The premises was charged with three breaches of the Sale and Supply of Alcohol Act - allowing people to become intoxicated on the premises; allowing an intoxicated person to remain there; and allowing disorderly behaviour to take place, all on January 15 this year.
At an Alcohol Regulatory and Licensing Authority hearing last month, the company admitted the second breach, but the authority found police had not proved the other breaches.
After the cancellation of a concert in Queenstown that day, several people went to Graze for dinner and drinks.
About 10pm, a group of 10 local residents arrived and entered the bar and restaurant area.
Simultaneously, a group from Mataura, who had been drinking in Queenstown, arrived to join a birthday function. Most of that group stayed outside on a patio.
The decision said about half an hour later, after a ''commotion'', a man had ''fallen down a bank ... and suffered a serious head injury''.
It had never been established whether the man had tripped or was pushed.
Owner Hamish MacPherson, who had been called in to help due to the business being short-staffed, helped the man and called emergency services.
When police arrived they found an intoxicated woman outside the premises, while the injured man and his associate were assessed as being intoxicated at the hospital.
In its decision, the authority said manager Daniel Cook had put the injured patron and his associate on to water about an hour before the incident, so while police established they had been served alcohol, it had not been established that they had been allowed to become intoxicated.
There was also ''no evidence'' the intoxicated woman had been served alcohol at Graze, or allowed to become intoxicated there.
While the respondents acknowledged the incident that night had been a form of disorderly behaviour, nothing put before the authority established that once aware of it, they allowed it to continue.
A second ground of the application, based on a neighbour's complaint about alleged noise and intoxication on January 23, was also not proved.
LHE, through counsel Tanya Surrey, had sought to have the matter adjourned to enable the licensee to remedy any matters required.
However, the authority said the company had proactively taken measures since the incident including erecting a railing fence and imposing controls on patrons, had been co-operative with police and there had been no incidents since.
''In this regard, the authority considers that the respondents have done what they can after the fact ... there is nothing more to rectify, per se, to warrant an adjournment.''
Graze's on-licence will be suspended for 24 hours from 8am on October 14, while Mr Cook's manager's certificate will be suspended for 28 days from the same date.
