New Laws On POPE Licences, Issues Relating To Smoking Areas, Development Applications For Extended Hours And Increased Patron Number

Under proposed new legislation (the Environmental Planning Legislation Amendment Bill 2006), the requirement to obtain a Place of Public Entertainment Licence (POPE Licences) under the Local Government Act 1993 will be abolished. In its place, the Environmental Planning & Assessment Act 1979 (the Act) will regulate places of public entertainment. To this end, premises will need to obtain development consents under the Act to enable the premises to be used as places of public entertainment. The Act will also prescribe conditions of development consents that will apply to all places of public entertainment. Concurrent amendments will be made to the Liquor Act 1982 so as to only allow a night club licence to be granted if a development consent is in force under the Act for the use of the premises as a place of public entertainment.

The proposed legislation contains savings and transitional provisions relating to existing POPE Licences and applications for POPE Licences that have been made but not determined at the time of the commencement of the legislation. In summary, conditions of existing POPE Licences continue to apply for a period of two years as if they were contained as regulations under the Act and existing applications are to be determined under the existing unamended Act (as if the legislations had not been enacted). The legislation also proposes to amend the existing use rights provisions so as to make premises that have existing use rights (for the purpose of a POPE) subject to conditions that need to be complied with, so as to enable the use of a building as a place of public entertainment to be continued. Finally, any orders issued by councils seeking to regulate places of public entertainment that are issued prior to the legislation coming into force continue to apply as if the legislation had not been enacted.

Accordingly, if this legislation does commence, premises will be required to comply with the proposed prescribed conditions regulating the use of places of public entertainment that are to be contained within the Act and associated regulations and, depending on the final form of the legislation, may also need to apply for new development applications to expressly authorise the use. These conditions are likely to relate to the management and security procedures that are employed by premises.

Since January 2005, there has been a gradual phasing out of smoking in indoor areas of licensed venues in NSW. This process has been causing some problems for licensed premises where space is limited or where the only available outdoor space adjoins residential premises. The restrictions have led some premises to force smokers out onto footpaths and others to undergo expensive alterations and acoustic improvement measures in order to provide outdoor smoking areas.

As of 3 July 2006, smoking is only permitted in one room of a multi-room venue (if the combined total area of the rooms is greater than 100m² the room must not exceed 25% of this area; if the combined total area is less than 100m², the room must not exceed 50% of this area). In single-room venues, smoking is permitted in up to 25% of the area.

'Room' is defined to mean bar room, gaming machine room or recreation room only. Areas where food is served, toilets, lobbies, thoroughfares, dance floors, auditoriums and casino private gaming areas must be non-smoking and must be excluded from the calculation of combined total area of rooms. Smoking areas must be separated from non-smoking areas by the use of a partition or barrier or at least 1.5m.

From 2 July 2007, all enclosed areas of hotels, clubs and nightclubs that are open to the general public must be completely non-smoking. Smoking will only be permitted in outdoor areas.

To be eligible as an 'outdoor' area, at least 25% of the total notional ceiling and wall area must open directly to the outside. The total notional ceiling and wall area is the sum of:

1. the total area of all wall surfaces: assuming the walls are continuous (all existing gaps are filled) and are of uniform height equal to the lowest wall; and
2. the total floor area of the space between the walls if the walls were continuous.

This definition excludes any additional wall or ceiling space due to sloping ceilings. The government has refused to amend this definition, despite arguments from ClubsNSW and the Australian Hotels Association that this unfairly disadvantages smoking areas with pitched or angled roofs. Any openings provided in the additional surface area created by a sloping roof will therefore not count toward the 25% required by the regulations.

The 25% must comprise at least 10% gaps (being gaps directly to the outside, other than gaps caused by windows, doors or other moveable structures being open) and up to 15% locked-open doors and windows (being doors or windows that are permanently locked open whilst the premises are trading). Openings due to walls, doors or other moveable structures being open do not count for the purpose of this definition.

If an occupier intends to rely upon locked open doors or windows, the occupier will be guilty of an offence unless these doors and windows remain locked fully open for the entire hours of operation while smoking is permitted.

These numerical restrictions will inevitably act as a design constraint on any proposed development.

This new restriction, due to come into force in July 2007, is creating problems for venues which desire to continue to permit smoking. In anticipation of these pending restrictions, many clubs and pubs are already submitting development applications for outdoor smoking areas. For some premises, substantial internal alterations have been necessary in order to facilitate the use of these areas. ClubsNSW estimates that clubs will spend nearly $450 million on renovations in response to the new laws.

Outdoor smoking areas are also potentially problematic as they are a source of noise complaints from neighbouring residential premises. The Liquor Administration Board's after-midnight noise criteria requires that noise from licensed premises be inaudible in any habitable room of any residential premises between 12am and 7am. It is crucial for applicants to work closely with an acoustic expert to advise on how these outdoor areas can operate effectively next to these premises. Media reports suggest that some pub owners have resorted to purchasing adjoining residences in order to create an acoustic buffer.

Concern over potential health risks is shaping up to be a major issue with a number of councils that are faced with applications for outdoor smoking areas. North Sydney and Manly Councils have deferred consideration of all such applications pending legal advice regarding Council's potential liability for the drift of smoke from the outdoor smoking areas. Fairfield Council appears to harbour similar concerns. It has approved a number of applications subject to strict conditions banning non-smokers from the smoking area, requiring security guards to patrol the area to ensure that it is being used by smokers only and prohibiting bar service or the consumption of food in the area.

The total ban on indoor smoking poses several challenges for licensed premises. Operators who are considering lodging development applications for outdoor smoking areas need to be aware of the design constraints as well as acoustic and health issues associated with such a proposal and should consult with experts to have these matters addressed at an early stage in the process.

Over the last 12 months, the Land and Environment Court has taken a more systematic approach in dealing with development applications concerning licensed premises. A series of standard questions (known as planning principles) will now be considered for applications involving increase in hours or patron numbers for licensed premises. This approach has placed a burden on operators to prove that they have managed the premises satisfactorily in the past and can do so if the application is approved. Previous management practices and police records relating to the premises are a major focus. Operators considering lodging an application should address management and security issues at a very early stage. It is a good idea to start tightening up management practices long before a development application is even lodged with council. Surveys that detail the behaviour of patrons in terms of transport and arrival and departure times may also need to be undertaken in advance.

In Vinson v Randwick Council (2005) 141 LGERA 27, the Court set out a number of questions that will need to be addressed in assessing applications of this kind:

1. What are the adverse impacts of the present trading hours, permitted number of patrons and permitted activities?

Evidence of anti-social behaviour that is linked to the premises will be examined by the Court − this will usually come in the form of records such as the police COPS system, other police records and anecdotal evidence or diaries kept by local residents. Depending on the location and nature of the premises, these records will usually detail noise from people on or leaving the premises, its plant and equipment, noise from entertainment provided on the premises, incidents between patrons and security guards and incidents relating to the responsible service of alcohol.

The police local area command will also generally comment on a development application relating to a licensed premise.

The applicant may be able to respond to this type of evidence with well-kept incident books, or expert evidence from a town planning expert. If the application is appealed to the Land and Environment Court it is possible to test police evidence by subpoenaing police records relating to the premises and similar nearby premises. This information will help to place the history of the premises in context. It is important to note that many COPS incidents merely record business inspections by police or events only indirectly linked to the premises. Incidents occurring at the premises should be examined and categorised. In a recent matter where gadens lawyers represented the nightclub applicant, the Court commended the applicant for providing a table categorising the various incidents to the Court to aid its interpretation and understanding of the nature of the numerous incidents recorded against the club.

2. What measures are in place to address those impacts and are those measures well documented?

The measures that are currently in place to record and respond to complaints made by residents are relevant.

Also of relevance will be the responsibilities of security personnel and whether they have been successfully performing their duties, evidence that incident books are in order, evidence that a plan of management is in place and has been consistently adhered to, and evidence of other measures enforced by the licensee and management to control patrons and the responsible service of alcohol.

A plan of management for the premises should be included as part of any development application and should provide measures to deal with any anticipated impacts of the proposal. If increased hours or patron numbers are proposed, an Applicant should expect that Council may require additional security personnel. For applications for extended hours (particularly trading past 12am) or for use of the premises to provide entertainment, acoustic issues will be of fundamental importance. It will generally be necessary to implement measures to ameliorate acoustic impacts.

3. Have those measures been successful?

If the present management regime has been in operation for a relatively short period, or has been unsuccessful or not fully implemented, less reliance can be given to it by the Applicant than to a management regime which has succeeded in reducing antisocial behaviour.

4. What additional measures are proposed by the applicant or might otherwise be required?

As discussed in our September update read more ... applicants should be aware that with applications to modify conditions, there is a risk that the Court may alter other conditions that are not strictly the subject of the appeal, including, approved hours of trade.
By Anthony Whealy & Isabella Ferguson

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.