South Carolina Dept. of Revenue v. Blue Moon of Newberry, Inc.

693 S.E.2d 21, 387 S.C. 467, 2010 S.C. App. LEXIS 40
CourtCourt of Appeals of South Carolina
DecidedMarch 24, 2010
Docket4661
StatusPublished
Cited by4 cases

This text of 693 S.E.2d 21 (South Carolina Dept. of Revenue v. Blue Moon of Newberry, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of South Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
South Carolina Dept. of Revenue v. Blue Moon of Newberry, Inc., 693 S.E.2d 21, 387 S.C. 467, 2010 S.C. App. LEXIS 40 (S.C. Ct. App. 2010).

Opinions

CURETON, A.J.

The South Carolina Department of Revenue (Department) sought to revoke the alcoholic beverage license and permit of Blue Moon of Newberry, Inc. (Blue Moon). The Department appeals the Administrative Law Court’s (ALC’s) order denying the revocation, arguing the ALC incorrectly interpreted a Departmental regulation governing Blue Moon’s operation and failed to find facts consistent with the evidence presented at trial. We reverse.

FACTS

Blue Moon operated a private social club known as the Blue Moon Sports Bar. Denise Polifrone managed the club, which also employed William Lindler and Steve Malone. On September 9, 2006, Quincy Ford (Agent Ford); an agent of the South Carolina State Law Enforcement Division (SLED), attempted to enter the club. Lindler, the doorman, asked whether Agent Ford was a member. Upon learning Agent Ford was not a member, Lindler denied him entry but directed him to a nearby poster that provided a telephone number for non-members to call to get permission to enter the club.

Agent Ford called the telephone number on the poster and spoke -with Malone.1 Malone took down Agent Ford’s name and instructed him to approach the doorman again. When Agent Ford sought access to the club again, Lindler recognized his name as approved for entry, checked Agent Ford’s identification, and allowed him to enter the club. Once inside, Agent Ford ordered and paid for an alcoholic beverage, consumed a small portion of it, and left.

On the same day, SLED issued a violation report against Blue Moon for permitting Agent Ford, a non-member, to consume liquor in the club. The Department sought to revoke [470]*470Blue Moon’s alcoholic beverage license and permit as a result of this violation.2 Blue Moon appealed the Department determination and sought a contested case hearing before the ALC. The ALC denied the revocation, finding Agent Ford was a guest of Malone, a club member. This appeal followed.

STANDARD OF REVIEW

Our review of an order of the ALC is confined to the record. S.C.Code Ann. § l-23-610(B) (Supp.2009). This court may reverse or modify a decision of the ALC if that decision prejudices the substantive rights of the petitioner by violating statutory provisions, resting upon an error of law, or exhibiting an abuse of discretion or a “clearly unwarranted exercise of discretion.” Id. “The construction of a statute by the agency charged with its administration should be accorded great deference and will not be overruled without a compelling reason.” Vulcan Materials Co. v. Greenville County Bd. of Zoning Appeals, 342 S.C. 480, 496, 536 S.E.2d 892, 900 (Ct.App.2000). Legislatively approved regulations of state agencies have the full force and effect of law. S.C.Code Ann. § 1-23-160 (2005). This court may review questions of statutory construction without deference to the trial court. Charleston County Parks & Recreation Comm’n v. Somers, 319 S.C. 65, 67, 459 S.E.2d 841, 843 (1995).

LAW/ANALYSIS

The Department first contends the ALC erred in interpreting the regulation permitting bona fide guests of members to consume certain alcoholic beverages3 on the premises of a nonprofit organization. We agree.

The General Assembly is authorized to enact statutes permitting the sale and consumption of alcoholic beverages “on the premises of certain nonprofit organizations with limited [471]*471membership not open to the general public.” S.C. Const, art. VIII-A. The General Assembly has defined a “nonprofit organization” as “an organization not open to the general public, but with a limited membership and established for social, benevolent, patriotic, recreational, or fraternal purposes.” S.C.Code Ann. § 61-6-20(6) (2009).

“Only bona fide members and bona fide guests of members of [nonprofit] organizations may consume alcoholic beverages sold in sealed containers of two ounces or less upon the licensed premises.”4 23 S.C.Code Ann. Regs. 7-401.4(J) .(Supp.2009). A relationship that is “bona fide” is one made “in good faith[,] without fraud or deceit.” Black’s Law Dictionary 168 (7th ed. 1999). Furthermore, a “bona fide guest” is a person “for whom the member has made prior arrangements with the management of the organization.” 23 S.C.Code Ann. Regs. 7-401.4(K) (Supp.2009).

We find the ALC abused its discretion in denying the Department’s request to revoke Blue Moon’s alcoholic beverage license and permit. Nonprofit organizations are constitutionally prohibited from opening their doors to the general public. S.C. Const, art. VIII-A. Rather, they may serve certain alcoholic beverages only to their members and the bona fide guests of those members. 23 S.C.Code Ann. Regs. 7-401.4(J) (Supp.2009). Here, Blue Moon placed an advertisement outside its door indicating a telephone number to call for admission. After Agent Ford, a stranger who desired admission, called the number and asked to be allowed inside, Blue Moon’s employee/member advised the doorman to admit the man. According to the record, “Agent Ford did not know anyone in the club and had no idea [to whom] he spoke ... on the phone.”

Noting the nonbinding effect of a prior decision of an ALC judge, the ALC judge cites as informative the decision of Judge Geathers in S.C. Dep’t of Revenue v. Mir, Inc. d/b/a Alley Gator Sports Bar & Grill, 04-ALJ-17-0409-CC (S.C. [472]*472Admin. Law Ct. filed May 31, 2005). In that case, Judge Geathers found no violation of regulation 7-401.4(J) where the non-member agent entered the private club5 and struck up a conversation with a member, who subsequently signed the agent in as his guest. We note that the focus of Judge Geathers’s decision was not whether the member in that case made a “prior arrangement” with management to have the agent admitted as his guest but whether the agent accompanied the member onto the premises. The ALC further cites from Judge Geathers’s decision for the proposition that the regulation “does not require that the member and his guest be longstanding friends since childhood or even prior acquaintances of several meetings, but rather only that the member genuinely, sincerely, and without fraud or deceit, intends a person to be his guest at the club, even if he has only just met the person.” Judge Geathers concluded there was nothing in the evidence to suggest that the member intended anything other than to register the nonmember agent as his bona fide guest.

The ALC concludes “the plain language of the regulation speaks for itself. A prior arrangement, of no definite duration, between management and a member is sufficient to permit a legal admission of a non-member guest.” We think the ALC placed undue emphasis on the “prior arrangement” language of the regulation without regard for the context in which it is used. The words of a statute must be given their plain and ordinary meaning without resorting to subtle or forced construction to limit or expand that statute’s operation. The language must be read in a manner which “harmonizes with its subject matter and accords with its general purpose.” See Mun. Ass’n of S.C. v. AT & T Communications of Southern States, Inc., 361 S.C.

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Related

South Carolina Department of Revenue v. Blue Moon of Newberry, Inc.
725 S.E.2d 480 (Supreme Court of South Carolina, 2012)
South Carolina Dept. of Revenue v. Blue Moon of Newberry, Inc.
693 S.E.2d 21 (Court of Appeals of South Carolina, 2010)

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Bluebook (online)
693 S.E.2d 21, 387 S.C. 467, 2010 S.C. App. LEXIS 40, Counsel Stack Legal Research, https://law.counselstack.com/opinion/south-carolina-dept-of-revenue-v-blue-moon-of-newberry-inc-scctapp-2010.