SA Police v Temday Pty Ltd and Ors No. SCGRG 95/2499 Judgment No. 5425 Number of Pages 9 Liquor Licensing Corporations Law

[1996] SASC 5425

COURT IN THE SUPREME COURT OF SOUTH AUSTRALIA PERRY J

CWDS
Liquor licensing - summary offences - Complaint heard by court of summary jurisdiction alleging that the holder of a general facility licence permitted minors to enter and remain on the licensed premises in contravention of a condition of the licence - appeal by complainant against dismissal by the Chief Magistrate of the complaint on the ground that a breach of a condition unrelated to the sale, supply or consumption of liquor was not amenable to prosecution under s129(4) of the Liquor Licensing Act 1985 - held that there was no warrant to read s129(4) down so as to exclude breaches of licence conditions of that kind from summary prosecution - history of the licensing legislation referred to. Liquor Licensing Act 1985 ss124, 129(4) and 135; Licensing Act 1967; Licensing Act (1964) (UK); Liquor Act (1982) (NSW), referred to.

Corporations law - Leave to proceed with proceedings after liquidation order - held that an appeal against the dismissal ofa complaint in a court of summary jurisdiction could be heard and determined against a company which, before the hearing of the appeal, had been made the subject of an order for liquidation, and that no leave was required in accordance with s471B of the Corporations Law. Corporations Laws471B, referred to. Humber and Co v John Griffiths Cycle Company (1901) 85 LTR 141; R.A. Ringwood Pty Ltd v Lower
(1968) SASR 454; Re Timberland Ltd v Equitable Forestry Services Pty Ltd
(1976) VR 790, considered.

HRNG ADELAIDE, 10 January 1996 #DATE 18:1:1996 #ADD 11:3:1996

Counsel for appellant:             Mr M Stevens

Solicitors for appellant:            Crown Solicitor

Respondent Temday Pty Ltd:         No attendance

Respondent Nicola Domenico Nesci:    No attendance

Counsel for Colin John Bywaters:     Mr J D Claessen

Solicitor for Colin John Bywaters: Michael Giorgio

ORDER
Appeal allowed.

JUDGE1 PERRY J The appellant appeals against the dismissal of a complaint laid in the Magistrates Court alleging that the respondents were in breach of certain provisions of the Liquor Licensing Act 1985 ("the Act"). The complaint came on for hearing before the learned Chief Magistrate who dismissed it after hearing preliminary argument and before any evidence was called.

2. The charges as set out in the complaint are as follows (references to the first, second and third defendant may be read as references to the first, second and third respondents to the appeal):
    "1. On the 9th day of April 1996 at ADELAIDE in the said
    State the First Defendant being the holder of a General
    Facility Licence in respect of premises situated at
    88 Hindley Street and known as the Empire Entertainment
    Complex breached a condition of the licence in that Janelle
    Renee BUCKINGHAM and Rebecca Jane KENNEDY, both minors,
    entered or remained on part of those licensed premises.
Section 129(4) of the Liquor Licensing Act 1985.
    This is a Summary Offence.

It is further alleged that on the 9th day of April 1995
    Janelle Renee BUCKINGHAM, a minor was 16 years of age, and
    Rebecca Jane KENNEDY, a minor was 17 years of age.

2. IT IS FURTHER ALLEGED that on the 9th day of April 1995
    at ADELAIDE in the said State the Second Defendant was the
    manager of the premises in respect of which the said offence
    was committed.
Sections 129(4) and 135(b) of the Liquor Licensing Act 1985.
    This is a Summary Offence.

3. IT IS FURTHER ALLEGED that on the 9th day of April 1995
    at ADELAIDE in the said State the Third Defendant was a
    Director of the First Defendant, a body corporate.
Sections 129(4) and 135(a) of the Liquor Licensing Act 1995.
    This is a Summary Offence."

3. The second and third counts are derivative charges in the sense that they could not be made out unless the first count was proved.

4. To understand the preliminary point which was taken, it is important to note that the first count related only to the presence upon the licensed premises of the two young ladies referred to in that count and not to the sale, supply or consumption of liquor by either of them.

5. It was that circumstance which prompted counsel for the respondents to contend that having regard to the terms of s129 of the Act, there is no offence against sub-section (4) unless the alleged breach of condition is as to a condition relating to the sale, supply or consumption of liquor. It was that contention which was accepted by the learned Chief Magistrate, as a result of which he made the order of dismissal.

6. The respondents Temday Pty Ltd ("Temday") and Nicola Domenico Nesci, although duly served with the notice of appeal, did not appear at the hearing before me. I proceeded in their absence. Mr Claessen of counsel appeared for the respondent Colin John Bywaters.

7. I was informed that since the hearing of the complaint in the court below, the respondent Temday has been placed in liquidation. However, no formal evidence of this has been put before me.

8. Mr Stevens of counsel for the appellant contended that the liquidation order did not prevent me from proceeding with the hearing of the appeal as against that respondent, notwithstanding s471B(a) of the Corporations Law, and notwithstanding the fact that leave to proceed under the section had not been given. That section provides in part:
    "While a company is being wound up in insolvency or by the
    court ... a person cannot begin or proceed with:
    (a) a proceeding in a court against the company ... except
    with the leave of the court and in accordance with such
    terms (if any) as the court imposes."

9. Mr Stevens referred to Humber and Co v John Griffiths Cycle Company (1901) 85 LTR 141 and R.A. Ringwood Pty Ltd v Lower (1968) SASR 454.

10. Humber and Co concerned an appeal to the House of Lords by an unsuccessful defendant to an action by a company which went into liquidation after the trial of the action but before the appeal was heard. In that case, it was held that the company could not successfully contend that the appeal was a "proceeding" which could not be brought without leave within the meaning of a provision in the Companies Act (1862) (UK) corresponding with s471B(a) of the Corporations Law. That case concerned a very different situation, and I am not assisted greatly by it.

11. The decision in Ringwood v Lower is more pertinent. In that case, the Full Court held that complaints under the Road Maintenance (Contribution) Act 1963, heard in a court of summary jurisdiction, were not caught by the relevant provision in the Companies Act 1962: see per Walters J at 465 where he held that the application of the provision was limited to civil and not criminal proceedings. That view was adopted and applied in Re Timberland Ltd v Equitable Forestry Services Pty Ltd (1976) VR 790 (see per Dunn J at 791-2).

12. Insofar as this case concerns a complaint heard in a court of summary jurisdiction, in my opinion, the question whether it may properly proceed following the liquidation of Temday is concluded by the authority of Ringwood v Lower. Clearly, if the hearing and determination of the complaint itself did not involve the need to obtain leave under s471B(a), it could not be suggested that the hearing of an appeal against a dismissal of the complaint required such leave.

13. For those reasons, when the point was raised during the course of argument, I ruled in favour of Mr Stevens' contention.

14. The appellant advances two grounds of appeal. They are that:
    "(1) The learned Magistrate erred in holding that section
129(4) of the Liquor Licensing Act 1985 had no application
    to a condition of a licence which did not relate to the
    sale, supply or consumption of liquor.

(2) The learned Magistrate erred in holding that a breach
    of the licensing condition referred to in the complaint
would not constitute an offence against section 129(4) of
    the said Act."

15. S129 is contained in Division 1 of Part 10 of the Act. The heading to Division 1 is "Unlawful Sale and Supply of Liquor". The section is as follows:
    "129(1) A person who sells liquor without being licensed
    under this Act to do so is guilty of an offence.
    Penalty: Division 4 fine.

(2) A licensee who sells liquor otherwise than in
    accordance with the authorisation conferred by the licence
    is guilty of an offence.

(3) A licensee who supplies liquor to a person in or in the
    vicinity of his licensed premises in circumstances in which
    he would not be authorised to sell liquor to that person is
    guilty of an offence.

(4) If a condition of a licence is not complied with -
    (a) the licensee is guilty of an offence;
    and
    (b) if the condition regulates the consumption of liquor,
    the licensee and the person by whom the liquor is consumed
    are each guilty of an offence.

(5) A person who sells liquor by auction without a limited
    licence authorising him to do so is guilty of an offence."

16. In reaching the conclusion that s129(4) created an offence only if the licence condition said to have been breached was a condition relating to the sale, supply or consumption of liquor, the learned Chief Magistrate construed sub-section (4) in the context of s129 as a whole. In the course of doing so, he observed:
"Each of the sub-sections (1), (2), (3) and (5) of s129 deal
    with an aspect of unlawful sale or supply of liquor.
Section 129(1) creates the general offence of selling liquor
whilst not being licensed. Section 129(2) deals with sale
    by a person who is licensed but who sells otherwise than in
    accordance with the authorisation of the licence. Section
    129(3) deals with a licensee supplying liquor other than by
    sale in circumstances where he would not be authorised to
sell that liquor. Section 129(5) deals with the sale of
    liquor by auction. It is not obvious what sub-section (5)
    adds to sub-section (1) or sub-section (2). Mr Claessen
argues that s129(4) should be construed in the light of its
    accompanying provisions. That it would be surprising to see
    a penal provision which extends to a subject matter quite
    different from either the Division heading or the companion
    sub-sections."

17. The learned Chief Magistrate goes on in his reasons to accept the distinction put to him by counsel for the respondents between what was said to be the "authorisation" contained in a liquor licence and "subsequent conditions which qualify the authorisation".

18. It is certainly true that when one has regard to the provisions as to the various categories of licence set out in the Act, they almost invariably commence with a description of the activities authorised by the licence, followed by a statement of conditions to which the licence is subject. For example, s26, which deals with a hotel licence, states what the hotel licence authorises (s26(1)), and s27 goes to specify the conditions to which such a licence is subject. A similar format is followed in the sections providing for the other classes of licence specified in Part 3 Division 1 of the Act.

19. In addition to the general conditions necessarily attaching to a particular class of licence, a specific condition or conditions may be imposed with respect to any licence, pursuant to the discretion conferred by s50 of the Act.

20. With respect to the learned Chief Magistrate, I doubt the soundness of his attempt to make any meaningful distinction between what is "authorised" and what is proscribed by condition. It seems to me that if an authorisation is conditioned by an express condition, it is as much a breach of the authorisation as it is of the condition for a sale of liquor or other proscribed activity to take place contrary to the condition.

21. If I am right in that conclusion, this suggests not only that there might be an overlap between the operation of subsections (2) and (4) in cases where the offence is constituted by a sale in breach of a condition, but it also suggests that the "condition" in subsection (4) must be taken to extend to a condition relating to matters other than transactions involving a sale of liquor.

22. Be that as it may, the fact that all of the sub-sections of s129 other than sub-section (4) deal in one way or another with the sale or supply of liquor led the learned Chief Magistrate to the view that it was only a breach of the condition of the licence of a similar kind, that is, a condition relating to sale or supply of liquor (and, having regard to subsection (4)(b), the consumption of liquor) which was caught by s129(4).

23. In my opinion, in adopting such a construction of the section, the learned Chief Magistrate fell into error.

24. One consequence of such an analysis is that breaches of conditions other than those which relate to the sale or supply of liquor could then only be dealt with pursuant to the disciplinary jurisdiction conferred on the Licensing Court by s124 of the Act.

25. True it is that s124(3)(e) specifically provides that the contravention or failure to comply with a condition of the licence exposes the licensee to disciplinary action pursuant to the section. But that does not assist the respondents' contention. The generality of the matters comprehended by s124 is such that a breach of any of the subsections of s129 might properly be made the subject of disciplinary action under s124, whatever construction of s129(4) is adopted, and even if such a breach might expose the licensee to a liability to prosecution for an offence under s129.

26. Conditions attaching to licences issued pursuant to the Act, either being conditions which expressly attach to licences of the class in question or which may be imposed with respect to a particular licence pursuant to s50, may relate to important aspects of the operation of the licence, the policing of which by penal sanctions may be very much in the public interest.

27. Conditions attaching to a general facility licence may be of greater significance than conditions attaching to the other classes of licence provided for in the Act. This is because the very character of a general facility licence is fashioned by reference to what are perceived to be special trading conditions necessary for the various purposes enumerated in s44(1).

28. S43 provides that a general facility licence authorises the licensee to sell liquor on the licensed premises:
    "(a) at such times as are specified in the licence;
    and
    (b) subject to such conditions as are specified in the
    licence."

29. It follows that almost the whole of the nature and scope of operation of the general facility licence must find expression in the conditions. In those circumstances it would be a strange result if a breach of conditions which might properly be regarded as central to the proper exercise of the licence could only expose the licensee to disciplinary as opposed to penal consequences.

30. In any event, the distinction between conditions which relate to the sale, supply or consumption of liquor and conditions which do not answer to that character is, in my opinion, an artificial one. For example, the condition in question, which represents an attempt to ensure that minors will not be present on the licensed premises, can only sensibly be characterised as a provision in aid of preventing the sale or disposal of liquor to minors, which itself is an offence (s118 of the Act).

31. In my opinion, there is no reason to read down the application of s129(4) in the manner suggested by the respondents. To approach the matter in that manner would result in a most haphazard and uneven enforcement of the obligations attaching to a licence, dependent, in the case of an alleged breach of condition, upon the characterisation of the condition, as one relating to the sale, supply or consumption of liquor as opposed to one not capable of being so characterised, an exercise which, for the reasons I have given, is of dubious validity.

32. In reaching the conclusion which he did, the learned Chief Magistrate sought to distinguish the decision of this Court in Marta Investments Pty Ltd v Roberts (1991) 162 LSJS 78. In that case, Olsson J dismissed an appeal against a conviction recorded against the holder of a general facility licence, the offence being a breach of a condition of the licence, providing that "a minor may not enter or remain in any part of the licensed premises between 12 midnight and 5.00 am on any day upon which the premises are authorised to trade". In dismissing the appeal, Olsson J principally had regard to the argument that in that case the offence was wrongly characterised as a "strict offence" not requiring proof of mens rea.

33. While the learned Chief Magistrate was correct in holding that Marta Investments did not involve the necessity to address the question now at issue, and was in that sense not determinative of that question, Olsson J did observe during the course of his judgment (81):
"The net effect of the Act, properly construed, is that
    licences of the relevant type may have conditions attached
    to them and it is the positive obligation of the licensee
under section 129(4) to ensure that all such conditions are
complied with ... (83) ... Section 129 of the Act ... is one
of a complex of provisions of the Act which, inter alia and
    given the terms of condition 6 of the licence, are designed
    to prohibit supply of liquor to minors."

34. As to the latter observation, the learned Chief Magistrate remarked, during the course of his reasons:
    "For my part, I have some difficulty in seeing how the
    supply of liquor to minors might be more readily controlled
    by permitting minors to be on premises until midnight and
    not after that hour. The condition seems more directed to
    broader issues of the undesirability of minors remaining on
    licensed premises into the early hours of the morning."

35. With respect to the learned Chief Magistrate, I do not think that that comment is either appropriate or otherwise warranted. There may well be particular difficulties associated with the supply of liquor to minors after midnight which are not so acute at times before then.

36. In his reasons for decision, the learned Chief Magistrate refers to various types of conditions which either attach by operation of law to certain classes of licence, or might be imposed in the exercised of the discretion of the Licensing Court, in both cases, being conditions which he suggested might be "more appropriately" dealt with by an exercise of the court's disciplinary powers under s124 rather than by prosecution under s129. In that category, he refers to a condition that the licensee provide accommodation or meals (s27), that the licensee maintain the premises "so as to ensure that they do not cease to be of an exceptionally high standard" (s33(2)(a)), that liquor to be sold pursuant to a restricted club licence be purchased only from the holder of an hotel licence or a retail liquor merchant's licence (s34(2)(a)), conditions relating to the level of noise emanating from licensed premises (s50), and conditions relating to the safety and comfort of patrons (s50).

37. The suggestion that conditions of that kind are intrinsically more appropriately dealt with by disciplinary rather than penal provisions does not stand analysis against the history of licensing legislation, either in this State, other States of Australia or in the United Kingdom. If, for example, one has regard to the predecessor to the Liquor Licensing Act 1985, namely, the 1967 Licensing Act, there are very many provisions in it which provide that a variety of acts or omissions on the part of a licensee, totally divorced from the immediate activity of sale, supply or consumption of liquor, were defined as offences subject to specific penalties. In that category, for example was the obligation to display the name of the licensee on the front of the licensed house (s118), waging or gaming on licensed premises (s124), use of the premises as a theatre, concert room or ballroom without a permit (s131), a duty to put up in the licensed premises signs setting out the provisions of various sections of the Act (s132), a restriction on keeping retail stores together with licensed premises (s133), employing prohibited persons as managers (s140), employing persons under the age of 21 years (s154), allowing any part of the licensed premises to be unlocked out of hours (s159), maintenance of a register of lodgers (s161), a duty to supply food and lodging (s168), allowing persons to be unlawfully on the premises outside of hours (s175 and s176), and hindering an inspector in making a search of the premises (s182). Other examples could be given. I do not pause to refer to similar provisions to be found in other jurisdictions such as in the LiquorAct 1982 (New South Wales) or the provisions of the Licensing Act (1964) (UK).

38. It is inconceivable to think that in the transition from the 1967 to the 1985 Licensing Act in this State the legislation could be taken to have intended to sweep away from the purview of courts of summary jurisdiction the exercise of the long-standing penal jurisdiction conferred by sections of the kind to which I have referred, without more specific language making such an intention plain.

39. On the contrary, for the reasons which I have given, all that has happened is that a different structure and wording has been adopted to achieve the same result.

40. There is no warrant for confining the operation of s129(4) to breaches of a condition of the class suggested by the learned Chief Magistrate.

41. It is true, as he pointed out, that pursuant to s19 of the ActsInterpretation Act, the heading to Division 1, "Unlawful Sale and Supply of Liquor" forms part of the Act. But the words in s129(4) must be construed in the context of the Act as a whole, not only their immediate context. Furthermore, any inference to be drawn from divisional headings cannot prevail over the plain meaning of an unambiguous expression.

42. True it is that in the case of a penal provision, an ambiguity may properly be resolved in favour of the defendant. But here there was no ambiguity. One starts with the proposition that words are taken to mean what they say. If the words are plain, that is an end of the matter. The words "If a condition of a licence is not complied with ... the licensee is guilty of an offence" are plain and unambiguous. They are words of general import, and the learned Chief Magistrate's gloss on them resulted from an unwarranted distraction by their immediate context.

43. In my opinion, properly construed, s129(4) is of application to a breach of a condition of any kind attaching to any class of licence. The ordinary and natural meaning of the words to be found in the sub-section are not to over-ridden by considerations of the kind referred to by the learned Chief Magistrate.

44. I should say that I am not deflected from reaching that conclusion by reason of the amendment effected by Act No 31 of 1995, which commenced on 1 July 1995, as a result of which subsection 119A(1)(ab) was inserted into the Act. That subsection provides that a minor may not enter or remain in
    "... licensed premises in respect of which a general
    facility licence is in force at any time between midnight
    and 5.00 am on any day, not being a designated dining area
    or an area approved by the licensing authority for the
    purposes of this section".

45. Under s119A(3a), the licensee charged with an offence under the section has a defence if the licensee proves that he or she took reasonable steps to remove, or prevent entry of, the minor.

46. That condition was not, of course, in force at the time the offence in question was alleged to have been committed. But even if it had been, the fact that a defence might be available in answer to a charge under that subsection but not if the entry or presence of the minor is in breach of a condition as to which a charge might be brought under s129(4), is nothing to the point. S129(4) is clearly intended to apply to breaches of conditions of all kinds, not only conditions restricting admission of minors to licensed premises. The fact that there might, in a particular case, be some tension in the operation of the two sections due to a degree of overlap in their potential operation is no warrant for confining the scope of s129(4) in the manner suggested by the learned Chief Magistrate.

47. For these reasons, the order of dismissal must be quashed and the complaint remitted to the learned Chief Magistrate, or any other Magistrate to whom it is assigned, for hearing and determination in accordance with these reasons.