South Carolina              
Administrative Law Court
Edgar A. Brown building 1205 Pendleton St., Suite 224 Columbia, SC 29201 Voice: (803) 734-0550

SC Administrative Law Court Decisions

CAPTION:
SCDOR vs. Roadrunners Softball Association and Derrell Lee, Promoter

AGENCY:
South Carolina Department of Revenue

PARTIES:
Petitioners:
South Carolina Department of Revenue

Respondents:
Roadrunners Softball Association and Derrell Lee, Promoter
 
DOCKET NUMBER:
95-ALJ-17-0664-CC

APPEARANCES:
Nicholas P. Sipe
Attorney for the Petitioner

Mark A. Mason
Attorney for the Respondents
 

ORDERS:

ORDER AND DECISION

This matter comes before me for a hearing pursuant to S.C. Code Ann. §§ 1-23-310, etseq. (Supp. 1994) and S.C. Code Ann. § 12-4-30 (Supp. 1994) on the citation issued by the Department of Revenue and Taxation ("Department") against Roadrunners Softball Association ("Roadrunners"), and the present promoter of Roadrunners, Derrell Lee. The Department alleges that the Respondents violated S.C. Code Ann. § 12-21-3440(A)(1) (Supp. 1995) by offering prizes in excess of two hundred fifty thousand dollars at the bingo session held on May 6, 1995. The Department assessed a penalty of $1000 for the alleged violation of S.C. Code Ann. § 12-21-3440(A) (1) and seeks revocation of Respondents' bingo license and promoter's license. Respondents deny and contest the alleged violation, which necessitates this hearing before the Administrative Law Judge Division. After timely notice to the parties, a hearing was conducted at the Administrative Law Judge Division Hearing Room #2, Columbia, South Carolina.

FINDINGS OF FACT

Having carefully considered all testimony, exhibits, and arguments presented at the hearing of this matter, and taking into account the credibility and accuracy of the evidence, I make the following Findings of Fact by a preponderance of the evidence:

1. Respondent Roadrunners holds a Class AA Bingo License (#000035) to conduct bingo.

2. Respondent Roadrunners is a non-profit charitable organization which was incorporated in South Carolina for the purpose of social development of young women through participation in amateur sporting events.

3. Respondent Derrell Lee held a promoter's license for Roadrunners Softball Association on May 6, 1995.

4. On May 6, 1995, Respondents conducted a bingo session in Columbia, South Carolina. At this session, Respondents paid $283,000 in the form of prizes to the players of bingo.

5. On or about July 24, 1995, the Department cited Respondents for an alleged violation of S.C. Code Ann. § 12-21-3440(A) (1) and assessed a penalty of $1000 and seeks revocation of Respondents' bingo license and promoter's license.

6. At the hearing of this matter, Respondents admitted that the $283,000 prize payout limitation was knowingly exceeded at the May 6, 1995 bingo session.

7. Respondents increased the amount of the payouts to the players of bingo for certain games, and as a result, extra sheets were purchased for these games by the players.

8. Respondents admit that the Association was very familiar with the bingo laws, but was under the impression that the Association could not be cited for any violations because of a previous Order issued by The Honorable Frank P. McGowan, Jr.

9. Roadrunners conducted 23 bingo sessions in Florence between September 1993 and April 1995. During this time, Roadrunners only had bingo crowds in excess of 4,000 people on one occasion. The May 6, 1995 session was its first in Columbia, South Carolina. Respondents did not anticipate the approximately 5,000 people who attended the May 6, 1995 session, with 80% traveling from out-of state. Respondents have conducted seven sessions in Columbia since the May 6, 1995 session without exceeding the maximum legal payout.

10. Barry Goldstein, testifying on behalf of the Respondents, stated that he consulted Johnnie Legette, Coordinator of Enforcement of the Department, on May 6, 1995 concerning what the organization should do if they are going to exceed the prize limitation. Goldstein further testified that he was told it would probably be best to return the money to the players, but he should consult his attorney and do what he thought was best. Johnnie Legette denied advising the Respondents to violate S.C. Code Ann. § 12-21-3440(A) (1), by returning more than the statutory maximum legal payout to the players.

11. Respondent, Roadrunners, does not have any outstanding tax liabilities.

CONCLUSIONS OF LAW AND DISCUSSION

Based on the foregoing Findings of Fact, I conclude, as a matter of law, the following:

Pursuant to S.C. Code Ann. §§ 1-23-310 et seq. (Supp. 1994) and S.C. Code Ann. § 12-4-30 (Supp. 1994), the South Carolina Administrative Law Judge Division has jurisdiction over this matter.

A. Violation

1. Respondents are cited with violating S.C. Code Ann. § 12-21-3440(A)(1) (Supp. 1995). This provision provides, in pertinent part:

CLASS AA: An organization operating a bingo game offering prizes with a minimum payout of fifty thousand dollars a session shall obtain an annual Class AA bingo license at a cost of four thousand dollars a year. The prizes offered at any one session may not exceed two hundred fifty thousand dollars.
. . . .

It is clear from the record that on May 6, 1995, on the occasion alleged, Respondents exceeded the prize limitation of S.C. Code Ann. § 12-21-3440(A)(1) by offering $283,000 in prizes. Respondents suggest that S.C. Code Ann. § 12-21-3440(A)(1) (prize limitation of $250,000) conflicts with S.C. Code Ann. § 12-21-3420(12), which requires no less than 50% of gross proceeds taken in during a single session to be returned to the players in the form of prizes. Unquestionably, Respondents faced a legal dilemma. However, these statutory sections are part of the same general statutory law and must be construed together and may be so construed without conflict. Thomas v. State, __ S.C. __, 465 S.E.2d 350 (1995). Here, the prescription of each of the statutory sections could have been met by limiting the number of players. The Respondents violated S.C. Code Ann. § 12-21-3440(A) (1) by offering $283,000 in prizes on May 6, 1995.

B. Determination on Penalties

1. Revocation

The Department seeks the revocation of Respondents' bingo license and promoter's license for the violation of S.C. Code Ann. § 12-21-3440(A)(1). As the trier of fact, this tribunal concluded that Respondents exceeded the maximum legal payout and it also concludes that mitigating circumstances exist in this case; and, as such, revocation of the aforementioned licenses is unwarranted. The Respondents unforeseeably faced a legal conundrum. Respondents did not anticipate the large crowd of 5,000 people, approximately 80% of whom were from out-of state; and, further, this was the first session held in Columbia, South Carolina. Previous crowds in 23 sessions conducted in Florence, South Carolina had exceeded 4,000 people only once. As Respondents failed to limit the number of players, Respondents were faced with exceeding the maximum payout limit or not complying with the 50% single session prize return. Respondents have conducted seven sessions in Columbia, South Carolina since May 6, 1995 and have ostensibly taken measures to avoid another occurrence of this predicament, as Respondents have not subsequently exceeded the prize limitation.

2. Monetary Fine

The Department imposed a $1000 fine upon Respondents for violation of S.C. Code Ann. § 12-21-3440(A)(1). Section 12-21-3550 permits the imposition of a fine by the Department of $20 to $1,000 for a violation of the Bingo Act. Respondents violated the statutory maximum legal payout. Even though faced with the prospect of exceeding the maximum legal payout, Respondents, nonetheless, sold extra play-sheets or cards to certain games which only exacerbated the situation. Accordingly, the imposition of a fine of $1,000 is appropriate in this case.

ORDER

IT IS THEREFORE ORDERED that Respondents pay a fine of $1,000 (total) to the Department of Revenue and Taxation, within fifteen (15) days, for violating the laws regulating the conduct of bingo games, as set forth above.

IT IS FURTHER ORDERED that any motions or issues raised in the proceedings, but not addressed in this Order are deemed denied pursuant to ALJD Rule 29(B).

AND IT IS SO ORDERED.



_____________________________________

JOHN D. GEATHERS

Administrative Law Judge

Edgar A. Brown Building

1205 Pendleton Street

Columbia, South Carolina 29201

March 18, 1996

Columbia, South Carolina


Brown Bldg.

 

 

 

 

 

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