South Carolina              
Administrative Law Court
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SC Administrative Law Court Decisions

CAPTION:
DOR vs. CAANCA, Inc., d/b/a Andrews Private Club

AGENCY:
South Carolina Department of Revenue

PARTIES:
Petitioner:
South Carolina Department of Revenue

Respondent:
CAANCA, Inc., d/b/a Andrews Private Club
 
DOCKET NUMBER:
03-ALJ-17-0258-CC

APPEARANCES:
Dana R. Krajack, Esquire for the Department of Revenue

Steve Patterson, Pro Se, for CANNCA, Inc.

J. Calhoun Pruitt, Jr., Esquire, Attorney of Record for the Respondent was not present
 

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. §61-2-260 (Supp. 2002). The South Carolina Department of Revenue (Department) seeks revocation of the Respondent’s sale and consumption license and a fine of $500.00. A hearing was held before me on September 23, 2003 at the offices of the Division in Columbia, South Carolina.

At the call of the case, the Petitioner’s attorney submitted a consent order signed by the attorney for the Petitioner, the attorney for the Respondent and the manager of the Respondent corporation, requesting that J. Calhoun Pruitt, Jr. be relieved as counsel for the Respondent, that the hearing not be postponed, and that the Respondent be allowed to proceed pro se. The proposed order had been sent to the Department of Revenue by Mr. Pruitt on September 16, 2003. Upon receipt of the proposed order, the Court recessed and attempted to call Mr. Pruitt to determine why he had not contacted the court, or made a motion to be relieved as counsel under Rule 8(c) of the Rules of Procedure for the Administrative Law Judge Division. Mr. Pruitt was not in his office. His assistant later called back to the Division to state that Mr. Pruitt had submitted an order to the opposing counsel asking to be relieved as counsel. To date, this court has not been notified by written motion or by telephone call from Mr. Pruitt of his request to withdraw from representation of the Respondent.

Following the inability of the court to contact Mr. Pruitt, the court reconvened and conducted an examination of Mr. Patterson to ensure that he voluntarily waived his right to counsel and that his case would not be prejudiced by continuing pro se. The court was satisfied that due to the costs of having Mr. Pruitt travel to the hearing in Columbia, and the fact that Mr. Patterson was familiar with the facts of the case, the waiver of counsel was voluntary and that the Respondent’s case would not be prejudiced by continuing pro se. The court signed the proposed order relieving Mr. Pruitt as counsel for the Respondent. The Court, however, takes this opportunity to counsel attorneys before the Division of the Rules of Procedure of the Division, and ability of this court to impose fines and/or sanctions for violation of these Rules.


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, CAANCA, Inc., d/b/a Andrews Private Club (Andrews), is the holder of a beer and wine permit and a sale and consumption license of alcoholic liquors (minibottle) for a nonprofit private club located at 3442 Cinema Center, Anderson, South Carolina. Footnote

3.On January 25, 2003, agents of the South Carolina Law Enforcement Division (SLED) performed an undercover inspection of Andrews. Agent Boling, now Branham (Branham), Agent Causey, Agent Pope and others went to the shopping center where Andrews and two other private clubs are located. Agent Branham approached the entrance to Andrews. When she entered the club, she was alone. Mr. Patterson, the manager of Andrews, testified that there were several people milling around in the foyer of the club, which is inside the front door of the club, but not yet inside the actual club. He stated that Agent Branham was in the foyer with a member of the club; the doorman asked the agent if she were a member, and Agent Branham responded that she was not. The doorman then charged her $5.00 as an admission/cover charge and showed her where to sign the register as a guest. Mr. Patterson stated that he thought that she was a guest of the member with whom she had been standing. Andrews’ policy is that if a non-member is with a member and signs the register as a guest, then the assumption is that the non-member is a guest of that member.

4.After entering Andrews, Agent Branham was allowed to purchase Crown Royal,

an alcoholic drink from a mini-bottle, mixed with Coke. Agent Branham paid $5.50 for the drink and consumed a small portion of it. Then, upon exiting the location, she turned over a sample of the drink to Agent Causey. Agent Causey issued a citation to Andrews for “permitting consumption of liquor by a nonmember” which is a violation of Regulation 7-17(J).

5.Andrews has had two previous violations of the laws regulating its nonprofit

organization’s sale and consumption license within three years of January 25, 2003. Both of the previous violations were also for permitting consumption of liquor by a person who is neither a bona fide member or a bona fide guest of a member. Andrews paid an $400.00 fine for the first violation which occurred February 8, 2001, and a $800.00 fine for the second violation which occurred on October 26, 2001. On May 19, 2003, the Department issued a Final Determination letter based on the current incident, revoking Andrews’s sale and consumption (minibottle) license for the January 25, 2003 violation, and imposing a $500.00 fine. There was no penalty imposed against the beer and wine permit.

6.The Department submitted Requests to Admit to Andrews prior to the hearing.

Andrews admitted that the bartender at Andrews did sell Agent Branham a Crown and Coke [sic] on January 25, 2003, and that she was not a member of Andrews. Andrews denied that Agent Branham was not a bona fide guest of a member on January 25, 2003. The Requests to Admit were admitted as Petitioner’s exhibit number one.


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. 2002). S.C. Code Ann. § 1-23-600 (1986 & Supp. 2002) grants jurisdiction to the Division to hear contested cases under the Administrative Procedures Act. Specifically, S.C. Code Ann. § 61-2-260 (Supp. 2002) grants the Division the authority to hear contested case hearings in matters governing alcoholic beverages.

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.Andrews holds a sale and consumption license as a “nonprofit organization.” S.C. Code Ann § 61-6-20 (6) (Supp. 2002) 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. 2002). Here, the Respondent permitted Agent Branham, 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. Andrews asserts that this tribunal has the discretion to impose a monetary penalty in lieu of revocation if the court finds that the evidence supports that determination. S.C. Code Ann. § 61-6-2600 (Supp. 2002) 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 . . . .”

The primary purpose of this statute is the control of minibottles. The statute specifically references that the transportation, possession or consumption of alcohol in any manner other than that authorized, as well as the possession of alcohol in containers other than minibottles, or the display of minibottles with broken seals is an offense which is punishable as stated above. The Department’s reliance on S.C. Code Ann. § 61-6-2600 seems to refer on the “catch-all” phrase in that section which, after specific references to actions that a licensee shall not engage in, states “a person licensed to sell alcoholic liquors . . . who violates any other provision of this article must . . .” then the penalties are stated. The provision that Andrews is accused of violating is Regulation 7-17, not a provision of the statute. If the legislature had intended the automatic revocation to apply to the sale of alcohol to non-members of a non-profit private club, then it would have included such in its list of prohibited activities. This violation is contained in the Department of Revenue’s regulations which are promulgated by the Department. That language is not incorporated in the statute.

On the other hand, S.C. Code Ann. § 61-6-4270 (Supp. 2002) provides that a monetary penalty may be imposed as an alternative to revocation or suspension in all cases in which revocation or suspension is authorized, or “for a violation of any regulation pertaining to alcoholic liquors.” (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. 2002) (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”). Since penal statutes are strictly construed against the State and any doubt must be resolved in favor of the Respondent, Footnote I find that this tribunal has discretion to impose a monetary penalty, since that is expressly provided for in § 61-6-4270.

ORDER

Based upon the foregoing Findings of Fact and Conclusions of Law, IT IS HEREBY ORDERED that the Respondent pay an $1000.00 fine to the Department within thirty (30) days from the date of this Order. No action shall be taken against the Respondent’s beer and wine permit or sale and consumption license.

AND IT IS SO ORDERED.

___________________________________

CAROLYN C. MATTHEWS

Administrative Law Judge


January 13, 2004

Columbia, South Carolina


Brown Bldg.

 

 

 

 

 

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