Verner v Kamer Holdings Limted [2003] NZLLA 299 (1 May 2003)

New Zealand Liquor Licensing Authority

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Verner v Kamer Holdings Limted [2003] NZLLA 299 (1 May 2003)

Last Updated: 14 March 2010

Decision No. PH 299/2003 –
PH 300/2003

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 off-licence number 049/OFF/39/2000, issued to KAMER HOLDINGS LIMITED in respect of premises situated on the Ground Floor, 139 Johnsonville Road, Johnsonville, Wellington, and known as “Super Liquor Johnsonville”

AND

IN THE MATTER of an application pursuant to s.135 of the Act for suspension of General Manager’s Certificate number 049/GM/235/2000 issued to STUART JAMES McFARLANE HANAFIN

BETWEEN GRANT DAVID VERNER

(Police Officer of Wellington)

Applicant

AND KAMER HOLDINGS LIMITED

First Respondent

AND STUART JAMES McFARLANE HANAFIN

Second Respondent

BEFORE THE LIQUOR LICENSING AUTHORITY

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

HEARING at WELLINGTON on 17 April 2003

APPEARANCES

Sergeant G D Verner – NZ Police - applicant
Mr M J Kemp – Wellington District Licensing Inspector – in support of applicant
Mr D A Richards - agent for first and second respondent

RESERVED DECISION OF THE AUTHORITY

Introduction

[1] Before the Authority are two applications for suspension. The first is an application to suspend an off-licence issued to Kamer Holdings Limited, in respect of premises situated on the Ground Floor of 139 Johnsonville Road, Johnsonville, near Wellington, and known as "Super Liquor Johnsonville".

[2] The grounds for the application in respect of the off-licence are that the licensed premises have been conducted:

(a) In breach of ss.155(1) and 115(2) of the Act. Those sections respectively prohibit the sale or supply of liquor to minors, and require the name of the duty manager to be prominently displayed.

(b) In breach of the condition of the off-licence requiring the licensee to ensure that the provisions of the Act, relating to the sale and supply of liquor to prohibited persons, are observed.

[3] The second application is for the suspension of a General Manager’s Certificate issued to Stuart James McFarlane Hanafin. The ground for this application is that the manager failed to conduct the licensed premises in a proper manner.

[4] Both applications arise from the same set of facts. It is alleged that a young male volunteer aged 17 years and 3 months, was able to purchase a pack of 15 "Tui" bottles without being asked for his identification. The sale was made by Mr S J M Hanafin, who was the duty manager at the time.

[5] Neither of the respondents contested the evidence of the sale, or the fact that the manager’s name was incorrectly displayed. Mr Hanafin is currently in Australia. It was hoped to supply an e-mail explanation from him but he could not be contacted. Nevertheless, Mr Richards submitted that the circumstances were such that any suspension would be undesirable. It was argued that Mr Hanafin had thought that the young man was in his "twenties", and that his error of judgement should not be visited upon the licensee.

[6] To some extent this case turns on the evidence of the teenage volunteer. We had the opportunity to observe him on two occasions when he gave evidence. We had some reservations about the level of his maturity, and the way he approached the "test purchase". We gained the impression (rightly or wrongly), that with the enthusiasm of youth, he saw the "operation" as more of a test of his own skills, rather than as an audit of the store’s systems. In those circumstances, the concern was whether there may have been an element of unfairness in the controlled purchase operation. Accordingly, it was our view that the main issue to be determined was whether it was desirable that suspension orders be made. As will appear, in respect of the licensee, we have not been so persuaded.

The Factual Background

[7] During the Authority’s hearings in Wellington for the week of 14 April 2003, we dealt with eleven applications for suspension of off-licences and/or manager’s certificates. Each application followed the controlled purchase operation conducted in November 2002. In a number of the decisions to date, we have set out the background which led up to the operation, and in particular the efforts made by the Wellington District Licensing Agency to educate all licensees about the importance of preventing the supply of liquor to minors. The education programme has been expanding incrementally since the lowering of the drinking age, and has received more prominence during the last two years.

[8] We do not propose to repeat our observations in this case. In summary, the Wellington District Licensing Agency has proactively sought to encourage licence holders and managers to take their respective responsibilities seriously. Mr M J Kemp is a warranted inspector under the Act, and is employed by the Agency. He submitted that licensees and managers in Wellington should have been well aware of the probability of a monitoring exercise aimed at testing compliance by licensed premises, with the law relating to the supply of liquor to minors.

[9] On 29 November 2002, the Wellington District Licensing Agency in conjunction with Regional Public Health, and the New Zealand Police, conducted their first controlled purchase operation in the city. Before carrying out the operation, the Agency conducted an evaluation of controlled purchase operations which had been carried out elsewhere in the country. The result was a framework document which set out a number of checks and balances, aimed at ensuring fairness in the operation. During the controlled purchase, a total of 21 premises were visited. Of the 21 premises that were tested by the volunteers, eight sold liquor without asking for identification. The premises known as "Super Liquor Johnsonville" was one of the culprits.

[10] The volunteer in this case was a young man named ‘John’. He was born in Jamaica on 31 August 1985, and was therefore seventeen years and three months at the time of the operation. He is six feet tall, and at the time of the purchase had facial hair in the form of a light moustache and a light beard. He struck us as a very confident young man. He entered "Super Liquor Johnsonville" at about 8.30 pm. He uplifted a pack of 15 bottles of "Tui" which were on special at $20 per pack. He spoke with Mr Hanafin and said “Hi man”. He had no problem making the purchase, and handed over the $20 note he had been given. The incident took about five minutes. There were three other shoppers in the premises.

[11] Mr Hanafin later confirmed with Mr Kemp, that he was the duty manager, although some one else’s name was displayed on the sign above the doorway. He said he had not got round to changing the name. He remembered selling the liquor to "John". He said he was concerned about the other young men, who were by the bourbon counter, as he suspected that they might try and shoplift one of the bottles. He thought John was 20 or 21, and therefore did not request identification, although his rule of thumb was to test anyone who looked under 25. Regrettably, he has since left his employment and is currently in Australia, so we were unable to hear from him. According to his employer, "John’s" apparent knowledge of liquor, and his level of self-confidence were factors in Mr Hanafin’s decision to make the sale.

[12] On the other hand, we did hear from Mr B J Clarence, a director of the licence holding company, and the manager of the premises. He has been the manager for the past five years. He confirmed that all staff had instructions to ask for identification for anyone they believed was under 25 years of age. He had great faith in Mr Hanafin who had a reputation of being a "Pit Bull Terrier” when it came to minors trying to purchase liquor. The group is part of a franchised chain under the control of Lion Breweries Limited. They have a policy of requiring staff to report any incident, involving any attempt by a minor to purchase liquor, to the duty manager. They find it a good defence strategy. Staff are also required to patrol the perimeter of the premises to make sure minors are not hanging about. Care is taken when sales are made to other young people in case they are buying for minors.

[13] Mr Clarence confirmed that since the incident, all staff are required to sign an addendum to their employment contract which outlines the offences under the Act they can be charged for, and for which they can now face instant dismissal. All employees are now asked to sign a declaration at the start of each week, confirming that they will abide by the Act. Furthermore, the company is trialling the use of digital cameras to record the identification presented by customers. They have invested in a new set of signs, and a new video based training programme. As a result of the incident, Mr Hanafin received a formal written warning from his employer.

Decision

[14] As mentioned earlier, we had reservations about "John’s" apparent confidence, and his physical maturity. According to Mr Kemp, "John" was keen to keep trying other premises during the night to see if he could score another "hit". In cases such as this, we have found it a useful indicator to consider the other situations where the volunteer has been refused service. If he or she has been regularly questioned at other premises, then they are more likely to look their age. In this case, John was refused service twice, at two "Woolworths" supermarkets. He was able to purchase liquor at "Super Liquor Johnsonville", and one other off-licence. In our view, to be refused service at the two ‘Woolworths’ stores, in not a significant indication that he was clearly underage. Since the original Karara decision in Christchurch, we are aware of the very strict guidelines being operated by the supermarket chains. Any sale of liquor to any customer regardless of age now receives special attention. Generally speaking, supermarkets have become much stricter in their monitoring of liquor sales.

[15] In this case, "John" initiated the conversation with the manager. He used up the whole of the $20 which he had been given. In a separate case before us, he entered into a discussion about the merits of overseas beer. He gave us the impression that he was keen to see if he could make a "hit". He had an air of confidence unlike other teenagers who have appeared before us.

[16] On the other hand, Mr Hanafin was the manager on duty. On this occasion, he did not obey his own high standards, which were to check any person appearing to be under 25. As a manager, he has benefited from specific training in upholding the law, and the conditions of the licence. He is the person charged with leading staff by example. He carries the responsibility pursuant to s.115 of the Act, of ensuring compliance with the conditions of the licence, and the provisions of the Act. He failed the challenge, although his level of culpability may not have been as high as others. His absence from the hearing has disadvantaged him because we had no way of testing his explanations, and he was unable to show that he genuinely believed that "John" was 18 or over.

[17] In summary, it is clear that the grounds specified in both applications have been established. The issue in this case is whether orders should be made. The answer to that question must reflect the seriousness of supplying liquor to minors. Although Mr Richards submitted that the company could not be culpable for the actions of its employee, that is not the test. The only issue under s.132(3)(a) of the Act is whether the premises have been conducted in breach of the provisions of the Act.

[18] We accept that in this case, the Police have not been able to establish the alternate ground that the premises have been conducted in breach of the condition of the licence. That condition places the onus of not supplying minors or other "prohibited" persons, on the licensee, not the manager. There is no proof that the licensee, through its officers, has been neglectful in its operation of the licence. There was a failure to display the name of the duty manager, but that was a technical offence. Although the responsibility for displaying the name falls on the licensee, the failure to do so reflects more on the manager, whose duty it was to change the name.

[19] Our views about the sale of liquor to minors were first expressed in Onehunga Wines & Spirits Co. Limited LLA PH 311-312/2001. As was said in that case:

"Since the age limit was reduced to eighteen, there have been regular concerns expressed throughout the country about the ability of young people to obtain alcohol ... When Parliament reduced the age limit to eighteen it doubled the penalties. It was sending a message to the public that people who breached this aspect of the law must expect rigorous enforcement and severe consequences."

[20] In exercising our discretion under s.132(6) of the Act, we do not believe that it is desirable to make a suspension order in respect of the off-licence. We make this decision because of our reservations about the young volunteer’s maturity, and the way he went about his task. We therefore believe that any sanction against the licensee would be undesirable. This should not be seen as a reflection on the volunteer. It was quite understandable for him to be keen to achieve a result. There will be a limited number of cases where there is a conflict between the objective process of auditing the systems of an off-licence, and the creation of a situation where an illegal sale is made, which would not have happened but for the particular circumstances. In our view this was such a case.

[21] In exercising our discretion under s.135(6) of the Act however, we believe that it is desirable to make a suspension order against the manager. It was his choice to go to Australia after receiving notice of the application. His evidence may have been crucial in deciding whether he was genuinely misled by "John’s" appearance and confidence, or whether he made a simple error of judgement. At any event, he had only to ask whether "John" had identification, or was 18, and he would have received a truthful answer. Taking into account the provisions of s.115 of the Act, and our residual reservations about the particular circumstances of the operation, we have decided to impose a slightly lesser suspension period than we have applied to other managers.

[22] For the reasons we have given, the application to suspend off-licence 049/OFF/39/2000 issued to Kamer Holdings Limited is refused.

[23] General Manager’s Certificate number 049/GM/235/2000 issued to Stuart James McFarlane Hanafin will be suspended for three weeks from 6.00 am on Monday 12 May 2003.

DATED at WELLINGTON this 1st day of May 2003

Judge E W Unwin Mr J C Crookston
Chairman Member

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