Municipality in liquor licence transfer debacle

CONFUSION over the terms of a lease in the small boat harbour has resulted in the Ward 10 committee recommending that a liquor licence transfer application be declined.

The decision was made at the most recent Ward 10 committee meeting, where after input from Ndlambe town planning, the committee recommended that an application to transfer the licence from Barnacles Trust to Funky Ripple (Pty) Ltd be declined.

A QUESTION OF RIGHTS: There is an issue over the liquor licence being transferred to the new tenants of the old Spur building

Funky Ripple trading as Tash’s Craft Bar is the new tenant at the old Spur building. The liquor licence has been held in the name of Barnacles Trust by the lessee of the property, Halyards Properties, of which Stuart Boucher is a director.

It was not clear where the opposition to transfer had originated, as there appeared to be an outside objector, but in response to TotT’s queries, municipal spokesman Cecil Mbolekwa said it was the town planning department itself that had objected.

The municipality owns the land, which is on long lease to Halyards Properties since 1993, after the original lessee Pamcor indicated its desire to sublease the property to Boucher’s company, along with all rights and obligations, with some exceptions – including the provision and maintenance of fuelling facilities and swimming pools.

Answering on behalf of town planner Ntombi Ngxwashula, Mbolekwa said: “The reason for the objection was solely based on the fact that council did not give their consent/ were never requested to give their consent as the legal owners of the land and as set out in the lease agreements.”

Acknowledging the sublease with Halyards Properties, Mbolekwa said there had been long outstanding matters in terms of the rights and obligations of the sublease and other issues relating to the property.

“Numerous letters have been sent in an attempt to resolve this matter, however, that has been unsuccessful,” he said. “It is very clear in the lease agreements that the municipality entered, that written consent from the municipality must be received by the lessee before they can sublet the property.”

Mbolekwa cited the clause: “The lessee shall not be entitled to sell, cede, assign or make over the lessee’s rights and obligations in terms hereof without the lessor’s prior written consent.”

This particular clause (clause 18 of the original lease with Pamcor) was one of the provisions excluded from the lease agreement with Halyards properties, but it is repeated in 6.2.

Approached for comment, Boucher said he was perplexed that the municipality had focused on the latter part of 6.2 while overlooking the beginning of that clause, which states: “The lessee shall have the right to sub-let the marine services area, the public bar area, and the restaurant/tearoom area [the old Spur building] on the said land, to any sub-tenants of their choice, but only for the purpose of establishing and maintaining a marine service, a pub and a restaurant/tearoom, unless otherwise agreed to by the lessor.”

“I don’t have to ask their consent,” he said.

Boucher also provided TotT with a legal opinion from senior counsel on the lease agreement. On that particular clause the legal opinion states: “The only interesting question of interpretation is what role the written consent of the lessor (the municipality) has in this clause. The sentence incorporating the requirement of written consent appears to be disjunctive to what precedes. The right to sub-let is ‘to any sub-tenants of their choice’. The following ‘unless otherwise agreed to by the lessor’ does not, in my view, qualify the choice of sub-tenant but limits the variation of the use of the areas.”

Boucher said he had already renewed the Barnacles Trust liquor licence and the application to transfer to Funky Ripple had been lodged with the Eastern Cape Liquor Board, which makes the final decision.