Hackham Community Sports & Social Club Incorporated v Joperi Hotel Pty Ltd - [2009] SASC 333

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court)
HACKHAM COMMUNITY SPORTS & SOCIAL CLUB INCORPORATED v JOPERI HOTEL PTY LTD & ORS
[2009] SASC 333
Judgment of The Full Court
(The Honourable Justice Gray, The Honourable Justice White and The Honourable Justice Kelly)
3 November 2009
LIQUOR LAW - LICENSING - REMOVALS - HEARING OF APPLICATION AND POWERS OF LICENSING AUTHORITY
LIQUOR LAW - LICENSING - APPLICATION FOR NEW LICENCE - GENERAL
Appeal with permission against refusal by Licensing Court of application to remove existing club licence to alternative site, pursuant to section 60 of Liquor Licensing Act 1997 (SA) - construction and operation of sections 53, 60 and 99 of Licensing Act – whether Judge erred in utilising discretion under section 53 of Licensing Act in consideration of removal application - whether Judge took into account irrelevant material on the removal application - whether Judge erred by assessing a commercial, professionally run, profit-oriented club as being at odds with notion of a licensed club within meaning of Licensing Act – whether application pursuant to section 99 of Licensing Act for approval of Draft Management Agreement addressed by Licensing Court.
Held: appeal dismissed - consideration of issues of control and profit sharing relevant to removal application – section 53 discretion available when considering removal application – conclusions of Judge with respect to removal application open on the evidence and appropriate in circumstances - application pursuant to section 99 not yet addressed by Licensing Court.
Liquor Licensing Act 1997 (SA) s 3, s 17, s 21, s 36, s 49(3), s 53, s 60 and s 99; Gaming Machines Act 1992 (SA) s 14 and 68(2)(b); Licensing Act 1967 (SA) s 61(1), referred to.
In the Matter of an Application by Hackham Community Sports & Social Club [2008] SALC 19; Liquorland (Australia) Pty Ltd v Lindsey Cove Pty Ltd (2002) 81 SASR 337; Waiata Pty Ltd v Lane (1985) 39 SASR 290; Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission (2000) 203 CLR 194; R v Wallis; ex parte Employers Association of Wool Selling Brokers (1949) 78 CLR 529; Refrigerated Express Lines (A/Asia) Pty Ltd v Australian Meat and Live-Stock Corporation (1980) 21 ALR 333; Anthony Hordern & Sons Ltd v The Amalgamated Clothing & Allied Trades Union of Australia (1932) 47 CLR 1; Minister for Immigration and Multicultural and Indigenous Affairs v Nystrom (2006) 228 CLR 566; Anthony Hordern & Sons Ltd v The Amalgamated Clothing & Allied Trades Union of Australia (1932) 47 CLR 1; Haoucher v Minister for Immigration & Ethnic Affairs (1990) 169 CLR 648; Annetts v McCann (1990) 170 CLR 596; Re Minister for Immigration and Multicultural and Indigenous Affairs: Ex parte Lam (2003) 214 CLR 1; Minister for Immigration & Ethnic Affairs v Kurtovic (1990) 21 FCR 193; K-Generation Pty Ltd v Liquor Licensing Court (2009) 83 ALJR 327; Vakauta v Kelly (1989) 167 CLR 568; Galea v Galea (1990) 19 NSWLR 263; Antoun v The Queen (2006) 80 ALJR 497; Escobar v Spindaleri (1986) 7 NSWLR 51; SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 81 ALJR 515; Robb & Dale v Chief Commissioner of Police [2005] VSC 310, considered.

HACKHAM COMMUNITY SPORTS & SOCIAL CLUB INCORPORATED v JOPERI HOTEL PTY LTD & ORS
[2009] SASC 333
Full Court Gray, White and Kelly JJ
GRAY and KELLY JJ:
Introduction

This is an appeal by permission against a decision of the Licensing Court.
On 28 November 2008 the Licensing Court refused an application by the appellant, the Hackham Community Sports and Social Club Inc. under the provisions of section 60 of the Liquor Licensing Act 1997 (SA) (“Licensing Act”), to remove its existing club licence from a site located at the corner of States Road and Doctors Road, Hackham, to a site on Main South Road, Morphett Vale.
The Judge of the Licensing Court also had before him an application for approval under the provisions of section 99 of the Licensing Act of an agreement between the Hackham Social Club and the second appellant, Club Management Services (SA) Pty Ltd. That application was referred to the Court by the Liquor and Gaming Commissioner under the provisions of section 21 of the Licensing Act. On 25 March 2008, the Judge determined to adjourn the application under section 99 of the Licensing Act to await the outcome of the removal application under section 60 of the Licensing Act.
There are 55 respondents in this matter. All are objectors who were party to the Licensing Court proceedings. The fifty-fifth respondent, Independent Pub Group Pty Ltd, was represented by counsel. A large group of the remaining respondents were represented by counsel and another large group of respondents adopted submissions made by Ms Thompson MP, who appeared as a respondent in person. One other respondent appeared in person, an individual objector, Dr Pidgeon.
Background
The Hackham Social Club is the holder of a Club Liquor Licence under section 36 of the Licensing Act, and is also the holder of a Gaming Machine Licence under section 14 of the Gaming Machines Act 1992 (SA). The Hackham Social Club has held that Gaming Licence since 1995 and operates 15 gaming machines.
The Hackham Social Club sought an order approving the removal of the Club Liquor Licence to proposed new premises on Main South Road, Morphett Vale, under section 60 of the Licensing Act. As noted, the Hackham Social Club premises are currently located at a site on the corner of Doctors and States Roads at Hackham.
The Commissioner heard the removal application. The Commissioner decided to refer the application to the Licensing Court under the provisions of section 17(1)(b)(ii) of the Licensing Act on 24 August 2007.
As part of the overall application, the Hackham Social Club also made applications for variation of trading hours and for entertainment consent. Those applications were contingent upon the grant of the application for removal of the Club Liquor Licence to the Morphett Vale premises.
The application by Club Management Services for approval under section 99 of the Licensing Act, of an agreement between it and the Hackham Social Club, was referred to the Licensing Court on 4 March 2008 by the Commissioner under the provisions of section 21 of the Licensing Act. It was that application which the Licensing Court Judge declined to consider until after the determination of the application for removal.
It was the Hackham Social Club’s plan, if the removal application was successful, to engage the services of the management company Club Management Services, to run and manage the Hackham Social Club on its behalf. At the hearing before the Licensing Court, the Hackham Social Club produced a copy of an agreement, entitled the Draft Management Agreement, between itself and Club Management Services. Club Management Services then sought permission to appear in the removal application proceedings in order to protect what it claims was commercially sensitive information contained in the Draft Management Agreement. Eventually a redacted draft Management Agreement was exhibited in the Licensing Court proceedings. As Club Management Services is an unlicensed entity and, under the terms of the Draft Management Agreement, would be exercising control over the business and would be participating in the profits of the business, it was necessary for the parties to seek the approval of the Commissioner under the provisions of section 99 of the Licensing Act.
The Licensing Court commenced the hearing on 12 December 2007. The application occupied some nine sitting days, including a view by the Court of two sites and the local area.
The Licensing Court judgment in relation to the application for removal under section 60 of the Licensing Act
The Hackham Social Club’s application required the Court to consider the pre-requisites for removal under section 60 of the Licensing Act before making a decision under the provisions of section 53 of the Licensing Act to grant or refuse the application.
Section 60 of the Licensing Act provides:
Premises to which licence is to be removed
(1)     An applicant for the removal of a licence to premises or proposed premises must satisfy the licensing authority—
(a)that the premises to which removal of the licence is sought are, or, in the case of premises not yet constructed, will be, of an appropriate standard for carrying on business under the licence; and
(b)that the removal of the licence would be unlikely—
(i)to result in undue offence, annoyance, disturbance or inconvenience to people who reside, work or worship in the vicinity of the premises; or
(ii)to prejudice the safety or welfare of children attending kindergarten, primary school or secondary school in the vicinity of the premises.
(2)     An application for the removal of a licence to premises or proposed premises cannot be granted unless the licensing authority is satisfied—
(a)that any approvals, consents or exemptions that are required under the law relating to planning to permit the use of the premises or proposed premises for the sale of liquor have been obtained; and
(b)that any approvals, consents or exemptions that are required by law for carrying out of building work before the removal of the licence takes effect have been obtained; and
(c)that any other relevant approvals, consents and exemptions required for carrying on the proposed business from the premises have been obtained.
(3)     The licensing authority may dispense with the requirement that an applicant for the removal of a direct sales licence—
(a)satisfy the authority as to a matter referred to in this section; or
(b)submit plans.
The Judge found that on the evidence before the Court the applicant met the requirements of section 60(1)(a) and (c), and section 60(2) of the Licensing Act. Broadly speaking, that section requires the applicant to satisfy the Court that the removal of the licence would be unlikely to result in undue offence, annoyance, disturbance or inconvenience to people who reside, work or worship in the vicinity of the premises, or to prejudice the safety or welfare of children attending kindergarten, primary school or secondary school in the vicinity of the premises.
The Morphett Vale premises had previously been used as different restaurants, and the Judge considered that fact as follows:[1]
These premises were previously used as a licensed restaurant, in various guises, as a “Sizzler” and a “Yummies” and a “Tuckerland”. In any one of these guises, local residents would feel some effect in terms of parking, traffic, noise, and outdoor smoking areas (now the indoor smoking bans are in force). The particular locality of the subject land, and its zoning, make it almost inevitable that the land will be used for some commercial purpose, and that use will just as inevitably have an effect on the amenity of residents in the area.
[1] Hackham Community Sports & Social Club [2008] SALC 19 (28 November 2008, Chivell J) at [179].
The Judge noted that none of the potential effects identified or raised by the objectors were sufficient to cause him to find that the likely effects of granting the application would be undue within the meaning of section 60(1)(b)(i) of the Licensing Act. He found that if the site was made into a gaming venue, the effects would not be so inherently harmful that it would have the effects referred to in section 60(1)(b)(ii) of the Licensing Act. He therefore concluded that the Hackham Social Club had satisfied the requirements of section 60(1)(b) of the Act.
The Judge then went on to consider the exercise of the discretion in section 53 of the Licensing Act. That section provides:
Discretionary powers of licensing authority
(1)     Subject to this Act, the licensing authority has an unqualified discretion to grant or refuse an application under this Act on any ground, or for any reason, the licensing authority considers sufficient (but is not to take into account an economic effect on other licensees in the locality affected by the application).
(1a)   An application must be refused if the licensing authority is satisfied that to grant the application would be contrary to the public interest.
(2)     A licensing authority should not grant an application as a matter of course without proper inquiry into its merits (whether or not there are objections to the application).
(2a)   A licensing authority may—
(a)grant an application on an interim basis;
(b)specify that a condition of a licence, permit or approval is to be effective for a specified period,
and, in consequence, may give any necessary procedural directions in the matter.
(3)     A licensing authority may, on such conditions (if any) as it thinks fit, vary or waive compliance with formal requirements relating to an application.
(4)     If a licensing authority considers that an applicant should satisfy the licensing authority as to a certain matter for the purposes of determining the application, the licensing authority may, if the licensing authority thinks fit, nevertheless grant the application on the condition that the applicant satisfies the licensing authority as to the matter within a period determined by the licensing authority.
(5)     If a licence, permit or approval is granted on a condition under subsection (4), the licensing authority may, on failure by the applicant to comply with the condition, revoke the licence, permit or approval, or suspend the licence, permit or approval until further order.
(6)     A licensing authority may in proceedings accept an undertaking from a party in relation to the conduct of the proceedings and, on failure by the party to fulfil the undertaking, refuse to hear the party further in the proceedings subject to any further order of the licensing authority.
The Judge accepted the submission made by counsel for Joperi Hotel that the exercise of the discretion under section 53 of the Licensing Act required the Judge to have regard to the totality of the scheme proposed and not merely to one aspect of it. The Judge observed:[2]
…In my opinion, it would be pointless to try and assess the effects of the proposed removal which result only from the liquor aspect of the proposal, and ignore the fact that the venue will also contain gaming machines. This would be an unduly narrow and artificial approach, and would prevent me from assessing the true nature of the proposal when considering the exercise of the s53 discretion.
[2] Hackham Community Sports & Social Club [2008] SALC 19 (28 November 2008, Chivell J) at [21].
The Judge then referred to the Draft Management Agreement. After analysing the terms of the Draft Management Agreement, the Judge expressed particular concern about whether the proposed facility to be operated between Club Management Services and the Hackham Social Club, would in fact be an appropriate use of the opportunities created by the amendments to the Gaming Machines Act, by creating ‘Club One’. He concluded that by virtue of the agreement between the Hackham Social Club and Club Management Services, the Hackham Social Club had virtually ceded control of the day-to-day management of the Hackham Social Club to Club Management Services and effectively changed the character of the licensee from that of a community-oriented club to something much more commercial and profit-oriented in character.
The Judge concluded that Club Management Services would undoubtedly receive a substantial proportion of the profits derived from the operation of the facility and the fact that the Hackham Social Club, by virtue of a proposed under-lease, was given exclusive possession of the facility to the extent required by section 49(3) of the Licensing Act, did not affect his ultimate conclusion that Club Management Services were in effective control of the Hackham Social Club.
As the Judge observed:[3]
In my opinion, the grant of this application would result in the creation of an entity that is a “club” only in name. In my view, this proposed facility will be much more in the nature of a professionally-operated hotel or tavern than a non-profit association or club. Mr Matthews made it clear that their plan was to compete successfully with the nearby Emu Hotel. He said: “… we want to knock off the Emu, I make no bones about that”.
[3] Hackham Community Sports & Social Club [2008] SALC 19 (28 November 2008, Chivell J) at [203].
In refusing the application for removal the Judge finally concluded:[4]
In determining whether, in terms of s53(1a) of the LLA, the grant of the application would be contrary to the public interest, I have regard to the “principles and policies” in the Act, as Doyle CJ outlined in Liquorland v Lindsay Love [sic] (supra). In particular, I am satisfied that, for the reasons I have already expressed, to grant the application would allow the liquor industry to develop in a way which is not consistent with “the needs and aspirations of the community” (s3(1)(c)), and which, in the words of King CJ in Waiata v Lane (supra), would not lead to the “promotion and maintenance of a suitable balance between the various types of liquor facility available in a locality”.
[4] Hackham Community Sports & Social Club [2008] SALC 19 (28 November 2008, Chivell J) at [205].
Issues on appeal
The argument on the hearing of the appeal raises issues as to the construction of sections 53, 60 and 99 of the Licensing Act. Section 99 provides:
Prohibition of profit sharing
(1)     Subject to this Act, if a licensee—
(a)enters into partnership with an unlicensed person in relation to the business carried on under the licence; or
(b)enters into any agreement or arrangement under which an unlicensed person may participate in the proceeds of the business carried on under the licence (but this paragraph does not prevent the members of a licensed club from benefiting as members of the club from the proceeds of the business conducted under the licence); or
(c)remunerates an unlicensed person by reference to the proceeds or profits obtained from the business carried on under the licence or by reference to the quantity of liquor sold; or
(d)permits an unlicensed person (not being a person approved by the licensing authority) to conduct, superintend or manage the business carried on at licensed premises under the licence; or
(e)permits an unlicensed person to exercise control or substantial influence, without authorisation or approval under this Act, over the business conducted under the licence; or
(f)permits an unlicensed person to hold himself or herself out to the public as the licensee,
the licensee and the unlicensed person are each guilty of an offence.
(2)     The Commissioner may, on application by an interested person, approve an agreement or arrangement if—
(a)the agreement or arrangement—
(i)is likely to assist the liquor industry and industries with which it is closely associated—such as tourism and the hospitality industry; or
(ii)is otherwise in the public interest,
or there is some other good reason for approving the agreement or arrangement; and
(b)the agreement or arrangement does not adversely affect the rights and reasonable expectations of persons presently in employment.
(3)     If an agreement or arrangement approved under subsection (2) provides for a trust or corporate entity to conduct, superintend or manage the business conducted under a licence, that business must nevertheless be conducted under the personal supervision and management of a natural person approved by the licensing authority.
(4)     The Commissioner may, on application by the holder of a licence authorising the sale of liquor by wholesale, approve an agreement or arrangement between that holder and an unlicensed agent under which the agent is to be remunerated by reference to the quantity of wholesale sales of liquor made by the agent.
(5)     The Commissioner must not approve an agreement or arrangement under subsection (4) unless satisfied—
(a)that the agent is a fit and proper person to act as an agent of the licensee; and
(b)that the nature and scale of the business to be conducted by the agent under the proposed agreement or arrangement is not such that, taken alone or in conjunction with the business conducted under all other similar agencies held by the agent with other holders of wholesale licences, the agent should properly hold an appropriate licence under this Act in relation to that business.
(6)     Subsection (1) does not apply to—
(a)an agreement or arrangement approved under subsection (2) or (4) or any other provision of this Act, or anything done under any such approved agreement or arrangement; or
(b)any contractual provision for the remuneration of an employee of a licensee (other than a provision that confers on the employee a right to a share of the profits of the business conducted under the licence or provides that the remuneration of the employee is to vary by reference to the quantity of liquor sold); or
(c)an agreement or arrangement providing for the disbursement of profits or proceeds to a person in a position of authority in a trust or corporate entity that holds the licence or to a shareholder or beneficiary approved by the licensing authority as being a fit and proper person.
(7)     For the purposes of subsection (2)—
interested person includes an association formed to protect or further the interests of—
(a)the liquor industry or a particular section of the liquor industry; or
(b)employees in the liquor industry or a particular section of the liquor industry.

Both section 53 and section 99 grant a discretion to the licensing authority. It is necessary to consider the interaction of those two sections within the scheme of the legislation as a whole. It is also necessary to examine the nature and the extent of the discretion in each section.
The Hackham Social Club contended that the Licensing Court Judge was wrong to place any reliance on the contents of the Draft Management Agreement when determining whether the application for removal under section 60 of the Licensing Act should be granted. It was said that issues relating to the questions of control of the Hackham Social Club by, and profit sharing with, the unlicensed entity Club Management Services, were not relevant to any issue arising in relation to the removal application. These matters should have been addressed in relation to the application under section 99 of the Licensing Act. It was said that the Judge recognised this when he declined to consolidate and hear together both applications. Furthermore, it was contended that the Draft Management Agreement was in draft form only, therefore capable of being factually and legally amended to alter the relationship between the Hackham Social Club and Club Management Services. The Hackham Social Club’s application for removal did not depend upon the existence, or otherwise, of a management agreement between it and Club Management Services. The Hackham Social Club maintained that submission, notwithstanding that the Hackham Social Club itself tendered the Draft Management Agreement in the Licensing Court proceedings and called a number of witnesses who gave evidence concerning the application of the Draft Management Agreement.
The Hackham Social Club went on to submit that even if issues of management and control of the Hackham Social Club by Club Management Services were relevant to the removal application, the Licensing Court failed to place any meaningful weight on the requirement in the Draft Management Agreement that Club Management Services was obliged ultimately to accept the reasonable directions by the Hackham Social Club in respect of the management of the facility.
Although counsel representing the various objectors, and some of the individual objectors themselves, made separate submissions, the thrust of the respondents’ submissions was essentially the same; namely, that the Licensing Court was entitled, indeed obliged, to take into account the effect of the proposed arrangement between the Hackham Social Club and Club Management Services when assessing the effect on the community if the removal application were to be granted. It was contended that to do otherwise would be artificial. Furthermore, as counsel for a number of the respondents pointed out, the requirement that Club Management Services take reasonable directions from the Hackham Social Club, did not itself give full control to the Hackham Social Club. The Court’s finding that the Hackham Social Club, by virtue of the Draft Management Agreement, effectively ceded control of the Hackham Social Club’s day-to-day management to Club Management Services, was consistent with the evidence.
The Hackham Social Club’s second complaint was that in addition to taking into account irrelevant material on the removal application, the Licensing Court Judge also erred by importing into the concept of a licensed club the erroneous notion that a commercial, professionally run and profit-oriented club is at odds with the notion of a licensed club within the meaning of the Licensing Act. Counsel for the Hackham Social Club pointed to the Judge’s comments where he opined that the facility proposed by the Hackham Social Club would be much more in the nature of a professionally operated hotel or tavern than a non-profit association or club.
Club Management Services’ grounds of appeal raise issues both of procedural fairness and the proper construction of both sections 53 and 99 of the Licensing Act. Counsel for Club Management Services joined with the submissions made by the Hackham Social Club that the Judge had taken into account irrelevant material in the form of the Draft Management Agreement, in determining the removal application under section 60.
Club Management Services contended that it had also been denied procedural fairness by the manner in which the Licensing Court disposed of the application for removal. In advancing this ground of appeal, Club Management Services contended that because it was not a party to the removal application, nor could it have been joined as a party, it was effectively deprived of an opportunity to put submissions to the Court which might have affected the outcome of the application for removal. It was further contended that the Judge’s assessment of the Draft Management Agreement in the context of the section 60 application for removal, pre-empted the application by Club Management Services for approval of the Draft Management Agreement under section 99 of the Licensing Act.
We now turn to consider the issues arising on the appeal.
The Statutory Scheme
Section 3 of the Licensing Act sets out the objects of the legislation:
(1)     The object of this Act is to regulate and control the sale, supply and consumption of liquor for the benefit of the community as a whole and, in particular—
(a)to encourage responsible attitudes towards the promotion, sale, supply, consumption and use of liquor, to develop and implement principles directed towards that end (the responsible service and consumption principles) and minimise the harm associated with the consumption of liquor; and
(b)to further the interests of the liquor industry and industries with which it is closely associated—such as the live music industry, tourism and the hospitality industry—within the context of appropriate regulation and controls; and
(c)to ensure that the liquor industry develops in a way that is consistent with the needs and aspirations of the community; and
(d)to ensure as far as practicable that the sale and supply of liquor contributes to, and does not detract from, the amenity of community life; and
(e)     to encourage a competitive market for the supply of liquor.
(2)     In deciding any matter before it under this Act, the licensing authority must have regard to the objects set out in subsection (1).
In the present proceeding, the removal application concerns not only the relocation of the Hackham Social Club, but its relocation to a busy commercial complex, together with a significant enlargement of the activities of the Hackham Social Club, including the intended increase in gaming machines from 15 to 40.
In Liquorland v Lindsey Cove, [5] Doyle CJ considered observations of King CJ in Waiata Pty Ltd v Lane[6] to have continuing relevance to the present statutory regime. As Doyle CJ noted, in relevant respects, there has been no substantive change to the legislation. In particular, Doyle CJ considered the following observations of King CJ to have application. In Waiata, King CJ when addressing the progenitor provision to section 53 of the present legislation observed:[7]
The s 61 discretion is the means by which the Licensing Court is enabled to promote the shaping and development of an orderly and harmonious system of liquor facilities designed not only to meet the public need for liquor facilities but also to protect the wider public interest in the preservation of the community from adverse social effects.
The language of the section enables the Court to exercise the discretion on grounds or for reasons which commend themselves to the Court and irrespective of the grounds which may be relied upon by the parties to the proceedings. These grounds or reasons include any proper principles or policies which the Court has developed for the attainment of the purposes of the Act. Such principles or policies may relate to the undue proliferation of licences or of certain types of licences. They may relate to the promotion and maintenance of a suitable balance between the various types of liquor facility available in a locality. The Court is authorized by s 6b to inform itself in any manner in which it sees fit and that includes informing itself by reference to its own records and its own knowledge of liquor facilities which have been granted or promised by the Court and to the previous history of proceedings relating to particular premises. The Licensing Court must act judicially, but there is an unmistakeably administrative element in its task of promoting, encouraging and maintaining a system of liquor facilities to meet the public need for liquor facilities and the wider community interests.
[5]    Liquorland (Australia) Pty Ltd v Lindsey Cove Pty Ltd (2002) 81 SASR 337.
[6]    Waiata Pty Ltd v Lane (1985) 39 SASR 290 at 293-294.
[7]    Waiata Pty Ltd v Lane (1985) 39 SASR 290 at 294-295.
In particular, Doyle CJ commented: [8]
…I consider that what King CJ said is still appropriate, and that nothing in s 3 of the Act, setting out the objects of the Act, conflicts with what he said.
In short, the discretion must be exercised for a purpose consistent with the Act, and to advance or to maintain principles and policies found in the Act, or which the Court in its experience finds appropriate or necessary in the proper application of the Act. On the other hand, the Court must be careful not to use the discretion as a basis for imposing views about what is desirable, unless those views are firmly linked to the principles on which the Act operates or is administered.
[8] Liquorland (Australia) Pty Ltd v Lindsey Cove Pty Ltd (2002) 81 SASR 337 at 343.
As Doyle CJ observed in Liquorland,[9] hotels are intended to be establishments for public relaxation and entertainment. The entertainment may take many forms, including dining, casual conversation, live music and the use of gaming machines. The intended use of the proposed premises by the Hackham Social Club is a relevant consideration on the application for removal, and this includes the proposed use of the increased number of gaming machines.
[9] Liquorland (Australia) Pty Ltd v Lindsey Cove Pty Ltd (2002) 81 SASR 337 at 344-345.
In our view it is clear that the general discretion reposed in the licensing authority by the provisions in section 53 has application when the licensing authority is considering a removal application pursuant to section 60. There is nothing in the terms of section 60 that would suggest that the removal application is to be addressed by the Court only having regard to the terms of that section. There is nothing in the terms of section 60 that seeks to exclude the general discretion provided by section 53. It is significant that the terms of section 53 provide an unqualified discretion to grant or refuse an application under the Licensing Act, and that the availability of that unqualified discretion is only limited by the words in section 53, “subject to this Act”. As discussed above, there is nothing in section 60 that would preclude the operation of section 53. The submission that the section 53 discretion was not available is misconceived and should be rejected.
As discussed above, although the application pursuant to section 99 of the Licensing Act in respect of the approval of the Draft Management Agreement, was referred by the Licensing Commissioner to the Licensing Court Judge, it is evident that the Judge did not deal with that application. If the application for approval is to be pursued, it is to be considered on its merits at an appropriate time. In the course of submissions before this Court, it was suggested that the general discretion under section 53 had no application to the section 99 application. Our preliminary view is that this submission should be rejected. However, as the section 99 application has not yet been addressed by the Licensing Court, there is no need to further consider this submission.
It was submitted by the Hackham Social Club and Club Management Services that the Licensing Court Judge had inappropriately had regard to the terms of the Draft Management Agreement in his consideration of the removal application. The submission by Club Management Services went so far as to suggest that the Judge had predetermined the section 99 application for approval. In our view, the terms of the proposed management of the Hackham Social Club, at the proposed premises, was a material consideration. It was entirely appropriate for the Judge to act on that material, it being material placed before the Court by the Hackham Social Club. It was material addressed by a director of Club Management Services when giving evidence before the Licensing Court. Club Management Services and its director were represented by counsel at the time. We also reject the submission that the Judge predetermined the section 99 application. The Judge did not do so, either explicitly or implicitly.
The full terms of the Draft Management Agreement were not tendered in the Licensing Court. An objection was taken to this Court being apprised of the full terms of that Draft Management Agreement. Further, this Court was informed that the Draft Management Agreement had been superseded by an executed Management Agreement, the full terms of which also have not been disclosed. The non-disclosed terms may have some relevance in the overall consideration of the removal application and any section 99 application. The explanation for the non-disclosure was said to arise from commercial confidentiality. Any commercial confidentiality that exists could be protected by appropriate suppression orders rather than a tender of only part of the relevant document.
As earlier observed, section 53 provides the licensing authority with an unqualified discretion to grant or refuse an application under the Licensing Act on any ground, or for any reason if the licensing authority considers it sufficient, and further, that the licensing authority must refuse an application if satisfied that to grant the application would be contrary to the public interest. Section 53 also mandates that the licensing authority must make proper enquiry into the merits of any application. These provisions evidence the clear intention of the legislature to provide the licensing authority with the widest discretion to act in the public interest.
The Judge concluded that the application for removal should be refused. His reasons for doing so are encapsulated in the following paragraphs of his reasons for decision:[10]
[10] Hackham Community Sports & Social Club [2008] SALC 19 (28 November 2008, Chivell J) at [200]-[205].
In his written submissions, Mr Firth said:
A group of experienced and successful hoteliers in the poker machine industry have speculated and bought an expensive prominent main road site for a poker machine venture. They have also set up CMS and persuaded the Commissioner to let them help fund Club One which was set up by the Government’s amendments to the Gaming Machines Act, and in return get some priority access to additional gaming machine entitlements under that Act. They can use the entitlements temporarily in their own hotels to top up on the poker machine numbers reduction the Government forced on them (this applied only to hotels and not clubs).
Longer term, they are looking to rent their premises to a club or clubs, lend the money to them to renovate the rented premises, themselves get all the necessary planning and building approvals, and then get more gaming machines added to the existing gaming machine licence or licences, take over the running and management of the club’s operations and get approval to share in the profits. Using a club in this fashion circumvents the Government’s clear intention to penalise hotels and try to help clubs with amendments it has made to the Gaming Machines Act. (Pages 11-12)
I am not sure that it is accurate to say that the Government intended to “penalise” hotels by reducing the number of gaming machine entitlements, but I think it is true that there was an intention to assist clubs by not making a similar reduction in their entitlements. I agree with Mr Firth to the extent that it is apparent that it was not intended that the advantages thereby granted to clubs could be used to create hotels, in another guise, which have a competitive advantage over other hotels, thereby changing the existing balance between the various types of licence in the area.
In her written submissions, Ms Thompson pointed out that s49 of the LLA makes special provision for club licences. Relevant parts of s49 include:
(1)     A club licence may only be held by a club that is a non-profit association incorporated under the Associations Incorporation Act 1985.
(2)     …
(3)     …
In my opinion, the grant of this application would result in the creation of an entity that is a “club” only in name. In my view, this proposed facility will be much more in the nature of a professionally-operated hotel or tavern than a non-profit association or club. Mr Matthews made it clear that their plan was to compete successfully with the nearby Emu Hotel. He said: “…we want to knock off the Emu, I make no Bones about that” (T217).
An applicant for removal of a licence pursuant to s60 is not required to show that the needs of the public are not being provided for (s61(1)), as is required in relation to a hotel licence, or that demand is not being adequately catered for by existing licensed facilities, as is required in relation to a retail liquor merchant’s licence. There are various other ways in which the LLA places a lesser responsibility on the holder of a club licence compared with hotel and retial [sic] liquor merchant’s licensees.
In determining whether, in terms of s53(1a) of the LLA, the grant of the application would be contrary to the public interest, I have regard to the “principles and policies” in the Act, as Doyle CJ outlined in Liquorland v Lindsay Love [sic] (supra). In particular, I am satisfied that, for the reasons I have already expressed, to grant the application would allow the liquor industry to develop in a way which is not consistent with “the needs and aspirations of the community” (s3(1)(c)), and which, in the words of King CJ in Waiata v Lane (supra), would not lead to the “promotion and maintenance of a suitable balance between the various types of liquor facility available in a locality”.
A review of the oral evidence given at the hearing of the application and of the tendered exhibits, reveals that there was ample evidence to support the Judge’s findings, and in particular, his conclusion that the proposed facility would be more in the nature of a professionally operated hotel or tavern rather than a non-profit association or club. There was ample evidence to allow the conclusion that Club Management Services, in turn owned and controlled by a group of hoteliers, intended the Hackham Social Club at the relocated premises, to operate, in substance, as a professionally managed hotel so as to compete successfully with the nearby Emu Hotel. To adopt the oral evidence of the director of Club Management Services “we want to knock off the Emu, I make no bones about that”. It was the evidence of this director coupled with the terms of the Draft Management Agreement that would allow the conclusion that an attempt was being made to use the Hackham Social Club as a vehicle to circumvent the provisions of the Licensing Act with respect to the establishment of hotels.
The conclusions of the Judge that the application would not allow the liquor industry to develop in a way that was consistent with the needs and aspirations of the community, and that it would not lead to the promotion and maintenance of a suitable balance between the types of liquor facility available at a locality, were conclusions open on the evidence, and in our view, the appropriate conclusions.
We would dismiss this appeal.

WHITE J: Each of Hackham Community Sports & Social Club Incorporation (the Club) and Club Management Services (SA) Pty Ltd (CMS) appeal by permission to this Court against the refusal by the Licensing Court of an application made by the Club for the removal of the licence held by it to premises at Main South Road, Morphett Vale.
The circumstances giving rise to the appeal, and the legislative provisions relating to it, are set out in the joint reasons, and it is unnecessary to repeat them.
The Basis for the Judge’s Decision
The application for removal was made under s 60 of the Liquor Licensing Act 1997 (SA) (LLA). The Judge was satisfied that the Club had satisfied each of the conditions specified in s 60(1) and (2) of the LLA. However, the Judge refused the application in the exercise of the powers vested in him by s 53 of the LLA.
Section 53(1) and (1a) provide:
(1)Subject to this Act, the licensing authority has an unqualified discretion to grant or refuse an application under this Act on any ground, or for any reason, the licensing authority considers sufficient (but is not to take into account an economic effect on other licensees in the locality affected by the application).
(1a)An application must be refused if the licensing authority is satisfied that to grant the application would be contrary to the public interest.
It can be seen that s 53(1) vests a discretion in the licensing authority (the Court and the Commissioner) to grant or refuse an application made under the LLA (subject to one qualification) on any ground or for any reason which the authority thinks sufficient. Section 53(1a) qualifies the discretion further by requiring the authority to refuse an application if it is satisfied that to grant it would be contrary to the public interest. That is to say, the authority has no choice but to refuse an application if it is satisfied that to grant it would be contrary to the public interest. Under s 53(1), the discretionary judgment involved is exercised at the time when the Court, having considered the application on its merits, determines whether or not to make the order. To the extent that a discretionary judgment is involved under s 53(1a), it occurs at the time when the authority decides whether or not the grant of the application would be contrary to the public interest.
There are indications that the Judge may have relied on both s 53(1) and (1a) in his decision to refuse the Club’s application. In one passage the Judge appears to have concluded, in the terms of s 53(1a), that it would be contrary to the public interest to grant the removal application.
In determining whether, in terms of s 53(1a) of the LLA, the grant of the application would be contrary to the public interest, I have regard to the “principles and policies” in the Act, as Doyle CJ outlined in Liquorland v Lindsey Cove (supra). In particular, I am satisfied that, for the reasons I have already expressed, to grant the application would allow the liquor industry to develop in a way which is not consistent with “the needs and aspirations of the community” (s 3(1)(c)), and which, in the words of King CJ in Waiata v Lane (supra), would not lead to the “promotion and maintenance of a suitable balance between the various types of liquor facility available in a locality”.[11]
However, in the final paragraph of his reasons the Judge said:
For all the above reasons, in the exercise of my discretion, I refuse the application.[12]
The reference to “the exercise of my discretion” suggests that the Judge may have proceeded under s 53(1) as, for the reason earlier given, the final step under sub-s (1a) does not involve an exercise of discretion at all.
[11] In the Matter of an Application by Hackham Community Sports & Social Club [2008] SALC 19 at [205].
[12] Ibid at [210].
In some cases, the distinction to which I am drawing attention may be important in determining the matters which must be established on an appeal. Each of the judgments to be made under s 53(1) and (1a) may be discretionary judgments,[13] but they are discretionary judgments of different kinds. The matters which would have to be established on appeal in order to have the discretionary judgments overturned would be different, according to whether the decision was made under sub-s (1) or sub‑s (1a).
[13] Cf Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47 at [19]; (2000) 203 CLR 194 at 204-5.
In the present case, the grounds of appeal of the Club and of CMS indicate that each regarded the Judge’s decision as having been an exercise of discretion under s 53(1), and the appeal was presented on that view of the matter. Accordingly, I will address the appeal on the same basis. That does not mean that considerations of public interest are not relevant, as they may be pertinent to the exercise of the s 53(1) discretion.
The essential steps in the Judge’s decision to refuse the application for removal appear to be these:
(i)the Club satisfied the minimum conditions for an application for removal specified in s 60(1) and (2);[14]
(ii)the Management Agreement between the Club and CMS indicated that CMS would, if both the Management Agreement and the removal application were approved, exercise a substantial degree of control over the Club’s licenced facilities;[15]
(iii)the Management Agreement indicated that CMS would receive an undisclosed, but substantial, proportion of the profits derived from the operation of the facility;[16]
(iv)it was not the intention of Parliament when removing the limitations on the licensed trading activities of clubs, and when introducing the provisions concerning Club One into the Gaming Machines Act 1992 (SA) in 2004,[17] to create circumstances in which clubs could be used, in effect, to create hotels in another guise, with a competitive advantage over existing hotels, and a disturbance to the existing balance between the various kinds of licensed premises in a given area;[18]
(v)the grant of the Club’s application would result in the creation of an entity which would be a “club” in its name only, and the proposed facility would be more in the nature of a professionally operated hotel or tavern;[19]
(vi)the grant of the application would allow the liquor industry to develop in a way which was not consistent with the needs and aspirations of the community and would not lead to the promotion and maintenance of a suitable balance between the various types of liquor facility available in a locality;[20]
[14] In the Matter of an Application by Hackham Community Sports & Social Club [2008] SALC 19 at [173]-[174].
[15] Ibid at [191]-[198].
[16] Ibid at [196].
[17] Gaming Machines (Miscellaneous) Amendment Act 2004 (SA).
[18] In the Matter of an Application by Hackham Community Sports & Social Club [2008] SALC 19 at [201].
[19] Ibid at [203].
[20] Ibid at [205].
It was the matters stated in (iv) (v) and (vi), in particular, which led to the refusal of the application, but it is clear enough that the considerations stated in (ii) and (iii) informed the Judge’s conclusion about those matters.
Against that background, and the background contained in the joint reasons, I turn to the issues on the appeal.
What Applications Did the Judge Determine?
The Club submitted that the Judge had determined both its application for removal and the application filed by CMS for approval, under s 99 of the LLA, of a management agreement between it and CMS (the s 99 Application). This view of the matter was not supported by any other party to the appeal.
I respectfully disagree with the Club’s submission. It is clear that the Judge determined only the Club’s removal application.
The formal order prepared in the Licensing Court indicates that the Judge refused the application for removal of the Club licence only. That the Judge did not also determine the s 99 Application is further confirmed by the course of events which occurred in the Licensing Court and by the Judge’s reasons.
The Club filed its removal application on 5 July 2007. The hearing of that application commenced on 12 December 2007. It is not clear when CMS filed its s 99 Application but it was only referred by the Commissioner for hearing by the Licensing Court on 4 March 2008. On 25 March 2008, the Judge declined an application by the first respondent (Joperi) to “incorporate” the s 99 Application into the Club’s removal application proceedings. The Judge adjourned the hearing of that application to a date to be fixed and, at the same time, stipulated that that date would be after the determination of the Club’s removal application.
The Judge referred to these events in the reasons which he delivered on 28 November 2008.[21] Having referred twice to his adjournment of the s 99 Application, it is not to be supposed that the Judge nevertheless proceeded to determine it.
[21] Ibid at [6], [206].
It is true that the Judge did advert to the s 99 Application at the conclusion of his reasons, but it is apparent that he did so in order to explain why he considered it appropriate to determine the Club’s removal application without giving CMS any further opportunity to make submissions concerning the significance of the management agreement to the removal application.
I note that each of the notices of appeal indicate that it is only the Judge’s decision on the Club’s removal application which is the subject of appeal.
It does not seem that s 99 Application has yet been heard and determined in the Licensing Court. It remains open to CMS to seek a hearing of its application if, despite the Judge’s decision on the Club’s removal application, it considers it appropriate to do so.
The Relevance of the Management Agreement to the Exercise of the s 53 Discretion
Each of the Club and CMS contended that it had been inappropriate for the Judge to have any regard at all to the terms of the Management Agreement. Each contended that the terms of the Management Agreement were irrelevant to the exercise of the discretion under s 53(1).
CMS made two alternative submissions which were closely related to its submission concerning relevance. It contended that s 53 did not empower the Judge to refuse the removal application upon grounds which were to be determined expressly upon an application for approval separately provided for in s 99. In the alternative, it submitted that it had not been open to the Judge to refuse the removal application upon the ground that the Management Agreement impermissibly changed the “character” of the licensee, without considering the requirements for approval specified in s 99, and hearing CMS in relation to those requirements.
It is appropriate to say a little more about the history of the Management Agreement.
The Management Agreement
The Club and CMS first executed a management agreement in July 2007. On 8 August 2007, the solicitor for CMS provided a copy of that agreement to the Office of the Liquor and Gaming Commissioner (OLGC) and sought approval of it, under s 99(2) of the LLA, and under s 68(2)(b) of the Gaming Machines Act 1992 (SA) (GMA). In a meeting with the solicitors for CMS on 22 October 2007, the Deputy Commissioner raised concerns about a number of aspects of that agreement.
Following that meeting, the solicitors for CMS prepared a revised draft of the management agreement which sought to address the concerns of the Deputy Commissioner, and submitted it to the OLGC for approval in substitution for the earlier agreement.
On 14 December 2007, the Club adduced evidence from a director of CMS, Mr Matthews, in the Licensing Court in support of its removal application. Counsel for the Club led evidence from Mr Matthews concerning the then draft management agreement, and tendered a redacted form of it. During Mr Matthews’ evidence, the agreement was referred to as the draft management agreement and, when tendered, the document was described in that way.
On 13 March 2008 CMS and the Club executed a management agreement which was in the terms of the revised draft. The solicitor for CMS informed the Judge of that fact at the hearing on 25 March 2008 at which Joperi sought to have the s 99 Application heard and determined at the same time as the removal application. Despite the execution of the agreement, both the parties and the Judge have continued to refer to it as the draft management agreement. In these reasons, I will refer to it as the Management Agreement.
It is evident that the Licensing Commissioner had some concerns about the effect of the Management Agreement. Before referring it to the Court, he sought an opinion from the Crown Solicitor’s Office concerning it. Further, in his order, made under s 21(a) and (c) of the LLA, referring the s 99 Application to the Court for hearing and determination, the Commissioner said:
The Agreement goes far beyond what has been approved in the past, with CMS effectively running the proposed operation.
Although the s 99 Application indicated that approval of the Management Agreement was sought in relation to the Club’s existing premises at the corner of Doctors Road and States Road at Hackham, the terms of the Management Agreement make it plain that it related only to the premises which were the subject of the Club’s removal application, namely, 2 Wheatsheaf Road, Morphett Vale. The registered proprietor of those premises is Main South Road Pty Ltd (MSR). CMS has leased the premises from MSR.
The elements of the Management Agreement are these. The Club and CMS agreed to enter into a sub-lease of the Morphett Vale premises, and the Club agreed to establish a liquor, gaming and entertainment facility at those premises. The Club agreed to engage CMS to be the Project Manager of the necessary works involved in establishing the facility. Mr Matthews estimated that those development works would cost $1.5m to $2m. The Club agreed to seek the removal of the 15 gaming machine entitlements which it had at its Hackham Club Rooms to the premises at Morphett Vale. CMS agreed to procure another entity, Club One (SA) Pty Ltd (Club One), to enter into a “Host Club Allocation Agreement” with the Club with the effect that the Club could be allocated up to 25 additional gaming machine entitlements. The Club agreed to appoint CMS to manage the facility. In addition to a substantial lease payment, CMS was to be remunerated by a share of the profits from the facility, but the particular profit sharing arrangements were not disclosed to the Licensing Court, having been redacted from the copy of the draft management agreement which was tendered.
Although the Club and CMS contested the relevance of the Management Agreement, they did not (with one exception) contend that the Judge’s summary of its effect was erroneous. The Judge described the powers of CMS under the Management Agreement as “extremely wide”.[22] The powers of management of the facility vested in CMS meant that it would have total control of the daily operation of the facility, although the Club would retain all of the legal obligations placed upon licensees under the LLA and GMA.[23] The Judge regarded the dispute resolution mechanisms in the Management Agreement as being cumbersome and inadequate to enable the Club to exercise any control over the day-to-day management of the facility.[24] The Club contested this aspect of the Judge’s summary, but I am not satisfied that the Judge was wrong in that characterisation.
[22] Ibid at [191].
[23] Ibid at [194].
[24] Ibid at [192].
The Judge also considered that as between the Club and CMS there was an imbalance of experience, expertise, power and resources in favour of CMS and that this added to the degree of control which would, in reality, be exercised by CMS.[25]
[25] Ibid at [198].
The s 53 Discretion
The terms of s 53(1) emphasise the width of the discretion which it vests in the licensing authority. Section 53(1) describes the discretion as “unqualified”. Subject to the terms of the LLA, the licensing authority may grant or refuse an application on any ground, or for any reason, which the licensing authority considers sufficient (save only that it is not entitled to take into account an economic effect on other licensees in the locality affected by the application).
The nature of the discretion vested by s 61(1) of the Licensing Act 1967 (SA), a predecessor provision for s 53(1) of the LLA, was considered by King CJ in Waiata Pty Ltd v Lane.[26] Section 53 itself was considered by Doyle CJ in Liquorland (Australia) Pty Ltd v Lindsey Cove Pty Ltd.[27] Relevant passages from the respective reasons are set out in the joint reasons and it is not necessary to repeat them.
[26] (1985) 39 SASR 290 at 293-294.
[27] [2002] SASC 17 at [27]-[32]; (2002) 81 SASR 337 at 342-4.
It is possible to summarise some principles concerning the exercise of the s 53(1) discretion as follows:
(i)the discretion is at the heart of the liquor licensing system under the LLA and is not ancillary to the other sections of the Act;[28]
(ii)the discretion, although very wide, must be exercised judicially, for the purpose for which it was conferred, and in conformity with the legislative policy disclosed in the LLA;[29]
(iii)the primary purpose for which the discretion is conferred is the protection of the general public interest, as distinct from the public need or demand for liquor facilities, and the conditions under which they are to be provided;[30]
(iv)the discretion is the means by which the licensing authorities are enabled to promote the shaping and development of any orderly and harmonious system of liquor facilities designed not only to meet the public need for such facilities but also to protect the wider public interest in the preservation of the community from adverse social effects;[31]
(v)when exercising the discretion the Court is not confined to the grounds advanced by the parties, but may give effect to principles evident in the LLA itself, or which the licensing authority has itself developed for the attainment of the purposes of the LLA;[32]
(vi) subject to the proviso that the licensing authority may not take into account an economic effect on other licensees in the locality affected by the application, the authority may exercise the discretion to as to promote and maintain a suitable balance between the various types of liquor facility available in a locality;[33]
(vii)the discretion should be exercised bearing in mind that under the LLA considerations of proliferation of licences are less important than they once were.[34]
[28] Waiata at 295.
[29] Waiata at 294.
[30] Waiata at 294; Lindsey Cove at [27]; 342-3.
[31] Waiata at 294.
[32] Waiata at 295; Lindsey Cove at [28]; 343.
[33] Waiata at 295.
[34] Lindsey Cove at [29]; 343.
The s 53 Discretion and s 99
The appellants submitted that, despite the width of the s 53 discretion, the LLA evinced a legislative intention that issues of control by, or profit sharing with, an unlicensed person should be addressed in proceedings under s 99, and only in such proceedings. It was said that the Judge’s error lay in taking into account, in relation to the exercise of the s 53 discretion, matters which were to be addressed on a separate application.
The appellants’ submission raises the inter-relationship of s 53 and s 99 (the terms of which are set out in the joint reasons). Section 99(1) makes it an offence for a licensee to enter into certain kinds of arrangements with unlicensed persons, including arrangements which would permit an unlicensed person to exercise control or substantial influence over the business conducted under the licence (s 99(1)(e)), to manage the business (s 99(1)(d)), and to be remunerated by a share in the profits of the business (s 99(1)(c)). However, no offence is committed if the arrangement is approved by the Commissioner (s 99(6)(a)). The Commissioner may approve an arrangement if satisfied that the arrangement is likely to assist the liquor industry and industries with which it is closely associated, or is otherwise in the public interest, or that there is some other good reason for approving the arrangement, and the arrangement does not adversely effect the rights and reasonable expectations of persons presently in employment (s 99(2)).

The submission of the appellants was, in effect, that the specific provision in s 99 for the approval of arrangements with unlicensed persons, and the criteria to be considered under s 99(2) in relation to such arrangements, had the implied effect of excluding the matters which may be considered under that section from consideration under s 53(1). Reference was made to R v Wallis; ex parte Employers Association of Wool Selling Brokers,[35] Refrigerated Express Lines (A/Asia) Pty Ltd v Australian Meat and Live-Stock Corporation[36] and to Anthony Hordern & Sons Ltd v The Amalgamated Clothing & Allied Trades Union of Australia.[37] In the last of these cases, Gavan Duffy CJ and Dixon J said:
When the Legislature explicitly gives a power by a particular provision which prescribes the mode in which it shall be exercised and the conditions and restrictions which must be observed, it excludes the operation of general expressions in the same instrument which might otherwise have been relied upon for the same power.[38]
The appellants submitted that s 99 was the kind of particular provision to which Gavan Duffy CJ and Dixon J had referred. They submitted that this was confirmed by the words “subject to this Act” at the commencement of s 53(1) which indicated that s 53 was to be understood as operating subject to other provisions such as s 99.
[35] (1949) 78 CLR 529 at 550.
[36] (1980) 21 ALR 333 at 347.
[37] (1932) 47 CLR 1.
[38] Ibid at 7.
A number of matters count against acceptance of this submission. As already noted, the s 53(1) discretion is at the heart of the liquor licensing system. If it is to operate subject to other provisions, one would expect that to be said so expressly. The express qualifications in s 53 itself on the exercise of the discretion (the economic effect on other licensees, and the obligation to exercise the discretion in a particular way in one circumstance) tend to contra-indicate the implied exclusion of other matters from consideration under s 53. The words “subject to this Act” can be understood as indicating that the unqualified discretion is to be exercised subject to express stipulations in the LLA (such as sub-s (1a)), and is to be exercised having regard to the legislative policies discernible in the LLA.
The principle of statutory construction which the appellants seek to invoke has been considered most recently by the High Court in Minister for Immigration and Multicultural and Indigenous Affairs v Nystrom[39] in relation to ss 200, 201, and 501 of the Migration Act 1958 (Cth). Gleeson CJ said:
… The contention that ss 200 and 201 give a person in the position of the respondent a protection or immunity from the exercise of the power conferred by s 501 is a statement of a conclusion, rather than an expression of a reason for reaching that conclusion. If there is such a reason, it must be found in a process of statutory construction. The provisions of s 501(2), on the one hand, and ss 200 and 201 on the other, are not repugnant, in the sense that they contain conflicting commands which cannot both be obeyed, or produce irreconcilable legal rights or obligations. They create two sources of power, by which a person in the position of the respondent may be exposed, by different processes, and in different circumstances, to similar practical consequences. There is nothing novel, or even particularly unusual, about that. It does not of itself mean that only one source of power is available. If, however, by reason of the apparent exhaustiveness with which one provision, or group of provisions, dealt with the position of a person such as the respondent, there were an incompatibility of a kind that required a conclusion that only one provision or group of provisions was intended to apply, then that would be a reason for accepting the respondent’s contention. Again, if one provision, or group of provisions, were directed with particularity to the case of a person such as the respondent, and the other were merely of general application, the same could be said.[40] [Citations omitted]
Gummow and Hayne JJ said:
…[W]hat the cases reveal is that it must be possible to say that the statute in question confers only one power to take the relevant action, necessitating the confinement of the generality of another apparently applicable power by reference to the restrictions in the former power. In all the cases considered above, the ambit of the restricted power was ostensibly wholly within the ambit of a power which itself was not expressly subject to restrictions.[41]
[39] [2006] HCA 50; (2006) 228 CLR 566.
[40] Ibid at [2]; 571-2.
[41] Ibid at [59]; 589.
In my opinion, the LLA does not indicate the kind of incompatibility or necessity which these passages from Nystrom indicate is required.
The subject matter of a removal application is different from the subject matter of an application under s 99. The substance of the former is the merit or otherwise of a relocation of a licence from one set of premises to another. That involves, at the least, a consideration of the quality of the proposed premises and, in the discretion of the licensing authority, the nature of the business which the licensee proposes to conduct at those premises. An application under s 99 focuses on the merit or otherwise of proposed arrangements for control, or management, or remuneration, as the case may be, in relation to the business to be conducted under a licence. It does not follow that because those matters may be the subject of consideration on an application under s 99 that they cannot also be considered as an incident to the determination of an application commenced under some other provision of the LLA. Nor can I discern any necessary implication in the LLA to that effect. That is to say, the LLA does not disclose an intention that only one of its provisions provides the context in which issues arising from arrangements with an unlicensed person may be considered. [42]
[42] Cf Minister for Immigration and Multicultural and Indigenous Affairs v Nystrom [2006] HCA 50 at [2], [59]; (2006) 228 CLR 566 at 571-2; 589.
It is to be remembered that the prima facie position under s 99 is that the arrangements to which it refers are unlawful. They become lawful only if they are approved by the Commissioner or by the Court. The fact that they are made lawful is not conclusive of the issue of whether the relocation of a business conducted, or to be conducted, under those arrangements is, for example, in the public interest, or will enable the liquor industry to develop in a way which is consistent with the needs and aspirations of the community,[43] or does not detract from the amenity of community life.[44] Put more shortly, the resolution of the lawfulness of arrangements to which s 99(1) refers cannot be conclusive of the merit of other applications which may be made under the LLA in relation to businesses which are to be conducted under those arrangements, and there seems no reason why the resolution of the merit of, for example, a removal application, cannot take account of the same considerations which may arise under s 99.
[43] See the objects stated in s 3(1)(c) of the LLA.
[44] See the objects stated in s 3(1)(d) of the LLA.
I accept that if the licensing authority has, having regard to the criteria contained in s 99(2), approved arrangements made by a licensed person with an unlicensed person, it is unlikely that the same authority would take a contrary view of the same arrangements, when considering s 53. But that does not preclude the exercise of the discretion under s 53, by reference to matters which may be considered under s 99, at a time when an application under s 99 has not been determined.
The criteria to which the Commissioner is required to have regard under s 99(2) when considering an application under s 99(1) are expressed in general terms. Arrangements of the kind to which s 99(1) refers may be approved if they are likely to assist the liquor or associated industries, or it is in the public interest, or there is some other good reason to do so. The avoidance of an adverse effect on the rights and reasonable expectations of persons presently in employment to which s 99(2)(b) is a limitation on the Commissioner’s power under s 99(2) but not, in my opinion, of such a kind to indicate that arrangements with unlicensed persons may be considered only in the context of s 99.
The premise to the appellants’ submissions, namely, that issues of control by, or profit sharing with, an unlicensed person can be addressed only in proceedings under s 99, is contestable. Section 99(6)(a) provides that the prohibitions contained in s 99(1) do not apply to “an agreement or arrangement approved under subsection (2) or (4) or any other provision of this Act”. The words emphasised indicate a legislative intention that s 99 is not to be the sole source of power in a licensing authority to approve arrangements for the sharing of the control of, or the profits from, a licensed business. Section 97 which concerns the supervision and management of licensed premises may be one example of a provision to which s 99(6)(a) refers. Section 99(6)(a) makes it difficult to construe s 99 as a “particular provision which prescribes the mode in which it shall be exercised and the conditions and restrictions which must be observed”[45] to the exclusion of all other powers in the LLA concerning control and profit sharing arrangements.
[45] Anthony Hordern & Sons Ltd v The Amalgamated Clothing & Allied Trades Union of Australia (1932) 47 CLR 1 at 7.
Acceptance of the appellants’ submissions would require the licensing authority to engage in some artificiality in the determination of a removal application. In the present case, on the appellants’ submission, the licensing authority could consider the Management Agreement to the extent that it was necessary to do so to assess matters such as the size, quality, layout and style of the proposed premises, the number of gaming machine entitlements which may be accommodated within it, the tenure arrangements for the Club at the premises, the ability of the Club to comply with the requirements of the LLA, and the circumstances which would exist at the conclusion of the Club’s tenure, but it could not do so in relation to the issue of control. Given the very wide scope of the s 53 discretion, it would be inappropriate, in my opinion, to adopt a construction of the LLA which would require this level of artificiality.
For these reasons, I do not consider that the Judge erred by having regard to the terms of the Management Agreement and, in particular, by having regard to the control which CMS could exercise over the proposed business. This conclusion is also sufficient to determine the first of the two alternative submissions made by CMS.
It seemed at first sight paradoxical that the Club which had tendered the draft management agreement, and led evidence about it, in support of its removal application, should now contend that it was not relevant to the determination of that application. However, I accept that the Club did so with a view to allaying a concern raised by the Judge about the “true” applicant, and without necessarily accepting that the terms of the agreement were necessarily relevant for any wider purpose.
The second alternative submission made by CMS was to the effect that it had not been open to the Judge to refuse the removal application upon the ground that the Management Agreement impermissibly changed the “character” of the licensee, without considering the requirements for approval specified in s 99, and hearing CMS in relation to those requirements. I will address CMS’ complaint that the Judge denied procedural fairness shortly. The first part of this submission by CMS seems to imply that, had the Judge had regard to s 99(2), he may have reached a different conclusion. I do not accept that view of the matter. In my opinion, it is implicit in the Judge’s reasons that he considered the removal application on a basis favourable to the Club, namely, that the s 99 Application would succeed. Unless the Judge had acted on that basis, it is highly unlikely, in my opinion, that he would have concluded that the grant of the Club’s application “would result in the creation of an entity that is a ‘Club’ only in name” and that it would “be much more in the nature of a professionally-operated hotel or tavern than a non-profit association or club”.
For these reasons, I conclude that the appellants have not made good their contention that the Judge erred in having regard to the terms of the Management Agreement in coming to his conclusion concerning the Club’s removal application.
Did the Judge Consider that Licensed Clubs could not be Commercial, Professionally Operated and Profit Oriented?
The Club submitted that the Judge had erred in his approach to licensed clubs by introducing the notion that a club cannot be commercial, professionally operated, and profit-oriented without changing the essential character of the entity. In this respect the Club referred to paragraph [203] of the Judge’s reasons in which the Judge said:
In my opinion, the grant of this application would result in the creation of an entity that is a “club” only in name. In my view, this proposed facility will be much more in the nature of a professionally-operated hotel or tavern than a non-profit association of club. Mr Matthews made it clear that their plan was to compete successfully with the nearby Emu Hotel. He said: “… we want to knock off the Emu, I make no bones about that” (T217).
In support of this submission, the Club drew the Court’s attention to a number of changes in the legislative provisions relating to clubs. It is not necessary to trace the history of those changes. It is sufficient to note that s 36 of the LLA now permits the holder of a club licence to sell liquor in circumstances which are almost, but not quite, identical to those applicable to hotel licences.
In my respectful opinion, the Judge did not make the error which the Club attributes to him. In particular, the Judge did not proceed on an assumption that it was inconsistent with the nature of a club for it to operate licensed premises which were commercial, professionally operated and profit-oriented. Instead, the Judge was expressing a conclusion about one feature of the Club’s proposal which, together with other features, led him to conclude that the s 53(1) discretion should be exercised adversely to the Club.
The passage which is impugned by the Club was part of the Judge’s conclusion that the removal application was really part of an initiative to establish a facility in the nature of a commercial tavern approximately 100 metres from the Emu Hotel on Main South Road without having to establish, as required by s 58 of the LLA, that the grant of a licence for a tavern was necessary in order to provide for the needs of the public in that locality. In addition, the passage was part of the Judge’s conclusion that the initiative was not primarily for the purposes of promoting the interests of the Club, as a club. That conclusion was amply justified by the evidence.
The Club had existing licensed premises at the corner of Doctors Road and States Road, Hackham, adjacent to the Hackham oval. Each of the sports and social clubs which it supported were based at the same location, and made use of the facilities at the oval.
MSR purchased the Morphett Vale premises in August 2005 at a price of $1.65m dollars because, in Mr Matthews’ words, it wanted to be able to “take advantage of the commercial opportunities” which it saw arising from the introduction of s 24A of the GMA concerning Club One.[46] Mr Matthews’ said that MSR had been holding the land (“banking it”) since August 2005.
[46] Section 24A was incorporated into the GMA by s 11 of the Gaming Machines (Miscellaneous) Amendment Act 2004 (SA)which came into operation on 1 February 2005.
The shareholders and directors of MSR are a number of well-known hoteliers. The ultimate ownership of the shares in CMS is substantially, but not wholly, identical with the shareholding of MSR.
CMS and MSR conceived the idea of a club establishing a facility at the Morphett Vale premises and removing its gaming machine entitlements and liquor licence to those premises. In January 2008, CMS made a proposal to that effect to the Club.
The shareholding and directorship of Club One was not disclosed in the evidence, but it seems from the terms of the Management Agreement that CMS was in a position by which it could procure the placement by Club One of up to a further 25 gaming machine entitlements to the Morphett Vale premises.
The motivation of CMS and MSR was undoubtedly commercial. Mr Matthews said:
We think South Road is a great site. We know that the Emu is in the top handful of venues in the State. It is a good site. It is a highly desirable site. There is no doubt about that. Our main competition – we want to knock off the Emu, I make no bones about that.
Mr Matthews identified CMS, the Club and Club One as being the entities which had the intention “to knock off” the Emu.
In my opinion, the Judge’s conclusion, on the basis of this evidence, about the nature of the proposed facility was part of his characterisation of the total proposal. That characterisation was one feature which led him to conclude that the removal application would result in a development which was not consistent with the needs and aspirations of the community. The Judge did not conclude that facilities operated by a club may not be commercial, professionally operated and profit-oriented but, as I have said, considered that the overall commercial purpose of the proposal was one factor to be taken into account in considering the merit of the application. I note in addition that the Judge expressly accepted that the Club One concept was developed so as to permit licensed clubs to compete more effectively with the hotel industry.[47]
[47] In the Matter of an Application by Hackham Community Sports & Social Club [2008] SALC 19 at [37].
Accordingly, this ground of appeal does not succeed.
Did the Judge Deny CMS Procedural Fairness?
CMS contended that the assessment by the Judge of the Management Agreement pre-empted the determination of the s 99 application, rendering it futile, and thereby directly interfered with CMS’ commercial interests in managing the business of the Club under the terms of a management agreement. CMS claimed that it had a reasonably held legitimate expectation that the Management Agreement would be assessed in the hearing of the s 99 application, and not in the removal application. It claimed a legitimate expectation that its right to apply for approval of the Management Agreement under s 99 would not be pre-empted or pre-determined in the determination of the removal application.[48]
[48] Haoucher v Minister for Immigration & Ethnic Affairs (1990) 169 CLR 648 at 681-2; Annetts v McCann (1990) 170 CLR 596 at 598-600; Re Minister for Immigration and Multicultural and Indigenous Affairs: Ex parte Lam [2003] HCA 6 at [48]; (2003) 214 CLR 1 at 16-17; Minister for Immigration & Ethnic Affairs v Kurtovic (1990) 21 FCR 193 at 224-5.
In support of the claimed legitimate expectation, CMS relied upon an affidavit of its solicitor. The solicitor deposed to his experience with previous applications for approval under s 99. Such applications are commonly dealt with informally and it was usual for there to be some discussion between the OLGC and the applicant in which any concerns of the Commissioner concerning the agreement would be identified, and the applicant then given an opportunity to address them. That is what occurred when CMS first submitted its management agreement with the Club for approval.
The solicitor deposed to his belief at the time when the Court declined Joperi’s application that it hear and determine the s 99 application at the same time as the removal application, and adjourned the hearing of it to a date to be fixed after the determination of the removal application. He said that he believed and expected that the role of CMS in the management of the Morphett Vale facility, and the appropriateness or otherwise of the terms of the revised draft management agreement would arise for consideration, if at all, on the hearing of the s 99 application and not in the hearing of the removal application. In addition, the solicitor said that he expected, in accordance with the practice and procedure adopted by the OLGC, that CMS would be given an opportunity to meet any concerns about the appropriateness of the terms of the draft management agreement which may be expressed by the Court upon the hearing of the s 99 application.

In my respectful opinion, the matters deposed to by the solicitor do not give rise to the kind of legitimate expectation contemplated by the authorities. In the first place, the previous experience to which the solicitor deposed related to applications under s 99 which were determined by the Commissioner, and not by the Court. The solicitor said that his experience was that “these applications have always been dealt with by the Commissioner”. There was no evidence of a practice by the Court in relation to applications under s 99 which could give rise to an expectation of the kind claimed by the solicitor.
The Court was not bound by the practice of the Commissioner and the latter’s practice could not give rise to an expectation of the way in which the Court would proceed. It is to be expected that greater informality is possible in practice in relation to those applications determined by the Commissioner as such determinations are administrative in character. In contrast, even though the decisions of the Licensing Court may be informed by public policy and public interest considerations,[49] and even though there may be “an unmistakably administrative element”[50] in the functions vested in it, it is a court exercising judicial power. The difference in character between the powers exercised by the Commissioner on the one hand, and the jurisdiction exercised by the Court, on the other, together with the absence of any previous practice by the Court in considering applications under s 99 means that there was not “some undertaking, policy guideline or course of conducting hearings by the decision-maker”[51] which could give rise to the legitimate expectation claimed by CMS.
[49] K-Generation Pty Ltd v Liquor Licensing Court [2009] HCA 4 at [82]; (2009) 83 ALJR 327 at 343.
[50] Waiata Pty Ltd v Lane (1985) 35 SASR 290 at 295.
[51] Minister for Immigration & Ethnic Affairs v Kurtovic (1990) 21 FCR 193 at 224.
I accept that the solicitor may have believed that the Management Agreement would be addressed, as appropriate, by the Licensing Court in the hearing and determination of the s 99 application. However, I do not accept that CMS could have believed, reasonably, that the Management Agreement would not be considered, insofar as it was relevant to do so, in relation to the removal application. CMS was aware that the draft management agreement had been the subject of considerable attention in the evidence before the Judge. Its director, Mr Matthews, had attended to give evidence concerning it. The solicitor for CMS had been given leave to appear in the proceedings to protect the interests of CMS and, for at least part of the evidence of Mr Matthews, had exercised that leave. In addition, a considerable amount of the cross-examination of Ms Donaghay, the Secretary and Manager of the Club, had been directed to the arrangement which it had with CMS. Neither the Club nor CMS pointed to any statement or other indication by the Judge to the effect that he would not have regard at all to this substantial body of evidence, or that he would do so in only a limited way, or for a limited purpose.
I note that the solicitor for CMS does not depose to a belief on his part that the Management Agreement would not be considered by the Judge, to the extent that it was appropriate to do so, in his determination of the removal application.
There are some statements in some authorities to the effect that it is desirable for trial judges, when sitting without a jury, to give some indication of their views about the issues, problems and technical difficulties which they perceive in the litigation before them,[52] and perhaps to give their tentative views about those issues.[53] It is said that to do so enables the parties to direct their submissions to those issues and to correct any misapprehension which the judge may have regarding them. It may also permit a party to adduce further evidence. However, the conventional position is that stated by Lord Diplock in Hoffmann-La Roche & Co v Secretary of State for Trade and Industry:
Even in judicial proceedings in a court of law, once a fair hearing has been given to the rival cases presented by the parties the rules of natural justice do not require the decision-maker to disclose what he is minded to decide so that the parties may have a further opportunity of criticising his mental processes before he reaches a final decision. If this were a rule of natural justice only the most talkative of judges would satisfy it and trial by jury would have to be abolished.[54]
This passage was cited with approval by the High Court in SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs.[55]The High Court added that:
Procedural fairness does not require the Tribunal to give the applicant a running commentary upon what it thinks about the evidence that is given. On the contrary, to adopt such a course would be likely to run a serious risk of conveying an impression of pre-judgment.[56]
In the light of these authoritative statements, CMS could not have had a legitimate expectation that the Judge would inform it of any preliminary or tentative view which he reached concerning the Management Agreement. This is another indication that CMS could not have had the kind of legitimate expectation required by the authorities in the context of a claim of denial of procedural fairness.
I would reject the claim of a denial of procedural fairness.
[52] Vakauta v Kelly (1989) 167 CLR 568; Galea v Galea (1990) 19 NSWLR 263 at 279.
[53] Antoun v The Queen [2006] HCA 2 at [31]-[32]; (2006) 80 ALJR 497 at 504; Escobar v Spindaleri (1986) 7 NSWLR 51 at 55.
[54] (1975) AC 295 at 369.
[55] [2006] HCA 63 at [48]; (2006) 81 ALJR 515 at 523.
[56] Ibid. See also Auton v Australian Prudential Regulation Authority [2003] FCA 346 at [66]-[68]; Robb & Dale v Chief Commissioner of Police [2005] VSC 310 at [70].
Conclusion
For the reasons given above, I would dismiss the appeal.