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Administrative Law Court
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SC Administrative Law Court Decisions

SCDOR vs. Irmo Amusement Company, Inc.

South Carolina Department of Revenue

South Carolina Department of Revenue

Irmo Amusement Company, Inc.

Nicholas Sipe, Esquire for Petitioner

Joseph C. Coleman, Esquire for Respondent



This matter comes before me on the citation issued by the Department of Revenue and Taxation on June 6, 1995 for a violation of Article 19 regulating coin-operated machine and devices and other amusements, S.C. Code Ann. §§ 12-21-2703 et seq., specifically S.C. Code Ann. § 12-21-2738. After notice to the parties a hearing was conducted on October 5, 1995. At the time of the hearing, the parties stipulated to the following facts:


1. Irmo Amusement Co., Inc. is the owner of a Class III video poker machine with a free play feature located at Hickory Ridge Golf in Richland County, South Carolina.

2. The machine was in operation on June 6, 1995.

3. Henry Priester of Irmo Amusement purchased from the Department of Revenue and Taxation several licenses for Class III machines on May 31, 1995.

4. The licenses are not issued for any specific Class III machine.

5. The machine located at Hickory Ridge Golf owned by Irmo Amusement did not have a current license displayed on the machine.


I make the following findings of fact, considering the burden on the parties to establish their cases by a preponderance of the evidence and taking into account the credibility of the witnesses:

1. Mr. Henry Priester, the owner of Irmo Amusement. There is a partner in the business who is not involved in its daily operation. No one else assists him in the operation of the business.

2. On May 4, 1995, he was hospitalized for surgery on an infected finger.

3. After surgery, he developed severe congestive heart failure which prolonged his hospitalization and caused him to be weak.

4. After discharge from the hospital on May 13, 1995, he continued to take medication and physical therapy for his hand for at least one month. He was also required to rest for portions of the day.

5. On May 31, 1995 Mr. Priester purchased 17 Class III licenses for video poker machines. The machines were placed in four different locations, one of these was Hickory Ridge Golf.

6. Mr. Priester was travelling to each of the locations to place the licenses on the machines.

7. He did not call anyone at the locations to request that the machines be disconnected or taken out of operation until the new license was affixed to the machines. He also did not call anyone at the locations to inform them that the licenses has expired on the machines and not to use them.

8. On June 6, 1995 Mr. Priester received a call from Hickory Ridge Golf, a revenue agent from the Department was present and prepared to issue a citation. Mr. Priester informed the agent that he had the licenses and was in route to place the licenses on the machines.

9. When Mr. Priester arrived, the agent issued him a citation for a violation of S.C. Code Ann. § 12-21-2738. Mr. Priester then affixed the licenses to the machines.

10. Irmo Amusement has not been cited for any violation relating to the licensing and operation of video poker machines.


1. Pursuant to S.C. Code Ann. § 12-4-30(D) all contested cases previously heard by the three commissioners of the South Carolina Tax Commission shall be heard by an administrative law judge under the provisions of Chapter 23, Title 1. S.C. Code Ann. § 12-4-30(D) (Supp. 1994).

2. S.C. Code Ann. § 12-21-2720(A) provides that a person who maintains for use or permits the use of a video game machine with free play feature operated by a slot in which a coin is deposited shall apply for and procure from the Department a license for the privilege of making use of the machine in South Carolina and shall pay a license tax of three thousand dollars for each machine. S.C. Code Ann. § 12-21-2720(A) (Supp. 1994).

3. Every person who maintains for use or permits the use of a machine subject to license "by way of proof of licensing must have a current license displayed conspicuously on the front of the machine." S.C. Code Ann. § 12-21-2726 (Supp. 1994).

4. All licenses issued for machines pursuant to Section 12-21-2703, et seq. expire on May 31 of the second year of issue. S.C. Code Ann. § 12-21-2734 (Supp. 1994).

5. "A person who fails, neglects, or refuses to comply with the terms and provisions of [Article 19 on coin operated devices] or who fails to attach the required license to any machine ... as herein required, is subject to a penalty ... for each failure, and the penalty must be assessed and collected by the commission." S.C. Code Ann. § 12-21-2738 (Supp. 1994).

6. S.C. Code Ann. § 12-21-2738 also requires that if the violation relates to a machine licensed pursuant to S.C. Code Ann. § 12-21-2720(A)(3), the applicable penalty is $2500, no part of which may be suspended.

7. The unexpected physical delay argued by Respondent is not persuasive in this instance. Although the physical condition limited some activity of Mr. Priester, it occurred before the licenses were purchased. The condition did not interfere with the use of the telephone or otherwise prevent Respondent from notifying the locations so the machines could be disengaged for use until current licenses were placed on them.

8. The law is clear, display of the license is proof of licensing. The failure or neglect in attaching the license to a machine is a violation of the statute. For a violation involving video poker machines with free play feature, the penalty is $2500, no part of which may be suspended. There is no discretion to be exercised with respect to the imposition of the monetary penalty.


For the reasons stated in the Findings of Fact and Conclusions of Law, it is hereby,

ORDERED, that Irmo Amusement Company, Inc., has violated S.C. Code Ann. § 12-21-2738 by failing to display a current license on a video poker machine with free play feature and is fined $2500 payable to the Department of Revenue and Taxation within ten days of the date of this Order.




Administrative Law Judge

October ______, 1995

Columbia, South Carolina

Brown Bldg.






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