Update: licensing

The Gambling Act 2005 has been in force for nearly 18 months. Its implementation, especially compared with that of the Licensing Act 2003, has been virtually seamless. However, the cap it imposed on casinos saw a rush of applications for casino licences under the Gaming Act 1968 and the Court of Appeal being called upon to interpret the 1968 Act (R (on the application of TC Projects Limited) v Newcastle Licensing Justices [2008] EWCA Civ 428). There has also been a huge, although thankfully slowing, volume of secondary material to accompany the Act. A useful way for practitioners to keep up to date with this and other material is to subscribe to the Gambling Commission's fortnightly email bulletin (free of charge) at www.gambling commission.gov.uk/client/signup.

Improved response rate from licensing authorities

Alcohol, Entertainment and Late Night Refreshment Licensing published by the DCMS on 3 October 2008 contains detailed statistics for the period April 2007 to March 2008 and makes for interesting reading. The figures are more reliable than last year due to an improved response rate from the 378 licensing authorities (10 non-returns as opposed to over 50). However, the results must still be used carefully as a response rate of 97 per cent will give an underestimate of total numbers and response rates differed between questions.

With that caveat there were 207,800 licences and certificates in force in England and Wales on 31 March 2008, 190,000 premises licences and 17,100 club premises certificates. Of these, 155,400 were authorised to sell alcohol with 76,900 authorised for both off- and on-sales, 40,600 for off-sales only and 36,300 for on-sales only. Regulated entertainment was authorised on some 93,400 premises licences and 11,100 club premises certificates; while just over 66,500 premises were licensed for late night refreshment and there were 339,900 personal licences.

The headline figure that there were some 6,300 premises with 24-hour licences has to be seen in light of the fact that 3,900 of these were bars in hotels, with 3,100 available to residents and private guests only. A further 1,300 were supermarkets with only 650 being pubs, bars and nightclubs. There were 12,400 applications for new premises licences, which were granted in around 94 per cent of cases. Of 200 club premises certificates, just three were refused. There were over 1,000 reviews completed, with more than half instigated by the police. The outcome of the reviews was: revocations 160, suspensions 170, modified hours 160 and modified or added conditions 620.

Failure to address statutory test

Recent cases have successfully challenged the guidance issued to local authorities on both the Gambling Act 2005 and the Licensing Act 2003 (for example, Betting Shop Services Ltd v Southend-on-Sea Borough Council and 4 Wins Leisure Limited v Blackpool Licensing Committee (1) Brook Leisure Blackpool Limited (2) World Wide Clubs (UK)(3) '“ see Licensing Update Solicitors Journal, 17 June 2008, pp 24-25).

A further example is found in R (on application of South Northamptonshire Council) v Towcester Magistrates' Court [73] (Licensing Review, 15, April/May 2008), which concerned an application for a personal licence under s.120 of the 2003 Act. The claimant's licensing sub-committee granted a personal licence to an applicant despite an objection notice served by the Chief Constable of Northampton that the licence should not be granted as the applicant had two recent convictions for drink-driving. The Chief Constable's appeal to the defendant magistrates' court was successful, and the grant of the personal licence was overturned. The magistrates' decision was based on the DCMS Guidance at para.4.8, 'that where the police have issued an objection notice, refusal of the application should be the normal course unless there are '¦ exceptional and compelling circumstances which justify granting the application'.

The High Court held that the magistrates did not address themselves to the test for a personal licence under s.120. Rather, they expressed their views 'as to the approach of the licensing sub-committee in the context of the words of the Guidance as if it were the test'. As such 'the magistrates did err in failing to address the statutory test properly or at all', the application for judicial review was granted and the case remitted to the magistrates' court for determination by a differently constituted bench. Although the court did not hold that the guidance was wrong, as it differs from the statute that must be the case.

Unenforceable conditions

The use of conditions on a premises licence under the Licensing Act 2003 has raised a number of issues, been challenged in the High Court and formed the basis of many appeals to the magistrates' court. In R on the application of Westminster Council v Metropolitan Stipendiary Magistrate Marc Merran (first interested party) [74] (Licensing Review, 19, July/Aug 2008) modification of conditions on an application to vary a premises licence under s.35(4) of the 2003 Act was considered. The application, for longer hours, was made by the first interested party, one of the country's leading nightclubs located in Westminster City Council's 'West End Stress Area'.

As a deemed refusal (Westminster having failed to determine the conversion/variation application) the matter was first considered in the magistrates' court. The district judge allowed the appeal and granted the variation subject to a number of conditions necessary to ensure that the variation did not undermine the licensing objectives. Westminster judicially reviewed the district judge's decision on the basis that the conditions were drafted in such a way as to be unenforceable, which meant that the district judge's decision could not stand and the matter should be remitted to the magistrates' court to be reheard.

The High Court agreed that the conditions were unenforceable in their current form but refused to interfere with the district judge's decision that the conditions were sufficient; remitting the matter to the district judge for the conditions to be reworded along lines suggested during the High Court hearing and in consultation with the parties. There were long arguments as to the very considerable costs in the case. The claimant had succeeded in showing that the conditions were unenforceable, but not that the district judge's decision should be set aside.

Costs were awarded against the claimant in favour of the first interested party, but reduced by 50 per cent as the court held that much of the bundles of evidence prepared by the first interested party was unnecessary. The case emphasises three matters: the importance of conditions in the licensing process (here allowing the court to breach the West End Stress Area); the need for conditions to be clearly drafted so as to be enforceable; and the expectation that the parties will consult in an attempt to resolve matters without the need for recourse to the courts.

Variation applications

A variation for increased capacity was refused in Luminar Leisure v Wakefield Magistrates' Court [2008] EWHC 1002 (Admin). Here the court held that, even in the absence of a cumulative impact policy, issues of crime and disorder away from the premises and beyond the licence holder's control could be taken into account when considering a variation application.

Useful checklist

Although of limited authority, the decisions of district judges in licensing appeals, where reported, are proving very helpful. In Mark Andrew Clearly v Salford City Council [73] (Licensing Review, 27, April/May 2008) the district judge allowed an appeal against the refusal of the respondent's licensing sub-committee to grant an off-licence for a convenience store. The only representations came from local residents who argued that another outlet would increase the amount of anti-social behaviour in the area.

While accepting that new premises may be a magnet for 'troublemakers', the district judge held that the sophisticated measures adopted by the premises in their operating schedule (and as such conditions on the licence) meant that granting the licence would not undermine the licensing objectives or add to the cumulative impact of premises in the area. The decision again underlines the way in which conditions may allow an application to proceed and also provides a useful checklist of the sorts of measures required for responsible retailing from off-licence stores. (See also Daniel Thwaites PLC (Claimant) v Wirral Borough Magistrates' Court, Licensing Update, Solicitors Journal, 17 June 2008, pp 24-25.)

Public nuisance

A common debate in licensing applications centres on what is meant by 'public nuisance' for the purposes of the licensing objectives. This was considered by a district judge in Crosby Homes (Special Projects) Limited v Birmingham City Council (1) and Nightingale Club(2) [75] (Licensing Review, 26, October 2008). A review of the premises licence of the second defendant on the grounds of prevention of public nuisance had been brought by Crosby Homes and dismissed by the respondent's licensing sub-committee. The basis for the review was that the occupiers of a new residential block being developed by Crosby Homes would suffer public nuisance in the form of noise from the nearby Nightingale Club.

The district judge held that the noise generated by the club did not amount to a public nuisance and in particular noted that the planning permission granted for the residential block contained conditions designed to minimise the effects of such noise. The case contains the seeds of the idea that the nightclub which had been operating for some 40 years should not be adversely affected by a new development. It also recognised a distinction between the meaning of 'public nuisance' in planning and licensing matters.

'Get tough' policies

The 'get tough' approach to alcohol-related crime and disorder, including underage sales of alcohol, continues. Regulations have been passed to allow for the adoption by local authorities of the controversial Alcohol Disorder Zones and the Home Office has announced that Drinking Banning Orders, also contained in the Violent Crime Reduction Act 2006, will be introduced this summer.

Measures contained in the Queen's speech in December 2008 included plans for a mandatory code banning offers such as 'all you can drink for £10' and targeted promotions (for example, 'half-price drinks for women'); reducing the 'three strikes' rule for underage sales to two sales within a three-month period; an extra £4.5m to be spent on enforcement activity; increasing fines for consuming alcohol in a designated public place and the introduction of a new offence of persistently possessing alcohol in a public place; bans on discounted bulk purchases of alcohol and of advertising cut-price alcohol; and compulsory training of staff who sell alcohol.

The Policing and Crime Bill which received its second reading on 12 January 2009 contains measures designed to tackle what the government terms irresponsible retailing of alcohol. The Bill also provides for increased regulation of lapdancing and sex encounter establishments. The Bill, which by then should be an Act, will be fully covered in the next Licensing Update.