ORDERS:
ORDER AND DECISION
This matter comes before the Administrative Law Judge Division for a hearing on a
citation issued by the Department of Revenue and Taxation (Department) against Ronnie
McDuffie for a violation of Regulation 7-17(J) permitting the consumption of alcoholic beverages
by a non-member on or about March 18, 1994. After notice to the parties, Mr. McDuffie failed to
appear at the hearing. Instead, Mr. Rudolph Hammock, the president of Varsity III appeared to
contest the violation and the sanction sought by the Department. The hearing was conducted on
September 12, 1994. After reviewing the testimony and evidence presented, I make the
following:
FINDINGS OF FACT
1. On March 18, 1994, Russell Feaster, an Alcohol Enforcement Unit officer entered
the Varsity III club located on Main Street in Columbia, South Carolina. The front entrance was
unattended and Agent Feaster walked to the bar. He ordered a Crown Royal and Coke mixed
alcoholic beverage and paid the bartender $4.00. He consumed a portion of the drink and then
saved a sample of it. He was not asked for any identification or any questions to determine his
membership status with the club.
2. The Varsity III, Inc. is a private club for the social entertainment of its members.
The constitution and by-laws of the club are dated October 15, 1987. The club first applied for a
minibottle license in 1987 which was issued by the South Carolina Alcoholic Beverage Control
Commission (Commission).
3. The license had been renewed by the Commission or the Department since its
issuance in 1987. The Board of Directors of the club had also changed. In fact, the officers
changed frequently in The Varsity III, Inc.
4. Pursuant to the certified records of the Department, there are three prior violations
issued against The Varsity III, two occurring in 1992 when Mr. Willie Newman was Secretary of
the organization and held the license in his name; and in 1993, one against Ronnie McDuffie,
Secretary and holder of the license. Two of these violations involve the sale of alcoholic
beverages to a non-member in violation of the regulations promulgated by the Commission.
5. Rudy Hammock, president, admitted to the violation occurring on March 18,
1994. He disputes the prior violations occurring in 1992 because he was not on the Board and
had no knowledge of those violation. He became a member of the Board of Directors in 1992.
He disputes that a board existed before 1992. The copy of bylaws submitted by Hammock are
not complete and are not signed. This evidence is not supported by the certified copies of signed
documents presented by the Department from its application file showing the club existed in 1987.
CONCLUSIONS OF LAW
1. Section 1-23-600 grants jurisdiction to the Division to hear contested cases under
the Administrative Procedures Act. S.C. Code of Laws § 1-23-600 (Supp. 1993).
2. S.C. Code of Laws § 61-1-55 (Supp. 1993) grants to the Division the powers,
duties and responsibilities as a hearing officer in protested and contested matters governing
alcoholic beverages, beer, and wine.
3. The "Government Restructuring Act of 1993" provides that all regulations
promulgated by the Commission effective on the date of the act remain in force until modified or
rescinded by the Department or the State Law Enforcement Division. 1993 Act No. 181 §1604.
4. Commission Regulation 7-17 (J) provides: "Only bona fide members and bona fide
guests of member of such organizations may consume alcoholic beverages sold in sealed
containers of two ounces or less upon the licensed premises."
5. Pursuant to Regulation 7-2(H), a new mini-bottle license is not required if an
officer or manager of the corporation is replaced by a different individual. Regulation 7-2 (I)
states, "corporations and other similar organizations are responsible for all violations which occur
on the premises licensed pursuant to Article 1 of Chapter 5 of Title 61 of the 1976 Code, in
addition to the individual who holds the license for the use of such organizations. This regulation
is intended to prevent the avoidance of penalties by securing permits or licenses in different
officer's or manager's names as all violations must be settled prior to the issuance of another
permit or license for the use of such organizations."
6. Section 61-5-20 (3) provides, among other things, that members or guests of
members of non-profit organizations may consume alcoholic liquors and beverages sold in mini-bottles upon the premises.
7. It is clear that the regulations impose upon the board of directors responsibility for
any violations issued against a permit or license which is used for the benefit of the organization.
Even though the current board may not have direct knowledge of the previous violations by Willie
Newman, Newman held the license for the benefit of the club and any wrongdoing attributed to
the licensee is also attributed to the board.
8. The evidence clearly reveals there were three prior violations in a two year period.
Two of these violations involve the same regulation at issue in the current case. Based upon the
prior violations the Department is seeking permanent revocation of the license under S.C. Code
§61-5-110. This section provides both civil and criminal penalties for violating provisions of
Article 1, Chapter 5, Title 61 and regulations promulgated to enforce the provisions of that
article. For the third offense within three years of the first offense, the fine is $500 and the
permanent revocation of the license. S.C. Code of Laws §61-5-110 (3) (1976).
ORDER
Based upon the Findings of Fact and Conclusions of Law, Ronnie McDuffie violated the
provisions of Regulation 17-7. The Varsity III. Inc., had knowledge of the violation and is a
responsible party under Regulation 7-2. This is the third offense for violating Regulation 17-7(J)
within a three year period. THEREFORE, IT IS
ORDERED pursuant to Section 61-5-110, that the mini-bottle license issued to Ronnie
McDuffie used on behalf of and for the benefit of The Varsity III is hereby permanently
REVOKED.
AND IT IS SO ORDERED.
_______________________________
ALISON RENEE LEE
Administrative Law Judge
September _____, 1994
Columbia, South Carolina |
