SC Administrative Law Court Decisions

This matter is before the Administrative Law Judge Division pursuant to a request by Respondent Michael W. Mims, d/b/a Palmetto Games for a hearing on a citation issued by the Department of Revenue for violation of S.C. Code Ann. §12-21-2748 (Supp. 1996). After notice to the parties, a hearing was conducted on July 1, 1997. Based upon the evidence presented, the Respondent violated the provisions of S.C. Code Ann. § 12-21-2748 (Supp. 1996). Any issues raised in the proceeding or hearing of this matter that are not specifically addressed in this Order are deemed denied. ALJD Rule 29.

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

1. On October 29, 1996, a South Carolina State Law Enforcement (SLED) officer entered the Corner Pit Stop located at 1215 Magnolia Street in Orangeburg, South Carolina for the purposes of determining compliance with the Coin Operated Devices Act and the Video Game Machines Act.

2. Inside the location, there were five coin operated video machines licensed pursuant to S.C. Code Ann. § 12-21-2720(A)(3).

3. All five machines displayed coin operated device Class III licenses.

4. Four of the machines displayed a sticker that contained information identifying the owner as Palmetto Games and the owner's address and phone number. A machine bearing Class III license number 3810255 did not have a sticker or any other information identifying the owner or operator of the machine.

5. The SLED officer issued a preliminary report finding a violation of the Video Game Machines Act for failing to display owner identification on one of the Class III machines. A copy was mailed to Palmetto Games.

6. A few days prior to October 29, 1996, the route supervisor for Palmetto Games had inspected the machines and each machine had a sticker attached to it that contained information identifying the owner.

7. The operator of the location also inspected the machines a few days before the inspection and each machine had a sticker that identified the owner.

8. After the inspection, the operator of the location and the route supervisor for Palmetto Games examined the machine cited and found a sticky area on the machine which indicated that there had been a sticker affixed to the machine.

9. At the time of the inspection, there was no identifying information on the machine. The SLED officer obtained information about the cited machine from an employee at the location and from the other machines located on the premises.

10. The SLED officer did not have access to or knowledge of any information contained in the Biennial Coin-Operated Device Application.

11. Prior to October 29, 1996, the Class III video game machines located at the Corner Pit Stop had owner identification information affixed to the machines.

12. The Department had not issued any violations against Petitioner for failing to have owner identification attached to the machines before October 29, 1996.

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

1. The Administrative Law Judge Division has jurisdiction to hear this matter pursuant to S.C. Code Ann. § 12-4-30(D) (Supp. 1996) and S.C. Code Ann. § 1-23-320 (Supp. 1996).

2. S.C. Code Ann. § 12-21-2748 (Supp. 1996) provides:

Any person who owns or operates devices described in §§ 12-21-2720 and 12-21-2730 must have attached to the machine information identifying the owner or operator of the machine. The identification must be placed on an area of the machine which is visible for inspection purposes. This identification is a condition precedent before the machines may be operated on location. Failure to comply with this requirement subjects the violator to the penalty and enforcement provisions of this chapter and of Chapter 54 as applicable.

3. The Respondent argues that the statute requires only that "information identifying the owner or operator of the machine" must be attached to the machine. According to the Respondent, that information need not be a sticker with the name and address but simply information from which the owner or operator can be identified. The Class III license affixed to the machine can be used to obtain information on who is the owner. The license number can be used to obtain the Biennial Coin- Operated Device Application and the name of the machine owner as indicated on the application.

4. The Department's response is that if the Class III license could be used to obtain the information, there would be no need for a separate statute requiring information identifying the owner to be attached to the machine.

5. "A basic presumption exists that the legislature had knowledge of previous legislation when later statutes are passed in related subjects." Berkebile v. Outen, 311 S.C. 50, 426 S.E. 2d 760 (1993). We must presume that in passing new statutes, the legislature intended to accomplish something and not do a futile or redundant act. See State ex rel. McLeod v. Montgomery, 244 S.C. 308, 136 S.E. 2d 778 (1964).

6. In addition, Respondent argues, when Section 12-21-2748 was enacted there was no requirement that the coin operated device licenses be affixed to the machines. There was no information on the machines that would provide any means of ascertaining the owner. The statute was needed. Now that the licenses are required to be attached to the machines, there is a mechanism available to obtain information about the machine.

7. This argument by Respondent is without merit. The requirement to display a license on the machine as provided in Section 12-21-2726 was enacted in 1986 at least one year before the enactment of Section 12-21-2748. The requirement that the license be affixed to a permanent, non transferable part of the machine under Section 12-21-2732 was also enacted in 1986 before the owner identification statute.

8. Currently, the Department of Revenue does not investigate violations of the Video Game Machines Act and the Coin Operated machines and devices' statutes. These statutes are investigated by the State Law Enforcement Division. SLED does not have access to the applications for the coin operated devices or retail license applications. These applications are business records of the Department of Revenue and relate to business and license taxes and fees. The Department of Revenue takes information gathered by SLED and issues any citations for violation of these statutes.

9. Although there is no legislative history discussing the reasons for enacting the legislation, the language of the statute states that the information must be visible for inspection purposes. It is a reasonable presumption that the purpose is to allow the investigator to be able to readily identify the owner of the machine without resort to records not in his possession for determining the proper licensing and the issuance of any citations if necessary.

10. No matter the reason for enacting the provisions of Section 12-21-2748, the legislature is presumed to know the import of its actions and would not endeavor to enact statutes that are not needed or redundant in nature.

11. In this case, the evidence indicates that the machine did not have the owner identification attached at the time of the inspection. The Respondents violated the provisions of S.C. Code Ann. §12-21-2748 (Supp. 1996).

12. Respondent also argues that the penalty provisions of S.C. Code Ann. § 12-21-2738 (Supp. 1996) have been amended to provide for suspension of a portion of the monetary penalty. At the time of the issuance of the preliminary report by SLED, Section 12-21-2738 read,

A person, who fails, neglects, or refuses to comply with the terms and provisions of this article or who fails to attach the required license to any machine, apparatus, billiard, or pocket billiard table, as herein required, is subject to a penalty of fifty dollars for each failure, and the penalty must be assessed and collected by the commission.

If the violation under this section relates to a machine licensed pursuant to Section 12-21-2720(A)(3), the applicable penalty amount is two thousand five hundred dollars, no part of which may be suspended, and one-half of this penalty must be deposited to the credit of the general fund of the State and one-half must be retained by or forwarded to the law enforcement or administrative agency charging the violation.

S.C. Code Ann. § 12-21-2738 (Supp. 1996).

13. Section 8 of Act 53 of 1997 amended this section in particular the second paragraph. The amended paragraph reads:

If the violation under this section relates to a machine licensed pursuant to Section 12-21-2720(A)(3), the applicable penalty amount is two thousand five hundred dollars, and one-half of this penalty must be deposited to the credit of the general fund of the State and one-half must be retained by or forwarded to the law enforcement or administrative agency charging the violation.

The effective date of this amendment was June 6, 1997.

14. The amendment relied upon by Respondent is no longer the law of the state. It was amended by Act 114 of 1997.

15. Section 6 of Act 114 of 1997 also amended Section 12-21-2738, in particular the second paragraph. As amended this paragraph reads:

If the violation under this section relates to a machine licensed pursuant to Section 12-21-2720(A)(3), the applicable penalty amount is two thousand five hundred dollars, a part of which may not be suspended. This penalty must be deposited to the credit of the general fund of the State.

The effective date of this amendment was June 13, 1997.

16. Based upon the last enactment affecting Section 12-21-2738, the penalty for failure to affix information identifying the owner to a Class III machine is $2,500, a part of which may not be suspended. The language of the statute clearly states that a part of the $2,500 fine may not be suspended.

Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby

ORDERED, that Michael W. Mims, d/b/a Palmetto Games violated S.C. Code Ann. § 12-21-2748 (Supp. 1996) by failing to have information identifying the owner of the machine licensed under Section 12-21-2720 placed on an area of the machine visible for inspection purposes.

IT IS FURTHER ORDERED that the Respondent, Michael W. Mims, d/b/a Palmetto Games is fined $2,500 payable to the Department of Revenue.

AND IT IS SO ORDERED.

ALISON RENEE LEE

Administrative Law Judge

July 3, 1997

Columbia, South Carolina