Victory Enterprises Ltd v Honiara Liquor Licensing Board [1998] SBHC 113; HCSI-CC 118 of 1998 (2 September 1998)

IN THE HIGH COURT OF SOLOMON ISLANDS

Civil Case No. 118 of 1998

VICTORY ENTERPRISES LTD, MATHEW TSANG

-v-

HONIARA LIQUOR LICENSING BOARD

High Court of Solomon Islands
(Muria, CJ.)
Civil Case No. 118 of 1998

Hearing: 26 August 1998
Judgment: 2 September 1998

A. Radclyffe for Appellant
R. Johnson for Respondent

MURIACJ: In this case, the appellant comes to this Court by way of a case stated, appealing against the decision of the Honiara Liquor Licensing Board (“HLLB”). On 1 May 1998 application for a new Retail Beer Licence be refused. The reasons for rejecting the Board met and decided that the appellant’s the application can be found from the Board’s decision itself. Briefly the Board stated:

“NEW APPLICATION

In view of the Board’s own motion of objection under section 25(1), Cap.33, of the Liquor Act and in view of the Health Report objections to the application the Board’s decision is NOT TO APPROVE the application”

There are two obvious reasons given by the Board for the rejection of the appellant’s application. Firstly, the premises in respect of which the licence had been applied were too close to the main Central Market and secondly, the physical structure of the premises was such that the entrance into the building to buy liquor was the same entrance used by the people in general who wish to enter and shop in the same premises. The first reason stems from the Board’s own objection to the application and the second stems from the inspection report from the HTC Health Inspector.

Under section 33(1) of the Liquor Act, an appeal against the Board’s decision can only be brought on the ground of error in point of law or excess of jurisdiction. This must be done within one month from the date of the Board’s decision. No suggestion had been raised here that the appellant’s appeal was out of time and must be accepted as being brought within time.

I turn now to the grounds relied on by the appellant in this case. Firstly, I deal with the ground that the Board was not properly constituted when it heard the appellant’s application for a new Retail Beer Licence on 1 May 1998. It was argued by Mr. Radclyffe that the Chairman of the Board was not properly appointed. In fact, Counsel argued, the Chairman’s appointed expired on 27 April 1998 and that when the appellant’s application was dealt with on 1 May 1998, the Board no longer had a Chairman and as such there was no properly constituted Board. Consequently the was no valid meeting of the Board on 1 May 1998.

Mr. Johnson conceded in his submission that the Acting Chairman’s “formal Appointment” expired before the hearing on 1 May 1998 and that was to coincide with the return on the substantive Chairman. However on 1 May 1998 the substantive Chairman could not attend the meeting due to illness. The members of the Board present resolved unanimously to nominate the Acting Chairman to preside as Acting Chairman over the meeting on 1 May 1998. There is evidence from the HTC President that he endorsed the resolution by the Board members to nominate Mr. Funifaka as Acting Chairman and thereafter formally appoint him as Acting Chairman of the Board in the absence of the substantive Chairman. Mr. Johnson therefore submitted that as the President subsequently ratified the appointment of the Acting Chairman, the Board was properly constituted on 1 May 1998. Counsel also found support for his argument by contending that the President had delegated his power to appoint a chairman to the Board. I do not accept the soundness of such an argument. There is no power in the Board to select their own Chairman and put to the President for ratification. The argument is also a contradiction. The President in his affidavit stated that he delegated the power to appoint a Chairman to the Board and yet retained the power to approve the appointment. This cannot be correct. I feel the President is simply trying to justify his failure to appoint a Chairman by relying on an implied power to delegate. Section 16(5), as amended, clearly says:

“5. Where the Chairman is unable to perform his functions as Chairman the Premier may appoint one of the members to act as Chairman of the Board.”

By section 16(9), the expression “Premier” includes the President of HTC. Notably, no power is extended to the Board to choose of its Acting Chairman from among its members in the absence of the Chairman. The power to appoint the Chairman vests in the President (in the case of Honiara Town Council) and if he does not make such appointment, there must necessarily is a vacancy in the position. The position must be that at the time of the meeting of the Board, there was no Chairman appointed.

The argument on behalf of the appellant follows from this is that as there was no properly appointed Chairman, the Board was also not properly constituted and therefore the meeting of the Board on 1 May 1998 was invalid. If there was no Board in existence at the time, I would accept that argument. But the HLLB had been appointed for one year from 22 November 1997, although the appointment was made on 22 January, 1998 and published on 9 February, 1998 (S.I. Gazette 9/2/98). Whether its term was effective as from 22 4 November, 1997 or 22 January, 1998 or 9 February, 1998 is of no significance for our present purpose. The fact is, the respondent Board had been properly appointed and was in existence on 1 May 1998. The question, therefore, is not whether the Board was validly constituted at the time of the meeting but rather whether or not the meeting of the Board on 1 May, 1998 was validly held. In my judgment, despite the irregularity in the appointment of the Acting Chairman the meeting of the Board was validly held. The action of the Board members in choosing Mr. Funifaka to chair the meeting and subsequently approved by the President to act as Chairman was not a result of any implied delegation of powers to the Board by the President. It was rather an action to further the proper administration of the respondent’s functions. The President had appointed a Board whose one year term in office is currently valid. He is not expected to be personally oversee the management and of functioning of the Board. Such matters are properly the business of the Board, including convening meetings to consider liquor and other business licences within the HTC boundary. These are administrative matters done to properly carry out the functions of the Board. That was what happened in this case. In a recent case of Club Freeway -v- Honiara Liquor Licensing Board, CC28/98 (Judgment given on 28 August, 1998), Kabui J. also dealt with the question of the validity of the meeting of the HLLB. In that case His Lordship held that the meeting of the Board on 16 December, 1998 was invalid. The basis for His Lordship’s decision was that since there was no Board in existence at the time, there could not be a valid meeting of the Board. That is not the position in this case.

In my judgment, therefore, although the President of H.T.C did not appoint Mr. Funifaka to act as chairman at the time the Board met on 1 May 1998, the Board’s action in nominating Mr. Funifaka who was previously appointed as Acting Chairman of the Board to again chair to meeting of the Board on 1 May 1998 which action was subsequently approved by the President was an action necessary for the proper discharge of the legal obligations of the Board. The meeting of 1 May 1998 convened and chaired by Mr. Funifaka was validly conducted.

In any case, I am of the view that section 34 of the Interpretation and General Provisions Act 1978 would also apply in this case. That section says:

“34. An act or decision of a body, whether corporate or unincorporated, constituted or established by an Act is not invalid by reason only -

......

(b) of defect or irregularity in connection with the appointment or election of one or more than one member of the body; or

(c) of an irregularity in the convening of a meeting of the body.”

Even if the appointment of the acting chairman or the convening of the meeting was or were both irregular, section 34 would operate to save the action of the Board in this case. A provision such as section 34 of the Interpretation and General Provisions Act is a reflection of the wisdom of Parliament in enacting provisions of the law which saves actions of legally constituted bodies despite irregularities in the appointment of their members or in the conduct of their meetings. Again despite the forceful argument of Counsel for the appellant in this case, the court cannot accede to the suggestion that the meeting of the Board on 1 May, 1998 was invalid

The next ground of the attack against the Board’s decision in refusing the appellant’s application is that the Board was wrong to base its decision mainly on the basis that the appellant’s premises was close to the Honiara Main Market. Mr. Radclyffe argued that the fact that a retail liquor outlet is near the market is not objectionable per se unlike that of a public bar. I agree. However I also agree with Mr. Johnson’s contention that the character and the necessities of a public place such as a market place and its surroundings where vendors, purchasers, members of the public including women and children, have access to, are matters to be borne in mind. These are considerations well within the contemplation of the legislature as evidenced by paragraphs (d) and (f) of section 23(4) of the Liquor Act:

“23.........

(4) Anyone or more of the following objections may be made to an application for the grant of a licence, other than a club licence, a temporary packet licence or an occasional licence -

............

(d) that the reasonable requirements of the neighbourhood do not justify the granting of the licence

...........

(f) that the quiet and good order of the neighbourhood in which the premises in respect of which the application is made are situated will be disturbed if a licence be granted.”

In the exercise of its discretion it was well within the discretion of the Board to bear in mind those consideration. If the Board took into account those considerations which in this case it clearly did, then it was well within the discretion of the Board to refuse the application for the issue of a retail beer licence in respect of the appellant’s premises which is next to the Honiara Main Market. This was also an application for the issue of a retail beer licence for the first time in the said premises and it is all the more reason for the Board to exercise its discretion against its issuance on this basis that such a business is not appropriate in the immediate vicinity of the Honiara Main Market.

Then there is the complaint that the Board based its decision solely on its own objection. That being the case section 25(2) obliges the Board to inform the applicant so that he could seek an adjournment of the hearing to enable him to make a reply. The suggestion is that the Board did not inform the appellant of the Board’s objection. There is very little on the record to support that contention. There is, however, indication on the record that the applicant was informed of the Board’s own objection to grant the application on the basis that the applicant’s premises being near the market premises. Also at the hearing the applicant was given the opportunity to be heard and he was heard before the decision was made. On the record I accept that the applicant was advised of the Board’s objection under section 25(1) and that the applicant was given the opportunity to be heard and he was before the decision was made. On the record I accept that the applicant was advised of the Board’s objection under 25(1) and that the applicant was given the opportunity to be heard and was in fact heard before the Board made its decision. He failed to request an adjournment as required by subsection (2). He was entitled to an adjournment upon request, if he so requested it. See Dennis Kwan -v- Honiara Liquor Licensing Board, CC81/97 (Judgment 13/1/98). No such request had been made and the applicant cannot now raise it much sympathy at all from the Court. The suggestion by the appellant through his Counsel that the Board did not properly determine his application but simply brushed it aside is clearly unsupported.

As to the Health Inspector’s Report, Counsel for the appellant submitted that the said report was not fatal to the appellant’s application. I agree. The Board however took into account that Report together with its objection pursuant to section 25(1) of the Act. The main reason for the refusal of the application was that the premises was too close to the Honiara main Market, a decision which I have no reason to disagree with.

Counsel for the appellant raised the point that it is note worthy that there was no Police Report adverse to the appellant here. I feel it is also noteworthy that despite the request by the respondent to the police for report in a memo of 16 March 1998, no report had been made, at least not that I can see from the file. That is not the respondent’s fault. But in my view the lack of report from the police does not assist the appellant at all.

A point had been made by the appellant regarding the Board’s approval previously given to one Colin Leong in 1996 and renewed in 1997 for a liquor licence in respect of a premises nearer to the main market than that of the appellant in this case. This, argued the appellant, was affording unequal treatment to his application. The chronology of events submitted by the respondent shows that both the appellant, in respect of his existing premises opposite the Guadalcanal Province and Mr. Leong, in respect of his premises near the main Market, have their retail beer licences renewed to 31 December 1998 by the former Board. The present Board which came into effect in January 1998 decided as a matter of policy that there would be no new licence granted to applicants in respect of premises near the market place. Mr. Leong did not seek a new retail beer licence in respect of any premises near the market and in the light of the new Board’s policy, it would be highly unlikely that it would grant him any new licence if he had applied to the new Board for one. In any event, the appellant’s application was for a licence to sell beer on premises not before licensed and it is certainly within the discretion of the Board to refuse it on the basis that the locality in which the premises is situated is best served without such a licence or none was needed in addition to the one already issued. I do not see anything wrong in the treatment given by the Board to the appellant’s application in this regard,

Counsel for the appellant also raised the point that this Court was not correct in Kwan -v- Honiara Liquor Licensing Board where it said that it was not for the Court to question the policy of the Board. With respect, I feel Counsel had misconstrued what His Lordship, Awich J. had said in that case. His Lordship said at page 4 of his judgment:

“The Board decided that it would effect the policy by refusing to renew one of the Appellant’s licences on the ground that he already had a licence for another premises in the same location, renewed. It is not for the Court to decide upon the logic of policy or the best way to carry out a policy. It is not a question of law or jurisdiction.”

The Board’s policy referred to by His Lordship was the policy of reducing the number of liquor outlets in the Kukum Shopping Centre. The comment by His Lordship that “It is not for the Court to decide upon the logic of policy or the best way to carry out a policy” was in response to the suggestion by the appellant in that case that the Board’s policy of reducing liquor outlets in Kukum could be effected by allowing renewals of existing licences but eliminating all new applications. It was the question of effecting that policy that His Lordship felt that it be best left to the Board and not the Court. I do not think it is correct to say that His Lordship was there saying that the Court could not question the Board’s policy. The Court retains its inherent jurisdiction of seeing that tribunals which exercise quasi-judicial functions must act according to law. If by reasons of its policy, a tribunal deprives a person, say, of the rule of natural justice, the Court must act so as not to allow such policy to interfere with the rights of such a person. But it is totally another thing to tell the Board or the Authority how to implement its policy. Whether logically or illogically, the question of effecting the Board’s policy is a matter entirely for the Board. There is no merit on the point raised by the appellant in this regard.

There is also the suggestion that the appellant was in effect seeking approval to transfer his retail beer licence from his existing premises to the new premises near the market. I do not think that it would make any difference to the Board’s policy of discouraging the issue of new liquor licences on the new premises near the market. The objections pursuant to sections 23 and 25 of the Act would apply, whether it be an application for transfer of licence to the new premises or application for new licence on the new premises. The fact is that the new premises is near the market place and the Board’s policy is not to issue liquor licences in respect of such premises. I do not see how any right-thinking person can say that the Board’s policy of not issuing liquor licences in respect of premises close to places like the Honiara Market is unreasonable.

Having considered all the grounds raised and argument advanced on behalf of the parties, for and against the appeal, I come to the conclusion that all the grounds in support of the appeal fail. The Board’s decision is confirmed with the result that this appeal is dismissed with costs to be paid to the Board by the appellant.

ORDER OF THE COURT:

1. Appeal Dismissed

2. Costs to the Respondent

(Sir John Muria)
CHIEF JUSTICE