The Liquor Legislation Amendment (Statutory Review) Bill 2014 passed through the Lower House of Parliament on 23 October 2014 and then through the Upper House on 12 November 2014. The Bill will commence on its proclamation.
The Bill is quite large and follows the Government response to the Liquor and Gaming Review undertaken by Michael Foggo in 2013. As such, there are a number of necessary and common-sense amendments made to the Liquor and Gaming legislation, however the Bill also contains some nasty surprises. The major and nastiest surprise is the introduction of a second 3 Strikes Regime into the Liquor Act 2007, focussing on the Liquor Act defence of the licensee selling alcohol to a minor. This is a “prescribed defence” for the purposes of this second 3 Strikes Regime. Under the Regime, for a first strike, the licensee is sent a “please explain” notice, requiring the licensee to justify why the licence should not be suspended for up to 28 days. On a second strike within a period of 12 months, the licence is automatically suspended for 28 days. On a third strike, the licence is automatically cancelled.
Hotel and packaged liquor licences are extremely hard to get in the current regulatory environment. If one of these licences is cancelled for incurring a third strike then there is every likelihood that an application for the grant of a replacement licence would be refused by the Authority. Even if a replacement licence is granted by the Authority, then, it would be a virtual certainty that an application for an extended trading hour authorisation, to do no more than simply allow the venue to trade in the manner that it previously could, would be refused.
A strike however is only recorded if the licensee is convicted of an offence under s.117(1) of selling alcohol to a minor, or receives a penalty notice for that type of offence and pays the fine.
By stark contrast with the existing 3 Strikes Regime, the imposition of a second or third strike involves an exercise of discretion by either the Secretary or (in the case of a third strike) the Authority. There is also an array of types of “remedial action” that the Secretary or the Authority could impose instead of suspending or cancelling the licence. None of these features apply to the new 3 Strikes Regime involving the sale of alcohol to minors.
Under the existing 3 Strikes Regime, a licensee has a right of appeal from a decision of the Secretary to the Authority, or from a decision of the Authority to the NSW Civil & Administrative Tribunal. An appeal operates as a stay. There is no right of appeal whatsoever under the new 3 Strikes Regime for either the suspension or cancellation of the Licence.
The obvious message to licensees is that any prosecution taken or penalty notice issued for the sale of alcohol to a minor by the licensee must be vigorously contested in the Local Court, where such matters are heard, or on appeal to the District Court, or higher. No longer can licensees take the cheap option and simply pay the amount on the penalty notice, which is a fine of only $1,100.00. How much is 28 days’ worth of trade worth?
At the request of the Police, the NSW Government has agreed to remove the “all other reasonable steps to prevent intoxication defence” contained in s.73(4) of the Act. In its place the defence will be that the licensee or the licensee’s employees took the steps set out in the Guidelines to be issued by the Secretary, relating to the prevention of intoxication on licensed premises. As to what will be contained in these Guidelines is a matter for conjecture. However, the Government hinted in the Upper House debate that these Guidelines will contain the step that the licensee introduced drink restrictions after a certain hour, which will probably be the drink restrictions applying after 12:00 midnight for licences within either the Kings Cross Precinct or the Sydney CBD Entertainment Precinct, commonly referred to as the “no shots” restrictions.
One welcome addition to the Act is a more streamlined provision for the transfer of a licence from employee to employee where the ownership of the business remains the same. This will be by way of notification to the Authority, following which the Authority will then transfer the licence, provided that the incoming licensee meets the tests of having held the same type of licence within the last three years and not being convicted of a prescribed defence of the type under the existing 3 Strikes Regime within that period.
The sting in the tail for owners of licensed premises is that while the transfer procedure has been streamlined, if it is necessary to make an owner-in-possession application, then if the application is not made within 28 days of the current licensee being excluded, the licence is suspended, presumably from the exclusion date, until such time as it is transferred by the Authority.
Bruce Bulford
13 November 2014
