Ned's Place Limited, re [2008] NZLLA 1686 (4 December 2008)

Last Updated: 12 February 2010

Decision No. PH 1686/2008

IN THE MATTER of the Sale of Liquor Act 1989

AND

IN THE MATTER of an application by NED’S PLACE LIMITED pursuant to s.18 of the Act for renewal of an on-licence in respect of premises

situated at 30 Forest View Road, Mangakino, known as “Ned’s Place”

BEFORE THE LIQUOR LICENSING AUTHORITY

Chairman: District Court Judge E W Unwin
Member: Mr P M McHaffie

HEARING at TAUPO on 18 November 2008

APPEARANCES

Miss H A Aitken – on behalf of applicant
Mr G A Singer – Taupo District Licensing Agency Inspector – to assist
Mr E J Foley – Taupo District Council – in attendance

Objectors
Mr G D Brunton
Mrs M Brunton

RESERVED DECISION OF THE AUTHORITY

Introduction

[1] This is an application by Ned’s Place Limited (hereafter called "the company"), for the renewal of its on-licence. The licence was first granted on 11 September 2007. The application represents the first renewal following the initial ‘probationary’ year. No changes were sought to the conditions of the licence. There was no opposition from the Police, the District Licensing Agency Inspector, or the Medical Officer of Health.

[2] The business is licensed in the style of a restaurant, and trades under the name of “Ned’s Place”. The on-licence permits trading hours from 10.00 am to 9.00 pm Sunday to Thursday, and from 10.00 am to 11.00 pm Friday and Saturday. However, trading is only permitted when the premises are being operated as a restaurant. The café/pizzeria is a 1920s villa that was transported to the site, and refurbished into a restaurant. The refurbishment took about a year to be completed. There is an outside deck that is also used for dining and drinking.

[3] The surrounding area can best be described as rural/residential. However there are retail businesses as well as a service station at the Whakamaru Junction, approximately 150 metres to the north. Resource consent was granted on a non-notified basis on the ground that the proposed activity as a pizzeria restaurant would have no more than minor adverse environmental effects on the area. However, in the consent document it was stated that certain landowners might be adversely affected by noise and traffic generation, but that these landowners had consented to the proposal.

[4] Herein lies the problem. For some unexplained reason, Mr and Mrs Brunton (the present objectors) were not included in that process. According to a resource consent report dated 31 March 2006, the Bruntons were listed as affected neighbours. However a subsequent report dated 22 June 2006, excluded them. The Bruntons reside immediately across State Highway 30 from “Ned’s Place”. It is clear from the evidence that their quality of life has been affected by the activities at the restaurant since it opened for business. Unfortunately, their concerns have not evoked much sympathy or indeed, respect. As a result, a certain amount of enmity has developed between the parties.

[5] The situation was not helped when the Bruntons’ objections were attached to a petition that customers and other residents had been asked to sign, in order to add support to the renewal application. In addition, some of the patrons have allegedly shown disrespect to the Bruntons and their family. One of the features of a restaurant style licence is that there is no requirement for patrons to leave the premises when the sale of liquor must cease. As a consequence the continued presence of patrons (and sometimes their children), on or about the premises has been the cause of some criticism.

[6] The renewal application is the first to be dealt with since the business was established, and is therefore the most important. As a matter of law, all new licences are granted for one year. This is sometimes called a ‘probationary’ year and gives neighbours as well as the reporting agencies the opportunity to monitor the business. If an applicant shows a lack of commitment to the conditions of the licence or to expected standards of host responsibility, then we have the power to refuse to renew the licence or, change the conditions of the licence, with particular attention to the trading hours. In this way all licence holders have a clear incentive to show that that are not only committed to the welfare and safety of their patrons, but also to the rights of neighbours to the quiet enjoyment of their property.

[7] In this case public notification of the renewal attracted two separate public objections from Mr and Mrs Brunton. The grounds for their objections included the licensee’s lack of suitability, inappropriate hours, and a tendency for the premises to be treated as a ‘local’, in breach of the conditions of the licence. It is noted that the original licence was granted without objection.

The Application

[8] Miss Hayley Anne Aitken (formerly Hayley Allen) is the company’s sole director and shareholder. She confirmed that she currently closes the premises on Mondays and Tuesdays. She produced a petition with some 237 signatures. The petition had been left in the town as well as in the restaurant. The petition expressed support for the renewal of the licence. Unfortunately it also sought to marginalise the objectors. The document stated:

“We do not agree with the objections against Hayley Allen’s application, made by a minority group in the area, and wish to see Ned’s Place carry on business as usual for the immediate and long term future, and betterment of this regions socio-economic and hospitality status.”

[9] In addition, Miss Aitken referred to a comprehensive and supportive letter that had been written by Mr and Mrs K Russell of Whakamaru. They live in the vicinity of the restaurant. They also sought to criticise the objectors in these terms:

“In closing all I can say is that I sometimes find it hard to fathom the ‘single-mindedness and tunnel vision’ of some people, and why sometimes the few always try to spoil things for the many. I do hope you read and consider this rather long letter with a view to approving Miss Aitken’s on-licence renewal, and rejecting the petty ‘sour grapes’ from a minority that prefer to promote the Tokoroa region and see it get ahead, rather than their own.”

[10] In their letter, Mr and Mrs Russell acknowledged that several locals, and others, frequented the establishment and drank there on a regular basis. They said they did so because of the quality of the food, the great service and the clean and safe family atmosphere.

[11] Miss Aitken contended that people arrived as late as 9.00 pm on Friday and Saturday nights expecting a meal, and that the kitchen was kept in operating condition until the bar was closed, and the last drink was served. She denied any suggestion that the business was being operated as a tavern, and stated that any music was background only. She claimed that there had never been any incident involving an intoxicated patron or a minor. Miss Aitken acknowledged that she had attempted to get Mr and Mrs Brunton to consent to the original proposal without success. She argued that about 2000 vehicles used the State Highway each day. She understood that 16%-18% of the vehicles were trucks, producing a considerable amount of noise.

[12] Miss Aitken produced photographs of three customers who were having a drink on the deck while apparently waiting for their meals to be cooked. She stated that Mrs Brunton had come to the front of her home and taken photographs of the group. In one photograph the customers appear to be eating pizzas while standing up. According to Miss Aitken the photographs were taken at 7.10 pm.

The District Licensing Agency Inspector

[13] Mr G A Singer is an Inspector with the Taupo District Licensing Agency. In his report he stated that an inspection had been carried out on 1 October 2008. He concluded that the premises were being operated in accordance with the licence and the Act. He had noted that there was music coming from one of the houses, and thought that this noise might have supplemented any noise from activity at “Ned’s Place”. Mr Singer explained that under the Act, he had a responsibility to report on the application, which was why he had made the visit. He has no similar obligation to report on the objectors.

The Objectors

[14] Mr Garry Brunton stated that he and his wife and family had lived at the address ‘off and on’ for 20 years. He explained that he and his wife had filed separate objections because they differed on the reasons that they were objecting. He asked that the closing time on the Friday and Saturday be reduced from 11.00 pm to 9.00 pm. He claimed that his house was the most negatively affected by the restaurant of all the nearby properties. He stated that all three bedrooms in his house faced “Ned’s Place”, and were about 40 metres from the restaurant veranda. He noted that after 5.00 pm traffic on the highway was minimal, and therefore any noise or activity from the restaurant, particularly after 9.00 pm, had an adverse impact on the quiet enjoyment of their property.

[15] Mr Brunton produced a company advertisement that referred to "Ned’s ... It's your local since 2007". He believed that after 9.00 pm, the premises were being operated as a bar or local, and suggested that on many occasions people were drinking and partying. In other words the premises had become something of a gathering point for the area. He argued that in the rural environment there was little demand for late dining. He referred to the fact that people were on the premises after midnight. He stated that on one occasion members of staff and/or guests had left the building at about 2.30 am. Mr Brunton stated that as the night progressed, there was a proportional increase in noise, music, cars arriving and departing, profanity, and general bad behaviour.

[16] Mr Brunton believed that there was a direct link between the consumption of liquor and the escape of noise. He also explained that patrons sat on the veranda drinking and watching them. On two occasions he said there had been abuse directed towards himself and his family. He explained that he had been able to hear what patrons were talking about.

[17] Mrs Margaret Brunton was quite objective and persuasive. She stated that she had no objection to the licence being renewed, provided they were allowed to enjoy their own property in relative peace. She referred to the impact of being excluded from the resource consent process, as a result of which they were denied the opportunity of making submissions about such matters as operating hours and noise. She also gave evidence that there were times when it appeared that the premises were being operated more as a bar than a restaurant. She thought that the site was the wrong place for the sale of liquor to 11.00 pm.

[18] Mrs Brunton explained that there were no problems during the day but at night, they were able to hear conversations between patrons, many of which they preferred not to hear. She stated that on Thursday, Friday and Saturday nights, there were much louder noise levels as patrons yelled out to each other as they were leaving. In addition the bass sound from the music could be heard. She explained how difficult it was for them to raise concerns at the time of any incident, or object to the renewal process. She thought that there were times when Miss Aitken was not present, and consequently, there was less interest in keeping control of the patrons. She also commented that young children were often present at all hours.

The Authority’s Decision and Reasons

[19] Pursuant to s.22 of the Act we are required to have regard to the following matters when considering the application:

(a) The suitability of the licensee;
(b) The conditions attaching to the licence;

(c) The manner in which the licensee has conducted the sale and supply of liquor pursuant to the licence; and

(d) Any matters dealt with in any report made under s.20 of this Act.

[20] All the above criteria are relevant to the application. It is up to the company to establish its suitability to continue to hold the licence in its present form. As stated earlier this issue is particularly significant following the first ‘probationary’ year. In Page v Police (unreported HC V Christchurch AP 84/98 24 July 1998) Panckhurst J commented on the issue of suitability in this way.

“Section 13(1)(a) provides that the applicant for an on-licence must demonstrate his or her suitability. In other words what is required is a positive finding. That implies an onus upon the applicant to demonstrate suitability. Such suitability is not established in a vacuum but in the context of the particular case: for example, the place, the intended business (here in a difficult central city location), the nature of the business itself, the hours of operation and the intended activities, provide the basis for the assessment of the individual.”

[21] What we are discussing here is a reasonably new café/restaurant located in a rural area. There is a significant difference between a restaurant where people may gather to dine and at the same time enjoy a glass of wine or other liquor as part of their meal, and a bar, where patrons congregate in order to have a drink, and socialise or listen to music. While the Act allows for casual drinking, the conditions of the licence make it clear that liquor may only be sold when the premises are being operated as a restaurant. For example, operating a restaurant does not include allowing pizza to be consumed by patrons who are standing outside on the deck as shown in the photographs.

[22] We do not expect to hear of noise complaints from the running of a well-managed restaurant. On the other hand we accept that in this case, much of the evidence was short on specifics. In the decision of The Narrows Landing Limited LLA PH 479/2003 it was stated:

“Nevertheless unless neighbours are prepared to provide details of when the breaches of the Act or the Resource Management Act occur and what action was taken, it would be difficult for them to overcome the threshold of factual information required to put the Applicants to proof.”

[23] The company’s case lacked attention to the way that the problems of nuisance were being addressed. There was no evidence about any noise management plan or attempt to deal with the problems being encountered by the neighbours. On the other hand, we believe that Miss Aitken established her suitability particularly given the lack of concerns expressed by the Police, the Inspector and the Medical Officer of Health. At the same time we believe that Miss Aitken needs to be less indifferent to her neighbours. In our view, the insensitive public display of legitimate objections shows a lack of suitability. To continue to remain open, albeit without selling liquor at this particular site, while perfectly legitimate, could be an unreasonable imposition on the people who live nearby. However, we accept that this issue is primarily a matter for the local Council.

[24] In our view, the overall manner in which the company has conducted the sale and supply of liquor pursuant to the licence has been less than exemplary. Granted there was no evidence of intoxication. However, in our experience there have been only a few first-time renewals that have given cause for these sorts of concerns. We were left with the impression that there would be times when the main focus of the premises would be on the supply of liquor. The company needs to review its concept of the restaurant being used as a “local”. It may even have to consider preparing and implementing a noise management plan if it plans to continue operating the business in its present format.

[25] On the issue of noise, we remind the company of our comments in Paihia Saltwater (2001) Limited LLA PH 391/2001:

"[27] It is our view that no one should have to put up with persistent interference with their sleep patterns. We do not think it is sufficient to submit that a true test is the number of calls to the licensed premises or to the Noise Abatement Officer. We have heard enough evidence to suggest that making such calls in the early hours of the morning is unpleasant and often unrewarding.

[28] Noise is not just a resource management issue. The escape of noise (particularly music) is an example of bad management. The Authority takes the view that if no attempt is made to prevent the escape of, or reduce noise, then it is the Authority’s duty to monitor the hours of opening, if not the existence of the licence.

[29] We have already heard from licence holders who have either installed air conditioning so they can keep doors and windows closed, or have employed security people to monitor outside noise, or they have installed automatic sound control systems. We will always give full credit to those holders who acknowledge any existing noise problem and try and do something about it. In our view the term ‘host responsibility’ does not exclude the people who live nearby.

[30] Many licensed premises have shown that they can operate in harmony with their residential neighbours. It is no coincidence that the managers and owners of such premises also show a commitment to the reduction of liquor abuse."

[26] In considering an application for the renewal of an on-licence, we are also governed by s.23 of the Act. That section reads:

(1) After considering an application for the renewal of an on-licence, the Licensing Authority shall –

(a Renew the licence on the conditions presently attaching to it; or

(b) Renew the licence on such different conditions (relating to

any matters specified in section 14(5) of this Act) as the Licensing Authority thinks fit; or

(c) Refuse to renew the licence.

(2) The Licensing Authority shall not exercise its powers under paragraph (b) or paragraph (c) of subsection (1) of this subsection except in response to –

(a) An objection duly made under section 19 of this Act; or
(b) A report duly submitted under section 20 of this Act; or
(c) A request by the applicant.

[27] It follows that on considering any renewal application, the Authority may in its discretion alter the trading hours in response to reports or objections. We are given the power to review the days on which, and the hours during which liquor may be sold. The regulation of the hours of trading has always been recognised as a useful tool in controlling behaviour arising from liquor consumption. Decisions of the Auckland High Court in Sheepys Limited AP77-SW01 and Club Raro Limited AP86-SW01 both dated 10 December 2001, confirm the Authority’s discretion to cut back a licensee’s operating hours on a renewal. In the former case, O’Regan J stated:

“The Authority was entitled to consider the impact of noise as an aspect of the manner in which the licensee had conducted the sale and supply of liquor pursuant to the licence (s.22(c)), and was also entitled to consider this because of the relevance of s.14(7) to its consideration of conditions under s.23(1)(b).

[28] On the other hand we are not unaware of the need to be reasonable given the lack of liquor abuse issues. The main reason for altering the trading hours would be to ameliorate the nuisance caused to the neighbours. There was little expert evidence on the issue of noise or disturbance apart from what we heard from the Bruntons. In an attempt to reduce the impact of the business on the neighbours, we propose to severely reduce the hours that the outside deck is used. We see no reason for this to be used in the evenings other than by smokers. There is no reason why they should have the right to drink outside, particularly in the context of a restaurant style licence, and particularly given the proximity to residential neighbours.

[29] In the decision of Murray William Doreen LLA PH 218/2003 the following comments were made:

“It has been our experience with other licensed premises in rural areas, that when premises are used as venues for other events such as weddings etc., then noise and nuisance issues follow. Sound has much more impact in a country atmosphere.” [Emphasis ours]

[30] Accordingly we propose to make certain changes which should not be regarded as final. We had considered reducing the period of renewal but this could be a costly process for the company. The company has the right to request special licences for events. It is entitled to apply at any time within the next three years to have the trading hours (including those on the deck) extended. This might well mean a further hearing at which further evidence could be received. If the company initiates some changes it is possible that there will be no objections to such an application. It is also possible that the company may be able to reach an accommodation with the neighbours. These are matters for the future.

[31] By way of a summary only, we repeat what was said in Ocean Focus Limited LLA PH 579/2004:

“The company needs to be aware that a licence is a privilege and not a right. It is not a guarantee of profitability, and its holder acquires certain responsibilities. It is apparent that the applicant has become blinded by its perception of the type of business that it wants to operate regardless of the conditions of its licence, and regardless of consideration to its neighbours. It is in the applicant’s best interests to get on well with its neighbours.”

[32] Accordingly, and for the reasons given, we order that the on-licence issued to Ned’s Place Limited is renewed for three years to 11 September 2011. The trading hours will be:

Outside deck: Monday to Sunday 10.00 am to 3.00 pm

Main Building: Sunday to Thursday 10.00 am to 9.00 pm

Friday and Saturday 10.00 am to 10.00 pm

DATED at WELLINGTON this 4th day of December 2008

Judge E W Unwin
Chairman

Ned’s Place.doc