England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT

		Royal Courts of Justice The Strand London WC2A 2LL
		31 August 2007

Friday 31 August 2007

MR JUSTICE SULLIVAN:

1. This is an application for judicial review of a decision by the defendant's licensing panel sitting on 16 February 2007 that the claimant was not an interested party for the purposes of the Licensing Act 2000 in respect of an application that had been submitted by the second defendant for a new premises licence to the first defendant.
2. The application was submitted on 21 December 2006. Both the claimant and the third defendant made representations in effect objecting to the application.
3. The relevant provisions of the Licensing Act 2003 ("the 2003 Act") are as follows. Where an application has been received by the relevant licensing authority (in this case the first defendant) then where "relevant representations" are made, the authority must hold a hearing to consider them, unless the authority, the applicant and everyone who has made representations has agreed that a hearing is unnecessary: see section 18(3).
4. "Relevant representations" are defined in section 18(6). For present purposes only one aspect of the definition is relevant, that is to say the requirement in paragraph (b) that the representations meet the requirements of subsection (7). Among the requirements in subsection (7) are those contained in paragraph (a), namely that the representations were made by an interested party or responsible authority within the prescribed period.
5. "Interested party" is defined in section 13(3) of the Act as follows:

"'Interested party' means any of the following --

(a) a person living in the vicinity of the premises,

(b) a body representing persons who live in that vicinity,

(c) a person involved in a business in that vicinity,

(d) a body representing persons involved in such businesses."

6. At the outset of the licensing panel's sitting on 16 February 2007 the second defendant questioned whether both the claimant and the third defendant were interested parties on the basis that they were not businesses "in the vicinity" of the application premises. That matter was considered by the panel as a preliminary point because if neither of those companies was found to be an interested party then there would not be any relevant representation before the panel and so there would not be any requirement to hold a hearing. The panel heard representations from the parties and then went into private session to consider the representations. There is a manuscript note; it is not a full transcript but it suffices for present purposes of what occurred at the hearing. The applicant for the licence (the second defendant) first put its position. The committee were told that the Act did not define what was meant by "in the vicinity". They were told that it was down to the individual committee to decide that issue. They were referred to certain government guidance, to which I will refer in due course, and it was submitted that the claimant's club, the Syndicate Club, was "some considerable distance away", whereas the second defendant's club, Sanuk, was approximately 250 yards away from the application site. Submissions were then made on behalf of both the claimant and the third defendant, who were represented by Mr Martin Walsh of counsel who appeared on behalf of the claimant before me. He told the committee how long it took him to walk to the Syndicate night club and how long it took to walk to the Sanuk club. He referred the committee to the licensing objectives. He made the point that the application was for a dramatic increase in capacity at a sensitive area of the town, and he specifically referred the panel to the fact that a saturation policy had by that stage been introduced. He referred to the size of the proposed venture and to various other characteristics of it, and contended that the two clubs, Syndicate and Sanuk, were for those reasons within the vicinity of the application site. There was then a short response on behalf of the second defendant.
7. Having considered those representations in private session, the panel then announced their decision. The decision is explained in these terms in a witness statement by Councillor Mitchell, who was a member of the panel:

"6. Blackpool Council's Statement of Licensing Policy does not aim to set a limit on how near an individual/business should be to qualify as an interested party. Each application is dealt with on its merits. The premises operated by Worldwide Clubs UK Ltd (Sanuk) were a matter of 250 yards away. We considered that this premises was close enough to the premises subject of the application to be affected by the licensable activities. Therefore we decided that Worldwide Clubs UK Limited was an interested party and that representation was relevant.

7. When considering whether 4 Wins Leisure was an interested party, we took into account from our knowledge of Blackpool, the distance between the premises they operate (the Syndicate) and the premises subject of the application. We were of the opinion that they were some considerable distance apart and that the Syndicate would not be directly affected by activities taking place at Talbot Road. As a result we decided that 4 Wins Leisure were not an interested party in this case, therefore their representations would not be taken into account."

8. Whether or not one premises can sensibly be said to be in the vicinity of another must be very much a question of fact and degree. Moreover, it is a question that is highly dependent upon local knowledge. That, no doubt, is why the question was left for local licensing committees to determine. It would only be in very unusual circumstances that this court, never having seen the site and being wholly unfamiliar with the area in question, would be able to say that such a judgmental conclusion of a local committee was unlawful on the ground of being irrational.
9. The grounds of challenge to the committee's decision were twofold: first, there was a straightforward irrationality challenge; but secondly, it was contended that the panel failed to take into consideration material factors, namely, (a) the substantial nature of the premises which were the subject of the application for a licence; (b) the size of the claimant's premises (the club is a very substantial club and therefore likely to be affected by the activities of the proposed club); and (c) the fact that the two premises, that which is the subject of the licence and the claimant's premises, were both within what subsequently became the town centre saturation area. Very briefly, as at the date of the application the defendant council had no defined saturation area within which a saturation area policy operated. In the policy it is said:

"The Licensing Authority recognises that the Town Centre and the Promenade are areas where the behaviour of the customers of all the premises taken together has a greater impact than normal. The Authority anticipates representations from a Responsible Authority or interested party that new licences in these locations will, having regard to the cumulative impact, prejudice the promotion of the licensing objectives".

10. By the time the application came to be considered on 16 February 2007, a revision to the policy had been adopted which did not apply to applications that had been submitted earlier, including the application in issue in the present case, but nevertheless, the defendant authority had adopted a specific saturation area policy wherein cumulative impact would be taken into account. The relevant part of the policy is in these terms:

"The licensing authority has for some years recognised that the town centre and promenade area identified in appendix A is an area where the behaviour of customers of all the premises taken together has a greater impact than normal on the crime and disorder objective. The licensing authority is now of the opinion that this area is suffering from cumulative impact, and designates it as the Town Centre Saturation Area in respect of premises licensed for the sale or supply of alcohol. In reaching this decision, the evidence summarised in appendix B was taken into account."

11. The area is defined by a red line on the plan Appendix A. The application site adjoins the promenade on the western side of the area, whereas the claimant's site is on the opposite side, the eastern side, close to the eastern boundary of the saturation area. Dealing firstly with the contention that there was a failure to take into consideration these matters, since the committee specifically heard the claimant's representations and retired to consider them, it would be very difficult to conclude that they failed to take them into account. The fact that not every point made on behalf of the claimant is dealt with in the reasons given in Councillor Mitchell's witness statement does not demonstrate that the panel, having listened to representations, simply failed to take them into account. This is not a case where reasons are required. The committee has provided reasons in a witness statement, but those reasons need only contain the points that the panel themselves thought of particular significance. At one stage Mr Walsh complained that the committee had failed to pay sufficient regard or attach sufficient importance to those factors because they had not specifically mentioned them in the witness statement, but it is well established that the weight to be given to various factors on the assumption that they are relevant is very much a matter for the deciding authority to determine. An argument that someone has given insufficient weight to a factor does not raise a point of law. It seems to me on the evidence that it is quite impossible to say that the committee failed to have regard to any relevant factor or that it had regard to any irrelevant factor. In truth the challenge is a straightforward Wednesbury challenge. Mr Walsh faces a very high hurdle in that respect. He has to persuade the court that no reasonable licensing panel with the local knowledge that this licensing panel had could have concluded that the two premises were not in the same vicinity.
12. The panel were advised of the walking distances. They knew of their own local knowledge how far apart the premises were. On a plan provided for this hearing the distance is given (as the crow flies) at 816 metres. That, of course, is not the test in deciding whether or not one property is in the vicinity of another. One is not simply concerned with a mechanical measurement as the crow flies. Regard must be had to local circumstances. Thus, for example, Property A may not be in the vicinity of Property B if, even though it is not very far distant from Property B, the two properties are separated, for example, by a river, by a major road or by a railway. Conversely, Properties A and B may be quite some distance apart; but given particular geographical considerations they may be said to be in the same vicinity if, for example, there are very strong linkages between them, as there might be (and it would be entirely a matter of fact for the panel to determine) in respect of properties at opposite ends of the promenade in Blackpool.
13. Here it cannot be said, where two properties are 816 metres apart, as the crow flies, that a committee with local knowledge could not conclude that these two properties were not in the same vicinity.
14. Mr Walsh referred to the Guidance from the Secretary of State which is issued under section 182 of the Act and to which licensing authorities must have regard. The relevant parts of the Guidance which were in force at the date the decision under challenge was taken are as follows:

"5.33 It is for the licensing authority to determine in the first instance whether or not representations are relevant representations. This may involve determining whether they have, as a matter of fact, been made by an interested party and whether or not, for example, an individual making a representation resides or is involved in business 'in the vicinity' of the premises concerned. However, licensing authorities should be aware that their initial decision on this issue could be subject to legal challenge in the courts. Whether or not an individual resides 'in the vicinity of' the licensed premises is ultimately a matter of fact to be decided by the courts but initially licensing authorities must decide if the individual or body making a representation qualifies as an interested party. In making their initial decision, licensing authorities should consider, for example, whether the individual's residence or business is likely to be directly affected by disorder and disturbance occurring or potentially occurring on those premises or immediately outside the premises. Where a representation concerns 'cumulative impact', the licensing authority may be unable to consider this factor and would probably need to examine issues such as the proximity of the residence or business. In essence, it is expected that the decision will be approached with common sense and individuals living and working in the neighbourhood or area immediately surrounding the premises will be able to make representations."

15. There are two points to be made about that guidance. First of all, whether or not an individual resides "in the vicinity" of the licensed premises is ultimately a matter of fact to be decided not by the courts but by the licensing authority with the benefit of its own local knowledge. It is for the courts then to decide whether there is any error of law in that factual decision by the authority. Secondly, it is importance to remember that, whilst regard must be had to the guidance, it should not be allowed to usurp the clear language in the statute. The test in the statute is not whether an individual's residence or business is likely to be directly affected in some way, but whether the person is living in the vicinity of the premises or whether the business is in that vicinity. In deciding those questions it may be helpful to consider whether or not there is some direct effect on the individual's residence or business, but it must be borne in mind that that is not the statutory test. Whether it should be the statutory test is quite another matter.
16. The Guidance has been amended. The new Guidance which came into force on 28 June 2007 corrects the first of the errors to which I referred. At paragraph 9.4 it says:

"It is for the licensing authority to decide in the first instance whether or not representations are relevant. This may involve determining whether they have been made by an interested party and whether or not, for example, an individual making a representation resides or is involved in business 'in the vicinity' of the premises concerned. However, licensing authorities should be aware that their initial decision on this issue could be subject to legal challenge in the courts."

Pausing there, that challenge would be made on conventional judicial review principles and it would have to be borne in mind that whether or not a business is "in the vicinity" of an application site is very much a question of judgment on which reasonable people may differ in their views. Thus any challenge on Wednesbury grounds will be a very difficult road to pursue. The revised Guidance continues:

"9.5 In making their initial decision on the question of vicinity, licensing authorities should consider whether the individual's residence or business is likely to be directly affected by disorder and disturbance occurring or potentially occurring on those premises or immediately outside the premises. In other words, it is the impact of issues relating to the four licensing objectives that is the key consideration."

Those four objectives are the prevention of crime and disorder, public safety, the prevention of public nuisance and the protection of children from harm. I repeat, while the question of direct effect may be of assistance in deciding whether or not one premises is in the vicinity of another, it not the statutory test that must be applied.

17. The Guidance continues:

"9.6 The Government recommends that, where local authorities have chosen to define vicinity as a fixed distance from a premises, they should only ever use this as a guideline and should indicate in their policy statements that they will consider representations from those who live or work outside that distance if they can demonstrate that they are (or, in the case of new premises, are likely to be), affected by disorder and disturbance occurring (or potentially occurring) on those premises.

9.7 Where a representation concerns 'cumulative impact', the licensing authority may be unable to consider this factor and would probably need to examine issues such as the proximity of the residence or business. In essence, it is expected that the decision will be approached with common sense and individuals living and working in the neighbourhood or area immediately surrounding the premises will be able to make representations."

Insofar as that advice recognises that the question whether something is in the vicinity of something else is essentially a matter of their physical or geographical relationship, then I would endorse it. Insofar as it seeks to go further and to introduce other considerations such as whether or not the premises are likely to be affected by disorder and disturbance, then again while those might or might not be helpful indications, they should not be used as a substitute for the statutory test.

18. On behalf of the claimants, Mr Walsh submitted that such a "narrow" geographical approach to the meaning of "in the vicinity" would drive a coach and horses through the Act because it would mean that representations from businesses which might have a very real contribution in terms of assisting the licensing authority to see whether or not the licensing objectives would or would not be promoted by the application would not be treated as interested parties. I can well see that there may well be very good arguments for submitting that those who could make a useful contribution to that question should be allowed to be heard by the licensing authority. The difficulty is that it treats an interested party as though that term were not constrained by the further definition in section 13(3). There can be no doubt that, as another major club operator in Blackpool, the claimant is an interested party in the second defendant's application. Equally, for the purposes of a judicial review application, it would be said to have a "sufficient interest". But, for whatever reason, that was not the test that was imposed by Parliament when enacting the 2003 Act and in particular when defining "interested party" in the manner set out in section 13(3).
19. Mr Walsh drew the court's attention to the way in which "interested parties" had been defined in the Gambling Act 2005. In many ways that Act replicates the features of the 2003 Act, enabling representations to be made by interested parties to the relevant authority. Under the 2005 Act an interested party is defined as a person who "(a) lives sufficiently close to the premises to be likely to be affected by the authorised activities, (b) has business interests that might be affected by the authorised activities...." Thus the focus is clearly not on whether or not premises are "in the vicinity" of other premises, but what the effects of the activities in those premises are likely to be. The contrast between the 2003 Act and the 2005 Act is very obvious in the case of businesses because section 13(3)(c) of the 2003 Act defines an "interested party" not as a business where the business interests might be affected by the authorised activities, but as a business in the vicinity of the premises. Thus one might have a business which was wholly unrelated to the proposed application and which indeed would not be affected by it. But, nevertheless, if it was in the vicinity it would be an interested party. Consideration would have to be given to whether or not the representations made by such a business were frivolous or vexatious: see section 18(7)(c), but that does not alter the fact that a business which on the face of it would have no business interests that might be affected can nevertheless be an interested party for the purposes of the 2003 Act. Conversely, one may have a business which has business interests that might indeed be affected, but if that business is not "in the vicinity" then, regardless of the impact on those business interests, it is not an interested party. Mr Walsh submits that that is an absurd position. He may well be right, but that is the effect of Parliament's definition of "interested party" in section 13(3).
20. The question is not whether the claimant's business activities would be impacted upon in some way by the proposal; it is not whether they are in general terms an interested party; it is whether they are a business "in the vicinity" of the application site. The first defendant's conclusion that they are not is one which was readily open to it upon the evidence.
21. For these reasons this application must be refused.

MR WILLIAMS: My Lord, costs. My learned friends should both have a copy of the first defendant's costs schedule. If not, I could provide a second copy to them.

MR JUSTICE SULLIVAN: I do not know that I do. I have a copy of the claimant's costs, not the first defendant's costs, no.

MR WILLIAMS: I will hand a copy to your Lordship.

MR JUSTICE SULLIVAN: Yes.

MR WILLIAMS: My Lord, I would respectfully submit that that is a reasonable figure to put on the costs for defending this application and I would ask the court to exercise its discretion and award that in full, subject to anything my learned friend Mr Walsh says.

MR MARTIN WALSH: I certainly cannot resist the first defendant's claim for costs.

MR JUSTICE SULLIVAN: No. Neither in principle, nor in amount?

MR MARTIN WALSH: Not in principle, my Lord, no. I have not seen any costs schedule in respect of the second defendant.

MR JUSTICE SULLIVAN: I think Mr Stephen Walsh would have to persuade me that it was an exceptional case so that I should grant costs. Normally we do not grant two lots of costs in a judicial review, particularly if one party is really saying, "Here, here" to the other party. The second defendant is saying, "Here, here" to the first defendant.

MR STEPHEN WALSH: Well, my Lord, we would apply for costs. Could I deal with the principle, first of all?

MR JUSTICE SULLIVAN: Of course.

MR STEPHEN WALSH: In this particular set of circumstances, first of all the issue as to vicinity was raised by those who instruct me in the course of the proceedings in the first place.

MR JUSTICE SULLIVAN: Yes.

MR STEPHEN WALSH: The decision of course went the way in which it did and the second defendants were served with the judicial review proceedings. Now, as a second defendant in these circumstances, and particularly bearing in mind that it was the second defendant's submission before the first defendant's which gave rise to the decision, obviously it is essential for the second defendant, following service, to serve its detailed grounds and to serve its skeleton argument in accordance with the standard directions. Now, I have to say that in this particular case both the acknowledgement of service and the detailed grounds were prepared and served without sight of the first defendant's position. It may be that the second defendant served the detailed grounds, for example, well in advance. Now, there are often circumstances in cases such as these, particularly when dealing with the new licensing regime where it is essential, upon a hearing of this kind, for the parties which are directly affected to be represented. The effect upon the second defendant is that the development of their site, which was already licensed under a former regime, has been substantially delayed by very, very many, many months. They could not continue work because the certainly of the licence was not there. So the second defendants have certainly been prejudiced in terms of the development of the site. If they are to be deprived of their costs in terms of appearing and defending these proceedings, it would, in my respectful submission, be a circumstance in which, for example, if the second defendant had chosen to allow the council to plough its furrows and to represent the interests of the second defendant, the second defendant would not be in a position to raise arguments which your Lordship has in the skeleton argument in relation, for example, to cumulative impact. I know that it was not necessary to go into a vast amount of detail at the end of the day, but can I ask you to look at the second defendant's skeleton argument?

MR JUSTICE SULLIVAN: Yes.

MR STEPHEN WALSH: First, we have adopted a slightly different approach, but certainly it was part -- and a significant part -- of Mr Walsh's approach today, you will see in paragraphs 1 and 2 our position that the second defendant suggests that the claimant's approach in essentially conflating the approach to be adopted on a cumulative impact basis and the section 13 definition of "vicinity" was erroneous. That was primarily, it is fair to say, the second defendant's position. I was certainly in a position to argue and to develop the skeleton argument, lest it were necessary to argue the detail and the extent to which the cumulative impact policy, whether amended or otherwise, should affect the way in which or to what extent a licensing authority was to look at the question of "vicinity". So it was essential that the second defendants were in a position to argue their case so far as that was concerned. I need not go through the skeleton argument in detail, but your Lordship will see that each and every element of the approach which is adopted by the claimant is dealt with and a different approach is adopted -- a slightly different approach -- to the Council.

MR JUSTICE SULLIVAN: Yes.

MR STEPHEN WALSH: Now, here the complainant in this case is a commercial entity which brought this judicial review in the knowledge that, whatever the result, there would be a very substantial delay to the opening of what would be a competitive night club.

MR JUSTICE SULLIVAN: Well, I suppose you could have proceeded and simply told them, "Either you get interim relief and stop us proceeding, and give us a proper cross-undertaking in damages, otherwise we are just going ahead". That is what you would do if you got planning permission -- sometimes.

MR STEPHEN WALSH: Sometimes, but not always.

MR JUSTICE SULLIVAN: No, not always.

MR STEPHEN WALSH: That is very risky. Certainly if an operator such as Brook Leisure or indeed the claimant were to ask advice from their lawyers: "Should we build the thing for possibly £3 million or shall we wait and see?", it would be very robust advice that said: "Get on and spend your £3 million because it will be all right in the end" -- particularly on an issue such as this.

MR JUSTICE SULLIVAN: I suppose the adviser might say, "Write to the other side saying, 'One week from now we are going to start on site. If you want to take injunctive relief, tell us now, otherwise we will take delay against you'". I am not criticising any advice that was given to anyone, but if you want to stop someone in their tracks, then you might have to pay the penalty by a cross-undertaking in damages.

MR STEPHEN WALSH: Of course, my Lord that is a possibility, but I think your Lordship will understand the way in which I put it.

MR JUSTICE SULLIVAN: Of course.

MR STEPHEN WALSH: There is prejudice to the second defendant, whatever the benefit in this case to the claimant, and because these are two commercial entities, one who made the original application and the claimant at the end of the day objected to it, it would seem -- and I put it as high as this -- it would seem unjust to a second defendant who is forced into a position of coming to this court in order properly to defend its position, not to have any of its costs reimbursed, even though the arguments which it developed and advanced in these proceedings were successful. So, in my submission, it is not a case in which it would be right for the second defendant to leave it to the council and say, "Well, you do what you will do and do your best". It is a case in which the second defendant had to appear, had to acknowledge service, and, having acknowledged service, has had to comply with the standard directions in the ordinary way.

MR JUSTICE SULLIVAN: Yes. Yes, thank you. Mr Walsh, I am not persuaded that there was a sufficiently separate and distinct interest. I appreciate there is a commercial interest which is different from the council's, but this is not a case where the council was being pusillanimous about any aspect of the case. It was firing at you with all guns and there was no reason to suppose it would not fire all those guns when we got here. So I do not think there was a separate legal point really that the second defendant raised. But, on the other hand, it could be said that until they knew what the council's position was, it was perfectly reasonable for them -- and indeed essential under the rules in case they wanted to participate -- to put in an acknowledgement of service and summary grounds. Then, having seen that the council was effectively rowing along in the same way, then would be the time to choose not to appear at the hearing. What do you say about their costs of the acknowledgement of service, and, I suppose, detailed grounds once permission was granted? Is that right?

MR STEPHEN WALSH: Yes, indeed, detailed grounds. But we also served a skeleton argument. There is one difficulty. There were discussions between the parties last week, and, as I understand it, discussions between the counsel and the claimant, and the result of that was that one did not know whether it was necessary to put in a skeleton at all and finally last Friday it was confirmed that the matter was to proceed. So I had to put in a skeleton as well without having any sight of the other side's skeleton argument.

MR MARTIN WALSH: My Lord, the question of delay and prejudice to the second defendant is a tad mischievous because until very, very recently they did not even have planning consent to proceed.

MR JUSTICE SULLIVAN: I do not think that, I am afraid, is in any event a good ground. I appreciate it is very important --

MR MARTIN WALSH: This was simply a challenge against the decision of the local authority, to which the local authority immediately responded once we initiated these judicial review proceedings and a review of the skeleton argument, and indeed the responses of both the first defendant and the second defendant were realised upon consideration once one realised that the issues raised were absolutely identical. So this was a simple challenge against the decision of the first defendant, which the first defendant resisted, and I cannot resist their costs. But I do resist the costs of the second defendant. They are identical issues.

MR JUSTICE SULLIVAN: I just simply want to understand the timing of the thing. The detailed grounds for contesting the claim are put in at 293. I just want to understand the dates.

MR WILLIAMS: My Lord, if it assists, that is the chronology I did not seek to rely on. There are the detailed first defendant's submissions. It is on page 2, supplying the detailed grounds. But the difficulty I had in preparing that is that the second defendant's detailed grounds and indeed skeleton argument did not come with a date on them and so I was not able to include them in the chronology.

MR JUSTICE SULLIVAN: Yes, I see. Mr Stephen Walsh (to identify which Mr Walsh), we have got detailed grounds of resistance from the first defendant, 20 July 2007. We have got the acknowledge of service and grounds by March. So we knew in March 2007 what the first defendant was going to say. What date is your acknowledgement of service and detailed grounds -- or summary grounds?

MR STEPHEN WALSH: I am just turning to them. It would be at a similar point in time. It is behind divider 17. It was 23 July.

MR JUSTICE SULLIVAN: 23 July was what?

MR STEPHEN WALSH: The detailed grounds.

MR JUSTICE SULLIVAN: And your acknowledgement of service?

MR STEPHEN WALSH: The acknowledgement of service ....

MR JUSTICE SULLIVAN: Were the summary grounds with the acknowledgment of service or what?

MR STEPHEN WALSH: No. The acknowledgement of service was a brief acknowledgement of very summary grounds. The detailed grounds were those which were served on 23 July upon the council.

MR JUSTICE SULLIVAN: I understand. Thank you very much. I am not persuaded that there is any reason for departing from the normal order in this case. I appreciate that the second defendant feels somewhat aggrieved. It may or may not have been delayed, but the normal course is that there is one lot of costs unless there is some very distinct legal issue and it seems to me that, certainly as from March, the council' position was perfectly clear. It was firing on all cylinders. Essentially they were the same cylinders as those on which the second defendant would have wanted to fire and, whilst it was very nice to see Mr Stephen Walsh here, I am not persuaded that two lots of costs is appropriate.

So application refused and the claimant is to pay the first defendant's costs, those costs to be summarily assessed in the sum of £7,845.

Anything else? Good. Thank you very much.