Trust Inns v City of Glasgow Licensing Board 2014

A CONSIDERATION OF THE DECISION IN TRUST INNS LIMITED v GLASGOW LICENSING BOARD, GLASGOW SHERIFF COURT, 22 JANUARY 2014

The full decision of the above judgement can be read here.

This case concerns a Glasgow public house known as the Scotch. In June 2013, Police Scotland called for a review of the licence held by Trust Inns Limited and at the hearing, the Glasgow Licensing Board decided to revoke the licence. You can read press coverage of the initial revokation here and here.

The case brings out a number of interesting points for licensing practitioners and can be said to have added to the evolving case law surrounding reviews; as well as touching on some technical issues bound to raise an eyebrow or two.

The revokation resulted from police allegations that the premises had become associated with drug dealing and they referred to a list of 8 or 9 incidents where they believed there was evidence of drug taking which had occurred in the premises.

The licence holder endeavoured to defend their position by taking a series of steps to mitigate the issues, and in addition as a landlord licence holder they had also replaced the tenant. The sheriff was referred to the decision in LIDL v Glasgow Licensing Board concerning the “forward looking” aspect of a licence review hearing, in order to make sure the licensing objectives would be protected going forward.

The sheriff was unimpressed with the appellant’s view that the licensing board did place significant weight on various remedial actions which the licence holder had taken, which including introducing a “drug wipe” policy and removing the tenant.

The Sheriff dismissed the suggestion that the Board was wrong to revoke the licence because these steps had been taken. A key part of the judgement from Sheriff Reid is as follows:

“…the [licensing board] had made an assessment of the nature of the perceived
drug problem within the premises; it had made an assessment of the value and
efficacy of the pursuer’s remedial actions; and it also considered whether (and
when) the situation was likely to improve. The defender concluded that the
situation was not likely significantly to improve within a reasonable time. Its reasoning can be discerned from the statement. The culture of drug misuse  was so embedded, and the steps taken to date had been so ineffective, that the belated recent introduction of a new tenant, drug wipes and torches would not resolve matters “in the near future”. In other words, the defender was having to contemplate the unattractive prospect of allowing the premises to continue to operate in a manner that envisaged ongoing drug misuse while the pursuer’s efforts (which had singularly failed to eliminate the pattern and culture of drug misuse) hopefully worked through. In that context, the defender was indeed having proper regard to how the licensing objectives would be achieved in the future“.

Sheriff Reid distinguishes this case from LIDL case because that related to an incident (a failed test purchase) for which there was no previous history or repetition in which there was a significant level of “due diligence” and prompt action. In the present case, by comparison, the Sheriff takes the view that there had been a long history of issues which had not been properly addressed of resolved and one is very much left with the impression that the Sheriff agrees with the Board that the actions taken by the licence holder (including removal of the tenant) could be categorised as “too little, too late”.

In this case the Sheriff appears to have little interest in the plea that the Board had erred in not giving greater weight to the argument that issues at the premises had dissipated since the ejection of the previous tenant:

“…[Trust Inns] submitted that the [licensing board] failed to take due account of
the fact that there had been no further recorded incidents of drug misuse since
the change of tenancy. It is correct that the statement of reasons makes no
explicit reference to this issue. That is not surprising. It did not feature
significantly in the submissions at the review hearing. Nevertheless, the 
[licensing board] was entitled to proceed on the basis of the substantial material then
available to it. There was no undue passage of time between the allegations
contained within the review application and the consideration of those
allegations at the review hearing such as to render the allegations historic or
stale. Besides, the [licensing board] had before it a sufficiently recent, detailed and
extensive body of evidence bearing upon the operation of the premises, drawn
over a sufficiently lengthy period of time, to enable it to reach an informed
decision on the extent to which a “pattern and culture of drug misuse” had
become embedded within the premises, and the likely effect upon that culture of
the recent introduction of the new tenant

It is not clear what evidence was led concerning the stability of the premises since the introduction of the new tenant. It is also unclear if the Board took into account how a revocation may affect the new tenant who could be a completely innocent party in all of this: but of course that would not be a problem if one holds the view that fault is an irrelevancy.

The Sheriff goes on to say: “the defender’s decision in the present case to revoke the premises licence did not constitute a punishment, but rather a necessary and appropriate step to further the licensing objectives“.

You could question whether such a result might also have been achieved from a suspension of the licence for a period of time. A period of suspension might have also allowed the licence holder to take further, more dramatic steps, and allowed a period of calm where those associating themselves with the premises which had brought it into disrepute would have to move on. That would in turn allow a tenant to make a fresh start of running the premises correctly.

It is worth noting that in this case the level of imperillment of the licensing objectives is far and away a different set of facts and circumstances compared to LIDL. And I would suggest that there must be a “spectrum” along which a licensing board must weigh up the remedial actions of the licence holder. What appears to be important from this decision is the swiftness of those actions, and what effect they have had.

It is also worth noting that the hearing took place, in the Sheriff’s view, relatively closely to the occurence of the incidents. In other words, there had been no undue “passage of time” to make the allegations “historic or stale”. The implication of that is, in my view, that if there has been a passage of time between incidents and hearing, and the premises has operated otherwise difficulty, then a licensing board should be slower to take a step such as suspension or revocation.

However, the Sheriff also considers the issue of “fault”:  “even if it could have been argued that the pursuer had timeously taken all practicable steps available to it (which, clearly, the defender concluded was not the case here) it would have been open to the defender to
conclude, on the material available to it, that, through no fault of the pursuer, the premises had become blighted by criminal or nuisance behaviour, thereby jeopardising compliance with the licensing objectives, and justifying revocation of the licence… That is because the licensing objectives are not fault-based. They seek to protect and promote a wider range of public interests, quite distinct from issues of fault, blame or culpability.”

This is a very interesting part of the judgement. It is not clear from this passage how the reference to a “wider range of public interests” sits with the Brightcrew related jurisprudence concerning whether the licensing objectives are about protecting and promoting “wider public interests”. It moves the debate away from the fact that the objectives are licensing objectives (and not public interest objectives) to a separate question about whether the responsibility or otherwise of a licence holder can become an irrelevancy in having their licence revoked. This logic suggests, therefore, that even if the licence holder has acted impeccably, that the licence could still be revoked. I can see how the trade may be concerned to note that in taking as many steps as they possibly could to remedy an issue this may still result in a revocation: an outcome which could also result if they had simply not taken any steps at all.

It may take some further appeals for this to evolve more fully and for now it remains, at a first reading, a very interesting development which will be welcomed more openly, I would imagine, by police and licensing boards than the trade.

It is of course open to Trust Inns Limited to appeal this decision to the Court of Session, just as LIDL did following their unsuccesful appeal to the Sheriff in the first instance.

LSO REPORTS AND THE QUESTION OF FAIR NOTICE
A final word to licensing solicitors in private practice: the Sheriff appears to takes the view that failure to notify the licence holder of the presence of an LSO report in connection with a review is not a breach of natural justice if the licence holder has an experienced licensing solicitor. There is no mechanism under the Act for the LSO report to be notified to the licence holder but procedural fairness would suggest that this must be done and in most cases is sent by the Board to the agent with the review papers, or shortly thereafter.

Perhaps the Sheriff may have taken a different view if the licence holder had not been represented legally. It does seem to me to be rather unfair. This position ignores the reality that many licence reviews are placed in the hands of an agent with only 7 days notice and sometimes less. We have no idea if there is an LSO report produced: but the harsh lesson here is that we private practice licensing solicitors must request production of the LSO report as soon as we are aware of a review; and cannot complain if it is exists but we have not seen it!

It seems to me that this has betrayed an anomaly in the Act. Surely an experienced solicitor has just as much right as a lay person to fair notice of material without having to formally request it? Should section 38 not import a duty on the Board to serve a copy of any report or material produced in relation to the licence review which it may take into account at the hearing on the licence holder, just as under s.22 the Board is required to serve copy objections on a licence applicant? I wonder if it is too late to ask for this to be picked up in the forthcoming Licensing (Scotland) Bill 2014!

 

 

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About Stephen McGowan

Leading Scottish licensing solicitor at TLT. Chairman of BII Scotland.
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