Tuesday, July 22, 2014

SC Administrative Law Court Decisions

CAPTION:
SCDOR vs. Collins Entertainment Corporation, d/b/a Collins

AGENCY:
South Carolina Department of Revenue

PARTIES:
Petitioners:
South Carolina Department of Revenue

Respondents:
Collins Entertainment Corporation, d/b/a Collins
 
DOCKET NUMBER:
98-ALJ-17-0390-CC

APPEARANCES:
Nicholas P. Sipe, Esquire for Petitioner

James H. Harrison, Esquire for Respondent
 

ORDERS:

FINAL ORDER AND DECISION

This matter comes before me pursuant to the Administrative Procedures Act, S.C. Code Ann. § 1-23-310 et seq. (1986 and Supp. 1997), upon a request for a contested case hearing by Collins Entertainment Corporation ("Collins") subsequent to the issuance by Petitioner Department of Revenue ("DOR") of citations for failing to attach owner identification to one video poker machine, in violation of S.C. Code Ann. § 12-21-2748 (Supp. 1997). DOR seeks a fine of $2,500 for the violation, pursuant to S.C. Code Ann. § 12-21-2738 (Supp. 1997). Collins argues that the penalty should be reduced in consideration of mitigating factors.

A contested case hearing was held in the matter at the Administrative Law Judge Division in Columbia, South Carolina, on September 14, 1998. Based upon the relevant and probative evidence and the applicable law, a fine of $1,500 is imposed for violation of S.C. Code Ann. § 12-21-2748, pursuant to S.C. Code Ann. § 12-21-2738 (Supp. 1997).

FINDINGS OF FACT

By a preponderance of the evidence, I find:

  1. On May 23, 1995, Collins Entertainment Corporation ("Collins") applied for a biennial coin-operated device license number 042751, which was affixed to a video poker machine it owned ("subject machine").
  2. On January 23, 1997, the subject machine was being operated at 1914 Augusta Highway, West Columbia.
  3. On January 23, 1997, agents of the State Law Enforcement Division (SLED) inspected the location at 1914 Augusta Highway, West Columbia, South Carolina for compliance with the Video Game Machine Act.
  4. On January 23, 1997, no owner identification label was attached to the subject machine.
  5. As a result of the January 23, 1997 inspection, on June 2, 1997, Collins was cited by DOR with an administrative violation of S.C. Code Ann. § 12-21-2748 for failure to attach owner identification to the subject machine.
  6. On March 3, 1998, DOR issued a final determination upholding its June 2, 1997 citation against Collins.
  7. After the SLED inspection, Collins placed an owner identification sticker on the subject machine. The sticker is covered by a plexiglass plate to prevent tampering by patrons.


CONCLUSIONS OF LAW

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

  1. Pursuant to S.C. Code Ann. § 12-4-30(D) (Supp. 1997) and S.C. Code Ann. § 1-23-600 (Supp. 1997), the Administrative Law Judge Division has jurisdiction to hear and decide this matter.
  2. Video poker machines authorized under S.C. Code § 12-21-2720(A)(3) (Supp. 1997) are termed Class III machines.
  3. The licensing, placement, and operation of video poker machines is subject to Title 12, Chapter 21, Articles 19, 20, and 21 of the S.C. Code, as amended.
  4. Licenses issued by the State are not rights or property, but are rather privileges granted in the exercise of the police power of the State to be used and enjoyed only so long as the restrictions and conditions governing them are complied with. The tribunal authorized to grant the issuance of a license is also authorized, for cause, to revoke or deny it. Feldman v. South Carolina Tax Comm'n, 203 S.C. 49, 26 S.E.2d 22 (1943).
  5. In video poker license violation cases, DOR bears the burden of proving its case by a preponderance of evidence. See National Health Corp. v. South Carolina Dept. of Health and Environmental Control, 298 S.C. 373, 380 S.E.2d 841 (Ct. App. 1989).
  6. Licensed Class III video poker machines must have information identifying the owner or operator of the machine attached on an area of the machine visible for inspection purposes. S.C. Code Ann. § 12-21-2748 (Supp. 1997).
  7. S.C. Code Ann § 12-21-2738 provides as follows:

A person who fails, neglects, or refuses to comply with the terms and provisions of this article or who fails to attach the require license to any machine, apparatus, billiard, or pocket billard 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 department.

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.

  1. Collins failed have attached owner identification to one video poker machine (042751), in violation of S.C. Code Ann. § 12-21-2748 (Supp. 1997).
  2. It is presumed that the legislature intended to accomplish something with a statute rather than to engage in a futile exercise. Berkebile v. Outen, 311 S.C. 50, 53-54, 426 S.E.2d 760, 762 (1993).
  3. Section 8A of Act 53 of 1997 removed the phrase "no part of which may be suspended" from Section 12-21-2738, effective June 6, 1997; therefore, the legislature intended that a mandatory penalty of $2,500 no longer be applicable.
  4. A fine of $1,500 is appropriate in this matter, in light of the mitigating actions taken by the Respondent to prevent the violation from recurring.
  5. Any issues raised or presented in the proceedings or hearing of this case not specifically addressed in this Order are deemed denied. ALJD Rule 29(C).


ORDER

IT IS THEREFORE ORDERED that Collins Entertainment Corporation must pay a penalty of $1,500 for violation of S.C. Code Ann. § 12-21-2748 (Supp. 1997).

AND IT IS SO ORDERED.

__________________________________

STEPHEN P. BATES

ADMINISTRATIVE LAW JUDGE

October 14, 1998

Columbia, South Carolina