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High Court of New Zealand Decisions |
Last Updated: 25 May 2018
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IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-Ā-TARA ROHE
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CIV-2017-404-1176
[2018] NZHC 1208 |
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UNDER
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the Sale and Supply of Alcohol Act 2012
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IN THE MATTER
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of an appeal pursuant to s 162 of the Act against a decision of the Alcohol
Regulatory and Licensing Authority in respect of
premises situated at 8 Barraud Street, Dannevirke, known as
“Dannevirke New World”
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BETWEEN
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MEDICAL OFFICER OF HEALTH (FOR THE MANAWATU HEALTH DISTRICT)
Appellant
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AND
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G & B HASLER LIMITED
Respondent
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AND
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PAVAN SHARMA RAGLAN LIMITED AND GENERAL DISTRIBUTORS
LIMITED
Interveners
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Hearing:
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31 October and 1 November 2017
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Appearances:
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C P Browne and R J Sussock for Appellant I J Thain for Respondent
A W Braggins for Intervener
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Judgment:
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25 May 2018
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JUDGMENT OF CLARK J
Pursuant to r 11.5 of the High Court Rules I direct the delivery time of this judgment is 4:30 pm on 25 May 2018
MEDICAL OFFICER OF HEALTH (FOR THE MANAWATU HEALTH DISTRICT) v G & B HASLER LIMITED [2018] NZHC 1208 [25 May 2018]
Introduction [1]
Background [3]
District Licensing Committee decision [5]
Alcohol Regulatory and Licensing Authority decision [10]
The appeal [14]
Approach to appeal [15]
Grounds of appeal [18]
Issues for determination [20]
Statutory framework [23]
Issue one: Is the obligation to “describe” an single alcohol area, satisfied by delineating the perimeter of the proposed area on a plan of the premises or must the plan show also the proposed configuration
and arrangement of alcohol within the single alcohol area? [32]
Appellant’s position [32]
Respondent’s position [35]
Assessment [37]
Issue two: Does a single-area condition, once imposed under s 112(2) prohibit any changes to the configuration and arrangement
within the alcohol area? [49]
Appellant’s position [50]
Respondent’s position [55]
Assessment [56]
Issue three: To what extent may conditions under s 117 be imposed on a licence for the purpose of restricting arrangement or
configurations within the alcohol area? [62]
Appellant’s position [62]
Respondent’s position [67]
Assessment [69]
Conclusion [78]
Answers to questions of law [80]
Summary [88]
Result [91]
Introduction
[1] The Sale and Supply of Alcohol Act 2012 (the Act, or the 2012 Act) limits the exposure of shoppers in supermarkets and grocery stores to displays and promotions of alcohol by confining the display and promotion of alcohol to one dedicated area within the premises. Such an area is called an “alcohol area”. When an off-licence is issued or renewed the licensing body delineates the alcohol area by means of a plan of the premises and imposes as a condition of the licence the delineation, or description,
of the area to which the display and promotion of alcohol is restricted.1 The condition is termed a “single-area condition”.2
[2] The principal issue raised by this appeal concerns the effect of a single-area condition and whether it prohibits a licensee from adjusting the location and display of alcohol within the alcohol area.
Background
[3] Gary Hasler is the operator of New World Dannevirke and the director of the respondent, G & B Hasler Ltd (Hasler). The supermarket is franchised to Foodstuffs North Island Ltd. With the anticipated enactment of the 2012 Act the premises were reconfigured to create an alcohol area. The floorplan supplied to the Tararua District Licensing Committee (DLC) with the application for renewal depicted the position of shelving units within the alcohol area.
[4] When the alcohol area was actually fitted out the layout of the shelving units differed from the depiction in the plan accompanying the application. Instead of being at right angles to the wall as depicted in the plan, some of the display units were positioned at an angle. The rearrangement of the shelves and angling of the units was intended to maximise the use of the floor space within the alcohol area.
District Licensing Committee decision
[5] Neither the Police nor the licensing inspector opposed Hasler’s application for renewal of the licence. Nor was there any public objection to the application. The Medical Officer of Health, however, opposed Hasler’s application on the grounds the application:
(a) failed to “limit (so far as is reasonably practicable) the exposure of shoppers in supermarkets and grocery stores to displays and promotions of alcohol, and advertisements for alcohol”;3 and
1 Sale and Supply of Alcohol Act 2012, s 112(2).
2 Section 112(3).
3 Section 112(1).
(b) contravened the prohibition on display or promotion of alcohol outside the alcohol area.4
[6] The Medical Officer of Health accepted that according to Hasler’s new design, the alcohol is restricted to one area, in the corner of the store, but suggested exposure to the alcohol may have been increased by Hasler’s rearrangement compared to other possible configurations, for example an enclosed aisle. Practically speaking the Medical Officer of Health was concerned that aisle-end displays of alcohol projected towards the main body of the supermarket; that signage could be seen from outside the alcohol area; and that the angled shelves increased, rather than minimised, the exposure of alcohol products to customers passing by the alcohol area.
[7] The Medical Officer of Health recommended to the DLC that the display units not be angled and that the large signs on the wall be removed. The Medical Officer prepared a diagram for the DLC. It is Attachment 1 to this judgment. The solid lines depict the layout on the floor plan submitted with the application. The superimposed dotted lines represent the layout observed during the Medical Officer of Health’s site visit.
[8] Following a site visit, the DLC concluded the angled position of the shelves made “little or no difference” to the exposure of shoppers to alcohol and were not in breach of s 114(1)(a) of the Act. In relation to advertising, signage at the end of the aisles and on the walls were not in breach of s 112 and 114.5 There was no display or promotion of, or advertisement for, alcohol on the premises outside the single alcohol area. The DLC considered, however, the large sign advertising “Ice Cold Beer” at the end of the refrigeration unit, had visual appeal, could be seen from outside the single alcohol area and consequently “may not comply” with the “spirit of the Act”.6 The DLC required the “Ice Cold Beer” sign to be reduced in size or removed.7
4 Section 114(1)(a).
5 Re G & B Hasler Ltd Tararua DLC 41/DEC/143/2015, 30 October 2015 at 5.
6 At 5.
7 At 5.
[9] Overall, the DLC was satisfied the application met the criteria for the renewal of a licence and granted the renewal.8
Alcohol Regulatory and Licensing Authority decision
[10] The Medical Officer of Health appealed the DLC’s decision to the Alcohol Regulatory and Licensing Authority (the Authority). The issues before the Authority concerned the interpretation of ss 112 to 114 of the Act. The Authority formulated the following two issues for its determination:
(a) Must a single-area condition imposed pursuant to s 112(2) express more than the outer perimeter of a single alcohol area and if the answer is ‘yes’ does s 112(1) constrain the rearrangement of shelving and displays?9
(b) If the answer is ‘no’ did the DLC err in not imposing a condition pursuant to s 117 relating to the positioning of shelving and the aisle- end displays? A similar question arose in respect of the illuminated signage.10
[11] The Medical Officer of Health argued that if a plan is to satisfy s 113(2) of the Act it must show not only the footprint of the premises and the proposed configuration and arrangement of the premises and perimeter of the alcohol area but also the proposed configuration and arrangement of the alcohol area. It would be insufficient for a plan merely to show the perimeter of the alcohol area without also showing the arrangement of shelving and displays within the alcohol area.
[12] The Authority did not agree. The Authority determined s 112(2) requires a description of the alcohol area relative to the wider premises. The Authority reasoned that it is this “relative position” of the alcohol area that limits exposure of shoppers to the display, promotion and advertisement of alcohol in supermarkets and grocery
8 At 6.
9 Medical Officer of Health v G & B Hasler Ltd [2017] NZARLA PH 169 at [42].
10 At [43].
stores.11 While the definition of “premises” in s 5 includes any part of the premises, the Authority considered it strained the plain meaning of s 112(2) to read “premises” as meaning the internal space within the alcohol area when s 112(2) is concerned to describe an alcohol area relative to the premises.12
[13] The Authority dismissed the appeal and confirmed the DLC’s decision.
The appeal
[14] The Medical Officer of Health appeals the Authority’s decision. The interveners were granted leave to appear on a restricted basis.13 The interveners’ interest in this appeal arises from what their counsel, Mr Braggins, characterised as the potential crossover with an appeal filed by Pavan Sharma Raglan Ltd against a decision of the Waikato District Licensing Authority in relation to SuperValue Raglan which is presently before the Authority.
Approach to appeal
[15] Where a party to proceedings before the Authority is dissatisfied with a determination of the Authority “as being erroneous in point of law, that party may appeal to the High Court [on that question of law]”.14
[16] The limitations of an appeal under s 162 of the Act were described by Gendall J in Christchurch Medical Officer of Health v J & G Vaudrey Ltd:15
... an appeal pursuant to s 162 of the Act ... is limited to points of law alone. This Court will not interfere with a decision unless it can be shown that the decision maker erred in law, accounted for irrelevant matters, failed to account for relevant matters, or was plainly wrong. Factual challenges, whether raised squarely or obliquely, will not be entertained on appeals of this kind, save to the extent they are capable of establishing that the decision appealed is plainly wrong. This is necessarily a very high threshold.
11 At [50].
12 At [51].
14 Sale and Supply of Alcohol Act, s 162(1).
[17] An error of law may arise if the Authority has reached a factual finding that is “so insupportable – so clearly untenable – as to amount to an error law”.16 As Gendall J observed a very high threshold is to be met if the appeal seeks to challenge factual matters.
Grounds of appeal
[18] The Medical Officer of Health’s notice of appeal particularises six grounds of appeal. In summary, it is said the Authority:
(a) incorrectly interpreted relevant provisions in the Act;
(b) failed to comply with statutory requirements;
(c) failed to impose a single-area condition that complied with the purpose of ss 112–114;
(d) failed to impose appropriate conditions under s 117;
(e) failed to consider whether Hasler’s concession regarding removal of the “Ice Cold Beer” sign ought to have been the subject of a condition; and
(f) erroneously considered the decision not to impose a condition under s 117 was discretionary.
[19] Eight questions of law are said to arise from the grounds of appeal:
(a) In describing a single alcohol area under s 113, is the delineation of the perimeter of a “blank area” on a plan of the premises sufficient having regard to the provisions of s 113(2)(a) and the nature of the decision required by s 113 as set out in J & C Vaudrey Ltd Ors v Canterbury Medical Officer of Health [2016] NZCA 539 at [33] and [45]?
(b) Is the configuration and arrangement of premises important solely for the purposes of the restriction in s 113(5) or is it also important for the purposes of the third step in defining a single alcohol area, set out in J & C Vaudrey Ltd Ors v Canterbury Medical Officer of Health [2016] NZCA 539 at [33] and [45]; namely to consider whether the
16 Bryson v Three Foot Six Ltd [2005] NZSC 34, [2005] 3 NZLR 721 at [26].
description limits, so far as reasonably practicable, the exposure of shoppers to displays and promotions of alcohol and advertisements for alcohol?
(c) Does the description of the alcohol area required by s 113 include the proposed configuration and arrangement of the alcohol area itself and not merely its perimeter such that the description does not permit the applicant to re-configure or re-arrange the alcohol area as it pleases without approval of the District Licensing Committee or Authority?
(d) Would (and, if so, to what extent) the imposition of conditions restricting reconfiguration or re-arrangement of the premises, including the single alcohol area, have the effect of altering the described single alcohol area itself as that term was used by the Court of Appeal in J & C Vaudrey Limited & Ors v Canterbury Medical Officer of Health [2016] NZCA 539?
(e) Can s 117 be used to impose a condition prohibiting aisle-end displays in the single alcohol area?
(f) If permitted, would conditions like those referred to in (d) and (e) require additional justification beyond the statutory presumption in s 112 that exposure to displays of alcohol products and their promotion by shoppers in supermarkets and grocery stores creates a risk of harm?
(g) If applicants offer to accept restrictions on the use or configuration of a proposed alcohol area in the course of the application or its hearing relating to a single alcohol area condition, should such restrictions be the subject of an appropriate condition under s 117 when the application is granted?
(h) Is the failure to do so, having earlier decided that a particular offered restriction was appropriate, the exercise of a discretion which cannot be challenged on appeal?
Issues for determination
[20] Counsel for the respondent, Mr Thain, suggested the disposition of the appeal requires resolution of only three central issues. Counsel for the appellant, Mr Browne, submitted the first three questions of law relate to the configuration and arrangement of the alcohol area and should be considered together as the underlying issues are intertwined. The remaining five questions of law relate to the imposition of further conditions pursuant to s 117 of the Act.
[21] Adapting the suggested approaches, I have decided it is most useful to proceed by way of an analysis of the essential issues arising from the appellant’s questions of law. There are three essential issues:
- Is the obligation to “describe” an alcohol area, satisfied by delineating the perimeter of the proposed area on a plan of the premises or must the plan show also the proposed configuration and arrangement of alcohol within the alcohol area?
[22] My analysis of these issues will enable me to return, at the end of the analysis, to answer the questions of law posed in the notice of appeal.17
Statutory framework
[23] Before turning to the questions for determination it is necessary to discuss the legislative framework.
[24] The Sale and Supply of Alcohol Act “signals a new community-oriented approach incorporating both purpose and object provisions”.18 The purpose of the Act is to put in place a new system of control over the sale and supply of alcohol.19 The characteristics of the system are that it is reasonable and its administration helps to achieve the object of the Act.20
[25] The object of the Act set out in s 4(1) is that –
(a) the sale, supply, and consumption of alcohol should be undertaken safely and responsibly; and
(b) the harm caused by the excessive or inappropriate consumption of alcohol should be minimised.
17 The appellant’s questions of law are set out above at [19].
19 Sale and Supply of Alcohol Act, s 3(1).
20 Section 3(2).
[26] Subpart 3 of Part 2 of the Act deals with applications for on-licences, off- licences and club licences. An application is filed with the licensing committee in the district in which the relevant premises is situated.21 The application must comply with the requirements of s 100 and is to be in the form prescribed in the schedule to the Sale and Supply of Alcohol Regulations 2013. The Regulations specify documents which must accompany an application. One such document is a:22
... Floor plan showing any proposed permitted area for display and promotion of alcohol, and any proposed sub-areas.
[27] On receiving an application for a licence the secretary of the relevant licensing committee must send to the Police, the relevant licensing inspector and Medical Officer of Health, a copy of the application and attachments.23 The Police and Medical Officers must inquire into the application. The opportunity these reporting agencies have to oppose the application recognises:24
[their unique placement] to put before the Authority relevant and specialised evidence which may assist [a decision-maker] in discharging its functions under the Act.
[28] The criteria to which the licensing committee or authority must have regard when determining applications are prescribed in s 105 (for the issue of licences) and s 131 (in the case of renewals).
[29] Where an off-licence is to be issued or renewed for supermarkets or grocery stores the decision-maker must impose a condition relating to the area in which alcohol is to be displayed and promoted:
(1) The purpose of this section and sections 113 and 114 is to limit (so far as is reasonably practicable) the exposure of shoppers in supermarkets and grocery stores to displays and promotions of alcohol, and advertisements for alcohol.
21 Section 99.
22 Form 4 in the schedule to the Sale and Supply of Alcohol Regulations 2013.
23 Sale and Supply of Alcohol Act, s 103.
(3) On the renewal of an off-licence for premises that are a supermarket or grocery store, any single-area condition imposed when the licence was issued (or was last renewed) expires.
(4) Subsection (3) is subject to section 115(4).
[30] Section 113 prescribes the way in which an alcohol area must be delineated. The Act uses the expression “describe”.
(1) The licensing authority or licensing committee concerned must have regard to section 112(1)—
(a) when describing an alcohol area; and
(b) when taking any other action under this section; and
(c) when forming any opinion for the purposes of this section.
(2) An alcohol area must be described by means of a plan of the footprint of the premises concerned (or, in the case of premises on more than one level, a plan of the footprint of the level on which the area is or is to be located) showing—
(a) the proposed configuration and arrangement (or, in the case of the renewal of a licence, the existing or any proposed new configuration and arrangement) of the premises or level; and
(b) the perimeter of the area.
...
(4) The perimeter of the area or any sub-area may pass through the proposed locations (or, in the case of the renewal of a licence, any existing or proposed new locations) of any display units.
(5) The authority or committee must describe an alcohol area within the premises only if, in its opinion,—
(a) it is a single area; and
(b) the premises are (or will be) so configured and arranged that the area does not contain any part of (or all of)—
(i) any area of the premises through which the most direct pedestrian route between any entrance to the
premises and the main body of the premises passes; or
(ii) any area of the premises through which the most direct pedestrian route between the main body of the premises and any general point of sale passes.
(6) For the purposes of this section and section 114, general point of sale means anything that is—
(a) a checkout, till, or cashbox where goods other than alcohol (or alcohol and goods other than alcohol) may be bought; or
(b) a device by which goods other than alcohol (or alcohol and goods other than alcohol) may be paid for without the involvement of any person other than the buyer.
[31] The consequences and effect of a single-area condition, once imposed on a licence, are set out in s 114:
(1) Every single-area condition takes effect as a condition that the licensee of the premises concerned must ensure that—
(a) no display or promotion of, or advertisement for, alcohol occurs on the premises at any place outside the alcohol area; and
(b) the premises are not reconfigured or rearranged in a way whose effect (whether intentional or not) is that the alcohol area contains—
(i) any area of the premises through which the most direct pedestrian route between any entrance to the premises and the main body of the premises passes; or
(ii) any area of the premises through which the most direct pedestrian route between the main body of the premises and any general point of sale passes.
(2) If the alcohol area has not been so described that it is divided into 2 or 3 sub-areas, a single-area condition also takes effect as a condition that the licensee of the premises concerned must ensure that no display or promotion of, or advertisement for, a product that is not alcohol occurs on the premises at any place inside the alcohol area.
...
(4A) The effect of a single-area condition set out in subsections (1) to (4) does not apply in relation to the display or promotion of, or the advertisement for, low-alcohol or non-alcoholic beer, wine, or mead.
(5) For the purposes of this section,—
(b) neither of the following is a promotion of alcohol:
(i) a sign (consistent with other general signage in the supermarket or grocery store concerned) giving directions to, or describing the location of, an area where alcohol is available for purchase:
(ii) a newspaper, magazine, or catalogue containing a promotion of or advertisement for alcohol; and
(b) described means described under section 113; and
(c) designated means designated under section 113(3)(b); and
(d) low-alcohol or non-alcoholic beer, wine, or mead means a product that is specified in section 58(1)(a) to (d) but that is not alcohol.
Issue one: Is the obligation to “describe” an single alcohol area, satisfied by delineating the perimeter of the proposed area on a plan of the premises or must the plan show also the proposed configuration and arrangement of alcohol within the single alcohol area?
[32] The Medical Officer’s case is that the requirement in s 113(2) of the Act to show configuration and arrangement includes the alcohol area. The Authority’s reasoning does not address the actual language of the statute.
[33] The internal configuration of the alcohol area is required to be shown on the plan. The appellant derives support for his position from s 113(4) which permits the perimeter of the area to pass through the location or proposed location of any display units. Mr Browne submitted if the internal configuration of the alcohol area were not included on the plan, s 113(4) would have no application.
[34] Mr Browne submitted J & C Vaudrey contains “an inherent presumption that the configuration of the entire premises would be shown”.25 The floor plan required by Form 4 of the Sale and Supply of Alcohol Regulations to be attached to an application does not expressly require configuration and arrangement within the
25 Citing J & C Vaudrey Ltd v Canterbury Medical Officer of Health, above n 18, at [47].
alcohol area. Yet the configuration and arrangement of the premises must include the configuration of the alcohol area because:
(a) s 113(2) requires the configuration of the premises to be shown on the plan by which the licensing body describes the alcohol area; and
(b) the configuration of the alcohol area is relevant to the evaluative exercise required of the licensing body when imposing a single-area condition.
Respondent’s position
[35] The respondent’s position is that a single-area condition operates only to restrict to a single place or location, in a supermarket or grocery store, displays and promotions of and advertisements for alcohol. A single-area condition does not otherwise restrict or control the displays, promotions or advertisements within the alcohol area.
[36] The respondent relies on the words of s 112(2) and 113(2) which require an alcohol area to be described by means of a plan of the footprint of the premises and the proposed configuration and arrangement of the premises. Relying on J & C Vaudrey, Mr Thain submitted once an off-licence is granted the licensee may alter the configuration and arrangement of the premises provided the outcome is not prohibited by s 114(1)(b).26
Assessment
[37] The Court of Appeal’s review of the context in which the Sale of Liquor Act 1989 was repealed and replaced with the 2012 Act is helpful in shedding light on the interpretation of the provisions engaged by this appeal.27
[38] The catalyst for reform was the release of the Law Commission’s report
Alcohol in our lives: curbing the harm in 2010.28 At the time there were no specific
26 At [53].
27 At [14]–[21].
28 Law Commission Alcohol in our lives: curbing the harm (NZLC R 144, 2010).
rules regarding the placement of alcohol in supermarkets. The placement of alcohol in supermarkets was of concern because its placement impacted price and availability both said to be key factors affecting levels of alcohol-related harm.29 The Law Commission reported that the placement strategy to ensure alcohol is highly visible increases the likelihood of casual impulse purchases of alcohol and places unhealthy pressure on vulnerable groups such as children and young people and those with alcohol dependency problems.30
[39] While accepting a single-area restriction would constitute an interference in the way supermarkets operate, the Law Commission considered a new Act restricting the placement of alcohol to a single area in stores would represent a paradigm shift in the way alcohol is sold in New Zealand.31 A single-area restriction would still allow for greater or lesser amounts of shelf or floor space to be used for alcohol so long as it remained in a single area. Product placement restrictions in supermarkets is not without precedent particularly (referring to the restrictions on cigarette placement).32 The Law Commission proposed a “single-area restriction” similar to the requirements of the Victorian legislation:33
This would seem to be a sufficient control on the placement of alcohol within a supermarket. To impose a greater degree of separation, similar to that in New South Wales, would appear to impose too great a cost on retailers at this stage. The law would restrict the display of all alcohol products to one area. Conceivably this could be more than one aisle if the supermarket required this. However, there should be no displays of alcohol products at the supermarket’s entrance or at checkouts, as these positions seem to be areas of particular vulnerability for supermarket patrons.
[40] While the original form of the Alcohol Reform Bill 2010 did not contain a single-area restriction in relation to supermarkets the Justice and Electoral Committee responded to public submissions by recommending a new clause requiring the display of alcohol in only one area of a store, that one area not being in a prominent area of the store, and restricting alcohol advertising and promotions to that designated area.34 What is now s 113(5), restricting the alcohol area to a part of the premises not on a
29 At [8.82].
30 At [8.87]–[8.88].
31 At [8.95].
32 At [8.96].
33 At [8.98].
34 Alcohol Reform Bill 2010 (236–2) (select committee report) at 4.
typical pedestrian route (for example to the checkout, or between an entrance and the main body of the premises) had its genesis in the Law Commission’s location proposal, and then the Select Committee’s location recommendation.
[41] Thus, the intention, enacted in ss 112–114, is to restrict the location of the alcohol area. By restricting displays, promotions and advertisements to one dedicated area, away from the prominent areas of the store, the exposure of shoppers to alcohol has been restricted as intended by the legislature.
[42] Turning to the relevant provisions, the starting point is the obligation in s 112(2) on the licensing body when issuing or renewing a licence. The licensing body must:
...[impose] on the licence a condition describing one area within the premises as a permitted area for the display and promotion of alcohol.
[43] By operation of s 113(2):
an alcohol area must be described by means of a plan of the footprint of the premises showing—35
(a) the proposed configuration and arrangement (or, in the case of the renewal of a licence, the existing or any proposed new configuration and arrangement) of the premises or level; and
(b) the perimeter of the area.
[44] Subsection (2) draws a clear distinction between the requirement for a plan of the footprint of premises showing the configuration and arrangement of the premises, and the bare requirement to show the perimeter of the alcohol area. The reason for the distinction is obvious:
(a) An alcohol area must be delineated so that it avoids:
main body of the premises passes;36 and
(b) The configuration and arrangement of the premises must be provided with an application for a licence because those details are relevant to the licensing authority’s determination of the application.
(c) If ignorant of the configuration and arrangement of the premises – the entrance, the main body of the premises, the pedestrian route through the main body of the store – a licensing body cannot form the necessary opinion about whether the alcohol area contains any proscribed area of the premises. While “main body” is not defined, it seems to me that if a shopper is able to enter the store, select items for purchase, and take them to the point of sale without passing through a delineated alcohol area, the shopper has taken “the most direct pedestrian route between any entrance and the main body of the premises” and “between the main body of the premises and any general point of sale passes”.38
(d) Plans submitted with applications will highlight the checkout counters, the entrance to the store, and delineate the alcohol area. They may also describe the nature of the goods available from main areas of the store (such as aisles of “frozen food”), and the nature of goods displayed adjacent or near to the alcohol area. The licensing authority will be able to assess from the configuration and physical arrangement of the premises detailed on the plan, whether the alcohol area is in a proscribed part of the premises.
(e) Manifestly, the layout of shelving and alcohol within the alcohol area,
36 Sale and Supply of Alcohol Act, s 113(5)(b)(i).
37 Section 113(5)(b)(ii).
38 Section 113(5)(b)(i)-(ii).
has no bearing on the decision to position the alcohol area. Sections 112–114 are concerned not with the arrangement of shelving or displays within the area but limiting the exposure of shoppers to displays of alcohol and that is achieved (principally) by ensuring its perimeter is not in an impermissible section of the store. It is for this reason that the bare perimeter of the alcohol area is to be shown on the plan accompanying the licence application. Details of configuration and arrangement such as those required for the premises are inapplicable to the space within an alcohol area.
[45] The point is illustrated by the actual plan of the Dannevirke New World premises which the respondent submitted with its application for renewal. A copy of that plan is Attachment 2 to this judgment. The perimeter of the alcohol area is described as required by s 113(2)(b). As can be seen, some shelving is indicated but, in my view, the plan would have been acceptable without the indicative layout. There is no requirement in the Act or the Regulations for that detail.
[46] The appellant relies on the definition of “premises” to support his contention that a plan showing the configuration and arrangement of the alcohol area is required. Premises is defined to include “part of any premises”.39 While that may be so it does not detract from the fact that throughout the Act, and more particularly in s 113(2) “premises” is used in contra-distinction to “area”. That distinction continues to operate in the context of the legislative requirement for a plan to show the proposed configuration and arrangement of the premises. Had the intention been to require the configuration and arrangement of the alcohol area then subs 113(2)(a) would have been drafted to include the area. For example:
An alcohol area must be described by means of a plan of the footprint of the premises concerned ... showing —
(a) the proposed configuration and arrangement ... of the premises ...
and the area.
[47] Further, where the intention is to regulate the environment within the alcohol area, that is made plain with the use of different language. Section 114 for example
39 Sale and Supply of Alcohol Act, s 5 definition of “premises”.
makes the distinction between displays of alcohol “outside” and “inside” the alcohol area.40
[48] It follows from the foregoing reasoning that the obligation to describe an alcohol area, which is imposed by s 113(2), is satisfied by delineating the perimeter of the proposed area on a plan of the premises. It is not necessary that the plan show the proposed configuration and arrangement of alcohol within the alcohol area.
Issue two: Does a single-area condition, once imposed under s 112(2) prohibit any changes to the configuration and arrangement within the alcohol area?
[49] The broad issue concerns the freedom of a licensee to arrange shelving, display units and such like within the alcohol area after a single-area condition has been imposed on the licence.
Appellant’s position
[50] The appellant’s position is that following the imposition of a single-area condition, a licensee may not reconfigure or rearrange the alcohol area without amendment of the single-area condition. The appellant seeks a declaration to that effect.
[51] In support of its view the appellant submits the Authority misinterpreted the Court of Appeal’s decision in J & C Vaudrey.41 The appellant’s position is grounded in his view that the single-area condition includes both the perimeter and its internal layout meaning the licensee cannot change the layout of the area without the approval of a licensing body. A contrary view would mean avoidance of what the appellant describes as “a third step in the evaluative exercise”. That third step is said to require an assessment of the level of exposure created by the internal layout of the area which constitutes part of the reason for requiring a description of the layout not simply its location.
40 Section 114(2).
41 J & C Vaudrey Ltd v Canterbury Medical Officer of Health, above n 18.
[52] A licensee would be able to modify the internal configuration of the single- area by applying to vary conditions under s 120 of the Act.
[53] If the internal configuration of the single-area was not part of the description of the single-area, the licensee could reconfigure the internal area in a way that defeats the s 112(1) purpose of limiting exposure.
[54] The appellant further submitted if the internal configuration is not part of the description of the single-area and is able to be changed at the whim of the licensee:
the result may be declined applications or the imposition of complex conditions under s 117 in which the DLC or ARLA attempts to predict and prohibit unacceptable reconfigurations.
Respondent’s position
[55] The respondent’s position is that a single-area condition is only a restriction to a single place or location in a supermarket or grocery store and does not otherwise restrict or control displays, promotions or advertisements. In reliance on the effect of s 114(1) of the Act, as analysed in J & C Vaudrey,42 the respondent submits even if the plan were to show an existing or proposed layout of the alcohol area the licensee would not be restricted to that layout.
Assessment
[56] The effect of a single-area condition is described in s 114. Every single-area condition takes effect as a condition that the licensee must ensure there is no display or promotion of, or advertisement for, alcohol outside the alcohol area and the premises are not reconfigured or rearranged in a way that defeats s 113(5).43 That is, the alcohol area is not to contain any part of what I have referred to as the proscribed areas.
[57] In my view ss 113 and 114(1) reflect the respective and complementary obligations of the decision-makers and licensees. Section 113 imposes on the decision-maker an obligation:
42 J & C Vaudrey Ltd v Canterbury Medical Officer of Health, above n 18.
43 Sale and Supply of Alcohol Act, s 114(1).
(a) to describe an alcohol area by reference to a plan of the footprint of the premises showing the configuration and arrangement of the premises, and the perimeter of the alcohol area;44
(b) to ensure, when describing an alcohol area, that it meets the prerequisites of location and placement required by s 113(5)(b); and
(c) to have regard for the s 112(1) purpose (to limit so far as is reasonably practicable the exposure of shoppers to displays and promotions of alcohol) when describing an alcohol area.45
[58] Once that area is described and becomes a condition of the licence, the obligation on the licensee mirrors the condition of the licence. The licensee must ensure:46
(a) there are no displays, promotions or advertisements for alcohol on the premises outside the alcohol area; and
(b) the premises are not to be reconfigured or rearranged so as to breach the requirements of placement and location of the area imposed by s 113(5)(b).
[59] The respondent referred to the “post-grant flexibility” which a licensee has to alter the configuration and arrangement of the premises. The Court of Appeal said:47
We agree that the effect of s 114(1) is that, once an off-licence is granted, the appellant may alter the configuration and arrangement of the premises provided the outcome is not as prohibited by s 114(1)(b).
[60] The Court of Appeal’s analysis of s 114(b), and the conclusion which I have just set out, was in the context of a different issue. The question was whether a licensing body could describe a single area that was materially different from an area proposed by an applicant. In that context, the Court of Appeal concluded the “post-
44 Section 113(2).
45 Section 113(1).
46 Section 114(1).
47 J & C Vaudrey Ltd v Canterbury Medical Officer of Health, above n 18, at [53].
grant flexibility” inherent in s 114(1) meant the licensing body can consider a proposed perimeter of a single area beyond that proposed by an applicant.48 The Court of Appeal’s discussion has no material bearing on the question whether an alcohol area can be reconfigured once it has been made the subject of a single-area condition. That said, I agree with the Authority, that the post-grant flexibility that enables a licensee to reconfigure or rearrange premises (without breaching the condition) does not impliedly prevent a licensee from reconfiguring the alcohol area.49
[61] The Authority correctly understood the legal effect of a single-area condition. The Authority’s understanding and interpretation is consistent with the legislative materials which the Court of Appeal found helpful and relevant to an analysis of these provisions. At all stages, including enactment of the single-area provisions, the intention has been to locate the alcohol area at a physical distance from shoppers. There has been no intention to control the configuration or arrangement within that area. Nor do the statutory provisions themselves contemplate that degree of interference. It follows that a single-area condition, of itself, does not prohibit changes to the way in which alcohol is displayed, promoted and advertised within the alcohol area.
Issue three: To what extent may conditions under s 117 be imposed on a licence for the purpose of restricting arrangement or configurations within the alcohol area?
[62] The appellant’s particular interest is with the potential of a decision-maker to restrict reconfiguration or rearrangement of an alcohol area and with prohibiting aisle- end displays in the alcohol area. The appellant relies on the broad conferral of discretionary power in s 117 that permits a licensing body to issue a licence subject to any reasonable condition not inconsistent with the Act.
[63] Mr Browne submitted the Authority’s approach to its power to impose a s 117 condition was in error because the following conclusion demonstrates its concern was
48 At [54].
49 Medical Officer of Health v G & B Hasler, above n 9, at [53].
limited to the locational aspects of the alcohol area rather than to limiting exposure as far as reasonably practicable:50
It follows from what we have already said, that as the alcohol area condition is to identify where in the premises alcohol may be displayed and promoted, thereby giving effect to the purpose set out in s 112(1), the licensee is entitled to use all of the space within the alcohol area, subject to any conditions imposed which do not have the effect of altering the area.
[64] The Authority erred in regarding conditions restricting configuration and arrangement as “altering” the single-area condition.
[65] Both the High Court and Court of Appeal decisions in J & C Vaudrey suggest that, wherever the particular circumstances of the licence application warrant it, conditions may be imposed in addition to the single-area condition, providing s 117 conditions do not have the effect of altering the location or perimeter of the alcohol area.
[66] Finally, Mr Browne submitted that if the internal configuration of the alcohol area is part of the condition and therefore unable to be changed, that outcome will affect the scope of s 117 conditions. If, on the other hand, all that a plan must show is the proposed configuration and arrangement of the premises and not the alcohol area, as a matter of logic s 117 is enlarged.
Respondent’s position
[67] Mr Thain submitted that it is not correct to suggest, as the appellant suggests, that a single-area condition is merely a perimeter condition. While the role of a licensing body is to describe only the perimeter of an alcohol area for the purposes of a single-area condition, the remaining terms, and effect, of the condition are as prescribed in s 114 of the Act. It is the single-area condition and its effect which cannot be altered by a s 117 condition.
[68] The inability to alter a single-area condition by a s 117 condition follows from the terms of s 117 itself which prohibits conditions inconsistent with the Act. Given
50 At [55].
ss 112 to 114 constitute a code conditions may not be made if they are inconsistent with ss 112 or 114.
Assessment
[69] Following the discussion of s 117 in Vaudrey the following characteristics of the power to impose a condition under s 117 are uncontentious:
(a) Section 117 confers a broad power to impose conditions.51
(b) The versatility of the power is amplified by s 118 which envisages different conditions applying to different parts of premises.52
(c) In view of the breadth of the power in s 117 it may be open to a licensing body to impose conditions under s 117 relating to matters such as displays within a single alcohol area if that would advance the object of the Act as set out in s 4.53
(d) Conditions may not be imposed under s 117 that have the effect of altering the single-area condition imposed under s 112(2).54
[70] The real question, and the issue at the heart of the appellant’s concern, is that the Authority failed to impose appropriate conditions under s 117 because it erroneously considered any conditions restricting configuration or arrangement of the alcohol area would have “the effect of altering the area”. In particular, the appellant seeks conditions prohibiting aisle-end displays in the alcohol area. For convenience I refer to such conditions as “aisle-end conditions”.
[71] Notwithstanding the scope of the power conferred by s 117, I would regard as impermissible the imposition of aisle-end conditions as a matter of course. Conditions imposed under s 117 must relate to a particular application and the issue of a particular licence. It may very well be that, from time to time, the licensing body considers it is
51 J & C Vaudrey Ltd v Canterbury Medical Officer of Health, above n 18, at [68].
52 At [68].
53 At [67] and [69].
54 At [70].
necessary to impose conditions, including a condition restricting aisle-end displays in the alcohol area, but the licensing body should be satisfied the condition is reasonable in the circumstances. It would not be reasonable to take a view that aisle-end displays of alcohol, of themselves, offend the purpose of the Act and for the licensing bodies to exercise what is effectively their judicial power for a legislative purpose namely to legislate aisle-end displays out of existence by way of imposition of conditions.55 The statutory purpose of limiting, so far as is reasonably practicable, the exposure of shoppers to displays and promotions of alcohol is achieved by the enactment of ss 112 to 114.
[72] I add this observation. There is no question that, in many respects, the reforms enacted in the 2012 Act were politically and socially charged. The provisions relating to the age of purchase, for example, were subject to a conscience vote.
[73] The point is, Parliament went only so far. There is a conspicuous difference, for example, between the 2012 Act and the Smoke-free Environments Act 1990 which prohibits tobacco products from being visible from any point within or outside the premises. All tobacco products on the premises must be stored to ensure they remain out of sight.56 The Law Commission reported that in many of the larger public forums there was strong support for applying the tobacco “smoke free” model to alcohol and the Law Commission considered that approach.57
[74] The Alcohol Reform Bill 2010 ultimately reflected politically acceptable compromises and politically feasible restrictions on advertising. The problematic placement strategy which ensured alcohol was highly visible, and increased the likelihood of casual impulse purchases58 was addressed by enacting a location restriction so that every off-licence would be issued subject to a condition describing one part of the premises as a permitted area for the display and promotion of alcohol.59
55 Cf Carr v State of Western Australia [2007] HCA 47 at [5].
56 Smoke-free Environments Act 1990, s 23A.
57 Law Commission, above n 28, at [19.125].
58 At [8.87].
59 Sale and Supply of Alcohol Act, s 112.
[75] The legislation does not place upon ss 112 to 114 the full burden for regulating the sale and supply of alcohol in order to achieve the object of the Act. These provisions do not call for an interpretation, or application, that exaggerates their intended purpose and effect. The Act’s regulation of sale and supply is effected through many other provisions which, for example: restrict the kinds of alcoholic products that can be sold in supermarkets and grocery shops;60 regulate trading hours;61 confer power to impose discretionary and compulsory conditions relating to off-licences, for example prescribing the people or kinds of people to whom alcohol may be sold or supplied;62 and create offences of irresponsible promotion of alcohol,63 or sale or supply of alcohol to minors,64 and so on.65
[76] Providing a licensee’s display and promotion of alcohol is consistent with the purpose of the single-area provisions — to limit so far as is reasonably practicable, the exposure of shoppers to alcohol — there is unlikely to be any reasonable basis for the imposition of conditions to further restrict the exposure. That, however, is a matter for the opinion of the licensing body. The expert opinions of the reporting agencies will be valuable to the licensing body but ultimately “it is a matter for the decision- maker to consider whether and to what extent the proposed single-area limits, so far as reasonably practicable, shoppers’ exposure to alcohol displays, promotions and advertisements”.66
[77] In this case the DLC made a site visit to the premises and formed the view the position of the shelves made little or no difference to the exposure of alcohol and their arrangement was not in breach of the Act. Having considered the DLC’s application of the relevant provisions and principles to the facts the Authority confirmed the DLC’s decision. While the Authority considered itself constrained in the use of a s 117 condition relating to aisle-end displays, the factual assessment of the DLC means its decision not to impose a s 117 condition was within its discretion.67
60 Section 58.
61 Sections 43–49.
62 Section 116.
63 Section 237.
64 Section 239.
65 Section 248.
66 J & C Vaudrey Ltd v Canterbury Medical Officer of Health, above n 18, at [44].
67 Medical Officer of Health v G & B Hasler Ltd, above n 9, at [58].
Conclusion
[78] My analysis and determination of these three issues is sufficient to dispose of the appeal. The appellant seeks declarations in respect of each of the eight questions of law he has formulated. Mr Thain correctly observed the appeal is not a declaratory judgment proceeding and the Court cannot be expected to give advisory opinions. As well, the Authority made factual findings which are not challenged.
[79] I will proceed to answer the questions it is appropriate to answer in light of the nature of the appeal (being on a point of law) and in light of the conclusions I have reached.
Answers to questions of law
Question A: In describing a single alcohol area under s 113, is the delineation of the perimeter of a “blank area” on a plan of the premises sufficient having regard to the provisions of s 113(2)(a) and the nature of the decision required by s 113 as set out in J & C Vaudrey Ltd Ors v Canterbury Medical Officer of Health [2016] NZCA 539 at
[33] and [45]?
[80] Yes. The obligation to describe an alcohol area, which is imposed by s 113(2), is satisfied by delineating the perimeter of the proposed area on a plan of the premises. It is not necessary that the plan show the proposed layout and arrangement of displays of alcohol within the alcohol area.
Question B: Is the configuration and arrangement of premises important solely for the purposes of the restriction in s 113(5) or is it also important for the purposes of the third step in defining a single alcohol area, set out in J & C Vaudrey Ltd Ors v Canterbury Medical Officer of Health [2016] NZCA 539 at [33] and [45]; namely to consider whether the description limits, so far as reasonably practicable, the exposure of shoppers to displays and promotions of alcohol and advertisements for alcohol?
[81] Yes. The configuration and arrangement of premises is important also for the purpose of assessing whether the delineated alcohol area limits, so far as reasonably practicable, the exposure of shoppers to displays and promotions of alcohol and advertisements for alcohol.
Question C: Does the description of the alcohol area required by s 113 include the proposed configuration and arrangement of the alcohol area itself and not merely its perimeter such that the description does not permit the applicant to re-configure or re-arrange the alcohol area as it pleases without approval of the District Licensing Committee or Authority?
[82] To the extent the s 113(2) concepts of “configuration and arrangement” apply to an alcohol area, the description of the alcohol area is not required to include the configuration and arrangement within the area itself. If the description required by s 113(2) does include such detail, the licensee remains free to rearrange the area without the approval of the licensing body. The licensing body, of course, retains the discretion conferred on it to impose conditions for the purpose of limiting, so far as is reasonably practicable, the exposure of shoppers to displays and promotions of alcohol and advertisements for alcohol.
Question D: Would (and, if so, to what extent) the imposition of conditions restricting reconfiguration or re-arrangement of the premises, including the single alcohol area, have the effect of altering the described single alcohol area itself as that term was used by the Court of Appeal in J & C Vaudrey Limited & Ors v Canterbury Medical Officer of Health [2016] NZCA 539?
[83] This question does not arise from the decision under appeal and does not therefore require to be answered.
Question E: Can s 117 be used to impose a condition prohibiting aisle-end displays in the single alcohol area?
[84] Yes. In the circumstances which I have set out in [71] conditions can be imposed prohibiting aisle-end displays in the alcohol area.
Question F: If permitted, would conditions like those referred to in (d) and (e) require additional justification beyond the statutory presumption in s 112 that exposure to displays of alcohol products and their promotion by shoppers in supermarkets and grocery stores creates a risk of harm?
[85] In light of my answer to question E this question does not require to be answered.
Question G: If applicants offer to accept restrictions on the use or configuration of a proposed alcohol area in the course of the application or its hearing relating to a single alcohol area condition, should such restrictions be the subject of an appropriate condition under s 117 when the application is granted?
[86] The question does not arise. In its decision the DLC recorded its requirement for the applicant to remove or alter the “Ice Cold Beer Sign” and asked the Inspector to ensure compliance with the request. The Authority noted Hasler’s agreement to remove the sign and that the DLC had proceeded on that basis rather than imposing a condition. The Authority was correct in its conclusion that a condition relating to signage would not be inconsistent with the Act but it was within the discretion of the DLC to proceed as it did. It was not obliged to make a condition. The Authority’s approach was not in error.
Question H: Is the failure to do so, having earlier decided that a particular offered restriction was appropriate, the exercise of a discretion which cannot be challenged on appeal?
[87] The non-imposition of a condition in this case was not in error. The legal vulnerability of future “failures” to exercise a discretion must be assessed if and when those occasions arise.
Summary
[88] The obligation to “describe” an alcohol area is satisfied by delineating the perimeter of the proposed area on a plan of the premises. The plan need not show details of the way in which alcohol is to be arranged and displayed within the alcohol area. The licensing body must know the configuration and arrangement of the premises in order to determine whether the alcohol area contains any part of a proscribed area of the premises. The proposed layout of displays (if any) within the alcohol area has no bearing on the decision to position the area.
[89] A single-area condition, once imposed under s 112(2) does not, of itself, constrain a licensee from making changes to the way in which alcohol is displayed within the alcohol area providing, always, that exposure of shoppers to displays of alcohol is limited so far as is reasonably practicable.
[90] Conditions may be imposed on a licence pursuant to s 117 for the purpose of restricting aisle-end displays in the alcohol area but the licensing body should be satisfied in each case that the condition is reasonable in the circumstances of the particular application. It would be impermissible to use the discretion to impose conditions as a de facto legislative measure.
Result
[91] The appeal is dismissed.
Karen Clark J
Solicitors:
Wilson Harle, Auckland for Appellant DLA Piper, Auckland for Respondent Berry Simons, Auckland for Intervener
Attachment 1
Attachment 2
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