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SC Administrative Law Court Decisions

SCDOR vs. Collins Entertainment Corp.

South Carolina Department of Revenue

South Carolina Department of Revenue

Collins Entertainment Corp.

For the Petitioner: Carol I. McMahan, Esquire

For the Respondent: James H. Harrison, Esquire




This matter comes before me pursuant to S.C. Code Ann. §§ 1-23-310 et seq. (1986 and Supp. 1996) and 1-23-600 (Supp. 1996), upon request for a contested case hearing by Collins Entertainment Corporation ("Respondent"). Respondent was cited with an administrative violation of S.C. Code Ann. § 12-21-2748 (Supp. 1996) for allegedly failing to affix owner/operator identification to a machine licensed pursuant to S.C. Code Ann. § 12-21-2720(A)(3)(Supp. 1996) (commonly referred to as "Class III" machines). The South Carolina Department of Revenue ("Department") seeks an order from this court finding the alleged violation on March 26, 1997, at W. Butler and Watley Road, Mauldin, South Carolina. Further, the Department seeks a penalty of $2,500.00 for this violation.

The Respondent admits the identification sticker was not there; however, it argues it has no knowledge of the removal of such identification and no penalty should be imposed. It also argues that the penalty provision cited by the Petitioner as controlling here, S.C. Code Ann. § 12-21-2738 (Supp. 1996) has been amended to allow discretion as to the penalty imposed for such violations. Accordingly, it argues if a violation is found here, a minimum penalty should be imposed.

After timely notice to the parties, a contested case hearing was held in Columbia, South Carolina on December 18, 1997.

Based upon a thorough review of the record and of the testimony and evidence presented at the hearing, I conclude that the Respondent violated the provisions of Section 12-21-2748 and find that a penalty in the amount of Two Thousand Five Hundred ($2,500.00) Dollars is appropriate under the circumstances.


Without objection, Petitioner placed into evidence the following exhibits:

Exhibit 1: Department's Final Determination and Notice of Violation Letter from the Department dated September 18, 1997 and July 28, 1997, respectively.

Exhibit 2: Respondent's Request for a contested case hearing dated October 10, 1997.

Exhibit 3: Findings Report with memo to file by SLED agent Ben Moore, dated March 26, 1997, and April 10, 1997, respectively.

Exhibit 4: Respondent's Coin Operated Device Application for the Class III license at issue.

Exhibit 5: South Carolina Revenue Procedure 97-2.

Exhibit 6: Orders and Decisions in S.C. Department of Revenue v. Tire and Oil Company, Inc. and Collins Entertainment Corporation, Docket No. 97- ALJ-17-0310-CC (September 18, 1997); South Carolina Department of Revenue v. Collins Entertainment Corporation at Grand Central I- 77, Docket No. 97-ALJ-17-0443-CC (December 9, 1997); South Carolina

Department of Revenue v. Collins Entertainment, Inc., Docket No. 97-ALJ-17-0290-CC (September 3, 1997).


Having carefully considered all testimony and arguments presented at the hearing and taking into account the credibility of the witnesses, accuracy of the evidence and reviewing all of the exhibits carefully, I make the following findings by a preponderance of the evidence:

1. This Division has personal and subject matter jurisdiction.

2. Notice of the date, time, place and nature of the hearing was timely given to both parties.

3. Respondent is the owner of Class III machines and licenses. On March 26, 1997, Respondent had a Class III machine with License No. 3803635, at The Pantry located at W. Butler and Watley Road, Mauldin, South Carolina.

4. On March 26, SLED agent Ben Moore conducted an inspection at this location. He observed that the Class III machine with License No. 3803635, failed to have an owner/operator identification attached to the machine. He thoroughly examined the entire machine. Such inspection revealed there was no identification affixed to the machine. The agent asked the employee on duty, Edmond Hoffman, to inspect the machine. Mr. Hoffman was unable to locate an owner/operator identification sticker on the machine.

5. Agent Moore wrote up a Findings Report and left a copy with the store clerk, Mr. Hoffman.


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

1. This matter is properly before the Administrative Law Judge Division pursuant to the provisions of Chapter 23, Title 1 and S.C. Code Ann. § 12-4-30(D) (Supp. 1996).

2. S.C. Code Ann. § 12-21-2748 (Supp. 1997) provides:

Any person who owns or operates devices described in Sections 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. At the time of the violation, S.C. Code Ann. § 12-21-2738 provided:

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.

4. Section 8A of Act 53 of 1997 amended Section 12-21-2738 effective June 6, 1997. The amendment removed the language "no part of which may be suspended," from the statute.

5. Where a statute is clear and unambiguous, there is no room for construction and the terms of the statute must be given their literal meaning. Southeastern Fire Ins. Co. v South Carolina

Tax Comm'n, 253 S.C. 407, 171 S.E.2d 355 (1969); Green v. Zimmerman, 269 S.C. 535, 238 S.E.2d 323 (1977).

7. It is impossible for reasonable minds to differ as to the proper interpretation of S.C. Code Ann. § 12-21-2748 (Supp. 1996). That statute requires in unambiguous language that "owner/operator identification" be placed on the Class III machine "visible for inspection purposes." After a thorough examination of the evidence presented concerning the Class III machine at issue here, evaluating all of the evidence presented, I find and conclude that Respondent failed to have owner/operator identification on this machine on March 26, 1997 at the time of the SLED agent's inspection.

8. The Department seeks a penalty of Two Thousand Five Hundred ($2,500.00) Dollars for this violation. At the time of the violation S.C. Code Ann. § 12-21-2738 (Supp. 1996) provided that for violations such as that at issue here, a penalty of $2,500.00 was appropriate, "no part of which may be suspended." Although this provision was deleted by Act No. 53 of 1997, there is no indication whatsoever, in the language of the statute that would indicate a retroactive application of this provision. Prospective or retroactive application of a statute is controlled by legislative intent. Jenkins v. Meares, 302 S.C. 142, 394 S.E.2d 317 (1990). Retroactive application will not be given a statute unless it is clearly compelled and leaves no room for doubt. See American Nat'l Fire Ins. v. Smith Grading, 317 S.E. 445, 454 S.E.2d 897 (1995). Here, the violation occurred well before the amendment to S.C. Code Ann. § 12-21-2738. There is nothing that can be gleaned from the language of the amendment that would compel a retroactive application of its provisions. As such, I find and conclude that the amendment to the penalty provisions are not retroactive to the violation at issue. However, even if the amendment were retroactive, a penalty of $2,500.00 would be appropriate in this case based on Respondent's history of a multitude of violations of this nature, as set forth at Petitioner's Exhibit 6.


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

ORDERED that Respondent shall pay a fine to the Department in the amount of Two Thousand Five Hundred ($2,500.00) Dollars for the violation of S.C. Code Ann. § 12-21-2748 (Supp. 1996) on March 26, 1997.


Marvin F. Kittrell

Chief Judge

January 14, 1998

Columbia, South Carolina

Brown Bldg.






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