The owner of a popular Eat Streat watering hole has three months to sell his bar or close his doors permanently after he lost his liquor licence.

Scotty's Bar owner Scott Toner appeared before the Rotorua District Licensing Committee (DLC) last month to apply for renewal of his bar's on-licence under the Sale and Supply of Alcohol Act 2012.

However, due to a number of issues, including selling alcohol to underage patrons, Mr Toner's application was refused. The popular bar's liquor licence will expire on March 15, effectively giving Mr Toner until that date to sell it, or shut up shop.

In the decision Chief Licensing Inspector Julie Smale questioned Mr Toner's suitability for running a bar.

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"As far back as Mr Toner's first renewal in 2008, and indeed to this application, there have been issues with paper work in terms of the legislative requirements. Mr Toner himself has been the subject of the cancellation of his manager's certificate and in the last 12 months there have been two failed controlled purchase operations."

Ms Smale said in her evidence to the committee that Mr Toner had also failed to send any bi-monthly reports, as per a condition of his previous licence renewal.

"Mr Toner has failed to demonstrate to this committee that he understands his responsibilities as a licensee," the committee's decision stated.

"Unfortunately, there appears to be a systemic failure on the part of Mr Toner to implement systems and change his management style, he continues to display a blase attitude and lack of concern about his responsibilities.

"The committee does not believe Mr Toner is able to balance the burdens and benefits of holding a liquor licence.

"Therefore the committee does not believe Mr Toner is a suitable person ... to hold a liquor licence and the application for an on-licence is refused."

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Mr Toner's advocate at the hearing, Hospitality New Zealand regional manager Alan Sciascia, said Mr Toner acknowledged that "some undertakings given to the DLC in May 2015 have not been totally met".

Mr Toner told the Rotorua Daily Post he did not wish to respond directly to comments made by the committee in its decision.

"It's been a great eight years on Eat Streat. It's been a blast. We've had our ups and downs, but it's been a lot of fun."

He said there was someone lined up to buy the business.