The Gazette 1987

GAZETTE

JU LY/AUGUST

1987

Licensed Premises for Sale

In t h is ar t i c le I propose t o exami ne cer t a in l i cens i ng prob l ems wh i ch the general prac t i t i oner may encounter in a conveyanc i ng t r ansac t i on i nvo l v i ng a l i censed premi ses.

was " c o py licence furnished ordinary licence". Prior to the delivery and reply to the requisitions on title the solicitor for the vendor had furnished to the defendant a photostatic copy of the current licence. Shortly after the signing of the contract the plaintiff paid a special visit to the defendant/solicitor to warn him that he had been informed that there was no licence attaching to the premises or that there was something wrong with the licence. The defendant showed him the copy licence which he had received and reassured him that the premises were licensed. A few days later the plaintiff again voiced his fears concerning the licence but de f endant reiterated that assurance. In the course of his judgment the President stated: — " I am driven to the conclusion however that since the existence of a valid licence attached to these premises was a fundamental part of the reason why the plaintiff was purchasing them and since the plaintiff himself put this defendant on notice in a persistent fashion of a doubt existing concerning the validity of the licence that it was not a sufficient precaution for this defendant to take to rely on his knowledge of the factual situation or on the knowledge of the plaintiff of the trading, cus t om and habits of the premises. A f t er events established that a simple direct enquiry to the District Court office in Thurles which is the appropriate area for the premises licensed in Dundrum would have revealed that a licence was recorded at all material times as being what is known as a hotel licence. In my view in the particular circum- stances of this case and on the express warnings given such an enquiry was a necessary reasonable standard of pro- fessional skill and care on the part of this defendant. I

purchase of licensed premises owes a duty to his client to exercise care in relation to the identification of the type of licence attached to the premises and he also holds himself out as having adequate skill and knowledge properly to identify any restrictions attaching to that licence. Conse- quently , in the case of an 'hotel licence', he will not discharge his duty of care nor be aware of the restrictions by a mere sight of the licence.

The identification of, and restrictions attaching to, 'Hotel Licences' In general, a sight of the licence will indicate what is on offer — whether the licence is of a retail character, authorises sales both on and off the premises or off the premises only, covers intoxicating liquor generally or is restricted to certain liquors (beer or wine), or has any condition attached (six days or early closing). This is not so in the case of an 'hotel licence'. The Licensing (Ir.) Act, 1902, provided for the granting of a new licence in respect of an hotel "wh i ch expression shall refer to a house containing at least ten apart- ments set apart and used ex- clusively for the sleeping accommodation of travellers, and having no public bar for the sale of intoxicating liquors" (section 2, sub-section 2). The legislature did not draw a distinction either in substance or in desc r i p t i on between a licence granted to premises on the basis that they are an hotel and other premises to which a full on-licence is attached and the licence issued by the Revenue Commissioners is the same in form in both cases — "Publican's Licence (Ordinary)". The possibility that this state of affairs may give rise to confusion or misunderstanding is acknowl- edged to the extent that the following note appears on the back of the licence so issued: "This form of licence is used for both (1) public-house and (2) certain hotels licensed under Section 2(2) of the Licensing (Ireland) Act, 1902. These hotel licences are subject to certain restrictions which do not apply to public-houses." A solicitor who undertakes the legal business involved in the

by James V. Woods, B.L.

Duty of Care The duty to exercise care was considered in Taylor -v- Ryan and Jones, unreported judgment of Finlay P. delivered on 10 March 1983, and again in Kelly and Anor. -v- Crowley, unreported judgment of Murphy J. delivered on 5 March 1985. The cases concerned actions for negligence against solicitors acting for the purchasers of licensed premises. In both cases it did not emerge until after the sales had been completed that the licences had been granted on the grounds that the premises were hotels. In Taylor -v- Ryan the plaintiff intended to purchase a certain residential licensed public- house for one of his sons and having entered into a contract for that purpose he then instructed the second-named defendant to carry out the legal work concerning the purchase of the premises. The reply to a requisition requiring the vendor to specify the exact type of licence attached to the property

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