Independent Liquor and Gaming Authority v Auld

[2019] NSWCA 88

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation:	Independent Liquor and Gaming Authority v Auld [2019] NSWCA 88
Hearing dates:	19 March 2019
Decision date:	01 May 2019
Before:	Macfarlan JA at [1]; White JA at [2]; Sackville AJA at [16]
Decision:	1.   Grant the Authority leave to appeal from the decision of the Appeal Panel. 2.   Direct the Authority to file a notice of appeal in the form of the draft notice of appeal within seven days. 3.   Allow the appeal. 4.   Set aside Order 1 made by the Appeal Panel on 27 July 2018 and the Orders made by the Tribunal on 30 January 2018. 5.   In lieu thereof, order that the decision of the Authority to refuse Application number 1-4557301491 for the removal of the Licence from the Mill Tavern to premises within the ALDI supermarket be affirmed.
Catchwords:	LIQUOR LAW – Licensing – Removals – Statutory construction – Whether s 59 of the Liquor Act 2007 (NSW) authorised the Independent Liquor and Gaming Authority to grant a removal application that converted a hotel licence to a packaged liquor licence LIQUOR LAW – Licensing – Removals – Statutory construction - Whether s 53 of the Liquor Act 2007 (NSW) authorised the Authority to impose conditions on a hotel licence on a removal application so that it operates as if it were a packaged liquor licence – Whether a business operating under such a licence is compatible with the hotel primary purpose test in s 15(1) of the Liquor Act 2007 (NSW)
Legislation Cited:	Administrative Decisions Review Act 1997 (NSW) Civil and Administrative Tribunal Act 2013 (NSW) Gaming and Liquor Administration Act 2007 (NSW) Liquor Act 2007 (NSW) Supreme Court Act 1970 (NSW) Gaming and Liquor Administration Regulation 2016 (NSW) Gaming and Liquor Administration Regulation 2008 (NSW)
Cases Cited:	Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41 Auld v Independent Liquor and Gaming Authority [2018] NSWCATAD 25 B&L Linings Pty Ltd v Chief Commissioner of State Revenue (2008) 74 NSWLR 481; [2008] NSWCA 187 Be Financial Pty Ltd as Trustee for Be Financial Operations Trust v Das [2012] NSWCA 164 Certain Lloyd’s Underwriters v Cross (2012) 248 CLR 378; [2012] HCA 56 Henroth Investments Pty Ltd v Sydney North Planning Panel [2019] NSWCA 68 Independent Liquor and Gaming Authority v Auld [2018] NSWCATAP 184 Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11 Pierce v Liquor Licensing Commission (1987) 22 47 SASR 22 Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue of the State of Victoria (2001) 207 CLR 72; [2001] HCA 49 The Queen v Australian Broadcasting Tribunal; Ex parte Hardiman (1980) 144 CLR 13; [1980] HCA 13 Wesiak v D&R Constructions (Aust) Pty Ltd [2016] NSWCA 353
Texts Cited:	Shorter Oxford English Dictionary
Category:	Principal judgment
Parties:	Independent Liquor and Gaming Authority (Applicant) Trent Auld (Respondent)
Representation:	Counsel: Ms NL Sharp SC / Ms D Forrester (Applicant) Mr TG Howard SC / Ms CM Novak (Respondent)   Solicitors: Crown Solicitor’s Office (Applicant) Hatzis Cusack Lawyers (Respondent)
File Number(s):	2018/261007
Decision under appeal	Court or tribunal: NSW Civil and Administrative Tribunal Jurisdiction: Appeal Panel Citation: [2018] NSWCATAP 184 Date of Decision: 27 July 2018 Before: Wright J (President); Hennessy LCM (Deputy President); M Harrowell (Principal Member) File Number(s): AP 18/10365

HEADNOTE

[This headnote is not to be read as part of the decision]

On 14 December 2016 the Independent Liquor and Gaming Authority (Authority) refused an application made by Mr Auld under s 59(1) of the Liquor Act 2007 (NSW) to remove a hotel liquor licence from the Mill Tavern in Young to a nearby ALDI supermarket. ALDI sought the licence to sell packaged liquor by retail during opening hours from a discrete section of the store.

On 20 January 2017 Mr Auld sought administrative review of the Authority’s decision pursuant to s 13A of the Gaming and Liquor Administration Act 2007 (NSW). The matter was heard by a Senior Member of the New South Wales Civil and Administrative Tribunal (NCAT) who set aside the Authority’s decision and approved Mr Auld’s removal application, but with conditions on the licence so that the supermarket would only sell packaged liquor. Following this decision, the Authority appealed to the NCAT Appeal Panel. The NCAT Appeal Panel dismissed the Authority’s appeal.

The Authority then sought leave from the Court of Appeal, pursuant to s 83(1) of the Civil and Administrative Tribunal Act 2013 (NSW), to appeal on questions of law from the decision of the NCAT Appeal Panel.

Granting leave and allowing the appeal Sackville AJA (White JA and Macfarlan JA agreeing) held:

1. The Appeal Panel erred in law in concluding that s 59 of the Liquor Act 2007 (NSW) authorised the Authority to approve the removal application by granting a removal application that converted the hotel licence into a packaged liquor licence.

The Authority, in the exercise of the power conferred by s 59, could not change the licence type when approving a removal application. If the Authority purported to do so, it would not be granting approval to remove the licence to new premises, but would be approving the grant of a new type of licence in respect of the new premises which is not contemplated on the proper construction of s 59. It is implicit in the concept of “removal” that the licence retains its character as a particular type of licence even after removal to new premises. It is the actual licence that is to be removed that the authority must endorse: [95], [98]-[102].

Considered: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27; [2009] HCA 41 at [47]; Certain Lloyd’s Underwriters v Cross (2012) 248 CLR 378; [2012] HCA 56 at [24]-[25].

1. The Appeal Panel erred in concluding that the ALDI supermarket business would satisfy the hotel primary purpose test if it conducted its liquor sales under a hotel licence subject to conditions such that it resembled a packaged liquor licence

It is implicit in Part 3 Div 2 of the Liquor Act 2007 (NSW) that the business carried out on the licensed premises pursuant to a hotel licence must have certain characteristics. A hotel will not have the requisite character unless it is conducted on a licensed premises which has a hotel licence permitting the sale or supply of liquor both for the purpose of consumption on the licensed premises and away from the licensed premises. The test can be satisfied only if the business carried out on the licensed premises has the primary purpose of selling liquor by retail and the business is entitled to sell liquor for consumption on the premises: [107], [112], [115].

The business proposed to be conducted on the new ALDI premises could not satisfy the hotel primary purpose test. Although the primary purpose of the proposed business was the sale of liquor by retail, the business was neither intended to sell nor entitled to sell liquor for consumption on the premises: [116].

Considered: Pierce v Liquor Licensing Commission (1987) 47 SASR 22 at [23].

The hotel primary purpose could not, as it was held by the Appeal Panel, be circumvented by an exercise of the Authority’s power under s 94 of the Act to specify the boundaries of the licensed premises because this would be contrary to the requirements envisaged by s 30 of the Act if a packaged liquor licence had instead been granted to the ALDI premises: [4]-[9] (per White JA additionally).

The Appeal Panel’s reasoning would also run contrary to the clear legislative intent manifest in s 31 of the Act that packaged liquor is not to be sold from service stations, take-away food shops, and (subject to limited qualifications) general stores: [10]-[12] (per White JA additionally).

1. Notice of contention

Mr Auld argued that the NCAT Appeal Panel gave insufficient weight to the prejudice occasioned to Mr Auld by the Authority relying on an argument not presented to the Senior Member when before the Appeal Panel. The Court of Appeal found the NCAT Appeal Panel specifically addressed this argument and gave cogent reasons to reject it. There was nothing to prevent Mr Auld from seeking leave to amend his application on the appeal, and there was nothing to prevent ALDI lodging a fresh application for a packaged liquor licence in respect of the supermarket. From this, no error was established to the Appeal Panel’s exercise of discretion to allow the Authority’s question of construction to be raised for the first time on the appeal: [85].

Orders

The Court of Appeal set aside Order 1 made by the NCAT Appeal Panel on 27 July 2018 and the Orders made by NCAT on 30 January 2018. In lieu thereof, the Court ordered that the decision of the Authority to refuse Application number 1-4557301491 for the removal of the Licence from the Mill Tavern to premises within the ALDI Supermarket be affirmed: [123].

Judgment

1. MACFARLAN JA: I agree with Sackville AJA.

2. WHITE JA: I have had the advantage of reading in draft the reasons for judgment of Sackville AJA. I agree with those reasons and with the orders his Honour proposes. My additional reasons for concurring with the orders proposed by Sackville AJA assume familiarity with his Honour’s judgment.

3. In my view there are two additional reasons as to why the Appeal Panel erred in concluding that the Authority had power to approve the removal application of Mr Auld’s hotel licence to the ALDI supermarket. The first reason concerns the statutory intention expressed in s 30 of the Liquor Act. The second concerns s 31 of that Act. Both sections are quoted in Sackville AJA’s reasons at [34].

Section 30

4. The removal application stated that the proposed licensed premises would comprise an area of only some 33m². A plan attached to the removal application identified the “licensed area” as being the 33m² inside the ALDI supermarket which was to be partitioned and have its separate checkout.

5. On the basis that on approval of the removal application the hotel licence would apply only to licensed premises of 33m² the respondent could and did submit that the hotel primary purpose test in s 15(1)(a) of the Liquor Act (quoted by Sackville AJA at [30]) was satisfied. If the licensed premises were the whole of the supermarket, the hotel primary purpose test would not be satisfied.

6. Section 94 of the Liquor Act provides that the boundaries of licensed premises are to be specified by the Authority when the licence is granted, but those boundaries may be changed by the Authority, either on the Authority’s own initiative, or on the application of the owner of the premises or the licensee. Hence, Mr Auld submitted that on his application the Authority could change the location and boundaries of the licensed premises.

7. The Appeal Panel held that as the appeal to it was limited to a question of law and no leave to appeal on a ground other than a question of law had been sought, there was no basis to challenge what was said to be a finding of the Tribunal that the proposed licensed premises would comprise that part of the ALDI supermarket designated as the packaged liquor section with display shelving and a checkout area. The Appeal Panel observed in any event that a challenge to that finding was bound to fail (Appeal Panel reasons [208]).

8. The difficulty with designating the licensed premises to which the removed hotel licence related as being the 33m² of the liquor area within the ALDI supermarket is that such a designation would be contrary to the requirements of s 30 of the Liquor Act if a packaged liquor licence were sought for a supermarket. Section 30(1) treats “the premises to which a packaged liquor licence relates” as the licensed premises. Where the primary purpose of the business carried out on those premises is not the sale of liquor for consumption away from the licensed premises, then the liquor must be sold in the area designated as the liquor sales area which must be separated from the other parts of the premises in which other activities are carried out.

9. A packaged liquor licence authorises the licensee to sell liquor by retail in sealed containers on the licensed premises for consumption away from the licensed premises. If an application were made for a packaged liquor licence, the licence could not be granted on the basis that the licensed premises were the liquor sales area, rather than the supermarket. Liquor would have to be sold for consumption away from the supermarket, not merely for consumption away from the liquor sales area.

Section 31

10. Section 31 of the Liquor Act (quoted by Sackville AJA at [34]) prohibits the granting of a packaged liquor licence for premises that comprise a general store (as defined), unless the Authority is satisfied of the matters in s 31(1)(a) and (b). There is no equivalent provision restricting the grant of a hotel licence.

11. If the Appeal Panel’s conclusion were correct, a hotel licensee could apply for the removal of a hotel licence to premises comprising a general store and for the imposition of conditions appropriate for a packaged liquor licence, irrespective of whether the grant of a packaged liquor licence to the very same premises was precluded by s 31. It is by no means clear that the Authority could refuse the application on the ground that s 31 would preclude the grant of a packaged liquor licence, if what was sought was approval for the removal of a hotel licence and the imposition of conditions on that licence. Even if the Authority could rely on this ground, the statutory prohibition in s 31 would be evaded and would be replaced by a general discretion on the part of the Authority to have regard to such matters in deciding whether or not to approve the removal of a hotel licence.

12. The case is even plainer when s 31(2) is considered. Subsection (2) provides that a packaged liquor licence must not be granted for premises comprising a service station (as defined) or a take-away food shop (as defined). The clear legislative intent is that liquor is not to be sold on such premises. Yet on the Appeal Panel’s reasoning, it would be possible for an application to be made for the removal of a hotel licence to such premises, but to be subject to conditions appropriate to a packaged liquor licence. Again, the statutory prohibition could be evaded, to be replaced by the exercise of discretion by the Authority.

13. The construction of the Liquor Act adopted by the Appeal Panel that the character of the removed hotel licence could effectively be changed by the imposition of conditions that gave it effect as a packaged liquor licence, is inconsistent with the intended operation of ss 30 and 31.

14. Contrary to the view of the Appeal Panel, the Authority could not have dealt with the application for removal of the hotel licence as if it were an application for the grant of a packaged liquor licence and granted that application. It was because the Appeal Panel considered that that course would be open to the Authority that it also considered that what could be done directly could be done indirectly by the imposition of conditions (Appeal Panel’s reasons at [105] (see per Sackville AJA at [60])).

15. For these reasons and for the reasons of Sackville AJA the appeal should be allowed and the other orders proposed by Sackville AJA should be made.

16. SACKVILLE AJA: These proceedings arise out of the refusal of the applicant (Authority) to grant an application by the respondent (Mr Auld) to remove a hotel licence (Licence) from the Mill Tavern in Young to the ALDI Supermarket (Supermarket), about 400 metres away. Mr Auld made the application pursuant to s 59(1) of the Liquor Act 2007 (NSW) (Liquor Act) which allows a licensee to apply to the Authority for approval to remove the licence to premises other than those specified in the licence. ALDI wishes to use the Licence to sell packaged liquor by retail during opening hours from a discrete section of the Supermarket.

17. The Authority seeks leave to appeal on a question of law from a decision of the Appeal Panel of the Civil and Administrative Tribunal of New South Wales (Tribunal). [1] The Authority contends that the Appeal Panel erred in law in dismissing an appeal from a decision of the Tribunal constituted by a Senior Member. The Tribunal set aside the Authority’s decision and approved Mr Auld’s application to remove the Licence from the Mill Tavern to the Supermarket, but provided for conditions to be imposed on the Licence so that the outlet in the Supermarket would sell only packaged liquor. [2]

    1. Independent Liquor and Gaming Authority v Auld [2018] NSWCATAP 184 (Appeal Decision).

    2. Auld v Independent Liquor and Gaming Authority [2018] NSWCATAD 25 (Tribunal Decision).

18. The application for leave to appeal is brought pursuant to s 83(1) of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act). Section 83(1) permits a party to an “internal appeal”, with the leave of the Supreme Court, to appeal on a question of law from any decision made by an Appeal Panel. [3] The application for leave to appeal was heard concurrently with argument on the appeal.

    3. The appeal is assigned to the Court of Appeal because the Appeal Panel included Wright J as President: Supreme Court Act 1970 (NSW), s 48(1)(a)(vii), (2)(f). As to the nature of the “appeal” see at [79] below.

19. As indicated above, Mr Auld is the respondent to the appeal. However, Mr Howard SC, who appeared with Ms Novak for Mr Auld, frankly stated at the outset of his oral submissions that his instructing solicitors had acted at all stages in the interests of ALDI as well.

20. There was some discussion in this Court concerning the Authority’s role in actively challenging the decision of the Appeal Division. [4] Mr Howard explained that Mr Auld was not in a position to take any point about the Authority playing an active part in the proceedings because Mr Auld had successfully opposed an application by the Authority to join the Secretary of the Department of Justice as a party to the proceedings in the Tribunal. In the light of that opposition the Authority was the only party able to appeal to the Appeal Panel from the decision of the Tribunal and to seek leave to appeal in this Court from the Appeal Decision. [5]

    4. See The Queen v Australian Broadcasting Tribunal; Ex parte Hardiman (1980) 144 CLR 13; [1980] HCA 13 at 35-36 per curiam; Oshlack v Richmond River Council (1998) 193 CLR 72; [1998] HCA 11 at [12] (Gaudron and Gummow JJ).

    5. Henroth Investments Pty Ltd v Sydney North Planning Panel [2019] NSWCA 68 at [55]-[56] per curiam.

Liquor Act

21. As the arguments on the appeal raise issues of construction of the Liquor Act, it is convenient to set out the most important provisions of the legislation. The provisions set out or described below are those in force at the time the Authority made its decision and the Tribunal set aside that decision.

General provisions

22. The objects of the Liquor Act are stated in s 3(1) as follows:

(a)   to regulate and control the sale, supply and consumption of liquor in a way that is consistent with the expectations, needs and aspirations of the community,

(b)   to facilitate the balanced development, in the public interest, of the liquor industry, through a flexible and practical regulatory system with minimal formality and technicality,

(c)   to contribute to the responsible development of related industries such as the live music, entertainment, tourism and hospitality industries.

23. A person must not sell liquor unless authorised to do so by a licence (s 7(1)). A person must also not open, keep or use any premises for the purpose of selling liquor unless the premises are licensed premises (s 8(1)).

24. Part 3 of the Liquor Act deals with “Liquor licences”. Section 10 provides as follows:

Types of licences and authorisation conferred by licence

(1)   The following types of licences may be granted and held under this Act:

(a)    hotel licence,

(b)     club licence,

(b1)     small bar licence,

(c)     on-premises licence,

(d)     packaged liquor licence,

(e)     producer/wholesaler licence,

(f)     limited licence.

(2)   A licence authorises the licensee to sell or supply liquor in accordance with this Act and the conditions of the licence.

(3)   The authorisation conferred by a licence is subject to this Act and the regulations.

25. Section 11 states as follows:

(1)   A licence is subject to:

(a)   such conditions as may be imposed, or are taken to have been imposed, by the Authority … (whether at the time the licence is granted or at any later time) under this Act, and

(b)   such conditions as are imposed by this Act or prescribed by the regulations, and

(c)   such other conditions as are authorised to be imposed on the licence under this Act.

…

(2)    A licensee must comply with any conditions to which the licence is subject.

(3)   For the purposes of this Act, a condition to which a licence is subject includes any provision of this Act that imposes a requirement or restriction (other than as an offence) on or in relation to the licence, licensee or licensed premises concerned.

Note. The times during which licensed premises are authorised to trade is an example of such a requirement.

26. Each of the seven types of licence identified in s 10 is dealt with in a separate Division of Part 3. Most importantly for present purposes, Div 2 (ss 14-17) specifies the requirements for hotel licences and Div 5 (ss 29-31) specifies the requirements for packaged liquor licences.

Hotel licences

27. Section 14(1) of the Liquor Act (within Div 2) states that:

A hotel licence authorises the licensee to sell liquor by retail on the licensed premises for consumption on or away from the premises.

28. The following definitions in s 4(1) of the Liquor Act are relevant to s 14(1) for present purposes:

hotel means the premises to which a hotel licence relates.

licence means a licence under this Act.

licensed premises means the premises to which a licence relates.

licensee means the holder of a licence.

premises includes:

(a)   a building or structure, or

(b)   land or a place (whether built on or not), or

(c)   …

29. Section 14(2) specifies the times when liquor may be sold for consumption on the licensed premises as follows:

The times when liquor may be sold for consumption on the licensed premises are as follows:

(a)   during the standard trading period or at such other times as may be authorised by an extended trading authorisation,

(b)   …  

(c)   at any time on any day (including a restricted trading day) to a resident of the licensed premises or to a guest of such a resident while the guest is in the resident’s company.

“Resident of licensed premises” is defined in s 4(1) to mean a person (other than the licensee) who resides, or is staying overnight in, a part of the premises that has been set aside for the purposes of accommodation.

30. Section 15 contains general provisions relating to hotel licences as follows:

(1)   The following provisions apply in relation to a hotel licence (the hotel primary purpose test):

(a) except as provided by section 15A, the primary purpose of the business carried out on the licensed premises must at all times be the sale of liquor by retail,

(b)   the keeping or operation of gaming machines (as authorised under the Gaming Machines Act 2001) on the licensed premises must not detract unduly from the character of the hotel or from the enjoyment of persons using the hotel otherwise than for the purposes of gambling.

(2)   The authorisation conferred by a hotel licence does not apply unless the hotel primary purpose test is complied with in relation to the licensed premises.

(3)   Any premises (other than the actual hotel) that are authorised by the Authority for the sale of liquor under a hotel licence are, for the purposes of this Act, taken to be part of the licensed premises to which the licence relates. (Emphasis added.)

31. Section 15A specifies the circumstances in which a hotelier may cease to sell or supply liquor on the licensed premises. Section 15A includes the following provisions:

(2)   Authority may approve of cessation of liquor sales during standard trading period

A hotelier may, at any time during the standard trading period:

(a)   cease to sell or supply liquor on the licensed premises, and

(b)   continue to provide, or make available, other services and facilities on the licensed premises (such as food and non-alcoholic beverages, entertainment and the use of the premises for conferences or meetings and for gambling activities that are otherwise permitted on the premises),

but only with the approval of the Authority.

…

(4)   The Authority may give its approval only if it is satisfied that:

(a)   the operation of gaming machines on the licensed premises during the period to which the approval relates will not detract unduly from the character of the hotel, and

(b)   … (Emphasis added.)

32. Section 16 deals with a general bar licence as follows:

(1)   The Authority may, in granting a hotel licence, designate the licence as a general bar licence and specify in the licence that it is a general bar licence.

(2)   The designation of a hotel licence as a general bar licence cannot be changed.

…

(4) Despite section 14, a general bar licence does not authorise the sale or supply of liquor for consumption away from the licensed premises at any time.

33. Section 17 contains “miscellaneous conditions” applicable to hotel licences including the following:

(2)   Hotels must be open to general public

The business carried out under a hotel licence must not be, or include, a business that is limited to the sale or supply of liquor only:

(a)   to persons who have been invited to use or attend the hotel, or

(b)   to a particular class, or particular classes, of persons using or attending the hotel.

…

(4)   Food must be made available

Liquor may only be sold or supplied in a hotel if food of a nature consistent with the responsible sale, supply and service of alcohol is made available whenever liquor is sold or supplied on the premises for consumption on the premises. If any requirements are prescribed by the regulations in relation to the nature of any such food, those requirements must be complied with.

Packaged liquor licences

34. The following provisions govern packaged liquor licences:

29   Authorisation conferred by packaged liquor licence

(1)   Retail sales

A packaged liquor licence authorises the licensee to sell liquor by retail in sealed containers on the licensed premises, for consumption away from the licensed premises only:

(a)   during the standard trading period or such other period as may be authorised by an extended trading authorisation, or

…  

(3)   Selling liquor by wholesale or to employees

A packaged liquor licence also authorises the licensee:

(a)   to sell liquor by wholesale, at any time on the licensed premises, to persons authorised to sell liquor (whether by wholesale or by retail), and

…

(4)   Tastings

A packaged liquor licence also authorises the licensee to sell or supply liquor, on the licensed premises and during the trading hours permitted by subsection (1), otherwise than in sealed containers to customers and intending customers for consumption while on the licensed premises, but only for the purposes of tasting.

30   Liquor sales area required if bottle shop is part of another business activity

(1)   If the primary purpose of the business carried out on the premises to which a packaged liquor licence relates is not the sale of liquor for consumption away from the licensed premises, liquor may only be sold under the licence in an area of the licensed premises (the liquor sales area) that is adequately separated from those parts of the premises in which other activities are carried out.

(2)   The principal activity carried out in any such liquor sales area must be the sale or supply of liquor for consumption away from the licensed premises.

31      Restrictions on granting packaged liquor licences

(1)   A packaged liquor licence must not be granted for premises that comprise a general store unless the Authority is satisfied that:

(a)   in the neighbourhood of the premises concerned, no other take-away liquor service is reasonably available to the public, and

(b)   the grant of the licence would not encourage drink-driving or other liquor-related harm.

…

(3)     In this section:

general store means a convenience store, mixed business shop, corner shop or milk bar that has a retail floor area of not more than 240 square metres and that is used primarily for the retail sale of groceries or associated small items.

Licensing procedures

35. Part 4 (ss 40-72) of the Liquor Act deals with licensing procedures. Section 45 provides as follows:

(1)   The Authority may, after considering an application for a licence and any submissions received by the Authority in relation to the application, grant the licence or refuse to grant the licence…

…

(3)   The Authority must not grant a licence unless the Authority is satisfied that:

(a)   the applicant is a fit and proper person to carry on the business or activity to which the proposed licence relates, and

(b)   practices will be in place at the licensed premises as soon as the licence is granted that ensure, as far as reasonably practicable, that liquor is sold, supplied or served responsibly on the premises and that all reasonable steps are taken to prevent intoxication on the premises, and that those practices will remain in place, and

(c)   if development consent is required under the Environmental Planning and Assessment Act … to use the premises for the purposes of the business or activity to which the proposed licence relates—that development consent or approval is in force...

36. Section 48 is intended to facilitate the consideration by the Authority of the impact that the granting of certain licences or approvals will have on the local community (s 48(1)). An application for a hotel licence or for removal of a hotel licence (among others) must be accompanied by a community impact statement (s 48(2)(a), (b), (3)).

37. Section 48(5) provides as follows:

The Authority must not grant a licence, authorisation or approval to which a relevant application relates unless the Authority is satisfied, after having regard to:

(a)   the community impact statement provided with the application, and

(b)   any other matter the Authority is made aware of during the application process (such as by way of reports or submissions),

that the overall social impact of the licence, authorisation or approval being granted will not be detrimental to the well-being of the local or broader community.

38. Section 53, which must be read with s 11(1)(a), provides that without limiting any other provision of the Liquor Act, the Authority may at any time on its own initiative impose conditions on a licence. [6] The conditions may include but are not limited to conditions restricting the trading hours of or public access to the licensed premises. [7]

    6. Liquor Act, s 53(1)(b).

    7. Liquor Act, s 53(1A)(b).

39. Division 3 of Part 4 deals with licence removals and transfers. Section 59, which was the focus of the parties’ submissions, provides as follows:

59   Removal of licence to other premises

(1)   A licensee may apply to the Authority for approval to remove the licence to premises other than those specified in the licence.

(2)   An application for approval to remove a licence to other premises must:

(a)  be in the form and manner approved by the Authority,

…

(3)   An application for approval to remove a licence to other premises is to be dealt with and determined by the Authority as if it were an application for the granting of a licence in respect of those other premises. Accordingly, the provisions of Division 1, in particular, extend to an application for the removal of a licence to other premises as if it were an application for a licence.

…

(7)   The approval to remove a licence to other premises takes effect:

(a)   …

(b)   when the Authority endorses the licence to the effect that those other premises are the premises to which the licence relates.

Boundaries

40. Section 94 addresses the boundaries of licensed premises as follows:

(1)   The boundaries of licensed premises are to be specified by the Authority when the licence is granted.

…

(5)   The Authority must not specify or change the boundaries of any licensed premises unless the Authority is of the opinion that any primary purpose requirement under this Act in relation to the licensed premises is or will be complied with.

The Licence

41. A hotel licence was first granted in respect of the Mill Tavern in 1956. In October 2015, Gemstone Hotel Pty Ltd, of which Mr Auld is a director, purchased the premises from which the Mill Tavern was trading. [8] In the same month, Mr Auld became the licensee of the Mill Tavern.

    8. Tribunal Decision at [11].

42. The Mill Tavern ceased to trade in late 2015 and remained closed at the time of the removal application and hearings before the Tribunal. The closure seems to have been due in part to its operations causing “various adverse impacts”. [9] As the Tribunal remarked, thereafter the Licence was held by Mr Auld in a “dormant capacity”. [10]

    9.    Language used in the Community Impact Statement prepared in respect of Mr Auld’s application for removal of the licence.

    10. Tribunal Decision at [11].

43. The Licence held by Mr Auld was expressed to be a hotel licence in respect of premises located at Boorowa Street, Young. The Licence did not define the boundaries of the licensed premises. The Tribunal Decision recorded that rights attaching to the Licence included: [11]

“(a)   sale of alcohol on the premises (which cover an area of about 840m2);

(b)   sale of packaged liquor for off premises consumption;

(c)   permission to trade for 132 hours each week with extended trading until 1:00 am on Thursday nights, 3:00 am on Friday nights and 2:00 am on Saturdays nights; and

(d)   live entertainment.”

The Mill Tavern also had a gaming room with poker machines. [12]

11. Tribunal Decision at [12].

12. Tribunal Decision at [13].

The Removal Application

44. In 2012 ALDI applied for a packaged liquor licence in respect of the Supermarket. A packaged liquor licence authorises the licensee to sell liquor by retail in sealed containers, but only for consumption away from the licensed premises. [13] The Authority rejected ALDI’s application on the ground that ALDI could not satisfy the social impact test set out in s 48(5) of the Liquor Act. [14]

    13. Liquor Act, s 29(1).

    14. Section 48(5) of the Liquor Act is reproduced at [37] above. The 2012 application was not in evidence but it was common ground that it had been made and rejected.

45. Mr Auld lodged the application for removal of the Licence with the Authority on 16 June 2016 (Removal Application). It was common ground that at the time there was nothing to prevent ALDI from applying for a packaged liquor licence in respect of the Supermarket. Such an application, however, would have left the dormant Licence in place for the Mill Tavern, and therefore potentially available to be removed to other premises. ALDI thought that it would have better prospects of establishing that a licence to sell liquor within the Supermarket would not have a detrimental social impact on the local community if the Licence did not remain attached to the Mill Tavern. That consideration explained ALDI’s decision to seek removal of the Licence rather than to apply for a new packaged liquor licence in its own right.

46. The Removal Application was made on the prescribed form and sought approval for the removal of the Licence to premises said to be located at 11 Zouch Street, Young. The printed form pointed out that under the Liquor Act an application for approval to remove a licence to other premises was to be treated as an application for the grant of a licence for the new premises. [15] The form also noted that the applicant was required to complete a community impact statement. [16]

    15. Liquor Act, s 59(3).

    16. Liquor Act, s 48(2)(a), (3).

47. In answer to a question on the form asking about the proposed patron capacity of the licensed area, Mr Auld stated as follows:

“Not applicable. Note: The liquor sales area will be very small and only accommodate a small number of customers at any one time.”

48. The completed form incorporated further information as follows:

“The owner of the Hotel Licence and the premises to which the licence applies, has entered into an agreement with ALDI for the sale of the Hotel Licence for removal to the ALDI Supermarket at 11 Zouch Street Young where it will operate as the liquor department for the Supermarket. The sale is conditional upon the grant of the removal application. Should the removal application be successful (or prior to the grant of the application) the licence will be transferred to ALDI Foods Pty Limited.”

49. The Removal Application was accompanied by a Community Impact Statement (Impact Statement), which included a map depicting a rectangular space within the Supermarket as the area from which ALDI would sell liquor by retail. The Impact Statement was also accompanied by a detailed submission prepared by solicitors in support of the Removal Application.

50. The Removal Application recorded that the hotel licence had been granted in respect of the Mill Tavern 60 years previously, and that the Tavern had operated as a substantial hotel facility occupying an area in excess of 840 m2. The Removal Application continued as follows:

“3.1   It is now proposed to remove the hotel licence less than 400 metres to the ALDI Supermarket situated at 11 Zouch Street Young, where it will operate only as a small packaged liquor facility selling packaged liquor for consumption away from the Supermarket.

3.2   Set out below is various information in respect of the proposed licensed premises and the manner of operation of the proposed licensed premises. The removal of the licence will result in a dramatic reduction in how the Hotel licence can operate, compared to that which is presently the case and was previously the case.”

51. The benefits of the proposed removal of the Licence were said to include significant reductions in the size of the licensed area and in the approved licensed hours. In particular:

“upon removal the licensed area will be significantly reduced to only a fraction of the current approved licensed area being only 33sqm.” (Emphasis in original.)

52. The Removal Application addressed the question of conditions as follows:

“Licence only to be exercised as a Packaged Liquor Licence

3.8   The applicant consents to conditions being imposed upon the removal which prevents the licence being removed to other premises or reactivated as a Hotel, only permits packaged liquor sales to be made pursuant to the licence, and which prevents any consumption of liquor on the licensed premises. This will ensure that the licence can no longer be exercised in the manner which was previously the case and which resulted in various adverse impacts and liquor-related assaults over the years.”

53. The proposed conditions included the following:

“(v)   The licensee will ensure the liquor sales area is adequately defined from the rest of the supermarket by means of a fixed, solid and permanent barrier.

…

(vii)   The licensee will not sell refrigerated liquor products from the licensed premises.

(viii)   The licence is not to be removed to other premises nor is the consumption of liquor permitted on the licensed premises.

(ix)   Entertainment is not to be provided on the licensed premises.”

Authority’s Decision

54. The Authority refused the Removal Application on 14 December 2016 and published its Statement of Reasons on 23 December 2016. In its Statement of Reasons the Authority recorded that s 59(3) of the Liquor Act required an application for removal of a licence to be dealt with as if it were an application for the granting of a licence in respect of the premises to which the licence is to be removed. Thus the Authority had the same powers in relation to the Removal Application as it had in relation to an application for a licence. [17]

    17. Statement of Reasons at [19].

54. The Authority identified the two issues presented by the Removal Application:

• whether the applicant could comply with s 45(3)(c) of the Liquor Act, which required an applicant for a licence to satisfy the Authority that development consent was in place to use the relevant premises “for the purposes of the business or activity to which the proposed licence relates”; [18] and

• whether the Authority could be satisfied, as required by s 48(5) of the Liquor Act, that “the overall impact of the licence … or approval being granted [would] not be detrimental to the well-being of the local or broader community”. [19]

  18. Statement of Reasons at [22].

  19. Statement of Reasons at [13].

56. The Authority accepted that: [20]

“it would be within the scope of authorisation provided by a hotel licence to utilise that licence only to sell packaged liquor – provided that all other requirements of the Act are satisfied”.

The Authority expressed the view that the applicant’s evidence was not sufficient to enable it to find that s 45(3)(c) of the Liquor Act was satisfied. [21] But it rejected the Removal Application specifically on the ground that it could not be satisfied for the purposes of s 48(5) of the Liquor Act that:

“the overall social impact of granting this licence would not be detrimental to the well-being of the local community of Young.” [22]

Proceedings in the Tribunal

20. Statement of Reasons at [45].

21.    Statement of Reasons at [24], [45].

22. Statement of Reasons at [73].

Tribunal Decision

57. On 20 January 2017, Mr Auld sought administrative review of the Authority’s decision pursuant to s 13A of the Gaming and Liquor Administration Act 2007 (NSW) (Liquor Administration Act). Section 13A(1) of the Liquor Administration Act states that a person aggrieved by a decision of the Authority made under a prescribed provision may apply for administrative review of the decision under the Administrative Decisions Review Act 1997 (NSW). [23] In determining an application for administrative review of an “administratively reviewable decision” (including a decision by the Authority), the Tribunal is to decide which is the correct and preferable decision having regard to the material then before it. [24] For this purpose the Tribunal may exercise all the functions conferred or imposed by legislation on the initial decision-maker. [25]

    23. The Appeal Decision recorded that cl 5B(a) of the Gaming and Liquor Administration Regulation 2008 (NSW) (2008 Regulation) prescribed an application for removal of a hotel licence under the Liquor Act for the purposes of s 13A(1) of the Liquor Administration Act: Appeal Decision at [13]. However the 2008 Regulation was repealed with effect from 1 September 2016. The relevant regulation prescribing an application for removal of a hotel licence for the purposes of s 13A(1) of the Liquor Administration Act as at January 2017 was cl 7(1) of the Gaming and Liquor Administration Regulation 2016 (NSW).

    24. Administrative Decisions Review Act 1997 (NSW), ss 7, 8, 63(1),

    25. Administrative Decisions Review Act 1997 (NSW), s 63(2).

58. The Senior Member who heard Mr Auld’s application for administrative review was satisfied that the overall social impact of the Licence would not be detrimental to the well-being of the local or broader community. [26] For that reason, in a decision given on 30 January 2018 the Tribunal set aside the Authority’s decision and approved the removal of the Licence to the Supermarket. The Tribunal ordered that the conditions attached to the removed Licence should be: [27]

“those agreed between the parties which permit the licenced [sic] premises to operate as a packaged liquor outlet only”.

26. Tribunal Decision at [112].

27. Tribunal Decision at [112].

Appeal Decision

59. The Authority appealed as of right to the Appeal Panel on questions of law, relying in substance on four grounds of appeal: [28]

Ground 1: The Tribunal erred in holding that s 59 of the Liquor Act conferred power on the Authority to approve an application for the removal of a licence that “in substance converted a hotel licence into a packaged liquor licence”.

Ground 2: The Tribunal erred in construing s 14(1) of the Liquor Act to empower the Authority to impose licence conditions “which undermined the authorisation conferred by the hotel licence”.

Ground 3: The Tribunal misconstrued s 45(3)(c) of the Liquor Act which required the Authority to ensure that a development consent was in place to use the premises “for the purposes of the business or activity to which the proposed licence relates”. [29]

Ground 4: The Tribunal failed to apply correctly the “hotel primary purpose test” to the Licence as required by s 15 of the Liquor Act.

28. The Tribunal’s decision was an “internally appealable decision” for the purposes of the NCAT Act: s 32(1), (4). A party to the proceedings in the Tribunal may appeal from such a decision to an Appeal Panel as of right on a question of law: s 80(1), (2)(b).

29. Section 45(3)(c) of the Liquor Act applied to the application for removal of the Licence: Liquor Act s 59(3).

60. The Appeal Panel held that:

• The Authority should be permitted to raise Grounds 1 and 4 notwithstanding that the Authority did not rely on those grounds before the Tribunal. [30]

  30.    Appeal Decision at [26], Appendix 1.

• The Authority had power under s 59 of the Liquor Act to grant a removal application that in substance converted a hotel licence into a packaged liquor licence. [31]

• The Authority had power under s 53 of the Liquor Act to impose conditions on a hotel licence the subject of a removal application, so that it became in effect a packaged liquor licence in relation to the new premises. [32] Accordingly, the Tribunal had power under s 53 to impose conditions effectively limiting the licensed premises within the Supermarket to operate as a packaged liquor outlet. [33]

• There was no error in the Tribunal’s construction of s 45(3)(c) of the Liquor Act. [34]

• The Authority was not entitled on an appeal or a question of law to challenge the Tribunal’s factual findings. Thus it was not open to the Authority to challenge the finding that the proposed licensed premises would comprise a 33m2 section of the Supermarket designated as the packaged liquor section. [35]

• There was nothing in the Liquor Act that prevented the Authority (and the Tribunal on an appeal) specifying the boundaries of the premises to which the Licence related so that the licensed premises comprised only the 33m2 designated as the packaged liquor section of the Supermarket. [36] Thus the licensed premises to which the Licence was removed comprised the designated packaged liquor section of the Supermarket.

  31. Appeal Decision at [105].

  32. Appeal Decision at [124].

  33. Appeal Decision at [168].

  34. Appeal Decision at [193].

  35. Appeal Decision at [208].

  36. Appeal Decision at [222].

61. The Appeal Panel considered that the categories of licence available under the Liquor Act “are not defined in such a way that they are mutually exclusive”. This conclusion was said to be supported by the fact that for many businesses selling liquor, more than one type of licence might be available. [37] For example, a bar intended to have no more than 60 patrons at a time could lawfully operate under either a hotel licence or a small bar licence. [38] The Appeal Panel accepted that for certain businesses only one type of licence and not others would be appropriate. Nonetheless: [39]

“the Liquor Act does not generally regulate the sale of liquor rigidly on the basis that only one type of licence is or can be appropriate for every particular business or activity related to the sale of liquor.”

37. Appeal Decision at [29].

38. Appeal Decision at [59]. A small bar licence authorises the licensee to sell liquor by retail on the licensed premises for consumption only on the licensed premises: Liquor Act s 20A. However liquor must not be sold or supplied in a small bar if the number of patrons exceeds 60, or such greater number as may be prescribed: Liquor Act s 20C(1).

39. Appeal Decision at [70].

62. The Appeal Panel emphasised that the objects of the Liquor Act state that the regulatory system is to be “flexible and practical … with minimum formality and technicality”. [40] The Appeal Panel also emphasised that on its reading of the Liquor Act, including the definitions, there was nothing to suggest that the word “hotel” was to be construed as confined to a specific type of business or building which in ordinary usage might be described as a “hotel”. [41]

    40. Appeal Decision at [30], citing Liquor Act, s 3(1)(b).

    41.    Appeal Decision at [41], [45]-[48].

63. The Appeal Panel rejected the Authority’s submission that s 59 of the Liquor Act did not confer power on it to grant a removal application that in substance converted a hotel licence into a packaged liquor licence. The Appeal Panel summarised its reasons as follows: [42]

“This [construction] does not follow from the reference to “the licence” in s 59(1) as contended by the Authority. Nor do we agree that by referring to “remov[ing] the licence”, s 59(1) “does not authorise changing the licence or the type of licence. It simply provides for the premises the subject of the licence to change”. In our view, s 59(3) is not merely a mechanical provision supporting s 59(1). Section 59(3) is the operative provision which, when read with s 45, effectively empowers the Authority to grant or refuse a removal application, with or without conditions imposed under s 53.”

42. Appeal Decision at [105].

64. In the Appeal Panel’s view there was nothing in s 59(1) or any other provision in the Liquor Act that purported to limit the “premises” to which a licence could be “removed”: [43]

“Thus, [s 59(1)] does not expressly establish that a hotel licence cannot be removed “to premises that do not meet the description of a hotel”, as the Authority contended; whether “hotel” in that context refers to a “hotel” in common or ordinary usage or to the limited meaning of “hotel” as set out in s 4(1), namely “the premises to which a hotel licence relates”. Any such restriction, if it existed, would have to be found either expressly in, or by implication from, other provisions of the Liquor Act. We have not been taken to any provisions that create such an express or implied restriction and we do not believe there are any that are relevant to the present proceedings.”

43. Appeal Decision at [112].

65. The Appeal Panel acknowledged that it might be thought “natural” to construe the expression “the licence” in s 59(1) as referring only to a licence of the type sought to be removed. However it was equally open, given that the Authority was required to deal with a removal application “as if it were” an application for the granting of a licence in respect of the other premises, to interpret s 59(1) as referring to a licence appropriate for the new premises in the circumstances. [44]

    44. Appeal Decision at [118].

66. The Appeal Panel gave four reasons for preferring the second construction:

• First, it was unlikely that Parliament would require the Authority to deal with a removal as if it were a fresh application for a licence yet only allow the Authority “to grant the type of licence that had been suitable for the old premises”. [45]

• Secondly, taking a narrow view of the type of licence that could be granted on a removal application would not give effect to the objects of the legislation, which included regulating the sale and consumption of alcohol in a way that is consistent with the expectations, needs and aspirations of the community”. [46]

• Thirdly, the second construction was consistent with the structure of the legislation, as it allowed the licence to cover the activities actually carried out on the premises to which the licence was to be removed. [47]

• Fourthly, the alternative construction involved a degree of inflexibility inconsistent with the objects of the legislation. [48]

  45. Appeal Decision at [119].

  46. Appeal Decision at [120].

  47. Appeal Decision at [121].

  48. Appeal Decision at [122].

67. The Appeal Panel rejected the Authority’s argument that what could not be done directly could not be done indirectly by the imposition of conditions. Since the Authority could determine a removal application by granting a different type of licence, there was no obstacle to imposing conditions to the same effect. In any event, even if that conclusion was wrong the Authority still had power to impose conditions on the licence being removed, so as to limit the business or activity that could be carried out under the licence at the new premises. [49]

    49. Appeal Decision at [127].

68. In the Appeal Panel’s view: [50]

“There is nothing … in s 53 [conferring power on the Authority to impose conditions] or in the general subject matter, scope and purpose of the Liquor Act, which requires, or supports, the conclusion that the Authority cannot, when considering an application under s 59, impose conditions on a hotel licence that would prevent it being used except to authorise the supply of liquor in packaged form for consumption off the premises. If such a restriction on the Authority’s power to impose conditions were to exist, as the Authority contends, it must be found in the specific provisions of the Liquor Act dealing with hotel licences and packaged liquor licenses.

Contrary to the Authority’s submission, ss 14, 15, 15A and 17 of the Liquor Act do not support the second part of the Authority’s ground 1. There do not appear to us to be any other provisions of the Act that would justify the conclusion for which the Authority contends. …”

50.    Appeal Decision at [133]-[134].

69. The Appeal Panel considered that the use of “or” in s 14(1) of the Liquor Act indicated that the holder of a hotel licence could sell liquor by retail both on and off the premises, only on the premises or only off the premises. [51] As a result a hotelier could choose to use one or other or both authorisations. [52]

    51. Appeal Decision at [136].

    52. Appeal Decision at [137].

70. Furthermore, in the Appeal Panel’s view a retail packaged liquor business could satisfy the hotel primary purpose test in s 15: [53]

“The primary purpose of the business carried out on the premises licensed under a hotel licence can be the sale of liquor by retail, within s 15(1)(a), whether the sale is for consumption on the premises only, for consumption away from the premises only or for consumption both on and away from the premises. In addition, s 15(1)(b) only applies if gaming machines are kept or operated on the licensed premises. Accordingly, even if the only business carried out on premises licensed under a hotel licence is the retail sale of liquor for consumption away from the premises with no gaming machines, the hotel primary purpose test will nonetheless be satisfied.

… Thus, we do not accept that ss 14 and 15 of the Liquor Act should be construed as impliedly preventing the Authority from imposing conditions on a hotel licence so that the premises can only operate as a retail packaged liquor outlet.”

53.    Appeal Decision at [139]-[140].

71. The expression “the actual hotel” in s 15(3) did not indicate that a hotel licence was relevant only to buildings that function as an actual hotel in the ordinary sense of the word. [54] The expression had to be understood simply as the premises specified in accordance with s 94 of the Liquor Act as the licensed premises. [55]

    54. Appeal Decision at [142].

    55. Appeal Decision at [144].

72. The Authority submitted to the Appeal Panel that s 45(3)(c) of the Liquor Act required a development consent to be in place, permitting a hotel to be carried on at 11 Zouch Street, Young. This was said to follow from the words “the purposes of the business or activity to which the licence relates” in s 45(3)(c). Since ALDI had development consent for a packaged liquor business, but not for a hotel, the removal application could not satisfy s 45(3)(c) and therefore could not be approved. [56]

    56. Appeal Decision at [175].

73. The Appeal Panel rejected this argument on the ground that s 45(3)(c) should be construed as referring to the actual business or activity which could be carried out under the authority conferred by the specific licence, including any proposed conditions. [57] Since ALDI had development consent for the business of selling packaged liquor on the designated 33m2 section of the Supermarket, s 45(3)(c) was satisfied. [58]

    57. Appeal Decision at [192].

    58. Appeal Decision at [197].

74. Accordingly, the Appeal Panel dismissed the Authority’s appeal.

Conditions

75. As has been seen, the Tribunal’s orders provided for the parties to agree on conditions that would permit the licensed premises in the Supermarket to operate as a packaged liquor outlet only. However, neither the Appeal Panel’s reasons nor those of the Tribunal record the conditions to be attached to the removed Licence.

76. During the hearing in this Court the parties were asked to clarify the position. Their joint written response stated that after the Appeal Decision Mr Auld tendered a set of suggested conditions to the Authority. The tendered conditions accorded with those proposed in a Board Paper prepared in advance of the Authority’s meeting of 14 December 2016 (at which the Removal Application was rejected) but were modified to comply with the Authority’s updated standard conditions. The parties informed the Court that the Authority had not yet agreed to the conditions.

Grounds of Appeal

77. As has been noted, the Authority requires leave to appeal. The Authority filed a draft notice of appeal containing four grounds that mirrored its arguments before the Appeal Panel:

“1. The Appeal Panel erred in law … in concluding that s. 59 of the Liquor Act 2007 (NSW) (‘the Act’) authorised the Authority to determine an application to remove a hotel licence by granting a packaged liquor licence at new premises, and ought to have held that the Authority had no power under s. 59 or otherwise to change the licence type when approving a removal application.

2. The Appeal Panel erred in law … in concluding that the Act authorised the Authority to impose conditions on the removed licence of the kind contemplated by the Tribunal, and in particular the condition that the sale of liquor at the premises be limited to packaged liquor only.

3. The Appeal Panel erred in law … in concluding that the words ‘the business or activity to which the proposed licence relates’ in s. 45(3)(c) of the Act ‘should be construed as referring to the business or activity which can be carried out, under the authority conferred by the specific licence (including any proposed conditions) applied for, at the premises to which that licence relates’, and instead ought to have found that those words should be understood as meaning ‘the business or activity to which the licence type relates.’

4.   As a result of the error of construction identified in ground 3, the Appeal Panel erred in finding … that it was open to the Tribunal to conclude that a development consent was in force under the Environmental Planning and Assessment Act 1979 (NSW) to use the premises for the purposes of the business or activity to which the proposed licence relates.”

78. Mr Auld filed a draft notice of contention challenging the Appeal Panel’s decision to permit the Authority to rely on Grounds 1 and 2 of the draft notice of appeal, when those contentions were not raised before the Tribunal.

Leave to appeal

79. An “appeal” to this Court from the Appeal Panel’s decision is limited to questions of law. [59] The existence of a question of law is not merely a qualifying condition to ground the appeal but is also the subject matter of the appeal. The jurisdiction conferred on the Court, although described as an appeal, is an exercise of original, not appellate jurisdiction. The jurisdiction is therefore in the nature of judicial review and is not a rehearing of the matters before the Appeal Panel. [60]

    59. NCAT Act, s 83(1).

    60. Wesiak v D&R Constructions (Aust) Pty Ltd [2016] NSWCA 353 at [77]-[80] (McDougall J, Beazley P and Simpson JA agreeing), citing B&L Linings Pty Ltd v Chief Commissioner of State Revenue (2008) 74 NSWLR 481; [2008] NSWCA 187 at [47]-[48] (Allsop P, Giles JA agreeing); Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue of the State of Victoria (2001) 207 CLR 72; [2001] HCA 49 at [15] (Gaudron, Gummow, Hayne and Callinan JJ).

79. The Authority’s draft notice of appeal identifies questions of law that raise issues of principle that are of considerable importance in the administration of the Liquor Act. The argument in this Court demonstrated that the Authority has at least a strongly arguable case. Subject to the issue raised by Mr Auld’s draft notice of contention, the Authority should be granted leave to appeal. [61]

    61. Be Financial Pty Ltd as Trustee for Be Financial Operations Trust v Das [2012] NSWCA 164 at [32]-[36] (Basten JA, Tobias AJA agreeing).

Notice of Contention

81. Mr Howard acknowledged that the Appeal Panel’s decision to permit the Authority to rely on an argument not presented to the Senior Member was a discretionary ruling that would not lightly be disturbed. He also acknowledged that the Appeal Panel had thoroughly articulated its reasons for permitting this course. The reasons included a finding that the Authority did not make a conscious forensic decision not to press an argument that it lacked power to approve the Removal Application. [62] This finding was based on uncontested evidence from the Authority’s solicitor that it was only following publication of the Tribunal Decision that the Authority received legal advice as to its power to approve the Removal Application. [63]

    62. Appeal Decision at [280].

    63. Appeal Decision at [241].

82. Mr Howard pointed out, correctly, that parties are generally bound by their conduct of the proceedings. However this proposition is subject to well-established exceptions. Mr Howard accepted that the Appeal Panel had stated the relevant principles correctly.

83. In substance, Mr Howard’s argument was that the Appeal Panel gave insufficient weight to the prejudice occasioned to Mr Auld by the Authority’s change of position. The prejudice was said to be that Mr Auld (and ALDI) could have amended the Removal Application to seek a packaged liquor licence in respect of the Supermarket premises.

84. The Appeal Panel specifically addressed this argument and gave cogent reasons rejecting it. [64] The Appeal Panel observed that there was nothing to prevent Mr Auld from seeking leave to amend his application even on the appeal. And as was noted in argument in this Court, there is nothing to prevent ALDI lodging a fresh application for a packaged liquor licence in respect of the Supermarket. In doing so, it would have the benefit of the Tribunal’s consideration of the social impact of a licence being granted for the sale of liquor for consumption away from the premises.

    64.    Appeal Decision at [285]-[288].

85. No error has been established in the Appeal Panel’s discretionary decision to allow the question of construction to be raised for the first time on the appeal.

Reasoning

Principles

86. There was no dispute as to the well-established principles governing the construction of the Liquor Act. In Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [65] the plurality observed that: [66]

“This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the text itself. Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The language which has actually been employed in the text of legislation is the surest guide to legislative intention. The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy.” (Citations omitted.)

65. (2009) 239 CLR 27; [2009] HCA 41.

66. Alcan at [47].

87. In Certain Lloyd’s Underwriters v Cross,[67] French CJ and Hayne J added the following: [68]

“The context and purpose of a provision are important to its proper construction because … ‘[t]he primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute’ (emphasis added). That is, statutory construction requires deciding what is the legal meaning of the relevant provision ‘by reference to the language of the instrument viewed as a whole’, and ‘the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed’.

Determination of the purpose of a statute or of particular provisions in a statute may be based upon an express statement of purpose in the statute itself, inference from its text and structure and, where appropriate, reference to extrinsic materials. The purpose of a statute resides in its text and structure. Determination of a statutory purpose neither permits nor requires some search for what those who promoted or passed the legislation may have had in mind when it was enacted.” (Citations omitted.)

67. (2012) 248 CLR 378; [2012] HCA 56.

68.    Certain Lloyd’s Underwriters v Cross at [24]-[25].

Structure of the Liquor Act

88. Although the grounds of appeal focused on ss 45(3)(c) and 59 of the Liquor Act, the text of those provisions must be construed having regard to the statutory context. It is convenient to begin with some observations about the structure of the legislation.

89. Section 10 specifies the seven “types of licences” that may be granted under the Liquor Act. Each licence authorises the licensee to sell or supply liquor in accordance with the Act and conditions of the licence (s 10(2)). A licence is subject to such conditions as may be imposed, or are taken to be imposed, by the Authority and a licensee must comply with the conditions to which the licence is subject (s 11(1), (2)). The conditions to which a licence is subject include requirements or restrictions imposed by the Liquor Act in relation to the licence or the licensed premises (s 11(3)).

90. The Liquor Act addresses in detail the nature of the authority granted by each type of licence and the requirements or restrictions that are imposed on, or in relation to, the licence or the licensed premises. Not only does the Liquor Act deal in a separate Division with each type of licence, but the requirements and restrictions are different for each type of licence.

91. For example, a hotel licence authorises the licensee to sell liquor by retail on the licensed premises “for consumption on or away from the licensed premises” (s 14(1)). The parties were in agreement that this authority entitles the licensee to sell liquor for consumption on the premises, for consumption away from the premises, or both.

92. A packaged liquor licence, by contrast, authorises the licensee to sell liquor in sealed containers on the premises for consumption away from the premises only (s 29(1)). An on-premises licence is different again. It authorises the sale or supply of liquor only if the liquor is sold or supplied for consumption on the licensed premises with or ancillary to another product or service that is sold, supplied or provided to people on the licensed premises (such as accommodation services). [69] A limited licence granted on behalf of “a proprietary association” authorises the licensee to sell or supply liquor only for consumption on the licensed premises, but the sale or supply must be ancillary to a “function”. [70]

    69.    This restriction may be removed by the Authority if an application is made by the holder of the on-premises licence in accordance with the prescribed procedures: 22, 24(3), 51.

    70. Liquor Act s 36(1)(a), (2). “Function” is defined in s 4(1). Different requirements apply to liquor sold at a “trade fair”: s 36(1)(b).

93. Only two licences are subject to a statutory primary purpose test. A hotel licence must satisfy the test set out in s 15(1), which requires the primary purpose of the business carried out on the licensed premises at all times to be the sale of liquor by retail. The only other licence that is subject to a “primary purpose test” is an on-premises licence which can be issued pursuant to Div 4 of Part 3. But that is a quite different test which prevents the Authority granting an on-premises licence “if the primary purpose of the business or activity carried out on the premises is the sale or supply of liquor” (s 22(1)).

94. It may be true as Mr Howard submitted (and the Appeal Panel held) that there might be some overlap between the activities authorised by certain licences provided for in Part 3 of the Liquor Act. Licences granted by the Authority therefore do not necessarily have mutually exclusive areas of operation. But that does not mean that the legislation permits licences to be freely interchangeable, in the sense that one type of licence can be effectively converted into another type by the imposition of a fresh set of conditions. In particular, it does not mean that a removal application under s 59 is intended to be a mechanism by which a hotel licence can effectively be converted into a packaged liquor licence.

95. In the present case, therefore, the only power the Authority had was to approve the removal of the Licence to premises other than the Mill Tavern. Contrary to the Appeal Panel’s view, the Authority, in the exercise of the power conferred by s 59, could not approve the transformation of the hotel licence held by Mr Auld in respect of the Mill Tavern into a packaged liquor licence held by ALDI in respect of the Supermarket. If the Authority purported to do so, it would not be granting approval “to remove the [L]icence” to other premises, but approving the grant of a new type of licence in respect of the new premises. Endorsing the Licence to record that it related to new premises (as contemplated by s 59(7)) could not change the Licence from a hotel licence to a packaged liquor licence.

The questions of construction

96. Mr Auld supported the construction of ss 53 and 59 of the Liquor Act accepted by the Appeal Panel. On that construction, ss 53 and 59 empowered the Authority:

• to determine a removal application for a licence by granting a different type of licence for the new premises;

• in any event, to determine a removal application by imposing conditions on the licence being removed so as to effectively convert it into a different type of licence.

A different kind of licence?

97. In assessing Mr Auld’s argument the starting point is the language of s 59 itself. Section 59(1) states that a licensee may apply to the Authority for approval “to remove the licence to premises other than those specified in the licence”. It is true, as the Appeal Panel held and Mr Howard submitted, that s 59(1) does not of itself confer power on the Authority to approve the removal of the licence to other premises. That power is, however, clearly implied by s 59(3), which specifies how the Authority is to determine the application, and by s 59(7), which provides that the approval to remove a licence takes effect when the Authority endorses the licence.

98. The significance of s 59(1) is that it identifies that which the Authority has power to approve. The only action that the Authority can approve under s 59 is the removal to other premises of the licence held by the licensee. The licence that can be removed to other premises is the very licence held by the licensee, not one of the other six types of licence specified in s 10(1) of the Liquor Act.

99. Section 59 plainly provides for the existing licence held by the licensee to remain in force, even after the Authority approves its removal to other premises. It is implicit in the concept of “removal” of a licence that the licence retains its character as a particular type of licence even after removal to new premises. In any event, so much is made clear by s 59(7). The Authority must endorse the actual licence that is to be removed. The legislation thus contemplates that upon approval of a removal application, the existing licence held by the licensee will remain in force but will be removed to new premises.

100. This means in the present case that the Authority could only approve the removal of the Licence actually held by Mr Auld (that is, the hotel licence in respect of the Mill Tavern). Upon approval of the Removal Application the Licence (that is, the hotel licence) would remain in force but would be removed to the Supermarket and no longer apply to the Mill Tavern. The Authority, in determining the Removal Application, could not purport to grant Mr Auld or ALDI a different type of licence such as a packaged liquor licence in respect of the Supermarket.

101. There is nothing in s 59(3) of the Liquor Act that warrants a different conclusion. It addresses the manner in which the Authority is to assess an application under s 59(1). The application must be dealt with and determined as if it were an application for the granting of a licence in respect of the premises to which the licence is to be removed. Read in context, the direction means that the Authority must deal with the application for removal as if it were an application for the grant of the same type of licence as is the subject of the removal application. In the present case, therefore, the Authority was obliged to deal with and determine the Removal Application as if it were an application to grant a hotel licence in respect of the Supermarket.

102. Accordingly, the Appeal Panel erred in law when it held that the Authority had power to approve the Removal Application by granting a type of licence in respect of the Supermarket other than a hotel licence.

A hotel licence subject to conditions?

103. It follows from what has been said that the Authority had power to approve the Removal Application only if it could have granted a hotel licence in respect of the Supermarket. If an application had been made by ALDI (or Mr Auld) for a hotel licence in respect of the Supermarket, the licence could not have been granted unless the applicant could satisfy the hotel primary purpose test specified in s 15(1) of the Liquor Act. The Authority could hardly grant a hotel licence to an applicant who could not conduct the proposed business on the premises in a manner that satisfies the statutory test.

104. The expression “licensed premises” is defined in s 4(1) of the Liquor Act to mean “the premises to which a licence relates”. Mr Auld and ALDI were alive to the fact that the primary purpose of the business carried out in the Supermarket as a whole was not the sale of liquor by retail. They attempted to overcome the difficulty by seeking approval for the removal of the Licence to a discrete 33m2 section of the Supermarket. They described the purpose of the business carried on within that section of the Supermarket as the sale of liquor by retail. According to Mr Howard, this was enough to satisfy the hotel primary purpose test in s 15(1) of the Liquor Act.

105. It is perhaps doubtful whether framing the Removal Application in this way overcomes the difficulty that the Supermarket as a whole cannot satisfy the hotel primary purpose test. However this issue was not addressed in detail in the parties’ submissions and it need not be resolved.

106. Mr Howard supported the Appeal Panel’s holding that the hotel primary purpose test can be satisfied by a retail packaged liquor business. His contention rested on the proposition that a business that sells only packaged liquor for consumption away from the licensed premises has as its primary purpose at all times the sale of liquor by retail within the meaning of s 15(1) of the Liquor Act. Mr Howard adopted the Appeal Panel’s analysis insofar as it held that a hotel licence can be removed to premises that cannot be described as a “hotel” as that term is ordinarily used.

107. I accept that the definitions in the Liquor Act are not helpful in determining the character of a “hotel” that can be the subject of a hotel licence. “Hotel” is defined to mean the “premises to which a hotel licence relates”, while a “hotelier” is defined simply as the “holder of a hotel licence under this Act”. The definition of “licensed premises” does not carry the matter much further because it means “the premises to which a licence relates”. But those rather circular definitions do not mean that a business satisfies the hotel primary purpose test simply because its primary purpose is the sale of liquor by retail. Contrary to Mr Auld’s submissions, it is implicit in Div 2 of Part 3 of the Liquor Act that the business carried out on the licensed premises pursuant to a hotel licence must have certain characteristics.

108. As has been seen, s 14(1) of the Liquor Act authorises the licensee (a “hotelier”) to sell liquor by retail on the licensed premises for consumption on the licensed premises, away from the licensed premises, or both. Section 14 also specifies the times at which liquor may be sold for consumption on the licensed premises (s 14(2)) and for consumption away from the premises (s 14(4)). When read together, these provisions suggest that a hotelier is authorised at all times during permitted trading periods to sell liquor for consumption on or away from the premises.

109. This construction is supported by s 16 which provides that a hotel licence may be designated as a general bar licence. Such a licence, despite s 14, does not authorise the sale or supply of liquor for consumption away from the licensed premises (s 16(4)). The Liquor Act would not need to make provision for designating a hotel licence as a general bar licence if the Authority could simply impose a condition on a hotel licence preventing the sale or supply of liquor for consumption away from the premises.

110. The hotel primary purpose test itself recognises that a business which has the benefit of a hotel licence must have a certain character. Section 15(1)(b) of the Liquor Act provides that in order for the test to be satisfied:

“the keeping or operation of gaming machines … on the licensed premises must not detract unduly from the character of the hotel or from the enjoyment of persons using the hotel…” (Emphasis added.)

111. Section 15A(2) provides that a hotelier may cease to sell or supply liquor on the licensed premises and continue to make other services and facilities available on the licensed premises such as food and gambling activities, but only with the approval of the Authority. The Authority can only give approval, relevantly, if satisfied that the operation of gaming machines on the licensed premises “will not unduly detract from the character of the hotel” (s 15A(4)).

112. These provisions imply that:

• Part 3 of the Liquor Act proceeds on the basis that a “hotel” must have a particular “character”; and

• a hotel will not have the requisite character unless it is conducted on a licensed premises that has a hotel licence permitting the sale or supply of liquor both for the purpose of consumption on the licensed premises and away from the licensed premises.

113. Section 17 supports this construction of Div 2 of Part 3. Section 17(2) effectively requires the business carried on under a hotel licence to involve the sale or supply of liquor to members of the general public. Since s 14(1) authorises the licensee to sell or supply liquor for the purposes of consumption on or away from the premises, the business must incorporate at least the entitlement to sell or supply liquor for these purposes.

114. Section 17(4) provides that liquor may only be sold or supplied if food of the requisite quality is made available “whenever liquor is sold or supplied on the premises for consumption on the premises”. The word “whenever” in the context means “at whatever time” or “no matter when”. [71] Section 17(4) therefore contemplates that liquor will be sold or supplied for consumption on premises subject to a hotel licence and imposes a condition that the hotelier must adhere to when selling or supplying liquor for that purpose.

     71.    Shorter Oxford English Dictionary (Oxford University Press, 6th ed, 2007).

115. It is arguable that the hotel primary purpose test can be satisfied only if the business carried out on the licensed premises has the primary purpose of selling liquor by retail and the business is entitled to sell liquor for consumption both on the premises and away from the premises. It is, however, not necessary to resolve that question. It is enough to conclude that the test can be satisfied only if the business carried out on the licensed premises has the primary purpose of selling liquor by retail and the business is entitled to sell liquor for consumption on the premises. If the business proposed to be carried out on the premises is neither intended to sell nor is to be entitled to sell liquor for consumption on the premises, a hotel licence cannot be granted in respect of those premises.

113. The Removal Application lodged with the Authority sought approval to remove the Licence (a hotel licence) from the Mill Tavern to premises comprising a discrete area of 33m2 within ALDI’s Supermarket. The business proposed to be conducted on the new premises could not satisfy the hotel primary purpose test. Although the primary purpose of the proposed business was the sale of liquor by retail, the business was neither intended to sell nor to be entitled to sell liquor for consumption on the premises.

114. Section 59(3) of the Liquor Act required the Authority to deal with and determine the Removal Application as if it were an application for the grant of a hotel licence in respect of the new premises. Such a licence could not have been granted because the proposed business could not satisfy the hotel primary purpose test. Accordingly, the Authority lacked power to approve the Removal Application.

115. This conclusion is consistent with the reasoning of the Supreme Court of South Australia (In Banco) in Pierce v Liquor Licensing Commission, [72] to which the parties referred in argument. The Appeal Panel distinguished this decision on the ground that the legislation was different. [73] The decision is not directly in point. Nonetheless, Jacobs J’s observation that the statutory characteristics of a hotel distinguished it from other licensed premises under the South Australian legislation is apposite to the present case. [74]

     72. (1987) 47 SASR 22.

     73.    Appeal Decision at [159]-[163].

     74.    Pierce v Liquor Licensing Commission at 23 (Jacobs J).

116. The objects stated in s 3(1) of the Liquor Act do not support a different construction of the legislation. As is often the case, the objects are expressed at a high level of generality and cannot be employed to counteract the construction to be derived from the text and structure of Part 3 of the Liquor Act. Moreover, Mr Auld’s reliance on the reference in s 3(1)(b) to a “flexible and practical regulatory system” was misplaced. As the Authority pointed out, the extrinsic materials indicate that the statutory object of “flexibility” was to be achieved by:

“tak[ing] the liquor licensing out of the courts and introduc[ing] an administrative-based system to reduce complexity and cost for industry, the community and Government.” [75]

75.    New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 28 November 2007 at 4632.

Development consent

120. In view of the conclusion I have reached, there is no need to consider the Authority’s argument based on s 45(3)(c) of the Liquor Act.

Estoppel

121. As a result of an exchange during argument in this Court, leave was granted for the parties to file further written submissions on the question of whether the Authority’s conduct estopped or otherwise precluded it from contending that the Tribunal’s orders were not authorised by the Liquor Act. Written submissions were duly filed but Mr Howard declined to put Mr Auld’s case on the basis of estoppel. There is therefore no occasion to consider that issue further.

122. In the supplementary written submissions Mr Howard argued that whether or not the Appeal Panel had erred in law in permitting fresh arguments to be advanced, the Authority’s conduct of the proceedings in the Tribunal should weigh against the grant of leave to appeal. In my view, once it is accepted that the Appeal Panel did not err in permitting the Authority to advance the fresh arguments, the failure of the Authority to put those arguments to the Senior Member cannot justify refusing leave to appeal from the Appeal Panel’s decision.

Orders

123. The following orders should be made:

1.   Grant the Authority leave to appeal from the decision of the Appeal Panel.

2.   Direct the Authority to file a notice of appeal in the form of the draft notice of appeal within seven days.

3.   Allow the appeal.

4.   Set aside Order 1 made by the Appeal Panel on 27 July 2018 and the Orders made by the Tribunal on 30 January 2018.

5.   In lieu thereof order that the decision of the Authority to refuse Application number 1-4557301491 for the removal of the Licence from the Mill Tavern to premises within the ALDI Supermarket be affirmed.

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Endnotes

Decision last updated: 01 May 2019