Adrenalin Sports Brisbane Pty Ltd v Mackenroth [2003] QSC 184

SUPREME COURT OF QUEENSLAND CITATION: Adrenalin Sports Brisbane Pty Ltd v Deputy Premier Treasurer and Minister for Sport, The Honourable T M Mackenroth MLA [2003] QSC 184 PARTIES: ADRENALIN SPORTS BRISBANE PTY LTD (applicant) v DEPUTY PREMIER, TREASURER AND MINISTER FOR SPORT, THE HONOURABLE T M MACKENROTH MLA (respondent) FILE NO/S: SC No 2547 of 2003 DIVISION: Trial Division PROCEEDING: Application DELIVERED ON: 20 June 2003 DELIVERED AT: Brisbane HEARING DATE: 10 June 2003 JUDGE: McMurdo J ORDER: 1. Application dismissed. 2. Applicant pay the respondent’s costs of and incidental to the application to be assessed. CATCHWORDS: ADMINISTRATIVE LAW – JUDICIAL REVIEW - where applicant applied for gaming license and was refused – where applicant exercised right of appeal to respondent – where respondent disallowed appeal – where applicant seeks statutory order of review of respondent’s decision – where respondent characterised applicant’s premises as a nightclub – where respondent required to be satisfied public interest will not be adversely affected – whether respondent could reasonably have characterised applicant’s premises as a nightclub – whether respondent considered public interest question - whether respondent could reasonably have disallowed the appeal Gaming Machine Act 1991 (Qld), s 17, s 29, s 29(9)(a), s 30, s 55 Judicial Review Act 1991 (Qld), s 33 Buck v Bavone (1976) 135 CLR 199, applied Minister for Immigration and Ethnic Affairs v Taveli (1990) 23 FCR 162, applied -- 1 of 9 -- 2 O’Sullivan v Farrer (1989) 168 CLR 210, applied COUNSEL: P Roney for the applicant J Logan SC, with G Handran, for the respondent SOLICITORS: Hynes Lawyers for the applicant Crown Law for the respondent [1] McMURDO J: Since 1998, the applicant has operated a business called “Adrenalin Sports Café and Bar” at Charlotte Street, Brisbane. At these premises, there are bars, a dining area, pool tables and interactive amusement machines. The premises have a strong sporting theme, featuring sporting memorabilia and television screens showing sporting events. Until late 2001, the premises were operated under the authority of an on-premises (cabaret) licence, but since then they have operated under a general licence granted under s 58A of the Liquor Act 1992 (Qld). This change is said to reflect a change in the business itself, which is relevant to whether the premises can be fairly described as a nightclub, the relevance of which is discussed below. [2] The applicant wishes to add gaming machines to its premises. That requires a licence under the Gaming Machine Act 1991 (Qld). In October 2000, an application on its behalf was made to the Queensland Gaming Commission for a gaming machine licence for 35 machines. Extensive correspondence passed between the executive director of the Queensland Office of Gaming Regulation and the applicant’s consultant who was prosecuting the application. Ultimately, on 5 December 2001 the application was refused by the Commission. By a letter dated 24 December 2001, the executive director advised the applicant of that decision, and gave reasons in these terms: “(a) The general layout and range of amenities and services provided at Adrenalin Sports Café and Bar (“Adrenalin”) would suggest that the facility is more in the nature of a nightclub. (b) Advertising in the Yellow Pages under Nightclubs and Discotheques clearly indicate that the premises is being promoted as a nightclub. (c) The premises has operated for a long period of time under an On Premises (Cabaret) licence; is historically recognised as a nightclub and the nature (including physical layout) of the premises has not changed since a general licence was provisionally granted on 11 September 2001. (d) Figures provided indicate a low level of day time trading.” [3] Section 29 of the Act gave the applicant a right of appeal to the relevant Minister. 1 The applicant appealed on 11 January 2002. The Minister disallowed the appeal, that being communicated to the applicant by a letter from the executive director 1 See s 29(9)(a), the applicant having being refused, under s 55, the grant of a gaming machine licence. -- 2 of 9 -- 3 dated 14 February 2002. The Minister’s reasons were expressed in that letter as follows: “The Minister was not satisfied that the public interest would not be adversely affected if he set aside the decision of the Commission. His reasons for disallowing the appeal are – 1. The general layout and range of amenities and services provided at Adrenalin Sports Café and Bar (“Adrenalin”) would suggest that the facility is more in the nature of a nightclub. 2. Advertising of the premises in the Yellow Pages under Nightclubs and Discothèques clearly indicate that the premises is being promoted as a nightclub. 3. The premises has operated for a long period of time under an On-Premises (Cabaret) Licence, is historically recognised as a nightclub and the nature (including physical layout) of the premises has not changed since a general licence was provisionally granted on 11 September 2001. 4. Figures provided indicate a low level of a day time trading.” It can be seen then that the reasons attributed to the Minister were in identical terms to those given by the Commission. [4] This is an application for a statutory order of review of the Minister’s decision. Before going to the grounds for the application, it is necessary to discuss some provisions of the Gaming Machine Act as well as a guideline issued by the Commission, which explains why the question of whether the premises were in the nature of a nightclub was important. [5] Section 55 provides that despite any other Act or law, gaming and the conduct of gaming on licensed premises under the Act is lawful, and the Commission may, having regard to any recommendation of the chief executive and to such other information or material as the Commission considers is relevant, grant or refuse to grant gaming machine licences. It further provides that the other information or material to which the Commission may have regard includes information or material about social and community issues. Section 56, in the Act in force at the time the application was made, 2 permitted an application for a gaming machine licence to be made, in effect, only by someone holding or applying to become the holder of a club liquor licence or a general liquor licence under the Liquor Act 1992 (Qld). The original submission in support of the application records that the applicant was then in the process of applying for a general liquor licence, which it obtained in September 2001. The evident intention was to exclude gaming machines from particular types of premises, whose operations could be characterised by reference to the type of liquor licence required. Section 57 required the chief executive to consider an application for a gaming machine licence and to make a recommendation about it to the Commission. 2 See Reprint No 5 as in force on 7 July 2000 -- 3 of 9 -- 4 [6] After the application was lodged, but before it was determined by the Commission, s 17 was amended to insert subsections which included the following: 3 “(2) The commission may issue guidelines. (3) Without limiting subsection (2), a guideline may give guidance about – (a) the attitude the commission is likely to adopt on a particular issue; or (b) how an applicant for a licence, authorisation or approval should deal with issues involved in the proper formulation of the application or supporting material related to the application. Examples of subsection (3) – 1. The commission might issue a guideline stating its attitude to gaming machines in shopping centres. 2. The commission might issue a guideline stating how it is likely to decide questions about the location of gaming machine in licensed premises or the proximity of gaming machines to automatic teller machines. 3. The commission might issue a guideline setting out the matters that should be dealt with in a community impact statement accompanying an application. (4) A guideline may be replaced or varied by a later guideline issued under this section.” The Commission had published a document entitled “Information Notice for Applicants for Gaming Machine (Site) Licences and Increases” in May 2000. The terms of that document would not have particularly discouraged this application. But in June 2001 the Commission published a document entitled “Guidelines – Applicants for Gaming Machine (Site) Licences and Increases”, some of which reveals matters of policy which, in the view that the Commission took of the applicant’s premises, were important to the outcome of this application. [7] The guidelines expressed concern with the growth of gaming, and the effect of this upon the community. They expressed a view of the Government “that gaming machine licences should be restricted to specifically recognised gaming venues”. Under a heading “Hours of gaming” it was said that, as a general rule, the Commission’s attitude was that gaming “during the span of ordinary (liquor) trading hours of 10.00 am to 12 midnight … is acceptable”. It was also stated that: “Applicants should also be aware of the Commission’s attitude to the following – Location –
shopping centres, convenience locations and other public areas are generally considered inappropriate locations for gaming machines; 3 Gaming Legislation Amendment Act 2000, s 23 -- 4 of 9 -- 5
locations in close proximity to child care centres, schools, places of public worship and community social services are also considered inappropriate locations for gaming machine (sic). Type of facility –
the total publicly accessible area of the facility must be of a sufficient size and capable from the outset of providing a range of amenities;
premises such as bar and grills, restaurants, cinemas, nightclubs, cabarets and bowling alleys are considered unsuitable as gaming venues;
the dominant purpose of the facility must either be the serving of alcohol in the case of a hotel or the provision of services to members in the case of a club. …” [8] It is not immediately apparent from the document why the Commission considered that nightclubs were unsuitable as gaming venues, compared with hotels. Perhaps it was because of the extended trading hours of nightclubs, having regard to what the guidelines had said about the appropriate hours for the use of gaming machines. The respondent’s submissions suggested that nightclubs were an example of what is described as a “convenience location”, which seems to involve places where people go for reasons unconnected with gaming, and at which it is considered undesirable that there be a temptation of the convenient availability of gaming machines. It is irrelevant to consider the merit of the policy which distinguishes nightclubs from hotels in this way. Further, the applicant concedes that the guidelines are not inconsistent with the Act or otherwise unlawful. [9] The stated approach to nightclubs then explains the focus upon whether the subject premises were in the nature of a nightclub in the Minister’s decision. The characterisation of them as a nightclub was plainly critical to his decision. The applicant says that the decision should be reviewed, essentially for two reasons. First, it is contended that the decision involves an application of the guidelines without reference to the particular facts and circumstances of the applicant’s case. Put another way, the complaint is that the Minister has considered only whether the premises are a nightclub, and has not addressed the question or questions as required by the Act. Secondly, it is submitted that no reasonable person in the Minister’s position could have concluded that the applicant’s premises were in the nature of a nightclub, or that if they were, that the licence should not be granted. [10] The Minister was required to determine this appeal according to s 30 which provided, in part, as follows: “(1) The Minister is to consider – (a) the contents of the appeal under section 29 and information or material lodged with the appeal; and (b) information or material that is – -- 5 of 9 -- 6 (i) given to the Minister by the appellant; and (ii) given to the Minister by any person referred to in section 29(4)(d); and (iii) given to the Minister by the commission in respect of the appeal; and (iv) given to the Minister by the chief executive in respect of the appeal; within 14 days of the lodging of the appeal; and (c) such other information or material as the Minister considers relevant; and, if the Minister is satisfied that the integrity of gaming and the conduct of gaming will not be jeopardised and that the public interest will not be adversely affected, the Minister may direct – (d) that the appeal be disallowed; or (e) that the decision or determination appealed against be set aside or varied. (2) If the Minister is not so satisfied, the Minister must direct that appeal be disallowed. …” Accordingly, the Minister was empowered to allow the appeal only if satisfied of certain matters. One was that the integrity of gaming and the conduct of gaming would not be jeopardised. In this case, there is nothing to indicate that these were matters of which the Minister was not satisfied. He also had to be satisfied that the public interest would not be adversely affected by allowing the appeal and granting the licence. It was only if the Minister was satisfied as to that matter that he had a discretionary power to allow the appeal. Accordingly, he was required to decide whether he was satisfied that the public interest would not be adversely affected. [11] I have set out at [3] above the relevant part of the letter which advised of the Minister’s decision, from which it will be seen that it was stated that “the Minister was not satisfied that the public interest would not be adversely affected if he set aside the decision of the Commission”. From that statement, the Minister appears to have considered the public interest question as required by s 30. However, the applicant submits that what were then stated as the reasons for disallowing the appeal, taken with other evidence, show that the Minister did not truly consider the public interest question, but only a narrower question of whether the premises were in the nature of a nightclub. In this Act, “public interest” was originally a defined term, but that definition was omitted by an amendment prior to the decisions of the Commission and the Minister in this case. 4 The term “public interest”, being undefined, is then not limited by any express indication of the considerations by 4 Omitted by Gaming Legislation Amendment Act 2000 (Act No 51 of 2000) with effect on and from 1 December 2000 -- 6 of 9 -- 7 reference to which the Minister was to assess the effect on the public interest. In O’Sullivan v Farrer (1989) 168 CLR 210 at p 216 Mason CJ, Brennan, Dawson and Gaudron JJ described the expression “in the public interest” as one which “when used in a statute, classically imports a discretionary value judgment to be made by reference to undefined factual matters, confined only “insofar as the subject matter and the scope and purpose of the statutory enactments may enable … given reasons to be (pronounced) definitely extraneous to any objects the legislature could have had in view”. 5 The characterisation of the use of the subject premises is a matter relevant to the consideration of the effect on the public interest of the grant of a gaming licence. As it is conceded that the guidelines were not inconsistent with the Act, the Minister could assess whether these premises were a nightclub, in the course of his consideration of the public interest. He was required by s 30 to consider the effect on the public interest, and not just the nightclub issue. The question here is one of fact, being whether the Minister did in truth consider that wider matter of the public interest. [12] On this factual question, the respondent seeks to rely upon his own statement of reasons, which were provided pursuant to s 33 of the Judicial Review Act 1991. They were provided on 23 August 2002, being more than six months after the Minister’s decision, with stated reasons, was communicated. There is no affidavit by the Minister, and no verification of these (later) reasons. I do not think that he should be entitled to rely upon this subsequent statement of reasons to prove what he had considered. For the Minister, it was submitted that the statement was admissible in his favour as a consequence of its being given “in the context of a continuum of administrative process”, i.e. that they are just as much part of the decision making process as the original communication of the decision. In my view, this submission should be rejected for reasons given by Davies J and Hill J in their separate judgments in Minister for Immigration and Ethnic Affairs v Taveli (1990) 23 FCR 162, in which they affirmed the decision of Wilcox J to the effect that a statement under the equivalent Commonwealth provision 6 is not admissible to prove the decision maker’s actual process of reasoning, if it was sought to be tendered against the applicant for judicial review. Notwithstanding earlier Federal Court authority, at least some of which appears to be in favour of such admissibility, 7 and the different view of French J in Taveli, I would adopt the reasoning of Davies and Hill JJ as to why the Minister should not be allowed here to rely upon this unverified statement of reasons, given so long after the decision. In the view I have reached as to this factual question, however, the admissibility of that subsequent statement of reasons is of no consequence. [13] The task of the applicant here in proving that the Minister did not consider the required question is made more difficult by the fact that the Minister’s decision is expressed in terms of his having considered that very issue. It is also difficult because the Minister was under no obligation to give reasons for his decision, 8 so that the absence of some recording of his consideration of matters, other than the nightclub question, as going to the public interest does not necessarily indicate that he gave no thought to them. As he was not obliged to give reasons, he was not 5 Citing Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492 at p 505 per Dixon J 6 Section 13 of Administrative Decisions (Judicial Review) Act 1977 (Cth) 7 Minister for Immigration & Ethnic Affairs v Arslan (1984) 4 FCR 73 at p 75; Sezdirmezoglu v Minister for Immigration & Ethnic Affairs (1983) 74 FLR 348 at 357 8 Public Service Board of New South Wales v Osmond (1985-86) 159 CLR 656 -- 7 of 9 -- 8 obliged to set out why he remained unsatisfied as to the public interest. The absence of factual findings does not prove that he ignored or overlooked something which he was obliged to consider. In addition, it must be kept in mind that the appeal was said to have been disallowed by the Minister, not because he found that the grant of the gaming licence would be adverse to the public interest, but because he was not satisfied that the public interest would not be adversely affected. It must also be recalled that the Minister was given the applicant’s detailed submissions, which put clearly the case for the Minister to be satisfied as to the public interest, and it should not lightly be inferred that he ignored or misunderstood them. [14] I do not read his decision as communicated on 14 February 2002 as saying that he was precluded from being satisfied about the public interest because this was a nightclub. Instead the letter is equally consistent with his reasoning being that upon all of the material presented to him, including the extensive submissions for the applicant, he remained unpersuaded that the public interest would not be affected. In a particular case, the characterisation of premises could of itself provide a sufficient obstacle to any countervailing factors as to leave the decision maker unsatisfied of the absence of an adverse effect on the public interest. [15] Ultimately, the applicant does not prove that, contrary to what was said in the communication of the decision, the Minister did not consider the effect upon the public interest as required by s 30. It is not established that he considered only whether the premises were in the nature of a nightclub and thereby applied the policy expressed in the guidelines without consideration of the question required by the statute and the facts of this particular case. It follows that the first basis for challenging this decision is not established. [16] That leaves for consideration the alternative case, which is that the Minister could not reasonably have characterised this as a nightclub or disallowed the appeal. The fact finding of the Commission is certainly susceptible to fair criticism. For example, the Commission seems to have been wrong in its understanding that the applicant intended to have these machines operated at any time whilst the premises themselves were open for business, when the application appears to have proposed more limited hours for the use of the machines. However, the applicant accepted that it had to establish that there was no reasonable basis for the conclusion of the Minister, although made in identical terms to that of the Commission, that “the facility is more in the nature of a nightclub”. One of the applicant’s problems here is that the term “nightclub” can cover a variety of establishments, and, as its own submissions to the Commission pointed out, the dividing line between a nightclub, and some premises operated within what are still described as hotels, could be difficult to discern. In any case there was some material which was capable of providing a basis for describing this as a nightclub. The applicant had allowed its premises to be advertised in the yellow pages under a number of different descriptions, but one of them was “Nightclubs and Discotheques”. That may not have been originally the result of a description chosen by the applicant, but it would appear that the applicant had been content to allow its premises to continue to be advertised by, amongst others, that description. It was surely relevant to consider the history of the premises, at least under their current name, and to assess whether they had been at all recognised as a nightclub. The submission lodged on 20 October with the application for this licence described the premises as “marketed towards the sport lover, and a broad up-market demographic including business people, office workers in the CBD, tourists and general nightclub goers from -- 8 of 9 -- 9 throughout the City”. A further submission in July 2001 referred to a number of inner city hotels as having undergone a substantial redevelopment so as to “trade more along the lines of a nightclub in the evening”, and the point then sought to be made was not that the applicant’s evening trading was not of that kind, but rather that these other premises had gaming facilities so that there was no incompatibility between a “nightclub image” and gaming machines. The applicant’s submissions subsequent to the guidelines took a somewhat different course by strongly arguing that this was not in the nature of a nightclub. But those earlier submissions were surely of some relevance. It was also relevant to consider the hours of trading. The proposed hours of operation of the gaming machines may have been more limited, but the closing time of 5 a.m. and a perceived higher level of trading at night than during the day, were matters providing some support for the Minister’s assessment. In summary, the applicant has not established that the characterisation of the premises as a nightclub was not open to the Minister. Nor is it shown that it was not reasonably open to the Minister to remain unsatisfied as to the public interest. It is not sufficient to show that reasonable minds could differ on the matter. Once the validity of the policy on nightclubs is accepted, and it was open to the Minister to liken this to a nightclub, this was not a case where the evidence was all one way. The difficulty in this argument for the applicant was described by Gibbs J in Buck v Bavone (1976) 135 CLR 110 at 118-119:9 “In all such cases the authority must act in good faith; it cannot act merely arbitrarily or capriciously. Moreover, a person affected will obtain relief from the courts if he can show that the authority has misdirected itself in law or that it has failed to consider matters that it was required to consider or has taken irrelevant matters into account. Even if none of these things can be established, the courts will interfere if the decision reached by the authority appears so unreasonable that no reasonable authority could properly have arrived at it. However, where the matter of which the authority is required to be satisfied is a matter of opinion or policy or taste it may be very difficult to show that it has erred in one of these ways, or that its decision could not reasonably have been reached. In such cases the authority will be left with a very wide discretion which cannot be effectively reviewed by the courts.” [17] The result is that the application should be dismissed and the applicant should be ordered to pay the respondent’s costs of and incidental to that application to be assessed. 9 See also Minister for Immigration v Eshetu (1999) 197 CLR 611 at p 654 -- 9 of 9 --