Air Rescue Services Limited v Secretary for Internal Affairs
[2015] NZHC 741
•17 April 2015
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV 2015-485-183 [2015] NZHC 741
UNDER the Judicature Amendment Act 1972 IN THE MATTER
of an application for Judicial Review of a decision under the Gambling Act 2003
BETWEEN
AIR RESCUE SERVICES LIMITED Applicant
AND
THE SECRETARY FOR INTERNAL AFFAIRS
Respondent
Hearing: 9 March 2015 Counsel:
M A J Elliott and S T Cottrell for Applicant
J S Andrew and V M Scott for RespondentJudgment:
17 April 2015
JUDGMENT OF BROWN J
[1] The applicant’s application for a class 4 venue licence pursuant to the
Gambling Act 2003 (the Act) in respect of Robbie’s Bar & Bistro (Robbie’s) dated
14 February 2014 was declined by the respondent on 16 October 2014. The applicant lodged an appeal against that refusal to the Gambling Commission but was advised that its appeal could not be heard before 30 March 2015. Because the most recently held venue licence for Robbie’s expired on 11 September 2014, more than six months would therefore elapse before the outcome of the applicant’s appeal was
known.
AIR RESCUE SERVICES LTD v THE SECRETARY FOR INTERNAL AFFAIRS [2015] NZHC 741 [17 April
2015]
[2] It was that passage of time that prompted this application for review, and in particular the interim order sought, because Robbie’s is a venue in respect of which a class 4 venue licence had been held since 17 October 2001. Consequently s 92 of the Act (which preserves an entitlement to the number of gaming machines at a venue) is material:
92Limit on number of gaming machines for which class 4 venue licence held on 17 October 2001
(1) This section applies to a class 4 venue for which—
(a) a class 4 venue licence was held on 17 October 2001; and
(b) there has not been a period of 6 months or more since 17
October 2001 when no class 4 venue licence was held.
(2) A society must not operate more than 18 gaming machines at a class
4 venue.
[3] The applicant’s understandable concern was that if the six month period elapsed then, in the event that its appeal succeeded, it would have no right to maintain 18 gaming machines. Its position would then be governed by s 94:
94Limit on number of gaming machines for venue with venue licence granted after commencement
(1) This section applies to a class 4 venue—
(a) to which section 92 does not apply; and
(b) for which a class 4 venue licence is granted after the commencement of this section.
(2) A corporate society must not operate at a class 4 venue more than the greater of—
(a) 9 gaming machines; or
(b) the number of gaming machines approved by the Minister under section 96.
[4] In order to avoid the period in s 92(1)(b) elapsing, which would deprive the applicant of the “right” to operate 18 gaming machines at Robbie’s in the event that it succeeded in obtaining a venue licence, the applicant sought the following interim order in the nature of mandamus to the respondent:
The [respondent] orders a class 4 venue licence to Air Rescue Services Ltd by no later than 10 March 2015 with respect to the venue known as Robbie’s Bar & Bistro Belfast at 812 Main North Road, Belfast, Christchurch for a period of one day only.
[5] Because the application sought an order by no later than the day following the hearing, at the conclusion of the hearing I ruled on the application, providing brief reasons with a written judgment to follow. I said:
I decline the application. Because of the reason or the primary reasons for my declining it, I wish to write a reasoned judgment rather than the short oral judgment that today’s timing permits. However there is a right of appeal available from my judgment and it’s only proper that I indicate what has been a primary consideration in my conclusions so that if the applicant wishes to consider an appeal it has the benefit of that statement of view.
Accordingly I say this. Having regard to the purpose and structure of the Gambling Act 2003, including provisions that licences (both operator and venue) which are cancelled or suspended shall continue in effect pending determination of appeal whereas there is no equivalent provision for unsuccessful applications for licences (which is said by the applicant to have been a gap in the statute) and having regard also to the fact that it is common ground that on allowing an appeal the Gambling Commission has the power to backdate a licence to commence within the six month period referred to in s 92(1)(b), I do not consider that it is appropriate to grant relief of the nature of that sought, namely a one day licence which would have the effect, and indeed the purpose, of preventing the timeframe event provided for in s 92(1)(b), namely the lapse of time of more than six months without a venue licence being in force.
[6] With reference to these reasons for judgment, I note two points. First, I do not find it necessary in the circumstances to fully recite counsel’s arguments although, as I commented at the conclusion of the hearing, the arguments advanced for both sides were of high quality and I am grateful to counsel for their assistance.
[7] Secondly, I raised with Mr Elliott in the course of his submissions my concern about the risk, in this scenario of parallel review and appeal processes, that a judgment on an interlocutory application on review might have some influence on the Tribunal in its consideration of the appeal. I reserved leave to the parties to file memoranda with reference to the scope of my written reasons for judgment.
[8] Subsequently the appellant filed a memorandum inviting the Court to refrain from commenting on the substantive matters to be considered on the appeal, including the issues of arguable case. The respondent filed a memorandum stating
that it had no issue with the course proposed by the appellant. In those circumstances I will not address in this judgment the issue of arguable case.
Factual background
[9] The following facts are not in dispute, having been admitted in the statement of defence:
· Robbie’s Bar & Bistro Belfast, was originally licensed under the Gaming and Lotteries Act 1977. The venue licence was held for the venue on
17 October 2001 and subsequently.
· The number of gaming machines notified to the Secretary under section 89 of the Act was 18 and accordingly up to 18 gaming machines may be operated at the venue, subject to a venue licence being held for the venue.
· Between April 2004 and February 2011, the Eureka Trust held a licence for the venue. Between March 2011 and September 2012, Bendigo Valley Sports held a licence for the venue. On 12 August 2012 Blue Grass Trust applied for a licence for the venue. Blue Grass Trust was granted a licence for the venue on 11 September 2012. Blue Grass Trust’s licence expired on 11 September 2014.
· The applicant applied for a licence for the venue on 14 February 2014.
The application named Wayne Owen Nutbrown as the venue manager and as the sole director and shareholder of the venue operator company, WON Investments Ltd.
· In a decision dated 1 August 2014, the Commission declined an appeal against a decision by the respondent cancelling the operator’s licence of Bluegrass Holdings Ltd. The cancellation was to take effect on
18 August 2014. Bluegrass Holdings Ltd sought judicial review of the Commission’s decision declining the appeal, and also sought urgent relief from the cancellation decision. That relief was granted in a judgment of
Faire J in the High Court at Auckland dated 19 August 2014, which preserved the operator’s licence of Bluegrass Holdings Ltd until
22 September 2014.
· On 3 September 2014, Bluegrass Holdings Ltd decided not to pursue the judicial review hearing and ceased operating at the venue. The judicial review proceeding was formally discontinued on 11 September 2014.
· On 16 October 2014, the respondent refused the applicant’s application for a venue licence. The applicant lodged an appeal with the Gambling Commission against that refusal. The respondent opposes the appeal.
A quartet of decisions
[10] In support of its application the applicant placed significant reliance upon two decisions of this Court, First Sovereign Trust v the Secretary for Internal Affairs1 and Grassroots Trust v The Secretary for Internal Affairs.2
[11] In First Sovereign Trust Ronald Young J granted an order to the effect that a class 4 venue licence should issue to the applicant on or before 29 March 2005, being a date shortly prior to the expiry of the six month period in s 92(1)(b).
[12] The Judge rejected the defendant’s submission that the granting of interim relief would improve the plaintiff’s position, noting that the making of the order did not guarantee a licence to the applicant but did ensure that, were a licence to be granted, then the applicant could take the benefit of the conditions permitted by s 92. The Judge noted the plaintiff’s acceptance that s 8 of the Judicature Amendment Act 1972 did not fit well with the facts of the case and referred to the traditional reluctance of Courts to make orders requiring the issue of licences in judicial review
proceedings. However in granting the order he stated:
1 First Sovereign Trust v the Secretary for Internal Affairs HC Wellington CIV-2005-485-512, 22
March 2005.
2 Grassroots Trust v The Secretary for Internal Affairs HC Wellington CIV-2011-485-13,
19 January 2011.
[30] I accept the defendant’s general proposition that such an order is typically only made if after considering the merits of the application the granting of such a licence would be inevitable. Ordinarily, Courts leave, for sensible policy reasons, the granting of such licenses to the bodies that Parliament anticipated would consider them.
[31] In this case, however, I consider the position to be sufficiently unusual to justify an unorthodox approach. The maxim that every right should have a remedy is relevant here. If no order can be made, the plaintiff’s entitlement to pursue the opportunity will be lost primarily by the delay of the defendant. If an order is made requiring the defendant to issue a venue licence with respect to the premises for say one day, then I consider that justice would be served. The one day licence pursuant to s 92 of the Act would mean that a six month period would start from the day after the one day licence. This will protect the plaintiffs’ opportunity. The licence will not be able to be exercised in fact by the plaintiff for the one day. The premises are not ready to open and there are no gaming machines in the premises. In this sense, no harm will be done.
[13] Although in Grassroots Trust Wild J declined to make a similar order, the reason his refusal of the order was that the applicant failed to attain the threshold of demonstrating that it had a seriously arguable case. However the Judge indicated that, had Grassroots surmounted that threshold, relief would have been granted albeit subject to a condition. The Judge’s reasons for that view included the following:
[35] Thirdly, Ms Muller submitted that granting interim relief would run contrary to the scheme of the Gambling Act and would improve rather than preserve Grassroots’ position. She submitted that there is no provision in the Act allowing the period of up to six months referred to in ss 90(2) and
92(1)(b) to be “stopped” once it has started to run. Directing the respondent
to grant Grassroots a Class 4 venue licence for the Bus Stop Tavern for one day would, contended Ms Muller, controvert the Act. Ms Muller argued that
the interim relief sought is not necessary to preserve Grassroots’ position. It
is sought to improve its position by, in effect, stopping and re-starting the six month period. The Act does not provide for the period to be stopped for any reason. It does not stop to enable an application for a venue licence filed during the period to be processed. It does not stop where an application has been refused, to enable rights of appeal to be pursued.
[36] I accept all of that. But I do not accept that granting interim relief would controvert the scheme of the Gambling Act or materially improve Grassroots’ position. If (and I have found this not to be the case) the respondent, for irrelevant reasons, had refused an application made by Grassroots comfortably within the six month period, then it cannot be contrary to the Act effectively to “stop” the six month period running to enable the decision making process to be properly completed. In order to have the benefit of the “grandfathered” status permitted by s 92, I accept that Grassroots needed to secure the grant of a venue licence within the six month period. But if it fails to do so only because of faulty decision making by the respondent, then it must be proper for the Court to ensure that the benefit of the “grandfathered” status inures for Grassroots.
…
[38] What I do accept is Ms Muller’s submission that any one day licence I directed the respondent to grant to Grassroots should be subject to a condition. Had I directed the respondent to grant such a licence I would have directed that it be subject to the condition that:
(a) Grassroots and Windsock pursue their respective judicial review application and appeal expeditiously. I would have reserved to the respondent leave to apply if this did not occur.
(b) The licence was granted consequent upon the review or appeal.
The point of (b) is to counter the advantage that would otherwise result from the grant of a one day licence ie the six month period referred to in ss 90(2) and 92(1)(b) stopping and starting to run again.
[14] The respondent drew attention to a further judgment of Ronald Young J in Air Rescue Services Ltd v The Secretary for Internal Affairs in which a one day class 4 venue licence was declined.3 While recognising that the situation was broadly similar to that in First Sovereign Trust, the Judge considered that the circumstances of the two cases were significantly different, nothing that the plaintiff had a weak rather than a strong arguable case and that the plaintiff was responsible for most of the delay. His Honour made the further observation:
[62] Secondly, ordinarily, it is inappropriate for a Court to direct an administrative authority given the power by Parliament to grant such a licence. Also it is generally inappropriate for a Court to effectively bypass legislative provisions by the kind of order sought by the plaintiff here. In making these comments I acknowledge however I have directed the issue of such a licence in other cases.
[15] As the judgment recorded, it was given on the assumption that the six month period referred to in s 92(1)(b) continued to run even where there is an application for a new licence, a point on which the Judge had not heard argument. However that issue was addressed in a further judgment, (Air Rescue Services (No 2))4 which it
was stated was to be read with the first judgment on the matter.
3 Air Rescue Services Ltd v The Secretary for Internal Affairs HC Wellington CIV-2010-485-1919,
8 October 2010.
4 Air Rescue Services Ltd v The Secretary for Internal Affairs HC Wellington CIV-2010-485-1919,
3 May 2011.
[16] In Air Rescue Services (No 2) the applicant contended that Parliament had made a drafting mistake when enacting s 92(1)(b) and that the word “held” should be interpreted as including not only the time during which a licence was in existence but also the period from the date of the application (or appeal) until resolution, even though at that time a licence was not literally “held”. The applicant also drew
attention to a range of provisions5 which protected licensees from cancellation while
awaiting consideration of an application or an appeal. The purpose of those provisions seen together was said to illustrate that Parliament’s failure to provide similar protection in s 92(1) was an oversight.
[17] The reasons of Ronald Young J for rejecting those submissions included the following:
[51] As to Parliamentary purpose and context what must be kept in mind is that what is being protected here is the grandfathering of an existing entitlement. This is not a case of complete loss of entitlement. There is, therefore, a logical reason for a different approach to s 92 from the other statutory provisions relied upon by the plaintiff as analogous. None of the analogous provisions relate to any form of grandfathering of existing rights. They are concerned with the continuation of existing licenses in some form or another. They are each designed to ensure that an existing licence continues even beyond its expiry date as long as an application for extension or amendment etc has been made within the time limit provided.
…
[56] It is clear from the Act that Parliament was well aware that it had the power to suspend time while applications and appeals were being considered as identified in ss 56, 62, 72 and 78. These sections expressly contain such a power.
[57] There is no reason to think that the absence of any such provision in s 92 is anything other than deliberate. After all Parliament was clearly aware of its power to do so.
…
[67] The plaintiff has not convinced me, therefore, that Parliament’s intention in s 92(1)(b) was to protect those who held and those who had applied for licences. On balance I consider that there is nothing in the history, purpose or context of the Act which convinces me to stretch the definition of “held” or add the words identified (see [12]) to s 92(1)(b). While this section is a somewhat unusual provision that conclusion is well short of what is required before it would be proper for me to stretch the definition of words or add to what Parliament has itself written.
5 Sections 56, 62, 72 and 78.
Discussion
[18] I find compelling the reasoning of Ronald Young J in Air Rescue Services (No 2). I agree that the only proper interpretation of the legislation is that Parliament did not provide to unsuccessful applicants for licences the same protection that was afforded to licence holders whose licences were cancelled or suspended.
[19] Ronald Young J’s recitation of Air Rescue’s argument included the following:
[26] … [The plaintiff] says that a purposive interpretation gives a practical, sensible and workable result. This points toward ensuring that as long as an application for a new licence (or an appeal from a refusal) is lodged within the six month period identified in s 92(1)(b) then time effectively stands still until the application has been resolved. This is the only way to ensure that rights are not lost or arbitrarily infringed and the legislation is able to work as Parliament intended.
[20] Of course, contrary to the “only way” submission, Air Rescue now seeks to pursue an alternative route to the same outcome by inviting the Court to direct that a licence be issued, albeit for only a single day. The consequence of such an order would be that a licence would again be “held” before the expiry of the s 92(1)(b) six month period. Hence the statutory clock would be stopped and a fresh six month period would begin to run on the day following the expiry of the one day licence.
[21] In analysing the status quo, it was Mr Elliott’s submission that the order sought was necessary in order to preserve the right attaching to the venue to operate
18 gaming machines and that absent an order the right would be lost. In response Ms Andrew noted that the Gambling Commission has a discretionary power to backdate a licence in order to put the appellant in the position it would otherwise have been if it succeeded on its appeal and hence the order sought was not necessary. The applicant’s rejoinder was that the right would still be lost and that a discretionary entitlement was not a substitute.
[22] I have difficulty in accepting the applicant’s analysis of the status quo as equating to an entitlement to operate 18 gaming machines. That “entitlement” is subject to a statutory framework which provides for the specified non-extendable time period in s 92(1)(b) and the discretion reposed in the Gambling Commission to permit the continued operation of 18 machines. In my view the status quo is
reflected in the structure of the statutory regime, not in a supposed “right” to operate a certain number of machines.
[23] In any event, there are two matters which persuade me that granting the interim order sought is not appropriate. First, I do not view the proposed order as being truly in the nature of interim relief. Quite apart from the fact that there is no intention to proceed to a substantive hearing seeking final relief (because the appeal right is available and is being pursued), the relief in the form of the grant of a licence is final in nature. If granted, then the statutory time period is in effect reset.
[24] I apprehend that it was to address such a concern that Wild J in Grassroots
Trust indicated that, had relief been granted, it would have been conditional:
[38] What I do accept is Ms Muller’s submission that any one day licence I directed the respondent to grant to Grassroots should be subject to a condition. Had I directed the respondent to grant such a licence I would have directed that it be subject to the condition that:
(a) Grassroots and Windsock pursue their respective judicial review application and appeal expeditiously. I would have reserved to the respondent leave to apply if this did not occur.
(b) The licence was granted consequent upon the review or appeal.
The point of (b) is to counter the advantage that would otherwise result from the grant of a one day licence ie the six month period referred to in ss 90(2) and 92(1)(b) stopping and starting to run again.
Counsel were unable to assist me as to how the imposition of such a condition would avoid the outcome whereby the six month period re-started.
[25] Secondly, I share the concern of Ronald Young J6 that it is generally inappropriate for a Court to effectively bypass legislative provisions by the kind of order which the applicant seeks. The applicant had no intention of utilising the licence which would be of only one day’s duration. The sole object of such a licence is to prevent the effluxion of a specified statutory time limit. I do not consider that it is the role of the Court to manipulate such a time limit in the guise of interim orders
in review proceedings.
6 At [14] above.
Costs
[26] The parties were agreed that costs should follow the event. Accordingly the respondent is entitled to costs on a 2B basis and disbursements.
Solicitors:
Crown Law, Wellington
Brown J
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