In Defence Of Small Licensees – Festac V London Borough Of Islington

01 Jan 2018

Licensing, Public Law and Judicial Review

If you act for a large organisation – a pub or night club chain say – which has had trouble at one of its venues, an experienced licensing practitioner’s first thought is always to find a sacrificial lamb to stave off or defend a review. The plea is that the organisation does not invite, incite or condone breaches of condition, drunkenness or poor management, and so it has been necessary to make personnel adjustments to ensure that the untoward event(s) will never again be repeated. Such adjustments may involve losing the DPS or the door company, or both. The ritual sacrifice performed, the Gods of licensing declare themselves well pleased, and the rumbling from the heavens ceases.

If, however, you act for a small licensee – the owner of a corner shop or small pub say – who has bought suspect goods off the back of a van or been less than assiduous with observance of licence conditions, the story can be very different. Now, the licensing authority or police will maintain that much as it might be desirable to sacrifice the DPS, any new DPS would be answerable to the same owner, who cannot be trusted, so sadly the licence must fall, and with it the business and livelihood of the licensee. The argument is advanced with even greater force if the licensee also happens to be the DPS, a common occurrence in small businesses. Removing the DPS is gumming at the capillaries when nothing short of severing the artery will do. This argument is routinely accepted by licensing sub-committees and magistrates.

Until now.

Festac is an acronym for a Nigerian festival of arts and culture. Less gloriously, it is also a small bar and nightclub half way up the Holloway Road. Among the alleged misdemeanours of its licensee were: failure to report a stabbing; mopping up the blood; operating without functional CCTV; disconnecting a noise limiter whose level had been set by the Council; turning up the sound levels immediately following an officer visit; repeatedly breaching a last entry condition even following a police visit etc. The Licensing Sub-Committee revoked on the conventional basis: the licensee could not be trusted, so no matter whom he employed to run the premises they would be answerable to him, so there was no option but to euthanase the business.

The appeal, however, came before an enlightened panel of Justices. They accepted that it is possible, even in a small organisation, to separate out, on the one hand, business and hospitality functions and, on the other, compliance functions. The fact that statute requires the appointment of a Designated Premises Supervisor who is him/herself a personal licensee in their own right, is proof of that particular pudding. They followed a suggestion of a condition that the licensee should not directly participate in matters of compliance, and that there should be a DPS present at late night events who would be individually responsible for ensuring compliance. On that basis, the appeal was allowed and the licence saved.

While this solution will not always be apposite, it underlines an important point. If the immutable rule is that large businesses can make mistakes but small businesses can’t, the rule acts discriminatorily against small businesses. Engaging with small businesses can sometimes be frustrating for licensing authorities, since proprietors may not do “licensing speak” in the way that solicitors and other representatives acting for larger organisations invariably do. Solutions may be less easy to find. But it is no less important to try to find them. If a route can be identified to enable a small business person to retain their licence, it is incumbent on all in the system to do so, and not automatically to reach for the mantra that the root of the problem is the licensee so only revocation will do. Festac is no binding precedent, but it is an example of how an imaginative approach can be used to save a business and give it a further chance.

An important footnote is that the Council was ordered to pay the licensee £9,000, even though its basic case about mismanagement was accepted. This was because it had been encouraged to negotiate by the Justices at the case management hearing, but had declined to do so. This was considered to be unreasonable. This highlights a further lesson in good practice. Whether or not the decision itself was right at the time, circumstances do change. As Hope and Glory instructs, the job of the appeal court is not to review the decision made, but to decide based on the current evidence whether the decision is wrong. If the licensing authority unreasonably fails to engage with emerging narratives in the case, it will rightly face costs applications from successful appellants.

Philip Kolvin QC, who acted for Festac, is the Head of Cornerstone Barristers and the Patron of the Institute of Licensing.

This article was first published in Local Government Lawyer