O'Shaughnessy, re [2010] NZLLA 6 (13 January 2010)

Last Updated: 12 March 2010

Decision No.PH 006/2010

IN THE MATTER of the Sale of Liquor Act 1989

AND

IN THE MATTER of an appeal by BERNARD O’SHAUGHNESSY pursuant to s.137 of the Act against a decision of the Wellington District Licensing Agency granting the renewal of an off-licence in respect of premises situated at 195 Riddiford Street, Newtown, Wellington, known as “Newtown New World”

BEFORE THE LIQUOR LICENSING AUTHORITY

Chairman: District Court Judge E W Unwin
Member: Dr J Horn

HEARING at WELLINGTON on 15 December 2009

APPEARANCES

Mr B T S K O’Shaughnessy – appellant
Mr S R Walker – for Garbak Enterprises Limited – in opposition
Mr M J Kemp and Ms J H Burt – Wellington District Licensing Agency Inspectors – to assist
Sergeant J R Thurston – NZ Police – to assist

RESERVED DECISION OF THE AUTHORITY

Introduction

[1] This is an appeal brought by Bernard O’Shaughnessy against a decision of the Wellington District Licensing Agency. The Agency received an application from Garbak Enterprises Limited (hereafter called “the company”) for the renewal of its off-licence in respect of premises situated in Riddiford Street in Newtown, Wellington. The company trades as a supermarket in the name of “Newtown New World” and is licensed to sell beer, wine and mead from Monday to Sunday between the hours of 7.00 am to 12.00 midnight. The licence fell due for renewal on 28 October 2009. No changes to the conditions of the licence were sought.
[2] There was no opposition to the application from either the Police or the District Licensing Agency Inspector. Public notification produced an objection from Mr O’Shaughnessy. He resides at 320 Mansfield Street in Newtown. His objection contained the following assertions:

“1. New World in Newtown has been a major contributor to the slide into a booze enhanced society in Newtown by the display, encouragement, cut price liquor drink products, and promotion of a “Must have booze attitude to enjoyment”.

2. New World at Newtown does supply liquor to young people aged 18 to 30 at low cost and to all persons of any age to booze and encourages customers by enticing them to purchase immediately booze as they enter the door, rather than focus on buying food for families.
3. New World has shown little regard to support local schools or charitable organisations.
4. Within the Licensing requirements of the Liquor Licensing Act 1989 a Licensee must “have the welfare of the Community” taken into consideration in being a seller of a product. I state that New World Newtown does not comply with this requirement.
5. New World has huge promotions of its liquor products, and the cheapness of that, by regular local and national radio, newspaper, TV advertisements and regular pamphlet letter box drops on a weekly cycle.
6. New World encourages drunkenness, lewdness on the street, and the local bad behaviours by its strength of liquor products in and around the whole of Newtown.
7. New World bulk buys and gains market share by its buying power, and sells cheap to encourages customers to booze, including the “dumping” of alien cheap booze (from Australia) onto Kiwis. Australia has wine ‘lakes’ and therefore dumps it onto New Zealand.
8. New World adds to the Drink Drive problems of New Zealand, the destruction of family and personal relationships.
9. New World has added to the destruction of a great decent society in New Zealand and Newtown by its liquor products.
10. New World Newtown has amazing long opening hours for booze in that persons of all ages can buy this liquor product from Monday to Sunday 7 am to 12 midnight, that’s 119 hours in a week booze is encouraged particularly in its methods of advertising, promotion, cheap sales, and ‘booze = fun = culture = excitement = a way of life.’ The philosophy of New World is to encourage us all to, buy lots of cheap booze, drink lots and quickly, then call again to shop and renew the cycle of destruction.”

[3] The renewal application was considered by the Agency on 22 September 2009. A decision was issued ‘on the papers’. The decision set out the criteria in s.45 of the Act to which the Agency (and this Authority) must have regard when considering the application. It confirmed that in the view of the Agency, Mr O’Shaughnessy did not reside in close proximity to the subject premises, and could not therefore demonstrate a greater interest in the application than the public generally as required by s.42(1) of the Act. The decision stated that the objector appeared to have concerns in principle about the impact of the sale of liquor on the wider community in general, but had not provided any documentation showing that the matters raised were an actual issue at the premises. The Agency concluded that pursuant to s.106(2)(b) of the Act the objection was based on grounds outside the scope of the Act. The application was accordingly granted without a hearing.
[4] Mr O’Shaughnessy exercised his right to appeal against the decision. He filed a five page document with the Authority. He argued that he lived about seven and a half minutes walk away from the business and therefore had a greater interest in the application than the public generally. He also made a number of allegations about the company’s owner, questioning the company’s suitability.
[5] The appeal was received on 5 October last and was followed by further correspondence from Mr O’Shaughnessy by email containing other material and allegations. The appeal was placed on hold pending receipt of the filing fee. Prior to the hearing Mr O’Shaughnessy gave notice of his intention to speak Maori or as he described it, using Te Reo only. He alleged that it was his legal right to do so. He was advised that he had no such right. In accordance with the Act the appeal was conducted by way of a rehearing.

The Rehearing

[6] We were satisfied that Mr O’Shaughnessy has a greater interest in the application than the public generally. This conclusion is not based on his membership of such organisations as ‘Tin Do’ and/or ‘BAB’ or the fact that he was a long-term regular visitor to the supermarket. Our view is based on his proximity to the business. He lives no more than 500 metres from “Newtown New World”.
[7] In a recent decision Liquor World Limited LLA PH 1189/2009 we attempted to set out a number of principles and guidelines that apply when applications are made for an off-licence. This was because of general public misconceptions and/or misunderstandings about the licensing of new liquor outlets. The first principle and guideline is:

“Only people who have a greater interest in the application than the public generally can object. They can only object in relation to one or more of the criteria set out above. How people establish an interest in the application that is greater than any other member of the public, is a matter of judgement. In this case the Inspector has suggested a circle with a radius of one kilometre within which an objector must reside or have a business that could be affected. We think that although the proposal is generous, it is a fair and realistic suggestion (see s.32(1) and (3) of the Act).”

[8] We also believe that Mr O’Shaughnessy’s objection did address one or more of the criteria set out in s.45 of the Act. For example, paragraph 10 of his objection set out above, clearly refers to the current trading hours and the company’s ability to sell liquor for 119 hours each week. We accept that the issue of suitability was only raised in an oblique manner but that issue was developed in much greater detail during the re-hearing.
[9] At the commencement of the hearing, Mr O’Shaughnessy repeated his assertion that he intended to speak Maori and that he had the right to do so. The Maori Language Act 1987 confers the right to speak Maori in certain legal proceedings. The actual wording reads:

4. In any legal proceedings, the following persons may speak Maori, whether or not they are able to understand or communicate in English or any other language:
   • (a) Any member of the court, tribunal, or other body before which the proceedings are being conducted:

• (b) Any party or witness:
• (c) Any counsel:
• (d) Any other person with leave of the presiding officer.

[10] This issue is whether an appeal to the Liquor Licensing Authority falls within the definition of ‘legal proceedings’. These are defined by s.2 of the Maori Language Act as follows:

Legal proceedings means –

(a) Proceedings before any court or tribunal named in the first schedule to this Act; and
(b) Proceedings before any Coroner; and

(c) Proceedings before any tribunal or other body that, by or pursuant to any enactment, has the powers, or some of the powers, of a Commission of Inquiry under the Commissions of Inquiry Act 1908 and is required to report upon any matter of particular interest to the Maori people or to any tribe or group of Maori people. (Emphasis ours).

[11] It was common ground that the Liquor Licensing Authority is not named in Schedule 1 to that Act. There are some tribunals that are subject to the Maori Language Act, including the Tenancy Tribunal and the Disputes Tribunal, but not this Authority. It is accepted that the Authority is a Commission of Inquiry pursuant to s.110(1) of the Sale of Liquor Act 1989. What Mr O’Shaughnessy could or would not accept was that the Authority is not required to report on any matter of particular interest to the Maori people. It is required to submit an annual report to the Minister but the subject of that report is limited to the Authority’s proceedings and operations during the year, the workings of the Act, and the desirability or otherwise of amending it. It follows that Mr O’Shaughnessy did not have the right to speak Maori as he asserted.
[12] Mr S R Walker appeared on the company’s behalf. He stressed that there had been no issues about the manner in which the company had conducted the sale and delivery of liquor pursuant to the licence. He contended that there had been no breaches of the Act in the last three years and he noted that neither the Police nor the District Licensing Agency had opposed the renewal.
[13] Mr P W Gillman is the company’s Management Support Officer and Risk Manager. He gave a very supportive reference as to the character and reputation of Mr Gary Baker, claiming that he was more than suitable to direct a company that held an off-licence. He confirmed that the company had been totally compliant with internal age compliance checks over the past three years. Furthermore he contended that no sales of liquor could be made otherwise than after the supervisor’s key card had been swiped. He concluded:

“Mr Baker had brought his views to Newtown New World in ensuring his endeavours provide Newtown New World to be, and remain, a good ‘corporate and community citizen’.”

[14] Although Mr Gillman is the company’s Risk Manager he was unable to say how many trespass notices had been issued by the company. However, he stressed that there was a culture of discipline and standards and that Mr Baker was a firm no-nonsense person particularly when it came to dealing with shoplifters. When asked why the liquor was placed at the store’s entrance, Mr Gillman appeared to indicate that this was caused by competition from other supermarkets. Later he contended that there was a problem with space. Both explanations were inherently implausible.
[15] Mr O’Shaughnessy had approximately 81 pages of submissions and a large number of exhibits. By virtue of s.42(3) of the Act he is restricted in his objection to the criteria set out in s.45 of the Act. Accordingly we have attempted to summarise his objection under the headings of suitability, and the conditions of the licence (in particular, trading hours). Where Mr O’Shaughnessy strayed from the criteria, his submissions have not formed part of the summary. In particular we have ignored two Australian studies which had been sourced by Dr Paul Quigley and which arrived the day after the hearing.
[16] Mr O’Shaughnessy submitted that as an alternative to declining the renewal, we should impose a number of conditions on the licence. These suggestions included a condition restricting the display of liquor to a designated site, or behind a wall, or at the back of the shop. He submitted that there be a condition that a staff supervisor be required to be in attendance in the designated area. In addition he suggested that the trading hours be reduced to 1.00 pm to 7.00 pm Tuesday to Saturday.
[17] On the issue of suitability, Mr O’Shaughnessy made a number of unsubstantiated comments about the company’s sole director (Mr Baker), and Mr P W Gillman, the company’s management support officer and risk manager. There were claims of a large number of trespass orders, assaults on shoppers, and sales to minors. Mr O’Shaughnessy gave four illustrations of situations where unidentified people were alleged to have been assaulted. Given the lack of detail it was quite impossible to state whether his claims had any merit.
[18] However, Mr O’Shaughnessy’s main concern was the large display of liquor surrounded by advertisements at the entranceway to the store. He described it as seven shelves high and 10 metres long. Nearby is another equally large display of beer. Mr O’Shaughnessy complained that the liquor was being sold below cost. He claimed that the liquor at the front entrance to the store had been moved from an area where it was supposed to be contained.

The Authority’s Decision and Reasons

[19] When considering a renewal application for an off-licence, the criteria to which we must have regard are contained in s.45 of the Act as follows:

[1] The suitability of the licensee:

[2] The conditions attaching to the licence:

[3] The manner in which the licensee has conducted the sale and delivery of liquor pursuant to the licence:

[4] Any matters dealt with in any report made under section 43 of this Act.

[20] As we have already indicated, the two main issues relate to the company’s suitability and whether the conditions of the licence (hours of operation) should remain unchanged. The company carries the onus of establishing its suitability to continue to hold the licence. The issue of suitability is not established without looking at the type of business being conducted and the manner in which liquor has been sold over the past three years. In this case there have been no reported breaches of the Act and there were no adverse reports from the District Licensing Agency Inspector or the Police.
[21] Mr O’Shaughnessy raised a number of issues about treatment of customers but they were general rather than specific. In The Narrows Landing Limited LLA PH 479/2003, we made the following comments:

“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.”

[22] In our view such generalised comments lacked sufficient detail to overcome the threshold of factual information that would have been necessary for the company to explain itself. However, Mr O’Shaughnessy raised a number of interesting points about the way the company marketed liquor to the public. In particular he referred to the company’s habit of placing large volumes of liquor at the entrance to the store surrounded by advertising and emphasising the low cost of the liquor. After all, the business is a supermarket and not a bottle store. It is an interesting question to ask why liquor is given such prominence given the company’s claim that it is a ‘good corporate and community citizen’.
[23] Mr O’Shaughnessy seemed to believe that the company was bound to have its liquor in a designated area. This is not so. Pursuant to the Act designations may only be imposed that restrict entry. All or part of the premises may be designated as restricted or supervised. For common sense reasons supermarkets are not designated. That is because their primary business is not the sale of liquor, so members of the public including persons under the age of 18 years have unrestricted entry to the premises.
[24] Consequently the company can technically display liquor all over the store. According to the evidence it has started to do so by displaying thousands of bottles of liquor where they can best dominate the view of members of the public (including young people) as they enter the supermarket. But in doing so the company hardly qualifies for its own self-description of a ‘good corporate and community citizen’.
[25] There were other marketing issues raised at the hearing such as the advertising of liquor on the windows of the supermarket, the sale of beer in single bottles, the ability to sell liquor up to midnight and from 7.00 am. Given the company’s emphasis on the sale of liquor it is pertinent to ask the question whether this business is a bottle store that also sells groceries?
[26] We gained the impression from Mr Gillman that these questions had not really been considered by the company. He stated that the company was well aware that it was selling a legal drug and that there were certain rules in place in particular about selling to minors and intoxicated persons. Furthermore the company is governed by the national undertaking not to loss-lead liquor as part of its marketing strategy.
[27] In the recent Court of Appeal decision in My Noodle Limited and ors v Queenstown-Lakes District Council and anor [2009] NZCA 564, the Court made these comments:

“In our view, the Authority is not required to be sure that particular conditions will reduce liquor abuse. It is entitled to apply the equivalent of the precautionary principle in environmental law. If there is a possibility of meeting the statutory objective (as the Authority found there was in this case), then it is entitled to test whether that policy is a reality. In this case, it clearly intended to test its hypothesis and keep the matter under review.”

[28] There is a growing body of research to suggest a significant and positive relationship between the retail availability of alcohol with increased alcohol consumption and alcohol-related harm. Furthermore it is clear that advertising of alcohol plays a role in an underage person’s drinking decisions. Regrettably the Act prevents us from imposing conditions of the type proposed by Mr O’Shaughnessy. Furthermore his suggested trading hours were in our view unreasonable. On the other hand given the number of outlets available to members of the public, we question whether the ability to sell liquor from 7.00 am to midnight might not lead to liquor abuse issues. We think that the trading hours should be looked at by the company in its efforts to maintain its corporate citizenship tag.
[29] In summary, given current concerns about the impact of liquor abuse on our communities we wonder whether the time has not come for some supermarkets to consider marketing liquor more conservatively and in keeping with their status as a supermarket. We accept that there many supermarkets that do not aggressively display and market liquor in the way that was portrayed in this case. They have accepted that they are primarily a supermarket given the privilege of being able to sell liquor as an adjunct to their core business.
[30] In this case Mr O'Shaughnessy has failed to reach the threshold that is required to undermine the company's claim that it is a suitable entity to retain its off-licence. However, he did raise some interesting questions and issues about the some of the company’s practices. The company failed to respond in a convincing way that it had given due consideration to the Act’s objective. Accordingly we have decided that the company will have its licence renewed for a reduced period.
[31] At the next renewal the company will be asked as a ‘good corporate and community citizen’ to produce a business plan to address the following issues: the sale of beer in single bottles, the hours of sale, the display of liquor in specific parts of the store, and the advertising of liquor within and outside the store. We accept that the primary concern in this case is where the liquor is currently displayed. The company may of course adopt any new strategies well before the next renewal date.
[32] In making this decision we have also taken into account the provisions of s.4 of the Act as follows:

The object of this Act is to establish a reasonable system of control over the sale and supply of liquor to the public with the aim of contributing to the reduction of liquor abuse as far as that can be achieved by legislative means.

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 the Act.

[33] For the reasons we have attempted to articulate the decision of the Wellington District Licensing Agency is modified. The off-licence issued to Garbak Enterprises Limited is renewed for 18 months to 28 April 2011.

DATED at WELLINGTON this 13TH day of January 2010

B M Holmes
Deputy Secretary

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