Nelson v The Playhouse Limited and Murphy [2002] NZLLA 663 (26 November 2002)

Last Updated: 31 January 2012

Decision No. PH 663/2002 –
PH 664/2002

IN THE MATTER of the Sale of Liquor Act 1989

AND

IN THE MATTER of an application pursuant to s.132 of the Act for suspension of on-licence number 007/ON/83/2000 issued to THE PLAYHOUSE LIMITED in respect of premises situated at Ground Level, Force Entertainment Centre, 291-297 Queen Street, Auckland, known as “The Playhouse”

AND

IN THE MATTER of an application pursuant to s.135 of the Act for suspension of General Manager’s Certificate number GM 007/151/2002 issued to DAVID WILLIAM MURPHY

BETWEEN NIGEL STUART ROBERT
NELSON
(Police Officer of Auckland)

Applicant

AND THE PLAYHOUSE LIMITED

First Respondent

AND DAVID WILLIAM MURPHY

Second Respondent

BEFORE THE LIQUOR LICENSING AUTHORITY

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

HEARING at AUCKLAND on 21 November 2002

APPEARANCES

Senior Sergeant M J Lopdell – New Zealand Police – applicant
Mr G S Whittle – Auckland District Licensing Agency Inspector – in support
Mr J H Wiles – for the first respondent

RESERVED DECISION OF THE AUTHORITY

Introduction

[1] Before the Authority are two applications for suspension. The first application is to suspend an on-licence in respect of an inner city bar situated at 297 Queen Street, Auckland known as “The Playhouse”. The application is brought by Constable Nigel Stuart Robert Nelson. The licence is held by The Playhouse Limited.

[2] The grounds for the application to suspend the on-licence are:

(a) That the licensed premises have been conducted in breach of ss.165, and 171 of the Act. (Unauthorised sale or supply, and allowing persons on licensed premises outside licensing hours).

(b) That the licensed premises have been conducted in breach of the condition of the licence prohibiting the sale and supply of liquor before 1.00 pm on Anzac Day.

[3] The second application is also brought by Constable Nelson. It is to suspend a manager’s certificate issued to David William Murphy. At the time of the alleged incident on Anzac Day 2002, Mr Murphy was the manager on duty at "The Playhouse".

[4] The ground for the application to suspend the manager’s certificate is:

(a) That the manager has failed to conduct the licensed premises in a proper manner.

[5] Each application relies on an identical set of facts. In short, it is alleged that the premises known as "The Playhouse" continued to trade after midnight on 25 April 2002. It was then trading on Anzac Day in breach of the Act, as well as in breach of the condition of the licence. In respect of the manager it is alleged that his conduct in participating in the unauthorised trading, was improper.

[6] In response, Mr Wiles argued that the licensee had done all it could to comply with the law. He noted that the manager (who was not present or represented at the hearing), had failed to comply with the instructions given on behalf of the company.

The Facts on Which the Applications are Based

[7] Constable S L Taylor is currently stationed at Auckland Central Police Station as part of the Liquor Licensing Section. On Thursday morning 25 April 2002, Anzac Day, along with Mr Gary Whittle, a District Licensing Agency Inspector, he made a number of visits to licensed premises in Auckland to check on their compliance with the Act.

[8] At approximately 12.15 am, he and Mr Whittle observed that the premises known as "The Playhouse" were open and appeared to be trading as normal. There were about 40-50 people in the main bar area, and a few in the casino. They appeared to be drinking a variety of drinks including beer, wine and RTD’s. No one was eating food, or dining.

[9] Constable Taylor went up to the bar which was being manned at the time by David William Murphy, the duty manager. He ordered and was served a pint of beer. He asked Mr Murphy the time. Mr Murphy looked at the cash register and replied 12.15. He then said it was last drinks. According to the electronic journal transaction record, the beer was served and paid for at 12.15 am. There was some evidence that the machine was recording the times up to five minutes late.

[10] The Constable and the Inspector sat down next to a deserted dance floor area, where the chairs had been stacked on tables, and lights were off. Constable Nelson noted that three other drinks were served between 12.20 and 12.25 am. He also heard Mr Murphy take a telephone call. This call was from Craig Docherty. Mr Docherty was the manager in charge of "The Playhouse" although he was working that night at the "Muddy Farmer". The Constable heard Mr Murphy say that he had made the last call, and that people were beginning to leave.

[11] At about that time no more liquor was served. Tabs were paid at the bar. At about 12.30 am people began leaving of their own accord. The last group left at about 12.45 am. When questioned, Mr Murphy stated that he had been instructed by the general manager Craig Docherty, to make the last call at 12.15 am. He said that he had not asked patrons to leave because they normally did so of their own accord.

[12] In summary, the bar gave every appearance that it was in the process of slowing or closing down. However, it was equally clear that drinks were being served after midnight, and up until 12.25 am. The licence contained the following provision:

“(b) No liquor is to be sold or supplied on Good Friday, Easter Sunday, Christmas Day or before 1.00 pm on ANZAC Day to any person other than persons who are present on the premises for the purpose of dining.”

[13] In addition the law is very clearly stated in s.14(2) of the Act as follows:

It is a condition of every on-licence granted in respect of a hotel or tavern that no liquor is to be sold or supplied on Good Friday, Easter Sunday, Christmas Day, or before 1pm on Anzac Day to any person other than –

(a) Any person who is for the time being living on the premises, whether as a lodger or an employee of the holder, or otherwise; or

(b) Any person who is present on the premises for the purpose of dining.

The Respondents’ Evidence

[14] Mr D W Murphy was not present at the hearing, and was not represented. He has now left his employment with "The Playhouse" and is currently overseas. An affidavit signed by him was admitted by consent. In the affidavit, he stated:

“I had been given clear instructions earlier in the evening of 24 April 2002 by Craig Docherty to close the bar at midnight and to have the premises clear of customers by 12.15 am. Unfortunately I failed to abide by those instructions with the result that alcohol was served at 12.10 am."

[15] The Playhouse Limited had three directors of whom Mr Cadell Buss is one. He is also a shareholder. The group has interests in three other licensed premises in Auckland, Takapuna and Hamilton. Mr Buss has been involved in the hospitality industry for ten years. He said that Mr Docherty was the best general manager of licensed premises he has ever encountered. He said that he had no reason to doubt that Mr Murphy had been given clear instructions to close the bar at midnight, and have the customers leave by 12.15 am. It was his view that Mr Murphy had contravened such express instructions.

[16] Mr Craig Docherty corroborated that opinion. Mr Docherty has held a General Manager’s Certificate for three years. On the night in question he had overall responsibility for two licensed premises being “The Playhouse", and the "Muddy Farmer" in Wyndham Street. He was based at the "Muddy Farmer" that night as the duty manager. He stated that he had given clear and explicit instructions to Mr Murphy to close the bar at midnight. Out of an abundance of caution he told him to have the bar clear by 12.15 am. He said that he rang Mr Murphy on more than one occasion during the night to ensure that all was in order.

[17] He gave evidence that he was very concerned to learn that Mr Murphy had disregarded instructions. One of the explanations given to him by Mr Murphy was that he did not see any harm in making the sales as the premises were being closed, and the customers were in the process of leaving. We appreciate that Mr Murphy gave more than one explanation for what happened. In our experience, it is not uncommon for people to attempt to divert the blame for their behaviour.

Conclusion

[18] Based on the evidence which we heard, there is no doubt that liquor was served after midnight on Anzac Day 25 April 2002. It is equally clear that there were patrons still on the premises after the ‘drink up’ time of 30 minutes set out in s.170 of the Act. Mr Murphy accepted responsibility for the breaches of the Act and the licence. Not only that, but he disregarded instructions from his employer as well. We believe that it is desirable for his manager’s certificate to be suspended.

[19] We took a different view of the respondents’ evidence than that suggested by the Police. The onus is on the Police to satisfy us on the probabilities that one or more of the grounds have been established. It was our view that Mr Docherty’s actions were in accordance with the law. He acted as a responsible general manager. Nevertheless, the evidence was that the licensed premises were conducted in breach of ss.165 and 171 of the Act. The sole responsibility for this state of affairs was on the manager.

[20] To some extent the provisions of s.181 of the Act are relevant. This section states:

The licensee of any licensed premises shall not be responsible for any offence against this Act committed by any manager of those premises except where the licensee is a party to the offence.

[21] Senior Sergeant Lopdell accepted that because of s.181 of the Act, it would not have been possible for the licensee to have been convicted in the District Court for the offences. As he pointed out, in s.132 applications, it is not necessary for the Police to prove that the licensee committed the breaches of the Act or the licence.

[22] However, in enforcement proceedings under the Act there are two tests which the applicant must overcome before an order can be made. Section 132(6) reads:

If the Licensing Authority is satisfied that any of the grounds specified in subsection (3) of this section is established and that it is desirable to make an order under this section, it may, by order, ...

[23] The applicant in this case has failed to satisfy us that it was desirable to make an order for suspension. The lack of culpability of the licensee, together with the time period over which the breaches were committed are the reasons why we consider it unnecessary and inappropriate to make an order against the licensee. The object of the Act refers to a "reasonable" system of control over the sale of liquor. It is our view that a suspension of the on-licence in these circumstances would be counter-productive to the establishment and maintenance of such a system. We have therefore exercised our discretion in the licensee’s favour. Although we are satisfied that the grounds have been established, we do not consider it is desirable to make an order under s.132 of the Act.

[24] For the reasons given General Manager’s Certificate number GM 007/151/2002 issued to David William Murphy is suspended for one month from 2 December 2002.

DATED at WELLINGTON this 26th day of November 2002

Judge E W Unwin Mr J C Crookston
Chairman Member

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