SIANO, CLARE PODSOK v. LIQUOR LICENSING BOARD

HCAL 97/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO 97 OF 2012

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REASONS FOR JUDGMENT

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1. This is the applicant’s application for leave to apply for judicial review and an interim relief pending judicial review.

2. At the end of the hearing, I refused the application with costs.  These are my reasons.

A.  BRIEF BACKGROUND

3. The applicant was granted a liquor licence on 5 July 2011 for the operation of a bar at Wan Chai.  The licence was to expire on 24 July 2012.

4. On 27 April 2012, the applicant applied to renew the liquor licence.

5. The Liquor Licensing Board (“the LLB”) held a hearing for the newel application on 17 July 2012, where the applicant attended.  After the hearing, the LLB decided to renew the licence, but subject it to 4 new conditions (“the New Conditions”).  The New Conditions effectively relate to noise control of the bar from late night to early morning.  They also require the applicant to be personally present at the bar between 11 pm and 7 am on designated days of a week.

6. On 21 July 2012, the applicant filed an appeal (“the Appeal”) to the Municipal Services Appeal Board (“the Appeal Board”) against the decision (“the Decision”) of the LLB to impose the New Conditions on the renewed licence.  No hearing date of the Appeal has been fixed yet.

7. However, notwithstanding the Appeal, on 24 July 2012 (ie, two days after lodging the Appeal), the applicant applied ex parte in the High Court for leave to apply for judicial review against the Decision.  She also sought in the application an interim relief to stay the imposition of two of the New Conditions until the determination of the judicial review, or the Appeal, or further order of the court.

8. Macrae J directed that there be an inter partes hearing of the application for leave and interim relief.

9. This was the inter partes hearing.  The LLB (as putative respondent) appeared through counsel, opposing the application.

B.  THE APPLICATION

B1.  Alternative remedy

10. It is trite that, unless exceptional circumstances are shown, the court in general would not grant relief by way of judicial view if there exists an alternative remedy[1].

11. In the present case, an appeal to the Appeal Board is an alternative remedy to challenge the Decision, which the applicant has in fact invoked (ie, the Appeal).  Thus, in raising his primary objection to the application, Mr Suen for LLB says unless exceptional circumstances are shown by the applicant, the leave application clearly has no merits[2] and must be refused.  The application for interim relief should similarly be rejected.

12. In response, the applicant’s only ground of exceptional circumstance is his submissions that the Appeal Board has no authority to grant an interim stay of the relevant New Conditions.  It is thus necessary for the applicant to apply for leave to commence judicial review to support an application for interim stay.

13. The fundamental question that falls to be decided under this primary objection is therefore whether the Appeal Board has a discretion to grant an interim stay pending the Appeal.

14. The issue arises in the following way.

15. Under Regulation 17(5) of the Dutiable Commodities (Liquor) Regulations, Cap 109 (“the Regulations”), an applicant for liquor licence may appeal to the Appeal Board against the decision made by the LLB in relation to the grant (or refusal) of a liquor licence.  This regulation provides as follows:

“17. Decisions of Board and appeals to

Municipal Services Appeals Board

(1) Upon application the Board may grant a liquor licence without conditions or subject to such conditions as it thinks fit, or refuse the application.

(2) The Board shall not grant a liquor licence unless it is satisfied-

(a) that the applicant is a fit and proper person to hold the licence;

(b) that the premises to which the application relates are suitable for selling or supplying intoxicating liquor, having regard to-

(i) the location and structure of the premises; and

(ii) the fire safety and hygienic conditions in the premises;

(c) that in all the circumstances the grant of the licence is not contrary to the public interest.

(3) The Board must give reasons in writing-

(a) for any decision on an application in respect of which there is an objection; or

(b) for any decision to refuse an application.

(4) The secretary to the Board appointed under regulation 2A(5) must give notice in writing of the Board's decision, together with reasons, to the applicant and any other person who or body which has expressed an interest in the application.

(5) The applicant or 20 or more persons residing within a radius of 400 metres from the premises to which the application relates may, within 28 days after the date of the notice under paragraph (4), appeal to the Municipal Services Appeals Board the Appeal Board against the decision.”

16. For the purposes of such an appeal, under 7(1)(a) of the Municipal Services Appeals Board Ordinance, Cap 220 (“MSABO”), the Appeal Board may exercise all powers and discretions that are conferred on the person who made the administrative decision or the first decision (ie, the LLB in the present case), and shall “affirm, vary or set aside” the subject matter decision, and (if the appealed decision is set aside) substitute its own decision.  It provides as follows:

“7. Powers of Board in respect of appeal

(1) In determining an appeal against an administrative decision or an appeal board decision, the Board-

(a) may exercise all the powers and discretions that are conferred on the person who made the administrative decision or the first decision, as the case may require;

(b) shall affirm, vary or set aside the administrative decision or the appeal board decision and, where it sets aside the administrative decision or the appeal board decision, it shall substitute its own decision.

...”

17. It is clear that s 7(1) of the MSABO does not expressly provide a power or discretion to the Appeal Board to stay the operation of a decision from which an appeal has been lodged.

18. The question is thus whether such a discretion should be implied to it as a matter of law.

19. It is not disputed that the principles governing whether such a discretionary power should be implied have been laid down by the Court of Final Appeal in PCCW-HKT Telephone Ltd v Telecommunication Authority[3].

20. In PCCW-HKT, the statutory appeal body concerned is the Telecommunications (Competition Provisions) Appeal Board created under the Telecommunications Ordinance (Cap 106), and the relevant provision concerned is s 32 O(4), which provides as follows:

“ (4) After hearing an appeal, the Appeal Board shall determine the appeal by upholding, varying or quashing the appeal subject matter and may make such consequential orders as may be necessary.”

21. After coming to the conclusion that the Telecommunications Ordinance does not expressly prohibit any implication of a power to grant a stay by that appeal body, the Court of Final Appeal went on to hold that such an ancillary power should be implied under s 32 O(4)[4].  The CFA also set out the principles as to when such an implication should arise in law[5]. In gist, the law would imply such a discretionary power to grant a stay in relation to an appeal body set up by a statute if:

(1)  The enabling statute does not expressly prohibit such a power for the body, and

(2)  That power is reasonably required for that body’s effective exercise of the statutory appellate jurisdiction expressly conferred on it. 

22. In the present case, the Appeal Board has been conferred a jurisdiction to determine an appeal by affirming, varying or setting aside the subject matter decision under appeal. 

23. Applying the principles in PCCW-HKT to the present case,subject to there being a provision in the enabling statue expressly prohibiting it, I am of the clear view that a discretionary power to grant a interim stay is reasonably required for the Appeal Board’s effective exercise of its power to determine an appeal.  This is because[6]:

(1)  The powers conferred to the Appeal Board by s 7(1) of the MSABO enable it to mount a full review on merits of the relevant decision under appeal.

(2)  It is thus obvious that a suspension of the relevant decision or order may in some cases be essential if the Appeal Board’s powers for disposing of the appeal are effectively to be exercised upon determining the appeal.  There can accordingly be no doubt that it is reasonably necessary to imply such a power to enable the Appeal Board effectively to carry out its statutory appellate function.

24. Bohkary PJ also further explains in PCCW-HKT why such an implication is reasonably necessary for the appeal body to exercise its appeal functions, instead of leaving the consideration of whether to grant a stay to the courts by way of a judicial review application:

“49. Judicial review of a refusal by the Authority to suspend under s 46 of the Interpretation and General Clauses Ordinance would not fulfill the function of a discretion in the Appeal Board to suspend pending appeal. The Ordinance provides for a full merits appeal to the Appeal Board. It would be cumbersome and less efficient for suspension pending appeal to be decided by a body other than the one which will hear the appeal. It is the appellate tribunal itself that would be best placed: to take a view of the appeal’s prospect of success; to balance all relevant considerations for and against suspension pending appeal; and to work out any terms on which such suspension is to be ordered.”

25. I also respectfully adopt in the present analysis these learned observations by Bokhary PJ. 

26. However, Mr Ross for the applicant submits that there are provisions elsewhere which, properly read, would be inconsistent with and thus expressly prohibit such an implication of discretionary power to the Appeal Board to grant a stay. 

27. Counsel’s submissions run as follows:

(1)  The Appeal Board is conferred with the powers to hear appeals from decisions made by various administrative bodies as provided by the specific ordinances respectively governing those administrative bodies.  The LLB is one of these boards as governed by the Regulations.

(2)  However, there are various ordinances[7], while on the one hand provide that an appeal against a decision made by the relevant body lies to the Appeal Board, they also provide on the other hand that such an appeal does not operate to automatically stay the decision under appeal, unless the director (who makes the decision) decides otherwise.

(3)  These provisions, in expressly providing that there are no automatic stay of the appealed decisions, are (submitted Mr Ross) inconsistent with an implication of a discretionary power to the Appeal Board to grant a stay.

28. I am unable to accept these submissions. 

29. In PCCW-HKT, there was an express provision in the enabling ordinance (ie, the Telecommunications Ordinance) which provided that “an appeal shall not suspend the operation of the appeal subject matter”. After referring to it, Ribeiro J rejected that such a provision can be read to be prohibiting the implication to the subject appeal body a discretionary power to stay the operation of the relevant appealed decision.  His Lordship explained at paragraphs 56 to 59 as follows:

“56. Lodging notice of an appeal is the act of the appellant and not of the Board and any s 36C penalty attached to the matter appealed against is suspended ‘from the day on which the appeal is made’ until the appeal is disposed of. The suspension is automatic and there is no need for anyone, in particular, no need for the Board, to order a stay or suspension of the penalty in question.

57. So, when s 32N(2) says that except for cases coming within s 32N(3), ‘an appeal shall not suspend the operation of the appeal subject matter’, it is concerned only with automatic suspension, making it clear that with the exception of s 36C penalty cases, no such automatic suspension occurs simply by reason of the lodging of an appeal.

58. Such a rule is not unusual. Rules of the High Court (Cap 4, Sub Leg) O 59 r 13(1)(a), for instance, is to like effect, stating:

Except so far as the court below or the Court of Appeal or a single judge may otherwise direct, an appeal shall not operate as a stay of execution or of proceedings under the decision of the court below.

59.  Accordingly, on its true construction, s 32N(2) does not address and so does not exclude the power to grant a discretionary stay.”

30. In my views, these reasons apply equally, if not with greater force,[8] in the present debate. 

31. Further, Bokhary PJ in PCCW-HKT has alsosaid[9] that it was precisely because there was no automatic stay of the appealed decision by reason of the appeal, that it was necessary for the court to consider whether a discretion to do so should be implied by law to the appeal body in the absence of an express power to do so.

32. In the premises, I see no merits Mr Ross’ above submissions and reject them. 

33. In his written submissions, Mr Ross also suggests that the decision of Appeal Board in Lai Ming Yan v Liquor Licensing Board[10] supports the contention that it has no implied discretionary power to stay the operation of a decision under appeal. 

34. Although Mr Ross did not press ahead with this argument at the hearing, to avoid any doubts and for completeness, I would look at this decision briefly as follow.  

35. As far as I can see, Lai Ming Yan does not deal with the question as to whether the Appeal Board in general has an implied discretionary power to grant a stay of an appealed decision.  

36. In Lai Ming Yan, the applicant’s application for renewal of the liquor licence was refused by the LLB.  The applicant thus lodged an appeal against the non-renewal to the Appeal Board.  In the meantime, the old liquor licence had expired by effluxion of time.  The applicant then applied to the Appeal Board seeking an interim renewal of the liquor licence pending appeal.

37. Relying on PCCW-HKT, one of the submissions made by the applicant in Lai Ming Yan was that a power of the Appeal Board to grant an interim renewal of the licence pending appeal can be implied  The Appeal Board rejected these submissions, and said at paragraphs 29 to 31 of the decision as follows:

“29. We cannot accept Mr Halkes’ submission that PCCW-HKT is the authority in support of his contention that where an appeal is lodged against a decision made by an inferior tribunal, the appeal board must have an implied power to grant an interim order pending appeal. As the Court of Final Appeal made clear in PCCW-HKT (at §46), whether a power to suspend pending appeal is to be implied must depend on the entire context of each situation.

30. Further, there is another important point of distinction between PCCW-HKT case and the present application. In PCCW-HKT, the implied power under consideration is a discretionary power to grant a suspension of the direction or order made by the Authority pending appeal, which is ‘a matter of practice or procedure’ (see §34). By contrast, in the present application, the Appellant is seeking a substantive order, in the form of a new liquor licence which lasts until the determination of her appeal. Although the Appellant describes her application as an application for an interim liquor licence, it is in effect an application for a new liquor licence as the Appellant has since 25 May 2012 ceased to be a holder of liquor licence.

31.  We therefore do not consider PCCW-HKT to be the authority in support of the Appellant’s contention that there is an implied power under s 7(1)(a) of MSABO for the Appeals Board to grant an interim liquor licence pending determination of the Appellant’s appeal.”

38. In reaching the above conclusion, I see nothing in the Appeal Board’s reasoning which even remotely suggests that it did not have an implied power to grant an interim stay of the operation of the appealed decision.  Quite to the contrary, the Appeal Board in that decision appears to have accepted that such a discretionary power could be implied to it as a matter of “practice and procedure” under the PCCW-HKT principles.

39. Mr Ross’ reliance on this decision to support the applicant’s present application is without basis.

40. For the above reasons, I conclude that, as a matter of legal implication, the Appeal Board has a discretionary power to grant an interim stay of the relevant decision against which an appeal has been made.   

41. In the premises, an alternative remedy exists by way of the Appeal in the present case, and the applicant also cannot show any special circumstances to justify the granting of relief in the proposed judicial review. 

42. The proposed judicial review therefore does not have any reasonably arguable chance of success, and I refuse the leave application.

B2.  Merits of the underlying grounds of the proposed judicial review

43. Moreover, given my above basis in refusing leave, and that the Appeal against the Decision is still ongoing, I do not find it appropriate at this stage to further comment on the merits, if any, of the underlying grounds (principally on Wednesbury unreasonableness) made in support of the proposed judicial review against the Decision.

C.  CONCLUSION

44. Leave to apply for judicial review is refused, and the application for an interim stay of the relevant parts of the New Conditions must also therefore fail.