Wright v Rightside Properties Limited - Kaikohe Hotel [2008] NZLLA 632 (14 May 2008)

Last Updated: 11 May 2015

Decision No. PH 632/2008

PH 635/2008

IN THE MATTER of the Sale of Liquor Act 1989

IN THE MATTER of an application pursuant to

s.132 of the Act for suspension or cancellation of on-licence number DLA/01/ON/006/2007 and off- licence number DLA/01/OFF/002/2007 issued to RIGHTSIDE PROPERTIES LIMITED in respect of premises situated at 67 Broadway, Kaikohe, known as “Kaikohe Hotel”

_AND

IN THE MATTER of an application pursuant to

s.135 of the Act for suspension or cancellation of General Manager’s Certificate number

01/GM/046/2003 issued to NEAL ALAN SUMMERS

BETWEEN GRAEME LESLIE WRIGHT

(Police Officer of Kerikeri)

_Applicant

AND RIGHTSIDE PROPERTIES LIMITED

_{First Respondent}

_{AND NEAL ALAN SUMMERS}

_{Second Respondent}

_AND

IN THE MATTER of applications by RIGHTSIDE PROPERTIES LIMITED pursuant to ss.18 and 41 of the Act for renewal of on and off-licences in respect of premises situated at

67 Broadway, Kaikohe, known as

“Kaikohe Hotel”

_{BEFORE THE LIQUOR LICENSING AUTHORITY}

Chairman: District Court Judge E W Unwin

Member: Mr P M McHaffie

HEARING at KAIKOHE on 10 April and 2 May 2008

_APPEARANCES

Senior Constable G Wright – NZ Police – applicant and in opposition to renewal of on and off-licences

Mr N A Summers – second respondent – and representing first respondent and applicant for renewal of on and off-licences

Mr J A Thorne – Far North District Licensing Agency Inspector – to assist

_{RESERVED DECISION OF THE AUTHORITY}

Introduction

[1] There are effectively four matters before the Authority for determination. They all relate to a hotel, trading as the “Kaikohe Hotel”, situated in the main street of Kaikohe. The premises have been trading under present ownership since the existing business was purchased in 2006. The on and off-licences were granted to Rightside Properties Limited (hereafter called the company), on 1 March 2007.

[2] Mr Neal Alan Summers is the company’s sole director and shareholder. He has held a General Manager’s Certificate since 2003. Pursuant to the on-licence, liquor may be sold at any time on any day to any person who is for the time being living on the premises. The authorised trading hours for both licences are:

Monday to Sunday 7.00 am to 1.00 am the following day.

[3] When the company took over the hotel, it was in a run down condition. There were a large number of buildings. Mr Summers excluded them from the licence and rented them out. There were up to thirty-one rooms upstairs. Some of these were converted to self-catering units. Mr Summers had to clean and renovate the premises including electrical and plumbing maintenance. His plans were delayed when he discovered that an employee had stolen in excess of $20,000 from the TAB. There are now 24 long-term guests. Four of the units are occupied by contract farmers.

[4] On 10 December 2007, the Authority received applications for the suspension or cancellation of the company’s on and off-licences, as well as Mr Summers’ General Manager’s Certificate. The grounds for the application to suspend or cancel the on and off-licences were that the licensed premises had been conducted in breach of ss. 115, 154A, 155, 162, 163, 164, 168, 170, 171, 172A, and 175 of the Act. Although unspecified, it was clear that the application also alleged that the company’s conduct was such as to show a lack of suitability to hold the licences.

[5] The grounds for the application for the suspension or cancellation of the General Manager’s Certificate were also unspecified. From the particulars, it was clear that the Police were referring to Mr Summer’s alleged failure to conduct the premises in a proper manner, and further that his personal conduct was such as to show a lack of suitability to hold the certificate.

[6] The particulars in support of both applications consisted of a seven-page document referring to 19 separate incidents or matters between 21 February 2007 and 22 November 2007. Apart from the licensing breaches, there were allegations of inappropriate behaviour by Mr Summers in respect of his relationship with staff, patrons, and regulatory personnel. It was contended that he was dismissive of compliance matters such as the provision of food, smoke-free procedures, as well as issues concerning intoxication. He was described as obstructive and uncooperative. In summary, the Police alleged that Mr Summers was unsuited to be either the licensee or manager of licensed premises.

[7] While the applications were being processed, the on and off-licences fell due for renewal following the first probationary year. There was opposition to both renewals from the Police and Medical Officer of Health. The Police opposition centred on the enforcement applications that had already been filed. The Medical Officer of Health’s concerns related to the company’s non-compliance with the licence conditions, and in particular, insufficient provision of food. The District Licensing Agency Inspector noted that he had had cause to speak with Mr Summers on such diverse matters as advertising free beer, permitting smoking on the premises, opening on Anzac Day, and lack of co-operation with the Police. Interestingly, there were no public objections.

[8] Mr Summers represented himself and his company. He sought to show that there were two sides of every incident. He responded to all the allegations and gave explanations where necessary. He argued that there was no direct evidence to support the majority of the material introduced by the Police. He contended that the applications had no factual basis, and were based on the untested hearsay statements of others.

[9] A week before the hearing, Mr Summers instructed a lawyer to request an adjournment of the applications for 60 days. It was contended that Mr Summers was seeking access to the Police files. In addition it was argued that Mr Summers had insufficient time to brief witnesses. The adjournment application was declined, but Mr Summers was afforded the opportunity to hear and cross-examine the Police witnesses. It was indicated that the applications could then be adjourned on a part- heard basis, to enable him to prepare evidence in rebuttal. Mr Summers took advantage of the offer, and the hearing was resumed three weeks later.

[10] There were a large number of witnesses and allegations. The task we faced was to determine where the truth lay in respect of each individual complaint. This involved deciding credibility issues, and on occasions, drawing inferences from the facts. Because the case was so complex and there were so many allegations, we have found it more convenient to set out the facts separately, and incorporate our findings on each separate issue.

First Complaint - General

[11] Ms Tracey Kareena Dalton is the Chairperson of the Western Community Board (the Board). Pursuant to s.52 of the Local Government Act 2002, the Board’s role is to represent and act as an advocate for the interests of the community. Ms Dalton sought to represent the public perception of the way that Mr Summers operated the hotel.

[12] Ms Dalton alleged that Mr Summers had used chalk on the newly laid footpath adjacent to the hotel to advertise liquor promotions. She stated that he regularly used his bicycle to ride around the township without a helmet. She produced a letter of complaint from a citizen addressed to the District Council about that matter. She also produced a letter from the Kaikohe Business Association stating that Mr Summers had been asked to mow the lawns at the front of the hotel as part of a community effort to improve and maintain the town’s business area, but had failed to do so.

[13] Mr Summers accepted that he had not worn a helmet while biking. He said he had been in an accident many years ago and had impaired hearing as a result. He confirmed that when complaints were lodged, he had decided not to ride the bike any more. We understood Mr Summers to say that the advertising on the footpath pavement had stopped. We took a view of the premises. As far as we could tell the lawns had been mowed.

[14] In assessing the evidence, we had no reason to doubt what Mr Summers told us. Our summary of this complaint is that while Mr Summers is not universally liked or respected in the community, the evidence did not warrant either the suspension or cancellation of the licences, or the refusal to renew them. We note that Mr Summers produced a few supportive references. He has attended Accord meetings, and he has improved the hotel from what it was when he purchased it. His brief of evidence and final submissions were well researched, and indicated that he had taken the various criticisms seriously.

The Second Complaint – Sub-Leasing to a Known Gang Member

[15] Ms Dalton complained that the company had a tenant operating a K1 Kick-Box training centre, and that the centre was run by a known member of the ‘Tribesman’ gang. The concern was that the centre attracted youth to hang out outside the hotel.

[16] Sergeant R D S Laurie was stationed at the Kaikohe Police Station until November 2007. He produced a circular headed ‘Elite Thai Kickboxing’. The document indicated a busy programme involving classes every day between 10.00 am and 8.30 pm. Judging by the comments made in the circular, the activity seems genuine. On the other hand there were suggestions that the centre could be used to recruit new members to the gang.

[17] Mr J A Thorne has been employed as a Licensing Inspector by the Far North District Council for three years. He advised Mr Summers of the need to have the dining room area taken from the redefinition of licensed premises, as the area was part of the building leased for a gym. He confirmed that no application had been made.

[18] Senior Constable G L Wright holds the position of Far North Alcohol Co- ordinator. He produced a statement from a woman who stated that she had visited the gymnasium on 3 November 2007. She had seen 15 to 20 people sitting round a table drinking. She also stated that they were in possession of drugs. Mr Summers asked why the person was not called as a witness given that she lives locally. He submitted that her credibility would have been the central theme of any cross- examination.

[19] Mr Summers confirmed that in August 2007, he was approached by a licensed real estate agent who was acting for a person seeking to set up a gym. He knew that the hotel’s old dining room and kitchen had not been used for years. He then met the tenant. Neither he nor the agent knew anything of the tenant’s gang connections. Mr Summers went to the trouble of contacting the previous owner of the hotel as the tenant had previously worked for her. He was given a positive reference. Accordingly a two-year lease without a right of renewal was signed.

[20] Mr Summers said that there had not been any problems with the tenant, and the group had never caused any trouble. On the other hand Senior Sergeant J L Rogers stated that regrettably, the ‘Tribesman’ gang was now an overt presence in the town. Mr Summers has been remiss in not having the former dining room removed from the definition of licensed premises. However, there was no proof that he had knowingly let out part of the hotel premises to a gang. We agree with him that he is unlikely to be intimidated in the way he runs the premises. The facts show that he made a commercial decision based on reasonable grounds.

The Third Complaint – Breach of Licence Condition re Food Availability

[21] Senior Constable Wright produced reports from an unnamed private investigator about visits made on 10 and 15 November 2007. On the first occasion, the investigator asked for food at about midnight but was advised that the kitchen was closed. On the second occasion the investigator asked for a hot pie and was advised that there was no hot food, only peanuts and chips. Had there not been similar independent evidence, this evidence from an unknown person would have been ignored.

[22] Mr J G Garnham has been a Health Protection Officer with the Northern District

Health Board for the past 15 years. He gave evidence of a visit to the premises on

22 November 2007. The only food available was chippies and nuts. Mr Summers told him that he was waiting for a new freezer for pies. Other non-compliance issues included the lack of a first aid kit, an uninstalled hand basin in a toilet, and an area under the bar that required finishing.

[23] On 14 December 2007 there was a follow up visit. On this occasion there was some food, being 10 pies and pizza, stored in the beer chiller. The new freezer had not arrived. When questioned about the adequacy of the food, Mr Summers stated that there was little demand and that he got more food in every few days.

[24] Mr Garnham visited the premises on 21 February 2008 as part of the renewal process. There were 10 pies and pizza’s on the premises, and only one sign advertising their availability. There was no other promotion of food. The only food displayed was eight small packets of chippies. The only low alcohol beers on display were six Amstel lights.

[25] Mr Garnham produced a report from the Medical Officer of Health concerning monitoring visits on 13 and 20 March 2008. It was noted that there was a blackboard on the wall, but no food options were displayed. Attempts to purchase food resulted in only two options. Pies or pizzas could be heated for $5 each. It was thought that the price was expensive for the quality of the food. On one occasion, a member of the monitoring staff was directed to a service station when food was requested. In addition a patron was observed smoking inside but close to the entrance door. No intervention by staff was noted.

[26] Mr Thorne complained that when Mr Summers made application for the on- licence, he produced a menu that included such items as seafood basket, prawns, and seasonal salads. His Host Responsibility Policy advised that the items on this menu would be available during opening hours. Mr Thorne contended that the food currently on offer was not comparable to the items shown on the menu.

[27] Mr Summers said that when he took over the hotel he had submitted an extensive menu, but found that the patrons did not like the food. He surveyed the patrons and found they liked pies and pizza. He accepted that in November 2007, he was waiting for the new freezer to be wired up. He said that this was completed by February 2008. He argued that the blackboard on the wall was an old piece of memorabilia that he had inherited. He accepted that because the blackboard referred to a menu, it could have been misinterpreted, and he undertook to have the wording or the board removed. He produced a photograph showing that the availability of hot pies and pizza was now being promoted.

[28] In our view, Mr Summers displayed a lack of commitment to the need to promote the consumption of good food. The suggestion that his patrons had dictated the type of food they expected is not acceptable. Until recently, he has breached the condition of his licence by failing to notify patrons by appropriate notices, of the availability of food. In general terms, we do not accept that having pies and pizza available is satisfactory, although we acknowledge that there is technical compliance with the conditions of the licence. Mr Summers explained why there were occasions when there was no food at all.

The Fourth Complaint – Breach of the Smoke-free Environments Act 1990

[29] Ms Wendy Antrobus is a designated Smoke-free Enforcement Officer. She visited the hotel on 25 July 2007 following complaints about smoking patrons within the internal areas of the premises. She regarded Mr Summers’ attitude as disinterested. He told her that a high proportion of his patrons smoked, and there was a problem when it was raining. He stated that he was having an awning installed. This has since been erected. Mr Summers was given a warning about a possible prosecution if he continued to allow patrons to smoke inside.

[30] Mr Summers was written to about the issue and responded by saying that he would always comply with all rules to help achieve a smoke-free bar.

[31] Sergeant Laurie visited the premises on 29 June 2007. He noticed a patron smoking in the bar. She had an ashtray in front of her. He told the barman who then told the patron to put her cigarette out. The patron claimed that she had been told by the bar staff that she could smoke in the premises. She said that she had asked first. She also said she had been given permission to smoke the night before.

[32] On 18 July 2007, Mr Thorne found a patron smoking in the gaming machine area. Another patron had an unlit cigarette in his mouth. Mr Summers was warned. He replied that the hotel was large, and that he could not be expected to be everywhere. He was told that he might have to hire more staff.

[33] When he gave evidence, Mr Summers stated that the majority of his patrons were smokers, and that trying to get them to stop smoking inside the premises had been difficult. He contended that it was an ongoing process trying to educate his patrons. He said that the numbers of people smoking inside was reducing or getting better. He thought he was “winning”.

[34] In our view Mr Summers displayed a lack of commitment to the need to prevent smokers from smoking inside. He declined to take responsibility for enforcing the law, and seemed to put the blame on the patrons.

The Fifth Complaint – Promotion of Excessive Consumption

[35] In March 2007, Mr Thorne found an advertisement promoting a poker tournament at the “Kaikohe Hotel” with free beer. He spoke with Mr Summers advising him that his duty was to reduce the harm caused by liquor and not to promote it. Mr Summers stated that he would remove all the signs. He apparently did so.

[36] Mr Summers stated that with regard to the poker tournament, he had not been given the opportunity to proof read the advertisement. He said that his intention had been to offer a free beer when a patron registered for the tournament. He said he had no intention of breaching s.154A of the Act, and had not only removed all the advertising, but also apologised to Mr Thorne. He pointed out that in the same publicity free beer was to start at 6.00 pm, and yet beer was shown as being for sale for $6.

[37] Although we thought the explanation was lame, it could not be disproved. Given that beer was shown as being for sale at the same time as it was shown as being free, Mr Summers is entitled to the benefit of the doubt on this issue. We do not believe that there was a breach of s.154A of the Act.

The Sixth Complaint – Alleged Assaults

[38] Sergeant Laurie stated that on 21 February 2007, he had attended an incident where a patron reported a dispute with Mr Summers. It was alleged that during the argument, Mr Summers had thrown a glass of coke over the patron. The Sergeant gave his assessment of what had happened because he had seen a video of the incident. The video had been handed to the Police by Mr Summers but was not produced at the hearing. Sergeant Laurie said that Mr Summers had been warned over the matter.

[39] Mr Summers gave evidence that the complainant’s daughter had been a tenant of one of the rooms in the hotel. She failed to pay her rent and was evicted. He said that the complainant came into the bar and was abusive and threatening. Mr Summers had a glass of coke in front of him. He said that the complainant went to grab the glass. He thought she was going to throw the coke over him, so he grabbed it at the same time. In the event some of the coke spilled over the complainant and she left.

[40] We have some sympathy for Mr Summers in the way this incident was presented. We did not hear from the complainant. We did not see the video. Mr Summers was the only witness who gave evidence on oath and was available to be cross-examined. His argument that there was no direct evidence about the incident is valid.

[41] The same argument applies to another similar incident. Sergeant Laurie gave evidence that on 30 March 2007 another complainant had laid a complaint of assault. The Sergeant described the allegations. They included a claim that Mr Summers had been drinking. He acknowledged that when advised of the details of the complaint, Mr Summers had denied any wrongdoing. When he gave evidence Mr Summers not only denied that he had been drinking, he produced a letter from Constable Sarah Hewitt of the Kaikohe Police Station, in which she confirmed that having looked into the matter, she was satisfied that no assault had taken place.

[42] Once again Mr Summers was the only witness. His character had been brought into question where no proof of any misconduct existed. Indeed the Police files disclose the opposite to have been the case. In our view the incident should not have been part of the Police case.

[43] Senior Constable Wright produced a complaint by a patron who was in the premises on 2 November 2007. The patron had apparently been asked to leave the gaming machine area, and had then been the victim of an unprovoked punch from Mr Summers. However no action was taken and it was unclear whether Mr Summers had even been approached about the matter. Mr Summers noted that the complaint had been taken three days after the alleged assault. We thought that all three complaints lacked probative value.

The Seventh Complaint – Illegal Trading on Anzac Day

[44] Sergeant Laurie produced a report from another Sergeant in which it was alleged that at 11.51 am on Wednesday 25 April 2007, the second Sergeant had visited the “Kaikohe Hotel”. This was the morning of Anzac Day. Mr Summers told the visiting Sergeant that the bar was only open for persons who reside at the hotel. However he confirmed that the front door was open to members of the public so they could play the gaming machines. He was adamant that the only people being served were residents. The Sergeant reported that he had suggested that it was not possible to distinguish between residents and members of the public. In his report he alleged that Mr Summers had then perused the customers and removed liquor from customers who were not residents.

[45] Sergeant Laurie said that he made enquiries but was unable to locate any persons who had been drinking that morning. He said that he spoke with Mr Summers later. He wanted to find out the names of the patrons. He issued Mr Summers with the normal Police warning advising him that he was not obliged to say anything. Mr Summers elected not to do so. Subsequently, the Sergeant was advised by Mr Thorne that he had the right to request such information under s.175(3) of the Act.

[46] Mr Summers then supplied a full written statement. He confirmed that the only persons who were served were the residents of the hotel and an overnight guest. He gave some of the names. He said that he had removed bottles from patrons, and

told them that there would be no more drinking until 1.00 pm because he did not want to irritate the Sergeant. When he gave evidence, he said that he had only removed empty bottles. Mr Summers confirmed that he had 28 long-term guests and he knew who they were.

[47] The job sheet submitted by the visiting Sergeant is basically hearsay material, and does not have the same probative value as a person giving evidence on oath. In this incident Mr Summers stated that he was initially given the opportunity not to make a statement and accepted the invitation. When he and the Sergeant were appraised of s.175 of the Act, a statement was given. There was no evidence that Mr Summers was obstructive as had been alleged. There was no evidence that he trading illegally. On the other hand, members of the public who were playing the gaming machines, and who were not present for the purpose of dining, should not have been allowed on the premises. They were in breach of s.170(1)(b) of the Act, and the company was in breach of s.171 of the Act.

The Eighth Complaint – Breach of s.115 of the Act

[48] Sergeant Laurie produced a note book entry signed by a Constable who had visited the hotel at 10.50 am on 23 May 2007 and was unable to locate the duty manager. The bar person told the Constable that Mr Summers had left at about

10.30 am to go to Kerikeri. At 12.05 pm Mr Summers sent the Constable an email saying that he had just returned form an appointment with his accountant.

[49] The Sergeant also confirmed that he had visited the premises on 21 July 2007 when no manager was present. He had asked the person in charge of the bar to call Mr Summers and had waited for 10 minutes but Mr Summers did not appear.

[50] Senior Constable Wright gave evidence that on 8 June 2007, he visited the premises and noted that no duty manager details were shown. He spoke at length with Mr Summers about this. He also produced reports from an unnamed investigator on 10 and 15 November 2007. These showed that on the first visit there were three nominated duty managers, and the same three persons were the nominated duty managers on the second occasion.

[51] Senior Constable Wright gave evidence that on 15 November 2007 he had visited the premises to find that the names of three duty managers were displayed. He spoke with the person behind the bar and asked her who the duty manager was. She said that she was because she was the only one working there. The Senior Constable then spoke with Mr Summers whose name was also displayed. He was adamant that a number of other hotels had the same situation. He was reminded that there had already been a conversation about the need to display the name of the person on duty.

[52] Mr Summers did not specifically answer these complaints. It is noted that when he made his written statement on 14 May 2007, about the Anzac Day matter, he confirmed that he was the only certificated manager of the hotel. The company was clearly in breach of s.115 of the Act. That section requires that the duty manager be present on the premises at all times when liquor is being sold to the public. There are occasions when an acting or temporary manager can be appointed but Mr Summers had not seen fit to do so. He seemed to have little understanding of the need to nominate one duty manager at a time. In our view the display of three

names as duty manager in the same location was simply a convenient device to ensure legal coverage.

The Ninth Complaint – Alleged Stalking

[52] Sergeant Laurie referred to a complaint he had received of unwanted attention from Mr Summers. Reference was made to Mr Summers attending the complainant’s church. He produced the complainant’s statement. He said that he had spoken to Mr Summers about the matter and there had been no further contact.

[53] Mr Summers stated that he was surprised by the allegation. He acknowledged that he had invited the complainant out to dinner. He said that he had been attending the same church as the complainant since arriving in Kaikohe in 2006. He confirmed that once he had been spoken to, he had made no further contact.

[54] We only heard direct evidence from Mr Summers. Although hearsay evidence can be admitted under s.109 of the Act, it is clearly preferable to hear from a complainant if at all possible. If an allegation is made of a personal nature, but no action is taken, the impact of such an allegation can result in acute embarrassment for the person whose conduct has been the subject of the original complaint. Bearing in mind that we only heard from Mr Summers, our view of this matter is that there was nothing that Mr Summers did that might impact on the issue of his suitability to hold a licence or a manager’s certificate.

The Tenth Complaint – Allowing Minors on Licensed Premises

[55] On 30 August 2007, a 17-year old was found hiding in the hotel bar after stealing a cellphone from a nearby takeaway bar. Mr Summers stated that he had not seen the minor come in as he had been out the back in the chiller. The Sergeant was concerned that there was no one to check patrons as they entered the premises.

[56] Mr Summers gave evidence that staff had noticed the youngster run straight into the bar and then into the toilets. As soon as the Police entered the member of staff pointed to the toilets and the cell phone was recovered. In those circumstances we do not believe that the licensee has committed the offence of allowing a minor to enter and remain in a supervised area under s.164(1) of the Act.

[57] Senior Sergeant Rogers is in charge of the Kaikohe Police Station. He visited the premises on 1 November 2007 in response to a call. He asked Mr Summers whether he was working as he had seen him drinking earlier. Mr Summers stated that he had consumed a couple of wines but had two managers working.

[58] While in the bar the Senior Sergeant noticed a male whom he knew to be aged

16 drinking from a large bottle of beer. The boy said he was with his auntie. The Senior Sergeant told the minor he should not be drinking, and the young man indicated that Mr Summers had served him. The Senior Sergeant asked Mr Summers to come outside to talk with him but Mr Summers was busy and was quite uncooperative.

[59] Constable N I Sydall was also present. She saw a male whom she believed to be underage. He was sitting at a table in the garden bar with friends and family. She took the male outside. He said he was 16 years of age, being born on 13 June

1991. He said he had walked in with his brother’s workmates, but had not drunk anything.

[60] By this time the Police group had three minors outside including the male who had stolen the cellphone. The second minor said that he was born on 14 June 1991. He said he had purchased the bottle with a $20 note. He said the Mr Summers had asked him if he had identification but when he said he did not, Mr Summers sold the bottle at any event.

[61] Senior Sergeant asked Constable N I Sydall to go inside and bring out the duty manager. The Constable did so but stated that the person had been identified by Mr Summers as the duty manager, and she was uncertain whether that was correct. There were no clear signs about to say who the duty manager was. Constable Sydall spoke with the person who said that she only found out she was the manager when she was asked to come outside to talk with the Police.

[62] Senior Constable Wright stated that on 3 January 2008, two 14-year old girls had been found in the bar area. Mr Summers stated they were related to a member of the staff and had called at the bar to pick up a key. He contended that it was an innocent situation.

[63] Mr Summers said that on 1 November 2007, he had a DJ playing. There were groups gathering outside and he felt there was a potential for trouble. He called the Police. He said he could not remember serving the 16-year old but when he saw him, his impression was that he was over 18. He referred to the fact that the minor had not given evidence so that his appearance could be assessed. He accepted that another minor had been found in the garden bar, but stressed that he had not been sold any liquor.

[64] Mr Summers stated that the fact that groups gathered outside the premises, was one of the reasons he had stopped having DJ’s playing on Wednesday and Thursday nights. Although some of the evidence was of a hearsay nature, it was clear that two minors had been found on the premises. On assessing the evidence it was our view that it was probable that one of the minors had been sold liquor by Mr Summers.

The Eleventh Complaint – Allowing Persons on Licensed Premises outside licensing hours

[65] Following the incident on the evening of 30 August 2007, Sergeant Laurie returned to the premises after 1.00 am. He noted that the bar was closed and the doors were locked. He said that patrons were drinking up in the garden bar. He contended that several patrons continued to drink there well after 1.30 am. He believed that some of them were bringing drinks from their vehicles. The Sergeant took the view that there was no barrier to stop members of the public using the garden bar in this way, as there was almost direct access from the street.

[66] The Sergeant noted that Mr Summers was inside cleaning up. He came to the side door and asked whether there was a problem. The Sergeant told him that patrons were still on the premises creating a nuisance. Mr Summers then went round the people removing drinks and telling them to leave, which they did. The Sergeant was concerned that there was no way of preventing the public from entering and using the premises in this way.

[67] Mr Summers stated that because of concerns about groups of patrons congregating outside the premises after trading had stopped, he ceased having DJ’s playing on a Wednesday and Thursday nights. He also shut the premises at midnight on Fridays to stop migration from another bar. Although the level of patronage had reduced, so had the problems. He disputed the time that he had been asked to remove the patrons from the garden bar, and believed that they were within the half-hour ‘drink-up’ time allowed by the Act. In the absence of specific evidence that times were checked, we were not prepared to make an adverse finding

The Twelfth Complaint – Allowing Direct Access onto Broadway

[68] Mrs T K Dalton referred to awnings on the roadside enabling patrons to drink outside the premises in view of the main street. She stated that on numerous occasions patrons were seen walking across the street with bottles or even handles, and contended that there were no security guards.

[69] On 8 June 2007, Senior Constable Wright also spoke with Mr Summers about the problem of intoxicated patrons walking all around the footpath area and the cars parked in the front of the hotel. He followed up his conversation on 15 November

2007. He discussed with Mr Summers that he had made no attempt to define or limit access to and from the licensed area, and no attempt to try and control the problem with signs. Furthermore, the Senior Constable did not believe it was possible to monitor the area from inside the bar.

[70] Senior Sergeant Rogers attended the hotel on 30 August 2007. He spoke to Mr Summers about people walking in and out of the garden bar with liquor onto the footpath on Broadway, thereby breaching the liquor ban. He subsequently noted three to four patrons walk from the smoking area onto the main street. He noticed that Mr Summers was speaking to the patrons indicating the Police presence, and that he took a bottle off one of the patrons.

[71] Mr Summers was able to show that the garden bar was part of the defined licensed premises, and was used by smokers as well as drinkers. He said that he had been trying to persuade the local Police to enforce the liquor ban area without success. He contended that since he had stopped the DJ entertainment on Wednesday and Thursday nights, and closed an hour earlier on the Friday, the number of incidents had reduced. On the other hand, while he is not breaking any law, by allowing such open access, he is laying himself open to a variety of potential problems many of which can result in liquor abuse. If he is to retain his licences, he needs to be controlling the supply of liquor to the public in a much more focussed way.

The Thirteenth Complaint – The Alco-Link Reports

[72] Senior Constable Wright produced the Alco-Link reports for the period 1

January 2007 to 31 December 2007. There were 30 incidents. Patrons were said to be extremely intoxicated on six occasions, and moderately intoxicated on 20 occasions. Although no attempt was made to analyse the results, the figures are not acceptable for a first year’s operation. The results provide the intelligence that supports the general thrust of the evidence, that the premises are not being tightly managed.

The Authority’s Decision and Reasons

[73] At the completion of the applicant’s evidence, we took the preliminary view that both licences should be cancelled, either by refusing the renewal applications, or as a result of the enforcement applications. It says something for the response made by Mr Summers, that he was able to persuade us to change our collective mind, and our perception of the evidence. Although we have given our findings above, further comment is necessary.

[74] We deal first with the company’s application for the renewal of its on and off- licences. These applications are governed by ss.22 and 45 of the Act. We are required to have regard to the following matters:

(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 (delivery)

of liquor pursuant to the licence:

(d) Any matters dealt with in any report made under section 20 (43) of this Act.

[75] The renewal applications are the first to be dealt with since the business was established, and are therefore the most important. As a matter of law, all new licences are granted for one year. This gives the monitoring agencies (and members of the public), the opportunity to monitor the business. If an applicant shows a lack of commitment to host responsibility, or to the conditions of the licence, then the Authority has the power to refuse to renew the licence, or alter its conditions, with particular attention to the trading hours. If the style of the licence is different to the way it was originally portrayed, then the conditions of the licence may be reviewed. In this way all licence holders have a clear incentive to show not only that they are committed to the welfare and safety of their patrons, but also the object of the Act.

[76] In this case, Mr Summers carries the onus of establishing issues such as his suitability, and why the conditions of the licences should not be varied, and the manner in which the sale and supply of liquor has been conducted. In this case the first year’s report card has been less than impressive. It is accepted that there was little evidence about the sale and delivery of liquor under the off-licence. Under the heading of suitability, Mr Summers was not only the duty manager, but also the company’s alter ego. Although he had previous experience in the industry, he did not seem willing to focus on licensing issues.

[77] For example, Mr Summers must, as a matter of necessity, have the definition of the licensed premises changed to exclude the area currently leased. He needs to address the security and liquor abuse issue of unlimited and public access to the garden bar. He could do a lot more about promoting the availability of food.

[78] Under its on-licence, the company has the following responsibility in relation to the supply of food.

Food must be available for consumption on the premises as follows:

At all times when the premises are authorised to be open for the sale of liquor, food of a range and style similar to that shown on any menu submitted, or a range of snack foods in the nature of pies, sandwiches, filled rolls, pizzas and the like, must be conveniently available for all members and their guests and the availability of those foodstuffs must be notified to them by appropriate notices throughout the premises

[79] It is clear that the company was in breach of the condition when its freezer was being repaired or replaced. It may think that it had an excuse but it could have arranged for food to be available from other sources, or used another freezer space. The company also failed in its duty to promote the supply of food by appropriate notices. In assessing an appropriate sanction, we have taken into account that the company now meets the minimum requirements of its licence.

[80] Section 12 of the Smoke-free Environments Act 1990 provides:

12 Smoking on licensed premises

(1) The licensee of any licensed premises must take all reasonably practicable steps to ensure that no person smokes at any time in a part of the premises that is not an open area.

(2) Subsection (1) does not prevent the licensee of any licensed premises from prohibiting smoking in a part of the premises that is an open area.

(3) No person may smoke at any time in a part of any licensed premises that is not an open area.

[81] The amendment had now been in force for over three years. We know of no other licensees nationally, who continue to have trouble complying with the Act. Mr Summers’ explanations and excuses are simply not good enough. If other licensees can make the effort, then so can he.

[82] As already stated, the company breached s.171 of the Act by allowing members of the public to enter licensed premises to gamble. The company was also in breach of s.172A of the Act. The company (and Mr Summers), failed to ensure that s.115 of the Act was complied with. As was stated in Gary Selwyn Whittle v 490

Q KJD Limited LLA PH 1316/2007:

We are satisfied, after hearing the evidence, that there was a breach of s.172A of the Act. The licensee failed to ensure that s.115 of the Act was complied with. Section 115 is one of the more important sections in the Act. It lays the foundation for placing the entire responsibility for running licensed premises on the shoulders of the holder of a General Manager’s Certificate. Such a person must be present at all times when liquor is sold to the public. Such a person is responsible for compliance with, and enforcement of, the Act as well as the conditions of the licence, and the general conduct of the premises. The position of a manager has been strengthened by the requirement that the person must now be the holder of the Licence Controller Qualification. The monitoring agencies look to managers to be present and to be responsible. We believe that if a manager is not present when liquor is being sold, then consequences should follow."

[83] Two minors were found on licensed premises in breach of s.164 of the Act. One was drinking from a bottle. We found that in all probability, Mr Summers had sold liquor to this minor in breach of s.155 of the Act. As stated above, Mr Summers had no memory of the sale, and the minor’s comments as to how the sale happened, had the ring of truth about them. Mr Summers carries the onus of proving his defence. Section 155(4) of the Act reads as follows:

It is a defence to a charge under subsection (1) or subsection (2) of this section if the defendant proves that the person who sold or supplied the liquor believed on reasonable grounds that the person to whom it was sold or supplied had attained the age of 18 years.

[84] In assessing Mr Summers’ belief it is pertinent to examine what he said and did at the time. He asked for identification so he was clearly suspicious. However, when the minor said he did not have any identification with him, he made the sale at any event. Because he had no recollection of making the sale, we do not accept that Mr Summers believed that the minor was of age, nor do we accept that there were reasonable grounds for such a belief.

[85] In all the circumstances we do not believe that it would be reasonable to refuse to renew the licences. There will however be reduced periods of renewal to give the company a further ‘probationary’ year. This should be regarded as an opportunity for the company to ‘mend fences’ with its relationship with the community and reporting agencies. The company will have at least nine months to show that new systems are in place, and the management is robust enough to ensure that the company operates within the law. The company needs to be able to demonstrate that the lessons from the hearing had been learned, and the recommendations in this decision have been implemented.

[86] The final issue is to determine whether it is desirable to make suspension orders against the company and Mr Summers. We have concluded that the licensed premises were operated in breach of ss.155, 164, 171 and 172A of the Act. We also find that the premises were conducted 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 minors were observed. A lack of suitability has been established in respect of Mr Summers and his company.

Orders

[87] For the reasons we have given we make the following orders.

[a] The on and off-licences issued to Rightside Properties Limited will be renewed for 12 months. The licences will next fall due for renewal on 1

March 2009.

[b] On and off-licences numbers DLA/01/ON/006/2007 and DLA/01/OFF/002/2007, issued to Rightside Properties Limited, are suspended for ten days from 7.00 am on Sunday 22 June 2008 to 7.00 am on Wednesday 2 July 2008.

[c] General Manager’s Certificate number 01/GM/046/2003 issued to Neal

Alan Summers is suspended for five weeks commencing Sunday 22 June

2008.

DATED at WELLINGTON this 14th day of May 2008

Judge E W Unwin

Chairman

Kaikohe Hotel.doc