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SC Administrative Law Court Decisions

SCDOR vs. Lexington County Voiture No. 1211, et al

South Carolina Department of Revenue

South Carolina Department of Revenue

Lexington County Voiture No. 1211, La Societe des 40 Hommes et 8 Chevaux, and Matthew P. Loving

Geoffrey R. Bonham
Attorney for Petitioner

William O. Higgins
Attorney for Respondents




This matter comes before this tribunal pursuant to S.C. Code Ann. §§ 1-23-600 et seq. and S.C. Code Ann. § 12-4-30 (Supp. 1997). Respondents were cited for violating S.C. Code Ann. § 12-21-4270 (Supp. 1997) of the Bingo Tax Act of 1996, S.C. Code Ann. §§ 12-21-3910 et seq. (Supp. 1997). The South Carolina Department of Revenue assessed a $5,000 penalty against Respondents because of their failure to remit timely sixteen and one-half percent of the total face value of bingo cards for which Respondents made application. Respondents admit that they untimely remitted the amount owed, but contend that the penalty is excessive given the extenuating circumstances in this case. After timely notice to the parties, a hearing was conducted on November 19, 1998, at the Administrative Law Judge Division in Columbia. Based on the testimony and evidence presented, the Department's decision to impose the monetary fine against Respondents is sustained.


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.

On October 17, 1997, Matthew P. Loving, in his capacity as promoter, applied to the Department for bingo cards in the name of two licensed nonprofit organizations, Lexington County Voiture No. 1211 and La Societe des 40 Hommes et 8 Chevaux. As a result of the application, the Department issued to the distributor, Maiden Amusements, a bingo card purchase voucher in the amount of $98,600. In turn, Respondents were responsible for remitting $16,269 (16.5% of $98,600) to the Department on or before November 3, 1997. Although Respondents failed to remit the payment by November 3, 1997, on November 4, 1997, they made a partial payment of $10,000 and satisfied the remaining balance of $6,269 on November 7, 1997.

Respondents cite the following as extenuating circumstances that contributed to their inability to remit timely the payment. Between October 17, 1997 and October 31, 1997, Respondents were unable to generate enough bingo business to fully utilize the purchased bingo cards. For that reason, Respondents did not produce the revenue they had anticipated, which inhibited their ability to remit timely the $16,269 payment. On October 31, 1998, Respondents informed the Department agent of their inability to timely pay and inquired as to the penalty they would incur for a late payment. Respondents also attempted to schedule a meeting with another official of the Department prior to the November 3, 1997 deadline.


Section 12-21-4270 pertains to the application to obtain bingo cards and provides:

Each licensed nonprofit organization or promoter, in the name of a licensed organization, may obtain bingo cards approved by the department by making application and remitting sixteen and one-half percent of the total face value of the cards to be purchased. Payment to the State for the issuance of bingo cards must be made by certified check within fifteen days of receipt of the application.

In the case at bar, it is undisputed that Respondents failed to remit sixteen and one-half percent of the total face value of the bingo cards within fifteen days of their application. Accordingly, Respondents are subject to a penalty of up to $5,000 and revocation of their licenses. S.C. Code Ann. § 12-21-4140 (Supp. 1997). Further, the Respondents are jointly and severally liable for the penalty. S.C. Code Ann. § 12-21-3960 (Supp. 1997).

However, Respondents contend that the penalty is excessive under the circumstances of their case and that the penalty should be reduced. Inherent in and fundamental to the quasi-judicial powers of this tribunal, as the trier of fact in contested cases under the Administrative Procedures Act, S.C. Code Ann. §§ 1-23-310 et seq. (1986 & Supp. 1997), is the power to determine the appropriate penalty under the facts presented. Walker v. South Carolina ABC Comm'n, 305 S.C. 209, 407 S.E.2d 633 (1991). Even so, this tribunal does not find mitigating facts present in the case at bar to warrant disturbing the penalty imposed by the Department.

The penalty provision, S.C. Code Ann. § 12-21-4140, provides that "[a] penalty of up to five thousand dollars and revocation of the license at the discretion of the department may be imposed for a violation of this article. Each violation and each day in violation of a provision of this article constitutes a separate offense." (Emphasis added). It is evident from § 12-21-4140 that, in addition to a monetary penalty, Respondents' licenses were subject to revocation under the facts of this case. Further, each day past the due date of the payment constituted a separate offense. Hence, Respondents did not receive the most severe penalty permissible under the law, as their licenses were subject to revocation and they could have been charged with additional offenses. Therefore, the fact that Respondents recognized the fact that they exercised "bad business judgment," and notified the Department of their mistake before the due date, does not merit a reduction in the penalty. To hold otherwise on these facts would make the administration and adjudication of these matters unwieldy.


Based upon the foregoing Findings of Fact and Conclusions of Law, IT IS HEREBY ORDERED that the $5,000 penalty imposed by the Department against the Respondents is sustained.


______________________________ JOHN D. GEATHERS

Administrative Law Judge

Post Office Box 11667

Columbia, South Carolina 29211-1667

December 14, 1998

Columbia, South Carolina

Brown Bldg.






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