I googled the exact phrase and most of the hits are German-teaching sites. I think it's one of those typical 'German-course-for-foreigners' phrases that no native speaker actually uses. I'm a native speaker myself and I've never heard anyone ask the time like that. That said, it's apparently not wrong like I initially thought.
"Haben/haetten Sie die Zeit?" is also common where I lived, but I'm pretty sure that's just local vernacular.
there is a great scene in Casablanca. 3 Germans, one fluent in English, two learners, husband and wife. Husband says, since we are moving to America, we speak nothing but English.
His wife then asks (all this in English) Her: What Watch? Him (after looking at his pocket watch): 9 Watch
No. I'm a German nativ speaker and I can assure you this is no "book phrase", bute exactly what you will hear everywhere in Germany (either "wie spät ist es" or "wieviel Uhr ist es"). "Haben/haetten Sie die Zeit" can be met at some locations, but ass you already guessed,this is really local.
When I studied German in the late 80's, it was "Wie viel Uhr ist es".
I was in Germany about 5 years back, and I asked a native speaker how to ask for the time, and his reply was "Wie viel Uhr ist es?"...
I had to ask, because for some reason, I was planting "um" at the beginning and getting funny looks. I had been a long time since I had even attempted to use German. Anyway, if I understand/remember correctly, this can be translated "at which time is it"; or in other words "when (at what time) does something start".