Opinion
23-ALJ-17-0412-AP
10-18-2023
South Carolina Department of Revenue, Petitioner, v. Habiba Restaurant, LLC, d/b/a Habiba Restaurant, LLC,Respondent.
For the Petitioner Patrick A. McCabe, Esquire For the Respondent John R. Alphin, Esquire
For the Petitioner Patrick A. McCabe, Esquire
For the Respondent John R. Alphin, Esquire
FINAL ORDER
Deborah Brooks Durden, Judge
STATEMENT OF THE CASE
This matter comes before the South Carolina Administrative Law Court (ALC or Court) for a contested case hearing to determine whether Habiba Restaurant, LLC, d/b/a Habiba Restaurant, LLC, (Respondent) knowingly permitted acts that constitute a public nuisance in violation of S.C. Code Ann. section 61-4-580(A)(5), and whether Respondent failed to maintain a reputation for peace and good order in the community as required by S.C. Code Ann. section 61-6-1820.
The South Carolina Department of Revenue (Department) is seeking to revoke the On-Premises Beer and Wine Permit (Permit) and Restaurant Liquor by the Drink License (License) of Respondent. Respondent requested a contested case hearing to dispute this decision on the grounds that it did not knowingly permit an act which tends to create a public nuisance upon its premises and that it met the requirements of S.C. Code Ann. section 61-6-1820. A hearing was held before this Court on October 13, 2023.
ISSUES
1. Whether Respondent violated S.C. Code section 61-4-580(A)(5) or S.C. Code Ann. section 61-6-1830.
2. If so, whether revocation of Respondent's Permit and License is the appropriate penalty for the violations.
FINDINGS OF FACT
Having observed the testimony of the witnesses and exhibits presented at the hearing and closely passed upon their credibility, the Court makes the following Findings of Fact by a preponderance of evidence:
Respondent holds an On-Premises Beer and Wine Permit and a Restaurant Liquor by the Drink License for its business at 528 Haywood Road, Greenville, South Carolina 29607. Another licensed location exists at the same address in suite A. Both establishments share a common parking lot.
On July 30, 2023, Special Agent C. Evans (Evans) with the South Carolina Law Enforcement Division (SLED) was advised of a request for assistance by the Greenville City Police Department in reference to Respondent's establishment. Following this request for assistance, Evans began a nuisance investigation into Habiba Restaurant and determined sufficient evidence was present to issue two administrative violations. The first violation was for knowingly permitting an act which tends to create a public nuisance as prohibited by S.C. Code Ann. section 61-4-580(A)(5). The second charged that Respondent failed to maintain a reputation for peace and good order in the community as required by S.C. Code Ann. section 61-6-1820. Following these findings, the Department sought the immediate suspension of Respondent's Permit and License, because it believed the "public health, safety or welfare imperatively require[d] emergency action" and sought the revocation of Respondent's Permit and License.
Prior to the hearing on the Department's emergency motion, the parties notified the Court that an agreement had been reached as to the emergency motion and that the Respondent had agreed to voluntarily close until the Court could hear the Department's Petition to Revoke on an expedited basis.
At the hearing on this matter, a lieutenant with the City of Greenville Police Department and Evans testified about a large number of incidents that occurred at 528 Haywood Road. Both the lieutenant and Evans testified that the vast majority of incidents occurred after 11:00 P.M. and all occurred in the parking lot that is shared between Respondent's business and another licensed establishment. The direct testimony only tied one of the incidents in the parking lot to Respondent's establishment. In addition, both testified that closing at 11:00 P.M. would alleviate the problem.
Respondent's sole owner, Mohammed Edris (Edris) testified that he was aware of some of the incidents that occurred at 528 Haywood Road and that he and his staff had reached out to law enforcement on numerous occasions. He further testified that prior to the administrative violations in this case, he had never received a violation from the City of Greenville or SLED. He also testified that following a visit from the City of Greenville Police Department in 2019, he began hiring private security officers and worked with the Police Department on issues in the parking lot at 528 Haywood Road. The problems were resolved but started again earlier this year. Respondent hired off duty police officers to work in the parking lot and the issues have subsided.
Prior to the issuance of the administrative violations, Respondent had begun work to renovate and change the establishment. Edris testified he spent approximately $30,000.00 in the process and completely renovated the location. Respondent also changed its menu and planned to change its hours of operation. Edris testified that he was making the following changes to his establishment:
a. Respondent was changing its hours of operation to close no later than 11:00 P.M. with last call being at 10:30 P.M.;
b. Respondent would begin serving lunch on each day it was open;
c. Respondent would no longer have live music;
d. Respondent would no longer employ a DJ;
e. Respondent would obtain scanning technology for IDs and will use those scanners for all alcohol sales; and
f. Respondent was changing the name it does business under.
CONCLUSIONS OF LAW
Based upon the above Findings of Fact, the Court concludes the following as a matter of law:
S.C. Code Ann. § 1-23-600 (Supp. 2016) grants jurisdiction to this Court to hear contested cases under the Administrative Procedures Act. Specifically, SC Code Ann. § 61-2-260 (2010) grants the ALC the authority to hear contested case hearings in matters governing alcoholic beverages, beer, and wine. S.C. Code Ann. § 61-2-20 (2010) charges the Department with the responsibility of administering and enforcing the laws and regulations governing beer and wine. The standard of proof in these administrative proceedings is a preponderance of the evidence. Anonymous v. State Bd. of Med. Exam'rs, 329 S.C. 371, 496 S.E.2d 17 (1998).
Permits and licenses issued by this State for the sale of liquor, beer, and wine are privileges to be used and enjoyed only so long as the holder complies with the restrictions and conditions governing them. See Feldman v. S.C. Tax Commission, 203 S.C. 49, 26 S.E.2d 22 (1943).
After considering the weight of all the evidence presented, I find that the private parking lot that Respondent shares with several other businesses has become a gathering place for individuals who engage in behavior that is a nuisance to the community and a drain on law enforcement resources. Although Respondent's business may not bear the sole responsibility for allowing this nuisance behavior, Respondent is responsible for controlling the behavior of customers in its parking lot and surrounding premises. See Roche v. S.C. Alcoholic Beverage Control Comm'n, 263 S.C. 451, 211 S.E.2d 243 (1975). Therefore, I find that Respondent has knowingly allowed nuisance behavior on its premises.
Based upon the above Findings of Fact, the Court concludes the following as a matter of law:
1.Section 1-23-600 of the South Carolina Code grants jurisdiction to this Court to hear contested cases under the Administrative Procedures Act (APA). S.C. Code Ann. § 1-23-600 (Supp. 2023).
2.The Administrative Law Court also has exclusive jurisdiction to adjudicate contested matters involving the regulation of alcoholic beverages under Title 61 of the South Carolina Code. See S.C. Code Ann. § 61-2-260 (2022). "The APA applies the rules for contested cases to license grant, denial, and renewal issues requiring notice and hearing." South Carolina Dept. of Revenue v. Club Rio, 392 S.C. 636, 642, 709 S.E.2d 690, 693 (Ct. App. 2011), citing S.C. Code Ann. § 1-23- 370(a) (2005).
3.The weight and credibility assigned to evidence presented at the contested case hearing is within the province of the administrative law judge. Hill v. S.C. Dep't of Health & Env't Control, 389 S.C. 1, 17, 698 S.E.2d 612, 621 (2010) (noting administrative discretion is a function of the Court when reviewing contested cases under the APA).
4.The standard of proof in administrative proceedings is a preponderance of the evidence unless otherwise specified. Anonymous v. State Bd. of Med. Exam'rs, 329 S.C. 371, 375, 496 S.E.2d 17, 19 (1988). Because the Department is seeking to impose an administrative penalty on Respondent, the Department has the burden of proof in this matter. SCALC Rule 29(B).
5. The Department seeks revocation of the Respondent's Permit and License pursuant to sections 61-6-1830 and 61-4-580(A)(5). Section 61-6-1830 grants the Department the authority to suspend, revoke, or refuse to renew a license if a licensee no longer meets the requirements of § 61-6-1820. The criteria for licensure under subsection 61-6-1820(a) requires an applicant to possess "a reputation for peace and good order in its community…" Here, the Department contends that Respondent has failed to excise these attributes in the day-to-day operation of its location. Similarly, section 61-4-580 grants the Department the authority to suspend or revoke a permit or license for a violation of its prohibitions. Section 61-4-580(A)(5) provides "[n]o holder of a permit authorizing the sale of beer or wine or a servant, agent, or employee of the permittee may knowingly commit any of the following acts upon the licensed premises covered by the holder's permit: … (5) permit any act, the commission of which tends to create a public nuisance … ." S.C. Code Ann. § 61-4-580(A)(5) (Supp. 2023) (emphasis added).
The Court finds that the greater weight of the evidence supports the violations cited in the Department's decision. While the Court is genuinely concerned about the criminal activity and the safety and welfare of the community in and around the subject location, the evidence suggests that the closing at 11:00 P.M. and elimination of live music will resolve the concerns raised by the Police Department and SLED. There is no evidence that Respondent has been irresponsible in its sale of alcohol or in the operation of the restaurant services. By disengaging from live music and closing at 11:00 P.M., Respondent should alleviate the dangers imposed on the community and the burdens placed on law enforcement. Therefore, the Court finds revocation of Respondent's permit and license is not the appropriate penalty.
IT IS HEREBY ORDERED that the Department's Petition to revoke Respondent's On-Premises Beer and Wine Permit and Restaurant Liquor by the Drink License is DENIED. Respondent's Permit and License shall continue in effect subject to the following conditions:
1) Respondent shall cease operations each night no later than 11:00 P.M. with alcohol sales ceasing no later than 10:30 P.M.;
2) Respondent shall serve lunch on each day the establishment is open;
3) there shall be no "live" or promoted events at the subject location, which shall include musicians, entertainers, or disc jockey. However, this does not preclude Respondent from playing music during the hours of operation; and
4) Respondent shall obtain scanning technology for identifications and will use said scanners for all alcohol sales.
AND IT IS SO ORDERED.