Liquor Act Disturbance Complaints and the Order of Occupancy "But that’s not fair, my venue was here first".

Introduction

Encroachment by new residential development has always been a difficult issue for the owner of a licensed venue.  One day the venue can easily comply with the usual noise conditions, principally because of the distance between the venue and the nearest residence.  The next day however, as new residential development occurs around the venue, the venue owner finds itself in breach of the usual noise conditions and possibly on the receiving end of a disturbance complaint.  The common response of the owner in that position is usually “but that’s not fair, my venue was here first!”

The current liquor licensing legislation for NSW is the Liquor Act 2007 (Liquor Act).  The Act imposes an obligation upon the decision maker determining a disturbance complaint, to consider the “order of occupancy”, between the licensed premises concerned and the person/organisation making the disturbance complaint (s.81(3)(a) Liquor Act 2007).  On 24 December 2010 the Casino, Liquor & Gaming Control Authority (Authority) published its review determination in respect of a disturbance complaint previously found to be established against the Hotel Illawarra at Wollongong (Hotel).

Authority’s review determination

The order of occupancy between the Hotel and the complainant was considered by both the Director-General (the decision maker) and then (on review) by the Authority.  The Director-General varied the usual noise conditions so as to exclude the complainant’s residence.  On a review of that determination, the Authority went considerably further and excluded any residence, within any building, within 150 metres of the Hotel.  The Authority considered that a “more liberal regulatory response” was required in respect of noise management (see the Authority’s review determination at [80]).

Another significant point for the Authority was that the complainant’s residence did not comply with the development consent conditions for sound proofing, imposed on the change of the building from commercial to residential.

How does this affect you?

The Authority’s determination reignites the order of occupancy issue that venue owners have had to face for some time.  The determination indicates what should happen when a disturbance complaint is proven against a licensed venue.

The Authority’s determination also ignites this issue – if the surrounding residential development is not constructed in accordance with council’s requirements for sound proofing, then why should noise measurements to be taken at those non-complying residential premises, under the usual noise conditions, regardless of the order of occupancy?

Nearly all NSW hotel licences, which have extended trading hours, will have the usual noise conditions imposed by the former Licensing Court/Liquor Administration Board.  All nightclubs will have this condition imposed, as well as some late trading restaurants.  The text of conditions can be found at [i]Endnote 1.  The venues which have those conditions imposed, must then strictly comply with them.  In addition, when a licensee becomes the subject of a disturbance complaint (or “noise complaint” as it used to be called under the old Act), then the noise impact of the venue’s operation, will be measured against the usual noise conditions, regardless of whether they are imposed upon the licence.

Many councils are also imposing the usual noise conditions on a venue’s development consent, usually when the issue of extended trading hours are before the council in a development application.  Sydney City Council has “Standard Conditions of Development Consent” which contain the usual noise conditions.  Non-compliance with the usual noise condition can put these (development consent) extended trading hours at risk of cancellation.  While this cancellation scenario will not arise in respect of a Liquor Act disturbance complaint, if the venue has the benefit of the order of occupancy provisions in s.81(3)(a) of the Act, the same cannot be said in respect of the venue’s extended trading hours under its development consent.

The Authority accepted the argument put forward by the Hotel, that the usual noise conditions should be further altered, to protect the Hotel against what was called “development creep”.  This was achieved by the Authority adding the following qualifier to the standard noise condition:           

“For the purposes of this condition, affected residents and/or residential premises excludes any residence which is in any building within 150 metres of the Hotel Illawarra.” (see the Authority’s review determination at [91]).

The need for further reform

This order of occupancy benefit is only found in the Liquor Act and only in relation to disturbance complaints.  Accordingly, the Authority does not have to take this benefit into account when dealing with an application for extended trading hours, or more particularly, when determining the appropriate penalty when a licensee is found to be in breach of the usual noise conditions.  So currently, in order for the benefit to apply to a venue, a disturbance complaint needs to be taken.  Alternatively, the licensee can make an application to alter the usual noise conditions.  But this application involves significant time and expense to pursue and there is no certainty that the Authority will grant the application, as a result of submissions that will inevitably be made against the conditions being so varied.

Wouldn’t it be better in the circumstances, for the Liquor Act to be altered, so as to introduce a uniform noise condition, which excludes from the definition of “affected premises”, any residential premises that have come into existence since its licence was first granted, or when extended trading hours were granted?

The next challenge – assessing acoustic compliance at the nearest residential premises regardless of order of occupancy

One of the significant issues for the Authority in the Hotel Illawarra Disturbance Complaint, was that the complainant’s premises did not comply with development consent conditions requiring new residential dwellings to be sound proofed.  So taking this issue one step further, if there is a council development standard, requiring new residential dwellings to be sound proofed and those dwellings are not constructed in accordance with that standard, then why should the usual noise criteria apply for the benefit of those non-conforming premises?

To illustrate, this there is currently on exhibition a draft Sydney Development Control Plan 2010.  Section 3.2.9.10 deals with “acoustic privacy” for new residential dwellings.  While there is a stated preference for dwellings to be naturally ventilated, if those dwellings cannot achieve the specified internal dB rating, then the dwelling must be air conditioned.

These acoustic privacy requirements are not simply designed to ensure acoustic privacy as between the occupier of those new dwellings and the closest licensed venue, but rather to ensure acoustic privacy between the occupier and all surrounding development.  The noise impact of surrounding development will include the noise generated by passing road traffic, trains, planes, the air conditioning plant of surrounding occupiers and the general noise activity found in built up areas.

While the Authority in the Hotel Illawarra Disturbance Complaint added an important qualifier to the usual noise conditions, there should be further qualifiers added, along these lines:

“If the nearest affected residence:

(a)        is sound proofed in accordance with prevailing council standards existing at the time of its construction, then the measurement of noise emitted from the licensed premises is to be taken inside the residence, in a habitable room closest to the centre of the residence, with all windows and doors closed.  If the council’s standard requires this residence to be air conditioned, then the air conditioning is to be turned on with a medium fan speed at the time when the noise measurements are being taken;  or

(b)        is not sound proofed in accordance with the prevailing council standard existing at the time of its construction, then this residence is not to be considered as an affected residence for the purposes of these noise conditions.”

If the Authority in the Hotel Illawarra Disturbance Complaint, effectively “future proofed” the Hotel against further encroaching residential development, then why shouldn’t the Liquor Act be changed, to also “future proof” all venues against possible noise complaints or non-compliance with the usual noise condition, where residential premises are not constructed in accordance with the council’s requirements for sound proofing, regardless of the order of occupancy?  Similar amendments should also be made to the Environmental Planning & Assessment Act 1979 (EP&AA), to override any development consent condition, imposed upon licensed venues either before or after the amendment to also future proof them against possible breaches of the EP&A, caused by non-complying residential premises.

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