All Posts by Dan Coles

Cactus Club Café and the law of Wining & Dining

Imagine this: you and a date visit a restaurant and order a bottle of wine while you catch-up, consider the menus, and enjoy the ambience. After the better part of two hours, but before ordering and consuming any food, you order a second bottle of wine.

Is this an entirely innocuous and unremarkable event? Or is it a contravention of the Terms and Conditions that are attached to all Food Primary Liquor Licences in British Columbia, and warrants the licensee suffering a monetary penalty in the amount of $1,000 or a licence suspension of one day?

Unless you are a first time reader of Alcohol & Advocacy, you probably already know where this is going….

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August, 2022 General Liquor Policy Changes

So far 2022 has been a relatively slow year for policy changes by British Columbia’s Liquor and Cannabis Regulation Branch. Readers of A&A will know that over the last couple years (largely driven by COVID) government regulators had been rolling out some substantial changes to liquor policy. But 2022? Not so much.

That changed a little on August 15, 2022 when the Branch published Policy Directive No. 22-13 that contained six changes to liquor policy. The changes are as follows:

1 – Buying Liquor: the Terms and Conditions Handbooks have been updated to confirm that licensees may only purchase liquor for the purpose of selling or serving it. This subtle clarification confirms that a bar or restaurant cannot purchase liquor that it cannot lawfully sell.

2 – Automated Liquor Dispensing Systems (ADS): Are now permitted (yay?) provided the liquor being dispensed comes from the original container, and the ADSs are not set up in a seating area (e.g. table-top liquor dispensing).

3 – Glassware in Stadiums: If a licensee is offering a “formal dinner” (which includes buffet dinners) they may now serve liquor in glassware. Previously they were required to use disposable containers. How fancy.

4 – Liquor price list requirements regarding taxes: Licensees are no longer required to specify, in the price list, whether or not taxes are included and what the applicable taxes are. Yawn.

5 – Liquor incident log: This has long been a concept referred to in Branch literature, but we now have prescribed types of incidents and information that should be logged, as follows:

When an incident occurs in or adjacent to an establishment or event site, the details must be recorded in an incident log. All incidents that adversely affect patrons, staff, people who live or work in adjacent buildings, or that affect the operation of the establishment must be recorded in the log and be available to inspectors or peace officers. 

Examples of these incidents include:

  • Refusing entry at the door to a potentially troublesome person or anyone who is causing a disturbance;
  • Refusing entry of an intoxicated person; 
  • Removing an intoxicated person; 
  • An injury or accident on the premises, including a fight;
  • Any incidents where emergency personnel were called (police, fire, or ambulance); 
  • Any illegal acts.

An incident report should include key details such as the date, time and description of events, the parties involved, any action taken, and any relevant sales records. Other details such as the names of the employees on shift and witness accounts are also important.

The records in an incident log must be kept for at least six years.

If a licensee or an employee becomes aware that a patron has brought unlawful liquor into the establishment or event, they must ask the patron to leave the establishment or event immediately. This must be reported in the incident log.

6 – Branded Refrigerators:  Retail stores are permitted to accept a maximum of two manufacturer brand-identified refrigerators of which the combined total size cannot exceed 38 cubic feet. Just remember LRS operators: ownership of the refrigerator must be retained by the manufacturer; and the manufacturer cannot pay for the installation or maintenance costs of the refrigerator(s).

Dan Coles and the other lawyers at Owen Bird have significant experience in the liquor law and hospitality sector. Please give us a call if we can be of assistance to your or your operations.

*Alcohol & Advocacy publishes articles for information purposes only. They are not a substitute for legal advice, and persons requiring such advice should consult legal counsel

Ikura Japanese Restaurant: Drinking, Driving and the Fit and Proper Analysis

Ikura, located on Granville Street in Vancouver, holds a food primary liquor licence. At issue in the hearing before the general manager’s delegate was the Liquor & Cannabis Regulation Branch’s allegation that the licensee was in substantial breach of the terms and conditions of its licence by permitting someone to act as “manager” who was expressly prohibited from doing so. The Branch considered this contravention to be so serious that it sought the cancellation of Ikura’s liquor licence.

You can read the enforcement hearing decision in full here on Canlii as part of the British Columbia Liquor & Cannabis Regulation Branch’s new enforcement hearing decision reporting and publishing initiative.

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Liquor & Cannabis Regulation Branch Enforcement Decisions now on CanLii

Big news for British Columbia’s hospitality industry: enforcement decisions of the general manager’s delegates from 2022 onwards are now available on CanLii!

Some time ago I participated in a short survey commissioned by the Branch canvassing views on how useful (searchable) the existing enforcement decision database is, and the merits of the Branch uploading its decisions to CanLii. I strongly supported this initiative. I came across this happy development earlier this week while perusing the compliance and enforcement section of the Liquor & Cannabis Regulation Branch website (as one does) and I confess I was surprised it was launched with so little fanfare.

Why this matters

Previously the only way to access enforcement decisions was through the search function on the Branch website. For the time being this remains the case for all pre-2022 decisions. I have never figured out how to work this feature effectively, but suffice to say its functionality is limited. The search results invariably yield a mishmash of waiver summaries and .pdfs of hearing decisions from various time periods.

Further, and for reasons that no one has ever been able to explain to me, enforcement decision .pdfs do not contain numbered paragraphs. This makes citing the decisions a frustrating task.

The Branch’s new CanLii initiative will cure these and other grumbles.

For the uninitiated, CanLii, or more properly the Canadian Legal Information Institute, was founded and is paid for by lawyers and notaries who are members of Canada’s provincial and territorial law societies. It is a free and very user friendly database of Canadian court decisions from all levels as well as legislation and an increasing number of administration tribunals – such as the BC Liquor and Cannabis Regulation Branch.

Branch decisions posted on CanLii will now be:

  • Highly searchable
  • Contain hyperlinks to both legislation and other decisions (of the tribunal and the court)
  • Indicate “treatment” (if the decision has been referred to in other tribunal decisions ,or by the court)
  • Contain numbered paragraphs
  • Eligible for “CanLii Connects” – summaries or commentary from the legal community available

Alcohol & Advocacy appreciates that enforcement hearing decisions have a relatively small audience. Nevertheless, the Branch’s decision to make enforcement decisions more accessible, more searchable, and generally easier to navigate will go some distance to improving the public’s understanding of its work, the quality of the submissions licensees are able to make before the tribunal, and ultimately the soundness of the general manager’s delegates decision making.

It is also worth mentioning that the Branch appears to be organizing and publishing waiver summaries in a new and more accessible format. This .pdf, which I anticipate will be updated from time-to-time, provides an easy to read summary of the licensees/establishments that have recently signed waivers with the contravention(s) and related penalty also set out. While there is absolutely a naming-and-shaming element to this document, which not all licensees will appreciate, the public has an interest in seeing the work product of liquor inspectors and the Branch set out in an accessible format.

The silver lining for savvy licensees is that the waiver summary provides a useful snapshot of the Branch’s enforcement priorities (by geography, licensee type, contravention type etc.) and the corresponding penalty.

If your establishment has been served with a contravention notice, or notice of enforcement action, or you have questions or concerns about liquor inspectors or the Branch generally, contact Dan Coles at Owen Bird.

*Alcohol & Advocacy publishes articles for information purposes only. They are not a substitute for legal advice, and persons requiring such advice should consult legal counsel.

Case to watch: Kirkland v. Attorney General of Alberta

Kyle Kirkland is a member of the Hells Angels Motorcycle Club.

Since at least 2016, spread over two different pieces of litigation (2016 court decisions outlining his first lawsuit can be read here and here, and a 2021 decision here) Mr. Kirkland has been seeking a declaration that several sections of Alberta’s Gaming, Liquor and Cannabis Act are unconstitutional, more specifically those sections that provide the police with powers to exclude and remove from licensed premises any person whom a police officer believes to be associated with a gang. The legislation came into force in October 2009.

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Alcohol & Advocacy Year in Review 2021

2021 proved to be another banner year for blink-and-you’ll-miss-it changes to the liquor law landscape. Alcohol & Advocacy frequently describes the liquor laws in British Columbia, and across Canada, as “dynamic” and that remains very much the case.

COVID continued to drive the bus as far as policy changes by the Liquor and Cannabis Regulation Branch are concerned. COVID was also responsible for certain, shall we say stubborn, licensees becoming “former licensees”. This year we also saw some notable names in the trade, Burrowing Owl and Fets Whisky Kitchen, involved in contested court applications that may result in a winery and some whisky changing hands – albeit in very different circumstances.

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BOOM CHAKALAKA: Ignoring COVID Orders in BC can cost you your liquor licence

Recent decisions published by the Supreme Court of British Columbia and the Liquor & Cannabis Regulation Branch indicate that across British Columbia liquor inspectors and environmental health officers (“EHOs“) have been busy monitoring food and beverage establishments for compliance with COVID related public health orders.

Establishments that refuse to comply risk losing their business and liquor licences in addition to stiff financial penalties.

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The Lobster Trap v. Registrar (Alcohol, Cannabis & Gaming)

In order to obtain (and renew) a licence to sell alcohol in British Columbia, the General Manager of the Liquor and Cannabis Regulation Branch must be satisfied that the individual or individuals applying for the licence are suitable – meaning that they are “fit and proper”. To assist the General Manager (and his or her delegates) in making this determination the Liquor Control and Licensing Act provides that the General Manager may make inquiries and conduct investigations, including background investigations and criminal record checks, for the purpose of informing the exercise of this discretion.

This is an important concept for existing and pending licensees to understand if they (or their business partners, investors, friends and family) have a history of criminality or otherwise unlawful behaviour – even if that conduct occurred in other provinces or countries. Alcohol & Advocacy has written about these concepts before in other contexts, and those articles can be found here and here.

A very recent decision of Ontario’s Licence Appeal Tribunal (“LAT“) involved an analysis of these very concerns. Although Ontario’s legislation and processes are a little different than British Columbia’s, the LAT’s treatment of issues relating to past criminality, accountability, and transparency during the licence application process are in the writer’s view instructive.

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Dhaliwall v. Hook Restaurant Ltd: earning sweaty equity in the restaurant industry

In July, 2021, following a four day trial, the Supreme Court of British Columbia released reasons for judgment in Dhaliwall v Hook Restaurant Ltd. The plaintiff Kayla Dhaliwall is a professional chef. The defendants were three restaurants in Vancouver: Hook, the Blind Sparrow and Bartholomew, where Ms. Dhaliwall acted as executive chef. The reasons for judgment can be read in full here.

At issue in Hook Restaurant was whether or not Ms. Dhaliwall and the defendants had reached a binding agreement with respect to her earning a “sweat equity” interest in the to-be-opened restaurant Bartholomew, and whether as a fall out from those negotiations (which the court found did not result in an enforceable agreement) she quit her employment with the defendants or was terminated.

Unfortunately oral agreements, never properly reduced to writing, are common in the hospitality sector. They are also notoriously difficult to enforce.

In Hook Restaurant the outcome turned largely on the court’s weighing and assessment of oral agreements and incomplete written records. The trial judge concluded that Ms. Dhaliwall and the defendants’ representative Mr. Gayman at best reached “an agreement to agree” on an ownership interest in Bartholomew which is not the same as an enforceable contract.

However, the court did find in Ms. Dhaliwall’s favour that she was wrongfully dismissed from her employment with the defendant restaurant group, who the judge found to be a common employer, and that she was entitled to damages in lieu of seven months’ reasonable notice. The court awarded Ms. Dhaliwall further compensation in the amount of $7,000 on account of contributions she made towards the eventual the opening of the Bartholomew restaurant. The facts of the dispute are summarized below.

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McLaughlin v. Cerda: Post-shift drinks and the duty to warn

On the evening of January 9, 2017, after finishing her serving shift at S&L Kitchen and Bar in Langley, Ms. Cerda remained in the restaurant to have a post-shift drink at the bar with several of her colleagues. Ms. Cerda and her co-workers, after finishing their drinks, had plans to travel to the newly opened S&L Abbotsford location (a related, but legally separate entity), where they had helped train the new staff, for dinner.

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