Mackie, re [2002] NZLLA 196 (26 April 2002)

Last Updated: 27 February 2010

Decision No. PH 196/2002

IN THE MATTER of the Sale of Liquor Act 1989

AND

IN THE MATTER of an application by JOHN RENNER MACKIE for an on-licence pursuant to s.7 of the Act in respect of premises situated at 1339 Cameron Road, Tauranga, known as "Renners Café & Bar"

BEFORE THE LIQUOR LICENSING AUTHORITY

Chairman: District Court Judge E W Unwin
Member: Mr J C Crooktson

HEARING at TAURANGA on 12 April 2002

APPEARANCES

Mr N Elsmore – for the applicant
Mr R F Burgess – Tauranga District Licensing Agency Inspector – to assist
Mrs R A Jack – objector – in opposition
Mr P I Hill – objector – in opposition
Mr M T Taylor - objector – in opposition

RESERVED DECISION OF THE AUTHORITY

Introduction

[1] This is an application for on-licence pursuant to s.7 of the Act. The premises are situated at 1339 Cameron Road, Tauranga. The proposed tavern is part of a relatively new shopping complex, not far from a residential street. Since March 2000, the applicant has been the holder of a restaurant style licence in respect of the premises.

[2] In January 2001, the District Licensing Agency Inspector established that the premises were being operated as a tavern. Not only did the furnishings consist of high stools and bar leaners, Mr Mackie had installed the full complement of poker machines. At that time, Mr Mackie acknowledged that the premises were being run as a tavern. It was also discovered that the garden bar was approximately double the size of what had been originally indicated. The garden bar had been built after the issue of the licence. Because of the size of the garden bar, two car parking spaces had been lost.

[3] Once the Inspector was satisfied that the premises were being conducted illegally, he asked Mr Mackie to take appropriate action. Nothing happened for some time although a number of ideas were floated. It was only after a resource management abatement notice was issued that Mr Mackie made the current application. The application was received on 9 November 2001.

[4] Mr Mackie had earlier applied to the District Council for a compliance certificate. He discovered that no such certificate could be issued, as he was unable to provide sufficient car parks for a tavern operation as required by the District Plan. Accordingly, he decided not to include the garden bar in the new licensed premises area. The garden bar was eventually dismantled. A compliance certificate was then received and filed with the application.

[5] Although the reporting agencies were comfortable with the application, the public notice drew two objections from neighbouring businesses, and one objection from a neighbouring resident. The objectors' main concerns were problems associated with car parking. However, there were also serious issues with Mr Mackie's suitability, and the hours of opening. Accordingly the matter was set down for a public hearing.

The Historical Background

[6] The background to this application is important, as it has played a significant role in our decision making.

[7] In early December 1999, Mr J R Mackie made his initial application for an on-licence in respect of these premises. At that time, the principal business was stated to be the sale of liquor. The trading hours sought were Monday to Sunday 9.00 am to 1.00 am the following day. In effect the application was for a tavern licence.

[8] The original application had an attached plan, which showed the intended licensed area of the building, plus a small outside garden bar area. When the original application was advertised, seven individual objections were received, together with a petition signed by 28 local residents.

[9] Mr Mackie wrote to the objectors as follows:

"We are in receipt of your objection to our licence application for a Café. Unfortunately someone has been misleading the local people as to exactly what will be the nature of the business. You are probably aware that there are only certain grounds you can object to. We intend to hold a meeting at the 'site' on Tuesday 21st December at 6pm. A member of the Licensing Agency of the Tauranga District Council will be in attendance, to answer any queries or concerns you may have."

[10] It will be noted that Mr Mackie referred to the business as a café. Twelve objectors attended the meeting. At the meeting Mr Mackie shifted the emphasis from a bar to a café. He told the objectors that he would be putting in 3 or 4 gaming machines which he owned. Although Mr Mackie denied that he had quantified the number of machines, we have no hesitation in accepting the word of the objectors who gave evidence on this subject. We also accept their evidence that Mr Mackie told the meeting that the emphasis would be on the café.

[11] Mr Mackie told the meeting that he was going to set up a small garden bar. As a consequence of what was said at the meeting, Mr Mackie amended the proposed trading hours to a 10.30 pm closing from Sundays to Wednesdays. The proposed reduction in hours had an impact on a number of the objectors including Mr M T Taylor, the organiser of the petition. Three of the objectors and twelve of the petitioners withdrew their opposition to the application. Mr Taylor was one of those to withdraw his objection. Nevertheless certain objectors wished to proceed to a hearing. Accordingly the file was referred to the Authority in Wellington.

[12] Mr Mackie was in communication with the Authority's staff at that time. It is not known with whom he spoke. According to him, he received certain advice. It will be noted that by that time the Sale of Liquor Amendment Act 1999 had been passed. The amendment to Section 7 was due to come into force on 1 April 2000. The amendment affected the classification of on-licences and allowed for casual drinking in restaurants.

[13] On 27 January 2000, Mr Mackie sent two faxes to the Authority. The first fax explained the steps he had taken to have the objections withdrawn. He explained that the objectors who had withdrawn were the ones who lived closest to the premises. Some of the remaining ones, he said, lived over a half a kilometre away.

[14] The second fax was much more significant. In that fax Mr Mackie stated:

"This is to confirm that Renner's Bar & Café intends to operate primarily as a Café with liquid refreshments available. A new kitchen is being built within the premises and our main objective is to serve Diners."

[15] The letter's clear intention was to change the format of the business from a tavern to a restaurant.

[16] The following day an Investigating Officer employed by the Authority prepared a report for the members of the Authority. The report stated that Mr Mackie was seeking 'a brasserie style on-licence.' The Investigating Officer confirmed that a number of the objectors had withdrawn their objections. She said that:

"Apparently the remaining objectors are those who live furthermost from the premises. At any event the objections are invalid in that they do not address the criteria."

[17] She recommended a dual purpose on-licence be approved in accordance with a draft which was attached to her memorandum. The proposal included the small outdoor dining area as part of the licensed premises.

[18] On 2 February 2000 the Authority issued a decision. The decision authorised the issue of an on-licence. There was no public hearing. The relevant parts of the decision read:

"The general nature of the business to be undertaken is that of a restaurant.

The applicant intends to sell liquor not only to any person who is present for the purpose of dining but also to any other person who is present on the premises. Nevertheless the applicant portrays the main part of the business as being the promotion of food of a range and style detailed in a sample menu submitted. On that basis we accept that the premises will remain within the definition of a restaurant as defined in s.2 of the Act and that the sale of liquor will not be the principal business.

The remaining objections and the issues raised in the petition do not relate to matters to which we are required to have regard specified in s.13 (1) of the Act as required by s. 10 (3). We will deal with the matter on the papers.

We grant the applicant an on-licence authorising the sale and supply of liquor for consumption on the premises to –

(a) any person who is present on the premises for the purpose of dining; or

(b) any other person who is present on the premises.

We point out that should the conduct of the business become other than that as portrayed in the application, or should the manner of operation bring it to the attention of the enforcement authorities, it will be open to them to lodge an application pursuant to s. 132 of the Act for variation, cancellation or suspension of the licence."

[19] What happened after that is not entirely clear. Mr Mackie said that he experimented with the restaurant to see whether it would be a viable proposition. He said there were some days when the food takings were greater than the bar takings. He produced no records to confirm this. On the other hand Mr Jack and Mr Hill were adamant that the premises had never operated as a restaurant. Mr Mackie was clearly uncomfortable in the witness box when it was put to him that there was no difference between the operation now, and the operation in March 2000.

[20] The menu, which was produced with the application, had not apparently changed. It consists of six items in total. Three of the items are defined as snacks. These are chips, wedges and toasted sandwiches. The other three items are described as light meals. These are chicken burgers, fish and chips, and a porterhouse steak for $7.95. If those items were regularly supplied on sale to the public for consumption on the premises, then the premises might fall within the definition of a restaurant in s. 2 of the Act. Of course the issue in this case is whether the premises were being used principally for the supply of liquor.

[21] The combination of the furnishings, and the poker machines, and the menu all point to the operation of a tavern. Giving Mr Mackie the benefit of a substantial doubt, he may have started his business with the intention of trying out a restaurant operation. He said that he was 'heading into the unknown'. It is our view that he made no significant effort to run his business in the way depicted in the licence. Certainly no evidence was produced to support such a contention.

[22] What is quite clear is that at some stage after the issue of the on-licence, Mr Mackie has consciously allowed the premises to be run as a tavern. That state of affairs continued for at least fifteen months and probably longer. Despite the clear wording in the Authority's decision to grant the licence, the conditions of the licence have been continuously ignored.

[23] The impact of the decision to operate as a tavern has been quite distressing for the objectors. The major impact has related to the issue of car parking. As stated at the hearing, this is not a matter within the Authority's jurisdiction. Both Mr Jack and Mr Hill run businesses in this suburban commercial shopping centre. They rely on the goodwill and loyalty of their regular customers. Their customers rely on the ability to park conveniently outside the shop or business for short periods of time.

[24] Mr Mackie had installed eighteen poker machines. Until recently, there were seven available car parking spaces. In consequence patrons of the tavern have used the objectors' designated car parks indiscriminately. From October 2000 to the date of the hearing, Mr Hill has placed no less than 209 'No Parking' notices on different vehicles which have been parked in his car parks while the owner visited the 'casino bar'. There were other consequences to the objectors flowing from the decision to operate as a tavern. These will be listed shortly. We conclude this section of the decision by stating that in the light of the background to this case, we can understand the depth of feeling and frustration displayed by the objectors.

The Application

[25] Mr Mackie has been involved in the hospitality industry since 1972. His first hotel was in Carterton where he spent three years. Thereafter he carried out relieving work. From 1990 to 1998 he was a joint proprietor of the Albert Motor Lodge in Palmerston North.

[26] Mr Mackie produced a letter from the District Council dated 13 December 2001. That letter confirmed that following the removal of the garden bar, there were now nine car parks available for the tavern. The letter concluded that Mr Mackie had met the Council's requirements, and that the certificate of compliance could now be issued. The certificate allowed for consumption of liquor during the hours currently in use.

[27] Mr Mackie stated that the majority of his patrons were middle aged. Because of that factor, he disputed any suggestions of drunkenness and disorderly behaviour. He confirmed that the erection and dismantling of the garden bar had not required a permit. Mr Jack had suggested that to enable a tavern to coexist with other shops, the opening hours should coincide with the closing hours of the other shops. We would have given this offer serious consideration in the light of s. 14 (7) of the Act. However, Mr Mackie regarded the suggestion as neither serious nor sensible.

[28] The hours sought by the applicant are those currently in use. These are:

Sunday to Wednesday 9.00 am to 10.30 pm
Thursday to Saturday 9.00 am to 1.00 am the following day

[29] Mr Mackie refuted any complaint about his suitability. He submitted that the objectors were motivated by self interest and patch protection. Mr J D N Kehely the manager of the landlord company supported his view. Mr Kehely considered that the complaints raised by Messrs Jack and Hill regarding parking, were baseless. It is perhaps not unreasonable to ask what Mr Hill was doing placing over 200 "no parking" notices on vehicles which were parked in his car parking spaces if his concerns were baseless.

[30] Mr Mackie noted that there had never been any Police or Agency concern about the running of the business since the licence was first issued. Furthermore, there was no opposition to the application from the Police, or the Medical Officer of Health, or the District Licensing Agency Inspector.

The Objections

[31] With respect to the views of the applicant and his landlord, we do not accept that the objectors were motivated by 'patch protection'. Mr M T Taylor gave evidence that he felt deceived by the applicant. At the first public meeting, he had been told that there would be three gaming machines. He then withdrew his objection. He then discovered that eighteen machines had been installed. When he withdrew his original objection, he thought that a café was being proposed. He then found that people were drinking in the car park.

[32] Mr Jack pointed out that Mr Mackie and the landlord had carried out the alterations to the car parking during the night, the night before the District Council had required compliance with its plan. He produced photographs to show how impractical the new arrangements were. He submitted that nine car-parking spaces were insufficient to satisfy the needs of the users of 18 gaming machines. In previous cases before the Authority it has been confirmed that some gamblers become so preoccupied with playing the machines that they lose all perception of time.

[33] He submitted that Mr Mackie had been deceitful from the outset. He said that he did not oppose the original application because he believed that the proposed business was going to be a café with a small garden bar, and three machines. It was his evidence that the business had operated as a tavern right from the start.

[34] Both he and Mr Hill had been subjected to verbal and physical abuse as a result of their campaign to force Mr Mackie to comply with the law. Mr Jack asked how it was possible for anyone to operate outside his on-licence for over twenty four months? If Mr Mackie could set up a tavern knowing it was in breach of his licence, then what was the point in having conditions on a licence? He proposed limiting the hours of opening. As already stated in this decision, this compromise was rejected by Mr Mackie.

[35] Mr Hill confirmed that the premises had operated illegally from day one. He also felt deceived by Mr Mackie. The deceptions were: (a) the café being the principal business; (b) the number of gaming machines; and (c) the small garden bar which subsequently took up two car parking spaces. Both he and Mr Jack referred to a number of disorderly incidents arising from the supply of liquor from the premises. We have not detailed these, as they were unable to be substantiated in the light of the denials by Mr Mackie. There was insufficient proof that the incidents had resulted from the mismanagement of the licence, bearing in mind that the licence itself was being mismanaged at the time.

Conclusion

[36] In considering an application for an on-licence the Authority is directed by s.13(1) to have regard to the following matters:

(a) The suitability of the applicant;

(b) The days on which and the hours during which the applicant proposes to sell liquor:

(c) The areas of the premises or conveyance, if any, that the applicant proposes should be designated as restricted areas or supervised areas:

(d) The steps proposed to be taken by the applicant to ensure that the requirements of this Act in relation to the sale of liquor to prohibited persons are observed:

(e) The applicant's proposals relating to the sale and supply of non-alcoholic refreshments and food:

(f) Whether the applicant is engaged, or proposes to engage, in –

(i) The sale or supply of any other goods besides liquor and food; or

(ii) The provision of any service other than those directly related to the sale and supply of liquor and food,-

and, if so, the nature of those goods or services:

(g) Any matters dealt with in any report made under section 11 of this Act.

[37] The Act requires us to be satisfied that the applicant is suitable and will uphold the law. It is quite clear from the evidence that we must have serious reservations about Mr Mackie's suitability and conduct. Mr Hill submitted that Mr Mackie has treated his neighbours with disdain, and the Tauranga District Licensing Agency, the Tauranga District Council, and the Liquor Licensing Authority with complete contempt.

[38] It is certainly disturbing to discover how the first application was changed to ameliorate the impact of the objections. Having achieved his licence, it was even more disturbing to discover that the licence conditions were then ignored.

[39] No inspection of the premises was made after they had opened. Mr Burgess did not seem to think that such an inspection was warranted. With respect, and with the benefit if hindsight, we find it difficult to understand why no application was brought to have the licence cancelled. Mr Burgess took the view that the objectors were conducting a 'vendetta' against Mr Mackie, although he later attempted to qualify the word. Again with the benefit of hindsight, it may have been better to ascertain why such a deep and abiding concern had been aroused.

[40] If the law and the conditions of the licence can be broken with such ease, then the scheme of the Act loses its integrity. How can one "establish a reasonable system of control over the sale and supply of liquor to the public with the aim of contributing to the reduction of liquor abuse", if the holders of licences appear to be acting above the law.

[41] To refuse the application on the grounds of unsuitability could well be warranted in this case. However, we have decided that there is an ‘abuse of process’ principle at stake. We are not unmindful that a decision based on unsuitability would have other implications and consequences. Mr Mackie currently holds a restaurant style on-licence. In our view he should have the opportunity to make that work. To do so we would expect the removal of the majority of the machines, and a change to the furnishings and the menu. On the other hand if there is no short term bona fide compliance with his current licence, we would expect the filing of an application to cancel it.

[42] It has often been said that given both a suitable applicant and a Resource Management certificate, a liquor licence almost inevitably is granted under present legislative provisions.

[43] This case represents a true exception to the convention.
[44] A tribunal, such as the Authority, has a duty and a right to ensure that its processes are not abused.

[45] In this case the abuse of the process started at the public meeting when the objectors were advised about the emphasis on a café and the number of gaming machines. The abuse was aggravated when the application was changed to a restaurant style licence to ensure the issue of a licence without a public hearing. Matters were made worse when the garden bar was built to be twice the size of the original plan, at the same time taking up two car parking spaces.

[46] The most significant abuse occurred when the premises were operated as a tavern for up to two years in direct contravention of the conditions of the licence. In our view, Mr Mackie embarked on a systematic course of conduct designed at circumventing the Act, to the ultimate detriment of the objectors and the general public.

[47] The greatest abuse of process would occur if Mr Mackie was rewarded for his deceptive practices by being granted a tavern style on-licence. Such a step would be the final indignity to the long-suffering objectors, and would in our view discredit the Act and its principles.

[48] For these reasons, the application is refused.

DATED at WELLINGTON this 26th day of April 2002

Judge E W Unwin Mr J C Crookston
Chairman Member

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