Verner v Broadway Standalone Limited and Chhun [2003] NZLLA 303 (2 May 2003)

New Zealand Liquor Licensing Authority

[Index] [Search] [Download] [Help]

---

Verner v Broadway Standalone Limited and Chhun [2003] NZLLA 303 (2 May 2003)

Last Updated: 14 March 2010

Decision No. PH 303/2003 –
PH 304/2003

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/8/2001, issued to BROADWAY STANDALONE LIMITED in respect of premises situated at 502-504 Broadway, Strathmore, Wellington, and known as “Star Mart Broadway”

AND

IN THE MATTER of an application pursuant to s.135 of the Act for suspension of General Manager’s Certificate number 049/GM/412/2001 issued to KIMSEK CHHUN

BETWEEN GRANT DAVID VERNER

(Police Officer of Wellington)

Applicant

AND BROADWAY STANDALONE LIMITED

First Respondent

AND KIMSEK CHHUN

Second Respondent

BEFORE THE LIQUOR LICENSING AUTHORITY

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

HEARING at WELLINGTON on 16 April 2003

APPEARANCES

Mr D A Richards - agent for first and second respondents
Sergeant G D Verner – NZ Police - applicant
Ms J H Burt – Wellington District Licensing Inspector – in support of applicant

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 Broadway Standalone Limited, in respect of a convenience store situated at 502-504 Broadway, Strathmore in Wellington, and known as "Star Mart Broadway".

[2] The grounds for the application in respect of the off-licence are that the licensed premises have been conducted in breach of s.155(1) of the Act. This section prohibits the sale or supply of liquor to minors.

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

[4] Both applications arise out of a controlled purchase operation. It is alleged that a young female volunteer aged 16 years and 7 months, was able to purchase a bottle of sparkling wine from the "Star Mart Broadway" without being asked for her identification. The sale was made by Mr Kimsek Chhun, who was the duty manager at the time.

[5] Neither of the respondents contested the evidence of the sale. Mr Richards submitted that taking into account all the circumstances, including changes made since the incident, any suspension of the off-licence would be undesirable. Mr Richards acknowledged that a suspension of the manager’s certificate was appropriate.

The Factual Background

[6] 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 a 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 Agency’s programme has been expanding incrementally since the lowering of the drinking age in 1999, and has received even more prominence during the last two years.

[7] We do not propose to repeat the background. Suffice to say that it is our view that the Wellington District Licensing Agency has proactively sought to encourage licence holders and managers to take their respective responsibilities seriously. Ms J H Burt is a warranted Inspector under the Act, and is employed by the Agency. She contended that licensees and managers in Wellington would have been well aware that "controlled purchase operations" were soon to take place.

[8] 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 operation, a total of 21 premises were visited. Of the 21 premises that were tested by the volunteers, eight sold liquor without asking for identification. However, we have expressed some concern about the maturity and confidence of one of the volunteers who was able to purchase liquor from two premises.

[9] In these present cases, the volunteer in this case was a young woman named Aimee. Aimee was born on 11 April 1986, and was therefore sixteen years and seven months at the time of the operation. It is unlikely that anyone could make an "informed" decision that she was 18 or over. On Friday 29 November 2002, at about 8.07 pm, she entered "Star Mart Broadway". She uplifted a bottle of "Diva" sparkling wine valued at $13.95. She handed Mr Chhun $20 who asked “Is that all?” He made no other comment and made the sale. When spoken to, Mr Chhun said that he thought Aimee was 22. Later he said he wondered about Aimee’s age, but there was a queue of three other people in the shop, and he had just served her. He acknowledged that he had been told to check for identification if a buyer looked under 25. Aimee confirmed that there were three other shoppers in the premises when she entered.

[10] When he gave evidence, Mr Chhun stated that he had worked at the "Star Mart" for about two years, and held a certificate for that amount of time. He said that Friday night was a busy time, and for some reason he thought that Aimee’s face looked familiar, and that he had served her before, and previously checked her identification. As it happens Aimee had not been in the shop before.

[11] Ms J J Azzarelli is the franchise holder of "Star Mart Broadway". She advised us that the premises are part of a national Star Mart group which is controlled by Star Services Limited, a daughter company of Caltex New Zealand Limited. "Star Mart Broadway" is one of four franchised operations within the Star Mart group. As a franchise holder the premises are governed by strict operational guidelines.

[12] She confirmed that all staff undergo a manager's certificate training course, as well as in-house assistance and support. There is a peer review system operated with security cameras. Regular staff meetings are held. Since the event, a number of new initiatives have been put in place. These include a day book in which all suspect purchases are recorded, a variation to the employment contract, a declaration to be signed by all staff each week accepting responsibility for proper management, and new signage. Mr Chhun had received a written warning, although she had considerable faith in him.

[13] Mr Richards submitted that the licence holder could not be responsible for the unauthorised actions of its employee, and that any suspension would be harsh, as there was no intent to evade the law. On the other hand, it will be noted that the ground under s.132 of the Act does not seek to apportion blame. There is sufficient ground to warrant an order if the premises have been conducted in breach of the Act.

Decision

[14] Mr Richards urged us not to suspend the off-licence. He relied in part on the judgment of Panckhurst J in Karara Holdings Limited and others v The District Licensing Agency Inspector and others AP 14/02 Christchurch High Court 8 July 2002. The judgment is about to be ruled on by the Court of Appeal. Accordingly, any further comment may be inappropriate. We note however, that at paragraph [54] of his judgment, His Honour made these comments:

“By contrast I am in no doubt that the Authority’s power of suspension in Part VI of the Act is intended for a different purpose. As I have already endeavoured to explain it is a power vested in the Authority to enable it to enforce the management responsibility which is in itself a key concept of the licensing regime.”

[15] For our part, we would have thought that the sale and supply to minors was very much part of management responsibility. We accept that His Honour felt that while an order for suspension may be punitive and deterrent in nature, those ends were not the essential purpose for which the power was conferred. We have continued to take the view, bearing in mind conflicting decisions in the High Court, that applications for suspension are one of the ways in which the object of the Act can be achieved. It is our view that a reduction in liquor abuse cannot be achieved if the law relating to the sale of liquor to minors is ignored or treated with disrespect.

[16] There is no question that the grounds have been established. The issue in this case is whether an order should be made. That issue must reflect the seriousness of supplying liquor to minors, when viewed against a background of two factors.

(a) The potential increase of liquor abuse. Although there was no abuse reported in this case, some minors who have purchased liquor unlawfully, have ended up in a hospital.

(b) The 1999 reduction of the legal drinking age from 20 to 18.

[17] This major change of policy was accompanied by a number of other statutory measures. These measures were designed to bolster the detection and enforcement of breaches of the new law. Parliament clearly took the view that the supply of liquor to minors was a very serious liquor abuse issue. It gave the Act the necessary teeth in an attempt to actively discourage those who might be tempted to supply liquor to persons under age. The measures which were enacted included:

(a) Section 2A. The provision of “evidence of age documents”.

(b) Section 132A. The mandatory reporting of certain proven offences (including sales to minors) to the Authority, and a requirement for the Authority to consider whether a public hearing to suspend or cancel the licence is appropriate.

(c) Section 155 (2A). Not only were all penalties doubled for all offences, the penalty for supplying liquor to minors was increased to a maximum of $10,000 (for managers and licensees), and the District Court was given the power to suspend a licence for up to 7 days.

[18] Our views about the impact of these provisions 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."

[19] The Authority was signalling that in the area of sales to minors, there would be cancellations and suspensions. The principle that "a licence will be easy to get and easy to lose" was first coined by the authors of "Sale of Liquor", and subsequently quoted by the Authority as far back as 1990 in Douglas-Oliver Corp Ltd [1990] NZAR 411. It has been cited in a number cases since. The fact that the sale was made by a manager in this case, in our view aggravates the situation.

[20] In exercising our discretion under ss.132(6) and 135(6) of the Act, we believe that it is desirable to make an order. Put in another way, if no sanction was imposed, we would not be exercising our discretion in a way envisaged by s.4(2) of the Act:

The Licensing Authority, every District Licensing Agency, and any Court hearing any appeal against any decision of the Licensing Authority, shall exercise its jurisdiction, powers, and discretions under this Act in the manner that is most likely to promote the object of this Act.

[21] At issue then is the length of any suspension. In the Karara decision, LLA PH 216 – 229/2002, the Authority was confronted by seven applications for suspension following a controlled purchase operation. Four of the licensed premises were supermarkets, and three were taverns with separate bottle stores. For six of the premises, this was the first time they had been apprehended for making illegal sales. Those off-licences were suspended for five days.

[22] Taking into account the first respondent’s excellent record in the industry to date, and the actions taken since the incident, we propose to suspend the off-licence for three days. We considered the question of an adjournment of the application but decided against it. We believe that the lesson should have been learned by now. We were not overly satisfied with Mr Chhun’s prior training by his employer. In all the circumstances we believe that an order should be made, particularly when it is noted that 13 of the 21 premises which were visited, had sufficient systems in place to refuse to make the sales.

[23] As far as the second respondent is concerned, he is in a different situation. He has had the advantage of independent training. He is the person who carries the responsibility for ensuring that the Act and the conditions of the licence are obeyed. He had no real excuse for what happened. Accordingly, we make the following orders.

[24] Off-licence number 049/OFF/8/2001 issued to Broadway Standalone Limited will be suspended for three days from 6.00 am on Monday 19 May 2003 to 6.00 am on Thursday 22 May 2003.

[25] General Manager’s Certificate number 049/OFF/412/2001 issued to Kimsek Chhun will be suspended for a month from 6.00 am on Monday 19 May 2003.

DATED at WELLINGTON this 2nd day of May 2003

Judge E W Unwin Mr J C Crookston
Chairman Member

Star Mart Broadway.doc(nl)