Licence Tribunal
Appeal d'appel en Tribunal matière de permis
DATE: 2015-10-16
FILE: 9238/LLA
CASE NAME: 9238 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 Revoke a Licence
1559149 Ontario Limited o/a Piccola Citta Bar & Cafe Appellant
-and-
Registrar of Alcohol and Gaming Respondent
REASONS FOR DECISION AND ORDER
ADJUDICATOR: Simon Dann, Member Eleanor White, Member
APPEARANCES: For the Appellant: Michael Hassell, Counsel
For the Respondent: Aviva Harari, Counsel
Heard in Toronto: April 14, 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 November 12, 2014, to revoke the liquor licence of 1559149 Ontario Limited operating as Piccolo Citta Bar & Caffe (the “Appellant/Piccolo”). The Appellant appealed this Proposal to the Licence Appeal Tribunal.
The basis of the Proposal was that (1) contrary to subsection 45(1) of Ontario Regulation 719/90, the licence holder permitted unlawful gambling, and (2,contrary to subsection 25(1) of Ontario Regulation 719/90, alcohol was sold and served outside of prescribed hours.
The Registrar's Counsel, Ms. Harari stated that video gaming machines were found in the back room of the establishment and that she would present video evidence to show alcohol service outside of the prescribed hours.
The Appellant's Counsel, Mr. Hassell, stated the machines were for entertainment purposes and the licence holder would give evidence that he did not serve alcohol prior to 11:00 a.m. but did pour flavourings into the coffees he served.
REGISTRAR'S EVIDENCE
Steven Hetherington ("Hetherington") is an inspector with the Alcohol & Gaming Commission of Ontario ("AGCO"). He arrived at Piccolo with two police officers, just after 11:30 a.m. on March 28, 2014, and met with the owner of the establishment, Frank Pacifico (“Pacifico”).
At the rear of the establishment, he found a dimly lit room with 3 video game terminals which were not initially visible. These were a Super Shanghai, a Western Venture and a Keno machine. Hetherington described them as casino slot machines which have a kill switch and a knock off credit switch to allow the operator to delete credits. He was told by Pacifico that no one pays to play them and there are no payouts.
After the police asked for the machines to be opened, Hetherington noticed the Super Shanghai had in and out meters to record credits and amounts paid out. It did not have a bill accepter as the credits were usually entered by key. The Western Venture machine also did not have a bill accepter. The Keno machine was found to have a bill accepter and was tested with a $20 bill which resulted in credits being registered.
Hetherington requested the security videos and picked them up on April 4th. After viewing the security videos, he returned on April 9th and met with Pacifico's son, Peter Pacifico and advised him of the issue concerning the sale and service of alcohol outside of prescribed hours.
Ms. Harari then presented video recordings from March 28, 2014, which covered the bar area as well as the room with the video machines. Between approximately 8:28 a.m. and 10:14 a.m., Pacifico is seen to several times remove a bottle from the bar behind him and pour a quantity of liquid into coffees.
It was acknowledged that there was no first-hand witness and it is the video images which were interpreted to show bottles of alcohol. This led to the allegation of sale and service of alcohol outside of prescribed hours.
Regarding the gaming machines, Ms. Harari pointed to Pacifico's activity at the machine, describing it as both the knocking off of credits and the adding of credits. In one sequence, Pacifico is described as giving a patron some cash.
Hetherington suggested that one sequence showed Pacifico taking currency out of the Keno machine.
The black and white video images were not close up, or clear enough, for the Tribunal to confirm Hetherington's description.
The actions at the gaming machines are recorded between 8:55 a.m. and 11:17 a.m. on the inspection date of March 28, 2014.
In cross-examination, Hetherington confirmed there is no first-hand observation of alcohol service or any money transaction between Pacifico and any patron.
Hetherington said the bottles were displayed on the shelf and while he did not investigate them to confirm they contained alcohol, the inference for him was that they contained alcohol and not flavourings. He relied on the video for his conclusions.
It was acknowledged that the video games could not pay out money and were claimed by Pacifico to be for amusement only. Hetherington disagreed with that claim.
The Western machine had a coin slot but he did not test it to see if it accepted coins. One video section is described as showing the exchange of money, but as there is no audio, Hetherington said he had no idea of what was being discussed at that moment.
Craig Dickie ("Dickie") is a Detective Constable with the Toronto Police Service. He arrived at the establishment at 11:34 a.m. on March 28th and found Pacifico and about 15 patrons.
Dickie's description of the gaming machines in the back room of the establishment was similar to Hetherington's.
The Super Shanghai was locked with a padlock and Dickie described it as having a double rivet knockoff switch to reduce accumulated credits back to zero. He tested the machines and found that one turn of the key on the Super Shanghai machine gave 100 credits.
The Western Venture machine had a padlock and after receiving the key to open it from Pacifico, he found it had a slot for a $1 coin but he did not test it.
The Keno machine had a bill acceptor and when tested with a $20.00 bill, it added 80 credits. He also tested the knockoff switch and found it reset the credits.
In cross-examination, Dickie confirmed he did not witness anyone gambling or using the machines which, he said, could not dispense money. He also did not inspect the bottles on the bar.
APPELLANT'S EVIDENCE
Frank Pacifico ("Pacifico") has owned Piccola for just over 13 years. His customers are mostly retired and their ages range between 50 and 92. The three gaming machines found in the cafe were there when he purchased the business.
Pacifico stated that on March 28th, he did not serve any alcohol before 11:00 a.m. He also does not permit any gambling.
Regarding what he poured into the coffees, Pacifico said his customers like a flavouring in their coffee and he uses an almond extract. One of these is Orzata, which is kind of sweet while another is Rabarbaro, which is bitter and made of different herbs. They are not alcoholic.
Pacifico said the two bottles in the video, one at each end of bar, were the same (as the example shown in Exhibit 4). One bottle was finished and the other newly opened. He said that after 11:00 a.m., some customers do ask for alcohol and if served, it is in a shot glass.
He said the gaming machines could not pay out. The Western Machine coin slot was not operational and if a coin were inserted, it would just go into the back casing and if a customer put a bill into the Keno machine, Pacifico said he would give it back.
Pacifico acknowledged that when people go into machine room he uses his key to create credits and that when they are finished he goes back and returns the credits to zero for the next person.
He agreed that where the video shows him giving a customer something it was money because a customer had given him a $100 bill for a stag ticket and he gave him a $20 bill in change. (Exhibit 5 is a Stag Ticket copy showing the price to be $80. Exhibit 6 is a Stag Ticket Tracking form.)
Pacifico said it was only the day before the hearing that he first saw the security video. He said that where a patron appeared to be giving him money in the gaming room, it was for a tab the patron was running.
As far as the bill taken out of the Keno machine was concerned, Pacifico said the patron is the father of one of his employees and he gives the patron back the money after he is finished playing.
In cross-examination, Pacifico acknowledged the father of that employee was not present to testify because he had not been asked to bring any witnesses.
Pacifico agreed the gaming machines are not in plain view and while there is nothing to prevent anyone from going in to use them, they are only there for amusement. He said he cancels the credits so the next person can start over.
When asked if there was no value why he cancelled the credits, Pacifico said that it was for no particular reason, but just force of habit and if the machines were not there, it would not affect his business.
Registrar's Closing Submissions
The Registrar's Counsel reiterated that the two issues: service of alcohol before 11a.m. and the presence of prohibited gaming machines
Regarding the before hours service, Ms. Harari referred the Tribunal to video evidence showing a clear white bottle with a white neck while the one referred to by the Appellant did not have the same neck. Ms. Harari submitted that whether the amount of alcohol served is a shot or a dab, the service before hours is a violation.
Regarding the gaming machines, Ms. Harari submitted that these gaming machines are casino type machines and are contrary to the Criminal Code unless located in a government sanctioned casino.
She submitted that the characteristics of the machines found by Hetherington and Dickie had kill switches and reset buttons for fast stop and reset to zero. These are devices not found on amusement machines and it is suspected that they were tucked into a back room. It also did not make sense that Pacifico would run into the room to reset the machines to zero as soon as a player finished.
Ms. Harari asked the Tribunal to accept the totality of evidence about the three machines tucked into the back room and find that they were there for gambling which is not permitted in the liquor licence.
As an alternative to revocation, and since Pacifico had said the machines did not contribute to his business. Ms. Harari asked for a condition on the licence prohibiting them in the establishment.
Appellant's Closing Submissions
The Appellant's Counsel submitted that the Registrar's case is circumstantial, particularly as there is no direct evidence from witnesses regarding the allegation of alcohol service. The Appellant has said he only added flavourings.
Mr. Hassell submitted the gaming machines had been intentionally modified but there is no evidence to that effect. Since the machines are not able to pay out they are legal and it does not matter if they are in the back room. Mr. Hassell noted there is a video camera there and if the Appellant had wanted, he could have had no cameras there.
Mr. Hassell submitted further that the payment to the patron at the bar was for the stag party ticket and the payment or exchange in the gaming machine room was about a tab being paid off by the customer. As to the money put into the Keno machine by the individual who left without receiving it back, Mr. Hassell submitted there is only the video evidence to that effect.
Reasons and Analysis
There are two issues to be decided by the Tribunal, namely, did the Appellant permit
unlawful gambling to occur on the premises, contrary to subsection 45(1) of O.Reg. 719/90, and did the Appellant sell and serve alcohol outside of prescribed hours, contrary to subsection of 25(1) of O.Reg719/90. The evidence, while straight-forward on the former, is not clear on the latter.
The principal evidence presented for both allegations is video material showing activity within the premises. In the matter of permitting unlawful gambling, there were, as well, three machines found on the premises.
The video evidence shows that gaming machines were found in a back room of the establishment and that patrons used the equipment. The video allegedly shows the Appellant adjusting the credits and that money was also exchanged between the Appellant and a patron. It further shows a patron inserting money into one of the gaming machines.
The Appellant stated the machines were there for amusement only and that any money used to play the machines was returned to the patron when they were finished.
The Tribunal accepts the Appellant's explanation that he exchanged money with a patron for the purpose of providing change for payment for a stag ticket, but finds the Appellant's claim that he reset credits on the machines for "no particular reason" and "force of habit" to lack credibility.
Dickie's evidence regarding the operation of the three individual machines was persuasive. The Tribunal agrees with the submissions of the Registrar's Counsel that kill switches, reset buttons "for fast stop and reset to zero" would not likely be found on amusement machines.
The back room location is also suggestive of the fact that the machines were there for purposes other than simple amusement and, as the Registrar's Counsel noted, these are casino type machines, which are contrary to the Criminal Code unless located in a government sanctioned casino.
For these reasons and on a balance of probabilities, the Tribunal finds the Appellant did permit unlawful gambling to occur on the premises, contrary to subsection 45(1) of O.Reg. 719/90.
Regarding the alleged sale and service of alcohol outside of prescribed hours, the Registrar's evidence is reliant upon the surveillance video which shows the Appellant, on several occasions, taking a bottle from a bar shelf behind him and pouring amounts of a liquid from the bottle into cups of coffee.
The Appellant's evidence is that these were simply non-alcoholic flavourings which his customers typically like to have added to their coffee.
The testimony of both Hetherington and Dickie confirms there is no first-hand evidence of the sale and service of alcohol outside of prescribed hours. They did not inspect bottles on the shelf, to verify contents, on the day of their inspection, March 28, 2015. Given that they only noted what they believed to be the sale and service of alcohol after they reviewed the video, that is understandable.
While Hetherington noted the bottles alleged to contain alcohol product were displayed on the shelf with other alcohol products, the failure to check for the content of these bottles and to document what was on the bar shelf, even during the April 9th visit, allows for, in the Tribunal's mind, too much uncertainty and speculation as to whether the bottles contained alcohol. The video images do not show the bottle labels. When he attended at the premises on April 9th, after he had viewed the video, Hetherington had the opportunity to inspect the bottles on the shelf. He chose not to do so. Pacifico has given very clear and specific evidence as to what the bottles contained.
On a balance of probabilities, the Tribunal accepts the Appellant's evidence that the bottles contained non-alcoholic flavourings and finds that the Appellant did not engage in the sale and service of alcohol outside of prescribed hours.
Decision
For the reasons stated above, the Tribunal finds that 1559149 Ontario Limited o/a Piccola Citta Bar & Cafe, Licence number 802052 to be in breach of sub-section 45(1) of the Liquor Licence Act, but not in breach of subsection 25(1) of O.Reg 719/90.
In regard to sanction, the Registrar’s representative shall serve and file written submission within seven (7) days of the date of this decision and the Licensee’s representative shall have seven (7) days to serve and file a written response. The Registrar’s representative may serve and file a reply within three (3) days of the receipt of the Licensee’s response. All submissions are to be filed with the Tribunal.
LICENCE APPEAL TRIBUNAL
Simon Dann, Member
Eleanor White, Member
Released: October 16, 2015