Scottish Sheriff Court Decisions

SHERIFFDOM OF GRAMPIAN, HIGHLAND AND ISLANDS at ABERDEEN

 

 

 

Case Ref: B835/10	JUDGMENT
	in causa
	DAVID CHRISTIE THOMSON and EILEEN DIANA ROSS MacADIE or THOMSON both residing at 32 Barclay Park, Aboyne, Aberdeenshire, AB34 5JF   PURSUERS
	against
	ABERDEEN CITY COUNCIL, a Local Authority incorporated under the Local Government etc. (Scotland) Act 1994 and having its Principal Office at The Town House, Broad Street, Aberdeen, AB10 1AQ   DEFENDERS

 

 

Act: Steele

Alt: Selby

 

ABERDEEN, 23 March 2011

 

The Sheriff, having resumed consideration of the cause, finds the following facts admitted or proved.

 

1.           The pursuers are David Christie Thomson and Eileen Diana Ross MacAdie or Thomson, both residing at 32 Barclay Park, Aboyne, Aberdeenshire, AB34 5JF. Mr Thomson is 63 years of age.

 

2.           The defenders are the local authority for the City of Aberdeen. They are incorporated under the Local Government etc. (Scotland) Act 1994 and have their principal office at The Town House, Broad Street, Aberdeen, AB10 1AQ.

 

3.           The defenders are the licensing authority for the City of Aberdeen in relation to licensing of houses in multiple occupation (HMO licence) in terms of the Civic Government (Scotland) Act 1982 and the Civic Government (Scotland) Act 1982 (Licensing of Houses in Multiple Occupation) Order 2000.

 

4.           The Sheriff Court of Grampian, Highland and Islands at Aberdeen has jurisdiction in this appeal.

 

5.           The pursuers are the joint heritable proprietors of the heritable subjects known as 71 Craigievar Crescent, Aberdeen.

 

6.           The pursuers purchased the property in May 2007 as a three bedroomed flat and proceeded to convert the same to a six bedroomed flat. The pursuers' intention was to lease the property.

 

7.           At that time, Mr Thomson was fully aware of the requirement for a licence in respect of properties occupied by multiple occupants. He held, and continues to hold an HMO licence from Glasgow City Council in respect of a property within their jurisdiction.

 

8.           Mr Thomson took steps to progress his project contacting the defenders in respect of obtaining planning permission for the alterations to the property and a licence in respect of the Multiple Occupancy Regulations.

 

9.           Mr Thomson instructed architectural technicians, Raymond Simpson Associates Limited, to assist him with his project.

 

10.       On 2 December 2008 Mr Thomson received a response from the defenders' employee, Ally Thain, wherein it was confirmed the planning permission and HMO licence were two separate permissions. It was indicated that planning permission was required in respect of the change of use aspect which should be pursued with the defenders' planning department. He was further advised on the requirements for an application for an HMO licence.

 

11.       Mr Thomson became concerned with what he considered to be unreasonable delay in his obtaining the necessary permissions. The lack of income from the property caused him cash flow difficulties.

 

12.       Mr Thomson decided to proceed to lease the property without an HMO licence. He did this on the basis that he considered that he could apply an exemption in the legislation whereby such licence was not required in respect of a property occupied by a religious community or family.

 

13.       During 2009 the pursuers leased the property to a group of persons. On their outgo, they advertised the property as suitable for renting by students. They did not advertise the property as suitable for renting by a religious community or by a family.

 

14.       In May 2009 the pursuers entered into a formal lease with six persons, each of whom were students studying in Aberdeen. Said lease was for a period of one year commencing on 1 September 2009. The initial approach had come from five of these persons and a sixth was later added. Production 5/1/3 is a copy of said lease.

 

15.       The six students were not a family but were individuals whose home addresses were at various places within the United Kingdom and Ireland.

 

16.       The six students were not a religious community. Mr Thomson did not enquire of them as to their religious beliefs.

 

 

17.       Clause 8 of said lease reads, inter alia as follows:-

"The subjects are let for use as study/bedrooms for Six persons only who agree to live as one religious order/family in a way that maintains exemption from the Local Authority's "Homes of Multiple Occupancy" Regulations. (Other persons only on the express consent of the landlord being given in writing prior to the date of entry), and the Tenant is prohibited from using the subjects or permitting the same to be used, for any other purpose..."

 

18.       Mr Thomson discussed the requirement under this clause with his tenants, supplied them with a copy of the Bible and the Book of the Mormon and told them that they should consider their values daily.

 

19.       Following upon a complaint regarding noise nuisance from the occupiers of the flat below, Mr Thomson became involved in a mediation procedure which was not resolved to his satisfaction.

 

20.       By e-mail message dated 10 September 2009, Ally Thain, the defenders' Private Sector Housing Manager, advised Mr Thomson that his leasing of the premises to six students without an HMO licence was illegal. There followed further e-mail messages wherein Mr Thomson claimed exemption from the Regulations, firstly based on his tenants' maintenance of a Christian community with reference to a retreat in Utah where they could pray, study and worship, and secondly as they were an "unconventional family".

 

21.       On 9 October 2009 Mr Thain responded to Mr Thomson confirming that it was the view of the defenders that the exemptions claimed did not apply.

 

22.       On 23 April 2010 Mr Thomson, for the first time, applied for an HMO licence in respect of the premises. He applied in his sole name.

 

23.       On 2 June 2010 Mr Thomson's application was considered by the defenders' licensing committee and refused. At that meeting the committee took account of letters of objection from Mrs Hepburn and her son the occupiers of the flat below the pursuers' premises. Mrs Hepburn addressed the committee and was allowed to refer to a further document, a letter purporting to come from the pursuers' tenants, which letter was not produced, shown nor intimated to Mr Thomson.

 

24.       A subsequent appeal against that decision was, on joint motion, upheld and the application remitted back to the defenders' licensing committee. Production 5/1/1 is a copy of the Interlocutor.

 

25.       Mr Thomson's application was reconsidered by the defenders' licensing committee on 15 September 2010. In advance of the meeting committee members received a bundle of papers including, an updated memorandum from Mr Thain, dated 27 August 2010, the original memorandum from Mr Thain dated 19 May 2010 and copies of the two letters of objection. Productions 5/1/4 and 5/1/6 are copies of these documents. The annotation on production 5/1/4 was appended at or after the said meeting.

26.       It was confirmed to the defenders' licensing committee, by its officials, that the premises had, since the earlier meeting, been satisfactorily completed and certified.

 

27.       The committee were advised to consider the application de novo, which concept was familiar to the committee

 

28.       There was no objection to the application from Grampian Police nor Grampian Fire and Rescue Service.

 

29.       The memorandum dated 19 May 2010 ( Production 5/1/6) drew to the committee's attention the position regarding the objection and, in particular, that Mr Thomson was leasing the premises to more than three persons without an HMO licence and was claiming that the occupants were a religious community living together as one family.

 

30.       Mr Thomson addressed the committee basing that submission on the terms of a prepared address. Production 5/1/22.

 

31.       Productions 5/1/8 and 5/1/9 are copies of contemporaneous handwritten notes taken by the licensing officer and clerk to the committee respectively.

 

32.       In his address to the committee, Mr Thomson introduced the concept of dishonesty.

 

33.       Mr Thomson was asked and answered certain questions, including answering, in the affirmative, a question "Do you agree that you colluded with your tenants to live as a religious community to evade HMO legislation?"

 

34.       The application by Mr Thomson was refused by the defenders' licensing committee as, in their opinion, Mr Thomson was not a fit and proper person to hold such a licence.

 

35.       Production 6/2/3 is a copy of a Statement of Reasons issued by the defenders in respect of that refusal. Said document incorrectly identifies the licence applicants as the pursuers, whereas the application was made in the sole name of Mr Thomson.

 

Finds in fact and in law:-

 

1.           Mr Thomson sought to evade the requirements of the Civic Government (Scotland) Act 1982 (Licensing of Houses in Multiple Occupation) Order 2000 by requiring tenants to purport to live as a religious order and family when he knew that they fulfilled neither of these criteria.

2.           Mr Thomson's letting of said subjects, in particular by lease dated May 2009, was in breach of the terms of the Regulations.

3.           The defenders' licensing committee in coming to its decision did not take account of irrelevant material.

4.           The defenders' licensing committee did not reach its decision on the basis of incorrect material facts.

5.           The defenders' licensing committee in coming to its decision did not make any error in law.

6.           The defenders' licensing committee did not act in breach of natural justice.

7.           The defenders' licensing committee in coming to its decision did not exercise its discretion in an unreasonable manner.

8.           The second pursuers' appeal is incompetent in respect that she has made no application to the defenders and has sustained no refusal.

 

Accordingly, Repels pursuers' pleas in law 1, 2, 3, 4, 5 and 6, Sustains defenders' pleas in law 1, 2, 3, 4, 5 and 6;

 

Refuses the first pursuer's appeal and dismisses his application;

 

Dismisses the second pursuer's appeal as incompetent;

 

Finds the first pursuer liable to the defenders in the expenses of this action, as taxed; Allows an account thereof to be lodged and remits same when lodged to the Auditor of Court to tax and report;

 

Finds no expenses due to or by the second pursuer.

 

Sheriff Malcolm Garden

Note

[1]        This action is an appeal under the Civic Government (Scotland) Act 1982 against the decision of the local authority, Aberdeen City Council, to refuse to grant a licence for a house of multiple occupation in terms of the Civic Government (Scotland) Act 1982 (Licensing of Houses in Multiple Occupation) Order 2000. The refusal was on the grounds, set out in Article 5(3)(a)(ii) of Schedule 1 to the Act, namely that in the opinion of the licensing committee Mr David Thomson was not a fit and proper person to be the holder of the licence. The committee were required by Mr Thomson to provide a Statement of Reasons for their decision, which they did, (production 6/2/3). The pursuers then proceeded to lodge this appeal.

 

[2]        Appeal in this case lies against the decision of the licensing committee and not against the terms of the Statement of Reasons, although clearly that Statement of Reasons is relevant in determining the basis of the committee's decision. In this case the Statement of Reasons has been prepared, in error, on the basis that the application had been submitted in the names of both Mr Thomson and his wife. This is inaccurate. The Statement of Reasons, when read accurately, undoubtedly includes Mrs Thomson in its narration. Taken in isolation and read strictly, it indicates that she was also deemed to be an unfit person to hold a licence. It cannot, however, be taken in isolation as it is the decision against which the appeal lies rather than the explanation of that decision. Any attempt by the defenders to make a finding against Mrs Thomson would be wholly incompetent as she was not an applicant. There is no basis for her appeal and it is accordingly incompetent and falls to be dismissed. I do not, however, consider it unreasonable for her to have sought to challenge an official document from the defenders suggesting, albeit erroneously, that she was subject to the decision. Whilst that might well have been dealt with otherwise than by an incompetent appeal, given that her inclusion in the appeal has involved little, if any, additional expense it is, in dismissing her appeal, inappropriate to make any award of expenses against her.

 

[3]        When this case called before me, evidence was led from the first pursuer in support of his appeal and from Mrs Brenda Flaherty, the clerk to the defenders' licensing committee, in support of their decision. I found Mr Thomson to be a witness lacking in credibility and reliability. His evidence was inconsistent. It digressed from his stated written position. His difficulty arises from his persistent attempts to justify a wholly untenable position. It was clear from his evidence that throughout the history of this matter he has sought to justify his position by blaming others and to dismiss points arising against him by unjustifiable and inappropriate pedantic reasoning.

 

[4]        By contrast I found the evidence of Mrs Flaherty to be entirely credible and reliable. She gave her evidence in a balanced fashion. She even went as far as stating that notwithstanding the way in which Mr Thomson had approached the issue, she would have been inclined to grant the application to ensure that the premises were properly regulated.

 

[5]        In his address to the defenders' licensing committee and in his evidence to this court, Mr Thomson sought to draw a comparison between his approach to this matter and the issue of avoidance and evasion of taxation. In this case, he could have avoided the requirement for a licence had he chosen to lease his property to a religious community or to a family. What he could not do legitimately was to lease his property to six students under a pretence, the terms of which varies at different points in his correspondence and evidence, that they were either or both a religious community and a family. In evidence, Mr Thomson accepted that he had advertised the property as suitable for students. In his submission to the committee he confirmed that his portfolio involved investment in student flats yet up to the point of final submissions he continued to maintain his position that his actions had not been in breach of the Regulations.

 

[6]        In his written appeal, Mr Thomson states clearly that his tenants are not members of the same family. Notwithstanding that position he continued in evidence to claim that they could be regarded as what he described as "an unconventional family", speculating on the possibility of their relationships and postulating that it was not for him to enquire about any such relationships. Article 2(5) of the Regulations defines what constitutes a family. There was never a realistic prospect of six individual students normally resident in different areas of the United Kingdom and Ireland constituting a family. Mr Thomson's attempts to justify his position on that point are ridiculous.

 

[7]        The main thrust of Mr Thomson's position was that he claimed the group to be a religious order. It was his position that it was for the defenders to supply a definition which showed that the tenants did not so qualify. This position is clearly wrong. As can be seen from his own productions the defenders, on 9 October 2009, formally drew to his attention the definition contained in the Regulations and confirmed the defenders' view that his circumstances did not comply. Notwithstanding that he presumably was already aware of the terms of the Regulations, having decided to seek to proceed in the way that he did, and having had it drawn to his attention that in the opinion of the defenders this was inappropriate, he continued to pursue this line up to the point of submissions at this hearing. The Regulation requires that the occupation must be by a religious community, which might or might not be the same thing as a religious order, with a principal occupation of prayer, contemplation, education for the relief of suffering. Even if, as suggested by Mr Thomson's solicitor, that list is to be interpreted as disjunctive, the reference to education would require to involve a primary and common religious element which is plainly absent from his scheme.

 

[8]        Mr Thomson was unable to confirm what religious order or community it was claimed was the subjects of the lease. The lease document does not identify such community. He was unable to confirm the religion of any of the six tenants. It was his view that their failure to organise themselves into such order was not his fault. He placed considerable weight on the terms of his lease. Therein, Article 8, it was a condition of the tenancy that the six persons "agree to live as one religious order/family in a way that maintains exemption from the local authority's Homes of Multiple Occupancy Regulations." Neither he nor his solicitor could adequately explain the meaning of that requirement. In particular whether it required the persons to live both as a religious order and a family or whether it was open to them to choose either option. He could not specify what he required them to do other than what was necessary to avoid (his word) the terms of the Regulations. He did not, despite his pedantic approach to other issues, address the question of the use of the phrase "agree to live" rather than "living."

 

[9]        The level of Mr Thomson's duplicity in this matter can be seen from production 5/1/15 which includes an e-mail message sent by Mr Thomson to a council official on 30 September 2009. Therein he implies that the tenants are a Mormon family maintaining a Christian community guided by the Bible and the Book of the Mormon and further includes himself in their activity by stating "We have a retreat in Utah where they can also pray, study and worship". In evidence, Mr Thomson indicated that he was not a Mormon and was unable to suggest that any of his tenants had agreed to live as a Mormon community. I fully accept that the letter does not specifically state that the tenants, with or without Mr Thomson, were forming such a community but the implication is entirely clear and in my view comprises a deliberate attempt to mislead the council official.

 

[10]    In considering the conduct of the committee hearing I am satisfied from the evidence of Mrs Flaherty that her handwritten contemporaneous note of events (production 5/1/9) is accurate as is that of her colleague (production 5/1/8), although neither are complete records. I prefer her evidence to that of Mr Thomson that although he may well have been guided by the script set out in production 5/1/22, he did not stick precisely to the wording thereof. In particular I am satisfied from her evidence that Mr Thomson did use the word 'dishonest' rather than the word 'evil' which appears in the script. Accordingly to the extent that it has any relevance, I am satisfied that it was he who introduced that word to the committee prior to their making their decision. In any event, I do not think that the use of the word dishonest in the committee's Statement of Reasons indicates that they had taken account of matters raised at their previous meeting and therefore they were not considering the application as of new.

 

[11]    I accept that during the course of the appeal a far greater depth of information was supplied to the court than was available to the committee on the date of its decision. That material, although largely led by the first pursuer, fully confirms that the committee's view was justified although it was not part of their actual deliberations.

 

[12]    The committee had before it the report from their official (production 5/1/6) which included confirmation that Mr Thomson was leasing the property in such a way as to require an HMO licence unless his claim for exemption applied, and doubting that claim. They had before it the objection from the neighbouring proprietor who confirmed to them that the property was let to six persons. They were aware that there was no HMO licence as the matter before them was an application for such a licence. They heard Mr Thomson's own submissions wherein he introduced the comparison with tax avoidance, denied that he had overstepped the mark, suggested that had he done so the average level of fine was such to indicate it not to amount to a major offence and suggested that the council committee were more dishonest than was he. He suggested that he had been advised to delay his application, a suggestion unsupported by the facts in the case, and that it was accordingly appropriate that he should lease the flat without a licence. He made no reference to the issue of the religious exemption but did refer, on two occasions, to the flat being utilised by students.

 

[13]    The committee, as they were fully entitled to do, asked questions of Mr Thomson. He confirmed that he had indeed asked his tenants to live as a religious community. He stated that he was not aware that they were not doing so because the council had not supplied criteria. In answer to a question "Do you agree that you colluded with the tenants to live as a religious community to evade HMO legislation?" he replied "Yes".

 

Pursuers' submission

[13] The pursuers' solicitor first addressed the issue of the second pursuer's inclusion in the Statement of Reasons. I have set out the position regarding that above.

 

[14] The solicitor submitted that the source of the allegation of dishonesty raised against the pursuer was the letter which the objector had referred to in her submission to the first committee hearing. The reference to that letter was the basis for the successful appeal against the committee's decision. The letter had not been re-introduced at the second meeting. He submitted that Mr Thomson's evidence that he had not used the word dishonest in his submission should be preferred to any suggestion by Mrs Flaherty that he had done so. The reference to dishonesty in the Statement of Reasons and the context in which it appeared demonstrated that the committee had taken into account that material presented to the first meeting but excluded from the second. The question posed by Mr Thomson, "who is more evil?" was a rhetorical question and not one which attributed dishonesty to any party. The councillor's question raising the issues of collusion and evasion did not stem from what had happened at the committee meeting. It was not properly before the committee and arose from the content of the hearing in June 2009. The only source of any suggestion of collusion to evade came from the purported tenant's letter which was not material relevantly before the committee.

 

[15] With reference to the appropriate passages in the Shorter Oxford Dictionary and from internet investigation, the solicitor submitted that whilst the word "evade" could import a connotation of dishonesty it did not necessarily do so and Mr Thomson's explanation that in answering the question he did not intend to accept any imputation of dishonesty should be accepted. Mr Thomson had felt harassed by the questioning. The word "collude" was also one which did not necessarily import dishonesty. He submitted that Mr Thomson's affirmative answer to the councillor's question should not properly be taken as an acceptance of dishonesty on his part. He had not been given a fair hearing as he had been pressed into answering a question on a matter which ought not to have been before the committee.

 

[16] He accepted that the issue of dishonesty had featured in the present hearing. It was accepted that Mr Thomson had required the tenants to live as a religious order and that they had failed to satisfy that requirement. His view of what was required by the legislation might be misguided but was not dishonest. He sought to support Mr Thomson's analogy with taxation. Avoidance of tax involved putting oneself in a position so that tax legislation did not bite. Accountants frequently advised clients on how to regulate their affairs in this way. It was a matter of prudence. Mr Thomson had sought to avoid the requirement for a licence by entering into a lease which would result in a situation which did not require an HMO licence. In the same way that a tax avoidance scheme recommended by accountants would not necessarily be vouched as certain to succeed and might properly be followed and ultimately found to fail that did not mean that the individual involved was acting dishonestly.

 

[17] It could be seen from the circumstances that Mr Thomson had not been underhand. He had approached the council and discussed the obtaining of a HMO licence with them. He had intended to apply. He had done so. He had told the council what he was doing. The spur to make the application was his discovery that the lease was not being operated or used in the manner which he had required. When that came to his attention he made application for a licence.

 

[18] The application had been refused on the basis that Mr Thomson was deemed not a fit and proper person. That view arose at the committee because of the terms of the purported letter from the tenants quoted at the July meeting. He ought not to have been questioned about that matter. Without consideration of that letter the issues could not have been before the committee. It would have been open to the committee to instruct an investigation by their officials. They had not done so. They could have sought evidence from appropriate persons to establish any consideration of dishonesty. They should not have relied on hearsay evidence that he was dishonest and could not, in particular, rely on the letter for the reasons mentioned earlier. It was Mr Thomson's position that the hearing was prejudiced against him. He was not given a fair hearing. Natural justice was not followed.

 

[19] It was accepted on behalf of the pursuer that the family exemption did not apply to the present situation. He submitted that it was perfectly possible that the exemption under Regulation 2(2)(c) could have applied. The tenants were required to live in a religious order in such way as to meet the exemption as framed. The wording of the exemption should be taken as disjunctive. Accordingly, were the tenants residing in a religious community and were their principal occupation to be education then it could apply. This was a possible interpretation. It was now accepted that it was a misguided interpretation but it was not a dishonest one. He submitted that the correct interpretation of clause 8 of the lease (production 5/1/3) was that the tenants could live either as a religious order or a family. It was accepted that the tenants were not in fact a family.

 

[20] He moved the court to sustain pursuers' pleas 1 to 4 inclusive. In so doing the court had a discretion thereafter and he submitted that, as this case had already been remitted back to the defenders' licensing committee who had then demonstrated that they could not consider the application without being affected by their earlier deliberations, the court should exercise its discretion to reverse the defenders' decision as first craved. If that were not to be done the decision should be recalled and the application remitted back to the defenders for further consideration.

 

Defenders' submission

[21] The defenders' solicitor helpfully provided a written submission which she presented to the court. A copy is with the process and can be referred to for greater detail. She submitted that there was no basis for finding that the committee had not considered the application of new. Mrs Flaherty, in her evidence, had confirmed that they had indeed done so. Committee members were fully entitled to answer such questions as they saw fit and take account of the answers thereto. The issue of the religious exemption was raised in the memorandum to the committee from the appropriate official. Mr Thomson had raised the issue of legality by comparing his approach to avoidance of taxation. From the information available to them at the meeting the committee were perfectly entitled to conclude that the first pursuer was being dishonest in seeking a device to circumvent the need for the obtaining of an HMO licence. She submitted that Mr Thomson's explanation that he did not realise the meaning of the critical question put to him was disingenuous.

 

[22] With reference to certain authorities, she submitted that the council's Statement of Reasons had been properly and appropriately constructed. Consideration of the detail in the Statement of Reasons should not be based on a line by line and word by word scrutiny as if they were a Closed Record or Trust Disposition and Settlement. Loosefoot Entertainment Limited v Glasgow District Licensing Board and Another 1991 SLT 843 It was accepted that the Statement of Reasons stated that the applicant was both pursuers but it was clear from the evidence of Mrs Flaherty, the application (production 5/1/20) and the actual determination (production 5/1/21) that only the first pursuer was the applicant and any other references were an error. That did not negate the procedure.

 

[23] During the course of the defenders' solicitor's submission, the pursuers' solicitor clarified that the pursuer no longer sought to found an appeal on the ground that the committee had erred in law. The pursuer did not now maintain that the exemption did exist in the circumstances but it was his position that he thought that it could exist. He now accepted, with the benefit of hindsight, that the factual situation did not meet the terms of the exemption. The solicitor for the defenders did not pursue her submission in respect of error of law on the basis of this concession made by the pursuers' solicitor.

 

[24] With regard to the issue of reasonable exercise of discretion, the defenders' solicitor submitted that the appropriate test was whether the decision was "so unreasonable that no reasonable authority could have reached it". Ranachan v Renfrew District Council 1991 SLT 625 It was not appropriate for the court to substitute its own view for that of the licensing authority. It was a matter for the local authority to consider what weight should be attached to any material of significance and of any balancing factors.

 

[25] In this case, the claim for exemption was patently untrue. Mr Thomson had sought to implicate his tenants in the device he was using to avoid the necessity of having a HMO licence. He had maintained, up until the end of the appeal proceedings, that he had been right to do so. In his evidence to the court he had continued to insist on an entitlement to claim an exemption through having tenants sign an appropriately worded clause, regardless of the factual situation.

 

[26] She submitted that there was adequate material before the committee on 15 September in the description by the first pursuer of how and why he claimed an exemption from the licensing regulations for the committee to come to a view that this was a fiction, that he had been dishonest and that he showed a poor attitude to licensing regulations. There was thus sufficient material before them to conclude, as they had done, that the first pursuer was not a fit and proper person to hold a licence. His own submission and his answer to the critical question raised were sufficient. She invited the court to reject the second pursuer's appeal as incompetent and to refuse the first pursuer's appeal. Accordingly, the pursuers' pleas-in-law should each be repelled and defenders' pleas 1, 2, 3, 4, 5 and 6 should be upheld and the application dismissed with expenses against both pursuers.

 

My Decision

[27] In assessing this appeal, I am satisfied that the general test is whether the course of action followed by the defenders and their decision was one that no reasonable authority, having taken account of all relevant circumstances, could have adopted or decided. It is not for this court to substitute its own view on the application. It is unfortunate in this case that it appears that Mr Thomson had taken all necessary steps to put the property into an appropriate condition for the granting of an HMO licence. It may be that a differently constituted committee might have reached a different view on the application by placing greater weight on that situation and less on Mr Thomson's own, clearly remarkable, approach to the legislation and to the defenders and its officials. I am satisfied, however, that the defenders' licensing committee were fully entitled in the whole circumstances to come to the view that they did and cannot fault their decision that Mr Thomson's actings and approach make him an unfit person to hold an HMO licence.

 

[28] At the very end of the proceedings, Mr Thomson, through his solicitor, finally conceded that the exemption claimed by him did not apply. He continues, however, to claim that it could have applied. I disagree with that view. From the outset of this matter, it is clear that Mr Thomson sought to manufacture a situation which, in his opinion, could meet the terms of the available exemption. He did not seek to lease his property to a religious community nor to a family. He sought to lease his property to a group of six unrelated students and then to create a paper device by which he could pass them off under one, other or both of these exemptions. His attempt to pass this off as equivalent to tax avoidance is simply wrong. Although the analogy is not entirely helpful, it is not possible to legitimately avoid a tax liability by classifying an item of income or expenditure as something which it is not. As I have identified earlier, it was clear from the evidence of Mr Thomson that he had sought to mislead the defenders' officials during the course of his correspondence with them. This itself was not, of course, information available to the committee but was led in evidence by Mr Thomson in these proceedings.

 

[29] The arguments presented by Mr Thomson during his evidence and on submission involve his seeking to draw conclusions from the terms of the Statement of Reasons to justify his claim that the defenders' licensing committee took into account factors which they could only have known from their earlier deliberations. I do not accept that is correct. As set out above, it seems to me that the information was before them in the form of the memorandum from the appropriate official, the letter of complaint and from Mr Thomson's own submission to them. The memorandum confirms that he was operating without an HMO licence on the basis of his claim for religious community and family exemption. The article in the memorandum, while not stating so in terms, does make it clear that the claim was not accepted by officials. In his own submission to the committee Mr Thomson identifies numerous issues including those of honesty and indeed criminality. His suggestion that criminality can be measured by reference to the level of an average fine is hardly fitting of a licence holder. It would serve little purpose for me to comment on the more fanciful propositions contained in that submission. I accept the evidence from Mrs Flaherty that he made specific reference to the issue of dishonesty. There is, therefore, no basis for the view that the councillor's question concerning evasion and collusion could only have been generated from material referred to at the earlier meeting. I do not consider that the Statement of Reasons read appropriately demonstrates that the committee has taken account of any irrelevant material. That statement should not be examined with extreme precision.

 

[30] With regard to the critical question and answer, whilst I can accept that on reflection Mr Thomson regrets having answered in the affirmative and that perhaps, had he been given more time to consider the question he might have qualified his answer, the fact of the matter is that he did answer in the affirmative. The suggestion that the words "evade" and "collude" can, with reference to their dictionary definitions, be viewed as other than indicative of dishonesty is particularly unconvincing. The meaning of the question is entirely clear in the context in which it was asked. It was Mr Thomson who introduced the concept of avoidance and evasion. Even at its most benign it is difficult to attribute anything other than dishonesty to the word "collude". In my opinion, the defenders' committee were fully entitled to regard Mr Thomson's answer to that question as an admission of dishonesty.

 

[31] Having considered the terms of the defenders' Statement of Reasons, it appears to me to be a reasonable summary. In particular the final paragraph wherein the committee summarise their findings contains conclusions which are entirely reasonable and are appropriately drawn from the information legitimately available to the committee and from the content of Mr Thomson's address and answers.

 

[32] I am satisfied that there is no basis for the suggestion that the defenders took account of irrelevant material. I am satisfied that the defenders have not based their decision on any incorrect material facts. It is conceded that the defenders were not in error in applying their understanding of the appropriate law. I can see nothing in the approach of the committee to justify a claim of breach of natural justice. Mr Thomson was given an opportunity to address the committee and explain his position. It is entirely clear from their Statement of Reason that the committee gave careful consideration to the whole content of his address. It would, as claimed by Mr Thomson's solicitor, have been open to the committee to instigate further investigation but they were not invited to do so by Mr Thomson nor would it appear from the information which was available to him that such an investigation was necessary or appropriate.

 

[33] Whilst a differently constituted committee might have come to a different view it cannot be said that the defenders' licensing committee exercised their discretion in an unreasonable manner. The conclusions which they have drawn from Mr Thomson's conduct and the content of his address appear entirely justified. His own actings and attitude have quite properly led them to the view that Mr Thomson is someone who has a poor attitude to regulation and licensing, has shown a blatant disregard for the law and would disregard the terms and conditions of any licence should that so suit him. Mr Thomson has failed to establish any of the criteria set out in article 18(7) of Schedule 1 to the Civil Government (Scotland) Act 1982. His appeal must accordingly fail.

 

[34] I consider it inappropriate for there to be a finding of expenses against the second named pursuer for the reasons I have set out above. I find the first named pursuer liable to the defenders in the expenses of these proceedings he having failed in this appeal.

 

 

 

Sheriff of Grampian Highland and Islands at Aberdeen.

23, March 2011.

 

List of Authorities referred to by the defenders

 

1.                 Loosefoot Entertainment Limited v Glasgow District Licensing Board and Anor. 1991 SLT 843.

2.                 Ranachan v Renfrew District Council 1991 SLT 625.

3.                 Hughes v Hamilton District Council 1991 SLT 628.

4.                 Lettiff v Motherwell District Licensing Board 1994 SLT 414.

5.                 Middleton v Dundee City Council 2000 SLT 287.

6.                 Ritchie v Aberdeen City Council 2009 GWD 34 - 587.

7.                 THEM PROPERTIES LLP v Glasgow City Council 2010 CSIH 51.