DPR v Independent Liquor and Gaming Authority [2018] NSWCATAD 251 | Case summary

Reasoning and Decision

Neither party was able to identify any authority directly on the point raised in this application. The task of the Tribunal is to construe cl7 of the GLA Regulation by reference to accepted principles of statutory interpretation. The Tribunal must consider the ordinary and grammatical sense of the words used in cl 7, having regard to their context and legislative purpose: CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; Wilson v State Rail Authority of New South Wales (2010) 78 NSWLR 704, [2010] NSWCA 198 at [12]-[14].
The regulatory scheme of the licensing provisions of the Liquor Act was considered by the Appeal Panel in Independent Liquor and Gaming Authority v Auld [2018] NSWCATAP 184 at [28]-[80]. Schmidt J also provided an overview of the regulatory scheme in Rogers v Independent Liquor and Gaming Authority (No 2) [2018] NSWSC 1177 at [38]-[61]. Both commenced with recognition of the objects of the Liquor Act as specified in s 3. In Auld the Appeal Panel noted: 30. The object of the Liquor Act set out in s 3(1)(a) emphasises that the regulation and control of the supply and consumption of liquor is to be "consistent with the expectations, needs and aspirations of the community" (s 3(1)(a)). The object in s 3(1)(b) indicates that the regulatory system established by the Liquor Act should be "flexible and practical … with minimal formality and technicality". In construing the Liquor Act, a construction that would promote these objects is to be preferred to one that does not - s 33 of the Interpretation Act 1987 (NSW). 31. In addition, under s 3(2), each person exercising functions under the Liquor Act is required to have due regard to: (1) the need to minimise harm associated with the misuse and abuse of liquor; (2) the need to encourage responsible attitudes and practices towards the promotion, sale and supply of liquor, among other things; and (3) the need to ensure that the sale, supply and consumption of liquor contributes to and does not detract from the amenity of community life.
Relevantly for the present application, there are seven types of licences that may be granted under the Liquor Act, which authorise the licensee to sell or supply liquor in accordance with that Act and the conditions of the licence (s10(1), (2)): (a) hotel licence, (b) club licence, (b1) small bar licence, (c) on-premises licence, (d) packaged liquor licence, (e) producer/wholesaler licence, (f) limited licence.
In addition to the different types of licences, the Liquor Act establishes various authorisations that may be approved, for example an extended trading authorisation authorising consumption on licensed premises during specified periods (s 49(2)). Section 51 provides the general provisions for five such licence-related authorisations, including the form of any application.
Division 1 of Part 4 of the Liquor Act deals with licence applications and the granting of licences. Division 3 of Part 4 deals with licence removals and transfers. While the terms "removal" and "transfer" are not defined, s59(1) makes it clear that removal is a process whereby a licence is removed to premises other than those specified in the licence, whereas s 60(1) relates to the transfer of a licence to a person other than the licensee. There are additional provisions for transfer in particular circumstances including on dispossession of a licensee (s 61 - at issue in Sidgreaves v Chief Commission of State Revenue [2018] NSWCATAP 20) or the death of a licensee (ss 63, 64), which are not relevant in the present circumstances.
That the processes of removal and transfer are distinct is confirmed by s59(3), which states that an application to remove a licence to other premises "is to be dealt with and determined by the Authority as if it were an application for the granting of a licence in respect of those other premises", when contrasted with s 60(5) which states that an application for approval to transfer "is to be dealt with and determined by the Authority as if it were an application for the granting of a licence to the other person and the other person was the applicant for the licence". The former focusses on the premises, while the latter focusses on the suitability of the person to whom the licence is proposed to be transferred.
Clause 7 of the GLA Regulation identifies specific licence and authorisation decisions that might be made by ILGA as being administratively reviewable decisions. For example, cl 7(a) permits review of decisions in relation to the granting or removal of only four of the seven types of licences referred to in s 10, and cl 7(b) permits review of decisions in relation to an application for only one of the types of authorisation which ILGA could consider.
The proposition that only limited rights of merits review were intended to be created under s13A of the GLA Act is supported by the Second Reading speech on the introduction of the Gaming and Liquor Administration Amendment Bill 2015 (Legislative Assembly Hansard, 27 October 2015), in which the Minister stated (emphasis added): The current regulatory model does not include a merit review mechanism of decisions made by the Independent Liquor and Gaming Authority. The absence of a review mechanism particularly in relation to contentious matters that have a strong public interest, such as a new hotel licence, has been problematic for both business operators and local communities. For business operators there has been no low-cost non-technical recourse available for review of a decision to refuse an application that has involved significant investment over a period of time. For local communities there has been no low-cost, non-technical recourse available for residents and others opposed to a new liquor licence being approved in their neighbourhood. In fact, the problems that led to the 2008 creation of the Independent Liquor and Gaming Authority have been replicated in the current system; that is, the pre-2008 system was legalistic, adversarial, complex and slow. The bill provides for licensing decisions to be reviewed in certain circumstances. For decisions made by the Independent Liquor and Gaming Authority, a review will be available from the NSW Civil and Administrative Tribunal [NCAT] in relation to contentious liquor and gaming applications, such as the grant of a new hotel or packaged liquor licence. The types of applications determined by the Independent Liquor and Gaming Authority that can be reviewed by NCAT will be prescribed by regulation prior to the commencement of the bill. Those seeking a review of a decision made by the authority will be limited to the applicant and those who made a submission and who were required to be provided with notification of the application.
The reference to "contentious liquor and gaming applications" is consistent with the specification in cl 7(a) of "granting" and "removal" of licences, that is, applications for approval of a new or altered licence in a location or for premises not previously licensed.
Clause 7(a) in terms refers only to "granting" and "removal", and does not refer to "transfer". In support of the submission that that means that a refusal of a transfer application is excluded from merits review, the respondent relies on Racing NSW v Lewin [2018] NSWCA 93, in which the Court of Appeal considered whether a decision by Racing NSW to refuse to issue a licence, on a renewal application, could be the subject of appeal to the Racing Appeals Tribunal under cl 5(2) of the Racing Appeals Tribunal Regulation 2015. That regulation stated: (2) An appeal may be made to the Tribunal under section 15(1)(d) only in respect of a decision: (a) to disqualify or warn off a person, or (b) to suspend any licence, right or privilege granted under the rules, or (c) to revoke the licence of any person under the rules, or (d) to impose on any person a fine of $200 or more, or (e) to disqualify a horse, if the disqualification is made in conjunction with the imposition of a penalty on the appellant or any other person.
The question was whether the refusal could be characterised as a decision to "revoke the licence" which had been issued to Mr Lewin. Basten JA, with whom Bathurst CJ and Macfarlan JA agreed, held that it could not be so characterised: 33 In any event, the statutory language is clear: s 14(2)(b) of the Thoroughbred Racing Act confers on the applicant powers to licence, refuse to licence, cancel a licence and suspend a licence of a bookmaker. Clause 5 of the Regulation expressly refers only to revocation and suspension of a licence; it does not refer to refusal to license. (Nor, indeed, does it provide a right of appeal in the case of the conferral of a licence, but subject to conditions.) It is contrary to the ordinary meaning of the term "revoke" to expand it to encompass a refusal to licence, whether by way of initial licence or renewal.
There was no submission in this application that the word "transfer" should be read into cl 7(a). Rather, the applicant seeks to distinguish Lewin, submitting that in the legislative context of the Liquor Act and cl 7, the "granting" of a licence does encompass a transfer application. In support of that submission the applicant refers to the decision of Schmidt J in Rogers, where at [104] her Honour said: Under s 13A NCAT is not expressly empowered to review decisions of the Authority, when acting of its own initiative, even if trade at such times results. It is empowered, however, to review decisions which the Authority makes under the Liquor Act, in the case of a hotel, "in relation to" applications specified in reg 7, namely those made in relation to: (1) its licence; (2) an ongoing extended trading authorisation that would result in trading after midnight; and (3) variation or revocation of license conditions imposed by the Authority which would result in trading after midnight.
The applicant submits that therefore on the proper construction of s 13A and cl 7(1)(a), an application for a transfer is "in relation to" the granting of a licence.
In the Tribunal's view that submission does not have sufficient regard to the issue that was before the court in Rogers. ILGA had refused an application by the Commissioner of Police for the revocation of the extended trading hours authorisation for a hotel, and, acting on its own initiative, had varied the extended trading authorisation to reduce the trading hours after midnight. The owner and the licensee brought proceedings in the Supreme Court seeking declaratory relief and orders setting aside the decision, on grounds that the decision was invalid for failure to comply with mandatory statutory conditions precedent in s 51(13) of the Liquor Act; denial of procedural fairness; and that they had been wrongly deprived of a contestable argument on merits review of the decision to deal with the revocation application by ILGA's decision to act of its own initiative.
Schmidt J held that the failure by ILGA to comply with the mandatory prerequisites to the exercise of its powers rendered the disputed decision invalid, and the orders sought should be granted. In concluding that the failure lead to invalidity, her Honour held that it was relevant to take into account: 61….that the legislature has provided for a merits review of the Authority's decisions in only limited circumstances, which do not include cases where the Authority decides to act of its own initiative, as it did in this case.
Schmidt J considered whether the licensee had rights to merits review of which he had been deprived by ILGA's decision to act on its own initiative, and at [101]-[103] held: 101What is immediately apparent is that reg 7, like the Liquor Act, draws a distinction between licences, conditions of a licence and extended trading authorisations. But under this regulation, a "condition of a licence" does not include either an authorisation, or conditions which may be imposed on an authorisation. That is because s 51(11) of the Liquor Act provides only that it is for the purposes of that Act, that any condition to which an authorisation is made subject, is taken to be a condition of the licence. 102Regulation 7(b) is concerned with applications for an ongoing extended trading authorisation and reg 7(c) with applications to vary or revoke a licence condition, which in either case, "would result" in trading after midnight. In understanding what this term means, it is apparent that the regulation is concerned with applications which, if granted, would have the specified result. That is because account must be taken of the fact that under the Liquor Act, the grant of an authorisation or condition which permits trade to be pursued after midnight, does not require a licensee to exercise the permission to trade so given. 103It is apparent that the merits review of the Authority's decisions which reg 7(b) and (c) permit are in respect of applications which, if granted, are valuable and the regulation thus assumes that they would be availed of by the licensee, if granted. That explains the use of the words "would result" in trade after midnight.
The statement by Schmidt J at [104] (at [32] above) on which the applicant relies should be read in the context of those immediately preceding comments. Rogers does not support the proposition that cl 7 encompasses any application at all in relation to a hotel licence, rather her Honour was contrasting those applications which, if granted, are valuable and are likely to be availed of, with the circumstance where the regulatory authority of its own initiative decides to vary existing entitlements which may or may not be exercised.
The applicant further relies on ss 60(5) and 60(12). The applicant submits that s60(5) expressly directs ILGA to treat the transfer application as a grant of a licence, by requiring ILGA to deal with and determine the application as if it were an application for a licence, and by requiring ILGA to apply the provisions of Part 4 Div 1 to an application under s 60.
In support of that submission, the applicant relies on the decision of the Appeal Panel in Independent Liquor and Gaming Authority v Auld [2018] NSWCATAP 184. The decision under appeal in Auld was a decision of the Tribunal to set aside ILGA's refusal of Mr Auld's application under s 59 of the Liquor Act to remove a hotel licence to other premises, being an ALDI store, and to approve that application providing for licence conditions that in effect limited the activities carried out under that licence to the supply of packaged liquor for consumption off the premises: Auld v Independent Liquor and Gaming Authority [2018] NSWCATAD 25. There was no issue as to the jurisdiction of the Tribunal to review the decision, because a decision in relation to an application for the removal of a hotel licence is prescribed under cl7(a) of the GLA Regulation, and is thus an administratively reviewable decision under the ADR Act. The challenge was to the decision of the Tribunal that the licence could be removed and converted to a packaged liquor licence at the new premises.
The applicant in these proceedings relies on the discussion in Auld of s 59(3) of the Liquor Act, which is in similar terms to s 60(5): (3) An application for approval to remove a licence to other premises is to be dealt with and determined by the Authority as if it were an application for the granting of a licence in respect of those other premises. Accordingly, the provisions of Division 1, in particular, extend to an application for the removal of a licence to other premises as if it were an application for a licence.
The Appeal Panel held: 113. The Authority submitted that s 59(1) was the operative provision and s 59(3) was merely "mechanical". We do not agree with that submission. As explained above, s 59(1) does not confer any power on the Authority. Nor, on its proper construction, does it expressly or impliedly limit any power conferred on the Authority by other provisions of the Liquor Act. 114. Contrary to the Authority's submission, s 59(3) does not provide the mechanism for making an application under s 59(1). Section 59(2) sets out how an application is to be made and might be seen as a mechanical provision supplementing s 59(1). In our view, s 59(3) is the operative provision. It imposes a duty on the Authority to deal with and to determine a removal application: (1)"as if it were an application for the granting of a licence in respect of those other premises"; and, (2)the provisions of Div 1 of Pt 4 of the Liquor Act "extend to an application for the removal of a licence to other premises as if it were an application for a licence". 115. Part 4 Div 1 includes s 45(1) which expressly empowers the Authority to grant or refuse to grant a new licence after considering the application and any submissions received. 116. As to the other provisions of Pt 4 Div1, it was not suggested on this appeal that any of those provisions, apart from s 45(3)(c), had not been complied with. Section 45(3)(c) will be examined in more detail when we deal with grounds 2 and 3. 117. When s 59(3) is read with s 45, it can be seen that the Authority's power and duty is to determine whether to grant or refuse a removal application in the same way that it would determine "an application for the granting of a licence in respect of those other premises". The use of "a licence" in s 59(3) is, however, ambiguous.
Auld does not support the applicant's contention that s 60(5) has the effect that an application for approval of a transfer is to be regarded as an application for the granting of a licence. While s 59(3) and s 60(5) are in similar terms, a significant difference between the determination of an application for transfer and an application for removal is that s 59(1) does not itself confer power on ILGA to approve an application to remove a licence. In Auld the Appeal Panel relied on s 45(1), in Part 4 Div 1, as the source of power for ILGA to grant or refuse a licence. At [117] the Appeal Panel concluded that reading s 59(3) with s 45, ILGA's power and duty "is to determine whether to grant or refuse a removal application in the same way that it would determine 'an application for the granting of a licence in respect of those premises'". That is not a statement that approval of a removal application is the granting of a licence. In contrast, s 60(1) confers power on ILGA to approve an application for the transfer of a licence, and there is no need to rely on the power conferred by s 45(1) to confer that power. Section 60(5) should be read in its terms, that is, as a requirement that ILGA comply with the requirements of Part 4 Div 1 that would have to be met in dealing with an application for a new licence, but not as deeming an application for transfer to be an application for a new licence.
Section 60(12), which has no equivalent in the case of a removal under s 59, does not take the matter further. It does not state that the transfer of a licence is a grant of a licence to the transferee, rather that once granted it "has effect as if" the licence had been granted to that person.
The direction in s60(5) (and in s59(3)) is not limited to procedural matters. Section 60(4) (and s 59(2)) enable prescription of the applicable form, fee, and required information for each type of application. In that context, the approval of separate forms and differential fees for applications for a licence and for a transfer, on which the respondent relied, is not determinative.
The power to approve an application for transfer is qualified by the requirement that the transfer must be to a person who, in the opinion of ILGA, would be entitled to apply for the same type of licence in relation to the licensed premises. In dealing with an application for transfer of a licence, ILGA is required to satisfy itself of all the matters that would have to be satisfied if it were considering whether to grant a new licence to the proposed transferee. The identity and characteristics of the proposed transferee are clearly relevant, and the application of the provisions of Part 4 Div 1 has the effect of identifying the criteria which ILGA is to apply in determining the application, namely those specified in s 45(3)(a), (5) and (5A).
In contrast, the criteria for determining an application for removal of a licence require in addition consideration of the impact on the local community. An application under s 59 for approval to remove a licence to other premises is a "relevant application" as defined in s 48(2), which is intended to facilitate consideration of the impact the granting of certain licences authorisations or approvals will have on the local community, and under which an application must be accompanied by a community impact statement. An application for approval of a transfer is not such an application.

DPR v Independent Liquor and Gaming Authority

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