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Cite as: [2004] LLR 171, [2004] ScotCS 24
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Calderwood v. Renfrewshire Council [2004] ScotCS 24 (03 February 2004)
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EXTRA DIVISION, INNER HOUSE, COURT OF SESSION |
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Lord MacLean Lord Osborne Lady Cosgrove
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OPINION OF THE COURT delivered by LORD OSBORNE in Appeal for Defenders under Summary Application under Paragraph 18, Schedule 1 of the Civic Government (Scotland) Act 1982 from the Sheriffdom of North Strathclyde at Paisley in the action at the instance of MRS CAROL CALDERWOOD Pursuer and Respondent; against RENFREWSHIRE COUNCIL Defenders and Appellants;
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Act: Brown, Advocate; Lindsays, W.S.
Alt: Sir Crispin Agnew of Lochnaw, Q.C., Simpson & Marwick, W.S.
3 February 2004
THE BACKGROUND TO THE APPEAL
[1] For a considerable number of years, the respondent in this appeal has held a street trader's licence in terms of which she has operated a flower stall in the vicinity of Paisley Cross, namely in High Street, adjacent to Moss Street, Paisley. By application, dated 12 November 2001, the respondent sought renewal of her street trader's licence. The application for this licence came before the Regulatory Functions Board of the appellants, hereinafter referred to as "the Board" on 31 July 2002, when it was refused, this decision being intimated to the respondent by a letter dated 31 July 2002. Subsequently, by letter dated 2 August 2002, the respondent requested a Statement of Reasons relative to the Board's decision to refuse her application. Such a Statement of Reasons, dated 16 August 2002, was furnished to the respondent. That Statement of Reasons is to be found reproduced in full at page 3 of the Appendix in this appeal. For present purposes, it is sufficient for us to quote certain passages from that Statement of Reasons and to summarise other parts of it. At the outset of the Statement of Reasons, it is stated by the author, the assistant managing solicitor of the appellants' Department of Corporate Services, as follows:"I confirm that at the meeting of the Regulatory Functions Board (hereinafter referred to as 'the Board') held on 31 July 2002 Mrs Calderwood's application for the above licence was refused and this decision was intimated to Mrs Calderwood by the Licensing Authority by letter dated 31 July 2002. In reaching this decision the Board had regard to:
(a) the terms of the application for renewal of a street trader's licence made by Mrs Calderwood which inter alia detailed a trading location on the High Street adjacent to Moss Street, Paisley.
(b) The terms of the Licensing Authority's existing policy on Paisley Town Centre Regeneration: Managing the Public Realm which states inter alia that '..... there shall be no street trading within the High Street area from the Cenotaph to New Street....'. A copy of said policy is annexed hereto and is referred for its terms brevitatis causa.
(c) A representation from the Council's Head of Roads, details of which are narrated in full in a citation letter to Mrs Calderwood dated 5 July 2002 and a copy of which said letter is annexed and referred to herein for its terms.
(d) A copy map detailing the exact location of the applicant's stall in relation to the exclusion zone referred to in the said policy intimated to the applicant by letter dated 16 July 2002 and a copy of said letter and map are annexed and referred to herein for their terms.
(e) The submissions made on behalf of Mrs Calderwood by her agent, Mr Banks, at the meeting of the Board on 31 July 2002."
"There being no further questions, Councillor Burns moved refusal of the application on the grounds that the applicant had not justified a reason why the Board should not apply the policy. Councillor McGerty seconded the motion and indicated he wished to speak in seconding the motion. He indicated that the policy represented a new chapter for Paisley Town Centre with the area at Gilmour Street being identified and becoming an actual market area. He stated the applicant had made a very good case but the Board was dealing with a policy and he therefore seconded the motion.
Councillor Martin indicated that he would suggest the policy did leave itself open to interpretation. The flower stall was part of the history of Paisley. The stall had done nothing to decry Paisley whilst functioning. Any application had to be treated individually and not in a blanket fashion and he would move the Board to accept the applications. There was no seconder for Councillor Martin's motion and Councillor Burns' motion was accordingly carried."
Thereafter the Board's Statement of Reasons concludes as follows:
"I therefore confirm that your client's application for renewal was refused in terms of Schedule 1 of paragraph 5(d) of the Civic Government (Scotland) Act 1982 in that there was other good reason for refusing the application as narrated above. The collective decision of the Licensing Authority, having had regard to existing policy and the submissions made on behalf of your client was that there had been no special case made out as to why the existing policy should not apply to your client's application and, accordingly, the application was refused."
"(a) That the defenders have erred in law because their decision is inadequate, because they have applied an onus on the appellant which does not exist in law and because they have rigidly applied a policy;
(b) That the defenders have exercised their discretion unreasonably; and
(c) That the defenders have not acted contrary to natural justice."
So far as relevant to the present appeal, the sheriff's decision was in the following terms:
"1. Error in Law
(a) Adequacy of the Decision
I consider that the submissions of counsel for the appellant (Mr Brown) are well-founded. The reasons letter of 16 August 2002 contains a narrative of the proceedings running to six pages. Mr Brown pointed to various comments made by individual councillors in the course of the proceedings as narrated in the letter. Mr O'Brien maintained that any comments by councillors in the narrative of events at the hearing as set out in the letter were not to be taken as the collective will of the Board, that is the reasoning of the Board for the purposes of the Statute. If that is accepted; and I am inclined to accept that the bulk of the letter contains a narrative of proceedings; then the reasons for the refusal are difficult to find. The letter states on page 1 that the Board had regard to the terms of the application, the terms of the policy, a representation of the Roads Department, the map and the submissions. Since these were the factors applicable to the application, it is not surprising that the Board had regard to them. They do not explain why the Board came to the decision it did. At the end to (sic) the narrative of the appellant's submissions there is a narrative of what the Board then did. The last paragraph then narrates: 'I therefore confirm that your client's application for a renewal was refused for the reasons narrated above, in that the collective decision of the Licensing Authority, having regard to the existing policy and the submissions made on behalf of your client, was, that there had been no case made out as to why the existing policy should not apply to your client's application and accordingly the application was refused.' I scrutinised the text above the paragraph, as directed to find, 'the reasons narrated above'. I looked in vain. I then considered the rest of the paragraph. If 'the reasons' were 'above' then I wondered whether the import of the words following were further reasons, whether they were the same reasons, whether they were a summary of the reasons 'above' or whether they were something else entirely? Mr O'Brien sought to maintain that the fact that the disclosure of the items to which the Board had had regard gave sufficient reason and explanation. He later modified the position to maintain that what was written was all that was needed as reasons for the decision in the circumstances. There was a policy and the appellant's circumstances were not sufficient for the policy not to apply to her. On that basis the reasons are contained in the last sentence of the letter. Lest there be any doubt I wish to make it clear that the narrative of the items to which the Board had regard without a further explanation of the decision is a formulaic approach which is wholly inadequate. It seems to me that there is a requirement on the Board to provide reasons. Each case will turn on its own facts. This is not a case where a blanket statement is enough. In this case the applicant was the existing holder of a licence. The Council had recently formulated a policy as they were entitled to do. That was a change in the circumstances affecting the licence holder. She had put in issue through the submissions by her solicitor a number of matters which she maintained were factors relevant to her application. None of these factors were stated to be irrelevant. As many of the cases show, the test is that the appellant is entitled to know why her application had been refused. In my view she required to be given an explanation greater than the formulaic narrative produced by the defenders as reasons. It was accepted by Mr O'Brien that the Board required to consider the various factors relevant to the application namely the factors presented by the appellant on the one hand and the elements of policy on the other. Mr O'Brien maintained that the Board were not bound to specify the individual factors and the weight attached to each. He quoted cases to this effect. As I have said each case turns on its own facts and I am clear that on any view the reasons letter gives no adequate reasons for the decision. The only explanation given was that the application had been refused because no case had been made out for departing from the application of the policy. If the application of the policy without elaboration was the reason then the next issue raised has to be considered. As a consequence of what I say above and below I consider that the defender's reasons are wholly inadequate in the circumstances of the application and the defenders have erred in law in that connection.
(b) Rigid Application of Policy
It is difficult not to conclude, in the absence of any reasons other than policy, that the Board applied a rigid application of the policy. I so hold.
(c) Inversion of Onus
It seems to me that Mr Brown is also correct in his submissions in this aspect also. The obligation on the Board was to consider each application on its own merits. That meant in effect that the policy was to be a guideline. There is no doubt that the policy is a factor, and a factor to which the Board was entitled to attach weight. The submissions for the appellant were also a factor which the Board had to take account of. They had to carry out a balancing exercise. But the factors required to be considered on their individual merits. I agree with Mr Brown that the fact that there was a policy did not shift any onus onto the appellant. The Statute directs the Board to grant the application unless there is some other good reason for refusing the application. If the policy was a factor and the appellant's circumstances were another factor, then there could be no onus on the appellant. Accordingly, to apply an onus was to require the appellant to prove a case she was under no obligation to prove. If on the other hand the Board ascribed to the policy a status greater than that of factor or guideline then they appear to have applied a rigid application of a policy. The wording of the last paragraph of the reasons letter is indicative of both an inversion of the onus and of a rigid application of the policy. Either way, the Board misdirected themselves in law; their reasoning was flawed and the appeal must succeed. I hold that there has been an inversion of onus and that the defenders have erred in law in that respect also. In summary therefore I uphold the submissions of Mr Brown that the defenders have erred in law by having inadequate reasons for their decision, by applying an onus on the appellant that does not exist in law and by rigidly applying the policy of the defenders.
2. Unreasonable Exercise of Discretion
There appear to be two approaches to this aspect of the appeal. The first is that where, as here, the Board have failed to give reasons for their decision it is difficult to form a view as to whether there was an exercise of their discretion and whether it was reasonable or unreasonable. The second is that of the reasons proffered do not disclose any exercise of discretion at all, it must follow that it has not been shown that there has been a reasonable exercise of discretion, therefore any exercise must have been unreasonable. It is, of course, in the remit of the Board to exercise its discretion. In normal circumstances it would be more appropriate therefore to proceed on the basis of error of law than of unreasonable exercise. However, where as here there has apparently been the rigid application of a policy it would be open for the court to hold also that there has been an unreasonable exercise of discretion. Where, as here, the Board have erred in law, I consider that it also follows that in so far as they exercised their discretion, such exercise was unreasonable."
After reaching the foregoing decision, the sheriff remitted the respondent's application to the Board for reconsideration of their decision.
THE SUBMISSIONS
[5] Senior counsel for the appellants began his submissions by outlining the statutory provisions which applied to the respondent's application to the Board and her appeal to the sheriff. In particular, he drew attention to the provisions of paragraph 5 of Schedule 1 to the 1982 Act. Sub-paragraph 5(3) provided that:"A licensing authority shall refuse an application to grant or renew a licence if, in their opinion .... (d) there is other good reason for refusing the application; and otherwise shall grant the application."
It was upon that basis of "other good reason" that the Board had refused the respondent's application here. He also drew attention in detail to paragraph 18 of Schedule 1 to the 1982 Act, which had dealt with the grounds of appeal available to a disappointed applicant to the sheriff and with the availability of an appeal on a point of law from a sheriff's decision to this court.
[6] Turning to the particular circumstances of this case, senior counsel for the appellants submitted that the important issue before the sheriff had been that of policy and the proper approach to it. The appellants' contention was that the sheriff had erred in that regard. The error was apparent from that part of his decision where he dealt with what he called the inversion of onus. The sheriff had misapprehended the law both in regard to the proper approach to policy and also in regard to onus. It would be the appellants' contention that, on a proper view of the law, there had been an onus on the respondent to show that her application should be treated as an exception to the applicable policy. [7] Dealing in greater detail with the matter of policy, senior counsel for the appellants advanced three propositions: (1) a licensing board was entitled to have a policy; (2) a licensing board could not apply its policy by simply refusing to hear an applicant, whose application appeared to be in conflict with it, but was obliged to give the applicant an opportunity to say why their case should be treated as an exception; (3) a licensing board was entitled to reach a decision upon the basis of its policy, unless there was something exceptional in the applicant's case. In support of these propositions reliance was placed on a number of authorities. The first of these was In re Findlay [1985] 1 A.C. 318. The speech of Lord Scarman at p. 335H to 336F was of importance. Examination of the sheriff's approach, against the background of the observations mentioned, made it clear that he had erred in relation to the significance of policy. Reliance was also placed upon Elder v Ross & Cromarty District Licensing Board 1990 S.L.T. 307 at p. 311J to 312A. That case indicated that, if a policy were to be relied upon, it had to based on grounds which related to and were not inconsistent with or destructive of the purposes of the statutory provisions under which the discretion was operated. Senior counsel for the appellants stated that, in the present case, no challenge had been mounted to the policy relied upon by the Board. In Bass Inns & Taverns Limited v Glasgow District Licensing Board 1995 S.C. 226 the observations of Lord Weir in Elder v Ross & Cromarty Licensing Board had been approved, particularly between p. 228B and 230E. Furthermore, in Ahmed v North Lanarkshire Council 1999 S.L.T. 1064, cogent observations had been made concerning the proper approach towards policy. It was made clear at page 1067 that, even if some course of conduct inconsistent with a policy could be regarded as consistent with, or likely to achieve, the general aims of the policy, a council was nevertheless entitled to require conformity with the policy itself, in the absence of any positive or specific justification for departure from it. That was relevant to the circumstances of this case, where much emphasis had been placed on behalf of the respondent upon the positive contribution to the amenity of the area in which it was situated made by the respondent's flower stall in the past. [8] Turning to the matter of onus, senior counsel for the appellants, in submitting that the sheriff had erred in this regard also, relied upon McAllister v East Dunbartonshire Licensing Board 1998 S.L.T. 713. At p. 719 to 720, the matter of onus was discussed. It was recognised that, while there was no onus upon an applicant in relation to an aspect of the application which had not been put in controversy, where some feature of the application had been put in controversy, there was a practical onus upon the applicant to respond adequately in an appropriate way. That principle had also been recognised in Chief Constable of Strathclyde Police v North Lanarkshire Licensing Board 2003 S.L.T. 1268 at p. 1274K to 1275A.. Thus, applying this principle to the circumstances of the present case, the matter of the Board's policy having been raised in relation to the respondent's application, there was an onus upon the applicant to demonstrate why her application should be treated as an exception to the policy. Senior counsel for the appellants then proceeded to examine in detail the statement of reasons for their decision issued by the Board. At page 7 of the Appendix there was a narrative of an argument advanced on behalf of the respondent before the Board, which was similar to the argument rejected by the Court in Ahmed v North Lanarkshire Council. The essentials of the Board's decision were to be found at page 8 of the Appendix. It was submitted that that was a perfectly proper decision. It was clear from what was said in it that the Board had indeed listened to the submissions made on behalf of the respondent and had not simply made a decision in accordance with their policy without listening. It was evident from the terms of the respondent's application for renewal of her licence, appearing at pages 9 to 12 of the Appendix, that that application amounted to a direct challenge to the policy of the appellants. It was plain from the letter dated 11 June 2002 from the appellants to the respondent, which appeared at pages 15 to 17 of the Appendix, that the appellants had been at pains to explain the policy background of the respondent's application to her. In this connection reference was also made to the letter dated 5 July 2002 from the appellants to the respondent, reproduced between pages 20 and 22 of the Appendix, and to the letter dated 16 July 2002, together with a map of the area protected by the policy, from the appellants to the respondent, which appeared between pages 23 and 24 of the Appendix. [9] It was unfortunate that, for some reason, in his decision of 14 March 2003, the sheriff had proceeded upon the basis that the appellants' Statement of Reasons for their decision was in the terms set forth in the document reproduced at pages 28 to 33 of the Appendix. That document was in fact a "file copy" of a Statement of Reasons, which was in materially different terms from the Statement of Reasons actually sent to the respondent, which appeared between pages 3 and 8 of the Appendix. It was evident from his decision that the sheriff had focused upon the terms of the last paragraph of that file copy Statement of Reasons. In the Statement of Reasons actually sent to the respondent, that paragraph had been in different terms from those which had been considered by the sheriff. Accordingly his reasoning in relation to that paragraph was without any foundation. [10] It was submitted on behalf of the appellants that they had acted reasonably throughout in relation to this matter. There had been extensive public consultation between them and interested parties prior to the making of the decision on the respondent's application. That was evident from a minute of meeting, dated 10 April 2002, between representatives of the appellants and street traders. The minute was reproduced between pages 34 and 37 of the Appendix. While there was not before the Court any statement regarding the considerations which led to the adoption of the policy by the appellants, there had been no attack upon that policy. It was not said that it was based on irrelevant or inappropriate considerations. [11] Senior counsel for the appellants then proceeded to examine the sheriff's decision. He had made three findings in fact and in law. Finding (c) was not in issue. As regards findings (a) and (b), both of those findings involved errors of law on the part of the sheriff. As regards the three separate matters referred to in finding (a), that of onus and the application of a policy had already been dealt with. The remaining matter dealt with in that finding was the adequacy of the Board's decision. The sheriff had erred in relation to that also. As already mentioned, he had considered this issue under reference to the terms of a Statement of Reasons which had not been sent to the respondent. The Statement of Reasons which had been sent to her was a proper one. In that connection reference was made to Wordie Property Company Limited v The Secretary of State for Scotland 1984 S.L.T. 345, in which Lord President Emslie described at page 348 what was necessary by way of reasons for the making of a proper decision under a statutory discretion. The test which he set forth there had been recognised as applying to licensing decisions in Mirza v City of Glasgow Licensing Board 1996 S.L.T. 1029, at p. 1034. The reasons given by the Board to the respondent satisfied the requirement for adequate reasons. The sheriff's decision in relation to this matter was based upon a misapprehension as to what reasons had been stated to the respondent. As regards the matter of the sheriff's finding in fact and in law (b), it was plain that his reasoning was based upon an error of law in relation to the significance of policy. In all of these circumstances the sheriff's decision could not stand. His interlocutor should be recalled, which would have the effect of reinstating the decision of the Board. [12] Counsel for the respondent moved the Court to refuse the appeal and affirm the decision of the sheriff. The sheriff had reached a correct decision for substantially the right reasons. However, it was accepted that he had gone too far in equating a policy with a guideline. Furthermore, it was accepted that the sheriff had proceeded upon the basis of the wrong Statement of Reasons in assessing the adequacy of the reasons given by the Board. This Court required to proceed upon the basis of the statement of reasons which had actually been issued to the respondent. The principal submission on behalf of the respondent was that, regardless of the merits of the matter, the reasons given by the Board for their decision were so inadequate as to require that the case should be remitted to the Board for reconsideration. It was also submitted that the statement of reasons issued by the Board showed only that their policy was rigidly applied. That approach was open to criticism. As regards the reasons given by the Board, they had ignored three important factors in their formulation. First, the respondent and her mother had been trading for a period of 20 years. Secondly, it was widely accepted that the respondent's flower stall had been a visual asset in the location occupied by it; it had been an attractive stall, which had featured in numerous promotional brochures. Thirdly, there had been widespread public concern at the possible loss in the location in question of the respondent's stall. None of these matters had been referred to in the Board's statement of reasons. [13] There had been before the Board a properly argued and presented case for the making of an exception to the Board's policy in the case of the respondent. In that situation, it was contended that the Board had been under and obligation to set out in greater detail than they had done why they had felt unable to depart from their policy in this case. [14] Counsel for the respondent accepted that the Board's policy had been raised as a factor. It was now accepted that that meant that there had been a practical onus upon the respondent to deal adequately with the matter of the application of the policy. She had in fact done that. A persuasive case had been advanced on her behalf before the Board. It ought to have given reasons dealing with the points advanced. She had discharged the practical onus upon her. In all the circumstances the decision of the sheriff should be upheld.DECISION
[15] We shall deal with the issues which have arisen in this appeal in the order in which they are dealt with in the sheriff's findings in fact and in law. Coming therefore, first of all, to the issue of the adequacy of the reasons given by the Board for their decision, it is a matter of agreement that, in that part of his decision dealing with this matter between pages 32 and 35 of the Record in the appeal, the sheriff's observations have been directed towards what he conceived to be the reasons given by the Board for their decision. Unfortunately, for whatever reason, the sheriff misdirected himself in fact in relation to that matter. His consideration was focused upon the document which appears between pages 28 and 33 of the Appendix, which, it was agreed, was merely a file copy of certain reasons. It was accepted that no document in those terms had been sent to the respondent. What had in fact been sent to her as the Statement of Reasons of the Board was a document, the terms of which are set forth between pages 3 and 8 of the Appendix. It follows from the acceptance of that state of affairs that, in relation to this aspect of the case it is necessary for the sheriff's reasoning to be discarded. This Court must consider for itself the reasons which were in fact issued to the respondent, with a view to reaching a decision upon their adequacy or otherwise. [16] It was a matter of agreement in the discussion before us that the test of the adequacy of reasons given by a body exercising a statutory discretion was set forth in Wordie Property Company Limited v The Secretary of State for Scotland. Although the statutory context of that case was different from that of this appeal, what was said there by Lord President Emslie has been accepted as applicable in a licensing context, as appears from Mirza v City of Glasgow Licensing Board. At p.348 Lord President Emslie said this:"..... All that requires to be said is that in order to comply with the statutory duty imposed upon him the Secretary of State must give proper and adequate reasons for his decision which deal with the substantial questions in issue in an intelligible way. The decision must, in short, leave the informed reader and the court in no real and substantial doubt as to what the reasons for it were and what were the material considerations which were taken into account in reaching it."
"The collective decision of the Licensing Authority, having had regard to existing policy and the submissions made on behalf of your client was that there had been no special case made out as to why the existing policy should not apply to your client's application and, accordingly, the application was refused."
In our opinion, the Statement of Reasons given by the Board does meet the test set forth in Wordie Property Company Limited v The Secretary of State for Scotland, having regard to the fact that, in their concluding paragraph, the Board make reference to the submissions made on behalf of the respondent. What the Board appears to us to have said was that, even in the light of all of those detailed submissions, they had not been persuaded that an exception should be made to the existing policy in favour of the respondent. It is true that, in the concluding paragraph the Board do not expressly mention again what the submissions made on the respondent's behalf were. However, we consider that to have done so would have been unnecessary repetition. What is quite clear that is that they had taken those submissions into account. In these circumstances, in our view, the criticisms directed against the adequacy of the Board's reasons fail.
[18] Turning now to the second element in the sheriff's first finding in fact and in law, namely that of onus, it was accepted by counsel for the respondent that there had indeed been a practical onus upon her to discharge, since it was accepted that the Board's policy had been raised as an issue in the application. In our view, that was a correct concession. The position of a licensing authority under the 1982 Act is, of course, regulated by paragraph 5 of Schedule 1 to the Act. Paragraph 5(3) provides that:"a licensing authority shall refuse an application to grant or renew a licence if, in their opinion" a number of a particular circumstances exist. One of these is that "(d) there is other good reason for refusing the application; and otherwise shall grant the application." Thus the matter of onus is not the subject of any statutory provision. However, in McAllister v East Dunbartonshire Licensing Board, Lord McCluskey, delivering the Opinion of the Court, made certain observations on the topic. He said:"Accepting that there is no onus upon an applicant to take positive steps to establish demand, we are nonetheless of the view that where, as here, a specific objection has been taken on the ground of absence of demand for the creation of further betting office facilities and it has been placed before the licensing board by objectors who have put in written objections in terms of paragraph 11 of Schedule 1 to the 1963 Act, it is appropriate for the licensing board to approach the matter on the basis that the applicant has to respond adequately to the submission, supported by appropriate material, that the grant of a further licence would be inexpedient having regard to the demand for the time being in the locality for such facilities."
That approach was affirmed in the Opinion of the Court in Chief Constable of Strathclyde Police v North Lanarkshire Licensing Board where it was said in relation to the passage just quoted:
"We take it from this passage that, in a context in which objections to an application have been lodged by a person such as a chief constable, supported by prima facie significant material, the licensing board should approach the matter of the application upon the basis that the applicant has to respond adequately to the matter raised in the objections. Putting the matter in another way, while there may be no legal onus upon an applicant in a particular context, where issues of relevance and significance have been raised in objections, there comes into being a practical need for the applicant to deal with those matters by an adequate response."
"The legitimacy of adopting a policy in the exercise of an administrative discretion has been recognised by the court. In a tribunal case Banks L.J. had this to say, Rex v Port of London Authority, ex parte Kynoch Limited [1919] 1 K.B. 176, 184: 'In the present case there is another matter to be borne in mind. There are on the one hand cases where a tribunal in the honest exercise of its discretion has adopted a policy, and, without refusing to hear an applicant, intimates to him what its policy is, and that after hearing him it will in accordance with its policy decide against him, unless there is something exceptional in his case. I think counsel for the applicants would admit that, if the policy has been adopted for reasons which the tribunal may legitimately entertain, no objection could be taken to such a course. On the other hand, there are cases where a tribunal has passed a rule, or come to a determination, not to hear any application of a particular character by whomsoever made. There is a wide distinction to be drawn between these two classes.' In British Oxygen Company Limited v Board of Trade [1971] AC 610, Lord Reid saw 'nothing wrong with that' and added, at p.625: 'What the authority must not do is to refuse to listen at all, but a ministry or large authority may have had to deal already with a multitude of similar applications and then they will almost certainly have evolved a policy so precise that it could well be called a rule. There can be no objection to that, provided the authority is always willing to listen to anyone with something new to say - of course I do not mean to say that there need be an oral hearing.'"
The approach elucidated by Lord Scarman is one which has been reflected in Scottish authorities. In Elder v Ross & Cromarty District Licensing Board, Lord Weir observed in relation to the significance of policy:
"The law on this question has been developed in a number of English cases and I am satisfied from a study of references in several cases decided in our court that the law of Scotland is no different. The principles which are established, in my opinion, may be summarised in this way. Where a statutory body having discretionary powers required to consider numerous applications there is no objection to it announcing that it proposes to follow a certain general policy in examining such applications. Indeed, in certain circumstances it may be desirable to achieve a degree of consistency in dealing with applications of similar character. Moreover, there is nothing wrong with policies being made public so that applicants may know what to expect. However, such a declared policy may be objectionable if certain conditions are not fulfilled. A policy must be based on grounds which relate to and are not inconsistent with or destructive of the purposes of the statutory provisions under which the discretion is operated. Moreover, the policy must not be so rigidly formulated so that, if applied, the statutory body is thereby disabled from exercising the discretion entrusted to it. Finally, the individual circumstances of each application must be considered in each case whatever the policy may be. It is not permissible for a body exercising a statutory discretion to refuse to apply its mind to that application on account of an apparent conflict with policy."
The approach described by Lord Weir was accepted as appropriate in Bass Inns & Taverns Limited v Glasgow District Licensing Board at p. 228. In these circumstances, it is plain that the sheriff erred in law in ascribing to the policy of the Board the status of being merely a factor or guideline. It must be emphasised in connection with this part of the case that no argument was addressed to us to the effect that the policy of the Board was in itself objectionable for any reason. In particular, it was not argued that it was based on grounds which were inconsistent with or destructive of the purposes of the statutory provisions under which the discretion was operated. Furthermore, it was not said that the policy had been so rigidly formulated that, if applied, the statutory body would thereby be disabled from exercising the discretion entrusted to it. Moreover, it was not and could not have been said in this case that the Board simply did not listen to the applicant and did not consider whether her case should be regarded as an exception to the application of the policy. It is quite clear from the Board's Statement of Reasons that they did consider the individual position of the applicant, but in the end concluded that no special case had been made out as to why the existing policy should not apply to the respondent's application.
[21] Turning finally to the sheriff's finding in fact and law (b), the sheriff deals with the matter shortly in this way. At page 36 of the Record in the appeal, he states:"However, where as here there has apparently been the rigid application of a policy it would be open for the court to hold also that there has been an unreasonable exercise of discretion. Where, as here, the Board have erred in law I consider that it also follows that in so far as they exercised discretion, such exercise was unreasonable."
In our opinion, this part of the sheriff's decision cannot stand. It appears to us that it is based upon the misapprehension in law on the part of the sheriff as to the part which may legitimately be played by policy in the exercise of a statutory discretion such as was involved here, to which we have already alluded.
[22] In the whole circumstances, we have reached the conclusion that the decision of the sheriff involved the errors of law which we have described and, in any event, proceeded upon the basis of a misapprehension in fact as to the reasons given by the Board to the respondent for their decision. Accordingly, we shall allow the appeal and recall the interlocutor of the sheriff dated 14 March 2003. In view of the conclusions which we have reached regarding the adequacy of the Board's reasons, there is no justification for the case being remitted to the Board for any purpose. Thus the effect of our order will be that the original decision of the Board will be reinstated.