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

SCDOR vs. Edward Rothschild, d/b/a Con X Tion

South Carolina Department of Revenue

South Carolina Department of Revenue

Edward Rothschild, d/b/a Con X Tion

Nicholas P. Sipe
For Petitioner

H. Louis Sirkin, Esquire
John Delgado, Esquire
For Respondent



This matter comes before this tribunal pursuant to Respondent's request for a contested case hearing. The Department of Revenue issued a Final Agency Determination on June 23, 1997 alleging that Respondent, Edward Rothschild, d/b/a Con X Tion, failed to post a penalty sign to or on the wall behind four video poker machines, in violation of S.C. Code Ann. §12-21-2802. After notice to the parties, a hearing was conducted on December 16, 1997.

The issues before this tribunal are (1) whether Respondent violated S.C. Code Ann. §12-21-2802 (Supp. 1996) and (2) if so, what are the proper penalties for such violations. Based upon the following Findings of Fact and Conclusions of Law, this tribunal concludes that Respondent violated S.C. Code Ann. §12-21-2802. The penalty shall be $100 for each violation.


Having carefully considered all testimony 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. On January 21, 1997, Respondent operated four Class III video game machines licensed under S.C. Code Ann. §12-21-2720 at Con X Tion, 3111 B Broad River Road, Columbia, South Carolina.
  2. On January 21, 1997, South Carolina Law Enforcement Division (ASLED@) Agents K.B. Stokes and C. Graham inspected the video poker machines at Con X Tion and determined that the machines did not have prominently displayed signs citing penalties for tampering with machines, skimming proceeds, or manipulating the outcome of a machine, as required by S.C. Code Ann. §12-21-2802 (Supp. 1996).
  3. On January 21, 1997, SLED Agent Stokes issued a Preliminary Findings Report for Video Gaming to Respondent's attendant, which set forth the violations.
  4. Edward I. Rothschild is listed on the business tax application as the business owner of the licensed establishment. (Petitioner's Exhibit # 2).
  5. On May 30, 1997, the Department issued a citation to Respondent for violating § 12-21-2802 and assessed a penalty of $1200.
  6. The parties stipulated that Agent Graham's testimony, if presented, would be virtually identical to the testimony of Agent Stokes.


  1. Pursuant to S.C. Code Ann. §12-4-30(D) (Supp. 1996) and S.C. Code Ann. §1-23-320 (Supp. 1996), the Administrative Law Judge Division has jurisdiction to hear this case.
  2. S.C. Code Ann. §12-21-2802 (Supp. 1996) states: "Each machine licensed under this article [Video Game Machines Act] or Article 19 must have a prominently displayed sign citing the penalties provided by Sections 12-21-2790, 12-21-2792, and 12-21-2794 on the wall above the machine or affixed prominently to the machine. The commission shall make these signs available free of charge."
  3. The evidence shows that the signs were not displayed on the wall above or affixed prominently to the machines in question.
  4. Section 12-54-40(b)(3) provides: "a person who is liable to obtain a license or purchase stamps for identification purposes, who fails to obtain or display the license properly, or who fails to affix the stamps properly, or fails to comply with statutory provisions, is subject to a penalty of not less than fifty dollars nor more than five hundred dollars for each failure." S.C. Code Ann. § 12-54-40(b)(3) (Supp. 1996) (emphasis added). Respondent is responsible for obtaining licenses for his video poker machines pursuant to § 12-21-2720 (A)(3) and the failure to comply with the provisions of § 12-21-2802 subjects him to a fine.
  5. The weight and credibility assigned to evidence presented at the hearing of a matter is within the province of the trier of fact. See South Carolina Cable Television Ass'n v. Southern Bell Tel. and Tel. Co., 308 S.C. 216, 417 S.E.2d 586 (1992). Furthermore, a trial judge, who observes a witness, is in the better position to judge the witness's demeanor and veracity and evaluate his testimony. See McAlister v. Patterson, 278 S.C. 481, 299 S.E.2d 322 (1982); Peay v. Peay, 260 S.C. 108, 194 S.E.2d 392 (1973); Mann v. Walker, 285 S.C. 194, 328 S.E.2d 659 (Ct. App. 1985); Marshall v. Marshall, 282 S.C. 534, 320 S.E.2d 44 (Ct. App. 1984).
  6. It is a generally recognized principle of administrative law that the fact-finder has the authority to impose an administrative penalty, as established by the legislature, after the parties have had an opportunity to have a hearing and be heard on the issues. Walker v. South Carolina ABC Comm'n, 305 S.C. 209, 407 S.E.2d 633 (1991). See Ohio Real Estate Comm'n v. Aqua Sun Inv., 655 N.E.2d 266 (Ohio 1995); Shadow Lake of Noel, Inc. v. Supervisor of Liquor Control, 893 S.W.2d 835 (Mo. Ct. App. 1995); Matter of Henry Youth Hockey Ass'n, 511 N.W.2d 452 (Minn. Ct. App. 1994); Vermont Agency of Natural Resources v. Duranleau, 617 A.2d 143 (Vt. 1992); City of Louisville v. Milligan, 798 S.W.2d 454 (Ky. 1990); State Police v. Cantina Gloria's, 639 A.2d 14 (Pa. 1994).
  7. The Department seeks a penalty of $300 for each violation. I find that a more appropriate penalty to be assessed against the Respondent is the amount of $100 per machine for violating § 12-21-2802. Accordingly, I find that a total fine of $400 shall be assessed against the Respondent.


Based upon the foregoing Findings of Fact and Conclusions of Law, IT IS HEREBY ORDERED that, the Department shall impose a fine of Four Hundred Dollars against Respondent for the violations of S.C. Code Ann. § 12-21-2802.




Administrative Law Judge

Post Office Box 11667

Columbia, South Carolina 29211-1667

January 12, 1997

Columbia, South Carolina

Brown Bldg.






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