Rising Sun Tavern v Walker [2003] NZLLA 541 (31 July 2003)

Last Updated: 2 October 2010

Decision No. PH 541/2003 –
PH 542/2003

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 variation or suspension of on-licence number 050/ON/23/99 issued to STANDARD 183 LIMITED in respect of premises situated at 31 Waimea Road, Nelson, known as "Rising Sun Tavern”

BETWEEN TREVOR VINCENT WALKER

(Police Officer of Nelson)

Applicant

AND STANDARD 183 LIMITED

Respondent

AND

IN THE MATTER of an application by KYLE ALLAN ABBOTT pursuant to s.118 of the Act for a General Manager’s Certificate

BEFORE THE LIQUOR LICENSING AUTHORITY

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

HEARING at NELSON on 28 July 2003

APPEARANCES

Sergeant T V Walker – NZ Police – applicant
Mr R J S Munro - for respondent
No appearance by or on behalf of Mr K A Abbott
Mrs A J Ward-Hamilton – Nelson District Licensing Agency Inspector – to assist

RESERVED DECISION OF THE AUTHORITY

Introduction

[1] Before the Authority are two applications. The first application is brought by the Police pursuant to s.132 of the Act. It is for the variation or suspension of an on-licence in respect of the premises situated in Waimea Road, Nelson, known as "Rising Sun Tavern”. The licence is held by Standard 183 Limited, a private company owned by Michael Joseph O’Brien.

[2] The grounds to vary or suspend the on-licence are:

(a) That the licence has been conducted in breach of ss.4, 165, 171 and 115 of the Act, and/or

(b) That the licensed premises has been conducted in breach of the condition of the licence restricting the sale of liquor from 7.00 am to 11.00 pm on Thursdays.

[3] The allegations in support of those grounds are that on 21 November 2002, at about 11.42 pm, the Police visited the premises and discovered patrons present after the premises were required to be closed, and after the “drink up” time allowed for in s.170(1)(a) of the Act. Furthermore, it was alleged that at the same time, the wrong manager’s name was displayed.

[4] The second application is an application by Kyle Allan Abbott for the grant of a General Manager’s Certificate. The application was opposed by the Police on the ground that Mr Abbott had been the acting manager of the “Rising Sun Tavern" at the time the premises were alleged to be trading unlawfully. The Police took the view that as a consequence of the incident, Mr Abbott’s suitability to hold a General Manager’s Certificate had been brought into question.

The Background Facts

[5] Mr Michael Joseph O’Brien is the sole director and shareholder of Standard 183 Limited. The company purchased the lease of the “Rising Sun Tavern” in March 1999. The company traded on temporary authorities until December 1999, when on and off-licences were issued. These licences were renewed for three years without opposition in January 2001. While the company was trading under its temporary authorities, there were one or two incidents of “after-hours” trading. However, such incidents occurred prior to the licences being issued. The fact that the licences were later renewed without opposition, would indicate that matters were resolved at the time.

[6] In April 2001, Mr O’Brien began to have concerns about the way the business was operating. In September 2001, he negotiated a management contract with Nelson Shelf (One) Limited. Under the agreement, Nelson Shelf (One) Limited was appointed overall manager of the “Rising Sun Tavern”. It assumed total control over all aspects of the business, including the recruitment and selection of staff.

[7] Paul Anthony Max is a director of Nelson Shelf (One) Limited. He holds a General Manager’s Certificate, and is the licensee of a number of on and off-licences in Nelson. He has had 25 years experience in the hospitality industry. He is currently the President of the Nelson Branch of the Hospitality Association. He stressed that the incidents referred to in paragraph [3] above occurred well before the present management agreement came into effect. Mr John Todd-Lambie is the group operations manager for the company. From what we heard, Nelson Shelf (One) Limited is an experienced and professional operator in the hospitality industry.

[8] Mr Max explained that in early October 2002, the company began recruiting for a suitable site manager for the “Rising Sun Tavern”. They were approached by Mr Kyle Abbott. Although Mr Abbott had had no direct experience in the industry, his wife had been a duty manager for four years, and Mr Abbott had worked for four years in the tourism industry. Both Mr Max and Mr Todd-Lambie believed that Mr Abbott had the attitude and ability to succeed in a management capacity. He was therefore appointed as a part time bar-person at the “Rising Sun Tavern”. He was given some training, and made aware of the trading hours contained in the licence. It was expected that he would receive further training for a General Manager’s Certificate.

[9] On 5 November 2002, Lesley Bailey formerly Lesley McCallum was appointed manager of the “Rising Sun Tavern”. She had held a General Manager’s Certificate since 1997. Staffing levels were low at the time as the previous manager and his wife had covered the majority of the shifts. On Thursday 21 November 2002, Ms Bailey worked to 8.30 pm and was then relieved by Kyle Abbott who (despite his inexperience), was appointed as acting manager. Ms Bailey neglected to change over her name as duty manager as she had been instructed. Mr Abbott made the same mistake.

[10] At about 11.42 pm, the Police entered the premises. Both the side and front doors were locked, and the Police had to knock to gain entry. Three males were sitting at a table in the sports bar. In front of them were three full glasses of beer, a bottle of Waikato beer, and an empty jug. They continued to drink while the Police were present. They seemed in no hurry to leave, and Mr Abbott seemed unconcerned. He explained that he had been appointed by Messrs Max and Todd-Lambie as an acting manager about three weeks previously. This was just to cover Thursday nights. He contended that the beer had been purchased prior to 11.00 pm, although served after that time. He said he was happy for the patrons to finish drinking, and was not taking much notice of the time. He had no excuse for what had happened. As stated earlier, the on-licence prohibits the sale of liquor after 11.00 pm on a Thursday night.

[11] Mr Max advised that immediately following the incident, Mr Abbott had been transferred to other licensed premises so that he could be under the direct control and supervision of Mr Todd-Lambie. However, Mr Abbott subsequently left his employment in June 2003 for personal reasons. He is no longer employed in the industry, and seems unlikely to return.

[12] As a consequence of the incident, the tavern now has a prohibition against the serving of jugs or quart vessels of beer 30 minutes before closing time. Furthermore an improved host responsibility policy has been put in place, and the management company holds regular reviews with work place colleagues. Currently there are three holders of a General Manager’s Certificate who work at the “Rising Sun Tavern”. In addition, a policy has been implemented whereby the nominated alarm monitoring company must inform either Mr Todd-Lambie or Mr Max, if the tavern alarm is not alarmed within a pre-determined time after closing. In this way all duty managers know that they have a limited time frame in which to complete their duties and vacate the premises. The aim of the initiative is to ensure that the “after-hours” trading incident is not repeated.

Authority’s Conclusions and Reasons

[13] First, we deal with the application by Mr Abbott for a General Manager’s Certificate. It is clear that Mr Abbott is a mature individual who presented well when interviewed, and had a good knowledge and understanding of the practical operation of licensed premises. The file shows that he completed and passed a course run by Brett Jones and Associates. However, he is no longer working in the industry, and did not appear at the hearing to support his application. The inference is that he has now lost interest in pursuing a career in the hospitality industry, and the Authority has no option other than to refuse the application.

[14] We turn then to the application to vary or suspend the on-licence. Sergeant T V Walker accepted that since the incident had to be seen as an isolated one, there was limited scope for reducing the trading hours. The hours are currently:

Monday to Thursday 7.00 am to 11.00 pm

Friday and Saturday 7.00 am to 1.00 am the following day

Sundays 11.00 am to 10 pm

These hours are governed by the restrictions against trading on Good Friday, Easter Sunday, Christmas Day and Anzac day. The hours are relatively conservative although the tavern is sited in a residential area. We do not think it appropriate to vary the hours of trading.

[15] There was no challenge to the Police evidence. The grounds for the application were established to our satisfaction. In the absence of any evidence from Mr Abbott we take the view that there was a sale and supply “after-hours”, that is after 11.00 pm. Accordingly, such sale and supply was an illegal sale under s.165 of the Act. Furthermore, the three patrons were allowed to remain on licensed premises in contravention of s.171 of the Act. There was also a breach of s.115 (2) of the Act in that the name of the duty manager was not prominently displayed as required. Finally, the licensee was in breach of the condition of the licence forbidding the sale of liquor after 11.00 pm on a Thursday.

[16] The issue in this case is whether it is desirable to make an order under s.132(6) of the Act, and if so whether the alternative use of the adjournment procedures in s.132(7) of the Act might be invoked.

[17] The Police contend that the current hours are reasonable, and were well known to the licensee. The aggravating features of the case were that the doors were locked, and neither the patrons or the manager showed any signs of leaving, or concern that trading had continued illegally. Section 115(3) of the Act places an obligation on the licensee to take all reasonable steps to enable the manager to comply with his obligations. To some extent the licensee must accept responsibility for allowing such an inexperienced person to be in charge. Mr O’Brien cannot hide behind the management company he appointed.

[18] On the other hand, Mr Munro stressed that the matter had been taken very seriously by the licensee, and the management company. Significant changes had been made to the way the business was run, and the manager was no longer employed there. It was acknowledged that an error had been made. The incident was isolated and involved three patrons who were found on premises twelve minutes after the normal “drink-up” time. There was no allegation of liquor abuse.

[19] In the recent Court of Appeal decision of Christchurch District Licensing Inspector and another v Karara Holdings Limited and others CA 178/02 13 June 2003, the Court commented on the scheme of the Act as follows:

“Section 4 expresses a philosophy concerning the social utility of controls over the sale and supply of liquor which reflects the underlying policy of the Act. Parliament has declared that the Act’s system of controls over the sale and supply of liquor should be administered so as to contribute to the reduction of liquor abuse in the community within the limits of their capacity to do so. The stipulation that the object of the Act is to establish a reasonable system of control reflects that legislative perception. It also implicitly recognises that if the administration of the Act’s licensing system becomes too heavy-handed, so that it unreasonably inconveniences those wishing to purchase and consume liquor in a manner not giving rise to abuse, that result would be inconsistent with the statutory object.”

[20] After balancing all competing factors in this case, we have come to the view that the proceedings should be adjourned for a period of six months, to give the licensee the opportunity of continuing to remedy its management of the business, with the aim of ensuring that there will be no repetition of illegal trading. In fixing the period of six months, we note that nine months have elapsed since the incident, and there has been no suggestion that the provisions of the Act, or the condition of the licence have been ignored, during that time. We take the view that a suspension order in this case could be seen as “heavy handed”.

[21] Accordingly we make the following orders:

(a) The application by Kyle Allan Abbott for a General Manager’s Certificate is refused.

(b) The application by Trevor Vincent Walker for variation or suspension of on-licence 050/ON/23/99 issued to Standard 183 Limited, is adjourned for six months to give the licensee the opportunity to ensure that its management practices are such that there are no further incidents of trading unlawfully. If after six months, no such incidents are recorded, then that will be the end of the matter. If any allegations of unlawful trading are made during that time, a further public hearing will take place to reconsider the application.

DATED at WELLINGTON this 31st day of July 2003

Judge E W Unwin Mr J C Crookston
Chairman Member Rising Sun.doc(nl)