A non-profit organisation successfully applied for a declaration that a non-statutory process that allowed pokie machine operators to relocate was unlawful under the Gambling Act 2003.
The Gambling Act 2003 (“Act”) was enacted as a response to the social harm caused by electronic gambling machines known commonly as ‘pokies’. The Act established stringent requirements relating to these ‘Class 4 gambling machines’. Among other things, businesses offering pokies are required to have both an operator licence and a venue licence.
Venue licences are automatically subject to a condition limiting the number of pokies within the venue. However, this requirement does not apply to venue licences issued before a date specified in the Act. These licences continued on the same terms as applied prior to the commencement of the Act (an arrangement known colloquially as ‘grandfathering’).
Originally, the Act did not expressly provide for relocation of venue licences. The apparent position was that for a venue to move even slightly (for example, to a neighbouring property) required a new venue licence application. When that occurred, the new licence would not have the benefit of the grandfathering provisions, inevitably meaning that fewer pokies were allowed at the relocated venue.
This position changed following ILT Foundation v Secretary for Internal Affairs [2013], a High Court decision concerning the venue licence for the Waikiwi Tavern (“Waikiwi Decision”). The owner sought to move their premises 200 metres to a neighbouring section,and a declaration that this could be lawfully achieved via a change to the conditions of their venue licence. The court granted the declaration, holding that minor relocations were not changes in “venue” under the Act and could therefore be completed via amendments to venue licence conditions.
Following the decision, many similar relocation applications were made to the Department of Internal Affairs (“DIA”), the responsible regulator. These became known as ‘Waikiwi Relocations’.
At around the same time, Parliament amended the Act. One of the amendments allowed local councils to have the final say over venue relocations under new venue relocation policies. The amendments were made in apparent ignorance of the Waikiwi Decision.
DIA continued to process Waikiwi Relocations notwithstanding the amendments until 2018, where they revised their approach and held that the relocations were no longer permitted. This attempt to change course was successfully appealed to the Gambling Commission, which treated the Waikiwi Decision as settled law.
In 2023, Feed Families Not Pokies (“Applicant”) (a charitable organisation seeking to mitigate the social harm caused by pokies) sought to have the law clarified. They applied to the High Court for declarations that Waikiwi relocations had been unlawful since the 2013 amendments. The application was supported by DIA but opposed by the Gaming Machine Association.
The parties accepted that the Waikiwi Decision had been correct at the time when the Act was silent as to venue relocations. The contentious issue in this case was whether the 2013 amendments had changed that interpretation and ousted Waikiwi relocations by implication.
The Applicant argued that Parliament, in enacting the 2013 amendments, had intended that local authorities have exclusive oversight of venue relocations within their district. The Gaming Machine Association argued the basis of the Waikiwi Decision was that minor relocations involved no change of “venue”. Accordingly, they concerned different subject-matter than was covered by local authority relocation policies, and the two processes could therefore co-exist.
The court found for the Applicant. The points made in the Waikiwi Decision about whether changes in location amounted to changes of venue were specific to the legislative context, which did not provide for venue relocations. The same reasoning did not automatically apply when that context changed.
The court held that three factors supported the contention that the 2013 amendments had rendered Waikiwi relocations unlawful:
The court made a declaration that Waikiwi relocations had ceased to be lawful following the 2013 amendments. However, to avoid unfairness to parties who had successfully relied on the law as it had been understood before the case, the court held that the declaration would not retrospectively invalidate any existing venue licence.
Whether an individual licence had been modified unlawfully was a question that could be determined in separate judicial review proceedings. A court in such a case would have regard to the good faith reliance of prior applicants in determining whether it was appropriate to grant relief.
The result means that Class 4 venues seeking to relocate, even to a minimal extent, will now require territorial authority consent to do so, in accordance with the prevailing venue relocation policy in their district. If there is no policy in force, it is likely that a business seeking to relocate will need to apply for a new venue licence (and will not retain the benefits of any grandfathered licence).
Businesses that have relied on Waikiwi relocations in the past are not likely to sleep easily. While the court held that the declaration did not invalidate prior relocations, the licence amendments that allowed those relocations could be independently challenged.The court here hinted that the prejudice to those businesses (who had reasonably relied on what was at the time assumed to be good law) might point against invalidating those decisions. However, this decision ultimately remains at the discretion of a future reviewing court.
For further information on this case or similar issues, please contact Brigitte Morten, Director
