MARTIN McCOLL LIMITED AGAINST WEST DUNBARTONSHIRE LICENSING BOARD
SHERIFFDOM OF NORTH STRATHCLYDE AT DUMBARTON
[2017] SC DUMB 27
B420/16
JUDGMENT OF SHERIFF PRINCIPAL DUNCAN L MURRAY
In Appeal by
MARTIN MCCOLL LIMITED
Pursuer
Against
WEST DUNBARTONSHIRE LICENSING BOARD
Defender
Pursuer: Skinner
Defenders: Blair
DUMBARTON, 19 April 2017
Background
[1] This is an appeal under Section 131 of the Licensing (Scotland) Act 2005 (“the Act”) against the defender’s decision to refuse an application made by the pursuer for a provisional licence at 19 Sylvania Way South, Clyde Shopping Centre, Clydebank (“the premises”). The premises are operated by the pursuer as a small convenience store. The application was to allow the sale of alcohol within a capacity of 7.9 square metres at the premises.
[2] There was an objection to the application from John Russell, Head of Mental Health Learning Disabilities and Addiction Services, Alcohol and Drug Partnership. There was also a representation from Police Scotland, which detailed convictions relating to the pursuer. The application was considered by the defender at a meeting held on 14 June 2016. As lodged, the application was for a licence from 10am to 10pm each day; however at the meeting the hours sought were restricted to 10am to 8pm each day. Following submissions by the agent for the pursuer, the defender refused the application. A statement of reasons was issued by the defender dated 1 July 2016. This narrated that the application was refused on two grounds, namely those laid down in section 23(5)(c) of the Licensing (Scotland) Act 2005 (the 2005Act) i.e. inconsistency with licensing objective in protecting and improving public health and in terms of section 23(5)(e) i.e. overprovision.
- [3]The 2005 Act introduced a new approach to licensing.In particular, Section 7 required each Licensing Board to include in its policy statement a statement as to the extent to which the Board considers there to be an overprovision of licensed premises or overprovision of licensed premises of a particular description in any locality within the Board’s area.
[4] In terms of Section 6 of the Act the defender has adopted a policy on overprovision. This was arrived at after an extensive consultation process undertaken between 2012 and 2013 by the defender. The 2013–2016 policy is to a substantial extent a development of the previous 2010–2013 policy. The 2013-2016 policy added some further localities where overprovision was identified. In addition, the 2013-2016 policy included a provision in relation to an exception being considered where the grant of a new licence might create additional jobs. The policy on overprovision is to be found at part 4 of the policy. The intermediate data zone, (IDZ 2), of Dalmuir was again treated as being overprovided with convenience stores as it had been in the 2010–2013 policy. The policy identified that “off-sales and local convenience stores” fell into the overprovision category.
[5] The statutory framework is set out in the 2005 Act. The relevant sections provide as follows:
“4 The licensing objectives
(1) For the purposes of this Act, the licensing objectives are-
(a) preventing crime and disorder,
(b) securing public safety,
(c) preventing public nuisance,
(d) protecting and improving public health
(e) protecting children from harm…
6 Statements of licensing policy
(1) Every Licensing Board must, before the beginning of each 3 year period, publish a statement of their policy with respect to the exercise of their functions under this Act during that period (referred to in this Act as a “licensing policy statement”)….
(3) In preparing a licensing policy statement or a supplementary licensing policy statement, a Licensing Board must—
(a) ensure that the policy stated in the statement seeks to promote the licensing objectives…
(4) In exercising their functions under this Act during each 3 year period, a Licensing Board must have regard to the licensing policy statement, and any supplementary licensing policy statement, published by the Board in relation to that period.
7 Duty to assess overprovision
(1) Each licensing policy statement published by a Licensing Board must, in particular, include a statement as to the extent to which the Board considers there to be overprovision of—
(a) licensed premises, or
(b) licensed premises of a particular description,
in any locality within the Board's area.
(2) It is for the Licensing Board to determine the “localities” within the Board's area for the purposes of this Act.
(3) In considering whether there is overprovision for the purposes of subsection (1) in any locality, the Board must—
(a) have regard to the number and capacity of licensed premises in the locality, and
(b) consult the persons specified in subsection
(4) Those persons are: (a) the chief constable; (b) the relevant health board; (c) such persons as appear to the board to be representative of the interests of – 1. holders of the premises licences in respect of premises in the locality, persons resident in the locality; and … (d) such other persons as the board thinks fit …”
Section 23 of the 2005 Act provides:-
“…(4) The Board must, in considering and determining the application, consider whether any of the grounds for refusal applies and—
(a) if none of them applies, the Board must grant the application, or
(b) if any of them applies, the Board must refuse the application.
(5) The grounds for refusal are—
…
(c) that the Licensing Board considers that the granting of the application would be inconsistent with one or more of the licensing objectives,…
(e) that, having regard to the number and capacity of—
(i) licensed premises, or
(ii) licensed premises of the same or similar description as the subject premises,
in the locality in which the subject premises are situated, the Board considers that, if the application were to be granted, there would, as a result, be overprovision of licensed premises, or licensed premises of that description, in the locality.”
In relation to appeals Section 131 provides:-
“(3) The grounds on which a Licensing Board's decision may be appealed under this section are—
(a) that, in reaching the decision, the Licensing Board—
(i) erred in law,
(ii) based their decision on an incorrect material fact,
(iii) acted contrary to natural justice, or
(iv) exercised their discretion in an unreasonable manner,…
(5) Where the sheriff principal or, as the case may be, sheriff upholds an appeal against a Licensing Board's decision under this section, the sheriff principal or sheriff may—
(a) remit the case back to the Licensing Board for reconsideration of the decision,
(b) reverse the decision, or
(c) make, in substitution for the decision, such other decision as the sheriff principal or sheriff considers appropriate, being a decision of such nature as the Licensing Board could have made.”
Section 142 Guidance provides:
“(1) The Scottish Ministers may issue guidance to Licensing Boards as to the exercise of their functions under this Act.
(2) The Scottish Ministers may modify any guidance issued by them under subsection (1).
(3) Each Licensing Board must, in the exercise of their functions under this Act, have regard to any guidance issued to them under subsection (1).
(4) Where a Licensing Board decides not to follow any guidance issued under subsection 1(1), the Board must give Scottish Ministers notice of the decision together with a statement of the reasons for it.”
Submissions for the pursuer
[6] Counsel for the pursuer criticised the decision of the defender on four grounds: - firstly, the defender erred in law by exercising its discretion unreasonably in refusing the application on grounds of overprovision; secondly, the defender erred in considering that the application should be refused on the grounds of protecting and improving public health; thirdly, the decision of the defender was irrational because at the same meeting the defender had granted a broadly similar application by the Co-op; and fourthly the defender had failed to provide adequate reasons for their decision.
[7] The first ground on which the pursuer’s counsel relied was that the defender erred in law et separatim exercised their discretion in an unreasonable manner. It was submitted that they failed to apply the statutory test, laid out in section 23(5)(e), to the application; they failed to identify and to have regard to the description, numbers and capacity of the licensed premises in the locality which they took into account. They based their decision to refuse the application on the ground of overprovision entirely on the application of their statement of licensing policy. It was submitted that being contrary to a policy is not a ground for refusal, but merely a factor to which the defender must have regard when considering the application, in terms of section 6(4) of the 2005 Act,
[8] It was accepted the defender correctly selected a locality, but submitted to be unclear under which leg of section 23(5)(e) the defender was proceeding and what test they were applying. Stating they had regard to:
“the number and capacity of licensed premises in the locality in which the subject premises are situated.”
appeared to indicate that they are selecting section 23(5)(e)(i) i.e. all premises. However in the statement of reasons the defender states in the following line that they:
“were satisfied that if the application were to be granted there would, as a result, be overprovision of licensed premises of the same or similar description as the subject premises in the locality in which the subject premises are situated.”
This suggested that overprovision was being determined in the context of specific premises types - section 23(5)(e)(ii). The defender further confused identification of the basis on which overprovision was being cited as a result of the reference in the statement of reasons to there being three restaurants which were no longer operating in this IDZ area. Unless the defender had adopted an “all premises approach” the reference to three restaurants no longer operating would be wholly irrelevant, as the application is for a convenience store operation, not a restaurant and restaurants are not of a category of premises identified in the policy as over provided.
[9] Thus the statement of reasons was defective as it failed to make clear whether the defender relied on over provision of licensed premises as a whole or of off-sales type premises. Further in neither case did the statement of reasons set out the necessary specification of the extent of over provision. The figures relied upon to make the assessments of overprovision were missing from the statement of reasons. It was not sufficient for the defender to make reference to their policy. It was irrelevant for the defender to seek to explain in their answers and before the court details of the numbers and types of premises they had regard to, which are not provided in the statement of reasons. Loosefoot Entertainment Ltd v City of Glasgow Licensing Board 1991 SLT 843 at 846 –I).
[10] Criticism was also made of the defender for not having given an indication in the course of the hearing that over provision was a concern to them, so that this could have been addressed by the pursuer’s agent.
[11] Secondly, the defender erred in law et separatim exercised their decision in an unreasonable manner in failing to apply the proper statutory test to the application. It was submitted they had regard to the generalised health statistics for the area without making any causal link between the figures and the premises. So the defender had reached a decision for which there was no properly articulated factual basis. It was noted that in terms of protecting and improving public health, the reasons state:
“The board were of the view that in the light of the extremely poor health statistics within West Dunbartonshire as a whole and the fact that grant of the application would result in increased sale of alcohol, availability and consumption and the relationship from studies between the availability of alcohol and alcohol related health harms, that the grant of the application would be inconsistent with the licensing objective of ‘protecting and improving public health’. Accordingly the Board were satisfied that this ground of refusal also existed in terms of section 23(5) (c) of the Act.”
The problem of linking prejudice to health objectives to particular premises was recognised in the Scottish Government consultation paper “Further options for Alcohol Licensing Consultation 2012” Para 97
“…in terms of the public health objective it is very difficult, if not impossible in most cases to make a causal link between where alcohol is sold and where it is consumed.”
This led to the passing of section 55 of the Air Weapons and Licensing (Scotland) Act 2015 which allowed boards to have a whole area overprovision policy. This provision, however, only came into force on 30 September 2016 and was not applicable when the application was considered by the defender.
[12] The proper application of the test required that the Licensing Board was satisfied that the particular application would be inconsistent with the objective of “promoting or improving public health”. As there was no evidential basis for the defender to so find, there was no valid basis on which the defender could have refused the application as being inconsistent with the licensing objective, namely protecting and improving public health (section 23(5)(c)).
[13] Thirdly, the defender acted irrationally, unfairly, unreasonably, and contrary to natural justice in refusing the application when, at the same meeting, very shortly after refusing the pursuer’s application, they granted an application for an off-sales premises licence for a Co-op store for a broadly similar operation, located across the road from the pursuer’s premises, in the same IDZ. Although it was not for the court to scrutinise all decisions of a Licensing Board, to ensure uniformity, such a clear volte-face demonstrated obvious unfairness and unreasonableness in the exercise of the defender’s discretion. The same conclusion should be reached in the present case as had been reached by the Inner House in Cashley v Dundee City Council 1994 SLT 1111 where the court found that the policy applied to taxi licence applications appeared to have been applied in an arbitrary fashion and in the absence of a satisfactory explanation the authority had exercised their discretion in an unreasonable manner.
[14] The defender’s efforts to justify the distinction as set out in their answers and subsequently developed in submissions were irrelevant. Whether or not the Co-op had previously had a licence was simply of no moment. Neither was what the Co-op did in terms of assistance to the broader community. In relation to the Co-op increasing employment by offering additional jobs this was wholly irrelevant to the statutory test. It did not relate to a purpose which the defender was entitled to take account of. It mattered not that it was included as a factor within the defender’s policy. The purpose of a policy aim to promote health benefits was intended to relate to those consuming alcohol and any health benefit to an employee engaged in the sale of alcohol was irrelevant. The shorter licensing hours which were to cease at 5.00pm was only relevant if it was suggested in the reasons for refusing the pursuer’s application was because of some deleterious effect during the additional three hours of opening until 8.00pm as being a basis for the distinction. It was irrational for the defender to grant one of the applications and not the other.
[15] It was also submitted the defender had failed to adequately articulate their reasons for refusing the application. Reference was made to the classic formulation of Lord President Emslie, in Wordie Property Company v Secretary of State for Scotland 1984 SLT 345 at page 347, endorsed in a licensing context in Ritchie v Aberdeen City Council 2011 SC 570, of the duty of decision makers in a situation such as the instant case to give clear expression of their reasons. The statement of reasons, required to identify what were determined by the defender to be material considerations, set out how they had been evaluated and the essence of the reasoning which led to the decision. The inadequacy of the statement of reasons was manifest in the failure to explain when considering overprovision the types of premises which were “the same or similar”; the numbers and capacities of relevant premises taken into account by them; and why having regard to these numbers and capacities the grant would result in overprovision. In relation to the objective of protecting and improving public health the defender failed to identify in the reasons why the grant of the particular application for this small store run by a nationally known operator would prejudice the health of local people (beyond the fact that it sold alcohol).
[16] The pursuer’s counsel submitted a finding in their favour should result in my granting the application. He submitted it was difficult to see what harm would be caused by the grant of this small application to enable what was submitted to be a highly reputable UK operator to offer a small alcohol provision to complement its offering at the premises. Under reference to the decision of Doyle v Glasgow District Council 1995 SLT 327, it was submitted it was impossible to re-create the circumstances that existed at the preceding application. The application should be granted, as had been the outcome in Doyle, because the pursuer’s position in any remit would be prejudiced by the subsequent grant of licensed premises to the adjacent Co-op premises. At the hearing of a remitted application the defender was bound to take account of the increased number and capacity of off-sales which now included the Co-op. As a consequence the application could not be validly remitted back to the defender. Accordingly the appropriate outcome of the appeal should be for the application to be granted.
Submissions for the defender
[17] The defender’s counsel invited the court to uphold the defender’s pleas-in-law and repel the plea-in-law for the pursuer. The pursuer was a national chain and could be understood to be a sophisticated commercial operator. It was submitted for the defender that the pursuer was not ambushed in the sense identified in Catscratch Ltd v City of Glasgow Licensing Board (No 2) 2002 SLT 503 Lord Johnstone at paragraph 13. An agent is assumed to be aware of the case against their client in a policy case. In this case the pursuer and their agents were aware of the policy which created a rebuttable presumption against a grant on grounds of overprovision. The pursuer’s agent should have been well aware that the defender had a view on numbers and capacity. Indeed as recorded in the statement of reasons of 1 July 2016 the pursuer recognised the existence of the policy, sought to be made an exception to the policy and recognised that the presumption of refusal where there was overprovision was difficult to rebut. In doing so the pursuer did not seek to argue that there had been such a material change in numbers and capacity in IDZ 2 Dalmuir such that the policy ought not to be applied. It was submitted that the numbers in relation to capacity or overprovision had only changed by tiny amounts from 15 December 2015 to 16 June 2016. The number of off-licence premises of 9 had not changed at all. Even if the defender ought to have raised the numbers and capacity, any change in numbers was minimal and would have had no effect on the decision reached. Malloch v Aberdeen Corporation 1971 SC (HL) 85 Lord Wilberforce at p 118.
[18] In Kell (Scotland) Ltd v City of Glasgow Licensing Board 2010 SLT (Sh Ct) 107 Sheriff Principal Taylor had correctly recognised that under the 2005 Act a Licensing Board required to have a policy statement and it was reasonable for a Board to refuse an application because it breaches the policy. Cinderella’s Rockerfella’s v Glasgow District Licensing Board 1994 SCLR 591 (decided under the 1976 Act) demonstrated the breadth of discretion that a Board enjoys in developing a policy and that a Board had a role to play in limiting the adverse consequences of the consumption of alcohol. The policy in that case was extra-statutory, and even greater substance should be given to a policy-based decision where the policy has statutory force, as has the defender’s 2013-2016 policy. The Cinderella’s Rockerfella’s v Glasgow District Licensing Board decision also recognised that general steps can be taken to deal with problems which are general in nature. Thus the defender in the instant case was entitled to take general steps in the form of a policy on overprovision as a means of securing licensing objectives. Indeed section 23(5)(e) imposes a statutory requirement for a Board to have a policy on overprovision. It was also said to follow from the Cinderella’s Rockerfella’s decision that it is not for the court to assess the efficacy of the policy. Thus, in Ahmed v North Lanarkshire Council 1999 SLT 1064 the court accepted that the Board proceeded in the expectation of compliance with any requirements of the policy, but should consider any plea for exemption on its merits. It was submitted it was apparent that the Board had regarded the guidance issued under section 142 of the 2005 Act when finalising the policy and, in so doing, they were perfectly entitled to also set out in the policy a possible basis, such as increased employment, for departure from the policy.
[19] An example where inconsistency with policy can be sufficient to found a refusal on any of the grounds in section 23(5), for new licences, was found in Kell (Scotland) Ltd or WWCM Ltd v Renfrewshire Licensing Board, 3 November 2010, Paisley Sheriff Court per Sheriff Principal BA Kerr QC. This proposition was also consistent with Calderwood v Renfrewshire Council 2004 SC 691, which dealt with how licencing polices are to be approached; as well as the observations of Lord Weir in Elder v Ross and Cromarty LB 1990 SLT 307, referred to in Kell (Scotland) Ltd v City of Glasgow Licensing Board (supra), on how policy is to be considered.
[20] It would have been evident to the defender particularly given the objection received from the Mental Health Learning Disabilities and Addiction Services, Alcohol and Drug Partnership that there are health issues associated with alcohol consumption. It is plainly apparent that the defender was well aware that there was overprovision within IDZ 2. Indeed it was recognised by the pursuer’s agent. The operating plan in the application described the premises to have the character of a convenience store, which was clearly subject to over-provision in terms of the policy. The statutory guidance on establishing a policy makes it clear that “inverts” the previous reactive approach of the 1976 Act. The guidance which, in terms of section 142 of the 2005 Act, Licensing Boards are to have regard to reinforces the intention behind the 2005 Act of driving public interest objectives and seeking to provide a clear basis for over-provision decisions. Numbers and capacity are one consideration in such decision-making. Paragraph 33 of the guidance:
“… requires Licensing Boards to take a pro-active position on overprovision and identify those localities in which it would not propose to grant new licences or licences for premises of a particular description;
• allows Licensing Boards to take account of the ‘particular description’ of premises (that is to say, their styles of operation) when assessing overprovision; and;
• directs Licensing Boards to have regard to the number and the capacity of licensed premises in localities. “
The fact that others may take a different view does not make that view so unreasonable that no Board could hold it. That is the test (Hughes v Hamilton DC 1991 SC 251; Ranachan v Renfrew District Council 1991 SLT 625), not least as in an area like overprovision where a Licensing Board is assumed to know its area and is assumed to have experience of matters like overprovision – see Latif v Motherwell DLB 1994 SLT 414.
[21] It was evident that outlet density had reached a stage where mitigation of adverse effects was needed. Section 23(4) read with section 23(5) requires a Board to refuse an application if there is overprovision unless that presumption can be rebutted. It was rational for the defender to have a concern that further expansion of outlet density was problematic. Such action was consistent to the objective in section 4(1)(d) of the Act: “protecting and improving public health”. The court requires to be satisfied that matters are taken into account; it is not part of the court’s function to evaluate the weight given to particular matters. Tesco Stores Ltd v Secretary of State for the Environment [1995] 1 WLR 759. The defender plainly had regard to the numbers and capacity, thus fulfilling their duty under section 23(5)(e). The defender was entitled to have regard to the issue of numbers and capacity on clear policy which was not challenged. It was for the defender to allocate how much weight was to be afforded to that and given no contrary argument was made about an absence of overprovision by the pursuer, no fault, error or omission may be attributed to the defender.
[22] The use of “ensure” in section 6(3)(a) imposed a stronger duty to secure the licensing objectives than one of simply having regard to them in the hierarchy of considerations. A Licensing Board must aim to achieve particular outcomes, but in seeking to achieve particular outcomes that does not prevent a policy from also taking into account other considerations or aims. The statutory duty to assess over-provision in section 7 was fulfilled by the defender in this case. There was no dispute about locality, the defender had established an approach to overprovision of licenced premises of particular descriptions. The 2010-2013 policy had found there to be overprovision of off-sales and local convenience stores (para 24) and that was also the position as seen in the 2013-2016 policy (para 25). The defender had had regard to the submissions made by the pursuer but was not persuaded to depart from the policy. The policy was an expression of the defender’s view of how the licensing objectives might be met. The defender was entitled to give considerable weight to and to apply the policy with a view to achieving the licensing objectives, unless they were prepared to make an exception.
[23] On the challenge to the adequacy of the reasons provided by the defender reference was made to the Inner House decision in Ritchie v Aberdeen City Council (supra) at para 12
“….But his statement of reasons must identify what he decided to be the material considerations; must clearly and concisely set out his evaluation of them; and must set out the essence of the reasoning that has led him to his decision.”
The relevant facts in Calderwood v Renfrewshire Council 2004 SC 691 were similar to the instant case. A number of factors could be taken from the decision. The statement of reasons made reference to the submissions made by the applicant and explains that the Board was not persuaded to make an exception to the policy. The Extra Division held practical onus was on the applicant to persuade the Board to overturn the policy objection. The reasons for the Licensing Board’s decision were capable of being adequately expressed by the simple reference to their being a policy and that the authority was not persuaded that a case for an exception should be made. As in Calderwood the decision of the defender should be upheld.
Discussion and decision
[24] Both parties made reference to the statutory requirement in terms of section 6 of the 2005 Act to consult, then prepare and publish a licensing policy every three years. They also noted the need for Licensing Boards to have regard to the guidance published by Scottish Ministers in terms of section 142 of the 2005 Act. The guidance is instructive about the practical application of the 2005 Act. The statement of licensing policy should seek to promote the five licensing objectives set out in the Act. The statement of policy may set out a general approach in the making of licensing decisions but must not ignore, or be inconsistent with, the provisions of the Act. Paragraph 23 of the guidance provides:
“ Ministers recommend that statements of policy should provide clear indications of how Licensing Boards will take into account other matters relating to alcohol, for example: local crime prevention; community safety strategies; health, particularly in relation to the Scottish Executive Action Plan on Alcohol Problems; planning; transport; tourism; race equality schemes; cultural strategies; and any other plans introduced for the management of town centres and the night-time economy when developing policy statements. Some of these issues may well not directly relate to the promotion of the five licencing objectives, but might indirectly impact upon them.”
Overprovision
[25] Section 7 of the 2005 Act imposes the duty on a Licensing Board to assess overprovision. Section 23(5) sets out grounds for the refusal of a premises license, and subsection (e) addresses overprovision. A premises licence may therefore be refused - if on the basis of the number or capacity of licensed premises or of licensed premises of the same or similar description overprovision would result if the application were granted. The policy statement should include a statement on the policy on overprovision of licensed premises, or particular types of premises, as required by Section 7 of the Act and which localities have been (i) determined to have been overprovided for by the Board; or (ii) are approaching overprovision.
[26] Paragraph 54 of the guidance provides:
“Where a Licensing Board’s policy statement has concluded that in a particular locality there is an overprovision of licensed premises, or licensed premises of a particular description, an application for a new premises license or for variation of an existing license in that locality should normally be refused on the ground provided by Section 23(5)(e) of the Act either; because it would simply add to the number of licensed premises; or because it would increase the number of premises of the relevant description, depending on the approach which the Licensing Board has taken in the policy statement.”
The effect of the policy is to create a rebuttable presumption against the grant of an application where overprovision has been identified. However an application still requires to be determined on its own merits and it is understood that there may be exceptional cases in which an applicant is able to demonstrate that the grant of the application would not undermine the licensing objectives, or those objectives would not be undermined if the applicant’s operating plan were to be modified or the grant of the license made subject to appropriate conditions. Both section 142(4) and the guidance recognise that Licensing Boards may depart from the guidance if they have reason to do so, provided the Board has regard to the guidance in reaching a particular decision or view. The guidance also stresses at paragraph 57:
“Because the application of the policy must leave room for exemptions, the policy should not set a numerical quota of licensed premises, or premises of a particular description for any locality.”
[27] In terms of the previous licensing regime under the Licensing (Scotland) Act 1976, section 17(1)(d) of that Act provided that the Board must refuse an application for a new license if it is satisfied the grant of the application will result in the overprovision of licensed premises in the locality. The provisions on overprovision introduced by the 2005 Act require Licensing Boards to take a proactive position on overprovision and identify those localities in which it would not propose to grant new licences, or licenses for premises of a particular description. This allows Licensing Boards to take account of the “particular description” of the premises (that is to say, their styles of operation) when assessing their operation and directs Licensing Boards to have regard to the number and capacity of licensed premises and localities. As paragraph 34 of the guidance narrates, this approach:
“provides potential entrants to the market with a clear signal that they may incur abortive costs if they intend to apply for a license in a locality which the licensing board has declared to have reached overprovision;
improves public and licensed trade confidence in a system by setting out
clearly the grounds on which overprovision should be determined;
recognises that halting the growth of licensed premises in localities is not
intended to restrict trade but may be required to preserve public order, protect the amenity of local communities, and mitigate the adverse health effects of increased alcohol consumption resulting from growing outlet density.”
[28] The guidance recommends that in promulgating its overprovision assessments the Licensing Board should closely scrutinise the provision of licensed premises across the whole of its area and then proceed to determine any particular localities although it is not necessary to divide the whole of the Board’s area into separate localities. Paragraph 51 of the guidance provides:
“the Board should therefore consider carefully whether it wishes to state that overprovision exists in the locality simply having regard to the number of licensed premises and their capacities. Such an approach should only be adopted in exceptional circumstances. Proper regard should be given to the contrasting styles of different licensed operations and the different impact they are likely to have in the promotion of licensing objectives. A policy which discourages premises where the primary activity of consumption of alcohol may leave room for the introduction of licensed premises which are likely to produce positive benefits for the locality or which will have a neutral impact on those objectives.”
This suggests that the anticipated approach is for a Board to approach overprovision in terms of the type of premises.
[29] It was accepted that the defender’s policy was not challenged as to process leading to it, or substance of it, or the rationale for it. Indeed the 2013 – 2016 policy is to a great extent a development of the 2010 – 2013 policy. The foreword to the policy makes reference to the report considered by the defender in May 2013 “Overprovision – What does the evidence say?” which provided statistical information. Paragraph 25 of the 2013-2016 policy set out the following types of licensed premised to be overprovided – public houses: nightclubs; off-sales and local convenience stores and supermarkets. Off-sales and local convenience stores had previously been identified as subject to overprovision. The 2013 – 2016 policy added some localities and, in addition, contained a refinement in paragraph 28:
“…The Board recognises the positive health benefits associated with increased employment opportunities as a factor that applicants may use in support of their application and a factor that may in appropriate circumstances rebut such a presumption…”
The IDZ 2 at Dalmuir had been identified as overprovided in the 2010 – 2013 policy and was again found to be subject to overprovision in the 2013-2016 policy. The approach of the defender was thus well-established and should have been well understood, certainly to a national operator such as the pursuer. The report “Overprovision – What does the evidence say?” in table 15 records nine off-licenses in Dalmuir.
[30] The pursuer’s counsel submitted it was unclear from the statement of reasons which leg of Section 23(5)(e) the Board were proceeding under and which test they were applying. That is also seen in table 15 where having recorded numbers of on- and off-sales premises separately, the relation between licensed premises per 100,000 of population is shown in relation to all licensed premises. The difficulty with the pursuer’s argument is that under either leg it appears that there is no dispute that the view of the defender was that there was overprovision. Overprovision was certainly identified in respect of licensed premises of the particular type in respect of which the application is made. (2013-2016 policy para 25) At best for the pursuer it might be said there was some lack of clarity as to the precise extent of overprovision. Having regard to the policy and given the structure of the statutory provisions applicants require to inform themselves of a Licensing Board’s approach as set out in that policy. The position on overprovision should have been apparent to a properly informed applicant. While the statement of reasons could have been more specific in stating that overprovision was being considered in the context of premises type, given this was a premises application for an off-sales in a local convenience store and the terms of paragraph 25 of the policy I consider it to be tolerably clear that the decision was being taken on the basis of over provision of such premises. That view also reflects paragraph 51 of the guidance that Boards should only in exceptional circumstances look at the number of licensed premises and their capacities and therefore by implication look at overprovision on the basis of premises type.
[31] I also consider that there is force in the submissions made by the defender’s counsel that no challenge was made by the pursuer in submitting the application or in presenting argument before the defender that they had an issue or sought to challenge the applicability of the overprovision policy as it applied to their application. Rather, as is suggested by the terms of the statement of reasons the pursuer recognised there was overprovision and the pursuer sought to explain why an exception should be given to their application. Further, it was not was suggested in the application nor indeed in argument before the court that the pursuer sought an exception be made for one case rather than the other. In Malloch v Aberdeen Corporation 1971 SC (HL) 85 Lord Wilberforce states at page 181:
“A breach of procedure, whether called a failure of natural justice or an essential administrative fault, cannot give him a remedy in the Courts unless behind it there is something of substance which has been lost by the failure.”
[32] I agree with and endorse the analysis of Sheriff Principal J Taylor in Kell (Scotland) Ltd v City of Glasgow Licensing Board (supra). The onus lay with the pursuer to satisfy the defender that there were circumstances here whereby they should exercise their discretion to grant the licence application notwithstanding the existing overprovision. Indeed, as indicated above, it would appear in the pursuer’s submissions to the defender at the hearing they were trying to satisfy the defender on these matters. I do not accept the submission made by the pursuer that the defender may be validly criticised for not having given an indication in the course of the hearing that overprovision was a concern to them. I am therefore satisfied that the defender was entitled to find that the pursuer had not rebutted the presumption that an application would be refused where overprovision had been identified.
Protecting and improving public health
[33] I recognise there to be some force in the submission by the pursuer’s counsel that the defender may be challenged in saying that it may be demonstrated that a grant of the pursuer’s application would be inconsistent with the “objective of protecting and improving public health.” The pursuer’s counsel noted the difficulty of linking directly the “objective of protecting and improving public health” to the pursuer’s application. This was recognised in the Scottish Government consultation paper “Further Options for Alcohol Licensing Consultation document 2012” at page 37. Paragraph 97 states:
“…it is difficult to make a case and almost impossible to relate public health data to individual premises.”
This difficulty has, according to the pursuer’s counsel, led to the passing of Section 55 of the Air Weapons and Licensing (Scotland) Act 2015 which allows Licensing Boards to have a whole area of overprovision policy, but that provision was not in force at the time of consideration of the application and only came into force on 30 September 2016. I have considerable sympathy with the pursuer’s counsel’s assertion that there was no evidence before the defender which entitled them to conclude that the granting of this application would prejudice the “objective of protecting and improving public health.” The defender’s counsel’s submission was to seek to justify this in the context of overprovision and to suggest it was subsidiary to overprovision, on which I find the defender to be on much stronger ground. While I accept that the health statistics in West Dunbartonshire are extremely poor, as seen in the report “Overprovision – What does the evidence say?” I am not satisfied that the defender had a proper evidential basis for stating:
“and the fact that the grant of the application will result in the increased sale of alcohol, availability and consumption, and the relationship from studies between the availability of alcohol and alcohol related health harms, that the grant of the application would be inconsistent with the licensing objective of ‘protecting and improving public health.’”
I am not persuaded that the results of “studies” may be said to sufficiently link this application and its effect with the general objective of “protecting and improving public health.” In these circumstances I do not consider that the defender was entitled to rely on contravention of section 23(5)(c) as a stand-alone reason for refusal of the pursuer’s application.
Irrationality when the Co-op application granted
[34] In relation to the refusal of the application and the alleged irrationality of granting the application for the Co-op, prima facie it appears that the defenders were acting irrationally and in a manner contrary to natural justice in refusing the pursuer’s application and granting another very similar application. However, on scrutiny, I am satisfied that this is not the case. It is clear that the policy must not be universally applied, for that would be to withdraw the very discretion which is at the heart of such decision-making. The Co-op application made express reference to the jobs which would be created if their application were granted and the consequent health benefit to those who would be employed, with a view to rebutting the presumption that overprovision would result in their application being refused. The pursuer only submitted their application if granted would “secure existing jobs”, as recorded in the statement of reasons, and it was not suggested to me this was incorrectly narrated. This may be a fine distinction it is nonetheless a distinction between the two applications. I am therefore satisfied that there was information before the defender which might have entitled them to distinguish between the two applications. In particular that there was a basis (identified in the policy) and sufficient information to allow them to rebut the policy presumption and grant the application by the Co-op. Absent such a specific and focused representation being made by the pursuer I conclude the defender could take a different view on each of the applications.
[35] I must however also be satisfied that it is a distinction which the defender was entitled to take account of in the proper exercise of their discretion. As narrated above the 2013 -2016 policy introduced a basis for the defender to look at the two applications differently. The question is whether this distinction is valid when looked at in the context of the decision which the defender was required to take. The refinement introduced in paragraph 28 of the 2013 – 2016 policy provides:
“The Board recognises the positive health benefits associated with increased employment opportunities as a factor applicants may use in support of their application and a factor that may in appropriate circumstances rebut such a presumption.”
The pursuer’s counsel criticised this refinement of the policy to allow for consideration to be given to the health benefit to employees, through employment, where this arose from the grant of a licence. The critical question on which this ground of appeal therefore turns is whether the provisions within the Board’s policy, that an exception to overprovision arrangements could be allowed where employment was to be created, was a relevant consideration. This having regard to the five licensing objectives set out in the Act, namely: (i) preventing crime and disorder; (ii) securing public safety; (iii) preventing public nuisance; (iv) protecting and improving public health; and (v) protecting children from harm. At best, the exception may be said to have some impact on protecting and improving public health. I have, however, reached the conclusion, that where the policy has a statutory derivation, follows on a required consultation process and the policy is published and available, this court in the context of a summary application should be reticent about questioning the policy underlying the exemption. The potential health benefits to the employees for whom jobs were to be created does, albeit tangentially, in the sense of relating to those involved in the sale of alcohol as opposed to its consumption, accord with the licensing object of protecting and improving public health. I therefore accept the defender was entitled to have regard to the provision in the policy permitting account to be taken of the health benefits to prospective employees, in rebutting the presumption. This accords with the view of the court in Tesco Stores Ltd v Secretary of State for the Environment [1995] 1 WLR 759 that the court should analyse whether material considerations have been taken account of, but that it is not for the court to evaluate the weight placed on such considerations. It must also be remembered that this aspect of the appeal rests on the assertion that if a licence could be granted for the Co-op premises then it was unfair, unreasonable and irrational for the pursuer’s application to be refused, and accordingly both applications should have been granted, even although in both cases the policy identified overprovision of convenience stores in the locality. Both applications required to rebut the presumption against the grant of a license given the assessment of overprovision. I did not find there to be any other significant basis on which the two applications could be validly distinguished. There is however nothing to suggest that had the pursuer made more specific submissions of the health benefits to employees that this would not have proved equally persuasive to the defender and may have resulted in the pursuer’s application being granted. The submissions made by the pursuer did not bring them sufficiently within the exception identified in the policy to allow health benefits to new employees to override the concerns about overprovision. The two applications may be distinguished, which answers the pursuer’s suggestion of irrationality on the part of the defender, and entitled the defender to reach a different conclusion in respect of the Co-op application.
Inadequacy of reasons
[36] I accept that where there is a statutory requirement for a policy on overprovision and a policy has been developed which is publicly available and accessible it is not essential for the exact numbers to be specified in the statement of reasons. Reference to the policy is sufficient for the informed reader to understand the reason for refusal. There was no point made by the pursuer to the effect that they were unaware that the grant of their licence would result in further overprovision or that they disputed this to be the case. The defender did not find them to have made representations such as to rebut the presumption that a licence application would be refused where there was overprovision.
[37] Inconsistency with the policy is sufficient to found a refusal on any of the grounds in Section 23(5) for a new license. Calderwood v Renfrewshire Council also makes clear that the reasons for refusal can be expressed in oblique terms. The classic expression of the test of the adequacy of reason given by a body exercising a statutory discretion was set out by Lord Emslie in Wordie Property Ltd v Secretary of State for Scotland. Page 348:
“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 reason for his decision which deals with the substantial questions and issue in an intelligible way. The decision must, in short, leave the informed reader and the court in no real and substantive doubt as to what the reasons for it were and what were the material considerations which were taken into account when reaching it.”
Mirza v City of Glasgow Licensing Board provides clear authority that those comments are equally applicable in a licensing context.
[38] In Loosefoot Entertainment Ltd v City of Glasgow Licensing Board Sheriff Gordon is clear that the Board’s decision is to stand or fall by the reasons they give for appellants are entitled to know what it is they are appealing against. The learned sheriff also made clear that the obligation on the Board is not to set out something comparable to a stated case.
[39] In relation to the pursuer’s argument that there was a lack of clarity and specification in the statement of reasons on whether the defender was considering the matter of overprovision generally, in terms of section 23(5)(i) or particularly, in relation to the nature of the premises under section 23(5)(ii), I am satisfied that there was sufficient specification in the reasons given by the Board and that they were indeed referring to off-sales premises being of a similar type to the application. Reading the whole of the statement of reasons it is tolerably clear to an informed reader that defender was focusing on overprovision in respect of off-licences or convenience stores. That also reflects para 51 of the guidance, which proposes that the normal approach to be taken is to correlate overprovision in relation to premises type.
[40] I also accept that the Board provided sufficient information to make clear that they were referring to overprovision of off-sales or convenience stores in Dalmuir and that there was adequate information for the appellants to understand the reasons for which their application had been refused on the basis of the published policies. I do not accept that the appellants were entitled to the greater specification for which they argued. I consider the statement of reasons provided sufficient information to comply with the approach required, as set out in Wordie Property Ltd v The Secretary of State for Scotland.
[41] I consider that facts here are indeed similar to Calderwood. The statement of reasons made reference to the submissions made by the applicant and explains that the Board was not persuaded to make an exception to the policy. On the basis of the information before the defender, I accept the defender was entitled to refuse the application on the basis that it would result in further overprovision of a local convenience store off-licence within the Dalmuir area and the statement of reasons provided sufficient explanation for the decision on that ground.
[42] The unsurmountable difficulty for the appellant is that in they are unable to identify a basis on which the defenders should rebut the presumption for refusal of an application where there is overprovision. Section 23(4)(b) provides an application will be refused where any one of the grounds for refusal in section 23(5) apply. Therefore even discounting the defender’s reliance, as expressed in the statement of reasons on the application being inconsistent with the objective of promoting or improving public health under s. 23(5) (c), the appeal falls to be refused unless I were to be satisfied that that there was a material failure by the defender in exercising its discretion to refuse their application on grounds of section 23(5)(e). I am not so satisfied. I accept the defender was entitled to refuse the application where their policy had identified overprovision of off-sales or convenience stores in Dalmuir and the pursuer had not satisfied them there was a basis to rebut the presumption. Accordingly, the appeal falls to be refused.