ORDERS:
ORDER AND DECISION
STATEMENT OF THE CASE
This matter comes before the Administrative Law Judge Division pursuant to an
administrative violation issued by the South Carolina Department of Revenue and Taxation
(Department) against the retail liquor license of William N. Massalon (Respondent), d/b/a Bill's ABC
Store, located on Highway 21, in the Island Square Shopping Center, Ladys Island, Beaufort County,
South Carolina (location). The citation was issued to the Respondent on July 5, 1995, for a violation
of S.C. Code Ann. § 61-3-1000 (Supp. 1994)(section 61-3-1000) for failing to maintain not more
than two means of public ingress and egress. The Department seeks a suspension of the retail liquor
license for fifteen days.
The Respondent made a timely request for a contested case hearing on this charge and a
contested case hearing was held at the Administrative Law Judge Division offices, 1205 Pendleton
Street, Columbia, South Carolina, on November 21, 1995.
EXHIBITS
The parties stipulated to the following being placed into the record:
1. Sketch of the interior of the location (Petitioner's Exhibit #1);
2. Violation report dated July 5, 1995 (Respondent's Exhibit #1); and
3. Photographs of the interior and exterior of the location (Respondent's Exhibits #'s
11-17).
Respondent also placed into the record as evidence the following exhibits:
1. Letter from Respondent to the South Carolina ABC Commission dated October
12, 1990 (Respondent's Exhibit #2);
2. Letter from Respondent to the South Carolina ABC Commission dated December
6, 1990 (Respondent's Exhibit #4);
3. Invoice from Unique Welding dated June 7, 1991, for a frame (Respondent's
Exhibit #7);
4. Retail licenses to Petitioner for the location and check dated June 7, 1991,
made payable by Bill's Liquor Store, Inc., to Unique Welding (Respondent's Exhibit #8).
SUMMARY OF THE EVIDENCE
Ryan Anthony Neill, a special agent with the Alcohol Enforcement section of the Department
since March 3, 1995, testified that he is familiar with the interior and exterior of the location. Further,
after he received a complaint about the interior design at Respondent's location from a competitor
of the Respondent, he contacted his superiors and subsequently wrote the violation report. He
acknowledged that before an applicant can obtain a license for a retail liquor store, the location must
be inspected by a State Law Enforcement Division (SLED) officer assigned to the Department for
licensing purposes. He further acknowledged that he was not aware of the gate as shown in
Respondent's Exhibit #13 (between the wine cellar and party shop). He stated that the Respondent
had been cooperative in the investigation.
Ms. Jody Plyler, now employed with the Alcoholic Beverage Control section of the
Department as secretary to Patricia Stites, and formerly employed in the same capacity with the South
Carolina Alcoholic Beverage Control Commission (Commission), acknowledged that when the
licenses were granted to Respondent in early 1991, proposed locations had to be inspected prior to
licensing. She further testified that there were approximately 50 agents assigned for licensing and
enforcement at the time Respondent's licenses were granted.
Respondent testified that he started construction at the location in July 1990 and filed the
application, including plans of the building, with the Commission. He stated the notice of the
application for the store was posted on a tree at the location by a South Carolina Law Enforcement
Division (SLED) agent. The SLED agent, Gene Collins, made several trips to the location during
the store's construction, as did another SLED agent. Respondent testified that he received letters of
approval from the Commission for the location and the building structure. Respondent further
testified that the store opened in February 1991 after the granting of both licenses (Respondent's
Exhibit #8). He stated the store was designed by an architect.
Respondent further stated that since the opening of the location, SLED agents attached to the
Commission and the Department have visited the location dozens of times. Some of those agents
included Chief Dorton, Golie Augustus, Terry Lee and Wally Scott. Further, Respondent stated that
no agent has ever suggested or told him that the interior walls and doorways were in violation of any
law in South Carolina. He stated he put up the bars or gates on the two interior doors into the wine
cellar when told to do so in June 1991 by agent Golie Augustus.
FINDINGS OF FACT
After consideration and review of all the testimony and the evidence submitted at the hearing,
by a preponderance of the evidence, I make following findings:
1. This Division has personal and subject matter jurisdiction.
2. Notice of the date, time, place and nature of the hearing was timely given to all parties.
3. The Respondent, William N. Massalon, owns a party shop and a retail liquor store
located at Highway 21, Island Square Shopping Center, Beaufort County, South Carolina. The
location was designed by an architect and constructed between July 1990 and February 1991.
4. A permit and license were issued to the party shop and the retail liquor store by the
Commission, effective February 15, 1991.
5. The Commission and SLED agents who inspected the location during its construction
were aware of the interior configuration prior to the issuance of the permit and license. A sketch with
plans showing the layout of the interior was provided to the Commission along with the applications.
6. The permit at the party shop allows for the sale of beer and wine for off-premise
consumption. The license at the retail liquor store permits the retail sale of liquor and wine.
7. The photographs (Respondent's Exhibits #11-17) clearly depict the interior of the
location. There are two glass doors opening from the front sidewalk to an entrance foyer. One may
then proceed to the right into the party shop, or to the left through a door into the liquor store.
8. Both the liquor store and the party shop have a door opening into the wine cellar
location for ingress and egress. In the liquor store, the wall containing the wine cellar door is
adjacent to the wall containing the door into the entrance foyer. Each door opening has a gate which
can be closed to prevent access.
9. Since the opening of the party shop and the retail liquor store, SLED agents attached
to the Commission and now to the Department, inspected the location eight to ten (8-10) times
yearly. No objection was ever made by any of those agents as to any violation of an ABC law or
regulation based upon the location's interior configuration until the violation report dated July 5,
1995.
ANALYSIS AND DISCUSSION
I. Separate Store or Place of Business
The Department seeks a suspension of Respondent's retail liquor license at the Island Square
Shopping Center on Lady's Island, South Carolina. The Department's contention is that Respondent
has failed to comply with the requirements of Section 61-3-1000, which mandates that the means of
ingress and egress for the public must be on the front or adjacent sides at the place of business.
The statute requires that a retail liquor store must be located in "a separate store or place of
business." The use of the words "separate store" would indicate that the Legislature intended two
(2) separate locations or two (2) separate buildings. However, the statute refers not only to a
separate "store," but also to a "place of business." This wording would indicate that the location
need not be housed in a free-standing building. I take judicial notice that there are many retail liquor
stores located in strip shopping centers in South Carolina, each having been authorized by the
Department and its predecessor, the Commission, prior to the issuance of each license. Furthermore,
paragraph four of Section 61-3-1000 authorizes the placement of signs advertising an "ABC Package
Store" in shopping center directories. The statute clearly contemplates that retail liquor stores may
be located either in a free-standing building or in a structure such as a shopping center where other
businesses are located, all under the same roof.
With regard to the configuration of Petitioner's business, it is clear that the liquor store is a
separate "place of business" within the meaning of Section 61-3-1000. Petitioner's retail liquor store
is located in a shopping center, as is the party shop. The two businesses are operated as separate
entities, with separate counters, cash registers and accounting systems. There is a wine cellar located
between the two businesses; it is connected to each business by a door opening. At each of these
door openings is a gate which can be closed and locked. When the law requires the liquor store to
be closed [i.e., July 4th], a store selling only beer and wine may remain open. On such days,
Petitioner closes the liquor store by locking the gate at the wine cellar entrance and by locking the
front door leading into the liquor store.
Section 61-3-1000 provides in pertinent part:
Every retail dealer shall maintain a separate store or place of business with not more
than two (2) means of public ingress or egress which must be on the front or the same
side of the building, except that the doors may be located at the corner of two (2)
adjacent sides of the building. One additional door, not in the front, is allowed to be
used solely for the receipt of commercial deliveries and as an emergency exit.
The statute clearly indicates that either a "separate store" in a free-standing building or a
"place of business" located under the same roof and sharing a common wall with other businesses
may have a front door and a side door for public ingress and egress. In the latter instance, a retail
liquor store could have one door at the front and another door on the wall adjacent to the front door,
which would by necessity open into an adjoining store. In this case, Petitioner operates two separate
businesses, the retail liquor store and the party shop, adjacent to each other. The retail liquor store
has a front door (into the entrance foyer) and a door on the wall adjacent to the front door (the door
opening into the wine cellar). I find nothing in the statute which prohibits this configuration.
Furthermore, where an administrative agency has consistently applied a statute in a particular manner,
its construction should not be overturned absent cogent reasons. Gilstrap v. S.C. Budget and Control
Board, 423 S.E.2d 101 (S.C. 1992). The Commission, which was the public body responsible for
interpreting the laws relating to ABC applications at the time of Petitioner's application, issued a
license to Petitioner after reviewing the plans for the building. Obviously the Commission interpreted
the statute to permit the configuration of doors used in Petitioner's business. Subsequent to the
issuance of the license, the location has been inspected numerous times by Commission and
Department agents, none of whom expressed any concern about the doors until this citation was
issued. These facts are also indicative of the Commission's and the Department's consistent
interpretation of the statute. The Department has failed to advance any rational reason for changing
this interpretation.
II. Estoppel
The essential elements of an equitable estoppel as related to the party claiming the estoppel
are: (1) lack of knowledge and of the means of knowledge of the truth as to the facts in question;
(2) reliance upon the conduct of the party estopped; and (3) the action based thereon was of such a
character as to change prejudicially the position of the party claiming the estoppel. Murphy v. Hagan,
275 S.C. 334, 271 S.E. 2d 311, 313 (1980).
It appears from the record that the Respondent forwarded the sketch or plans for the location
to the Commission, the public body which at that time interpreted the laws relative to ABC
applications. Its agents visited the location on numerous occasions, inspected the premises, and
subsequently issued the liquor license and beer and wine permit. Petitioner justifiably relied upon the
Commission's interpretation of the statute and approval of the plans and designs for the building. He
went to considerable expense to have the building constructed in its present configuration. If the
plans had not been approved, obviously the Petitioner would have constructed the building differently.
To hold, as the Department contends, that the building is suddenly not in compliance with the statute,
after five years of acquiescence, would prejudicially alter the financial position of the Petitioner. He
would be forced to incur additional expense to bring the building into compliance with the
Department's new requirements.
The general rule that the doctrine of estoppel is not to be applied to deny a governmental
agency the due exercise of its police power, South Carolina Department of Social Services v. Parker,
275 S.C. 176, 268 S.E.2d 282 (1980), does not control in this case. "Estoppel is an equitable
doctrine, essentially flexible, and therefore to be applied or denied as equities between the parties may
be preponderate." Pitts v. New York Life Insurance Co., 247 S.C. 545, 148 S.E.2d 369, 371-72
(1966). Government agents, acting within the proper scope of their authority, can by their acts give
rise to estoppel against a municipality. Abbeville Arms v. City of Abbeville, 273 S.C. 491, 257 S.E.
2d 716, 718 (1979). To allow the Department to repudiate its former interpretation of this statute,
based upon a recent reassessment of its meaning, would be unconscionable. Kerr v. City of
Columbia, 232 S.C. 405, 102 S.E.2d 364 (1958).
It is clear that the government may be bound by an equitable estoppel in the same manner as
a private party when the elements requisite to such an estoppel against a private party are present and,
in the considered view of a court of equity, the injustice which would result from a failure to uphold
an estoppel is of sufficient dimension to justify any effect upon public interest or policy which would
result from the raising of the estoppel. Chaplis v. Monterey County, 97 Cal. App. 3d 249, 158 Cal.
Rptr. 395 (1979).
In reliance upon representations of agents of the Commission, Petitioner went to great
expense to construct a very functional building which serves the public. The Commission issued to
him a license, based on their inspection and their recommendations; agents of the Commission and
the Department have inspected the location on a quarterly basis since that time; and Petitioner has
never been informed that there was any problem with the building. Petitioner has proved the elements
of equitable estoppel in this case.
CONCLUSIONS OF LAW
Based upon the foregoing Findings of Fact, I conclude, as a matter of law, the following:
1. S.C. Code Ann. § 1-23-600 (Supp. 1994) grants jurisdiction to the Administrative
Law Judge Division to hear contested cases under the Administrative Procedures Act.
2. S.C. Code Ann. § 61-1-55 (Supp. 1994) grants to the Administrative Law Judge
Division the powers, duties and responsibilities as a hearing officer in protested and contested matters
governing alcoholic beverages, beer and wine.
3. Paragraph one of S.C. Code Ann. § 61-3-1000, which governs structural requirements
for doors in retail liquor stores, reads as follows:
Every retail dealer shall maintain a separate store or place of business with not more
than two means of public ingress or egress which must be on the front or the same
side of the building except that the doors may be located at the corner of two adjacent
sides of the building. One additional door, not in the front, is allowed to be used
solely for the receipt of commercial deliveries and as an emergency exit.
4. The primary rule of statutory construction is to ascertain and effectuate the intent of
the legislature. Words used in a statute must be given their plain and ordinary meaning without
resorting to subtle or forced construction to limit or expand the statute's operation. In interpreting
a statute, its terms must be construed in context and their meaning determined by looking at other
terms used in the statute. Statutory provisions should be given reasonable and practical construction
consistent with the purpose and policy of the entire act. Gilstrap vs. South Carolina Budget and
Control Board, 310 S.C. 210, 423 S.E.2d 101 (1992); Bryant v. City of Charleston, 295 S.C. 408,
268 S.E.2d 899 (1988). When statutory terms are clear and unambiguous, there is no room for
construction and courts are required to apply them according to their literal meaning. Citizens for
Lee County, Inc. vs. Lee County, 308 S.C. 23, 416 S.E. 2d 641 (1992).
5. The literal wording of Section 61-3-1000 limits ingress and egress for customers to
the front and adjacent side of the business. There is no limitation on entry through a side door from
another place of business, nor is there any requirement that a retail liquor store must be in a free-standing building.
6. Where an administrative agency has consistently applied a statute in particular manner,
its construction should not be overturned absent cogent reasons. Gilstrap vs. South Carolina Budget
and Control Board, 310 S.C. 210, 423 S.E. 2d 101 (1992). The Commission authorized the
configuration at Respondent's store, based on its interpretation of the applicable statutes. This
interpretation by the Commission and the Department has been consistent up until the date of the
citation in this case.
7. Generally, estoppel is not to be applied to deny a governmental agency due
exercise of its police power; however, government agents or officers acting within the proper scope
of their authority, can by their acts give rise to estoppel. S.C. Coastal Council v. Vogel,292 S.C. 449,
357 S.E. 2d 187 (Ct. App. 1987); County of Charleston v. National Advertiser, 292 S.C. 416, 359
S.E.2d 9 (1987).
The Department has failed in its burden to prove by a preponderance of the evidence that the
Respondent is in violation of § 61-3-1000. Absent any cogent reason otherwise, I conclude that the
citation against Respondent should be dismissed.
ORDER
Based upon the above Findings of Fact, Conclusions of Law and Analysis and Discussion, it
is hereby
ORDERED that the citation dated July 5, 1995, issued by the South Carolina Department of
Revenue and Taxation against William N. Massalon, d/b/a Bill's ABC Store at Lady Square Shopping
Center, Beaufort County, South Carolina, is dismissed.
AND IT IS SO ORDERED.
_____________________________________________
Marvin F. Kittrell
Chief Judge
Columbia, South Carolina
January 4, 1996 |