COMMISSIONER OF POLICE AND ANOTHER v. MUNICIPAL SERVICES APPEALS BOARD AND OTHERS

HCAL 22/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO.22 OF 2004

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J U D G M E N T

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Hon Hartmann J (giving the judgment of the Court) :

1. This application for judicial review looks to the powers of the licensing authority established in terms of s.3B of the Places of Public Entertainment Ordinance, Cap.172 (‘the Ordinance’).  The Ordinance provides for the licensing of any place where ‘public entertainment’ is to be staged.  ‘Public entertainment’ is defined in s.2 of the Ordinance and means “any entertainment within the meaning of this Ordinance to which the general public is admitted with or without payment”.  As for the concept of ‘entertainment’, it too is defined in s.2 of the Ordinance and is stated to include “any event, activity or other thing specified in Schedule 1”.

2. Schedule 1 of the Ordinance lists nine categories of entertainment which include such events as concerts, film shows, circuses, sporting events and an event of apparently recent origin described as ‘a dance party’.  This last event was added to Schedule 1 in 2002.

3. The decision challenged in this application is a decision of the Municipal Services Appeal Board (‘the Board’) made in respect of an appeal from the licensing authority.  The decision is contained in a ruling of the Board dated 3 November 2003 (‘the ruling’).  In that ruling, the Board found that, on a true construction of the Ordinance, when exercising its discretion to determine whether a licence should be issued, the licensing authority should have regard only to matters of ‘public order and safety’.  The licensing authority is not therefore entitled in the exercise of its discretion to look to broader aspects of the maintenance of law and order nor is it entitled to take into account matters concerning the public interest which are independent of ‘public order and safety’.

4. The applicants contend that this is too confined an interpretation of the legislative intention expressed in the language of the Ordinance and is wrong in law.

5. The ruling of the Board arose out of the following history.

6. In December 2002, an application was made to the licensing authority for a licence to keep or use a premises in Nathan Road, Kowloon, as a place of public entertainment.  The type of entertainment to be licensed fell under the description of ‘a dance party’.

7. A dance party is defined in Schedule 1 of the Ordinance as any event with all of the following attributes—

“	(a)	music or rhythmic sound of any kind or source is provided at the event;
	(b)	the primary activity at the event is dancing by the persons attending the event;
	(c)	either—
		(i)	the number of persons attending the event exceeds 200 on at least one occasion during the event; or
		(ii)	any part of the event occurs between 2 a.m. and 6 a.m.”

8. At the time the application was made, the premises to be licensed had been operating for two years as a discotheque under the name of the 348 Disco and Karaoke.

9. The licensing authority, in the exercise of its discretion, did not reject the application on the basis that, on its face, it should not be granted.  That being so, as it was obliged to do in terms of r.162(2) of the Places of Public Entertainment Regulations, the licensing authority referred the application for consideration to the Commissioner of Police, the Director of Fire Services and the Building Authority.

10. The Commissioner of Police objected to the issue of the licence.  He did so on the basis that the 348 Disco and Karaoke, which would incorporate dance party activities into its entertainment operations if the licence was issued, had been the subject of unfavourable police attention.

11. The licensing authority was persuaded by the Commissioner’s objection not to issue the licence.  In its letter of refusal dated 25 March 2003, the licensing authority recorded that the Commissioner had drawn its attention to the following matters :

(i)  The Police had detected “persistent dangerous drugs activities” carried out in the premises.  In 2002, a total of 172 persons had been arrested for drug offences, a wide variety of dangerous drugs being seized.

(ii)  During the period between August 2002 and January 2003, there had been a total of 34 nuisance or hoax calls made to the police alleging fighting or assaults taking place within the premises.

(iii)  In 2002, there had been four prosecutions instituted against the operator of the premises in 2002 for overcrowding, thereby contravening the applicable liquor licence.

(iv)  There had been two incidents of selling without a liquor licence.

12. The Board was particularly disturbed by the report of persistent criminal activity in respect of dangerous drugs.  In its letter, it concluded by saying :

“ After considering the police information provided concerning the persistent dangerous drugs activities detected during the year 2002, to be read in conjunction with the other Police’s observations made, we find that it is undesirable from the law and order perspective to issue a PPE licence to your client …”  [our emphasis]

13. The refusal was appealed to the Board.  On behalf of the appellant, it was submitted that, on a true construction of the Ordinance, when considering whether or not to grant a licence, the licensing authority was permitted only to take into account matters relating to ‘public order and safety’.  Matters appertaining to the public interest or to the general maintenance of law and order were not relevant unless it could be demonstrated on the facts of each case that they were issues of ‘public order and safety’.

14. The Board accepted that submission, concluding that the provisions of the Ordinance (and the regulations made under it) were concerned only with those matters; that is, with matters relating to ‘public order and safety’.

15. Having regard to the factual context of the application for the issue of the licence, the Board went on to hold that the licensing authority had been wrong therefore to take into account matters relating to :

“	(a)	drugs abuse;
	(b)	complaints about (as opposed to actual incidents of) nuisance, fighting and/or assault.”

16. The Board did not define what it meant by ‘public order and safety’.  With respect to the Board, on its face, it is an imprecise phrase, elusive of a clear meaning.  It would appear, however, on a consideration of the ruling as a whole, that the phrase ‘public order’ and the word ‘safety’ are not to be read disjunctively, that is, as distinct concepts.  They are rather to be read conjunctively, that is, the one being understood in light of the other.

17. Accordingly, as we understand it, the concept of ‘public order’ may include such matters as over-crowding, riot, arson, gang fights and the like which will by their nature jeopardise the orderly conduct of the mass of people at an event and put their safety at risk.  However, matters, for example, relating to drug trafficking, illegal gambling and the like which, in the factual circumstances of a case, may present no demonstrable risk to the generally orderly conduct of the mass of people or put their safety at risk will not be relevant to matters of ‘public order and safety’.

18. It would appear that it was in light of this interpretation of the phrase, that the Board found that the licensing authority had been wrong to take into account matters concerning drug abuse and nuisance calls to the police.

19. As the applicants have complained, this is a highly restrictive interpretation of the discretionary powers given to the licensing authority in terms of the Ordinance.

20. In practice, it will mean that the licensing authority has no power to take into account any form of criminal conduct — no matter how flagrant, serious or insidious — that is reasonably anticipated will take place if the premises are licensed unless it is demonstrated that it will affect the orderly conduct of persons who pay to go to the premises or will put their safety at risk.  In practice, it will also mean that broader issues, such as nuisance caused to others, this being a matter essentially of public interest, may not be taken into account.

21. We accept that, on a reading of the Ordinance and in the context of other relevant legislation, the licensing authority, in exercising its statutory functions, does not act as a board of censorship.  There is nothing to suggest that the licensing authority has the power to refuse a licence because it objects to the content of the public entertainment that is sought to be staged.  In this regard, so far as it may be necessary to cite it, the speech of the then Secretary For Recreation And Culture (made when moving the second reading of the bill on 3 May 1995), was to the following effect :

“ The proposed removal of the permit system is part of the Government’s continued efforts to give effect to its commitment to promote freedom of expression.  The abolition of the permit system will also simplify the existing dual licensing system for public entertainment by making the Urban Council and the Regional Council the sole licensing authorities.  In future, an organizer of a public entertainment will only need to obtain one licence from the licensing authority to comply with hygiene, fire and building safety requirements for the venue.  These requirements are mainly to ensure the safety of participants.

Mr President, I would like to emphasize that the removal of the permit system does not mean that we will lose control over live public performances.  Objectionable public performances will continue to be controlled by section 12A of the Summary Offences Ordinance, under which it is an offence to take part in, provide or manage any public performance of an indecent, obscene, revolting or offensive nature.”

22. In our view, however, while the licensing authority may have no power to impose moral values on the content of the entertainment that is sought to be staged and while, as a matter of primary concern, it is no doubt required to have regard to issues of crowd control and safety, it goes too far to say that the Ordinance permits no other matters to be considered.

23. The legislature has not seen fit to use direct language to fetter the discretionary power of the licensing authority.  As such, in our view, there being no express statutory limitation upon the licensing authority’s exercise of discretion, in the absence of any clear implication in the language of the Ordinance to the contrary, the licensing authority is not restricted to the matters that it may take into consideration provided of course that they are relevant and are therefore matters which a reasonable licensing authority could take into account.

24. Certainly, the mischief which it must be inferred the legislature intended to avoid when it added dance parties to Schedule 1 of the Ordinance in 2002 goes further than a mischief threatening only the orderly conduct of patrons or their safety.  When the Executive sought to have dance parties added to Schedule 1 and placed the matter before the legislature, it identified the mischief which it sought to combat in a Legislative Council brief :

“ In Europe and the USA, rave music and dance parties have been associated with abuse of alcohol and psychotropic drugs.  In Hong Kong, although alcohol abuse is not a major part of rave party culture, drugs abuse, law and order problems and noise nuisance at rave parties have within past attracted much media and public concern.  For example, some party goers were found using psychotropic drugs for their euphoric effect and to enhance the sensation provided by the music played at the parties.  There have also been a number of violent crimes committed at rave venues, involving multiple assailants.  Besides, noise nuisance can be generated by party goers congregating outside the venue and leaving the venue, as well as by the amplified music of the event itself.

…

It is not uncommon that some dance parties held in bars and discotheques are associated with abuse of psychotropic drugs and have given rise to both public order and public safety concerns.”  [our emphasis]

25. Counsel for the applicants referred us to the Legislative Council brief not as an aid to construction of the language in the Ordinance under the rule in Pepper v. Hart [1993] AC 593 but only to identify the mischief which, it must be inferred, led to the inclusion of dance parties in Schedule 1.  This is a permissible reference : see R v. A (No.2) [2002] 1 AC 45 at 59D and 99C.  See also Director of Lands v. Yin Shuen Enterprises Ltd & Another [2003] 2 HKLRD 399, at 411 per Lord Millett NPJ :

“Such evidence is admissible for a limited purpose only, to enable the Court to understand the factual context in which the statute was enacted and the mischief at which it was aimed.  This is not the same as treating the statements of the executive about the meaning and effect of the statutory language as reflecting the will of the legislature.”

26. In our view, it is plain from a reading of the Legislative Council brief that licensing of dance parties was considered necessary to combat the ‘law and order problems’ and ‘noise nuisance’ that often accompanied these events.  This, of course, implies that, to combat the mischief, the legislature believed the licensing authority had the power in terms of the Ordinance to take into account such matters as ‘law and order problems’ and ‘noise nuisance’.  That belief, we are satisfied, was accurate.

27. On a reading of the Ordinance, we are satisfied that the discretionary powers given to the licensing authority, while they must be exercised in accordance with the policy and objects of the Ordinance, are otherwise unfettered.

28. The licensing authority is established in terms of s.3B of the Ordinance.  That section neither imposes nor implies any specific restrictions on the licensing authority, other than the inability to make regulations and other than any restrictions on its powers contained elsewhere in the Ordinance.  The section reads :

“The Secretary for Home Affairs may authorize in writing any public officer to issue or cancel any licence or exercise any other function relating to licensing matters (other than the regulation making power under section 7) under this Ordinance.”

29. S.7 of the Ordinance gives the power to the Secretary for Home Affairs, in the exercise of his discretion, to make regulations in order to provide for—

“	(a)	the kinds of entertainment for which places of public entertainment may be licensed for the purposes of this Ordinance;
	(aa)	a licensing authority by which such licences or any class or description of such licences may be granted;
	(ab)	the mode of application for such licences and the class or description of persons to whom such licences may be granted’
	(ac)	the circumstances in which conditions specified in such licences may be cancelled, waived or vaired or conditions substituted therefor or in which further such conditions may be added;
	(ad)	the circumstances in which fees payable as regards licences for the purposes of this Ordinance may be waived or reduced;
	(ae)	the transfer of such licences;
	(b)	the cancellation of any such licence.
		…”

30. We find nothing in those provisions, or those that follow in the section, which, in giving power to the Secretary for Home Affairs to make regulations, states or implies that such regulations must limit the exercise of discretion by the licensing authority in the discharge of its statutory obligations.

31. During the course of the hearing, Mr Plowman SC, leading counsel for the respondents, placed emphasis on s.7(1)(f) of the Ordinance and the restricted meaning given to it by s.7(3), suggesting that here was clear evidence of the legislative intent to restrict the licensing authority to considering matters of ‘public order and safety’.

32. In terms of s.7(1)(f), the Secretary for Home Affairs may also provide by way of regulation for—

“the maintenance of peace and good order in a place of public entertainment.”

The meaning of the phrase ‘the maintenance of peace and good order’ is later defined in the same section.  S.7(3) reads :

“The general purpose of regulations under subsection (1)(f) shall be to—

(a)  ensure the safety of any persons present in a place of public entertainment should a fire or other emergency occur in that place; and

(b)  avoid disorder in such a place.”  [our emphasis]

33. S.7(3) was inserted (as an amendment to the bill) so as to restrict the very broad meaning that could otherwise be given to the phrase ‘the maintenance of peace and good order’.  In this regard, in a speech made to move the amendment on 19 July 1995, the Secretary For Recreation And Culture said that its purpose was to limit the ‘general purpose’ of s.7(1)(f) to—

“ … ensuring the safety of any persons present in a place of public entertainment should a fire or other emergency occur in that place, and to avoiding disorder in such a place.  This is to address concern expressed in certain quarters that the wording of section 7(1)(f) might be broader than our stated policy intention, which is to prevent disorder and to protect public safety in the course of a public entertainment.”  [our emphasis]

34. The meaning of the word ‘disorder’ as it appears in s.7(3)(b) is in our view of central importance to ascertaining the legislative intention.  We do not read the word ‘disorder’ to be restricted only to matters of orderly conduct (i.e. crowd control) and general safety.  In our view, the word is to be given its plain English meaning.  The Shorter Oxford English Dictionary (5^th Ed.) includes in its definition of ‘disorder’ the violation of moral order or rule as well as behaviour of a riotous or unrestrained kind.  It is pertinent, in our view, to also have regard to the definition ‘disorderly’ which is defined as : ‘opposed to or violating public order or morality or constitutional authority, esp unruly, turbulent, riotous’.  In our judgment therefore behaviour which violates the law, such as drug trafficking, or which is of a riotous nature, such as behaviour which causes a nuisance to others, is behaviour falling under the definition of ‘disorder’.

35. We are also assisted by the authority of Clear v. Cunon (unreported) 10 June 1993 QBD, in which Glidewell LJ said the following :

“para.1(4) of Sch 1 of the 1982 Act provides that:

‘The appropriate authority may grant to any applicant a licence for the use of any place specified in it for all or any of the entertainments … on such terms and conditions and subject to such restrictions as may be so specified.’

Of course, that must be subject to the normal principle that the licensing authority (in this case the Borough Council) must not use its powers to impose conditions or restrictions for purposes totally alien to the objects of the legislation.

But it is quite clear that the control of public order is a major object of this legislation.  A major purpose of the licensing of public entertainment is the control of public order as well as of the furthering of public morality.  It cannot be argued — and I do not think Mr Walters was seeking to argue — that the imposition of conditions which were intended by the court to assist the police in restricting public disorder was outside the general sphere of the Act.”

36. S.10(1) of the Ordinance allows for licences to be made subject to conditions :

“ A licence for the purposes of this Ordinance shall be in such terms as the licensing authority by which it is granted determines and … such licence shall be subject to such conditions (if any) as are specified in the licence.”

If the licensing authority has an unfettered discretion to apply such conditions as it thinks fit, it must follow, we think, that the legislature intended that it should have a similar unfettered discretion in considering what matters are relevant in respect of the applications themselves.  For example, if the licensing authority may impose a condition as to the time when a place of public entertainment must be operated, a condition contemplated in s.10(2)(b), it must follow that it can take into account, in considering the application itself, whether the granting of a licence may cause a nuisance and whether, in the public interest, it should therefore be refused or allowed but made subject to conditions which will minimize such nuisance.

37. The manner in which applications for licences (for such events as dance parties) are to be made are governed by the regulations made under the Ordinance.  In terms of r.162(2), the licensing authority is given the discretionary power to reject an application on the papers only.  This discretion is not expressly restricted.

38. If it does not reject the application, the licensing authority is obliged to forward copies of the application papers to a number of public departments.  In the present case, the papers were sent to the Commissioner of Police, the Director of Fire Services and the Building Authority.  If no objection is received from any of the recipients, the licensing authority may, if it thinks fit, grant the licence.  In this regard, r.162(8) reads :

“ … where an application is made under paragraph (1), the licensing authority may, where it thinks fit and on being notified by each of the Commissioner of Police, the Director of Fire Services … [and] the Building Authority … that has no objection as regards the application, grant the licence sought under the application.”

Again, the discretion is not expressly restricted.

39. In our judgment, the Board was correct to direct itself that, as the legislation does not state in express terms or by clear implication what the licensing authority may or may not take into account in discharging its statutory obligations, it is therefore necessary to look to the legislative intent behind the legislation.  But, as the Board itself recognised, legislative intent is a ‘very slippery phrase’.  Primarily, legislative intent is to be ascertained from the text of the legislation itself.  From a study of the text, we are satisfied that, while clearly in respect of places of public entertainment, the legislature intended that importance be given to matters of crowd control and safety, it did not intend to restrict the licensing authority, in the exercise of its discretion, to a consideration of those matters only.  On a reading of the text, we fail to see that any legislative importance placed on matters of crowd control and safety acts to prevent the licensing authority from considering other matters of legitimate concern.

40. For the reasons given, we have concluded therefore that the Board was wrong in law in restricting the licensing authority’s powers of discretion to matters which it defined as matters of ‘public order and safety’.

41. In the circumstances, the decision of the Board must be set aside and there will be an order of certiorari to this effect.

42. The decision of the Board, however, went to two issues; first, the matter of law in respect of which we have found that the Board erred and, second, whether on the factual evidence a licence should or should not have been granted by the licensing authority and, if granted, upon what terms and conditions.  In respect of this second issue, we are not confident that we can dispose of it and are of the opinion that the matter should be remitted to the Board so that it can make its determination in accordance with the law as we have stated it to be.

43. In respect of costs, there will be an order nisi awarding costs to the applicants, that order to be made final 30 days after the handing down of this judgment unless an application is made prior to that date for a different order as to costs.