New Zealand Police v Casino Bar

• Jurisdiction: New Zealand
• Judge: Dobson J
• Judgment Date: 04 February 2013
• Neutral Citation: [2013] NZHC 44
• Docket Number: CIV-2012-485-1491
• Court: High Court
• Date: 04 February 2013

BETWEEN

Under the Sale of Liquor Act 1989

In The Matter of a decision of the Liquor Licensing Authority [2012] NZLLA 723 dated 27 June 2012

New Zealand Police

Appellant

and

Casino Bar (No 3) Ltd

First Respondent

and

Cgml Limited

Second Respondent

Earl Forrester Hilton

Third Respondent

[2013] NZHC 44

CIV-2012-485-1491

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

Appeal from Liquor Licensing Authority's decision to grant the respondent an on-licence in respect of adult entertainment venue “Calendar Girls” — police and second respondent (which operated competing venue) opposed application on basis that applicant's husband had serious criminal offences — opposition dismissed as applicant undertook that husband would not have a role in the business — second respondent's opposition dismissed on basis it was a trade competitor under s13(2) Sale of Liquor Act 1989 “SLA” — whether the Authority had erred: by applying an incorrectly narrow assessment of “suitability” and by relying on the absence of applications by the Police in different licensing districts to revoke the other licences that had been granted to businesses associated with the applicant — whether reports filed by the appellant under s11 SLA (reports), should have been treated as objections for the purposes of triggering the requirement under s106(2) SLA (procedure) for a hearing to be held.

Counsel:

T G H Smith & S Kennedy for appellant

M Bendall and B D Jones for first respondent

A G Sherriff for second respondent

RESERVED JUDGMENT OF Dobson J

Contents

Background to the appeal	[1]
First alleged error of law: incorrectly narrow assessment of “suitability”	[28]
Second alleged error of law: failure to acknowledge status of Police reports.	[42]
Third alleged error of law: LLA wrongly rejected CGML objection	[57]
Consequential error: immediate issue of the licence	[70]
Outcome	[78]
Costs	[79]

Background to the appeal

1 On 27 June 2012, the Liquor Licensing Authority (LLA) issued a decision in which it granted an application by the first respondent (CBL) for an on-licence under the Sale of Liquor Act 1989 (the Act) in respect of an adult entertainment venue in central Wellington known as “Calendar Girls”. 1 Its decision was to have immediate effect.

2 On the basis of serious concerns about the suitability of the applicant, the Police had opposed the grant of the licence. The second respondent (CGML), a member of the Chow Group of companies, also opposed the application. Its objection acknowledged that it was a competitor of CBL, but sought to pursue grounds of objection unrelated to the adverse effects of competition from CBL on its own operation. The third respondent (Mr Hilton) also lodged an objection to the application. The LLA treated that objection as having no status because it had been received out of time.

3 Despite the matters raised in opposition to the application, it was granted by the LLA without convening a hearing. The Police then appealed the LLA's decision. The appeal is brought under s 139 of the Act which confines such appeals to questions of law. The Police have raised a series of questions of law as to the manner in which the LLA dealt with the application and its grounds for granting it. CGML presented argument in support of the appeal. Mr Hilton took no part in the appeal.

4 CBL had lodged its application with the District Licensing Authority (DLA) on 30 March 2012. The application described a Ms Le Prou as the sole director and shareholder of the applicant company. In accordance with the statutory requirements for the grant of a licence, the application confirmed that there was no reason to believe that the applicant was not a suitable entity to hold a liquor licence. It made no reference to Ms Le Prou's husband, Mr James Samson.

5 The statutory process under the Act provides for any person who has a greater interest in the application than the public generally to object to the grant of an on-licence. 2 Objection may only be made in relation to matters relevant to the criteria for on-licences. 3

6 To the extent it is relevant to this appeal, the criteria in s 13 provide as follows:

13 Criteria for on-licences

• (1) In considering any application for an on-licence, the Licensing Authority or District Licensing Agency, as the case may be, must have regard to the following matters:

  • (a) The suitability of the applicant:

  • …

  • (g) Any matters dealt with in any report made under section 11 of this Act.

  • (2) The Licensing Authority or District Licensing Agency, as the case may be, must not take into account any prejudicial effect that the grant of the licence may have on the business conducted pursuant to any other licence.

7 The Act also provides for all applications to be served on the Police and provides, in s 11(3), as follows:

11 Reports

…

(3) The Police and the Medical Officer of Health must each inquire into and, if they have any matters in opposition, file with the District Licensing Agency a report on the application within 15 working days after receiving the application.

[8] In this case, the application was served on the Wellington Police liquor licensing section. The Police lodged a first report with the DLA on 30 April 2012, outlining the Police's opposition to the application. That report stated that the Wellington Police had made inquiries into the applicant and had serious concerns as to its suitability. The report also stated that if the applicant was determined to

proceed with the application, the Police asked that it be determined by the LLA at a public hearing. Subsequently on 9 May 2012, the Police lodged a second report, which stated, inter alia:

Police are satisfied through our inquiries to date that Le Prou's husband, Mr James Samson, has been significantly involved in the operation of the “Calendar Girls” business;

Samson is viewed by Police as a highly unsuitable individual to be involved in any licensed premise. He has been convicted of serious drug and firearm related offences and his last two convictions resulted in lengthy terms of imprisonment.

9 That second report attached a copy of Mr Samson's criminal record and repeated the request that a public hearing be convened if the application was to proceed.

10 In a third report dated 23 May 2012, the Police raised additional matters on the concern at Mr Samson's potential connection with the business. The report questioned whether Ms Le Prou had complied with undertakings she had given in the course of applications for off-licences for her “Calendar Girls” businesses in other centres. Such applications had been made in Christchurch in 2010 and in Auckland in 2011.

11 The third report advised that, on the basis of inquiries the Police had undertaken, the Police view was that Mr Samson had played an integral part in the establishment and management of the Calendar Girls business in Wellington up until that time. The report cited a media report dated 1 December 2011 which had quoted Mr Samson as “the businessman involved in opening Wellington's newest strip club” and “the spokesman for the Calendar Girls club”. That media report stated that a claim had been made in Court that Mr Samson was behind a “sex industry turf war in which two Christchurch massage parlours were firebombed”.

12 In addition, the third Police report cited Facebook pages in which Mr Samson listed his contact information via the “Calendar Girls” website, described himself as working at Calendar Girls and being pretty busy building Wellington's first five star gentlemen's club. Those Facebook references listed Mr Samson as marketing and events manager of Calendar Girls, both in Auckland and in Christchurch.

13 The report also referred to references in Mr Samson's Facebook pages to other Wellington adult entertainment venues in respect of which it appears Mr Samson had stated “it has passed my attention one is made form [sic] very dry sticks? I'll huff and I'll puff …”. According to the Police, this was a cause for concern to the operators of those businesses who were entitled to treat it as a threat, particularly in light of the suggestions of Mr Samson's connection with firebombing of similar businesses in Christchurch.

14 The report cited further evidence of Mr Samson's on-going involvement with the Calendar Girls businesses in Wellington and Auckland, including claims attributed to Mr Samson that he was making important business decisions for the business.

15 Separately from the Police's own inquiries, the third report cited from a report prepared by a senior gambling inspector from the Department of Internal Affairs dating from October 2011. That report raised concerns about links between a company that Mr Samson had an interest in and the Calendar Girls business in Auckland, and that Mr Samson was a signatory for the Auckland Calendar Girls business bank account, including having conducted significant transactions in relation to that account.

16 Mr Samson's participation in the business had apparently been discovered by the Department of Internal Affairs after Ms Le Prou had provided an affidavit in April 2011 in respect of the Auckland Calendar Girls business, in which she undertook that her husband would not be involved in running the business, and that he would only work for a wage and carry out duties required of a paid employee. In the months after that undertaking, it appeared that Mr Samson had become a signatory for the bank account operating the Auckland Calendar Girls business, and during June 2011 Mr Samson had cashed cheques drawn on that account for some $23,000 and written cheques to other entities for nearly $100,000.

17 CGML lodged an objection to the application pursuant to s 10 of the Act within the time provided for doing so. CGML's objection raised the same concern that the applicant was not a suitable...