I'm beginning to wonder if the Paddington Bowling Club doesn't care whether it forfeits its registered club licence or not.
Last week, the Office of Liquor Gaming and Racing lodged 33 disciplinary complaints against the Club and is recommending that it loses its licence.
Some of the complaints are about maladministration and unsatisfactory accounting practices, but others are about a long term noise problem. Naively, I expected the noise to quieten after the complaints were lodged but I was wrong.
In a further complaint about her experiences since OLGR took action, a resident wrote:
The noise has been very bad for the last week – from late morning till closure on every day of the week. As you know it goes on seven days a week – no break for us at all. Rain does not seem to put the “players” off for too long – they are soon back on the greens with their screaming and shouting. Children are allowed to run and play in the rain – why are they even allowed on the greens around liquor consumption and smoking?
Photos have been taken of men urinating in the street outside the Club during the day.
Read further before you discard the noise issue as a trivial matter not worthy of your sympathy or attention.
Once a community bowling club,'Paddo Bowls, without the olds', as it now advertises itself, turned into a raucous venue for barefoot bowling in 2004. Barefoot bowling is fun but at this venue, it often involves heaps of alcohol, making it a popular choice for busloads of party goers and corporate groups.
I'll admit that when I first started investigating the Paddington Bowling Club development scandal, I didn't devote much attention to the noise aspects of the story. Living in the Inner West, I'm used to the odd loud party, street buzz, traffic and aircraft noise. I was more interested in explaining how the Club's Crown lease to prime land in Paddington got transferred to private developer CSKS Holdings. CSKS Holdings, which was then part of the development business of Michael Sanchez, had been trying to gain control of the land since 2004. After he went bankrupt in 2011, his son Christian took over the company. In 2011, the Crown Land Department agreed to transfer the lease from the Club to CSKS Holdings. Christian Sanchez then applied to build a large for-profit childcare centre on two tennis courts which are part of the Paddington Bowling Club site. The development application has now stalled as the NSW Independent Commission against Corruption and the Department of Land and Investment investigate the dealings which led to the lease transfer.
Paddington Bowling Club's noise problem
The Paddington Bowling Club's noise problem turned out to be very different from anything I had experienced. The club lies at the top of Trumper Park directly below Goodwin Village, a large housing complex for elderly residents. Some of these residents have balconies that provide a view across Trumper Park to the city. Unfortunately, the residents often can't use the balconies as the club forms a natural amphitheatre or funnel for noise. By noise, I mean very loud noise, involving scores of people, which often begins around mid morning and continues until late evening, several days a week. Recently residents have also been woken up to the noise of gym classes run in the Club early in the morning.
If this was happening to you and it disturbed your sleep and use of your home, you would probably complain. This is just what the residents have done. For years, those living in the Village and neighbours in nearby streets have complained to the local police and Woollahra Council.
The Office of Liquor, Gaming and Racing took action to control the noise from drinking outside the clubhouse. Conditions were imposed on the licence but had little long term effect. A couple of residents have even complained about intimidating 'visits' from people associated with the Club, which appeared to have been given their personal details by police.
Greenwich defends residents
Clover Moore, who was the local State MP and is now the Lord Mayor of Sydney, made representations on behalf of residents.
In 2010, police lodged more noise complaints against the Club. Further conditions were attached to the Club licence. The Club also paid for some residents to have noise reduction material attached to their windows.
In 2011, Moore was succeeded by Alex Greenwich who again pursued the residents' complaints. In early 2012, he received a letter from the local police defending the club and informing him that the Club was doing its best to comply with licence conditions.
He organised a meeting between Goodwin Village residents, local police and OLGR officials earlier this year after he received complaints that organised events on the greens were becoming more frequent.
Some residents say that they will not make complaints and the police officers have not taken complaints seriously, or have provided their names and contact information to the operators. Some report being verbally threatened and are fearful about retribution if they raise their concerns. I am concerned that some elderly Goodwin Village residents feel vulnerable and are unwilling to make formal complaints
Finally the OLGR started a serious investigation including undercover surveillance and testing of noise. Investigators also attended an Annual General Meeting which was two years overdue and removed records from the Club. The Australian Securities and Investment Commission required the Club to file its overdue financial accounts, which are supposed to be updated regularly and be available to members.
The OLGR has now referred the complaints to the Independent Liquor and Gaming Authority ( ILGA) which will investigate the complaints.
The is the second time the Club has been investigated by the Independent Liquor & Gaming Authority (ILGA). In 2007, a Commission of Inquiry found that large salaries were being paid to relatives of Sanchez, one of whom was also the secretary of the Club. It also found that members of the Sanchez family were involved in a bistro supplying food to the Club without any written contract or proper accounting of how proceeds were to be distributed. No action was taken against the Club or any of its officials or employees after the report, which was never tabled in parliament, was completed. The results of the Inquiry were first reported on this blog this year.
Developer Michael Sanchez told me earlier this year that the 2007 Inquiry was an expensive and “utterly fruitless exercise” that showed “the Club as being run immaculately” and provided a template for how clubs should be run in NSW. He dismissed any further questioning of the Club’s administration, including its failure to file annual reports, as simply “an attempt to stir up mud”.
In October this year, Alex Greenwich wrote to the NSW Minister for Hospitality, Gaming and Racing Troy Grant expressing concern about screaming and yelling and intrusive music.
Finally last week, the OLGR was ready to launch its action. The 33 grounds of complaint relate not just to noise but also to breaches of registered club, gaming machine and liquor laws, including complaints against nine individuals.
The OLGR alleges the Club "has failed to be conducted in good faith" and "has not been operating in accordance with its objects or requirements set out in the Registered Clubs Act."
It is also asking whether some past and present office holders should be declared ineligible to stand for election, or to be appointed to, or to hold office in, a governing body of any registered club for up to three years.
The ILGA is an independent administrative body rather than a court. It does not have to use the rules of evidence but must proceed with 'natural justice' and fairness. Those responding to complaints have the opportunity to make written submissions and the right to appeal to the Administrative Decisions Tribunal.
The ILGA has refused to release the names of the individuals until the complaint is considered by the Authority.
One of them will certainly be Brian Kirk who was President of the Club for ten years until he resigned earlier this year. He is a close associate of the Sanchez family and their planner for the proposed development. He was also heavily involved in negotiations to transfer the land with the Crown Land department and the Labor Minister for Lands Tony Kelly.
When I briefly interviewed Kirk in February this year, I asked him why the Club had filed no accounts for three years. He admitted that, "we've been a bit tardy". But he did not see it as a major difficulty and said that the Club was getting "on top of the matter."
Club Secretary Robert Ashton was unable to provide information about the management of the Club, telling me that I would need to speak to Kirk.
For eight years the Club was under the administration of well known Sydney liquidator Andrew Wily. Wily was involved in the organising and signing the transfer of the Club lease.
ASIC told Federal Parliament last month that it had "an investigation under way in relation to Mr Wily", who was suspended for four months in 2003 by the Companies Auditors and Liquidators Disciplinary Board for breaching his duties as a liquidator.
Wily has recently been mentioned in an SMH investigation into Timbercorp. He has denied any involvement in an alleged fraud on investors.
The Club stayed in administration for an unusually long time. It was not until after the land was finally transferred to the CSKS Holdings that Wily, a business friend of the Sanchez family, took the Club out of administration. Since then, Wily has had no role in the running of the Club.
Victory for community says Greenwich
Last week, Greenwich welcomed the decision as vindicating "longstanding community concerns about the Club’s arrangements with commercial operators.
I congratulate all those who have been raising concerns for many years about how Crown land leased to a non-profit club was being used for significant private benefit. The OLGR request includes action against some club directors as well as fines and licence cancellation – this is a serious step. If ILGA supports the request, the community will want the land returned for public benefit. Neighbouring residents would also have their amenity returned.”
What future for the Club site?
When it first became involved with the Paddington Bowling Club site more than a decade ago, the Sanchez family hoped to build high rise apartments on the whole of the Club site. But when that turned out to be impossible, they considered the possibility of building a convention centre. The 2007 Inquiry and other problems with their Paddington plans came at the same time as other business disappointments. After several other failed developments, Michael and Christian Sanchez wound up their family company Benchmark and Michael Sanchez senior declared himself bankrupt. Christian Sanchez is now the sole shareholder in CSKS Holdings.
In 2011, the NSW government finally gave permission for the lease to be transferred to CSKS Holdings. Christian Sanchez lodged his application to build the 'for profit' childcare centre.
This development application is now suspended while ICAC and the Department of Trade and Investment deal with the findings of an external review of the circumstances in which the company was granted the lease. After receiving the review report, the Head of the Department Mark Paterson wrote to Woollahra Council and local residents' group Friends of Quarry Street informing them that had the Department known what it now knows when it granted the lease to CSKS Holdings, it might not have transferred the lease to the company. Paterson referred the results of the review to ICAC.
Meanwhile, the Sanchez family continues to receive rent from the Club. Sanchez currently pays the Crown $50,000 a year rent for the site. He receives at least $100,000 rent by subleasing to the Club and to Palm Courts Tennis. If the Club loses its licence, it will close and no longer pay its rent. From one point of view, it could suit CSKS Holdings if the Club ceased operation as that might provide the company with an opportunity to pursue further development applications, although these would have to be consistent with the Open Space zoning.
CSKS Holdings is also at risk of losing the lease, not only because of the inquiry into possible corruption or irregularity but because the ongoing noise problem, which has been a feature of the Paddington Bowling Club for a decade, could also be argued to be a breach of the Crown lease. If a lessee creates an ongoing 'nuisance', it can forfeit a lease.
The failure of CSKS Holdings to comply with this and other clauses in its lease has been pointed out to the Crown Land department on several occasions by the Friends of Quarry Street group. So far the Department has not taken any action against CSKS Holdings. Under its lease, CSKS Holdings is also responsible for breaches of the Liquor Act.
If the Club was to close and the Sanchez lost or decided to forfeit his lease, the Crown would take possession of the Crown land which is dedicated to public recreation.
One possibility is that Woollahra Council could then be invited to lease the land and incorporate it into Trumper Park, which it already manages. This would provide a park for the elderly residents, some of whom find it difficult to access the adjacent steep slopes of Trumper Park.
It has been suggested by some that Woollahra Council could not afford to pay the Crown its $50,000 annual rent. But why couldn't the Council continue to sub-let the courts to Palms Tennis Courts, the tennis business to which the Council already rents other nearby courts? This would cover the $50,000 which CSKS Holdings is currently paying the Crown. The Council could then absorb the land on which the Club now sits into Trumper Park.
Friends of Quarry Street's long term goal is for the land to be returned to the community for a park. Could what seemed like an impossible dream at the beginning of 2014, yet become a possibility in 2015?