Court of Appeal (WA)|2001-07-18|Before: Mr P, Templeman J

Belel Pty Ltd & Ors v Baxter [2001] WASCA 225 (18 July 2001)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

CITATION : BELEL PTY LTD & ORS -v- BAXTER [2001] WASCA 225

Practice and procedure - Appeal - Appeals against conviction imposed by Magistrate for contraventions of the Liquor Licensing Act 1988 (WA) - Corporate licensee- Contravention of liquor licence by agent of licensee - Whether a corporate licensee is deemed to have committed an offence committed by a natural person who is an employee or agent - Liquor Licensing Act 1988 (WA), s 165

Whether employee liable for offence deemed to have been committed by agent - Whether defence that sufficient direction or supervision had been given was open on the evidence - Liquor Licensing Act 1988 (WA), s 164, s 101

Liquor Licensing Act 1988 (WA), s 95, s 96, s 101, s 110, s 164, s 165

Anthony Hayes Douglas-Brown v Commissioner of Police (1995) 13 WAR 441

Australasian Films Ltd [1921] HCA 11; [1921] 29 CLR 195

Bropho v Western Australia [1990] HCA 24; (1991) 171 CLR 1

Cervantes Pty Ltd v State Energy Commission of Western Australia (1991) 5 WAR 355

Deatons Pty Ltd v Flew [1949] HCA 60; (1949) 79 CLR 370

Highfield v Alfon Pty Ltd [2000] WASCA 174

Holden v Sainken, unreported; SCt of WA; Library No 970700; 12 December 1997

Jackson v Dyball (1993) 74 A Crim R 10

Kelly v Kjellgren (1966) WAR 149

Leonnard's Carrying Co Ltd v Asiatic Petroleum Co Ltd [1915] AC 705

Mathews v Foggitt Jones Ltd [1926] HCA 13; (1925) 37 CLR 455

Milne v Thirsty Point Pty Ltd [1999] WASCA 100

Mousell Brothers Ltd v London and North-Western Railway Co [1917] 2 KB 836

O'Dea v Glendenning, unreported; SCt of WA; Library No 930599; 26 June 1992

Tesco Supermarkets Ltd v Nattrass [1971] UKHL 1; (1972) AC 153

Thompson v His Honour Judge Byrne & Ors [1999] HCA 16; (1999) 73 ALJR 642

Tiger Nominees Pty Ltd v State Pollution Control Commission (1992) 58 A Crim R 428

Tomazin v Ward, unreported; FCt SCt of WA; Library No 970023; 6 February 1997

Trade Practice Commission v Gillette Co (No 2) 118 ALR 280

1 TEMPLEMAN J: This is an appeal by Belel Pty Ltd, Mr Brian Mark Brennan and Mr Russell Barry Parnham, against convictions imposed in a Court of Petty Sessions for contraventions of the Liquor Licensing Act (1988). The first appellant, Belel Pty Ltd, is the licensee of the Bel Eyre Tavern in Belmont. Mr Brennan, the second appellant, is the approved manager and Mr Parnham, on the day in question at least, was employed by Belel as a bar manager or supervisor.

2 The day in question was 27 June 2000 and the charges arose from the fact, as found by the learned Magistrate, that a barmaid, whose name was Ms Cherie Ann Wilson, who was working at the tavern on that occasion acted in a lewd manner. Ms Wilson's conduct constituted a contravention of the licence of the premises. Relevantly the licence contained entertainment conditions in the following terms:

"The licensee or manager or an employee or agent of the licensee or manager shall not -

take part in, undertake or perform any activity or entertainment on the licensed premises in a lewd or indecent manner."

3 Ms Wilson was not an employee of the first appellant, Belel. She was an agent in the sense that she was employed by an organisation which supplied barmaids or bar staff on a subcontract basis.

4 The charges were amended at trial without objection. The charge against Belel was that being the licensee of the premises known as the Bel Eyre Tavern, it committed an offence contrary to s 110(1)(aa) of the Liquor Licensing Act by virtue of Ms Wilson having committed an offence contrary to that provision, for which Belel would have been liable had it been committed by Belel, namely, on 27 June 2000 Ms Wilson, being an agent of the licensee, contravened the conditions to which the licence is subject in that she acted in a lewd manner.

5 The charge against Mr Brennan was in similar terms. It was put on the basis that he was the licensee and that Ms Wilson had committed an offence contrary to s 110(1)(aa) for which Mr Brennan would have been liable had it been committed by him. The charge against Mr Parnham was again in similar terms, except that he was described as a person permitted by the licensee to conduct, supervise or manage the business carried on under the licence.

6 The learned Magistrate made findings of fact which included the following:

"Cherie Ann Wilson on 27 June 2000 was an agent of the licensee to serve and sell liquor at the Bel Eyre Tavern in Belmont.

Whilst serving and selling liquor to patrons in a bar at the tavern, on at least three occasions she exposed her genital area to encourage patrons to give her money by throwing it into her shorts, by pulling down a G-string, and was acting in a lewd manner.

She did not receive any instructions from the third defendant as to mode of dressing or undressing. The third defendant was appointed by the second defendant to supervise and manage the sale of alcohol on the premises and was acting as the supervisor and manager of the premises when Wilson exposed her genital area for gain.

It was not in dispute that the licensee was the first defendant and the second defendant was the approved manager when Wilson exposed her genital area.

In my opinion the condition not to "undertake or perform any activity in a lewd manner" was a restriction relating to the sale and supply (of) liquor in the sense that the licence permitted the licensee to sell and supply liquor only in circumstances where the licensee's employees did not act in a lewd manner.

The only supervision the third defendant performed was in regard to the supply and sale of alcohol. His supervision in the manner of dress and behaviour of Wilson was perfunctory."

7 Although the learned Magistrate did not say so expressly, those findings of fact necessarily involve a finding that Ms Wilson committed an offence contrary to s 110 of the Act. That section provides:

"(1) Where the licensee of licensed premises, or a person employed or engaged to perform any function in the business conducted under the licence or at the licensed premises -

...

(aa) acts in any way that contravenes this Act or any term or condition of the licence or permit;

that person commits an offence.

8 The learned Magistrate convicted Belel by applying s 165 of the Act. Section 165 provides:

"(1) Where in contravention of this Act, an employee or agent of the licensee, or a person acting, or purporting to act, on behalf of the licensee, commits an offence for which the licensee would have been liable had it been committed by the licensee on the premises to which a licence or permit relates, the licensee shall be deemed also to have committed an offence and is liable to the same penalty as is prescribed for the principal offence."

9 The section goes on to say that the licensee may be proceeded against and convicted, notwithstanding that the agent has not been proceeded against or convicted.

10 The learned Magistrate in his reasons referred to a submission made by counsel for the defendants that s 165 was not a section which facilitated proof but was a substantive offence provision. His Worship said:

"In my view, that is not so. Section 165(1) is a deeming provision which purports to make a licensee liable in circumstances where his employee or agent commits an offence: see O'Dea v Glendinning, unreported; SCt of WA (Ng C); Library No 930599; 26 June 1992 at 17. Subsection (2) makes it clear that conviction of the employee or agent is not necessary before the licensee can be held liable and s 165(3) excludes a defence based upon the licensee's lack of knowledge. In my view, that subsection does not establish that s 165(1) is an offence creating provision, but rather s 165(1) is an offence facilitating provision which has the effect of deeming the licensee to have committed an offence in circumstances where the employee or agent has in fact done so. Because the offence is artificially created in that way, a licensee is liable to the same penalty as the employee or agent would be liable to upon conviction."

11 In referring, as his Worship did, to the offence being created artificially, he was adopting a passage in the judgment in Holden v Sainken, unreported; SCt of WA; Library No 970700; 12 December 1997, where Scott J reached that conclusion.

12 It is submitted on behalf of Belel that although a licensee may be deemed to have committed an offence which an employee or agent has committed, a corporate licensee should not be deemed to have committed an offence which could not have been committed by a corporation. In other words, it is submitted, s 165 would only impose liability on a licensee who could himself (or perhaps itself in limited circumstances) have committed the offence committed by the employee or agent.

13 That would have the result that where an offence was committed by an employee or an agent, the licensee may or may or may not be liable for that offence. It would not be liable if, as in this case it is submitted, the act complained of was an act of lewdness which could not be committed by a corporation. On the other hand, if the licensee was a natural person then the licensee could be liable.

14 It is conceded by counsel for Belel that such a construction might give rise to some injustice. However, it is submitted, such injustice could be avoided by resort to s 95 and s 96 of the Act which empower the Court to take disciplinary action against a licensee if the business is not properly conducted in accordance with the licence. Indeed it is said that the disciplinary powers available to the Court under s 96 are wider than the penalties which may be imposed on a licensee pursuant to s 165. However, no action can be taken against a licensee pursuant to s 95, unless the natural person who has contravened a licence or committed an offence has been convicted of that offence. That is not of course a requirement of s 165.

15 I do not accept Belel's primary submission. It seems to me, with respect, that s 165 is perfectly clear and unambiguous in its terms. It deems a licensee to have committed an offence committed by a natural person who is an employee or agent. It seems to me that it matters not whether the licensee was physically capable of committing the offence because, as Scott J said in Holden v Sainken, in the terms adopted by the learned Magistrate, the offence is created artificially. That is the effect of a deeming provision. Something is deemed to have happened which may well be an impossibility in reality.

16 It seems to me that by applying that construction to licensees, corporate or natural, an entirely fair result is reached which promotes the object of the legislation, namely to regulate proceedings in licensed premises.

17 That being so, I consider that the learned Magistrate's reasoning was perfectly correct. Ms Wilson, as Belel's agent, committed an offence because she breached a condition of the licence. That was an offence for which Belel would have been liable if it had committed the offence itself. It follows that Belel was deemed to have committed the offence and was rightly convicted of it.

18 I turn then to the appeals by the second and third appellants. Those appeals are based on an amended ground, leave being given to amend at the commencement of the hearing today. The amended ground is in the following terms:

"The learned Magistrate erred in law in finding that each of the second and third appellants were liable as though he was the licensee of the licensed premises pursuant to s 101 of the Act because -

(1) no act or omission on the part of the licensee was an element of the offence committed by the agent in contravention of section 110(1)(aa) of the Act and -

(2) no requirement was made of the licensee."

19 There is some difficulty, I say with respect to the learned Magistrate, in determining precisely how he reached his conclusion that the second and third appellants should be convicted. There is no doubt that he did convict them but his reasons appear to stop at the point at which he held Belel liable.

20 From my discussions with counsel it appears that the learned Magistrate applied s 101, that being an inference drawn from the fact that the learned Magistrate set it out in full in his reasons, in a context which suggests that that was the provision on which he relied. Section 101 is in the following terms:

(a) a requirement is made of a licensee; or

(b) an element of an offence is an act or omission on the part of a licensee,

a person appointed as manager, or permitted by the licensee to conduct, supervise or manage the business carried on under the licence on any premises is responsible as though that person were also a licensee of those premises and is liable accordingly, and a complaint may be made out against the person for the offence.

(2) A person who is not a manager of licensed premises but is permitted by a licensee to conduct, supervise or manage the business carried on under the licence, shall, for the purposes of any prosecution for an offence under this Act arising out of the conduct of the business, be deemed to be, and is liable as though that person were, the manager of the premises concerned."

21 The learned Magistrate then went on in his reasons to set out s 110 to which I have referred above. He also set out certain parts of s 164 which it appears he considered to be applicable for reasons to which I will refer in a moment.

22 The parts of s 164 set out by the Magistrate were as follows:

(1) Where an offence under this Act is found to have been committed by a body corporate, then -

(i) to have been committed with the consent or connivance of; or

(ii) to be attributable to any failure to take all reasonable steps to secure compliance by the body corporate with this Act on the part of,

any officer or other person concerned in the management of the body corporate, or any person purporting to act in any such capacity, that person as well as the body corporate shall be deemed to have committed an offence; and

(b) unless it is proved that -

(i) such direction had been given; and

(ii) such supervision had been exercised or caused to be exercised,

as were reasonably necessary to ensure that an offence against this Act was not committed, the manager of any premises in respect of which the offence was committed shall also be deemed to have committed an offence,

and each shall be liable to the same penalty as is prescribed for the principal offence."

23 Pausing there, that provision appears to impose a liability under par (a) on an officer or any other person concerned in the management of the body corporate and under par (b) on the manager of the premises unless it is proved that a direction has been given or supervision has been exercised as were reasonably necessary to ensure that the offence was not committed.

24 That, I think, does not require the manager to prove that he or she has given that direction or exercised that supervision. It only requires proof that somebody has given such direction or supervision as reasonably necessary.

25 As I have said, it is not clear entirely how the learned Magistrate reached his conclusion in convicting the second and third appellants, but it seems to me that there are two possible routes by which the learned Magistrate could have reached that conclusion. I turn to s 101(1) again to explain that.

26 Paraphrasing s 101(1), it provides that where an element of an offence is an act or omission on the part of a licensee, then the manager is responsible as though that person, that is, the manager, were also a licensee and is liable accordingly: "and a complaint may be made out against that person for the offence". The offence last referred to is, I think, the offence which is the act or omission on the part of the licensee.

27 In the present case the only relevant act was the act of Ms Wilson. That is made an offence on the part of the licensee by virtue of s 165. That being so, it seems to me the manager (and this would apply both the second and third respondents) is liable accordingly and a complaint may be made out against each of them, as indeed it was. It seems to me on that narrow ground it was open to the Magistrate to have convicted the two respondents.

28 The appellants argue, and this is the substance of the amended ground of appeal, that no act or omission on the part of the licensee was an element of the offence committed by Ms Wilson in contravention of s 110(1)(aa). That is certainly so. However, there does not have to be any act or omission on the part of the licensee in the contravention of the Act on the part of Ms Wilson. The reverse is the case. It is her contravention which is deemed to be an act or omission on the part of the licensee and for which the licensee is liable.

29 On that construction of s 101 it is arguable that the mere fact that the manager is made liable and that a case may be "made out" against him will result in a conviction. However, if that were the case, then the provisions of s 164 to which I have referred and to which the learned Magistrate referred may be superfluous if the offence has been committed by a body corporate, bearing in mind that s 164 applies only where an offence has been committed by a body corporate.

30 It seems to me that a better view of the approach to be taken against the second and third respondents is that although a case may have been made out against them under s 101 it was nevertheless open to them to defend the charge by proving that such direction had been given or such supervision had been exercised or caused to be exercised as was reasonably necessary to ensure that the offence was not committed.

31 That, I think, is the way the learned Magistrate approached the matter: and I say that for two reasons. One is that when the appellants were first charged, the charges alleged a contravention of the conditions of the licence by permitting a person engaged as a bar person to be immodestly dressed, etcetera. Those charges were later amended in the way which I have described.

32 The evidence given during the hearing included evidence of direction or supervision by the second and third respondents. In particular the second respondent gave evidence about the way he had instructed the operations manager, Ms Anita Lawton about the standard of decorum - I am paraphrasing his evidence - expected of bar staff. He gave evidence that he had asked Ms Lawton to pass that on to the staff.

33 The second respondent said also that on occasions he spoke directly to staff telling them of their obligations; and that he specifically had conversations with Ms Lawton or staff in relation to skimpies. There was also evidence by Ms Lawton which confirmed that she had received those instructions. She said she had received them many times, that the skimpies were not allowed to take off their clothing or flash, as she put it.

34 The third appellant also gave evidence about instruction which he had given.

35 The learned Magistrate referred to some of these matters in his reasons. He referred in particular, as I said in setting out his findings of fact, to the supervision by the third respondent, which he said was in regard to the supply and sale of alcohol: the supervision in the manner of dress and behaviour of Ms Wilson being perfunctory.

36 For those two reasons, namely, the reference to s 164 and to the evidence about the supervision, I conclude that the learned Magistrate may not have convicted the second and third appellants simply because they were deemed liable under s 101, but that he considered whether they should avoid liability by taking advantage of the opportunity offered them by s 164(1)(b) to prove that they had given appropriate directions or exercised appropriate supervision.

37 It is urged on me by counsel for the second and third appellants that the learned Magistrate did not deal fully with the evidence of the second and third appellants in relation to this matter and that I should, having reviewed that evidence, come to the conclusion that adequate supervision and direction was given.

38 I am not persuaded that that is the case because as is conceded by counsel (and in my view quite rightly conceded) there was no evidence at all from Ms Wilson that she had been given direction or supervision about what she could or could not do in the way of dress or decorum. In fact Ms Wilson's evidence was that she had not been told what she could or could not do and that she was instructed only in the matter of serving drinks.

39 It being open to the learned Magistrate to accept that evidence, I do not think it could be said that direction was given or supervision was exercised which was reasonably necessary to ensure that an offence was not committed when the very person who has committed the offence was not given any relevant direction or supervision.

40 That being so, it seems to me that whichever route the learned Magistrate took in convicting the second and third appellants, he reached the right conclusion. The result is that in relation to all appellants the appeals should be dismissed.

Licensing Act 1988(WA)

Belel Pty Ltd & Ors v Baxter [2001] WASCA 225

At a glance

Court

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Judgment (84 paragraphs)

Belel Pty Ltd & Ors v Baxter [2001] WASCA 225 (18 July 2001)

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Legislation Cited (1)

Cases Cited (7)