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Coles’ big South Rd bottle-o bid rejected

Mar 11, 2015

Corporate giant Coles has lost its bid to challenge rival Woolworths-owned Dan Murphy’s in Adelaide’s south by setting up a large-scale Liquorland bottle shop on South Road.

The liquor licence application for the prospective store at St Marys, just south of Daws Road, was opposed by Woolworths Ltd and by five hotels in the area: the Avoca Hotel, Castle Tavern, the Maid of Auckland, Marion Hotel and Tonsley Hotel.

According to Licensing Court Judge Brian Gilchrist, the store would have put small liquor stores attached to those hotels, and others in the relevant customer catchment area, at “very real risk” of closure.

The judgement says First Choice Liquor (owned by Coles) failed to prove that the market for takeaway alcohol in the area was being inadequately served by established liquor stores.

“Given the existence of a large format store in relatively close proximity to the proposed premises in this case there is a very real risk that over time the grant of this licence might result in the  closure of some of the takeaway facilities attached to some hotels in the locality,” the judgement says.

Gilchrist acknowledged the court was bound by law not to take into account the economic effect of licensees in the area affected by the application.

“But that does not mean that it must ignore the potential for the grant of a retail liquor merchant’s licence that is intended for a large format store to result in the public ultimately having less choice not more,” the judgement says.

Counsel for First Choice Liqour argued that customers in the primary catchment area of the proposed store – particularly St Marys, Clovelly Park, Mitchell Park and Daw Park – would have their “situation improved” by access to it.

They argued that customers in the primary catchment area had a lower-than-average car ownership rate and that they were required to travel further, and on congested roads, to access facilities capable of supplying an acceptable range of takeaway alcohol, at acceptable prices.

They also argued that, for customers in the secondary catchment area, to the south, “the range and prices offered by facilities in those areas are inadequate”, and that a large liquor store on South Road would be much more convenient to access than the Dan Murphy’s at Pasadena.

The site for the proposed Liquorland store from its realcommercial.com.au advert.

The site for the proposed Liquorland store, from its realcommercial.com.au ad.

But counsel for Woolworths argued that customers in the catchments areas were already well-served by established liquor stores.

They conceded that it “might be expected” that the proposed store “would present a far more convenient means of accessing takeaway liquor than the existing facilities”, but argued that was not enough for the application to succeed.

Both parties to the case produced expert testimony to back slightly different definitions of the customer catchment area.

In considering the case, the court inspected liquor stores in the area it considered relevant and received responses from residents and business owners.

Most of the residents in the catchment area who provided evidence to the court expressed positive opinions about the prospect of a new store on South Road.

But counsel for Woolworths argued that “the evidence of the residents did not establish the existence of any discontent and that overall the evidence did not establish that a significant number of people were not being adequately catered for by the existing facilities”.

Judge Gilchrist accepted the evidence given by most of the residents about their experiences of buying liquor in the area and their opinion on the application, but said that two of the residents left the “firm impression” that they were exaggerating the inconvenience involved in accessing established liquor stores.

He said those living in Mitchell Park and Clovelly Park have “access to a range of takeaway liquor facilities that are of reasonable quality; that provides a reasonable range of liquor; and a reasonable level of service”.

“For them, it cannot be said that the existing premises do not adequately cater for their demand,” the judgement reads.

Gilchrist accepted that for those living in the southern parts of Flagstaff Hill, Aberfoyle Park, Blackwood and Coromandel Valley, the distances involved in accessing liquor stores are “bordering on the unreasonable”.

However, the judgement reads: “it is not as if the residents of Flagstaff Hill, Aberfoyle Park and the eastern suburbs Blackwood and Coromandel Valley have no access to takeaway liquor facilities close to their homes”.

Gilchrist said he struggled to see how the proposed store would be any better, in terms of reasonableness.

“In my view the evidence falls short of establishing that those who reside in the anticipated primary catchment area of the proposed premises are not adequately catered for by existing premises for their demand for liquor.”

Gilchrist ruled that the the application failed to prove current stores did not adequately meet demand.

He said that even if that test had been met, “I would exercise the Court’s very wide discretion under section 53 of the Act to refuse the application”.

AAP image: Julian Smith

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