Licence Tribunal

Appeal d'appel en

Tribunal matière de permis

DATE:

2015-06-17

FILE:

9281/LLA

CASE NAME:

9281 v. Registrar of Alcohol and Gaming

Appeal from the Notice of Proposal of the Registrar of Alcohol and Gaming under the Liquor Licence Act, R.S.O. 1990, c. L. 19 - to Refuse to Remove Conditions from the Licence.

North Brooklyn Inc. o/a North of Brooklyn Pizzeria

Appellant

-and-

Registrar of Alcohol and Gaming

Respondent

-and-

City of Toronto and Joanne Barnard

Added Parties

DECISION AND ORDER

ADJUDICATOR:

Alex McCauley, Member

APPEARANCES:

For the Appellants:

Joshua Spatz, Agent

For the Respondent:

For the City of Toronto:

For the

Resident Objectors:

Tamara Brooks, Counsel

Katherine Brickman, Student-at-Law

Mark Crawford, Counsel

Alexandria Jones, Student- at -Law

Joanne Barnard, on her own behalf and as Agent on behalf of the Resident Objectors

Heard in Toronto:

April 29, 2015 and May 20, 2015

DECISION AND ORDER

BACKGROUND

The Registrar of Alcohol and Gaming (the “Registrar”) under the Liquor Licence Act, (the “Act”) issued a Notice of Proposal, dated December 5, 2014, to refuse to remove the conditions on the licence. North of Brooklyn Inc. (the "Appellant") appealed this Notice of Proposal to the Licence Appeal Tribunal.

In December 2012, several conditions were imposed on the liquor licence of the Appellant, North of Brooklyn Pizzeria (NBP).

The Appellant, seeks the removal or modification of 5 conditions attached to liquor licence #91086, on the grounds that there is a change in circumstance from the time that the original conditions were agreed to.

The City of Toronto, through a motion of its Council, on December 11, 2014, objected to the removal of the conditions.

There were several letters of objection to the removal of conditions from residents, approximately 5 in total, living in and around the area of the Appellant’s premises. In addition, several residents attended the hearing in order to provide evidence on behalf of the Objectors.

The Registrar has not taken any position with respect to the removal of the conditions.

The Appellant wishes to remove or amend the following conditions (the numbering corresponds to their listing on the liquor licence):

1. The Licensee shall not have open windows or propped open doors on the Premises after 8:00pm.

2. The Licensee shall not sell spirits on the Premises.

3. The Licensee shall not have outside seating at the Premises.

4. The Licensee shall ensure that any sound that clearly originates from the operation of the business at the Premises is not audible at any residential building after 8:00pm. This clause includes, but is not limited to, sound generated by any internal or external loudspeakers, conversation by patrons within or outside the Premises, bussing, garbage disposal and bottle disposal.

5. The Licensee shall close the Premises at the following times:

9:00pm on Sunday.

10:00pm on Monday through Thursday, and

12:00am on Friday and Saturday.

THE LAW

Section 14(2) of the Act states:

(2) The Tribunal may, on the application of a licensee, remove a condition of a licence, other than a prescribed condition or a condition attached pursuant to section 8.1, subsection 10 (4), 11 (5), 11.1 (4) or clause (1) (a), if there is a change in circumstances.

ISSUES

There are two issues to be addressed by the Tribunal: whether there has been a change in circumstances that supports the removal (or modification) of the conditions pursuant to section 14(2) and whether their removal will negatively affect the public interest.

EVIDENCE

The Tribunal heard from the principal of the Appellant, Joshua Spatz, who stated that in his opinion there have been several changes in circumstance which affect the business of North of Brooklyn Pizza.

Firstly, Mr. Spatz stated that he and his partner in the business were very naïve when they agreed to the conditions on the licence when the licence was first granted in December 2012. The information he had at the time was that if he didn’t agree to these conditions he would be held up in obtaining a licence. There were public objectors and at the time he felt it more expedient to agree to the conditions. He did admit that he had access to legal counsel at the time, but stated that the counsel they retained was inexperienced in this area.

He went on to state that when they agreed to the doors and windows being closed after 8 p.m. they were not in the warmest part of the year. Now they have two pizza ovens and the temperature in the premises at times is unbearable.

Regarding condition #2, which allows him only to sell beer, but no spirits, he would like this condition removed because patrons are requesting other types of drinks which are accessible at other area establishments in close proximity to his business.

Mr. Spatz went on to state that businesses new to the area are not required to operate under the same restrictions as his business does.The businesses he referred to are:

• Enso Pizzeria and Bar at 2013 Queen St. which has no restrictions and is open late.

• Marquerrita Pizza at 772 Dundas St, which is 5 minutes away, and became licenced in October, 2014.

• Lisa Marie at 638 Queen St. West, and

• Come and Get It at 776 Queen St. West, both of which operate without conditions on their indoor licence.

All were licenced after North of Brooklyn.

In his opinion, there has been a change in the business environment of the neighbourhood. The neighbourhood has become more of a late night spot that people attend for restaurant and bar services. In his view, there no longer exists a level playing field, where businesses can compete equally. Many of the businesses in the same type of business that he is in, have liquor licences that do not include restrictions on their ability to operate. As a result, he loses business and market share; customers go elsewhere.

The Appellant has had a bench outside, which is contrary to his conditions. He would like to provide a minimum amount of outside seating for his patrons. There is an area above the premises which could serve as an outside balcony. Mr. Spatz is under the impression that because of his current conditions, he is prohibited from applying to use this area.

Regarding condition #5, relating to noise, the Appellant would like to see this modified so that it is more practical for the normal operation of the business.

With respect to condition # 18, the Appellant would like to adjust the hours so that the restaurant can be open at peak times and can be competitive with similar businesses in the neighbourhood. The Appellant is content to maintain the hours for the sale and service of alcohol to where they are now.

Mr. Spatz presented several letters of support (Ex. # 3) from area residents and business owners. One letter contained 4 signatures from area business owners, and one letter was from a couple who live in the area.

In cross examination from Ms. Barnard, Mr. Spatz admitted that he had not received any letters of support from the Palmerston St. residents.

RA is a supporter of the efforts of NBP to have the stated conditions on the liquor licence removed or amended. He has lived and worked in the area since 1993 and has seen positive changes in the area. A new culture has developed, which is enhanced by the business community. The business community has worked to clean up the problems that plagued the neighbourhood in the past. He stated that Mr. Spatz and his partner have been a very positive influence in the area.

Ms. Barnard called Heather Thompson who is currently a sergeant with the Ontario Provincial Police (OPP) as a witness. Sergeant Thompson explained her role and her duties with respect to liquor licence enforcement. She is responsible for supervising the activities of liquor inspectors who oversee licensed premises within the Toronto area.

In her evidence, she referred specifically to four inspection reports submitted by Inspectors regarding North of Brooklyn Pizzeria. The dates and details of the reports are as follows:

1. August 7, 2013- Alleged breach of conditions

2. August 21,2013 - Breach of condition, no other infractions observed

3. June 8, 2014 - Breach of condition

4. June 12, 2014 - Breach of condition- door and window open.

All of these were the result of complaints called in by area residents regarding alleged breaches of conditions and all were investigated. The complaints dealt with doors or windows propped open, failing to circulate a phone number to residents, open past 10pm, and illegal outside seating (a bench).

There was no disciplinary action taken on any of these complaints. The owners of the establishment were advised of the complaints.

Sgt. Thompson stated that these alleged breaches were not viewed as serious infractions. The enforcement unit is more concerned about matters of disorderly conduct.

RW, a resident objector, cited his major complaint as noise. He resides very close to the Appellant’s premises. The noise, in his opinion, emanates from within the pizza restaurant and outside when are patrons leaving. He stated the noise disrupts his sleep. RW stated there is a disruption to the peace of the neighbourhood because of the restaurant.

He further stated that parking has become problematic, with patrons’ vehicles and delivery vehicles. RW referred to photographs of a large group of people congregating outside NBP. The photos are contained within Exhibit #5.

CH resides on Palmerston Ave. He is concerned about traffic and loitering in the area and that problems will be exacerbated if NBP is permitted to be open late. The establishment is located where school children walk to and from school and he is concerned about the impact of traffic in the area.

CH referred to an incident in 2012 when the principals of the establishment were observed to be intoxicated on the street.

KC, also resides on Palmerston Ave., and complains of noise and disorderly conduct of NBP staff. He pointed to a photo of staff standing outside smoking and passing what was a suspicious cigarette. In re-examination, he stated he has smelt the odour of marijuana from this area. It is his opinion that the business should never have been put in that building.

Joanne Barnard has resided on Palmerston Avenue for 24 years. She is concerned that the condition about doors, and windows being closed, is not being complied with. Voices from the street, keep her awake.

She has complained several times to the inspection branch of the Alcohol and Gaming Commission (AGCO) and has had several conversations with AGCO Inspector Leadbetter.

She referred as well to a November 24, 2012 incident when she observed drunken behaviour in front of the restaurant and reported this. She has observed the owners and staff of NBP drinking after hours.

Michael Layton, Councillor City of Toronto has represented Ward 19 since December 2010. He lives within the Ward and has lived in this area for 26 years.

He describes the neighbourhood in question as being a very vibrant community with family homes that abut the main streets. The Palmerston Street area is a mixed residential and commercial area.

He stated that it was his intention to attempt to get conditions on the licence in order to make it better for the residents so that they would not have to put up with excessive noise or disorderly behaviour. The Appellants agreed to the conditions being placed on the license when they opened in December, 2012. .

It is his position that there has not been any valid change of circumstance affecting North of Brooklyn Pizza that would warrant a change or alteration to the conditions currently on the licence. This is why Toronto City Council passed a motion objecting to any changes to the conditions currently on the liquor licence.

He is still concerned about the effect that the business activity of North of Brooklyn Pizza will have on the neighbourhood, especially those residing on Palmerston Avenue.

Regarding condition number 2 which deals with the serving of spirits, Mr. Layton stated that he takes no position on that the particular condition. In other words, he would not be troubled if that condition was removed.

Mr. Layton stated that the businesses that have been referred to by the Appellant in his evidence, Queen Margarita Pizza 772 Dundas Street West, and Lisa Marie at 698 Queen Street West have not been complained about, at least as far as he is aware.

Mr. Layton admitted that the City struggles with the enforcement of noise complaints. It is his opinion that the bylaw department and the police service are overwhelmed. This is why he is very interested in seeing conditions placed on the liquor licence; it assists with noise control issues.

Mr. Layton stated that he is aware of complaints about lack of enforcement. He has attempted to bring all the necessary groups together to address the issue, primarily noise. Mr. Layton admitted that it is quite possible that there are complaints from other establishments in the area but they don’t all necessarily make it to his desk.

Mr. Layton stated that he is a patron of North of Brooklyn Pizza.

Submissions

In summing up their position, the Appellant reiterated that they are attempting to remove four of the conditions and to amend condition number 18.

IMr. Spatz submits that several changes have taken place that change the circumstances for them, from the time when they first agreed to have the conditions on the license, to what the situation is today. They point to the fact that there are many new establishments in the area who operate businesses similar to theirs and yet have no restrictions on their licence, and any restrictions that they may have are not as severe as the ones facing NBP.

The competitive landscape in the area has changed and in order for them to be able to compete, they must have some latitude around the conditions that currently exist on the licence. Area businesses are open later. One business in particular that is located in the same building as their particular business, Hero Burger, is now open till 2 a.m. on Saturday and Sunday.

The Appellant points to increased support for their business in the area compared to when they first received their licence in 2012. They still do not have endorsements from Palmerston Avenue residents, but they have several letters of support from residents around the area and from the businesses in the area.

The Appellants admit that there have been two or three incidents over the past three years which they regret. They apologize for these incidents; they were mistakes that have not been and will not be repeated.

Ms Barnard submits there has been no significant change in the competition for North of Brooklyn Pizza, and that there is no valid justification for change of circumstance. Residents, especially those on Palmerston Avenue, have a right to their peace and quiet and peaceful enjoyment of their homes.

In the view of the residents, there have been many examples of contempt for the rules by North of Brooklyn Pizza. In their evidence, they had cited breaches of the conditions on the current licence and instances of drunken behaviour on the sidewalk by the owners.

The other businesses referred to by the Appellant are located on Queen Street and are not as close to the residential area as is North of Brooklyn Pizza.

The Appellants do not have the support of the residents of Palmerston Avenue, nor have they cooperated with the residents in the area.

Ms Barnard submitted that capital improvements to the facility would help in controlling the heat in the summertime. It is the position of the residents that there has been no change in circumstance that would warrant changing the conditions on the liquor license.

The City of Toronto submits that there has been no significant change of circumstance from the time that the Appellants agreed to the placing of the conditions on the licence. It is the position of the City that a change in circumstance must be meaningful. Prior decisions of the AGCO Board and/or the Tribunal were submitted in support of this position.

The City of Toronto argues that allowing the licensee to keep the doors and windows open beyond the stated time, is detrimental to the residents in the neighbourhood and therefore contrary to the public interest. In relation to condition number 3, outside seating, this would just exacerbate the unwanted noise.

Regarding Condition 5, noise after 8 pm has been cited by the residents as excessive.

Mr. Layton described the area where North of Brooklyn Pizza is located as unique to the area. It abuts a residential area. The door opens from the restaurant towards the residential area as opposed opening directly on Queen Street.

APPLICATION OF LAW TO FACTS

After considering the evidence and the submissions, and after reviewing the various AGCO Board and/or Tribunal decisions submitted by the parties, the Tribunal has concluded that the Appellant has satisfied the onus of establishing that there has been a change in circumstance from the time that the conditions were first placed upon the licence. The most obvious change has been the competitive landscape in the area.

In addition, the culture and environment of the neighbourhood, particularly in the Queen Street area, has changed, becoming more of a late night restaurant area. The restaurant businesses operating in the area have taken advantage of this change of environment. North of Brooklyn Pizza is one of those businesses, but in the opinion of the Tribunal it is very disadvantaged because of the restrictive conditions placed on the liquor licence. The Tribunal is very cognizant of a business’s ability to operate on a level playing field with its competitors.

The Tribunal is also of the opinion that the Appellants entered into the agreement on the original conditions voluntarily. That event was not considered by the Tribunal as a change of circumstance.

This Tribunal will now deal with the public interest issue. It is the view of the Tribunal that there must be a balance of interests between residents in the area and the commercial enterprises which operate there.

The residents who object to any change to the status quo cite disruption to their peace in the neighbourhood. They refer to past behavior of the Appellant’s principals such as not abiding by the conditions currently in place such as closing doors and windows as required. The Objectors point to rowdy behaviour on the part of the owners of the establishment, albeit this appears to be one occasion, that being in 2012.

Objector CH referred to a sketch in Exhibit 5B which showed a route taken by school children. The Tribunal does not see the relevance of the fact that children walk past the Appellant’s business to this application. None of the conditions referred to has any implication, positive or negative, to the safety of children

The Objectors come from the Palmerston Ave. area. They seem to have been opposed to the Appellant’s business since its inception. There does not seem to be a willingness by the Objectors, or for that matter, the Appellant, to try to resolve their differences in a meaningful way. This is very unfortunate and the Tribunal would encourage all parties to sit together and try to resolve their differences in an amicable fashion.

The Tribunal finds it difficult to believe that all the noise and disruption experienced by the Objectors flows from the activities of North of Brooklyn Pizza with its current latest time to be open of midnight, 2 days a week.

If ongoing noise was deemed a concern, the Toronto by-law department should have been engaged. The lack of any enforcement action from the local police or by-law department indicates noise or disruptive behaviour is of a very low priority. The Tribunal does note that there was no evidence that the police or by-law departments were regularly notified. Mr. Layton indicated in his evidence that the police and by-law departments are over whelmed. That may be, but there is still a requirement to respond to citizens’ concerns and there was no evidence that this was the case.

There has been no disciplinary action by the liquor inspectors from the AGCO regarding the alleged breaches of license conditions by the Appellant. The Tribunal notes that the AGCO inspectors, especially Inspector Leadbetter, did attend on all of the complaints called in by the Objectors, and appear to have carried out their due diligence.

The Tribunal heard evidence from Sgt. Heather Thompson. Her current duties are to supervise the activities of the inspectors from the AGCO and police officers under her command with regard to the enforcement responsibilities under the Act.

Sgt. Thompson made it clear that the types of complaints received in regard to breaches of conditions by North of Brooklyn Pizza were, in her view, minor. These breaches would not be subject to sanction. Sgt. Thompson and her team are more concerned about matters of public safety that result from breaches of the act by liquor license holders.

The City of Toronto, for its part, is faced with the dilemma of having a licensed restaurant abutting a residential area. The City of Toronto pushed for conditions on the liquor licence which, at the time, were agreed to by the parties. Now circumstances have changed. The City still wants the conditions in place

It is the opinion of the Tribunal, after hearing all of the evidence presented, that to remove or amend the conditions on the liquor licence of North of Brooklyn Pizza as requested by the Appellant does not violate the public interest. Amendment or replacement of certain of the conditions will serve to balance those public interest concerns. The Tribunal is mindful of the residents’ concerns and by modifying the conditions as opposed to completely removing them, the Tribunal hopes to strike a reasonable balance between the competing interests of the parties.

There has been no evidence presented to the Tribunal that would indicate that the Appellant, through its business, causes such disruption to the residents as to deprive them of the lawful and peaceful use of their property. The AGCO Inspectors have attended at the premises a number of times and have not implemented sanctions. There was no evidence of any police or by-law enforcement action against the Appellant business.

As the Appellant clearly presented in its evidence, they simply want to operate their business in a fashion that assists them in being competitive with those operating around them.

The Tribunal notes that the licensed premise is subject to the obligations established in the Liquor Licence Act that serve to control behaviour which negatively impacts the neighbourhood. Licensees are not only responsible for ensuring that there is no disruptive behaviour inside their premises but outside their premises as well.

The Tribunal in its Order has removed or replaced the conditions which were the subject of this hearing. As stated above, where replacement conditions have been imposed, this is to balance the concerns of the area residents with that of the interests of the Appellant.

All other conditions which appear on the liquor licence, but were not part of the application and this hearing, shall remain in effect.

ORDER

Pursuant to the authority vested in it under the provisions of the Act, the Tribunal directs the Registrar as follows:

1. Condition 1 shall be removed from the liquor licence and replaced with the following:

”The Licensee shall not have propped open doors past 10:00 p.m. and open windows after 11:00 p.m.”

2. Condition 2 is to be removed from the liquor licence.

3. Condition 3 shall be removed from the liquor licence and replaced with the following:

“The Licensee shall not have outside seating at the Premises unless approved by the City of Toronto.”

4. Condition 5 shall be removed from the liquor licence and replaced with the following:

“The Licensee will make every effort to ensure that noise originating from the operation of the business is not disruptive to the residents of the area.”

5. Condition 18 is removed from the liquor licence and replaced by the following:

“The Licensee shall close the Premises at the following times:

11:30 p.m. on Sunday

12:00 a.m. on Monday through Thursday, and

2:00 a.m. on Friday and Saturday.

Alcohol is permitted to be sold and served during business hours.”

LICENCE APPEAL TRIBUNAL

Alex McCauley, Member

Released: June 17, 2015