WESTERN AUSTRALIAN HOTELS & HOSPITALITY ASSOCIATION

Liquor licensing - Special Facility Licence - Where appellants obtained development approval from local authority for a licensed cafe/restaurant which could seat up to 100 patrons - Where certificate granted in support of application for a restaurant licence on the basis that patrons would be able to purchase alcohol without purchasing food, but only while seated at tables - Application by appellants to Liquor Licensing Court for grant of a Special Facility Licence - Second certificate issued by local authority requiring any liquor licence to be issued for a 'restaurant' only - Whether second certificate a nullity - Where use proposed in the application for a Special Facility Licence was significantly different to use approved by the local authority under applicable planning laws - Turns on own facts

Liquor Licensing Act 1988, s 37, s 40, s 46, s 50, s 60

Brickworks Ltd v Warringah Shire Council [1963] HCA 18; (1963) 108 CLR 568

Comptroller General of Customs v Kawasaki Motors Pty Ltd [1991] FCA 519; (1991) 32 FCR 219

Esber v The Commonwealth [1992] HCA 20; (1992) 174 CLR 430

Liquor Stores Association of WA (Inc) v Manya Holdings Pty Ltd [2000] WASCA 21

Minister for Immigration and Ethnic Affairs v Kurtovic [1990] FCA 22; (1990) 21 FCR 193

Northcott Pike & Associates Pty Ltd v District Council of Berri (1984) 55 LGRA 119

NSW Aboriginal Land Council v Minister Administrating The Crown Lands Act (1988) 14 NSWLR 685

Pearson v Leichhardt Municipal Council (1997) 93 LGERA 206

Rintag Pty Ltd v West Coast Hospitality Pty Ltd, unreported; FCt SCt of WA; Library No 990194; 20 April 1999

Ryde Municipal Council v Royal Ryde Homes [1970] 1 NSWR 277

Western Australian Hotels Association (Inc) v Mad Dog Mexican Co Pty Ltd [1999] WASCA 149

1 STEYTLER J: This is an appeal against a decision of the Liquor Licensing Court, refusing to grant to the appellants a Special Facility Liquor Licence under s 46 of the Liquor Licensing Act 1988 ("the Act") in respect of premises ("the premises") known as the AppleX Café and Restaurant situated at 11 Riseley Street, Ardross. The appeal was opposed by the City of Melville, the second respondent (to which I shall refer as "the City"), the other respondents having chosen to play no part in the appeal.

2 The circumstances giving rise to the appeal are largely common cause.

3 On 29 October 1998 the appellants lodged an application for development approval with the City. They sought approval for the conversion of the existing use to which the premises were being put, being that of a hardware store, to one of a "cafe/restaurant".

4 A report was then prepared by the assigned planning officer for consideration by the City's Planning and Development Services Committee. The report recorded that the proposed use ("cafe/restaurant (licensed)") was acceptable under Community Planning Scheme No 5 ("CPS 5"). At that time this Scheme had yet to come into force and land development within the City's jurisdiction was still controlled by its Town Planning Scheme No 3 ("TPS 3"), which made no provision for a "cafe/restaurant (licensed)" but which provided that "restaurants (licensed)" were a permitted use.

5 The report also recorded that the appellants had said that the proposed operation would be "mainly late afternoon/evening and will mainly involve the sale of alcohol with meals although people will be able to purchase a glass of wine or beer without purchasing food". It said that the appellants did not propose to have a bar in the cafe and that people would "sit at a table to consume food and drinks".

6 The Planning and Development Services Committee recommended that the application be refused because insufficient car parking was provided on site. However, the City's Council did not accept that recommendation and approved the change by notice dated 21 December 1998. The change of use to "cafe/restaurant (licensed)" was approved subject to various conditions. One of these was that the appellants were to provide "cash in lieu ... for 12 ... car bays". Another was that seating was to be limited to 100 seats.

7 The appellants appealed to the Minister for Planning against the imposition of the first of the conditions to which I have referred. Having been successful in doing so, they turned their attention to obtaining an appropriate liquor licence. They required, for that purpose, a certificate under s 40 of the Act. That section reads as follows:

"40. Certificate of local planning authority

(1) An application made to the licensing authority for the grant or removal of a licence, or for a change in the use or condition of any premises shall be accompanied by a certificate from the authority responsible for town planning matters in the district in which the premises to which the application relates are situated, or are to be situated, unless the licensing authority otherwise determines.

(2) A certificate referred to in subsection (1) shall state that the proposed use of the premises -

(a) will comply with the requirements of the written laws relating to planning specified;

(b) would comply with the requirements specified if consent were to be given by a specified authority, if it is known whether that authority will give the consent, and what specified conditions or specifications should be, or are likely to be, imposed; or

(c) will not comply with the requirements specified for the reasons specified.

'specified' means specified in the town planning certificate.

(4) The licensing authority may, where it is satisfied that it is desirable to do so, impose a condition on a licence relating to the submission, or further submission, to the licensing authority of a certificate referred to in subsection (1)."

8 By letter dated 31 May 1999 the appellants informed the City that the proposed "licensed Cafe/Restaurant" would have seating for no more than 100 patrons and that it would basically operate as a casual establishment. The City was told that it would "be capable of serving the meal and refreshment requirement of families as well as functions/parties and the other needs of the public".

9 The City provided a certificate dated 1 June 1999. By that certificate ("the first certificate") it certified that the premises would comply "with all relevant planning laws, namely ... Town Planning Scheme No 3".

10 By notice dated 24 September 1999 the appellants applied for a special facility licence in respect of the premises. Their application was supported by the first certificate.

11 Various categories of licences are provided for by the Act. These include hotel licences, cabaret licences, casino liquor licences, club licences, restaurant licences and, of course, special facility licences.

12 Restaurant licences are dealt with by s 50 of the Act. That section provides that, subject to the Act, the licensee of a restaurant licence is, during permitted hours, authorised to sell to any person liquor on the licensed premises for consumption on the premises but only where that is "ancillary to a meal supplied by the licensee to, and eaten by, that person there" (subs (1)). However, by subs (1a), where the licensee of the restaurant licence holds an extended trading permit under s 60(4)(ca) in respect of the premises, the licensee is authorised to sell liquor to a person, whether or not ancillary to a meal eaten by the person, if:

"(a) the liquor is consumed at a dining table; and

(b) not more than 20% of the seating capacity for customers on the premises is available, or being used at any one time, for persons to consume liquor other than ancillary to a meal."

13 A special facility licence, on the other hand, is one which is designed "to provide for the needs of persons of a particular class or in particular circumstances, or for a particular purpose" (s 46(1)). By s 46(2), a special facility licence cannot be granted where a licence of another class, or the imposition of a condition on a licence of another class, would be reasonably adequate. The purpose of the appellants, in applying for a special facility licence rather than a restaurant licence, was that of avoiding the restrictions on the supply of liquor which are contained within s 50.

14 In October 1999 it came to the attention of Mr Craig McClure, the Executive Manager of Development and Neighbourhood Amenity for the City, that the appellants had applied for a special facility licence. Mr McClure, in the course of his evidence at the hearing, said that he had been surprised to learn of this and was concerned that what was contemplated was "more than just a restaurant or cafe".

15 On 22 October 1999 the City's Planning and Development Services Manager wrote to the Director of Liquor Licensing, saying, inter alia, the following:

"I wish to advise that the Council on 21 December 1998, issued conditional planning approval for a 'Café/Restaurant (Licensed)'. The Council subsequently issued a Section 40 Certificate of Local Planning Authority on 1 June 1999 on the basis that the application is for a 'Restaurant Liquor Licence'.

Recently, the Council is of the impression that instead of a 'Restaurant Liquor Licence', the applicant has applied for a 'Special Facility Liquor Licence'. Should this be the case, the Council vehemently opposes this application and hereby gives notice to withdraw its Section 40 Certificate.

At the time that the Section 40 Certificate was referred to the Council, it was of the impression that the café/restaurant will be restricted to operate normal trading hours of a restaurant (up to 12:00am). Further, that the café/restaurant will operate such that liquor will only be served with food.

I would appreciate your immediate attention to the Council's request and a response to confirm the Council's concerns."

16 What was said in the last line of the penultimate paragraph of the extracted portion of the letter is not easily reconciled with what had been said in the report, referred to above, which had been prepared in respect of the appellants' application for development approval. I have earlier mentioned that that report recorded that patrons of the cafe/restaurant would be able to purchase a glass of wine or beer without purchasing food.

17 Then, on 14 December 1999, CPS 5 was gazetted and TPS 3 was revoked. On the following day the City, of its own volition, issued a second certificate ("the second certificate") for the purposes of s 40 of the Act. This certificate provided that the proposed cafe/restaurant would comply with CPS 5 "for a 'restaurant' liquor licence only". Moreover that statement bore an asterisk which led to a qualification to the effect that the certificate was "issued on the basis of a liquor licence being issued for a 'restaurant' only". The certificate was forwarded on to the Director of Liquor Licensing.

18 CPS 5 contained a use class table which was very different to that which had been in TPS 3. It provided (as had TPS 3) that a restaurant was a permitted use within the city centre. However, it treated restaurants separately from special facilities, each of those concepts having its own definition. A "special facility" was defined to mean a facility established for purposes in s 46(5) of the Act (which enables the sale of packaged liquor) or for another purpose in respect of which the relevant liquor licensing authority grants a "Special Purpose Licence" (presumably intended to be a reference to a special facility licence) within the meaning of the Act. TPS 3 had not included any reference to a "special facility", no doubt because the concept of a special facility licence was introduced by the Act for the first time in 1988, some three years after TPS 3 came into operation (in 1985).

19 CPS 5 also provided that other uses, not listed in the table, were not to be permitted within the city centre unless the Council exercised its discretion to grant planning approval.

20 In order to safeguard the rights of existing land users, cl 8.1 of CPS 5 provided that, except as otherwise provided, no provision of the Scheme would prevent the carrying out of any development for which, immediately prior to the gazettal date, a permit had been duly obtained and was current.

21 The appellant's application for the special facility licence came on for hearing in April 2000. The hearing lasted some five days. On the last of those days (4 May 2000), Greaves J informed the parties that he proposed to reserve his decision which, he said, would not be published until the appellants satisfied the court, "by a certificate issued ... pursuant to s 37 subsection (1)(f) and s 37 subsection (2)(a)" of the Act, that, if the court should grant the special facility licence which had been applied for, the law relating to planning would permit the use of the premises for the sale and consumption of liquor as proposed. Those sections read (relevantly) as follows:

"37(1) An application to the licensing authority for the grant of a licence ... shall not be granted by the licensing authority unless the licensing authority is satisfied -

(f) except where paragraph (e) applies [it was common cause at the hearing that it did not apply] -

(i) that the premises to which the application relates are, or when constructed will be, of a sufficient standard and suitable for the proper conduct of the business to be carried on there;

(ii) as to the matters referred to in subsection (2); and

(iii) as to the matters referred to in any certificate required to be produced under section 39 or section 40.

(2) On any application the licensing authority may require to be satisfied that any approval, consent or exemption required -

(a) under the law relating to planning to permit the use of the premises for the sale of liquor;

22 The appellants took up the position that they had the necessary certificate in the form of the first certificate. They contended that the second certificate was a nullity, no such certificate ever having been sought by them and the City never having had any power to issue a second certificate or any sufficient justification for doing so. However, because no further certificate was produced by the appellants, Greaves J, when asked by them to deliver his decision, refused the application.

23 He said, in that respect, the following (at [5] - [8]):

"The applicant has not produced such a certificate and the applicant has asked the Court to deliver its reserved decision. The parties have agreed that the Court should have regard to the affidavit of Craig Jeffrey McClure sworn 27 February 2001. At par 20 et seq of that affidavit, the deponent states in part:

' ... As the Council has not considered an application for a Special Facility use, and consequently has not approved a Special Facility use, if the Applicant was to obtain a Special Facility Liquor Licence and operate pursuant to that licence, it would necessarily be in breach of CPS 5.

The City therefore cannot at this time issue a certificate pursuant to s.37(1)(f) or s.37(2)(a) of the Liquor Licensing Act in the terms contemplated by the Court in its directions of 4 May 2000.'

Since the Court cannot be satisfied on this evidence that the law relating to planning will permit the use of premises for the sale and consumption of liquor as proposed under a Special Facility Licence, I am of the opinion that s 37(1)(f)(iii) of the Act requires the Court to refuse the application.

Otherwise, I am of the opinion on the evidence that the applicant has discharged the burden upon it under s 46 of the Act for a grant and that no valid ground of objection has been made out. In the circumstances, it is not necessary to express reasons for that conclusion. I only wish to observe I have given consideration to the imposition of a condition under s 40(4) of the Act relating to the submission of a further certificate. In my opinion, the Court should not exercise the discretion under s 40(4) where the evidence discloses that the local planning authority cannot issue such a certificate.

Accordingly, I am of the opinion that the application must be refused and I will direct accordingly."

24 The appellants appeal against that decision upon the ground that the Judge below erred in law in receiving the second certificate into evidence and according it any weight in circumstances in which the first certificate had been properly sought and obtained and in which the City was aware that the appellants proposed that patrons of the cafe/restaurant would be able to purchase alcohol without purchasing food. They contended that the City of Melville was "functus officio" and that the second certificate was a nullity. The appellants also raised, as a separate ground, a contention that the Judge below erred in law in having regard to the affidavit of Mr McClure sworn on 27 February 2001 in all of the circumstances.

25 The City, on the other hand, supports the decision of the Judge below upon the grounds upon which it was given and says that it should be affirmed on the additional ground that, on the evidence before it, the court could not be satisfied that the use of the premises in the manner proposed by the appellants under a special facility licence would be consistent with the planning approval for a restaurant use given by the City under TPS 3. It also contended that the court could not be satisfied that the use of the premises under the special facility licence would be lawful having regard for the provisions of CPS 5 or at all.

26 In my opinion Greaves J rightly held, on the evidence before him, that he could not be satisfied that the proposed use of the premises would comply with the requirements of the applicable planning laws. That is because the proposed use was one which had never been approved by the City.

27 The only use which had been proposed by the appellants to the City, and approved by the City under the applicable planning laws, was one of the premises as a "cafe/restaurant", with seating for no more than 100 patrons, at which alcohol might be served without the purchase of food, but in circumstances in which there would be no bar and people would "sit at a table to consume food and drinks". However the use which was proposed for the purposes of the application to the Liquor Licensing Court was significantly different. There the appellants proposed to have a bar which would "only have a standing area along with 4 island benches". The premises would have "Entry Seating" which would accommodate 40 seats where food and beverages might be consumed, a rear dining area which would accommodate 60 seats and an outside smoking area which would have four "conversational tables". Consequently, while the appellants proposed that the premises would still have a maximum of 100 seats, they obviously intended to accommodate significantly more than 100 patrons and many of these would consume alcohol while standing in areas provided specifically for that purpose. Mr Bradley Griffiths, who was proposed by the appellants to be the manager of the premises, said in evidence that he anticipated that there would, on Friday and Saturday nights, be up to 60 people over and above those who would have been catered for in an ordinary restaurant.

28 These differences alone (and there were others, including the addition of a dance floor) are sufficient, in my opinion, to take the proposed use outside that which had been approved by the City and which was the subject of the first certificate issued by it. The City had expressly conditioned its approval on seating being limited to 100 and it had done so in the belief that only seated patrons would be able to consume alcohol. Plainly, the additional number of patrons proposed to be accommodated in the premises under the proposal put to the Liquor Licensing Court might have had a significant impact on such things as the availability of adequate parking. Also, the additional numbers and the difference in the nature of the proposed use might have had a significant impact on the general amenity of the area. It is readily apparent from the evidence as a whole, and in particular that of Mr McClure, that the City would not have approved the use which was proposed to the Licensing Court. Indeed, it was not prepared to grant a certificate in respect of that use when it was later asked to do so.

29 The Liquor Licensing Court could consequently not have been satisfied, on the strength of the first certificate, that the proposed use of the premises would "comply with the requirements of the written laws relating to planning". The first certificate related to a different use and was consequently of no assistance to the court. Moreover, CPS 5 had by then come into effect and the now proposed use could only be implemented, under that Scheme, if the City's Council exercised a discretion to grant planning approval and it had not done so. The use was not protected by cl 8.1 of CPS 5 because it had never been approved by the City. All that had been approved by it was the different use to which I have earlier referred. In these circumstances, it seems to me, Greaves J rightly declined to accede to the appellants' application.

30 This conclusion is not affected by the debate as regards the issue, which arose both before Greaves J and again on the hearing of the appeal, whether or not it was open to the City, once having issued a certificate for the purposes of s 40 of the Act, to revoke that certificate and issue another. It is, as counsel for the City conceded, unfortunate that it purported to revoke the first certificate. There was never any need for it to have done so. It was enough for it to have informed the court as, in effect, it did (and, in my opinion, it was undoubtedly entitled to do so), that the certificate which was relied upon by the appellants was for a use which was different to that which was proposed for the premises at the time of the hearing by the Licensing Court, and that the now proposed use (described to the Liquor Licensing Court by the then counsel for the appellants as an "up-market drinking establishment") was one which had never been approved by the City and would not be approved by it and therefore did not comply with the applicable planning laws.

31 I should add, in this last respect, that it seems to me that, by virtue of s 37(1)(f)(iii), the licensing authority is required to be satisfied, as a pre-condition to the grant of a licence, that the proposed use of the premises will comply with the requirements of the written planning laws and, while it will ordinarily satisfy itself by resort to a certificate issued under s 40, the prospect of further evidence in respect of the matters certified is left open. While s 37 and s 40 are not as lucid as they might be, the scheme of the Act appears to be relevantly that satisfaction as to the matters referred to in any certificate required to be produced under s 40 is to be a pre-condition to the grant of a licence (s 37(1)(f)(iii)), that an application made to the licensing authority for the grant of a licence must be accompanied by a certificate from the authority responsible for town planning matters in the relevant district unless the licensing authority otherwise determines (s 40(1)) and that the certificate shall state that the proposed use of the premises will comply with the requirements of the written laws relating to planning which are specified in that certificate (s 40(2)(a)). I agree, in this respect, with what has been said by Wheeler J in Re The City of Bunbury; Ex parte Highway Hotel Pty Ltd [2000] WASC 62 at [20] as follows:

"Importantly, the relationship between the content of the certificate and the relevant satisfaction pursuant to s 37 is not immediately apparent. As a matter of first impression, s 37 requires that not only must there be a certificate, but that the licensing authority must be 'satisfied' as to the matters which it contains; that is, the mere existence of a certificate is not sufficient to fulfil the statutory requirement. It would appear that the licensing authority may rely upon the certificate in order to satisfy him or herself as to the matters which it contains, but that the possibility is left open of further evidence which might bear on the matters contained in the certificate; that is, the certificate does not appear to be conclusive proof of its contents. The procedure by which the certificate is produced, and the form of the certificate appear to be matters left to the discretion of the relevant local authority."

32 I should add that her Honour also remarked, in [21] of her reasons, that the statutory intention appears to be reasonably clear and that, on the second reading of the Bill for the Act, the Minister introducing it into the Legislative Assembly observed that "The Government recognises the important role played by local government in deciding where licensed premises should be located. The licensing authority will not be able to grant a licence unless prior local government planning approval is given (Hansard 13 September 1988 at 2652)."

33 It follows, from the conclusion at which I have arrived, that it matters little, for the purposes of the appeal, whether the second certificate was or was not a nullity, as the appellants contend it was. Even if it was a nullity, this could not alter the fact that the first certificate related to a use different to that proposed by the appellants to the Liquor Licensing Court and was therefore of no assistance to the appellants for the purpose of satisfying the requirement imposed by s 37(1)(f)(iii) of the Act.

34 Similarly, while counsel for the appellants contended, referring to such cases as Bott v Meagher (1996) 39 NSWLR 710 and Kennedy v Emery (1997) 41 NSWLR 413, that the Judge below had wrongly permitted a "collateral challenge" to the validity of the first certificate, the more appropriate analysis, in my opinion, is that there was no need for any challenge to the validity of the first certificate. It was, as I have said, enough that it related to a use different to that proposed to the Liquor Licensing Court.

35 The first ground of appeal has consequently not been made good.

36 I am also not persuaded that Greaves J made any relevant error in having regard to the matters raised in Mr McClure's affidavit sworn on 27 February 2001. That affidavit addressed matters which occurred subsequent to the directions given by Greaves J on 4 May 2000. Even if his Honour had paid no regard at all to this affidavit, that could not have altered the fact that the appellants had not, on the evidence which was already before him, satisfied the requirements of s 37(1)(f)(iii) in respect of the use of the premises proposed by them to the Liquor Licensing Court. In any event, as Greaves J remarked in the course of his reasons, both parties had agreed that the Court should have regard to that affidavit. Ground 2 has consequently also not been made out.

37 Because ground 3 of the grounds of appeal merely mirrors what has been said in grounds 1 and 2 in contending what should have been found by the Judge below, it follows that it, too, has not been made out.

39 That leaves the appellants in a somewhat invidious position. If they now wish to apply for a liquor licence in respect of the use originally proposed to, and approved by, the City, they will have to start again. However I assume that any such proceedings will significantly be shortened having regard for the fact that the Liquor Licensing Court has already heard evidence in relation to, and been satisfied in respect of, matters other than planning matters. However that is a matter for that Court if, indeed, the appellants should make such an application.

40 HASLUCK J: I agree with the reasons for judgment of Steytler J and to the orders proposed by his Honour. There is nothing I wish to add.

41 OLSSON AUJ: I have had the advantage of reading, in draft, the reasons expressed by Steytler J. I agree both with his reasoning and the conclusions to which he has come.