A Dunedin District Licensing Committee yesterday gave its decision after recent hearings in which owner Sam Chin admitted he had been "pretty slack", and had not managed the venue properly.
The decision said the committee, which had given Mr Chin plenty of opportunities to comply, had no option but to find him unsuitable to hold a licence.
Mr Chin responded yesterday he was considering appealing the decision.
He said: "The authorities are right, I have been slack.
"But now I know how bad it is, I’ll get things back in order, hopefully."
The Crawford St venue has been owned and operated by the Chin family for 32 years.
In the decision the committee said it had "no confidence that the applicant is capable of making the necessary changes to make the premises compliant with the [Sale and Supply of Alcohol] Act."
Despite promises from Mr Chin in April to run the premises in accordance with the Act, a series of transgressions were identified at a Katchafire concert last month.
It followed a series of issues with the venue and its compliance, and Mr Chin’s understanding of the requirements of the Act.
"The committee is aware of the need for the city to have venues such as this available for large events and functions," committee secretary Kevin Mechen said.
"Unfortunately, for it to be successful and fulfil the needs of the community, the licensee needs to understand his obligations under the Act and to demonstrate to the reporting agencies, and this committee, that he has that understanding.
"Mr Chin has been given more opportunities than most to get his business in order."
The agencies, including police and the Southern District Health Board, emphasised at a hearing in April Mr Chin would be given three months to put in place appropriate processes.
"Unfortunately he still has not made the changes expected of him."
The committee said the venue remained suitable for functions and could continue to operate by way of a special licence, with each application being assessed on its merits.
Mr Chin could appeal the decision, and had 10 working days to do so.
Mr Chin said he still wanted to run Sammy’s as a club.
"I think Dunedin needs a venue like that. Whether I run it or somebody else runs it, I think it will still be going."
But he said if someone bought the building, which was on the market, and turned it into something different like a restaurant "that would be good".
"Even the DCC (Dunedin City Council) might want to take it over.
"It’s been part of the city for the last 32 years. It would be a shame if it turned into a car park."
He would talk to legal advisers about the possibility of an appeal against the decision.
Committee chairman Colin Weatherall said when a special licence was applied for, police, liquor licensing and health agencies had rights to raise their points of view.
Special licences were available for people with a licence who would run the venue responsibly.
