the location to thwart future violations. Those suggestions
have also been followed. Rum Jungle has had no violations since the May 4, 2002 violation even
though SLED has inspected Rum Jungle for violations.
CONCLUSIONS OF LAW
Based upon the above Findings of Fact, I conclude the following as a matter of law:
1.The Department is vested with the authority to administer the provisions of Title
61 governing alcoholic beverages, beer and wine. S.C. Code Ann. § 61-2-20 (Supp. 2001). S.C.
Code Ann. § 1-23-600 (1986 & Supp. 2001) grants jurisdiction to the Division to hear contested
cases under the Administrative Procedures Act. Specifically, S.C. Code Ann. § 61-2-260 (Supp.
2001) grants the Division the authority to hear contested case hearings in matters governing
alcoholic beverages, beer and wine.
2.Permits and licenses issued by this State for the sale of liquor, beer and wine are
privileges to be used and enjoyed only so long as the holder complies with the restrictions and
conditions governing them. See Feldman v. S.C. Tax Commission, 203 S.C. 49, 26 S.E. 2d 22
(1943).
3.Rum Jungle holds a sale and consumption license as a “nonprofit organization.”
S.C. Code Ann § 61-6-20 (6) (Supp. 2001) provides that a “nonprofit organization” is “an
organization not open to the general public, but with a limited membership and established for
social, benevolent, patriotic, recreational, or fraternal purposes.” Nonprofit organizations which
are licensed by the Department under this article may sell alcoholic liquors in minibottles.
Furthermore, only “bona fide members” or “bona fide guests of members of [nonprofit]
organizations may consume alcoholic beverages sold in sealed containers of two ounces or less
upon the licensed premises.” 23 S.C. Code Ann. Regs. 7-17 (J) (Supp. 2001). Here, the
Respondent permitted Agent Wright, who was neither a “bona fide member” nor a “bona fide
guest of a member,” to consume an alcoholic beverage upon its premises in violation of
Regulation 7-17(J).
The Department contends that a sale and consumption license must be revoked upon
conviction of a third offense within three years. The Department also argues that the
Respondent’s beer and wine permit must also be revoked in accordance with Revenue Procedure
95-7. Finally, the Department seeks a $500.00 fine against the Respondent for this third violation.
The Respondent contends that this tribunal has the discretion to impose a monetary penalty in lieu
of revocation if it finds that the evidence supports that determination. S.C. Code Ann. § 61-6-2600 (Supp. 2001) provides that “a person licensed to sell alcoholic liquors pursuant to the
provisions of this article who . . . violates any . . . provision of this article must:
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(3) for a third offense within three years of the first offense be fined not less than
five hundred dollars and have his license revoked permanently . . . .”
On the other hand, the Respondent contends that this tribunal has the discretion to impose a
monetary penalty in lieu of revocation if it finds that the evidence supports that determination.
S.C. Code Ann. § 61-6-4270 (Supp. 2001) sets forth:
For violations of Articles 3, 5, 7, and 13 of this chapter, or of Chapter 21 or 33 of
Title 12, and for a violation of any regulation pertaining to alcoholic liquors, the
department may, in its discretion, impose a monetary penalty upon the holder of a
liquor license in lieu of suspension or revocation.
(Emphasis added).
The primary rule of statutory construction is to ascertain and give effect to the legislature's
intent. Green v. Thornton, 265 S.C. 436, 219 S.E.2d 827 (1975). In ascertaining the legislature's
intent, statutes that are part of the same act must be read together. Burns v. State Farm Mut.
Auto. Ins. Co., 297 S.C. 520, 377 S.E.2d 569 (1989). Furthermore, “[e]ach part of a statute
should be given effect and each word given its plain meaning if this can be accomplished by any
reasonable construction.” Sea Island Scenic Parkway Coalition v. Beaufort County Bd. of
Adjustments and Appeals, 316 S.C. 231, 236, 449 S.E. 2d 254, 257 (Ct. App. 1994). Moreover,
this tribunal must reconcile conflicts if possible and is obligated to avoid a construction that would
read a provision out of a statute. Steinke v. South Carolina Dept. of Labor, Licensing and
Regulation, 336 S.C. 373, 520 S.E.2d 142 (1999); see also S.C. Code Ann. § 61-6-4000 (Supp.
2001) (providing that Article 13 of Title 61, which includes § 61-6-4270, is complementary to and
not in conflict with existing laws governing the sale of “beer, wines, and other vinous, fermented,
or malt liquors”).
Presuming that the application of the rules of statutory construction is warranted in this
case, the most reasonable construction which gives effect to both Sections 61-6-2600 and 61-6-4270 is that this tribunal has discretion to impose a monetary penalty, whenever the provisions of
Articles 3, 5, 7, and 13 of Title 61 set forth that the Department may revoke or suspend a license
or permit held under those provisions. On the other hand, when a licensee commits a third offense
within three years under Article 5, the license must be mandatorily revoked. Nevertheless, the
most reasonable construction is not always applied in enforcement actions by the Department
because if a penal statute is ambiguous, it is strictly construed against the State and any doubt
must be resolved in favor of the Respondent. Gateway Enterprises, Inc. v. South Carolina
Department of Revenue, 341 S.C. 103, 533 S.E.2d 896 (2000). However, in this case, I am not
making any finding concerning the construction of these statutes because I find that Section 61-6-2600 is inapplicable to this case.
Section 61-6-2600 sets forth that a person who violates a “provision” of Article 5 must
have their license revoked. However, the Respondent did not violate a provision of Article 5.
Rather, the Respondent violated 23 S.C. Code Ann. Regs. 7-17 (J) (Supp. 2001). S.C. Code
Ann. § 61-6-1830 (Supp. 2001) sets forth the penalties for violation of the Department’s
regulations. It provides that:
The department may suspend, revoke, or refuse to renew a license issued pursuant to
subarticle 1 of this article upon finding that:
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(2) the applicant has violated since the issuance of the license any regulation.
(Emphasis added). If there is any ambiguity between Section 61-6-2600 and 61-6-1830, the
interpretation of the meaning of those provisions must be strictly construed against the State and
any doubt must be resolved in favor of the Respondent. Moreover, “[a] specific statutory
provision prevails over a more general one.” Wooten ex rel. Wooten v. S.C. Dep’t of Transp.,
333 S.C. 464, 468, 511 S.E.2d 355, 357 (1999). Section 61-6-1830 expressly addresses the
penalties for violations of the regulations by Article 5 licensees. Moreover, Section 61-6-4270
also specifically provides that a monetary penalty may be imposed in lieu of revocation for a
violation of the Department’s regulations. Accordingly, both 61-6-4270 and 61-6-1830 contain
permissive language to allow the Department to utilize discretion in its decision-making process
to determine the appropriate penalty. Therefore, I find that the Department and consequently the
Division possesses the discretion to impose a monetary penalty in lieu of revocation for a violation
of Regulation 7-17 (J) by an Article 5 licensee.
Sanction
4.The Administrative Law Judge Division, as the trier of fact in contested cases
under the Administrative Procedures Act, has the authority to establish the facts supporting the
imposition of a penalty for a violation. Inherent in and fundamental to the quasi-judicial powers
of an Administrative Law Judge is the authority to decide the appropriate sanction when such is
disputed. Walker v. South Carolina ABC Comm’n, 305 S.C. 209, 407 S.E. 2d 633 (1991). To
that end, the Administrative Law Judge must consider relevant evidence presented in mitigation.
Mitigation is defined as a lessening to any extent, great or small. It may be anything between the
limits of complete remission on the one hand and a denial of any relief on the other. In a legal
sense, it necessarily implies the exercise of the judgment of the court as to what is proper under
the facts of the particular case. 58 C.J.S. Mitigation p. 834-835 (1948). A legitimate as well as a
significant consideration is whether the alleged mitigating factor demonstrates reasonable cause to
reduce the penalty. Kroger Co. v. Department of Revenue, 673 N.E. 2d 710 (Ill. 1996).
I find that consideration of the mitigating evidence is justified in determining the
appropriate sanction for the Respondent’s violation of Regulation 7-17(J). I further find that in
light of the fact the Respondent has only been monetarily fined for his previous two violations and
has made extensive efforts both before and after his previous violations to insure that further
violations do not occur, that a thirty (30) day suspension of the Respondent’s sale and
consumption license is the appropriate penalty for this violation of Regulation 7-17 (J). However,
I strongly caution the Petitioner that further violations may result in permanent revocation.
ORDER
Based upon the foregoing Findings of Fact and Conclusions of Law, IT IS HEREBY
ORDERED that the Respondent’s sale and consumption license is suspended for thirty (30) days
from the date of this Decision.
AND IT IS SO ORDERED.
___________________________
Ralph King Anderson, III
Administrative Law Judge
September 9, 2003
Columbia, South Carolina |
