Woolies Liquor Stores Pty Ltd v Port Pirie Licence Victuallers Association

[1993] HCATrans 249

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Adelaide No Al8 of 1993

B e t w e e n -

WOOLIES LIQUOR STORES PTY LTD

Applicant

and

PORT PIRIE LICENCE VICTUALLERS
ASSOCIATION, HOTEL AND
HOSPITALITY INDUSTRY
ASSOCIATION, and THE LIQUOR

LICENSING COMMISSION

Respondents

Application for special leave

to appeal

DAWSON J

TOOHEY J

Woolies 1 26/8/93

MCHUGH J

TRANSCRIPT OF PROCEEDINGS

FROM ADELAIDE BY VIDEO LINK TO CANBERRA

ON THURSDAY, 26 AUGUS·T 1993, AT 11.04 AM

Copyright in the High Court of Australia

MR J.R. MANSFIELD, OC:  May it please the Court, I appear

with my learned friend, MR B.F. BEAZLEY, for the

applicant. (instructed by Phillips Fox)

MR J.L. FIRTH:  May it please the Court, I appear for the

first two respondents. (instructed by Kelly & Co).

DAWSON J: Yes. I should intimate that the Deputy Registrar

has been informed by the Crown Solicitor's Office

of South Australia, solicitors for the third

respondent, the Liquor Licensing Commission, that

they do not intend to appear in the hearing of the

special leave application in this matter and will

abide by any order of the Court, save as to costs.

MR MANSFIELD:  May it please the Court, we have provided an

outline of argument on this application, and have

attached to it simply, hopefully, to assist the

Court, copies of some of the sections in the

Liquor Licensing Act of South Australia.

The significant issue which, in our respectful

submission, is the issue upon which leave ought to

be granted in this matter, arises in an application

for the removal of an existing bottle shop licence

from one location in a locality to another location

within the same locality. That sort of concept is

one which is very common in licensing legislation

around Australia, whether it is called a locality

or a neighbourhood.

The issue of general importance, in our

submission, is whether price competition, in which

the applicant for the removal might engaged, is

properly a reason for determining that the

application should not succeed.

McHUGH J: But that issue does not arise, does it?

MR MANSFIELD:  With respect, Your Honour, it is our

submission that it does.

McHUGH J: Before you get to that issue, you have got to

overturn the finding that the applicant has failed

to overcome the need element of section 67.

MR MANSFIELD:  Your Honour, we accept that, but as you will

see in page 2 of the summary of the submission and,

in particular, the second part of page 2, we have

sought to address that because we accept that there

are the two-stage process. There is the section 67 question and section 61 or discretionary provision.

TOOHEY J: But it is not merely a two-stage process. In a

sense, you can discount everything that has been

said about aggressive price war, and you still have

Woolies 2 26/8/93

a judgment that is against you. So, as it were,

to come in the back door and attack the last part

does not help you very much unless you can show good reason why this Court should grant special

leave in respect of the first matter.

MR MANSFIELD: Well, we accept that too, if Your Honour

pleases, and the submission we make is this.

Section 67 is a section which in more or less

similar terms finds expression in other licensing

legislation around Australia. We have, in the

submission, referred to that but I can give the

Court references, if necessary, to the provisions

in the legislation in New South Wales, Queensland,

Victoria and Western Australia where, more or less, the same provisions apply - - -

DAWSON J:  Can I just interrupt you for a moment,

Mr Mansfield? Do you dispute the interpretation of

section 67 which was given by the Full Court?

MR MANSFIELD: Yes, we do, Your Honour.

DAWSON J:  You do.

MR MANSFIELD: Perhaps I can direct the Court's attention to

the two very short points which developed that

proposition, at the bottom of page 2 of the

submission. The submission, which we put, is that

section 67 in the South Australian legislation, and

comparable provisions in the other legislation, do

not apply in respect of removals from one licensed

premise in a locality to another licensed premise

within the same locality.

TOOHEY J:  Would it be right to say, Mr Mansfield, that the

licensing court in South Australia precedes, and

has preceded on the past, on the basis that

section 67 applies whether the removal is within

the same locality or to premises in another

locality?

MR MANSFIELD: 

In our submission, it would not be quite

right to say that, Your Honour, for this reason.
As the Court may be aware there are two hurdles to

removal applications generally.  One is under.

section 38 of the Act, which is generally regarded

as the harder hurdle, and the second under

section 67 of the Act. In terms of removals within
localities the Full Court has recently, in the
decision of Pandelis, to which reference is made,

decided that the section 38 hurdle did not apply to
removals within a locality, even though the

subsection which gave a 500 metre exemption zone

was expressed as a proviso.  So that the focus on

section 67 as relevant to removals within a

locality has not really existed up until after the

Woolies 3 26/8/93

Pandelis decision. So, the answer to Your Honour's

question, really, is no, it has not been much of a

focus in removals.

McHUGH J: But, the existence of section 38(2) makes it very

difficult, does it not, to argue that section 67

does not apply in a situation like this?

MR MANSFIELD:  In the Pandelis decision, which was a

decision of the Full Court in South Australia, the

decision was that although you were removing,

within a locality, but more than 500 metres from

the existing licensed premise. In other words,
although subsection (2) did not apply, never the
less, section 38 did not apply to removals within

the same locality.

That was another case where there was a

removal from one location in a country town to

another location in a country town, in that case

Whyalla - it was a removal of, from memory, about

two kilometres, and Pandelis decided subsection (2)

did not limit section 38(1) and section 38(1) did

not apply to removals within the same locality. So

the issue is a new one in the sense that it has not

cropped before in a specific circumstance, because

previously until the Pandelis decision the focus

upon section 67 did not arise.

As far as we can determine, having examined

legislation around Australia and cases under that

legislation, there is no decision of any court,

other than this one, as to whether section 67, or

its more or less analogues interstate, does apply

to removal within the locality. The significance,

in our submission, as the summary proposes, is that

if it does apply, a licensed person might otherwise

be restricted, even by removing within to the

next-door premise, from serving the public interest

to the full tenor of the licence by wanting to

engage in competitive pricing in the market. We therefore submit that there is a

significant and important issue to decide as to

whether section 67 applies to removals within a

locality. I should also just put - - -

DAWSON J:  It might be important, but why was the Full Court

wrong?

MR MANSFIELD:  In our respectful submission the Full Court

was wrong because the consequence of the decision

is that in a removal application the court, whether

it be from one place to the place next door, or
from one place to a distance within the same

locality, the court was looking to how the proposed

applicant, or the applicant presently conducting

Woolies 26/8/93

that licensed premise, might conduct a licensed

premise in a different part of the locality, even

next door, specifically with respect to price

competition, to see whether it should or should not

be allowed.

Although I accepted initially the proposition,

and I still maintain that there are the two

questions, the judgment of the licensing court,

which was very largely simply adopted by

Their Honours in the Full Court on the facts, makes

that consequence quite clear, because, if I may

direct the Court's attention to the appeal book,

page 3, about line 25, in terms of public need, the

court finds, and this is a finding which the

Full Court developed or accepted, that the existing

premise from which this licence is being operated

is not good enough there to meet the public needs

generally in the locality. It is too small; it

cannot have enough shelf space; it is too

inconvenient; there are parking problems, and the

like. And on the other hand, there are a lot of

people in the locality who would like the benefit

of one-stop shopping. So that, taking public needs

simpliciter, as that was approached, the court

found that that need was established. But the

court then went on to consider other facilities in

the locality to see whether, despite that public

need, they were being met at present.

Now, there is, in our submission - and I

really confess to digressing, in a sense, to a
question of fact - an inconsistency in that the
conclusion then that public need was being
adequately met with the finding that price

competition, which was feared, would very

significantly change the way in which people

shopped in the locality. One can see that from the

conclusions at page 7 and 8 of the appeal book.

Perhaps at line 45 and following, His Honour the

licensing court judge - and again, a passage which

the Full Court simply adopted in its approach -

found that if the removal was granted, and the

licence transferred to the applicant here, there

might very well be some price competition. The

consequences of price competition would be to take

a great deal of business away from other licences,

simply because of the one-stop shopping.

The large paragraph on page 8 of the appeal

book shows, quite clearly, that the licensing court

had the view, there being this need simplicita,

that the public would very readily adopt to it.
Now, in our respectful submission, it is apparent

from those two passages of findings of fact that the need in terms of section 67 in any event was

met, but it demonstrates, by way of the alternative

Woolies	26/8/93 and, perhaps more legal proposition that we seek to
develop, that section 67, if it is construed in a
way that inhibits a licensed person within the locality from fulfilling the intent of that licence by serving the public interest, as the finding
clearly does, it is an inappropriate construction.

So that both in terms of looking at price

competition as relevant to the exercise of the
discretion or as looking at the consequence of the

findings of fact in terms of section 67, to say

that it does not apply to a removal within the

locality, because it is then used as an impediment

to the licence fulfilling the public interest which
it is intended to fulfil within the locality, we

say they are both important issues in respect of

which the Court we ask to give leave.

If the Court pleases, I do not know whether

there is point much in developing the argument to say that price competition is something which the courts below did have regard to in exercising

discretion adversely to the applicant. The

passages are at pages 7 and 8 of the appeal book,

and in the Full Court decisions at pages 18 and 19
in the judgment of His Honour Justice Duggan, and

page 32 in the judgment of Justice Matheson, make

it quite plain that Their Honours did have regard
to the proposed, or the potential, for this

applicant to engage in competitive pricing as

relevant to the exercise of the discretion not to

grant the removal.

In our submission, as a matter of law, that is

simply not correct. There are, of course, very

fundamental provisions in the Trade Practices Act

and in Fair Trading Acts around Australia now,

supporting the proposition of competition. There

are, and have been, significant changes in this

legislation compared to previous legislation which

enabled minimum pricing under.the Prices Act and in

other respects. In our respectful submission,

provided one does meet the fit and proper person

test to be a licensed person, it would be

inconsistent with the provisions of the Act not to

allow the public interest to be served by a

licensed person then engaging in the market-place
in competitive pricing if that person chose to do

so.

TOOHEY J:  Mr Mansfield, is it your· submission that subject

to the operation of section 38 in relation to a

retail liquor merchant's licence, section 67 has

nothing to say about the removal of licensed

premises within the same locality?

MR MANSFIELD:	Yes, Your Honour, that is our submission.
Woolies	26/8/93
TOOHEY J:	Does it follow from that that there are no

restraints in the Act upon the removal of a

licensed premises from one set of premises to

another?

MR MANSFIELD: 

No, it does not follow from that necessarily

that there are no restraints because the court -
there are other grounds upon which the court might

exercise its discretion not to approve a removal to

a particular site within a locality, factors which

one might describe generally as environmental

factors.

TOOHEY J: Where are they to be found?

MR MANSFIELD: Section 62, in respect of requirements

generally as to premises for new applications, and

section 68 in respect of removals to proposed

premises and, in our respectful submission,

generally section 59 discretionary section would

enable those sorts of considerations to be had in

regard to when considering an application for a new

licence or a removal licence in any event.

TOOHEY J: But would you not have to read section 59 down to

say that the needs of the area, of the particular

area, were not a relevant consideration where there

is removal within the same locality?

MR MANSFIELD:  It is our argument that you have to read

section 59 down to say you cannot use price

competition as a reason not to approve an

application, but we do not say that you cannot use

section 59 discretion to consider environmental

factors, such as the premise being unsuitable or

that it is one where there is going to be undue

inconvenience to residents next door, for instance,

or the planning considerations because that would

be consistent - - -

TOOHEY J:  No, that was not my question. My question was

related directly to the needs concept in the Act

and whether section 59 itself permits that to be

taken into account or whether, having regard to
your construction of section 67, it is not a

relevant consideration.

MR MANSFIELD:  I am sorry, I misunderstood Your Honour's

question. The answer is that we would submit that

section 59 does not enable the needs concept to be

considered in terms of the discretion to not allow

a removal within a locality if otherwise the

discretionary consideration supported it.

TOOHEY J: Yes, thank you.

MR MANSFIELD:	If the Court pleases, that is our submission.
Woolies	26/8/93

DAWSON J: Yes, Mr Firth. You can restrict your submissions

to the operation of section 67.

MR FIRTH: Thank you, Your Honour. If the Court pleases,

what my friend is contending really flies in the

face of what section 67 says. The wording of the

section is quite clear and on the face of it would

apply equally to a situation where the proposed

move is from within the locality to another point

in the same locality or whether it is over a

greater distance to another locality. It seems to

me that if my friend's construction is correct,

then section 67 really has no work to do at all in

situations such as the present case, and that

simply cannot be right.

Section 59 is an unqualified discretion

subject to the Act. It seems to me section 67

deals specifically with the important concept of

need. It applies to all removals of all category·A
licences regardless of the distance, and there is

no differentiation under section 67, as there is in

section 38, between moves over one distance or

another.

So it seems to me it simply flies in the face

of what the section so clearly says, to argue for

what my friend contends, and I think the Full Court

really adopted a similar approach. They found that

section 67 must have work to do in both types of

situations, the present one and a larger move, and

that the court below had adopted a sensible

approach, had looked at the question of present day

needs, taking into account the existing licence

which was going to move and the others within the

locality and simply said that having regard to the

existing licences, there is no need. That is what

the section seems to require the licensing court to

do. The specialist judge did that. The Full Court

said he adopted the correct approach and unless

this Court were convinced that that was clearly a

wrong approach and also a question of substantial

importance, leave should be refused.

TOOHEY J:  Mr Firth, what does the Act say about locality?

Does it define the term?

MR FIRTH:	No, it does not define the term and in fact never has defined the term, even in the predecessor
legislation.

DAWSON J: But it was common ground in this case that

Port Pirie is a locality.

MR FIRTH: Yes, that was so; there was no issue at all. The

whole of Port Pirie was the locality and therefore

the court could look at all of the existing

woolies 26/8/93

facilities, liquor stores and hotels throughout the

whole of that locality, some of which were very

close and some of which were spread out.

I do not think I can address the Court further

on that particular point other than to say that on

the facts of this particular case, it is not a

situation that is likely to arise very often. It

is a combination here of somebody saying, "I want

to buy an existing licence and move it a short

distance, move it into a supermarket in a country

town where, on the facts before the licensing court

who had all the financial figures, the existing

premises were in difficulty, there was a recession,

the population was down, unemployment was up, and

it was an unusual fact situation not likely to

occur again." So I say it is not really a question

of public general importance likely to arise again.

DAWSON J:  Thank you, Mr Firth. Mr Mansfield, do you have

anything to say in reply?

MR MANSFIELD:	No, if the Court pleases.
DAWSON J:	The decision of the Full Court concerning the

scope of section 67 of the Liquor Licensing Act and

its application in this case is not attended with

sufficient doubt to warrant the grant of special

leave to appeal. In those circumstances, it would

not be appropriate to grant special leave to

consider the other matters which the applicant

seeks to raise. Special leave to appeal is

refused.

MR FIRTH: If the Court pleases, I make application for

costs.

MR MANSFIELD:  We do not oppose that, if the Court pleases.

DAWSON J: Special leave to appeal is refused, with costs.

AT 11.26 AM THE MATTER WAS ADJOURNED SINE DIE

Woolies 9 26/8/93