Ryan v Commissioner of Police

[2006] NSWSC 1124

CITATION:	RYAN V. COMMISSIONER OF POLICE & ANOR [2006] NSWSC 1124 This decision has been amended. Please see the end of the judgment for a list of the amendments.
HEARING DATE(S):	28 November 2005/29 November 2005/13 December 2005
JUDGMENT DATE :	27 October 2006
JURISDICTION:	CommonLaw
JUDGMENT OF:	Hall J at 1
DECISION:	A declaration that the order purportedly made pursuant to s.104A of the Liquor Act 1982 (NSW) addressed to the plaintiff, Benjamin Michael Ryan, in respect of premises known as Royal Hotel, Heber Street, Moree, dated 4 November 2005 is void and of no effect. I reserve the question of costs in order to allow the parties to make any written submissions within 21 days of the date of this judgment.
CATCHWORDS:	Administrative Law - Liquor Law – penal and quasi-penal provisions – harm minimisation provisions of the Liquor Act 1982 (NSW) – short-term closure order regime s.104A order for closure of hotel premises void for jurisdictional error - procedural fairness in enforcing an order – whether the material the basis of a short-term closure order made ex parte under s.104A Liquor Act 1982 (NSW) should be served on the hotelier licensee with the closure order – whether the duty to act fairly extends to the making available to the hotelier licensee the material the basis of an ex parte order. - Jurisdiction, practice and procedure – warrants and other similar incidental powers – jurisdictional error – independent scrutiny limited to the question of the question as to whether the material in the application capable of satisfying authorised justice of statutory preconditions - judicial review of the making of a short-term closure order under s.104A Liquor Act 1982 (NSW) is restricted to the question whether the order is regularly made, as in the case of the review of warrants, where the relevant question is whether the warrant was regularly issued - duty to act fairly in enforcing order for closure of hotel premises made on ex parte application - refusal to provide material on or after service of order, used in support of application for s.104A order a breach of the duty to act fairly - declaration made that s.104A order void and of no effect.
LEGISLATION CITED:	Liquor Act 1982 (NSW) Law Enforcement (Powers and Responsibilities) Act 2002 (NSW) Search Warrants Act 1985 (NSW) Gaming and Betting Act 1912 (NSW) Listening Devices Act 1984 (NSW) Supreme Court Act 1935 (WA)
CASES CITED:	George v. Rockett (1990) 179 CLR104 Hussien v. Chong Fook Kam [1970] AC 942 Ruddock v. Taylor (2005) ALJR 1534 Elcham v. Commissioner of Police (2001) 53 NSWLR 7 Commissioner of Police v. Atkinson (1991) 23 NSWLR 495 Ousley v. The Queen (1997) 192 CLR 69 Murphy v. The Queen (1989) 167 CLR 94 Danesi v. Commissioner of Police [2003] NSWSC 868 McArthur v. Williams (1936) 55 CLR 324 Annetts v. McCann (1990) 170 CLR 596 FAI Insurances Limited v. Winneke (1982) 151 CLR 342 Kioa v. West (1985) 159 CLR 550 Ainsworth v. Criminal Justice Commission (1992) 175 CLR 564 Mobil Oil Australia Pty. Limited v. Federal Commissioner of Taxation (1963) 113 CLR 475 Marine Hull and Liability Insurance Company Limited v. Hurford (1985) 10 FCR 234 Durayappah v. Fernando [1967] 2 AC 337 Visalli v. Commissioner of Police [2001] NSWSC 360 Bennett & Co. v. Director of Public Prosecutions for Western Australia [2005] WASCA 141 Pamplin v. Express Newspapers Limited (1985) 1 WLR 689 Commonwealth of Australia v. Sterling Nicholas Duty Free Pty. Limited (1972) 126 CLR 297 Telstra Corporation Limited v. Australian Telecommunications Authority (1995) 133 ALR 417 Aussie Airlines Pty. Limited v. Australian Airlines Limited (1996) 139 ALR 663 J.N. Taylor Holdings (in liq.) v. Bond (1993) 59 SASR 432 Chief Constable of North Wales Police v. Adams (1982) 1 WLR 1155
PARTIES:	BENJAMIN MICHAEL RYAN v. COMMISSIONER OF POLICE & ANOR
FILE NUMBER(S):	SC No. 5737 of 2005
COUNSEL:	Plaintiff: M.J. Heath 1st Defendant: M.S. Spartalis 2nd Defendant: G. Mahony (submitting appearance)
SOLICITORS:	Plaintiff: Curtis Delaney Gray 1st Defendant: NSW Police 2nd Defendant: I.V. Knight

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

HALL, J.

FRIDAY 27 OCTOBER 2006

No. 5737 of 2005

BENJAMIN MICHAEL RYAN v. COMMISSIONER OF POLICE & ANOR

JUDGMENT

1 By summons filed in Court on 5 November 2005, the plaintiff sought a declaration that an order made on 4 November 2005 by the Registrar of Moree Local Court pursuant to s.104A of the Liquor Act 1982 (NSW) is void and of no effect. Section 104A permits an “authorised justice” to make an order for the closure of licensed premises for a period no longer than 72 hours.

2 On 4 November 2005, Ms. Narelle Carter, Registrar of Moree Local Court, made an order pursuant to s.104A on application by Inspector Christopher Clarke for the closure of the Royal Hotel at Heber Street, Moree, for a 48 hour period commencing at 5.00 pm on 4 November 2005 and expiring at 5.00 pm on 6 November 2005.

3 At 4.45 pm on 4 November 2005, Inspector Clarke served the order on the plaintiff. A period of only 15 minutes existed from the time the order was served on the plaintiff until the time the premises were to be closed. The plaintiff closed the hotel in compliance with the order.

4 The plaintiff made two separate requests of officers at Moree Police Station to obtain the information that was the basis for the order.

5 Mr. Timothy Ryan, the director of the company managing the hotel, contacted Inspector Clarke twice via telephone, at approximately 5.00 pm and then again at 7.00 pm on 4 November 2005, and requested a copy of the application for the order and the evidence in support of the application. Mr. Ryan’s request was refused.

6 By letter dated 4 November 2005, Curtis Delaney Gray, solicitors for the plaintiff, requested “the information evidencing the need for closure of the licensed premises”. There was no response to this letter.

7 At approximately 8.00 pm on 4 November 2005, the plaintiff’s solicitors served the defendant with the following material:-

(a) A notice of motion seeking, inter alia, an injunction restraining the “defendants its servants or agents … from acting or enforcing the order of the Licensing Court of New South Wales at Moree signed by Narelle Carter on 4 November 2005” .

(b) A notice to produce seeking “all documents in support of the application made by the Commissioner of Police for the order of the Licensing Court of New South Wales at Moree signed by Narelle Carter on 4 November 2005” .

(c) A summons seeking:-

(i) a declaration that the order made on 4 November 2005 by the Licensing Court of New South Wales at Moree is void and of no effect; and

(ii) costs.

8 On 5 November 2005, the plaintiff made an urgent application to the Duty Judge, Rothman, J. By consent, an order was made, without admission of liability, staying the order made by Ms. Carter pending the hearing of the plaintiff’s application. A further order was made, upon the same basis, that the defendant, his servants and agents until the hearing of the application were not to treat the s.104A order as valid until further order of the Court.

Relevant facts

9 The circumstances of the execution of the order and the inquiries made by the plaintiff or on the plaintiff’s behalf after its execution appear from two affidavits. The first is an affidavit of the plaintiff, Benjamin Michael Ryan, the licensee of the Royal Hotel at Moree, sworn on 5 November 2005. The second is the affidavit of Timothy Matthew Ryan, the director of the company, Radoman Pty. Limited, who manages the Royal Hotel at Moree, sworn on 4 November 2005.

10 There was evidence in these proceedings that the licensee, Mr. Benjamin Ryan, had been aware of certain matters in relation to the hotel that were of concern to police. On 27 October 2005, Mr. Ryan met with Inspector Clarke and Sergeant Troy to discuss these matters. At that meeting, Inspector Clarke informed him of police intelligence concerning, inter alia, drug-use in Moree, alleged anti-social behaviour at the Royal Hotel, the need for security at the hotel, and the importance of the responsible serving of alcohol and of harm minimisation in accordance with the Act. In particular, Inspector Clarke drew to Mr. Benjamin Ryan’s attention the fact that police claimed that a syringe had been found in the gaming room of the Royal Hotel.

11 The evidence in support of the application before Ms. Carter was a summary of events recorded by New South Wales Police in the Police Service COPS database in the period commencing 31 August 2005 and ending 1 November 2005. Included in the summary of events were a number of alleged incidents of personal violence, theft, and drunken and disorderly behaviour either in, or in the vicinity of, the hotel. The documentary materials alleged that on several occasions police had been called to the hotel. It was this information that constituted the basis for the order made by Ms. Carter.

12 The defendant relied upon the following evidence:-

(a) Statement of Inspector Christopher Peter Clarke dated 5 November 2005 (Exhibit A).

(b) Statement of Inspector Clarke dated 25 November 2005 subtitled “s.104A closure – reply to statement of Ryan” (Exhibit B).

(c) Statement of Inspector Clarke dated 25 November 2005 subtitled “s.104A closure of the Royal Hotel, Heber Street, Moree” (Exhibit C).

13 Also in evidence were the following documents:-

(a) Hotelier’s license No. 115989 (Exhibit 1).

(b) Copy of order made pursuant to s.104A on 4 November 2005 (Exhibit 2).

(c) Copy of application for order under s.104A dated 4 November 2005 together with attachments (Exhibit 3).

(d) Documents produced by Moree Local Court pursuant to subpoena (Exhibit 4).

(e) Copy of short minutes of orders made on 5 November 2005 by Rothman, J.

14 The application for the order dated 4 November 2005 referred to above contained a statement by Inspector Clarke (paragraph 3) in relation to the circumstances relied upon in support of the application. Paragraph 3 set forth in summary form a number of alleged incidents as referred to in paragraph [11] above. Mr. M.J. Heath of counsel on behalf of the plaintiff contended that many of the incidents lacked the necessary contemporaneity, and he relied upon the evidence indicating that there had been a meeting between Mr. Benjamin Ryan and Inspector Clarke and another police officer on 29 October 2005, at which no allegation was made as to breaches of the Act.

15 Mr. Heath of counsel made submissions in relation to the data placed before the authorised justice. He made a number of criticisms concerning the information, in particular, that the material did not reflect or indicate the existence of “a significant threat or risk” to the public interest within the meaning of s.104(3) of the Act.

Evidentiary matters

16 In his affidavit sworn 5 November 2005, Mr. Benjamin Ryan stated that at the time of the service of the order, he asked Inspector Clarke why he was shutting the hotel. He stated that Inspector Clarke replied, “because of a succession of recent incidents”. Mr. Ryan then said, “What incidents exactly? We had a meeting last Thursday and everything was okay”. He stated that Inspector Clarke replied, “There were two incidents on Tuesday night. There was the incident of the fight between the two fellows and the syringe being found in the female toilets”.

17 Mr. Timothy Ryan, in his affidavit affirmed on 4 November 2005, stated that he spoke to Inspector Clarke by telephone at approximately 5.05 pm on 4 November 2005. In that conversation he inquired as to the basis for the closure of the hotel and claimed that Inspector Clarke said, “It is largely related to anti-social behaviour. It relates to police officers and staff being assaulted”.

18 In a later telephone conversation, Inspector Clarke referred to some incidents of anti-social behaviour as related to the application for closure and specifically referred, according to Mr. Ryan, to a scuffle that occurred on 1 November 2005 between two males and “also syringes had been found in the hotel gaming room”. Inspector Clarke is stated to have made reference to members of the public as the source of information in the latter respect. Inspector Clarke is also alleged to have said, “there are known drug dealers in the hotel”.

19 Later in the conversation, Inspector Clarke is said to have made reference to inadequate security arrangements for the hotel.

20 In his statement Exhibit B, Inspector Clarke states that he had a conversation on 27 October 2005 with Mr. Benjamin Ryan at the Moree Police Station concerning matters relating to conduct at the hotel. These included incidents relating to brawls and “other violence associated with the hotel”. He stated that this meeting was held to ensure that the hotel acted in a manner supporting harm minimisation and the reduction of violence and anti-social behaviour in and around the premises.

21 In response to paragraph 17 of Mr. Benjamin Ryan’s affidavit concerning the incident of a syringe having been found in the female toilet, Inspector Clarke identified an entry in the New South Wales Police Computerised Operating System (COPS). The entry in relation to the incident records:-

“ 01.11.2005 Information Report … three (independent) community sources provided information to Police indicating the presence of syringes in the female toilets whilst they (the community sources) were in attendance at the hotel on the date of November 1, 2005 (Melbourne Cup Day).
A check of the toilets by a female officer (difference in time not specified) resulted in nil find. Information provided by Security Staff at the Hotel indicated that a syringe had been located one week prior on the floor (not further described).
A check of the records maintained by the NSW Police Force has revealed no report of a syringe being found upon the premises.”

22 In cross-examination, Inspector Clarke stated that he had a conversation with the authorised justice at the time the application for the s.104A order was made. That conversation lasted for 10 to 15 minutes. He agreed in evidence that Mr. Timothy Ryan had requested a copy of the application and supporting documents and that he had indicated that the original application was with the Court. He denied that he said that if he wanted access to the original application Mr. Ryan would have to go to the Court. He denied that Mr. Timothy Ryan said, “can I have a copy of the application and documents used in support to get the order?”. He denied that he stated that he was not going to provide a copy of the documents to Mr. Ryan.

23 When taken to his statement (Exhibit B), he conceded that the document was prepared as a response to the affidavit of Mr. Timothy Ryan. He also conceded that he did not, in paragraph 17 of his statement in response to paragraph 9 of Mr. Ryan’s affidavit, deny what Mr. Ryan had there stated (to the effect that Inspector Clarke stated that he was not going to provide a copy of the application and supporting documents).

24 In relation to the primary factual matters, it is clear, and I make findings accordingly, that:-

(a) The order made under s.104A of the Act was served upon the plaintiff without a copy of the application or supporting documentation.

(b) Mr. Timothy Ryan on 4 November 2005 requested Inspector Clarke to provide a copy of the application and supporting documents but that Inspector Clarke stated that he would not provide a copy of the documents and advised Mr. Ryan to the effect that he could make any request in that respect to the responsible officers at the courthouse.

(c) That a request was made on behalf of the plaintiff by Curtis, Delaney Grey on 4 November 2005 to the Inspector and the Crime Manager, New South Wales Police, Moree Station for a copy of the documents but that no response to such request was made.

Issues in these proceedings

25 The plaintiff initially raised three arguments in support of his application for a declaration as to the validity of the short-term closure order. These arguments may be summarised as follows:-

(a) That the refusal to provide information as to the basis upon which the order was made deprived the plaintiff of an entitlement to apply for urgent prerogative relief. This denial of procedural fairness was said to have made the order void and of no effect.

(b) That material presented to the Registrar of Moree Local Court was inadequate to satisfy the requirements of s.104A of the Act, with the consequence that there was no jurisdiction to make the order.

(c) That the person purporting to issue the order was not an “authorised justice” within the meaning of s.104A of the Act.

26 The argument referred to in (c) was abandoned during the hearing.

27 In his submissions on behalf of the plaintiff, Mr. Heath essentially developed two grounds. The first asserted jurisdictional error in that the material placed before the authorised justice did not establish a “significant threat or risk to the public interest” within the meaning of s.104A(3). The second asserted, that the failure to serve with the order (and a subsequent refusal and/or failure to supply on request) a copy of the material placed before the authorised justice when applying for the order constituted a breach of the rules of procedural fairness. In this latter respect, it was argued that the failure to comply with the rules of procedural fairness operated to negate the appellant’s rights to challenge the service of the order upon him in judicial review proceedings.

28 In relation to the second ground, Mr. Heath made it clear that he did not contend that the requirements of procedural fairness qualified or limited the power to make an order under s.104A. The focus of the argument sought to be made was narrower than that. It was that the claimed breach of procedural fairness rules operated to invalidate the applicant’s right to enforce the order.

29 The plaintiff’s case, as refined in the plaintiff’s additional submission was in the following terms:-

“Procedural Fairness
1. It is submitted that in circumstances where the authority seeking to enforce an order pursuant to s.104A of the Liquor Act … fails or refuses to provide the material used in … support of obtaining the order either at the time of or immediately following service of the order constitutes a procedural unfairness.

(a) entitles the recipient licensee to make an application for a stay (sic) operation of the order and an injunction against any authority seeking to enforce it treating it as valid; and/or
(b) for the purposes (sic) final relief such a procedural unfairness operates so as to mean that service of the order was ineffective to require closure of the premises the subject of the order for the purposes of s.104A(6) of the Act;
(c) in other words, the effect of the procedural fairness is the same as if the order had never been served (a footnote stated: ‘This does not mean that the order itself is rendered invalid, just that it is as if the order had never been served’ ).”

30 In addition to this last-mentioned submission, it was also contended in the “plaintiff’s submission #3”:-

“2. The point at which the procedural fairness obligation arises is not as to the making of the order itself but the manner in which it is carried out, ie., at the time of service.”

31 The issues raised by the summons, accordingly, challenge the jurisdictional basis for the making of the order on the ground that the materials before the authorised justice could not satisfy the preconditions for the making of an order under s.104A. The legality of the enforcement of the order was argued upon the procedural fairness ground earlier outlined. I will accordingly proceed below to consider the bases subjacent to the two-fold challenged made by the plaintiff.

Section 104A of the Liquor Act 1982 (NSW)

32 Section 104A provides as follows:-

“1. An authorised officer may, by notice served on a licensee or a person apparently in charge of licensed premises, order the licensee to close the licensed premises from a time specified in the order until a later specified time.

2. An authorised officer may only make an order under this section:-
(a) on the application of the Director or Commissioner of Police, and
(b) if the authorised officer is satisfied that a serious breach of this Act has occurred, or is likely to occur, on the premises and that the closure of the premises is necessary to prevent or reduce a significant threat or risk to the public interest.


3. Without limiting the generality of subsection (2), circumstances in which there may be a significant threat or risk to the public interest include circumstances in which there is:-

(a) a threat to public health or safety, or

(b) a risk of substantial damage to property, or

(c) a significant threat to the environment, or

(d) a risk of serious offences (having a maximum penalty of not less than two years imprisonment) being committed on the premises.


4. An order must not require the closure of premises for a period longer than 72 hours.

5. An order may require the closure of the premises until specified conditions are met but must not require closure for a period longer than 72 hours.

6. A licensee must not fail to comply with an order made under this section. Maximum penalty: 50 penalty units or imprisonment for months, or both.

7. Two or more orders closing the same premises may not be made under this section in any period of one week.”

33 Section 104A is included in Part 6 of the Act which is entitled “Licensed premises”. Part 6 deals with a number of matters relating to the control of licensed premises and the maintenance of order in and about such premises.

34 An “authorised officer” under the Liquor Act has the same meaning as “authorised officer” under the Law Enforcement (Powers and Responsibilities) Act 2002 (NSW), and includes a Magistrate or Children’s Magistrate, a Clerk of the Local Court, or an employee of the Attorney General’s Department authorised by the Attorney General as an authorised officer for the purposes of this Act, either personally or as the holder of a specified office: s.3 of the Law Enforcement (Powers and Responsibilities) Act 2002.

35 I have referred in paragraph [8] above to the fact that the order for the 48 hour closure on 4 to 6 November 2005 was made the subject of a stay order made on urgent application by Rothman, J. on 5 November 2005. The practical effect, accordingly, of that order was to negate, in terms of its operation, the order made under s.104A. That is a fact that has to be brought to account in determining whether or not there any longer exists a proper basis for the making of a declaratory order, even if the Court were to uphold one or other or both of the arguments relied upon in terms of jurisdictional error or procedural fairness. That is a matter to which I will return later in this judgment.

(1) Jurisdictional error

36 As discussed earlier, the authorised justice had before her information in an application setting out a number of factual matters asserted by Inspector Clarke. The application was verified, being sworn on 4 November 2005. Paragraphs 1 and 2 of the application were in the following terms:-

“1. I have reasonable grounds for believing that there is, or within 72 hours there will be, on or in the premises, a serious breach of the Liquor Act 1982 has occurred, or is likely to occur on the premises and that the closure of the premises is necessary to prevent or reduce a significant threat or risk to the public interest.
2. The reasonable grounds I rely upon are:-
(a) a threat to public safety, or

(c) a risk of serious offences (having a maximum penalty of not less than two years imprisonment) being committed on the premises.”

37 Counsel for the plaintiff submitted that the material placed before the authorised justice was not such as could properly have satisfied her that the requirements of s.104A had been complied with. He argued in this respect that that material did not provide a basis upon which she could have been satisfied that a serious breach of the Act had occurred, or that at the time the application was made, such a breach was likely to occur on the premises. In particular, in addition to the claimed lack of contemporaneity in relation to any conduct or alleged breaches of the Act previously mentioned, he contended that, whether considered individually or together, the facts could not be characterised as constituting circumstances “in which there may be a significant threat or risk to the public interest” in terms of s.104A(3) and, in particular, s.104A(3)(a), (b) and (d) of that section.

(a) The basis of jurisdiction

38 Section 104A requires an authorised justice to be “satisfied” of the preconditions specified in the section. In George v. Rockett (1990) 179 CLR 104, the required state of mind was one of “suspicion and belief”. The High Court observed (at 115, per curiam, quoting Hussien v. Chong Fook Kam [1970] AC 942 at 948), that “Suspicion … in its ordinary meaning is a state of conjecture or surmise where proof is lacking: “I suspect but I cannot prove.’ … [S]ome factual basis for the suspicion must be shown”. By way of comparison (at 116, per curiam), “belief is an inclination of the mind towards assenting to, rather than rejecting, a proposition and the grounds which can reasonably induce that inclination of mind may, depending on the circumstances, leave something to surmise or conjecture”. See also Ruddock v. Taylor (2005) 79 ALJR 1534, 1545-1546 per McHugh, J.

39 O’Keefe, J. in Elcham v. Commissioner of Police (2001) 53 NSWLR 7 at 16 [40] held that the state of mind required by s.104A is one of “satisfaction” – a “higher threshold” than was required under the search warrant legislation in issue in George v. Rockett – and therefore the “facts put before the authorised justice by the applicant must be such as to be capable of satisfying a reasonable person of the matters required by the statute and must in fact so satisfy the authorised justice” (at 16 [40]).

40 The question whether an authorised person is “satisfied” as to the preconditions for the exercise of the discretion to issue a search warrant is a question that goes to the jurisdiction of the authorised person: Commissioner of Police v. Atkinson (1991) 23 NSWLR 495 at 505A, per Gleeson, CJ. (see paragraph [42] below)

(b) The material upon the basis of which jurisdiction is exercised

41 Where the validity of a search warrant is challenged, judicial scrutiny is confined to the question whether there was sufficient material upon which to base an exercise of the relevant discretion, however expressed in the relevant legislation, to issue the warrant: George v. Rockett (1990) 179 CLR 104 at 114-115, per curiam. The authorised justice acting under s.104A must be “satisfied” of three essential conditions, namely that:-

(a) “A serious breach of this Act has occurred” , or “is likely to occur” .

(b) Such breach has or is likely to occur on “the premises” .

(c) Closure of the premises is necessary to prevent or reduce a significant threat or risk to the public interest .

42 Once the authorised person is “satisfied” as to these preconditions for the exercise of jurisdiction ((a), (b) and (c) above), it is that satisfaction, not the facts themselves, that forms the basis for the exercise of the jurisdiction: Commissioner of Police v. Atkinson (1991) 23 NSWLR 495 at 505E, per Gleeson, CJ. That case was concerned with provisions of the Search Warrants Act 1985 (NSW) and the Gaming and Betting Act 1912 (NSW). However, observations there made are instructive as to the approach to be taken in determining questions of validity in the exercise by an authorised justice of the power under s.104A. Gleeson, CJ. observed that considerations of the practical utility of making an order, or the circumstances that warrant the making of an urgent order, are questions that are left to the authorised person: “the legislation commits the decision upon those questions to the justice, and provided it is made according to law, it is binding. It is not for this Court to substitute its own opinions on the issues of fact involved” (at 505F, per Gleeson, CJ).

43 If the material placed before an authorised justice in an application under s.104A for the short term closure of licensed premises does not establish all of the essential elements under s.104A, then the order is not one validly made under the section. Similarly, in the case of the issue of a search warrant where the material the foundation for the exercise of the discretion is insufficient, then the precondition to the exercise of the discretion does not arise and there is no valid exercise of power. The result is that the warrant or order is invalid for want of jurisdiction: George v. Rockett (1990) 170 CLR 104 at 122, per curiam.

44 In George v Rockett, the High Court placed considerable emphasis (at 111, per curiam) on independent scrutiny in the issue of search warrants by reason that:-

“To insist on strict compliance with the statutory conditions governing the issue of search warrants is simply to give effect to the purpose of the legislation.”

45 The issuing of a warrant is characterised as an administrative act and as such is open to collateral review. However, such a review is limited to the question of the validity of the warrant on its face: Ousley v. The Queen (1997) 192 CLR 69 at 85, per Toohey, J., at 87, per Gaudron, J., at 100, 102-104, per McHugh, J.

46 In summary, then, the validity of a search warrant is dependent not on the sufficiency of the material supporting the application, but on the warrant having been regularly issued: Ousley (supra) at 87 per Gaudron, J. quoting the joint judgment of Mason, CJ. and Toohey, J. in Murphy v. The Queen (1989) 167 CLR 94 at 106.

47 Authorities in other areas of the law concerned with the issue of warrants provide some guidance as to the approach to be taken in challenges to their validity. In Murphy v. The Queen (1988-1989) 167 CLR 94, Mason, CJ. at Toohey, J. at [105] stated that in that case a challenge to the validity of a warrant issued under the Listening Devices Act 1984 (NSW) based on collateral attack on the warrant founded on an alleged insufficiency of the materials placed before the Supreme Court by the applicant for the warrant was misconceived. Similarly, in McArthur v. Williams (1936) 55 CLR 324, Dixon, Evatt and McTiernan, JJ. emphasised that the validity of a warrant could not depend upon the nature or sufficiency of the materials upon which a magistrate granted the warrant if there was an information on oath before him which was not a nullity. The Court there emphasised, in general, that the sufficiency or character of materials which are required for the purposes of exercising a discretion is not a matter upon which the validity of the discretionary act is made to depend.

48 The question then is how and on what basis a challenge may be made to a s.104A order made by the authorised justice? An order under that provision may require the closure of licensed premises for up to 72 hours. In this case, the order, as noted earlier, required the closure of the Royal Hotel at Moree for 48 hours. The applications made to this Court in Danesi v. Commissioner of Police [2003] NSWSC 868 and in the present case were both in respect of short-term closure orders for the purpose of obtaining stay orders pending the prosecution of appeals.

49 Whilst an order by the Licensing Court for the closure of premises under s.104C requires admissible evidence, an order sought under s.104A may be obtained without notice on an ex parte basis and on a basis which is less onerous in the evidentiary sense than is required by s.104C.

50 I agree, with respect, with the observation of O’Keefe, J. in Elcham & Anor v. Commissioner of Police & Ors (2001) 53 NSWLR 7 at 15 that, given the serious detrimental effects that may result from an order made under s.104A in respect of a person operating licensed premises (or an owner of premises who is not the operator) it is necessary for an authorising justice to ensure that there is material capable of satisfying each of the jurisdictional preconditions set out in s.104A(2)(b) as discussed and summarised in paragraph [41] of this judgment. Otherwise, as his Honour observed, unless such an approach is in fact adopted, the power provided in s.104A could be used as an “instrument of oppression”: Elcham (supra) at p.15.

51 The primary submission made on behalf of the plaintiff in respect of the order made under s.104A was that the requirements of that section of the Act were not and could not have been met based on the material presented to the authorised justice. Accordingly, so the submission went, the order was made without jurisdiction.

(c) The basis upon which the s.104A order was obtained

52 In written submissions made by Mr. M.S. Spartalis of counsel on behalf of the defendant, the chronology of alleged incidents and breaches are set out. In each case, a provision of the Liquor Act is cited as indicating that the material was capable of substantiating a breach of the Act. Reliance was placed upon incidents or events as recorded in the New South Wales Police Service Cops database for the period 31 August 2005 to 1 November 2005. Reliance was also placed upon the following provisions of the Liquor Act in relation to those incidents or events:-

(a) Section 125(1)(b) of the Act, which provides as follows:-

“A licensee shall not:-
(a) …
(b) permit intoxication, or any indecent, violent or quarrelsome conduct, on his or her licensed premises.”

(b) Section 125E(1)(b) of the Act provides as follows:-

“A licensee shall not permit his or her licensed premises to be used for the sale of:-
(a) …
(b) any substance that the licensee suspects of being a prohibited plant or a prohibited drug within the meaning of the Drug Misuse and Trafficking Act 1985.”

(c) Section 125E(1)(a) of the Act provides as follows:-

“A licensee must not permit the possession or use on the licensed premises of any substance that the licensee suspects of being a prohibited plant or a prohibited drug within the meaning of the Drug Misuse and Trafficking Act 1985.”

(d) Section 125E(2A) (prohibition on the possession or use on licensed premises of any substance that a servant of a licensee or a person suspects of being a prohibited plaint or a prohibited drug).

53 It was contended on behalf of the defendant that the material placed before the authorised justice provided sufficient information to determine that there had been numerous “serious breaches” of the Act or likely “serious breaches” and that there was a continuous pattern of violence, intoxication and drug use at the hotel preceding the closure that posed a significant threat or risk to the public interest such as to require the closure of the premises for 48 hours. Particular reliance was placed upon the six events said to be “significant” as recorded on 1 November 2005.

54 It was contended on behalf of the defendant that violence, intoxication, drug use and drug sales were all a risk to the public interest. It was further claimed that the documents established a pattern of conduct against the public interest and that there was a temporal connection established.

55 In relation to the particular incidents relied upon in the application for the order, the defendant relied upon the provisions of s.104A(3)(a) and (d), namely, a significant threat or risk where there is a threat to public health or safety or a risk of serious offences (having a maximum penalty of not less than two years) being committed on the premises.

56 The defendant also relied upon material allegedly establishing a breach in terms of s.125(1)(b), namely, permitting intoxication on licensed premises and the selling or supply of liquor to any person who, at the time, was in a state of intoxication (s.125(3)).

57 Section 125(4) provides that where a person is intoxicated on licensed premises, the licensee shall be deemed to have permitted intoxication unless he or she proves that the licensee and his or her employees took the steps set out in s.125(4A) or all other reasonable steps to prevent intoxication on the licensed premises.

58 The evidence of Inspector Clarke in cross-examination was that the documents produced to the authorising justice included the four page application dated 4 November 2005 “… with all the relevant COPS documents that were relied upon in the application. They remain with the Court.” (t.39).

(d) The relevant principles in relation to s.104A orders

59 Before determining whether the application enabled the authorising justice on the supporting material to be “satisfied” in terms of s.104A(2)(b), the relevant principles guiding such a determination should be identified. These were discussed by O’Keefe, J. in Elcham (supra) and may be summarised in the following terms:-

(a) There is no express prescription as to the basis for the required satisfaction of an authorised justice in s.104A.

(b) In terms of the three conditions specified in s.104A(2)(b) that are conditions precedent to the exercise of jurisdiction under the section, the section does not require that the subject matter of the satisfaction be formally proved.

(c) What is required in that respect is that there be a rational basis for the material put before the authorised justice on which a reasonable person could be satisfied as to the matters specified in s.104A(2)(b) and on which the authorised justice is in fact satisfied.

(d) It is essential that there be placed before the authorised justice material that is capable of satisfying a reasonable person of the jurisdictional preconditions set out in s.104A(2)(b) and which in fact satisfy the authorised justice of such preconditions.

(e) The degree of satisfaction does not depend upon strict or formal proof of the facts underlying the preconditions.

(f) Nor is it necessary that the material placed before the authorising justice is such as would be admissible in the Licensing Court or in proceedings brought under s.104C of the Act.

(g) What is required by the section is more than suspicion, conjecture, surmise or belief. There must be established in the authorised justice an affirmative state of mind by the material in support of the application.

(h) The onus of producing the relevant state of mind in the authorised justice lies on the applicant for the order.

(i) The standard of proof in this respect is the civil standard.

60 It need only be stated that, in addition to the above matters, regard should be had, as Mr. Spartalis for the defendant emphasised, to the provisions of s.2A of the Act which is concerned with harm minimisation as a primary object of the Act. That provision states, in part:-

“A primary object of this Act is liquor harm minimisation, that is, the minimisation of harm associated with misuse and abuse of liquor (such as harm arising from violence and other anti-social behaviour) …”

61 The other matter to be borne in mind is that, given the objectives and purpose of the Act, an approach which is beneficial rather than restrictive in its construction is appropriate: Elcham (supra) at 15.

(e) Assessment of the material placed before the authorised justice

62 As earlier noted, the authorised justice had before her a verified statement by Inspector Clarke as to “reasonable grounds for believing” there was a prospect of a serious breach of the Liquor Act as well as for a belief that breaches had occurred in the past. The application also asserted that closure of the premises was “necessary” to prevent or reduce a significant threat or risk to the public interest.

63 The principal incidents, referred to in paragraph 3 of the application as supported by the COPS documents, generally fall into three categories. The first relates to the alleged presence and/or sale and distribution of prohibited drugs in the hotel and the alleged presence of persons stated to be known drug users. In that respect, four episodes are referred to in paragraph (3) of the application (26 October 2005, 28 October 2005 and two incidents on 1 November 2005). The second category of incidents pertains to the question of alcohol consumption. The third category relates to anti-social behaviour and events involving violence.

64 The application and supporting material placed before the authorised justice constitutes Exhibit 3 in the present proceedings. Before commenting upon that material, it is necessary to have regard to the exceptional power to effect a short-term closure of premises under s.104A. An order may only be made under the provision if there is material that is capable of satisfying an authorised justice, not merely of a breach, but that “a serious breach” of the Act either has occurred or is likely to occur on the premises. Furthermore, the authorised justice must be satisfied that the significant step of closure of the premises “is necessary” in the sense of being necessary “to prevent or reduce a significant threat or risk to the public interest”. As earlier stated, the nature of the “significant threat or risk” to the public interest is to be determined having regard to the provisions of s.104A(3).

65 I have examined the material in Exhibit 3 in order to determine whether or not it is capable of satisfying the “threshold” to which I have referred in paragraph [39] above, namely, in order to ascertain whether the facts revealed in them were capable of “satisfying a reasonable person of the matters required by the statute” (see paragraph [39] above).

66 Generally speaking, one would expect that more recent incidents or events concerning hotel premises will be of greater significance in determining whether or not the preconditions of s.104A have been satisfied. That is not to say that more distant events are devoid of any significance. However, in order for an authorised justice to be satisfied that it is necessary for premises to be closed to prevent or reduce a significant threat or risk to the public interest, attention will invariably be given to the nature, extent and gravity of information pertaining to the premises at a time that is more proximate to the date upon which the authorised justice is considering the material for the purposes of s.104A.

67 The following general observations are made in relation to the material in Exhibit 3:-

(a) Inspector Clarke verified that he held reasonable grounds for belief of matters concerning the preconditions specified in s.104A. The circumstances relied upon are set out in a two and a half page document containing summary information reports commencing 31 August 2005 to 1 November 2005, 8.45 pm.

(b) The material refers to six alleged events or incidents said to have occurred at various times on 1 November 2005. Some of these refer to suspected illicit drug use on the premises. However, follow up enquiries based on information supplied to police, in several material respects, failed to produce corroboration.

(c) Certain reported incidents of assault are not revealed by the material as disclosing either a continuing or increasing level of violence such as would make necessary the closure of the hotel in order to avert or reduce a significant threat or risk to the public interest.

68 In relation to the question of drug activity, I am of the opinion that the material placed before the authorised justice in relation to the alleged incidents concerning drugs to which I have referred was not such as could satisfy a reasonable person that a breach of s.125E of the Act had occurred on the licensed premises on those dates. Section 125E(2) and s.125E(2A) and s.126(2) of the Act make it an offence for certain categories of persons to permit licensed premises to be used for the sale of prohibited drugs or substances suspected of being prohibited drugs. There is no material which affirmatively established that the licensee permitted any such acts as prescribed by the last mentioned provisions or that a servant of the licensee or other person in charge of the premises permitted the premises to be used for drug activity.

69 The following additional observations should be made in relation to the material concerning suspected drug usage on the premises:-

• The information report summary dated 1 November 2005 referred to information from three community sources that a number of needles were in the female toilets of the hotel. However, inspection a short time later revealed a negative result.

• The same report referred to information that drug suppliers or users had been on the premises without any detail as to identity, occasion or any activity that allegedly took place.

• The information report summary also dated 1 November 2005 referred to the removal of a woman from the hotel who had been known within Moree as having engaged in cannabis supply. No information is recorded as to whether that person was involved in drug activity on the premises.

• A further information report summary dated 1 November 2005 observed a person of interest drinking on the premises who was said to have been involved in drug supply and possession of ecstasy and amphetamine. The report refers to “possibly dealing in the hotel” . There is no information as to whether the person had been so engaged.

• In relation to an information report summary in relation to an incident on 28 October 2005 referred to “possible drug activity” , and refers to a man approached by police at the hotel. He was searched and a small resealable bag was located on him containing two white capsules. Although the report refers to the bag containing the capsules as entered as a drug exhibit, there is no information indicating the nature of the substance within the capsules. There is no information suggesting that the person was carrying on any activity associated with drugs on the hotel premises.

70 In relation to other incidents not associated with possible drug usage, I have carefully examined the information report summaries. They refer to individual incidents including matters such as the outbreak of arguments between patrons on specified occasions, a brawl between two hotel patrons on another and a few incidents involving assault.

71 It would not be unreasonable to conclude that behaviour or incidents of this kind may well be associated with excessive consumption of alcohol. The same applies to incidents involving property damage. However, accepting that the material is capable of giving rise to such a conclusion, it is another matter entirely as to whether it satisfies the preconditions set out in s.104A, in particular, as capable of satisfying an authorised justice that closure of premises is necessary to prevent or reduce a significant threat or risk to the public interest.

72 The information report summaries attached to Inspector Clark’s application included the following:-

• On 1 November 2005, unknown persons smashed the front glass window pane of Freeman’s Jewellers. Thirty or 40 people were standing and loitering near the hotel after closure. There is no other information indicating how or why or by whom the glass window pane came to be smashed.

• An information report summary in relation to an incident on 1 November 2005 related to 15 persons seen outside the hotel. The lengthy report deals with a series of incidents concerning a young woman who was in an emotional and aggressive state yelling at police ultimately leading to her arrest.

• An information report summary relating to an incident on 1 November 2005 concerned an altercation between two males, one of whom was in the presence of his partner. This is said to have led to a fight between them with security personnel at the hotel ejecting one of the persons. A window was smashed as he was being ejected. Police were contacted and the persons was arrested.

• Information report summary relating to an incident on 1 November 2005 relating to a police patrol at about 3.30 pm at the hotel. “Nil offences” were detected. The report refers to discussions between the licensee and police as to security arrangements for forthcoming Melbourne Cup Day celebrations.

• Information report summary relating to an alleged brawl on 30 October 2005 at the hotel. Three males were seen in the carpark of a hotel and one male person urinating in the bushes in the carpark. In the hotel, the manager of the hotel was intervening in a heated argument between a male and a female in the doorway of the front bar. Police sighted persons who were “deemed too intoxicated” including a young female who appeared to be unsteady on her feet. The manager was interviewed by police who stated that the woman had been seated during the afternoon with others purchasing drinks and he had not noticed her level of intoxication. Police raised with the manager that 50 to 60 patrons in the hotel appeared to have levels of intoxication ranging from “moderately to well intoxicated” .

• Information report summary in relation to an incident on 30 October 2005 involving a brawl. The manager of the hotel was standing at the front of the premises between a male and female person who were arguing. Police eventually restored order. The female person was noted as appearing well effected by intoxicating liquor.

• Information report summary of 27 October 2005 refers to two dry vomit patches rendering the female toilet unusable.

• An information report summary concerning an incident on 27 October 2005. A patron accused another of taking his money ($50) placed on the bar. The person making the allegation struck the victim in the face.

• An information report summary concerning an incident on 26 October 2005. One patron tapped another on his shoulder over a personal issue. As a result, one of the two punched the other to the right side of her face. Police witnessed the assault and separated both parties and escorted the accused from the premises.

• An information report summary concerning an incident on 24 October 2005. A woman alleged that her drink had been spiked. She was with her boyfriend and others. She left the hotel and is alleged, a short time later, to have collapsed. An ambulance was called but was cancelled. It was noted that she was affected by alcohol and was later allowed to leave Moree Hospital.

• An information report summary concerning an incident on 22 October 2005. Patrons were leaving the hotel. A crowd of 50 to 60 patrons were loitering on the western side of Balo Street. A majority of the persons are noted as appearing moderately intoxicated. The report notes that “nil persons” were sighted to be smashing beer bottles present the street. Police were unable to ascertain who was consuming alcohol and who had smashed the bottles.

73 In addition to the above, the remaining information report summaries attached to the application for the s.104A order include report summaries concerning incidents on the following dates: 21 August 2005, 10 September 2005, 11 September 2005 (two), 12 September 2005 (two), 24 September 2005, 1 October 2005, 7 October 2005, 8 October 2005 (four),14 October 2005 and 15 October 2005. It is unnecessary to set out the detail concerning these incident sheets. They range from incidents involving arguments between patrons and/or the manager of the hotel, an altercation outside the hotel, a person standing on the roadway and footpath blocking cars and pedestrian traffic, abusive language directed by a male person to police, an allegation by a patron that he had been hit on the left side of the face, reference to a person who had been barred from the hotel who pushed and punched a patron on the footpath outside the hotel, an allegation of a theft from a car parked in the hotel carpark, an incident in which a person had been requested to leave the licensed premises requiring the attendance of police, a complaint by bar staff that a person had damaged a poker machine, police attendance at the hotel over a patron who had refused to leave the hotel when requested by staff, attendance by police over an allegation that a patron had stolen property from a poker machine.

74 I have reviewed the detail of the information report summaries, mindful of the fact that it is not for this Court to assess the weight to be given to the materials by an authorised justice on an application under s.104A. On the other hand, if the material is not capable of meeting the threshold test to which reference has earlier been made, in particular was incapable of satisfying a reasonable person of the matters required by the statute, then plainly it is necessary for this Court to so find. On a review of the material, I am firmly of the opinion that the material was not capable of satisfying the three preconditions set out in s.104A and which have been referred to in paragraph [41] above. The material concerning the suspected drug activity to which I have earlier referred, was insufficient, as I have already stated, but it appears that that material may well have been the trigger or occasion for the making of the application. The other material concerning incidents involving assaults, brawls, arguments and the like, were not sufficient of themselves to satisfy the preconditions.

75 Part 8 of the Act, offences, set out discrete offences designed to render illegal activities involving violence and other anti-social behaviour. The Act specifically provides in s.145 for proceedings to be taken in respect of offences under the Act which may be disposed of summarily by the Licensing Court or by a Local Court constituted by a Magistrate sitting alone. The discrete or particular incidents to which I have referred which could constitute breaches of s.125 could have been made the subject of prosecutions under the Act. I do not, however, as I have already stated, consider that together such events satisfy the preconditions for the making of an order under s.104A of the Act.

76 It is clear there may be cases (eg., Elcham (supra)) where a number of incidents concerning drug activity, taken together, could form the basis for a conclusion that there was widespread possession, use and sale of prohibited drugs at licensed premises and that such a situation extended over a significant period. The material placed before the authorised justice, in this respect, however, fell within a relatively short period and, in my opinion, did not reveal that it occurred in circumstances and with a frequency that it could be said that a “blind eye” was being turned to such alleged activity or that the licensee permitted such to occur.

77 For the purposes of determining whether the jurisdiction under s.104A has been properly invoked this Court is required to examine whether there was any material capable of satisfying an authorised justice in terms of the section. The decisions in Elcham (supra) and the observations of Campbell, J. in Danesi (supra) are examples of this approach. In the latter case, Campbell, J. at [11] referred to the fact that what was termed “the scrap of information” provided as evidence of serious breach of the Act and relied upon in support of the application:-

“… disclosed nothing about there being any evidence which could even arguably have satisfied the magistrate that the licensee or any servant or any other person in charge had, or would have, the sort of knowledge or suspicion that sales, possession or use of what might be prohibited drugs was occurring on the premises, which is necessary for such sale, possession or use to be permitted . There was, therefore, a serious question to be tried that the Magistrate had acted without jurisdiction …”

78 For the reasons outlined above, the material in support of the application made to the authorised justice was incapable of satisfying the statutory conditions and that, accordingly, the order purportedly made pursuant to s.104A was made without jurisdiction.

(2) Procedural fairness in relation to s.104A orders

79 The conclusion which I have expressed in relation to the first ground (“jurisdiction”) is sufficient to dispose of the proceedings. However, by reason of the detailed submissions made on behalf of both the plaintiff and the defendant in relation to this second ground (“procedural fairness”), I consider that the parties are entitled to a decision of the Court on that ground. I will, at the end of this judgment, address the question of relief or remedy sought in these proceedings. It is sufficient at this point to observe that the only order sought (other than costs) by the plaintiff was a declaration that the s.104A order made on 4 November 2005 is void and of no effect. An order was not specifically sought quashing the order and the nature of the relief sought was confirmed in paragraph 1 of the “outline of the plaintiff’s submissions”. I do note, however, that on the first day of submissions, Mr. Heath referred to “the third issue is an order seeking to quash and/or stay the order permanently …” (t.2, 28 November 2005).

80 A person affected by an order made under s.104A of the Act does not have available a statutory right of review. Section 146 of the Liquor Act provides only for an appeal to the Supreme Court on questions of law from the Licensing Court. The Supreme Court, however, retains its power to grant prerogative relief.

81 The plaintiff’s essential argument is that the requirements of natural justice or procedural fairness apply to impose an obligation upon the defendant to provide at the time of service of an order made under s.104A, a copy of the materials used to support it. The plaintiff correctly argued that such rights were not removed by the Act so far as the possibility of applying to the Supreme Court for prerogative relief. Reliance was placed upon a similar argument to that propounded in the interlocutory application in Danesi, namely, that the refusal of police officers to supply the evidence on which they obtained the order had the effect of negating the right to apply for prerogative relief. This was argued upon the basis that the order, having almost immediate operation requiring closure of the hotel, meant that the refusal to provide a copy of the application and the supporting materials had the effect of making the order unreviewable for practical purposes. It was this, it was submitted, that constituted a serious procedural unfairness.

82 The plaintiff’s counsel was requested to identify the specific rule of procedural fairness relied upon and said to support the claim for relief. Counsel suggested that the right to be provided with the evidence supporting an application under s.104A of the Act was an extension of the right to be heard in relation to an order affecting private rights and interests.

83 Given the protection which the law has provided to decisions affecting property interests such as licenses and the concept of “fairness” or “a duty to act fairly” in actions taken in relation thereto, the holder of a licence under the Liquor Act may, generally speaking, be considered as having a legitimate interest in ascertaining the basis upon which a s.104A order has been obtained.

(a) General principles regulating the exercise of statutory powers

84 It is settled law that “when a statute confers power upon a public official to destroy, defeat or prejudice a person’s rights, interests or legitimate expectations, the rules of natural justice regulate the exercise of that power unless they are excluded by plain words of necessary intendment”: Annetts v. McCann (1990) 170 CLR 596 at 598, per Mason, CJ., Deane, and McHugh, JJ. See also FAI Insurances Limited v. Winneke (1982) 151 CLR 342 at 360 per Mason, J., at 376-377 per Aickin, J., at 395 per Wilson, J., at 412 per Brennan J; Kioa v. West (1985) 159 CLR 550 at 584 per Mason, J., at 632 per Deane, J.; Ainsworth v. Criminal Justice Commission (1992) 175 CLR 564 at 576, per Mason, CJ., Dawson, Toohey and Gaudron, JJ. Business or commercial reputation is an interest that attracts the protection of procedural fairness: Ainsworth (supra).

85 The plaintiff relied upon the principle that wherever a statutory power is exercised, it is presumed that the rules of procedural fairness apply unless there is a “clear manifestation of a contrary statutory intention”: Kioa (supra) at 584, per Mason, J. It is, accordingly, a matter of statutory construction whether the presumption in favour of the application of natural justice principles is expressly excluded by the statute or excluded by reason of necessary implication arising from the text of the statute: Kioa (supra) at 584 per Mason, J., at 601 per Wilson, J., at 609 and 619 per Brennan, J., at 632 per Deane, J. See also Mobil Oil Australia Pty. Limited v. Federal Commissioner of Taxation (1963) 113 CLR 475 at 503 to 504, per Kitto, J.

(b) Urgency and statutory rights of appeal

86 While considerations of urgency may limit the right to a hearing by modifying the rules of procedural fairness in a particular case, urgency alone will not necessarily constitute grounds for the denial of procedural fairness: Marine Hull and Liability Insurance Company Limited v. Hurford (1985) 10 FCR 234, per Wilcox, J.; Durayappah v. Fernando [1967] 2 AC 337 at 346.

87 In Marine Hull (supra), Wilcox, J. at 241 drew a distinction between “powers, which by their very nature, are inconsistent with an obligation to accord an opportunity to be heard” and powers that may on occasion, but not always, need to be exercised urgently in circumstances of emergency. In the former category of cases, the intention is to exclude a hearing.

88 In Danesi v. Commissioner of Police [2003] NSWSC 868, Campbell, J. at [5] accepted that the general circumstances in which an order under s.104A might be sought are circumstances of urgency. Given that understanding of s.104A and that s.104B allows for an order to be made by telephone, Campbell, J. took the view (at [5]) that it “may well have been the case that Parliament had, by implication, removed the requirement for adherence to natural justice” in the making of an order. Campbell, J. was not required to express a decided view on the matter, the proceedings relating only to the question of staying the s.104A order pending the hearing of an appeal in relation to the order. In Visalli v. Commissioner of Police [2001] NSWSC 360, Sperling, J. (at [7]) referred to the “stop-gap” role played by s.104A pending any further order made under s.104C, which would in effect continue the order made under s 104A.

89 It is clear that an application under s.104A may be made as a matter of urgency and in circumstances whereby a further order might thereafter be sought under s.104C to continue the effect of the short-term closure order made under s.104A. Section 104C provides that the Court may only make an order pursuant to that section if “the licensee has been given notice of the application for closure and has been given an opportunity to appear before the court and be heard in relation to the application” (s.104C(2)(b)). There is no maximum period for which an order under s.104C might operate, and s.104D provides that under s.104C the Court may grant two or more orders in respect of licensed premises.

90 The implication that arises from a comparison of the two provisions – s.104A and s.104C – is that the legislature did not intend that the principles of procedural fairness should apply to the making of an order under s.104A. However, given the potential detrimental effects of a closure order under s.104A on the business of a licensee and judicial concern that there is no “clear and effective procedure available for the rapid review of such an order and for a court to be in a position of suspending or terminating the operation of such an order at short notice in an appropriate case” (per Sperling, J. in Visalli (supra) at [16]), the question remains as to whether there is a duty to act fairly, in terms of an obligation to disclose to the person(s) affected, the basis upon which a statutory power has been exercised.

(c) The obligation to disclose the basis for the making of an order

91 As has been noted above, the Liquor Act makes no provision for a review of, or appeal against, an order made pursuant to s.104A. The right of appeal is limited, as observed, in paragraph [80] above. The absence of a statutory mechanism for challenging orders made under that section is potentially relevant to the question as to whether there is a basis for the implication of an obligation that, in enforcing an order made without notice under s.104A, there is a duty to act fairly. This issue arises in a context wherein there is a potential conflict between public and private interests. Hence in Elcham v. Commissioner of Police (2001) 53 NSWLR 7, O’Keefe, J. observed (at 15 [35]) that the purpose of s.104A is the protection of the public interest as defined in s.104A(3) by ensuring that licensed premises are conducted in accordance with the law and that such characterisation of the provisions necessitates “an approach to their construction which is beneficial rather than restrictive”. At the same time, O’Keefe, J. also acknowledged at [20] that the making of a s.104A order involves a significant intrusion on the business, personal and proprietary rights of a citizen. In consequence, there should be, as his Honour stated, a high degree of satisfaction in the mind of the authorised justice before acting under the section. O’Keefe, J. also observed (at 15 [35]) that because an order pursuant to s.104A is likely to have a detrimental effect on an hotelier licensee, the approach to be taken to the application of the section must recognise that (at 20 [59]):-

“Protection of the rights of the citizen is effected by the interposition of the authorised justice between the police and the citizen, and the recognition by the authorised justice of the duty which is imposed on such justice in applying the section.”

92 Bearing in mind the purpose and the operation of the section, O’Keefe, J. took the view (at 15 [35]) that the “approach by the authorised justice (and by the court) to the application of s.104A ought to be along the lines discussed in George v. Rockett (1990) 170 CLR 105 in relation to search warrants”.

93 Whilst it is true, as Mr. Spartalis for the defendant observed, that there exists no statutory obligation to provide the material utilised in obtaining an order under s.104A (or copies thereof) to a recipient of such an order at or shortly after service of such order, that is not, in my opinion, a complete answer.

94 There is nothing in the provisions of the Act which prohibits or limits a licensee from receiving a copy of the application for the order or the materials that were utilised in obtaining it. In the event that legal advice upon the validity of a s.104A order is sought or required but a copy of the application and related documents are not served with the order, the licensee affected by it will not be in a position to receive advice, prior to the commencement of proceedings, on the question whether or not the order was validly made. This situation arose and was acute in the present case. The plaintiff had no notice of the order, which took effect 15 minutes after service and had an operative period of 48 hours thereafter. The plaintiff, having been refused copies of the material upon which the making of the order depended, could not possibly have received informed legal advice before proceedings were commenced in this Court.

95 I do not consider, in this respect, as was argued for the defendant, that it is a sufficient answer to say that a licensee affected by a s.104A order may commence proceedings and issue a summons or notice to produce for the application and supporting material to be produced to this Court. A person affected by an order is not, absent statutory provisions prohibiting disclosure, to be encouraged or taken as being required to commence proceedings in this Court “on the blind”.

96 The question as to whether or not the duty to act fairly or any other discrete rule of procedural fairness requires an applicant for an order to serve copies of the application and supporting material, is not one upon which any specific authority has been cited in the course of argument. Indeed, there does not appear to be any authority precisely in point, although the judgment of the Supreme Court of Western Australia, Court of Appeal, considered in the paragraphs that follow does, in my opinion, provide guidance on the application of relevant principle.

97 In Bennett & Co. v. Director of Public Prosecutions for Western Australia [2005] WASCA 141, the Supreme Court of Western Australian made a freezing order pursuant to the Criminal Property Confiscation Act 2000 (WA). In respect of certain funds. The order was made as a result of an ex parte notice of originating motion for an examination order and a freezing order filed by the Director of Public Prosecutions in the Court. Three affidavits were filed in support of the application for the order. The application was heard ex parte pursuant to s.41(2) and s.57(2) of the last mentioned Act which provided that applications for freezing orders and for examination orders may be made ex parte.

98 Section 46 of the Act required that, as soon as practicable after a freezing order is made, the applicant must arrange for a copy of it, and a notice complying with s.46(6) of the Act to be served personally on any person who is, or may be, or claims to be, an “interested party”.

99 The Full Court of the Supreme Court of Western Australia observed that the statutory procedure differed from that which the Court would normally follow where an order is made ex parte in the exercise of the Court’s general jurisdiction. In that respect, the court stated:-

“… if an ex parte order were made in the exercise of its general jurisdiction, for example, it would require copies of the papers upon which the order was made to be served upon the party affected. The Court’s power to make orders of that kind is not expressly excluded, however.”

100 The Act in Bennett & Co permitted the Court to make an order prohibiting access to the documents used in the proceedings for a freezing order. However, no such order had been made.

101 The party affected by the freezing order (Centurion) wrote to the Director of Public Prosecutions and requested copies of the ex parte application and the affidavits in support in order to finalise their submissions. The Director’s reply consisted of a short statement including one to the effect that the relevant documents “will not be provided”.

102 In dealing with the question of Centurion’s right to access the freezing order affidavits, the Full Court stated that the fundamental principle to which regard must always be had was the following:-

“Natural justice requires that each party should have an equivalent right to be heard. This means that if one party wishes to place evidence or persuasive material before the Tribunal, the other party or parties must have an opportunity to see that material and, if they wish to submit counter material and, in any event, to address the Tribunal about the material. One party may not make secret communications to the court.”Pamplin v. Express Newspapers Limited (1985) 1 WLR 689 at 691

103 The Full Court at [44] went on to state that natural justice, in the sense of an opportunity to see the evidence put against a party, is a fundamental aspect of the judicial process. The Court additionally observed that there was nothing in the Act which purported to exclude the “very basic rule of natural justice to which we have referred”.

104 It is important, however, in identifying the principle involved in Bennett & Co. to have regard to the context in which the Court’s observations were made. In that respect, the following are noted:-

• The making of the freezing order arose in a statutory context which differed from the exercise of the Court’s general jurisdiction in the making of ex parte orders.

• The power to make freezing orders under s.43 of the Act was not one which had to be exercised if the relevant pre-conditions were established. Rather there was a discretion that could be exercised.

• A freezing order is draconian in its scope and natural justice would require that the party affected “be able at some stage to adduce evidence and make submissions affecting the exercise of the discretion …” (at [51]).

• The question in the case, in the context of the Act, was whether Centurion was able to exercise the right to “participate in proceedings” affecting its property as natural justice would require it to have without access to the affidavits used in obtaining the order.

• There were potentially four particular legal courses of action, in which such participation might take place. These included the provision (with leave) for an appeal against the imposition of a freezing order pursuant to s.61(1)(f) of the Supreme Court Act 1935 (WA) ( “Restrictions on appeals” ). That is, this was a possible course of action open to Centurion that was available outside the statutory scheme.

105 In the present case, the existence of a duty to act fairly or a right according to the principles of natural justice to be able to adduce evidence and make submissions presupposes that there is open to a party affected by a s.104A order the possibility of participating in proceedings that could result in an order setting it aside. In other words, it is difficult to see that there would be any right to be provided with a copy of the application and supporting material used to obtain the order if there was no avenue by which the party affected could challenge and participate in proceedings to attack the validity of an order made under s.104A.

106 In this respect, Campbell, J. in Danesi (supra) accepted at [11] that there was a serious question to be tried in relation to the argument put in that case. That argument was to the following effect. The requirements of natural justice were not removed so far as, inter alia, the possibility of applying to the Supreme Court for prerogative relief. Further, the refusal of the police officers to supply the evidence on which they had obtained the order had the effect of negating, inter alia, the right to apply for prerogative relief given the short-term nature of the order. The refusal to provide the evidence had the affect of making the order unreviewable for most practical purposes. The argument was, accordingly, that there existed a serious procedural unfairness.

107 The right to apply for prerogative relief in relation to a s.104A order would essentially depend upon the establishment of jurisdictional error. However if the materials relied upon in obtaining the order were such that there was no basis in law for the exercise of the power under s.104A, the person affected, who would require legal advice, would equally be subjected to procedural unfairness of the kind discussed in Bennett & Co. (supra). He or she would not have available in advance of commencing proceedings the materials that purported to validate the order.

108 The Court of Appeal in Bennett & Co. considered, as a matter of general principle, cases in which a party might have a right to have ex parte orders set aside on one basis or another. In this respect, it stated at [64] as follows:-

“Leaving aside for the present the particular matters raised by Centurion before Roberts-Smith, J., then, and turning rather to questions of general principle, ex parte orders may be set aside if it is demonstrated that there was material non-disclosure, or that on the basis of new material, the full facts and circumstances had not been appreciated, or that the order was made without jurisdiction: Bell Group NV (In liq.) v. Aspinall (1998) 19 WAR 561. If it was open to Centurion to apply to have the order set aside on the basis of either material non-disclosure, or on the basis that there were additional materials to which the Court was not directed at the time at which the order was made, it follows that Centurion must, in order to be able to make such an application effectively, know what material was disclosed to the Court at the time of the making of the order, so as to be able to point to any relevant omissions or to provide material to dispute or correct any assertions which it considered required disputing or correcting.”

109 The general principle to which the Full Court here referred as applied to interlocutory orders may, in my opinion, be extended to statutory orders affected by jurisdictional error. As earlier discussed, an examination of the application and supporting materials will usually be necessary before advice can be given as to whether or not jurisdiction to make the order under s.104A existed and the statutory power was validly invoked.

110 I am, accordingly, of the opinion that, there being no suggestion of public interest immunity attaching to the underlying materials or any other basis for withholding them, the plaintiff was entitled to be served with the application and a copy of the supporting materials and that the failure and later refusal to provide them constituted breaches of the obligation that existed to act fairly. These were not, of course, breaches in relation to the making of the order but in seeking to enforce it by a process that denied the party affected the opportunity of knowing the basis upon which the order was obtained. That, in turn, undermined the plaintiff’s ability to determine whether the order had been validly made. In other words, the power to enforce the order was exercised in breach of the duty to act fairly.

The discretion as to declaratory relief

111 Where an order is made under s.104A and there has been a refusal to supply copies of the application and supporting materials, it may be expected that in many if not most circumstances, this Court will, as in Danesi (supra) and as occurred in the present case, order a stay on the order and ancillary relief until copies of the materials are provided to the person affected.

112 The stay ordered in the present case operated effectively to protect the plaintiff’s interests against closure from the time the stay order operated. This Court has undoubted power to grant declaratory relief whether or not any consequential relief is or could be claimed: s.75 Supreme Court Act 1970; Ainsworth v. Criminal Justice Commission (1992) 175 CLR 564 per Mason, CJ., Dawson, Toohey and Gaudron, JJ. at 581-582. See also the Commonwealth of Australia v. Sterling Nicholas Duty Free Pty. Limited (1972) 126 CLR 297 per Barwick, CJ. at 305; Telstra Corporation Limited v. Australian Telecommunications Authority (1995) 133 ALR 417 per Lockhart, J. at 424-425; Aussie Airlines Pty. Limited v. Australian Airlines & Ors Limited (1996) 139 ALR 663 at 670-671 per Lockhart, J.; J.N. Taylor Holdings (In liq.) v. Bond (1993) 59 SASR 432 at 437 per King, CJ.

113 In Ainsworth (supra), Brennan, J. stated (at 596), the making of a declaration and the terms in which, if made, it should be framed are in the Court’s discretion. His Honour cited Chief Constable of North Wales Police v. Adams (1982) 1 WLR 1155 wherein Lord Brightman observed (at 1172):-

“It would, to my mind, be regrettable if a litigant who establishes that he has been legally wronged, and particularly in so important a matter as the pursuit of his chosen profession, has to be sent away from a court of justice empty-handed save for an order for the recoupment of the expense to which he has been put in establishing a barren victory.”

114 In the present proceedings, it might be open to argument that by reason of the requirement arising under the s.104A order for the hotel to be closed from 5.00 pm on 4 November 2005 until the stay order was made by this Court on 5 November 2005 that the plaintiff has in a sense been wronged by the making of the s.104A order and by its enforcement in breach of the defendant’s duty to act fairly in accordance with the determination which I have made.

115 There has been no submission made that, in the event that the grounds relied upon by the plaintiff were made out, the Court should exercise its discretion to refuse the making of the declaration sought. In circumstances in which an invalid order has adversely affected the plaintiff’s right to trade, even though on a limited basis and in circumstances in which a stay order was granted in respect if it, I consider that it is appropriate to exercise the discretion in favour of making a declaration as sought.

General observations upon the practice followed in enforcing s.104A orders

116 I make two remaining observations. The first is that there may be circumstances in which certain specific information contained within an application and supporting materials is such as to attract public interest immunity as, for example, where disclosure of the material might lead to the disclosure of the identity of a police informer. There may be other valid public interest immunity grounds in particular cases. In those classes of case, there would not exist an obligation to disclose such information. The second observation is that it will normally be in the interests of those seeking an order under s.104A to serve with the order a copy of the application and a copy of supporting materials for not to do so may well have the consequence, as occurred in Danesi and in the present circumstances, that the order will be met with an application for a stay order and ancillary relief which, if granted, can have the practical effect of negating, in whole or in part, the operation of an s.104A order. Accordingly, it would seem that, as a matter of general principle, exceptional cases apart, it is in the interests of both the person making the application for the order under s.104A and for the person affected, that a copy of the application and material be served with the order.

117 I have referred earlier in this judgment (paragraph [79]) to the nature of the relief sought in the summons and that no specific order was sought to quash the s.104A order. There are two observations to be made in relation thereto. The first is that the fact that the order was sought to be enforced, on the findings which I have made, in breach of the duty to act fairly is derivable from the reasons which have been stated in this judgment. Secondly, as noted in paragraph [79], although the summons was not amended to seek an order quashing the s.104A order, nonetheless that issue was raised in the course of submissions. However, in the circumstances of these proceedings, the making of an order by way of prerogative relief quashing the s.104A order may be said to be of little utility. I, however, reserve to the parties the right to make any further submissions on the question of whether any further relief can or should be granted within 14 days of the date of judgment.

118 For the reasons earlier stated, the plaintiff is entitled to a declaration essentially in the terms sought in the summons. I accordingly order and declare:-

That the order purportedly made pursuant to s.104A of the Liquor Act 1982 (NSW) addressed to the plaintiff, Benjamin Michael Ryan, in respect of premises known as Royal Hotel, Heber Street, Moree, dated 4 November 2005 is void and of no effect.

119 I reserve the question of costs in order to allow the parties to make any written submissions within 21 days of the date of this judgment.

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31/10/2006 - Correction to name of solicitor for first defendant - Paragraph(s) Cover sheet