ORDERS:
FINAL ORDER AND DECISION
I. Statement of the Case
The South Carolina Department of Revenue (DOR) seeks to impose a forty-five day suspension of
Paul M. Hering's (Hering) beer and wine permit on the ground that Hering allowed the commission
of a crime on his permitted premises. Hering agrees that a violation of the law occurred, but
disagrees with DOR's assertion that a forty-five day suspension should be imposed. The
disagreement between the parties places jurisdiction in the Administrative Law Judge Division for
a contested case hearing. S.C. Code Ann. § 61-2-260 (Supp. 1998). Under the facts of this case,
Hering's beer and wine permit must be suspended for fifteen days and a fine of $1,500 must be
imposed.
II. Issues
Given Hering's admitted violation of S.C. Code Ann. § 61-4-580(5) (Supp. 1998) for selling
cigarettes to a minor on the premises where he utilizes his beer and wine permit, what is the
appropriate penalty for such a violation?
III. Analysis
Penalty for Permitting A Criminal Act
1. Positions of Parties
DOR asserts that the repeated violations at the current location require a forty-five day suspension.
Hering disagrees. He believes that the corrective steps taken to prevent the violation from occurring
again must be considered as mitigating factors. Under Hering's view either a shorter suspension or
a fine should be imposed.
2. Findings of Fact
I find by a preponderance of the evidence the following facts:
a. Background Facts
Earth Fare, a health food grocery store at 74 Holly Road in Charleston, South Carolina, operates its
business directed to a primary customer market of middle to high income adults. Its inventory of
beer is primarily imported and high-end domestic beer, and its wine selection is also primarily an
upscale gourmet selection. Earth Fare's only tobacco products are natural American Spirit cigarettes
and pouch tobacco.
The store's tobacco products became an issue on June 11, 1998. On that date an individual under
the age of eighteen was acting as an undercover informant for the City of Charleston Police
Department. The individual entered the Earth Fare grocery store and purchased a pack of American
Spirit cigarettes from an employee of the store. At the time of sale, the store clerk did not ask for
any identification and did not require proof of age. After the sale was made, an officer for the City
of Charleston Police Department issued a criminal citation to the store employee for having sold
cigarettes to a person under eighteen. Further, on June 23, 1998, a Special Agent from SLED issued
a civil citation to Hering for permitting a criminal act (the sale of cigarettes to a person under
eighteen) on the same premises that were being used for Hering's beer and wine permit.
The June 11, 1998 violation was not the first for the Earth Fare store. Rather, the violation was the
third in less than ten months. On August 13, 1997, the operators of Earth Fare sold beer to a person
under twenty-one years of age and on November 28, 1997 sold cigarettes to a person under eighteen.
For the two previous violations, Earth Fare paid fines of $400 and $800, respectively. For the third
violation, DOR now seeks a forty-five day suspension.
b. Mitigating Facts
Earth Fare asserts it has taken significant steps to avoid any recurrence of the prior errors which
resulted in the violations. Hering believes these steps should mitigate the penalty.
First, management has changed. Earth Fare has replaced the general manager of the Charleston Store
and has directed a new emphasis seeking to avoid unlawful sales to minors. That new emphasis
includes one-on-one training between management and each cashier, as well as departmental training
for all cashiers and front end associates regarding procedures for the sale of alcohol and tobacco.
Second, Earth Fare has increased its total training to all employees. The store hosted a State Law
Enforcement Division representative in October of 1998 to provide additional training to its
Charleston personnel. Training now includes a requirement that each employee execute a written
acknowledgment that a violation of the procedures for the sale of alcohol and tobacco will result in
disciplinary action up to and including termination. Additionally, Earth Fare has increased the total
awareness of its no-sale-to-minors policy by increasing the number and size of signs declaring the
store's policy. The signs are now posted in merchandise locations and at cash registers.
Finally, Earth Fare has installed a computerized program in its electronic cash registers which
requires the entry of a birth date whenever a tobacco or alcohol product is scanned by the electronic
reader. The entry of a birth date reveals whether the buyer is legally authorized to purchase the
tobacco or alcohol. If the buyer is underage, the sale cannot be completed.
3. Conclusions of Law
Any party operating under a beer and wine permit who knowingly allows the commission of a
criminal act on the premises is subject to a penalty or suspension of the holder's permit. S.C. Code
Ann. § 61-4-580(5) (Supp. 1998). Here, no dispute exists that on June 11, 1998, an employee
operating under Hering's beer and wine permit committed the criminal act of violating S.C. Code
Ann. § 16-17-500 (Supp. 1998) by selling cigarettes to a person under age twenty-one. Thus, the
issue is what penalty is proper. In answering that issue, the Administrative Law Judge, the
fact-finder, is empowered to impose the appropriate penalty based on the facts presented. Walker
v. South Carolina ABC Comm'n, 305 S.C. 209, 407 S.E.2d 633 (1991).
a. Factors Considered
On one hand, this violation of S.C. Code Ann. § 61-4-580 (Supp. 1998) is the third in ten months
and each violation has involved an unlawful sale to a minor. The evidence demonstrates that prior
monetary penalties have not halted the illegal sale to minors. Indeed, given the past performance of
this location, significant changes are required to prevent repeating past violations.
b. Factors Mitigating
However, on the other hand, significant changes have been made by Hering and those changes
warrant consideration in establishing a penalty. In imposing a penalty here, three mitigating factors
are relevant.
First, management has changed. Old management has been dismissed and the new management has
exhibited a heightened emphasis on stopping all unlawful sales to minors.
Second, Earth Fare has increased its total training to all employees. Training has been received by
store employees from SLED personnel, each employee now executes a written acknowledgment that
a violation of the procedures for the sale of alcohol and tobacco will result in disciplinary action, and
the number and size of signs declaring the store's policy have increased, with such signs now posted
in appropriate merchandise locations and at the cash registers.
Finally, Earth Fare now utilizes a computerized program for all its sales that requires the entry of a
birth date before the sale can be completed. If the buyer is underage, the sale cannot be completed.
c. Conclusion From All Factors
On the whole, the above three factors are only mitigating; none alone or in combination are sufficient
to defeat the need to impose a suspension in this case. Here, a third violation occurred despite prior
monetary fines, and all three violations involved sales to minors. Thus, fines have not been able to
halt the problem. Given all of the facts of this case, and considering the mitigating factors
established, Hering's beer and wine permit must be suspended for fifteen days, and a fine of $1,500
must be imposed.
IV. Order
Based upon the Findings of Fact and Conclusions of Law, it is hereby ordered:
On the tenth day after the date of this order, Hering must pay to DOR a fine of $1,500, and
beginning at 12:01 a.m. on that tenth day, Hering's beer and wine permit must be suspended for
fifteen days.
AND IT IS SO ORDERED.
RAY N. STEVENS
Administrative Law Judge
Dated: April 9, 1999
Columbia, South Carolina |
