Sky City Auckland Ltd v Wu

IN THE COURT OF APPEAL OF NEW ZEALAND

CA47/02

BETWEEN	SKY CITY AUCKLAND LIMITED
First Appellant

AND	SKY CITY CASINO MANAGEMENT LIMITED
Second Appellant

AND	ZHANG PING WU
Respondent

Hearing:	29 May 2002
Coram:	Blanchard J McGrath J Anderson J
Appearances:	P J Davison QC, S Stokes and P T Rishworth for Appellants P J K Spring, M B Taggart and S O McAnally for Respondent
Judgment:	7 August 2002

JUDGMENTS OF THE COURT

Judgments

Para No

Blanchard and Anderson JJ [1] – [40]
McGrath J [41] – [54]

BLANCHARD AND ANDERSON JJ (DELIVERED BY BLANCHARD J)

This is an appeal from a judgment of Chambers J in the High Court at Auckland on 13 February 2002 granting the respondent, Mr Wu, an interlocutory injunction restraining the appellant operators of the Sky City Casino (Sky City) from preventing him under a banning notice dated 18 February 2001 for a period of two years from entering the casino or using its facilities.   The appeal concerns the interpretation of s67 of the Casino Control Act 1990 (the Act) against the background of the common law which underlies that section. The section reads:
67       Entry to and exclusion of entry from casino
(1)       The fact that a casino is licensed under this Act shall not entitle any person to enter or to remain on the casino premises as against the holder of the casino premises licence or the casino operator's licence; and, subject to any right conferred by or under any other Act, every person shall leave the casino premises when required to do so by or on behalf of the holder of the licence.
(2)       The provisions of subsection (1) of this section are in addition to, and not in derogation from, the Trespass Act 1982.
The notice given Mr Wu was in the following form:
SKYCITY Trespass Notice
To: Mr Zhangping Wu
17 Albert Street, 11^th Floor, Auckland City
PURSUANT to section 67 of the Casino Control Act 1990 and under the general law, any person must leave SKY CITY AUCKLAND LIMITED when requested to do so.
TAKE NOTICE THAT YOU ARE FORBIDDEN FROM ENTERING SKY CITY LTD PREMISES WHICH INCLUDES ALL GAMING AREAS, SKY TOWER, SKY THEATRE, SKY CITY HOTEL, CARPARKS AND RESTAURANTS FOR A PERIOD OF TWO YEARS FROM THE DATE OF THIS NOTICE.
If you re-enter Sky City Auckland Limited within two years from the date of this notice you will commit an offence under the Trespass Act 1980 and civil wrong of trespass.
A copy of this notice was served on Zhangping Wu at 1510 hrs on Sunday the 18^th of February 2001
On behalf of: SKY CITY AUCKLAND LIMITED
The issue is whether there is any obligation on Sky City to show that it acted reasonably in banning Mr Wu for the period which it has stipulated. Mr Wu contends that Sky City has banned him merely because he is a successful gambler and had raised with it an issue about discrepancies in pay-outs from slot machines in the casino. Sky City, while denying that this was the reason and saying that Mr Wu was ejected after threatening one of its staff members, says that under the general law, as confirmed by s67, it is entitled, as a landowner, to exclude people from its property, the casino, without giving any reason. We should interpolate at this early stage that no argument is made on Mr Wu’s behalf that Sky City has acted towards him in breach of any of the anti-discrimination provisions of the Human Rights Act 1993. He does not say, for example, that he has been banned because he is Chinese. The parties are in agreement that the Casino Control Act must be read subject to those provisions.
In the High Court Chambers J considered three causes of action. Two of those, in public law, seeking either judicial review under the Judicature Amendment Act 1972 or an order for certiorari under r626 of the High Court Rules, were respectively rejected or not the subject of a ruling by the Judge. They have not been raised before us. The Judge made his decision on the basis of a cause of action based in private law. The argument was made that Sky City owes casino patrons “a legal duty to serve and treat members of the public equally, without discrimination and in a fair and reasonable manner”. So, it was said, the casino may not ban members of the general public without good cause. That alleged duty was pleaded as arising from:
[a]The establishment and regulation of the casino industry in New Zealand by statute in the public interest;
[b]The rights and privileges conferred on Sky City by virtue of its being the holder of a casino premises licence under s31 of the Act;
[c]The rights and privileges conferred on Sky City by virtue of its being the holder of a casino operator’s licence under s37 of the Act;
[d]The status of the casino as a lucrative State-licensed monopoly affected with a public interest;
[e]Sky City holding itself out to the public as being willing to serve all, thereby creating an expectation that access/entry will not be denied without warning, proper grounds and procedural fairness; and
[f]The status of casinos as a common calling in New Zealand in 2001.
Chambers J concluded that Sky City did owe a “special duty to the public” as alleged. He said that when property owners open their premises to the general public in the pursuit of their own property interests, they must not exclude people unreasonably. They have a duty not to act in an arbitrary or discriminatory manner towards people who come on to their premises. Probably, the Judge said, this is but a development of the old law of common callings. The general proposition of law was subject to a qualification contained in s67(1). That subsection empowered the casino premises licence holder and the casino operator’s licence holder to require people to leave the casino premises and everyone must comply with such a request unless he or she can point to a statutory right to remain, which Mr Wu could not do. That did not mean, however, the Judge said, that licence holders could capriciously request people to leave. In exercising the s67 powers, licence holders were subject to public law constraints, which might also affect private law obligations and rights. That was not a matter which the Judge said he needed to decide, as Mr Wu’s application for an interlocutory injunction was based not on Sky City’s removal of him but rather on the purported ban against re-entry. Section 67(1) did not affect Sky City’s powers to ban, which stemmed from its rights as occupier of the premises. But those rights were not absolute. They were subject to the restriction to which he had referred.
The Judge found that Sky City was under a duty not to ban members of the public without good cause. That duty arose from its holding itself out to the public as being willing to serve all. The duty did not arise by virtue of any licence under the Act or from the status of the casino as a state-licensed monopoly. It was not relevant that Sky City happened to be the only casino in Auckland. “There cannot be one rule for Sky City because it is the sole casino in its city and another rule for towns like Queenstown where there is more than one casino”. It was the fifth matter pleaded (see para [4] (e) above) which was the true basis of the duty, although the Judge was not necessarily to be taken as subscribing to the pleaded “expectation”. The duty was not to exclude people unreasonably.
Chambers J thought there was no need to determine whether casinos are a common calling in New Zealand in 2001 because the law of common callings has, at least in this respect, now been subsumed within a wider proposition. The Judge concluded:
Any land occupier under the general law can give notice to others requiring them to stay off his or her land. Those who defy such notices commit the tort of trespass. That power to exclude is subject to qualification, however, in the case of property owners who open their premises to the general public in pursuit of their own property interests. Such property owners cannot exclude or ban people unreasonably.
Chambers J took the view that there was a serious question to be tried as to whether Mr Wu had been banned without good cause. He referred to the evidence about an incident said to have occurred between Mr Wu and one of the casino employees, finding that there was “a clear discrepancy in the evidence as to what happened”. Mr Wu had established that there was a serious question to be tried. If his version of events was correct, then almost certainly there was not a reasonable basis for the ban and, even if the ban were justified, it was certainly arguable that a two year period was unreasonable. The balance of convenience supported the grant of an interlocutory injunction. Damages were unlikely to be adequate compensation to Mr Wu for being deprived of the chance to use the casino and it was difficult to see what harm Sky City would suffer. It did not assert that Mr Wu was a cheat or was making too much money from his activities in the casino. The overall justice of the case was said to be in line with the Judge’s assessment of the balance of convenience and, in particular, his assessment of the balance of risk of doing an injustice.
On this appeal both sides agree that we should merely determine whether Sky City was under a duty to act reasonably in banning Mr Wu from the casino. If it was, as Chambers J held, the appellants accept that there is a serious question to be tried and that, for the reasons given by him, the interlocutory injunction restraining them from enforcing the ban should remain in place pending trial. However, if there is no such obligation to act reasonably, Mr Wu’s cause of action must fail and the interlocutory injunction against Sky City should be discharged.

Submissions for appellants

Mr Davison QC took as a starting point the unfettered right of an owner or occupier of land to exclude others without giving justification or reasons. The right arises as an incident of property ownership or possession and is enforceable by means of the tort of trespass to property. It was submitted that Chambers J had undertaken an inappropriate reformulation of this fundamental right. As expressed, it would embrace all kinds of private property, for example, a corner dairy, retail premises, sporting venues and restaurants. All would have to substantiate any exclusion of a member of the public with well-founded reasons. Any such reformulation, it was submitted, should and could occur only through legislation. It was wrongly undertaken by the Judge also because Parliament has already entered the field by placing some restrictions upon the conduct of occupiers by means of the Human Rights Act. In any event, s67(1) precluded application of any reformulated general rule to licensed casinos.
Counsel referred to the difficulties created by departing from the brightline rule that reasons were not required by the landowner, and to the danger that some people would be sure to litigate their exclusion and breaches of the peace might occur when disputes arose over the propriety of an owner’s conduct. There would be uncertainty also over procedural obligations accompanying any exercise of a qualified right.
Questions of the reasonableness or fairness of an owner’s actions towards persons on his or her property were said to be foreign to private law and, it was submitted, should not be imported from public law. Subject to an absence of any discrimination in breach of the Human Rights Act, the casino licence holder, as a property owner or occupier, must have the right to exclude someone without having to give any reason or justifying their action. They are entitled to exclude someone, for example, because they may be considered to be winning too much. A gambler has the protection afforded by the Human Rights Act and by ss83(d) and 84 of the Act under which complaints can be made to an inspector by casino customers relating to the conduct of gaming in any casino and the inspector is obliged to carry out an investigation and may, if there is an irregularity, report the matter to the Casino Control Authority.
The Judge’s conclusion would also have been unsupportable, Mr Davison said, if he had relied upon the licensing of casinos and the geographical monopoly said to be enjoyed by the casino in Auckland, at least until the Hamilton casino opens. Counsel referred to the difficulty of determining when a monopoly exists (the problem of defining the monopoly). In fact, s67(1) itself is directed at the existence of the licence and says that it is not to entitle anyone to enter or remain on casino premises. So the licence is not to restrict the common law power to exclude. Significantly, it was said, the word “reasonably” does not appear in the section.
Counsel for the appellants also made the argument that the suggested development of the law of common callings is unnecessary to prevent discrimination, which is already prohibited by the Human Rights Act. The supposed development, found in certain United States cases, was said by Mr Davison to be uncertain and problematical. The Human Rights Act was said to preclude the extension or application of the common law, just as the Commerce Act did in Vector Ltd v Transpower NZ Ltd [1999] 3 NZLR 646. Parliament has struck the balance which it thinks appropriate and has provided by means of the Human Rights Act appropriate mechanisms for resolution of disputes between casino owners and patrons over their exclusion from a casino. It was submitted that s67 amounts to a statutory contra-indication to the supposed development of the common law.
The plain meaning of the section was submitted to be that it augments the powers otherwise available under the general law of property. Persons have no right to enter a casino on the ground that it is licensed, the correlative being that casino operators have “a liberty, but not a duty,” to let people enter. The statutory requirement that every person shall leave when required to do so is not, it was submitted, the source of the power to ask them to leave. That is found in property law. Mr Davison submitted:
It is difficult to imagine that s67(1) could have been any clearer in this regard. Its whole point seems to have been to affirm the common law and to pre-empt any argument that might have been made along the lines that simply because a casino is licensed it is thereby under a duty to exclude only for good reason.

Submissions for respondent

Mr Taggart submitted that at common law the right of a property owner or occupier to require persons to leave the property or to refuse them entry has been qualified where the owner or occupier is using the property to conduct a business affected by the public interest. A casino operator, by virtue of a licence from the State, is in the position of having a “virtual monopoly” (also put as a “relative monopoly”) and therefore has such a business. Because of the status of the business the casino operator cannot exclude a member of the public from access to it without good reason. Section 67, it was submitted, merely confirms this position, but it does require the patron to leave first and argue afterwards about the reasonableness of the casino operator’s requirement.
Counsel said that this Court in Vector had traced the common law doctrine of prime necessity back to passages in Sir Matthew Hale’s Treatise De Portibus Maris, written about 1670 but published in 1787 (1 Harg. L. Tr. 78) and had accepted that, where a relevant monopoly exists, property becomes affected with a public interest and subjected to the asserted common law obligations. The Court had recognised that the principle owed something to the rule that those who exercised a common calling had a duty to serve all and at a reasonable price. The modern form of the doctrine has developed by analogy and resembles the American law of public utilities. The concern is with the abuse of monopoly power. It was submitted that the point has been reached in New Zealand where the various doctrines have merged into one which has several aspects: businesses affected with a public interest are bound to supply goods and services to the public equally, without discrimination and unreasonable exclusion, and at a reasonable price. There are several factors which, it was submitted, either singly or in combination, trigger these obligations and temper the existence of property rights. They include the presence of monopoly or near monopoly, the source of the authorisation, presence of State licensing, the nature of the service and the importance of the service to the individual and/or the community, the holding out to the public and the furnishing of that service to a large number of people.
Mr Taggart argued that there is an analogy between the present case and Allnutt v Inglis (1810) 12 East 527, where the proprietor of a bonded warehouse (in which imported goods could be deposited without payment of customs duty until their release from the warehouse) was held to be under a common law duty, derived from Hale’s statement of principle, to make its facilities available to the plaintiff upon tender of reasonable compensation. (Because of s64 of the Act, under which casino operators may not charge for the “right of entry”, no question of reasonableness of charges arises in the present case.) The remedy where goods were excluded without good reason or the price was too high was an action in tort (action on the case). (For a modern example of a tort action for exclusion involving racial discrimination by an inn-keeper, Mr Taggart referred to Constantinev Imperial London Hotels Ltd [1944] KB 693).
It was submitted that it is appropriate now to extend this common law doctrine to the situation of the Auckland casino. The operator’s licence is granted without a fixed term and s91 of the Act provides that only the police or an inspector can apply to have it varied, suspended or cancelled. The factor of a monopoly for an unlimited term was said to distinguish this Court’s decision in Pollock v Saunders (1897) 15 NZLR 581 (bookmaker held lawfully excluded from racecourse) where the licence was only from race-meeting to race-meeting. There was also said to be reasonable cause for the exclusion in that case. The law’s hostility to gambling, which counsel submitted was evident in that case, no longer applies. Parliament has legislated for the establishment of casinos, recognising that they are capable of conferring economic benefits. Accordingly, no patron should without cause be prevented from engaging in their activities. Mr Taggart referred the Court to, inter alia, the decision of the Supreme Court of New Jersey in Uston v Resorts International Hotel Inc 445 A 2d 370 (1982) in which an extension of the common law to casinos had been approved under an expansive definition of “common calling” or “business affected with a public interest”.
It was further submitted that the enactment of the Human Rights Act is not a reason to deny application of the developing common law doctrine to casinos. That Act was said to deal with systemic discrimination, not with discrimination against an individual on grounds falling outside that Act, such as the fact that the person concerned had been a winner in the casino, or for an arbitrary reason, such as hair colour or perceived ugliness or because of mere personal dislike. Because it has a licence giving it a virtual monopoly, it was said, Sky City is not entitled to discriminate in this way. This burden on its general common law property rights must be accepted along with the benefit of the virtual monopoly position it has gained by means of its licence.
Mr Taggart said that the common law and the statute must have been intended to work together. The meaning of s67 was said to be consistent with the common law, confirming it but also ensuring that, notwithstanding the licence, the patron cannot raise the question of reasonableness until after immediately leaving upon request. The section was said also to be intended to make it clear that, regardless of the licensed status of the casino, the operator can exclude the public during hours when the casino is closed; and it also made it possible to close all or part of a casino except to certain classes of person, for example, for the holding of private functions. This view of the operation of s67 was said by counsel to be confirmed by the reference in s64 to a right to enter and by the power in s68 to make regulations concerning admission. It was also submitted that the exclusion of professional gamblers would operate as an unreasonable restraint of their trade.

Discussion

The idea that a business invested with “the monopoly of a public privilege” must, in the absence of good reason in a particular case or situation, such as a lack of capacity to provide goods or services, make its facilities available to all, and at a reasonable price, is soundly based both in New Zealand law and in economic good sense. The phrase “affected with the publick interest” comes from Hale himself, as this Court noted in Vector Ltd v Transpower New Zealand Ltd, at para [41]. We referred to the judgment of Lord Ellenborough CJ in Allnutt v Inglis. In that case the London Dock Company had been certificated under an Act of Parliament whereby it had become lawful for wine importers to store their wines in the company’s warehouses and defer paying duties on them until the wines were taken out of store. The plaintiffs had been refused the use of this bond-store facility because they would not agree to pay the company’s notified charges. There was no other place in the Port of London where such a facility was available, although the Court commented that if the exclusive privilege had been extended to a few others it would not appear to have varied the case. It was held that there was such a monopoly and public interest attaching to the company’s property that it was bound by law to receive the goods into its warehouses for a reasonable hire and reward. Lord Ellenborough, in the leading judgment, recognised a general principle “that every man may fix what price he pleases upon his own property or the use of it”. But “if, for a particular purpose, the public have a right to resort to his premises and make use of them, and he have a monopoly in them for that purpose, if he will take the benefit of that monopoly, he must as an equivalent perform the duty attached to it on reasonable terms”. The Chief Justice said that the legislation enabling the deposit of the wines without payment of duties in the first instance had been passed “not merely for the benefit of the company but for the good of trade”. The company’s warehouses had been “invested with the monopoly of a public privilege, and therefore they must by law confine themselves to take reasonable rates for the use of them for that purpose”. At p540 there is the following passage:
If the Crown should hereafter think it advisable to extend the privilege more generally to other persons and places, so far as that the public will not be restrained from exercising a choice of warehouses for the purpose, the company may be enfranchised from the restriction which attaches upon a monopoly : but at present while the public are so restricted to warehouse their goods with them for the purpose of bonding, they must submit to that restriction : and it is enough that there exists in the place and for the commodity in question a virtual monopoly of the warehousing for this purpose, on which the principle of law attaches, as laid down by Lord Hale in the passage referred to, which includes the good sense as well as the law of the subject.
The judgments of Le Blanc J and Bayley J were to similar effect, the latter commenting that the company could not partially renounce the application of their warehouses to the use authorised by Parliament, “and I think it would be deluding the public if the company were able to renounce at a moment’s warning the warehousing of the goods for this purpose after they had agreed to accept the licence and monopoly”. (p544)
The same principle, deriving from Hale, was accepted by the Supreme Court of the United States to be part of the common law in that country in Munn v Illinois 94 US 1977 (1876). Waite CJ, delivering the opinion of the Court, said:
Property does become clothed with a public interest when used in a manner to make it of public consequence, and affect the community at large. When, therefore, one devotes his property to a use in which the public has an interest, he, in effect, grants to the public an interest in that use, and must submit to be controlled by the public for the common good, to the extent of the interest he has thus created. He may withdraw his grant by discontinuing the use; but, so long as he maintains the use he must submit to the control. (p84)

A subsequent reference to Hale makes it clear that the Court was contemplating a situation in which the person concerned had an effective monopoly.

Vector confirms the reception of the principle into New Zealand law and refers to a considerable body of authority in this country. The label given to it in that case – the doctrine of prime necessity – is a term appropriate to cases which concern the supply of electricity or water by a utility company but we think that Mr Taggart is correct in his submission that that doctrine is a strand of the broader principle which, as Vector recognised, is adaptable to meet new legal and social situations.
This Court viewed the doctrine of prime necessity as a “backstop common law remedy”, to be applied in the absence of other remedies and where there are no statutory contra-indications to its use, such as were found in that case in the Commerce Act, reinforced by the State Owned Enterprises Act. As Thomas J said in his concurring judgment in Vector at para [77], without such a remedy the law would be deficient. Thomas J spoke of the law’s objective of curbing the exploitation of monopoly power in the supply of essential services (para [80]).
In the United States it is not yet settled whether, and to what extent, licensed gambling facilities are properly to be regarded as businesses affected by the public interest. The Supreme Court of New Jersey has favoured the view that they are. In Uston v Resorts International Hotel Inc 445 A 2d 370 (1982) the appellant had excluded Mr Uston from blackjack tables in its casino because he was a practitioner of a complex strategy for playing blackjack known as card counting, which increased his chances of winning money. The Court held that New Jersey’s Casino Control Act gave its Casino Control Commission exclusive authority to set the rules of licensed casino games, which included methods of playing those games. The Court held that the Act therefore precluded the appellant casino from excluding Mr Uston for card counting. Any common law right the casino may have had to exclude him for this reason was abrogated by the Act. But, in an obiter portion of its judgment, the Court made some observations about the position, as it saw it, at common law. It recognised that the majority American rule had for many years disregarded the right of reasonable access and had allowed proprietors of amusement places an absolute right arbitrarily to eject or exclude any person consistently with State and Federal civil rights laws. The New Jersey Court took a different view. It said that property owners have no legitimate interest in unreasonably excluding particular members of the public when they open their premises for public use. Whether a decision to exclude was reasonable must be determined from the facts of each case.
Uston can be contrasted with the decision of the United States Court of Appeals for the Seventh Circuit in Brooks v Chicago Downs Association Inc 791 F.2d 512 (1986), which concerned whether the operator of a horse racetrack had the absolute right to exclude a patron from the track premises for any reason, or no reason, except race, colour, creed, national origin or sex. The Court allowed the exclusion. The argument for the racetrack owner had been that because it was a privately owned place of amusement it could exclude someone “simply for wearing a green hat or a paisley tie”; that it need give no reason for excluding the patron “because it is not a State-granted monopoly, but a State-regulated licensee operating on private property”. The Seventh Circuit followed the decision of the New York Court of Appeals in Madden v Queens County Jockey Club 72 NE 2d 697 (1947) in which the plaintiff had been barred from the Aqueduct Race Track by the club under the mistaken belief that he was a bookmaker with the same surname operating for a well-known mobster. The New York Court had concluded that the club had the power to admit as spectators only those whom it might select and could exclude others as long as the exclusion was not founded on race, creed, colour or national origin. The Court had rejected Mr Madden’s argument that a licence to conduct horse racing was equivalent to a franchise or a monopoly to perform a public service.
The Seventh Circuit found that the defendant in the case before it, the racetrack owner, did not enjoy a State granted franchise or monopoly. It had “only a licence for 75 days of racing in any one year.” That licence had been imposed only to regulate and raise revenue, “as opposed to a franchise which grants a special privilege that does not belong to an individual as a matter of common right”. The Court added:
Any one racetrack may or may not have a “quasi-monopoly” (a term that is subject to many interpretations) over opportunities available to jockeys, owners, or drivers, but they do not have a true monopoly over opportunities for the plaintiffs to bet on horses. (p516)
Accordingly, the Seventh Circuit found, the proprietor of the racetrack did not have to prove or explain that the reason for exclusion was a just reason:
He doesn’t want to be liable to Coley Madden solely because he mistakenly believed he was a mobster. The proprietor wants to be able to keep someone off his private property even if they only look like a mobster. As long as the proprietor is not excluding the mobster look-a-like because of his national origin (or because of race, color, creed, or sex), then the common law, and the law of Illinois, allows him to do just that. (p517)
The Seventh Circuit chose not to follow what it called the arguable – but not clear – abandonment of the common law rule in New Jersey in Uston. It said that it was clear that New Jersey had not per se abandoned the common law rule “but has adapted it, in a limited fashion, to the particular needs of its casino industry. The Seventh Circuit seems to have been considerably influenced by the fact that in the situation before it there was no monopoly.
The decision in Brooks v Chicago Downs is, we think, broadly consistent with this Court’s decision in Pollock v Saunders (1897) 15 NZLR 581 which upheld the right of a racing club licensed to use a totalisator at a race meeting, to exclude a professional bookmaker from the course. The Court referred to Allnutt v Inglis, saying that in that case the privilege was conferred and the monopoly created by a statute in favour of particular individuals. If it had not been for the doctrine stated in that case, the Court said, any abuse of the privileges could only have been remedied by legislation. But there was no pretence of that in Pollock because the privilege was from race-meeting to race-meeting and was entirely in the discretion of the Colonial Secretary, who was the licensing authority under the relevant legislation, the Gaming and Lotteries Act 1881. The point of significance, it seems to us, is that the Court was indicating the possibility of a different view if the gaming facility had actually been a licensed monopoly.
Counsel for the appellants placed reliance on the decision of the English Court of Appeal in CIN Properties Ltd v Rawlins [1995] 2 EGLR 130, an extempore judgment which briefly referred to Uston and regarded it as based upon a previous decision of the Supreme Court of New Jersey in State v Schmid 423 A 2d 615 (1980), which the English Court believed to have turned upon the constitutional freedoms of the First Amendment. Therefore, the general proposition in Uston was considered to have no application in English law. With respect, we regard this as an inaccurate reading of what the New Jersey Supreme Court was saying when it referred to Schmid. That case certainly had constitutional overtones but the New Jersey Court saw the decision in Schmid as being analogous to the position at common law. It is to be noted that, more recently, dicta from a differently constituted English Court of Appeal in Porter v Commissioner of Police (unreported, 20 October 1999) has acknowledged the possibility of further incremental development of the common law.
Although we do not find it necessary to express a concluded view, we have found persuasive Mr Taggart’s argument, based in part on the foregoing authorities, that the common law of New Zealand will now recognise a casino or other licensed gambling facility as a business affected by the public interest in circumstances where the operator enjoys a monopoly; and that in such a case, subject to any statutory provision to the contrary, the operator’s right to exclude members of the public may be qualified by an obligation to do so only for an articulated good reason.
We do not, however, express a firm conclusion on this point because, even if that is assumed to be the law and the Sky City Casino is further assumed to be operating in monopoly conditions, in our view s67 expresses a legislative contra-indication, namely that the fact that the casino is licensed does not make it necessary for the licence holder to have a good reason for excluding someone from the premises.
It may be helpful if we set out the section again:
67     Entry to and exclusion of entry from casino
(1)       The fact that a casino is licensed under this Act shall not entitle any person to enter or to remain on the casino premises as against the holder of the casino premises licence or the casino operator's licence; and, subject to any right conferred by or under any other Act, every person shall leave the casino premises when required to do so by or on behalf of the holder of the licence.
(2)       The provisions of subsection (1) of this section are in addition to, and not in derogation from, the Trespass Act 1982.
It can be seen that it is directed to the effect of the licensing of the casino under the Act. That fact is not to entitle any person to enter or remain on the premises and, subject to any right conferred by or under any other Act – such as the Human Rights Act – every person is to leave the casino premises when required to do so by or on behalf of a holder of the licence. In addition, the Trespass Act 1982 can be invoked. It seems to us that the very purpose of the section is to negate the doctrine upon which the respondent is relying – to negate any suggestion that because the casino is licensed, and in its particular situation therefore may operate as a monopoly created by the licence, patrons must not be excluded without good reason. The argument for the respondent is that the section merely states the position at common law modified to require an excluded patron to leave first and argue afterwards, but surely, if that had been intended, it would have been very directly stated that persons must not be excluded without good reason although they must leave if asked to do so and contest the validity of their exclusion thereafter. It is, we think, of significance, as the appellants submitted, that the word “reasonably” does not appear in the section.
It was further suggested for the respondent that the section has the limited objective of ensuring that the public can be excluded from the casino during hours when it is not operating. But, as there is no obligation on the operator to have the business open at particular times, we consider that Parliament is unlikely to have thought it necessary to legislate for the licence holder’s obvious right to choose not to operate during all hours and on all days authorised pursuant to s61. Again, s67 would be a most obscure way of expressing such a provision. For the same reason we reject also the further suggestion that the intention of the section was to enable the premises to be closed in whole or in part to enable them to be used for private functions.
We have therefore concluded that the purpose of s67 is to make it clear that the holders of licences pertaining to casinos under the Act are entitled to exclude members of the public without assigning a reason so long as they do not commit any breach of the Human Rights Act or other relevant legislation, and that accordingly Mr Wu’s cause of action must fail and the interlocutory injunction must be discharged.

Result

The appeal is allowed and the injunction granted by the High Court is discharged. The appellants are entitled to costs on the appeal in the sum of $5,000 together with their reasonable expenses, including travel and accommodation costs of two counsel to be fixed if necessary by the Registrar. The High Court judgment records the agreement of both sides that in that Court the losing party should pay costs to the winning party on a Category 2B basis. The costs order in that Court is therefore reversed and Mr Wu is ordered to pay costs to Sky City on that basis.

McGRATH J

I agree with the majority judgment that s67 of the Casino Control Act 1990 (the Act) excludes any common law principle which otherwise might require the appellants to have good reason before refusing Mr Wu entry to their licensed casino premises. The section provides as follows:
67. Entry to and exclusion of entry from casino – (1) The fact that a casino is licensed under this Act shall not entitle any person to enter or to remain on the casino premises as against the holder of the casino premises licence or the casino operator’s licence; and, subject to any right conferred by or under any other Act, every person shall leave the casino premises when required to do so by or on behalf of the holder of the licence.
(2) The provisions of subsection (1) of this section are in addition to, and not in derogation from, the Trespass Act 1982.
The ordinary meaning of the words of s67(1), down to the semi-colon, removes any entitlement to enter or remain on casino premises, which arises from the fact that the casino is a licensed enterprise. That meaning is apt to exclude any rights at common law arising from the statutory privilege of holding a licence whatever the scope of those rights may be. Secondly, subject only to rights conferred under any different Act, the remaining words of s67(1) impose a duty on every person to leave casino premises when required to do so. The duty to leave when told to do so corresponds with the removal of any entitlement to stay and the two parts of the subsection thus reinforce each other. Further reinforcement of s67(1) is given by s67(2) which confirms that the provisions of s67 are supplementary to those of the Trespass Act 1980.
There is no qualification to the duty under s67(1) to leave the casino that is expressed by reference to the Casino Control Act itself, the sole such qualification being expressed by reference to rights arising under “any other Act”. This makes it clear that the prohibitions on discrimination contained in the Human Rights Act 1993 are not excluded by s67 and apply to the holders of the casino licences. It was not suggested in the course of argument that any Act other than the Human Rights Act conferred rights on members of the public that are relevant in the present context.
This view of the ordinary meaning of the words of s67 is consistent with its context among the provisions in Part IV of the Act dealing with Operation of Casinos which regulate a number of aspects of the conduct of the licensed business and premises. Licensees are precluded from imposing a charge for admission to casino premises (s64). Regulations may be made, by Order in Council, which control or prohibit the admission of persons to the licensed casino premises (s68). In the absence of such regulations, however, s67 states the position in respect of the public’s right to enter and remain on premises. As indicated, in general, it negates such rights as against the licence holders. The overall effect is that licence holders, while precluded from charging for entry or the right to play any game, are otherwise free to choose which members of the public they will admit to or exclude from the casino premises in the exercise of their private rights of ownership of the business and their ownership or occupation of the premises.

Such a meaning of s67 is consistent with the statutory scheme whereby the holder of, in particular, the casino operator’s licence is responsible for the proper operation of the casino. This responsibility is reflected, first, in the mandatory considerations addressed by the Casino Control Authority at the time Casino Licences are granted, under Part II of the Act and, secondly, in the provisions for Supervision and Disciplining of licensees under Part VII of the Act. In this wider statutory context s67 can be seen as a provision with the purpose of facilitating the orderly conduct of casino businesses. The ability to control who may enter and remain on the premises is to be seen as an important part of the means by which Parliament envisaged licensees would discharge their responsibility for ensuring the proper conduct of the casino in terms of the statutory requirements. The nature of a casino business is clearly regarded by the legislature as requiring the giving of that unusual degree of operator control over public access to the licensed facility.
It would be inconsistent with that statutory language and purpose for the Courts to lay down limits, akin to public law controls, on licensees’ decisions on who to exclude from or require to leave casino premises. This is not a situation in which human rights norms favour a departure by the Courts from a purposive interpretation of the words of s67 in accordance with s5 of the Interpretation Act 1999. Those norms are protected by the section itself. Similarly there is no basis for reading into s67 implied controlling requirements to be observed before patrons can be excluded.
For these reasons, in my view, the appellants were not bound to act reasonably in excluding the respondent.
As the Court is unanimous that, on its true construction, the application of s67 determines the appeal in the appellants’ favour, it is not strictly necessary for me to discuss the scope of the underlying common law principle of prime necessity which was central to the respondent’s argument. The majority, however, have prefaced their application of s67 with an analysis that indicates they find persuasive Mr Taggart’s argument that the common law of New Zealand would now recognise a casino or other licensed gambling facility as “a business affected by the public interest” if the operator enjoys a monopoly or relative monopoly. On this approach in the absence of s67 casino operators would be permitted to exclude the public from the casino only for an articulated good reason.
Like the majority I do not wish to express a concluded view on the question but, in view of what they say, I wish to express my tentative views on the scope of prime necessity in New Zealand. In Vector Ltd v Transpower New Zealand Ltd [1999] 3 NZLR 646 a Full Court of this Court traced the common law doctrine back to Lord Ellenborough’s exposition in Allnutt v Inglis (1810) 12 East 527 which followed the now lesser known decision in Bolt v Stennett (1800) 8 Term Rep 606. The Court identified the generally understood source of the doctrine as being Sir Matthew Hale’s “Treatise de Portibus Maris” written in the latter part of the 17th Century but not published during the next hundred years. Both Hale’s writing and each of the four separate judgments in Allnutt v Inglis identified the principle as being that private property was “affected with a public interest” where the public had the right to resort to or use the property and the owner had a monopoly for the purpose. In such a case the owner was required to permit the use of the affected property at a reasonable price.
In New Zealand, prior to 1918, attempts by litigants to avail themselves of the principle by reference to the early 19th century English cases were largely inconclusive in indicating whether it applied in New Zealand and if so in what forms. It was the Privy Council decision in 1918 in Minister of Justice for the Dominion of Canada v City of Lévis [1919] AC 505 which was pivotal in recognition by the New Zealand Courts of the common law principle of prime necessity. The Vector Ltd decision confirmed that recognition.
In City of Lévis Lord Parmoor, who delivered the judgment of the Privy Council, coined the term “prime necessity” in relation to supply of water for domestic and sanitary purposes (p513). It was on the premise that water is a matter of prime necessity that he applied, without acknowledgement of the earlier English authority, a principle akin to but, narrower than that stated in Allnutt v Inglis. Thereafter in New Zealand the element of a necessary service or commodity appears constant in the cases which followed City of Lévis up to and including Vector Ltd. It is sufficient to refer to four of them. In Mayor of Auckland v The King (1924) GLR 415 Stringer J considered collection of refuse at Post Offices and held “it is a matter of necessity in the interests of public health that refuse of the character here involved should not be allowed to accumulate…” (p416). In State Advances Superintendent v Auckland City Corporation and another [1932] NZLR 1709 CA, a case involving a water supply authority with a practical monopoly, Myers CJ in his judgment listed as first among the principles upon which the Courts had previously acted “that the supply of water is a matter of prime necessity” (p1715). In Wairoa Electric Power Board v Wairoa Borough [1937] NZLR 211 Ostler J stated the principle as being that the a statutory body having a “practical monopoly to supply of a commodity of prime necessity…it is under a legal liability to supply that commodity at a reasonable price…” (p215). Ostler J put the supply of electrical energy into the same category as the supply of water because : “it has become a prime necessity in recent years.”
There is no common pattern of recognition in the common law countries of this aspect of the writings of Hale as expressed in Allnutt v Inglis. The High Court of Australia, has rejected the argument that there is a principle of law that when a utility or other body exercised an exclusive franchise, it is under a duty to provide the service: Bennett and Fisher Limited v The Electricity Trust of South Australia (1962) 106 CLR 492 per Dixon CJ at pp500-501, (see also Halsbury’s Laws of Australia Electricity: Obligation to Supply, para 170-6205). Nor has it been applied in modern times in England (see Constitutions, Property and Regulations, PP Craig, [1991] Public Law 538. On the other hand in the United States the relative popularity of Hale and Allnutt v Inglis appears, at least in part, as a means of bypassing constitutional restraints on legislative price regulation (see the discussions in Constitutions, Property and Regulations at pp543 to 551 and Public Utilities and Public Law, M Taggart, in Essays on the Constitution (1995) Joseph ed, Brookers, p214, 221 to 227). It was probably for this reason that in Vector Ltd this Court observed that United States cases “must be located in their own constitutional setting” (para 42). The United States case law appears to have had no influence in the development of the principle in New Zealand, not being mentioned in any judgment since 1918 until the unreported decision in Marlborough County Council and Blenheim Borough Council v McFarlane (CA48 and 51/84, 19 December 1984).
The effect of the submission to which the majority is attracted, would be to remove from the principle the requirement of the element of “public necessity”. Only by doing that will there be a basis for applying it to restrain the operators of casinos, or other licensed gambling facilities, from excluding people from their premises without giving good reason. Given the rather anachronistic nature of the doctrine and its limited relevance in the modern political economy as Vector Ltd demonstrates, it would be strange for the Courts to attempt to broaden the scope of its traditional application in New Zealand. And, given the modern legislative practice of addressing situations possibly covered by it directly, it may well be no occasion arises in which it ever becomes necessary for this Court to decide the modern scope of the common law doctrine.
For the reasons given in paragraphs [41] to [47] above, in agreement with the majority, I would allow the appeal and set aside the interim order.

Solicitors:

Minter Ellison Rudd Watts, Auckland for Appellant
Keegan Alexander, Auckland for Respondent

[2002] NZCA 192

7 August 2002