Matchurban v. City of Glasgow Council & Anor [2003] ScotSC 24 (31 January 2003)

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The Sheriff, having resumed consideration of the cause, Repels the pursuers' first, second and fourth pleas-in-law, Repels the first defenders' pleas-in-law, Repels the second defender's pleas-in-law, and Sustains the pursuers' third plea-in-law under deletion of the words "as craved with expenses" and Reverses the decision made by the first defenders at their meeting held on 5^th June 2002 to grant the application by the second defender for the grant of a new public entertainment licence for premises at 100 Union Street, Glasgow; quoad ultra Remits the application to the committee to reconsider their decision; Appoints parties to be heard on all questions of expenses and Assigns 28 February 2003 at 9.30 a.m. within Glasgow Sheriff Courthouse as the diet therefor.

[1] This Summary Application, presented under the Civic Government (Scotland) Act 1982 ("the Act"), appeals against a decision made on 5 June 2002 by a sub committee ("the committee") of the first defenders which dealt with licensing applications whereby the committee granted in favour of the second defender his application for the grant of a new public entertainment licence ("the licence") for premises at 100 Union Street, Glasgow ("the premises"). The pursuers crave the Court to reverse that decision, and furthermore to ordain the defenders (sic) to refuse the licence.

[2] The Application called for a hearing on 18 November 2002. At the hearing the pursuers were represented by Mr Henderson, QC, the first defenders by Mr Romano, solicitor, and the second defender by Mr Skinner, advocate.

[3] The Application called along with another Summary Application, at the instance of UBS Global Asset Management Client Services Limited ("UBS"). That Application was directed against the same defenders in respect of the same decision and sought the same remedies on the same pleadings except for the designation of the pursuers. At the hearing UBS was represented by Mr Henderson, and the defenders by Mr Romano and Mr Skinner respectively. Although the Applications were not formally conjoined, parties confined their submissions to the case at the instance of the present pursuers and applied them mutatis mutandis to the UBS case. I propose to do likewise.

[4] At the outset of the hearing Mr Henderson, Mr Romano and Mr Skinner concurred in stating that the parties had reached agreement that the grant of the licence should be revoked, and that the only issue left for judicial determination was whether, under and in terms of paragraph 18(9) of Schedule 1 to the Act, I should remit the Application to the committee with the reasons for my decision for reconsideration of their decision, or whether I should reverse the decision of the committee without a remit.

[5] The hearing thereafter proceeded on the basis of oral submissions. No party to the appeal wished to lead evidence. From the terms of the parties' pleadings taken in conjunction with their submissions it was possible to find unanimity on the following facts.

[6] The second defender submitted his application for a public entertainment licence to the first defenders as the licensing authority for the City of Glasgow within whose area the premises are situated. He wished to open and operate the premises as a place of public entertainment in the form of an amusement arcade. In furtherance of that desire he also submitted an application under the Gaming Act 1968 for permission to install in the premises machines for amusement with prizes. As originally framed that gaming machine application sought a licence for one hundred and twenty machines but the second defender reduced that to seventy five. The committee accepted both applications and placed them on the agenda for their meeting of 5^th June 2002.

[7] Both the pursuers and UBS lodged an objection to both applications. The committee accepted both objections.

[8] At the meeting of the committee held on 5 June 2002, the pursuers were represented by Mr Henderson and the second defender by Mr Gordon, solicitor. The meeting had to deal with many other applications. One of those was at the instance of the pursuers in respect of a public entertainment licence for premises at 50/60 Union Street, Glasgow. Those premises had formerly been used as an amusement centre. They were situated very close to the premises.

[9] The pursuers' application in respect of 50/60 Union Street was heard and considered immediately before the second defender's applications in respect of the premises. In support of the pursuers' application Mr Henderson stated to the committee that the pursuers accepted their application was contrary to the first defenders' policy with regard to over-provision of amusement facilities within premises in Glasgow city centre. In order to avoid breaching that policy, they were prepared, as a condition of the grant of their application, to surrender their existing public entertainment licence for premises at 14/16 Renfield Street, Glasgow which was then operating as an amusement centre. This submission found favour with the committee and they granted the pursuers' application.

[10] Immediately thereafter the second defender's applications called before the Committee. Mr Gordon presented his submission on a similar basis to that adopted by Mr Henderson, namely, that the second defender accepted that his application for a public entertainment licence was contrary to the first defender's policy on over-provision. In order to avoid breaching that policy, the second defender was prepared, as a condition of the grant of his application, to give an undertaking that he would surrender his existing public entertainment licence for premises at Unit 8, 262 Argyle Street, Glasgow ("Unit 8").

[11] Mr Henderson supported the objections to the application made by both the pursuers and UBS on two grounds. The first was that to grant the application would result in over-provision. The second was that the application was contrary to the stated policy of the first defenders with regard to amusement centres in the city centre of Glasgow. With regard to the second defender's offer, he submitted what is set out in articles 6 i) to iv) of condescendence. Mr Gordon was given an opportunity to reply to those criticisms and he did so. He submitted that the case for the second defender was predicated upon the application being contrary to the first defender's policy and that to avoid that he undertook to surrender his existing licence

[12] Having heard parties the committee retired to consider their decision. When they returned they announced that they had decided to grant the application on condition that the second defender surrendered his licence for Unit 8. They furthermore said that they would intimate their decision within seven days.

[13] Subsequently the first defenders issued their Statement of Reasons for their decision in a letter dated 9 July 2002. A copy of that letter is lodged in process as No. 4/1 of process.

[14] At all times material to his application the second defender had no existing public entertainment licence for Unit 8.

[15] The first defenders had at the material time a policy in relation to the provision of amusement facilities in the city centre of Glasgow. That policy was to the following effect: - "that where there are one or more [public entertainment] licences within a 500 metres radius of the applicant site or two or more licenses in place within a 1,000 metres radius of the application site, the licensing authority will generally consider that this is sufficient to meet demand within that locality."

[16] Mr Henderson began by rehearsing the principal facts of the appeal. He then looked in some detail at the Statement of Reasons. He quoted that part of the Statement commencing at page three, section 4, down to the end of page four. In particular, he drew attention to the following passage starting at page three: -

[17] Mr Henderson said that the second defender having conceded that at the material time he had no such existing licence for Unit 8, the committee, in dealing with the application, had proceeded upon an error of law. He further submitted that the second defender's offer to surrender the Public entertainment licence for Unit 8 was central to his application.

[18] Mr Henderson turned to consider the relevant terms of the Act. In particular, he referred to paragraph 18 of Schedule 1 to the Act which sets out the right of appeal from the licensing authority to the sheriff. He described this provision as echoing the licensing provisions for liquor licences set out in the Licensing (Scotland) Act 1976. He submitted that cases involving appeals under the liquor licensing provisions could be used to assist in an appeal such as the present because the statutory regimes were similar. He drew attention to the powers of the Sheriff set out in paragraph 18(7) which relate to the circumstances in which he can uphold an appeal, and in paragraph 18(9) which states what a sheriff can do if he upholds an appeal. Mr Henderson submitted that whether to remit or reverse or modify was made a matter of shrieval discretion.

[19] Mr Henderson then turned to review the considerable body of case law, most of it from liquor licensing cases. Some of the decisions he described as conflicting but he said he wished to extract some general principles from them. He submitted that the authorities showed there were four groups of cases. The first group was those which he described as the "natural law" cases. The proposition he took from these was that if there were a blatant and deliberate contravention of the principles of natural justice then it was inappropriate for the Court to remit to the committee. He extracted this proposition from the case of G. A. Estate Agency Limited v City of Glasgow District Council 1991 SLT 16 and in particular the passage at page 18A to B from the opinion of the Court delivered by Lord Dunpark. The second group he described as a lesser group of cases contravening natural justice involving matters such as procedural irregularities. The third group he described as the "war of attrition" cases. These were cases where an applicant and a Licensing Board had been batting applications back and forth over a period of time. In such cases it was inappropriate to remit to a Board because of the concern that the Board would not be able to deal with such a remit with the necessary degree of detachment. This proposition he derived from the case of Botterills of Blantyre v Hamilton District Licensing Board 1986 SLT 14 and founded upon the passage at page 16B to C from the opinion of the Court delivered by the Lord Justice-Clerk, Lord Wheatley. The fourth group was cases where the original decision could not be justified on the basis of material facts.

[20] Applying the general propositions to the particular circumstances Mr Henderson submitted that the subject matter of the present proceedings fell into the fourth group. This was because the second defender had laid no material facts before the committee to justify the grant of the licence if there were no valid existing licence to surrender. The second defender now accepted that he had never occupied Unit 8, had never had right, title or interest to Unit 8, and that Unit 8 had been acquired by J D Wetherspoon, a company whose business involved running public houses. That company had gutted Unit 8 as well as adjacent premises and as at the date of the committee meeting had almost completed the conversion of the whole enterprise into public house premises. Despite being informed of this, the committee reached their decision on the basis that the second defender would surrender his licence for that Unit.

[21] Mr Henderson submitted on the basis of the foregoing that in the present case there was no point in remitting the application to the committee. This was the approach taken in Leisure Inns (UK) Ltd v Perth and Kinross District Licensing Board 1993 SLT 796, and followed in Mumtaz v Glasgow Licensing Board 1997 SLT (Sh Ct) 82. In the present case the error in law was a serious one. The committee proceeded on the basis that the second defender held a valid licence for Unit 8 that he could then validly surrender on the grant of the application. The committee only made their decision to grant because the second defender had made his offer to surrender his existing licence. There was no material before the Committee to justify a grant of this licence on any basis other than the surrender of the existing licence. There was no material placed before the Committee to justify granting the application in the absence of such an offer to surrender. I should follow the approach taken in both Leisure Inns and Mumtaz and determine the matter rather than remit to the committee. I should do so notwithstanding that the present Summary Application was slightly different from nearly every case of appeal in that the present application was concerned with the grant of a licence rather than the more usual situation of refusal of such a grant.

[22] Mr Henderson concluded by submitting that I should sustain his first and third pleas-in-law, and repel his fourth plea-in-law. Subject to hearing the submissions of the defenders he reserved his position on his second plea-in-law.

[23] By agreement with Mr Romano, Mr Skinner spoke next. His motion was that I should uphold the appeal and thereafter remit the matter to the committee in terms of paragraph 18(9) of Schedule 1 to the Act.

[24] Mr Skinner submitted that it was important to consider how it was that the committee went wrong. The committee erred in law because when reaching their decision to grant they took into account a licence for Unit 8 when that licence had ceased to have effect. That licence was in effect on paper but when the applicant ceased to have the right to occupy Unit 8 that licence ceased to have any effect. That was clear from the decision in the case of Edward Barrett Ltd v City of Dundee District Licensing Board 1992 SLT 963. At the material time in relation to the application before the committee the licence for Unit 8 had ceased to exist.

[25] Turning to Schedule 1 to the Act, Mr Skinner founded upon paragraph 5 which sets out the powers of a licensing authority. He submitted that the provisions of this paragraph were destructive of the pursuers careful analysis. He referred in particular to paragraph 5(3) and pointed out that the way in which Parliament had framed that sub-paragraph meant that a licensing committee could refuse to grant only if the individual circumstances fell within any of (a) to (d) but otherwise was required to grant. Under reference to the case of Din v City of Glasgow District Licensing Board 1996 SLT 363 he submitted that there was no onus on an applicant to show that an application should be granted: instead the onus was on whoever sought to have that application refused. He submitted that the kernel of the present pursuers' submissions was that here had to be some material to justify the grant.

[26] Under reference to paragraph 18(7) he submitted that the sheriff to whom appeals were made could not uphold a decision simply because he would have decided the matter differently. The sheriff could only uphold an appeal if the committee had gone wrong in their decision-making process under paragraph 18(7). Turning to para 18(9) he accepted that that gave the sheriff a discretion but he submitted that that discretion must be exercised in accordance with the guidance given by the Court of Session. In the present case there was no issue of natural law. The sheriff could only reverse a decision of the committee if reversal were the only decision open to a reasonable licensing committee. This was because Parliament had decreed that whether or not to refuse was a decision for licensing committees and not for the court. The authorities he cited for these propositions were the two cases of Matchurban Ltd v Kyle and Carrick District Council 1995 SLT 505 and Risky Business Ltd v City of Glasgow Licensing Board 2000 SLT 923. Both of them were cases in which the licensing authority had refused to grant a licence. Mr Skinner founded strongly and in particular upon the terms of paragraph [23] of the decision in the Risky Business case (reported at page 928C). In the present case to accede to the pursuers' motion would involve concluding that no reasonable licensing board could have held other than that the grant of the application would lead to over-provision. That was an unjustified conclusion. The matter for the committee fell within para 5(c)(d) "other cause" which could include the issue of over-provision. A decision on over-provision was one for the committee with their own expertise in licensing matters and their knowledge of their own area.

[27] In conclusion he moved to amend his fourth plea-in-law by deleting from "based" in line 1 to and including "denied)" in line 3. This motion was unopposed and I granted it. Thereafter he invited me to sustain the second defender's fourth plea-in-law as thus amended, repel the second defender's first, second and third pleas-in-law and thereafter remit to the committee to reconsider the Application.

[28] Mr Romano for the first defenders adopted the submissions made on behalf of the second defender tantum et tale. He then submitted that I should repel all the pleas-in-law for the first defenders and thereafter dispose of the appeal by way of a remit to the committee.

[29] Mr Henderson in reply and under reference to paragraph 5 of Schedule I to the Act accepted that there was no onus on an applicant. In the present appeal the second defender said that the only possible decision for the committee was refusal. That was undoubtedly right because there was no other argument addressed to the committee at all with regard to over-provision. The second defender had never addressed the committee on their policy. The second defender had also said that over-provision was a live issue. That was unfounded in fact. The committee was never asked by the applicant to make any assessment of their policy provisions. He reiterated the reasons for their decision: firstly, because the second defender offered to surrender a licence for Unit 8 and secondly, that the number of premises, if that were done, would remain unaltered. He conceded that it could be said that the latter of these did concern itself with the issue of over-provision. He submitted that if one stripped out all reference to the licence for Unit 8 what one was left with according to the second defender was the issue of over-provision: but that that had already been dealt with in the Statement of Reasons issued by the committee. There were no live issues to remit to the committee. With regard to the authorities referred to by Mr Skinner he submitted that the case of Din was no help for the defenders and he also founded upon paragraph [23] of the Risky Business case.

[30] The decision appealed against is the grant of a public entertainment licence as defined by section 41 of the Act. The licence was made the subject of the condition that the holder surrendered an existing licence. In making the grant, the committee as relevant licensing authority were acting under the powers given by paragraph 5(1)(b) and 5(2)(b) of Schedule 1 to the Act. The parties to the appeal are agreed that the grant of the licence should be revoked. The twin legal grounds advanced for that revocation are the provisions of both paragraphs 18(7)(a) and 18(7)(b) of Schedule 1, namely that the licensing authority in arriving at their decision erred in law and also based their decision on an incorrect material fact. Those grounds are reflected in the terms of the pursuers' first and third pleas-in-law.

[31] The second defender accepts that at all times material to his application he did not have an existing public entertainment licence for Unit 8. Having regard to the reasoning of the committee as set out in their letter I am satisfied that the use the second defender made of that licence was a material fact in the decision making process of the committee. That fact has now been conceded to be incorrect. The use made of that fact by the committee justifies the conclusion that the committee based their decision on an incorrect material fact. Paragraph 18(7) provides that the sheriff may uphold an appeal if he considers that the licensing authority in arriving at their decision based their decision on an incorrect material fact. That appears to give the sheriff a discretion even at the stage of being satisfied that the committee had proceeded on an incorrect material fact. In the present circumstances I am satisfied that I should exercise that discretion in favour of upholding the appeal to the extent of reversing the decision of the first defenders made on 5^th June 2002 to grant the second defender's application for the grant of a public entertainment licence for the premises. I am not satisfied that in addition the committee's use of the offer justifies the conclusion that the committee acted under an error of law. I will therefore repel the pursuers' first plea-in-law. As a consequence I will also repel the fourth plea-in-law for the second defender in its terms as amended during the hearing. I have concluded that I must also repel the pursuers' second plea-in-law. Mr Henderson reserved his position on that and I have no note that he returned to it in the course of his reply. In any event I would not have been satisfied that I should sustain it on the basis of the arguments presented. I see no unreasonable exercise of discretion on the part of the committee in reaching the decision appealed against.

[32] Having thus upheld the appeal to the extent that I have, the section gives a discretion on what to do thereafter. It provides that the court may either (a) remit the case to the licensing authority or (b) reverse or modify the decision. Which course to adopt will depend upon the individual facts and circumstances of each appeal in light of relevant and binding authorities. In that latter regard I was urged by Mr Henderson to derive assistance from the cases of Leisure Inns (UK) Ltd v Perth and Kinross District Licensing Board and Mumtaz v Glasgow Licensing Board, and by Mr Skinner the cases of Matchurban Ltd v Kyle and Carrick District Council and Risky Business Ltd v City of Glasgow Licensing Board. The cases of Leisure Inns (UK) Ltd, Mumtaz and Risky Business Ltd were each appeals decided under the provisions of the Licensing (Scotland) Act 1976 ("the 1976 Act") while Matchurban Ltd was decided under the provisions of the Act. In each case the relevant licensing authority refused the application. Leisure Inns (UK) Ltd involved an application for the provisional grant of a public house licence, Mumtaz an application for the grant of a new off sales licence, and Risky Business Ltd an application for the grant of a new provisional entertainment licence. Matchurban Ltd is similar to the present case in that it involved an application for a public entertainment licence under section 41 of the Act and a permit for gaming machines under Schedule 9 to the Gaming Act 1968. Where it differs from the present case is that in Matchurban Ltd the licensing authority refused to grant the applications.

[33] Although there are certain differences between the statutory schemes set out in the 1976 Act and the Act, I am satisfied that for present purposes nothing material turns on those differences and the authorities founded upon and decided under that Act where in point can be applied to the present circumstances. Furthermore I am satisfied that although all four cases founded upon involved a licensing authority's refusal of an application at first instance nothing material turns on the nature of that disposal and the ratio of the cases where in point could apply with equal relevance to an appeal, as here, against a grant of a licence.

[34] I agree with Mr Skinner that I should follow the approach set out in Matchurban Ltd and Risky Business Ltd. That approach is both binding and in point, and I am satisfied that its application to the present appeal is unaffected by the fact that the decision on the facts was the reverse of what is before the court in the present case. At page 506I of the report in Matchurban Ltd the Court stated: -

[35] That general approach was reiterated in Risky Business Ltd at 928D where Lord Prosser, delivering the opinion of the Court, stated: -

Applying that approach, I am satisfied there are no such compelling reasons in the present case to warrant removing the responsibility for making a decision on the second defender's application of new in light of the material change in circumstances brought about by his acceptance that he had no valid licence for Unit 8 to surrender. The committee gave its reasons for its decision in the letter dated 9^th July 2002. After dealing with, and rejecting, preliminary issues of competency the committee applied itself to the requirements of paragraph 5 of Schedule 1. With regard to paragraph 5(3)(d) the committee inter alia "considered the Licensing Authority's own policy regarding premises providing facilities of the type applied for." The committee then expressed that policy in the following way: -

In the present circumstances the committee noted that within the relevant radii there was an excess of premises in receipt of a public entertainment licence but went on to note in addition the undertaking on behalf of the second defender that he would surrender his existing licence for Unit 8. From that they concluded that although the numbers of premises licensed for public entertainment was in excess of the numbers considered sufficient for the policy, the total number on surrender of the existing licence would remain unaltered. The committee then concluded that in all the circumstances they took into account there was no good reason to refuse the application.

[36] Such regard as the committee had towards the policy was purely in passing. I cannot construe what is said in the Statement of Reasons as an application of the policy. The committee did not need to consider the policy on its merits because of the second defender's offer to surrender what he presented as his existing licence for Unit 8. Had there been no such offer before the committee at the time when they were asked to make their decision on the application, then the committee could have been expected, in reaching their decision, to have focused upon the policy in a way that they did not have to do when faced with the offer.

[37] I have concluded that the committee should be afforded the opportunity to reconsider the application on its merits. They should do so in light of a changed material fact, namely, that there is no existing licence for Unit 8. They may then decide for themselves whether in that changed situation they are prepared to grant the application under paragraph 5(3)(d) despite that representing an apparent violation of the policy. It is not for me to decide that matter for them. The first defenders have their policy. Whether to apply it to the present application, and if so to what extent, is a matter for the committee, in the exercise of their discretion. That decision can be expected to involve a balancing of the material available to them and a reasoned assessment in light of whatever view the committee take of their policy. Certainly, nothing placed before me in the submissions or in the facts on which there was unanimity would entitle me to conclude that the committee could be expected to reach a decision contrary to the one which they did reach without further consideration by them of the second defender's application. In that situation it would it be appropriate for me to refuse to remit and to determine the application myself. I am satisfied that is not the case in the present appeal

[38] I have not followed the reasoning in the decisions of Leisure Inns (UK) Ltd and Mumtaz it seems to me that those cases deal with a different situation from the present one. In both Leisure Inns (UK) Ltd and Mumtaz the court criticised the licensing authority for a material flaw in the way in which they reached that decision and subsequently expressed it in their statement of reasons. In Leisure Inns (UK) Ltd the material flaw was the Licensing Board's conclusion that there was a strong possibility that the use of the premises would have a detrimental effect on the amenity of the premises of the objectors who were the householders of four dwellinghouses above the premises. The court was satisfied that there was no basis for that conclusion other than assertions from the objectors that their amenity would be affected (799F). The court held that basis to be unsound and inadequate(799F and H). In addition the reasons given by the board were inadequate in that anyone reading them would be left in real doubt as to the reasons for refusing the application (798K). Furthermore there was inadequate material before the board to hold that the ground for refusal had been made out and therefore no point in directing that the case be remitted to the board (798L to 799B). In Mumtaz the court held that the statement of reasons did not meet the requisite test of adequacy (86F to H), and that there was no material before the board entitling them to decide that if they granted the application this would result in children being exposed unduly to alcohol (86H to L). Because there was no adequate material before the board for holding that one of the valid grounds of refusal had been made out, the learned sheriff followed the decision in Leisure Inns (UK) Ltd and refused to remit the case to the board. In the present appeal the statement of reasons was founded upon by all parties without adverse criticism of the adequacy of the reasons contained in it. No one submitted that there was no material, or inadequate material, before the board entitling them to decide as they did or that the decision reached was unsound on the facts then before the board. In the present case the committee reached their decision on a basis of fact which at the time of making it was understood to be sound. It is through no fault of the committee that a fact which was material to their decision has subsequently been accepted as wrong at the time of making the decision. I have therefore concluded that the present appeal raises different issues from those addressed in those two authorities founded upon by Mr Henderson, and because of that they are not in point for the determination of the present appeal.

[39] For the foregoing reasons I sustain the third plea-in-law for the pursuers under deletion of the words "as craved with expenses" and in so doing reverse the challenged decision of the first defenders and remit the application to the first defenders for reconsideration. As a consequence of my treatment of the pursuers' pleas-in-law I repel the third plea-in-law for the second defender. As for the remaining pleas-in-law I shall repel all those tabled for the first defenders as requested by Mr Romano, and repel the first and second for the second defender because having regard to the way in which the hearing was presented neither plea was nor could be supported.

[40] Under paragraph 18(9) I may specify a date by which the reconsideration by the Board must take place and modify any procedural steps which otherwise would be required in relation to the matter by or under any enactment including the Act. I was not asked to address these issues and accordingly I make no order in respect of either of these two provisions.

[41] I indicated to parties that whatever my decision I would like a hearing on expenses. At that hearing I will also deal with the matter of sanction for the employment of Counsel.

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You are here: BAILII >> Databases >> Scottish Sheriff Court Decisions >> Matchurban v. City of Glasgow Council & Anor [2003] ScotSC 24 (31 January 2003) URL: http://www.bailii.org/scot/cases/ScotSC/2003/24.html Cite as: [2003] ScotSC 24

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