Appeals flowing from the Licensing (Scotland) act 2005 are relatively rare. The last reported appeal was Keasim Ltd v City of Glasgow Licensing Board [2021] SC GLW 57, an important case which relates to occasional licences but more generally to the vires of a board. So it has been a good couple of years for the legions of Scottish licensing law anoraks waiting on another judgement to dissect. I am therefore delighted to bring you some analysis of a new decision, namely Certas Energy UK Ltd v South Lanarkshire Licensing Board [2023] SC GLA 29. Happily, there is a crucial link between these two cases, viz Sheriff Reid. It is always a relief to see a decision from Sheriff Reid, who it seems to me benefits from a real grasp of the licensing system as well as, of course, the jurisprudence and the law.
This decision relates to a petrol forecourt shop in Cambuslang. A previous application for a licence had been refused; and on appeal was remitted back to the board. The board heard the case, and proceeded to refuse it again. That second refusal was also appealed, and this decision is the result.
As a brief aside, this is the first case I am aware of where a licence application has been refused again following a remit.
The application was refused (again) on the basis of overprovision and the appeal flows for most part in a challenge to the lawfulness of the board’s overprovision policy and how the policy was conducted and created. To that end, it is somewhat timely for those licensing boards yet to come out of the traps in producing a consultation for their updated overprovision policies which are due to kick in from November 2023. To some extent, the Certas decision reminds us of lessons ventilated in the two unreported Aldi appeal cases against Dundee (12 August 2016, but still available via SLLP here; and then 30 March 2022 (no online copy available) about how boards conduct their consultations, and materials they take into account, but it especially reminds me another case I was involved with, Marini v South Lanarkshire Licensing Board (2019, joint remit agreed, unreported), where again there was a refusal on overprovision which led to a remit, though in that case the licence was granted at the remitted hearing. Those interested in other jurisprudence around formulation of overprovision policies should also be aware of Martin McColl Ltd v Aberdeen City Licensing Board, 26 August 2015 (also unreported, alas, but digested at [2016] LLR 725).
Firstly, it is perhaps useful to note that the decision explores, albeit surprisingly, whether it is competent to seek to attack a board’s policy on a summary appeal relating to an application, as opposed to a judicial review of the policy itself. Most commentators would, I believe, have suggested that matter was settled by Brightcrew Ltd v City of Glasgow Licensing Board 2012 SC 67, which confirmed a decision to refuse based on policy is susceptible to appeal where it is averred the policy is unlawful. Sheriff Reid makes matters very clear for us in this regard and eruditely confirms that a summary appeal may challenge a licensing policy.
The case then exposes a number of flaws in the creation of the overprovision policy which ultimately led to the application being refused. The first of these errors relates to locality.
In consulting on the policy, the board failed to properly identify the locality or localities it was seeking evidence for; and failed to properly consult with persons resident in the locality. In this case, the board had issued a pre-consultation exercise to help inform them; but that exercise/survey did not identify the localities. Further, the survey was only conducted with employees of South Lanarkshire Council and therefore was not conducted towards the relevant statutory consultee of persons resident within the locality, notwithstanding the boards somewhat opaque efforts to link those employees to the localities using post codes.
An interesting aspect of the case is the interplay with the Scottish Government statutory guidance (aka the s.142 Guidance). Here the challenge was that the board did not have regard to the Guidance in the formulation of the policy; again Sheriff Reid upholds that argument (at Para 44):
“the defender’s consultation failed to have regard to the statutory Guidance, in breach of section 142 of the 2005 Act. That failure constitutes an error of law; that error is material in nature (because it relates to a core element of the consultation procedure, namely the proper evaluation of consultation evidence); that material error vitiates the defender’s published Policy (so far as relating to alleged overprovision inter alia in Cambuslang East); and, insofar as the defender’s refusal of the pursuer’s application was founded upon that flawed aspect of the Policy, that decision is likewise vitiated by error of law.”
The Statutory Guidance relevant to this case was the first edition, which dated back to March 2007, and was therefore always a focus of criticism from the licensing community due to it’s vintage, but that criticism would not admonish the statutory requirement to have regard to it. We do now have a long-awaited second edition of the guidance, which was published on 13 January 2023, and is available here.
Sheriff Reid offers us yet more insight, this time in relation to the relevance of materials relied on by the licensing board produced by Alcohol Focus Scotland and the reference to what is known in licensing circles as the CRESH report (at Para 45):
“The AFS Report is entirely generic in content. It does not address overprovision within any locality. The authors of the AFS Report acknowledge this limitation on their evidence.”
Sheriff Reid goes on to say (at Para 46):
“The upshot is that the terms of these Reports, however impressive at a generic level, cannot be regarded as “robust and reliable evidence” indicative of a saturation point having been reached, or close to being reached, in any locality. Nor can a “dependable causal link” be “forged” between that generic evidence and “the operation of licensed premises in a locality”“
The issue of the disconnect between specific premises and specific localities, in comparison to data which might be put forward by health stakeholders is also addressed by Sheriff Reid, saying (at Para 47):
“…the defender relied upon statistical data in the Briefing Report as supporting a link between alcohol availability and rates of death and hospital admission. However, again, the Briefing Report is not locality-specific. It addresses “data zones”, not localities. Curiously, the locality of Cambuslang East does not even feature in the Briefing Report as a “neighbourhood” or a “data zone” of concern.”
This, for me, is a crucial observation for those of us at the coal face of licensing hearings. The reference to intermediate data zones (IDZs) as the focus of health evidence should be challenged where those zones do not align with the agreed locality. Many licensing boards will consider a locality based on a radial projection; for example, looking at a “locality” which is 500m within of the application premises. Such locality is not going to mirror an IDZ, which will be a totally different area, albeit they two may overlap.
Another element of the judgement worth reflecting on is the board’s reliance on “local knowledge”. It is well understood that a board relying on its own local knowledge in reaching a decision is an important part of the licensing process. But the local knowledge must be declared otherwise reliance on it would be unlawful. Sheriff Reid has this to say (at Para 60):
“The use of local knowledge to determine “localities” (or to draw inferences from locality-specific material already available to it) is the sort of local knowledge which has secured judicial approval (Mirza v City of Glasgow Licensing Board 1996 SC 450), albeit such local knowledge ought still to be disclosed at common law (Pagliocca v City of Glasgow District Licensing Board 1995 SLT 180). Where a board has private information which is not otherwise available to parties or the public, the rules of natural justice require its disclosure (Freeland v City of Glasgow District Licensing Board 1980 SLT 101). Here, the “local knowledge” that is founded upon relates not merely to the determination of the localities (or to the drawing of inferences from available locality-specific evidence) but to other material issues, namely, to establishing a supposed connection between particular localities and generic data on alcohol availability, injury to health, criminality, and/or anti-social behaviour. But what is this magical “local knowledge”? The Policy is silent. It is not disclosed.”
The undeclared “local knowledge” was one of the grounds of appeal under the Marini case mentioned above. Consider also the following statement from Tesco Stores Ltd v City of Glasgow Licensing Board 2013 SLT (Sh Ct) 75: “if a board has relied upon any specific, material information, it must not rely upon undisclosed material but must give the applicant an opportunity to make submissions upon that material.”
The last element of interest to me in this case is one of the unsuccessful grounds of challenge. Certas had argued that the board had acted irrationally because they had granted another licence in the same overprovision locality at the same hearing. Sheriff Reid dismisses this ground, but in doing so gives us all a very helpful analysis (at Para 64):
“The two applications were quite separate. Two wrongs would not make a
right. The defender was entitled, indeed obliged, to consider both applications independently on their own merits. Even if the defender went wildly wrong in having granted the “Super Save” application, or in its articulation of the reasons for doing so, the defender was entitled (and obliged) to consider the pursuer’s application on its own merits and to reach and articulate a correct decision on that separate application. True, there ought to be consistency in administrative decision-making on comparable matters. Arbitrary and capricious decisions are to be deprecated. But the circumstances in which an aggrieved applicant should be entitled to open up and scrutinise the merits of separate decisions, involving different parties, premises and applications, must be limited. On practical grounds, it is also unattractive because it necessarily embroils the court in scrutinising a multiplicity of decisions. In extreme cases, a blatant or recurring inconsistency in administrative decision-making across different applications, readily verifiable as otherwise related in circumstance, may well go to support a challenge based on irrationality. But those circumstances are likely to be exceptional. Ultimately, here, all that the defender can say is that the Super Save application should not have been granted and that the defender made an error in doing so. So what?“
Overall, I think it fair to describe this case as a very helpful addition to the canon of licensing jurisprudence. In his usual fashion, Sheriff Reid has delivered us a thorough analysis of a number of licensing law issues and there is plenty to digest here.
McGowan on Licensing: Blawg 