It is common nowadays for a licensing Authority to refuse the issue of licence on grounds of suitability of the Applicant in cases where the Applicant is a company.
The Authority stated, in Re Jays LLA 994/94, 15 July 1994, at 4 that:
“Differing aspects of suitability will be given different weight by decisionmakers (sic) under the Act. Among them are experience in the hospitality industry, management ability, and personal integrity.”
In Re Nishchay’s Enterprises Ltd [2013] NZARLA PH 837, the Authority said at [53]:
“… suitability is a broad concept and the assessment of it includes the character and reputation of the applicant, its previous operation of premises, its proposals as to how the premises will operate, its honesty, its previous convictions and other matters. It also includes matters raised in reports filed under s 33 of the Act and those reports may raise issues pertaining to the object of the Act as set out in s 4.”
The High Court has recently discussed suitability in Ole Ltd v Benge [2024] NZHC 284 dismissing an appeal against a cancellation of a licence and the cancellation of a manager’s certificate after a fifth alcohol-related conviction for the director/shareholder of the licensee appellant who also held a manager’s certificate. The present circumstances are different to the one in Ole Ltd as addressed below.
Lifting the corporate veil
It is interesting to note that the Authority may lift the Corporate veil and consider aspects associated with the directors.
In Re Golden Apple Corp Ltd LLA 1471/95, 11 July 1995, an application for an on-licence for a massage parlour was refused on suitability grounds after the hearing of extensive evidence relating to its operation and the “lifting of the corporate veil” in respect of the applicant company’s director. The unsuitability would also extend to any company in which the director had a controlling interest.
We have assisted many business owners to fight against the Authority and it is important you get the right advice and expert on your side.
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