Lai See
PUBLISHED : Friday, 07 March, 2014, 12:22am
UPDATED : Friday, 07 March, 2014, 12:22am

Another broadside launched against bar licensing regime

BIO

Howard Winn has been with the South China Morning Post for two and half years after previous stints as business editor and deputy editor of The Standard, and business editor of Asia Times. His writing has also been published in the Far Eastern Economic Review, the Wall Street Journal, and the International Herald Tribune. He writes the Lai See column which focuses on the lighter side of business.
 

Mr Justice Kevin Zervos recently handed down yet another decision in which he finds that the Liquor Licensing Board (LLB) and the Municipal Services Appeals Board (MSAB) have acted unreasonably and unfairly in their dealing with bars. Last time we wrote on this subject we took the view that he had given the LLB a poke in the eye. But this latest decision goes much further and firmly sets out the law as to the exercise of the statutory powers granted to the LLB.

As such it should be required reading for all current and potential bar owners. The latest case involves a bar known as Icon on the ground floor of Parekh House at 63 Wyndham Street, Central. The bar appealed against three conditions imposed by the LLB when it was granted a new liquor licence in April 2013. It appealed against these conditions before the MSAB in mid-July which dismissed the appeal more than three months later on October 25, giving its reasons on November 11. On December 20 the bar applied, before Zervos, and was granted leave to apply for a judicial review of the MSAB's decision. The review was heard in February 2014 and was granted, as were costs. So a win for the bar, but it took almost a year to get redress.

Not all bar owners are prepared to bear the necessary cost of such proceedings and either put up with unreasonable conditions or are forced out of business. This was the case with the Coast bar earlier this year, among others. The reasons for the judge's decision to grant the review give an interesting insight into the low-level reasoning and shoddy processes employed by the LLB and the MBAS with regard to Icon. One can only speculate as to the quality of their rulings and processes with regard to other bars.

The LLB introduced three conditions that became the subject of the review at the request of the police, who were consulted as part of the LLB's normal procedure. These were imposed for the sake of the public interest to avoid "nuisance" even though the bar was in an area zoned for commercial use. They involved closing windows and doors from 11pm to 8am, no sale of liquor after 2am, and no music to be played after 11pm. In the event of an appeal the LLB is obliged to forward its reasons to the MSAB. The LLB said that most of the bars in the neighbourhood were required to keep their doors and windows closed at 11pm. Some objectors to the bar's licence had said there was only a common wall between the bar and their building and the conditions reflected residents' "basic need for sleep". One of the LLB's conditions was dropped at the appeal but the MSAB upheld the other two, concluding, Zervos says in his decision, that "the LLB and the process of its decision-making were 'beyond reproach'".

However, the owners of Icon pointed out in the review hearing that the MSAB relied on the findings of fact by the LLB, which contained three basic errors. The applicant showed that most of the licensed premises were not required to keep their doors and windows closed after 11pm. Only 37 out of 118 within a radius of 125 metres of Icon were required to do this. Some bars close to Icon were also allowed to continue selling liquor after 11pm and had no time restrictions. Zervos remarks: "It was established to my satisfaction that the findings of fact by the MSAB were inaccurate and misleading."

Also, the LLB's assertion that the wall between the bar and residents was a common wall was also wrong. "The mistaken facts seriously flawed the MSAB's decision. They were mistakes as to existing facts which were objectively verifiable. They played a material part in the MSAB's reasoning for which the applicant was not responsible. In my view, it gave rise to objective unfairness which makes it a mistake of law," Zervos says.

Zervos also found the MSAB's reasoning to be unsound and unfair in other issues raised by the MSAB. He went on to make the point that the conditions recommended by the police were "general prohibitive conditions" that were sometimes imposed on bars to "broadly deal with the problem of noise". While he said they may be appropriate in some cases, "a tendency to impose formulaic conditions" without considering specific situations "should be avoided". "A general approach like this is not fair, and is not fulfilling the licensing body's responsibilities to it under statute."

Have you got any stories that Lai See should know about? E-mail them to howard.winn@scmp.com

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