What is a local authority entitled to take into account when deciding whether or not to renew a sex establishment licence for a lap dancing club?  That was the issue before the Court in Thompson v Oxford City Council [2013] EWHC 1819 (Admin).  Haddon-Cave J held that the fact that the character of an area was in the process of changing was a relevant consideration when deciding upon the appropriateness or otherwise of such a licence in accordance with Schedule 3 to the Local Government (Miscellaneous Provisions) Act 1982, as amended by Section 27 of the Policing and Crime Act 2009.

At paragraph 50 of his Judgment he summarised the general principles to be derived from the authorities regarding the licensing of sex establishments as follows:-

(1)        Local authorities are granted a very wide statutory discretion to decide whether or not a licence should be granted;

(2)        Local authorities can take into account “any strong body of feeling in the locality” which objects to the existence of a sex shop there, although this does not include moral objections to its activities;

(3)        The legislation expressly contemplates that the circumstances in which a licence has been granted or renewed may change and there can be no expectation of annual renewal;

(4)        Local authorities have “a very broad power to make an evaluative judgment” whether the grant of a licence would be inappropriate having regard to “the character of the relevant locality”: this imports “a significant evaluative power” at two levels: first, in assessing whether the grant or renewal of the licence would be “inappropriate” (a very broad and general concept); and, secondly, in assessing the character of the relevant locality, which, again, involves questions of fact and degree and local knowledge which import, at that level also, a broad power of evaluative judgment to be exercised by the local authority;

(5)        There is no radical conceptual divide between “the character of the relevant locality” and “the use to which any premises in the vicinity are put”: the former is a concept calling for “a compendious and general evaluative judgment to be made by the authority”, having regard to a range of factors which may be relevant to that question, including not least the use to which properties within the relevant locality happen to be put, the latter simply provides an additional ground for refusal if, eg, it cannot be said that it would be inappropriate to grant a licence given the general character of the locality, but the use of particular premises within the vicinity does give cause for concern viz eg a church, or primary school;

(6)        The considerations were intended by Parliament to be considerations for the local authority’s own evaluative judgment, subject only to the Court’s supervisory jurisdiction on a claim by way of judicial review.

At paragraph 68 the Judge said:-

“…  licensing decision-makers are entitled to take into account both the present and future “character” of an area. There is no reason to limit the reference to “character” only to the present character of the area. Indeed, it would make no sense to do so in the context of prospective licences which were to be granted for 12 months in the future. Prospective licences required a prospective view. The fact that an area is developing and in a continued state of change is a relevant consideration to why renewal might be inappropriate.”

In Cusack v Harow LBC [2013] UKSC 40 the Supreme Court has held, reversing the Court of Appeal, that the Council as highway authority was not required to pay compensation for the erection of barriers preventing a property owner accessing a public highway from his property.  The Council had power to proceed under Section 80, which does not provide for compensation, rather than Section 66(2) of the Highways Act 1980 (“HA 1980”), which does provide for compensation.  The Supreme Court observed that, albeit the owner of a property adjoining a highway has a common law right of access to the highway, without restriction, from any part of his or her property, that right has been greatly limited by statutory provisions and there is no general right to compensation when action is taken to restrict a property owner’s right of access to an adjoining highway.

Canons of statutory construction, including the principle that a specific statutory provision excludes the application of an inconsistent and more general statutory provision, have a valuable role to play as guidelines embodying logic or common sense.  However, the distinction between general and specific statutory provisions was of no assistance in this case because neither Section 66(2) nor Section 80 of HA 1980  could be regarded as more specific or less general then the other.  HA 1980 is a consolidating statute and is the result of a complex history extending over more than 130 years. It contains a variety of overlapping and sometimes inconsistent powers. The Council was entitled to rely on the clear wording of Section 80 in order to erect the barriers. It did not matter that the Council could use Section 66(2) to achieve the same objective. However, a highway authority’s use of Section 80 could be challenged if, for example, it circumvented the specific prohibitions of the use of the power conferred by Section 66(2).

The Human Rights Act 1998 did not preclude the Council from relying on Section 80 because it involved no breach of the right to peaceful enjoyment of property under Article 1 of the First Protocol to the ECHR (“A1P1”).  The erection of the barriers would be a control of the use of property, not a deprivation of property. The case concerned land development and town planning, in relation to which the State enjoys a wide margin of appreciation. The issue of the proportionality of the interference with A1P1 rights requires a broad judgment as to where a fair balance lies between competing general and individual interests.  The mere fact that another statutory route was available to the Council and that it required the payment of compensation did not itself lead to the conclusion that the Council’s reliance on Section 80 was disproportionate. There is no general rule under A1P1 that, where the State seeks to control the use of property and could do so under two different provisions which have different consequences in terms of compensation, it is obliged to use the provision which carries some (or greater) compensation.

Section 15(4) of the Commons Act 2006 (“CA 2006”), in relation to registration of town and village greens (“TVG”), is compatible with the right to peaceful enjoyment of possessions pursuant to Article 1 of Protocol 1 to the ECHR (A1P1).  So the Court of Appeal has held in R (Newhaven Port and Properties Ltd) v SoS for DEFRA, East Sussex County Council and Newhaven Town Council [2013] EWCA Civ 673. The Port did not argue that the TVG scheme as a whole is incompatible with A1P1. It accepted that that argument was barred by Oxfordshire County Council v Oxford City Council [2006] 2 AC 674.  The challenge was to Section 15(4) of CA 2006, which applies (broadly) where (a) a significant number of the inhabitants of any locality indulged “as of right” in lawful sports and pastimes on the land for a period of at least 20 years, (b) they ceased to do so before the time of the application but before the commencement of Section 15, and (c) the application is made within the period of five years beginning with the cessation referred to in paragraph (b). By Section 15(1) any person may apply to the commons registration authority to register land to which Part 1 of CA 2006 applies in a case where subsection (2), (3) or (4) applies.

The Port argued that the effect of Section 15 (4) was to deprive it of the statutory defence by which it could have defeated any application which had been made before the Section came into force, namely by demonstrating that use had not continued until the date of the application. The Port argued that in so doing Section 15 (4) is incompatible with A1P1.  It was common ground that CA 2006 (and Section 15 (4) in particular) is an interference with the Port’s peaceful enjoyment of its possessions because it significantly restricts what activities the owner can carry out on the registered land. Thus A1P1 is engaged. It was also common ground that the jurisprudence of the European Court of Human Rights has established that A1P1 involves three distinct rules: the general principle of the peaceful enjoyment of possessions; a rule against deprivation of property, and right on the part of states to control the use of property in the general interest but subject to the striking of a fair balance between that interest and those of the property owner.  It was also common ground that registration of a TVG does not involve a deprivation of possessions, because legal title remains with the owner. This was, therefore, a case of control of use, falling within the second paragraph of A1P1. Lastly it was common ground that the interference had taken place subject to conditions provided for by law; in the sense that the law is clear and accessible. The key issues, therefore, were whether the contested legislation pursues a legitimate aim; and, if it does, whether the means by which it does so are reasonably proportionate to achieving that aim.

The Court of Appeal held that Section 15(4) does have a legitimate aim.  The key issue was that of proportionality.  The Court of Appeal held that the means by which Section 15(4) pursued the legitimate aim, including the period of grace being 5 years rather than a shorter period, are not manifestly without reasonable foundation.  It had been open to the Port to prevent the twenty years use as of right from coming into existence at all.  The Port’s bye-laws amounted to consent to the uses on which the local inhabitants relied.  If the Port had displayed the bye-laws on the quayside or the sea wall the whole problem would have been eliminated.  Moreover, all landowners have effectively been put on notice that those using their land for recreational purposes may well be asserting a public right to do so if their use of the land is more than trivial or sporadic. 

What is the relationship between judicial review and the intervention powers of the Secretary of State (“the SoS”) in relation to changes in local library provision? On 31 May 2013 the SoS announced her decisions not to direct Inquiries under the Museum and Libraries Act 1964 into such changes in the Isle of Wight and in Bolton.

The SoS stated the Principles as follows:-

“The Secretary of State has considered the duty of a local authority to provide a comprehensive and efficient service under section 7 of the 1964 Act. What constitutes a comprehensive and efficient service is a question involving a significant element of judgement. Those judgements are, in the first instance, for the local authority to make. It has good knowledge of local conditions and needs and has direct democratic accountability to the local population. This is a significant factor. The Secretary of State’s view is that decisions about local issues should ordinarily be taken by democratically elected local representatives accountable to local voters. The duty of the Secretary of State is one of superintendence. A wide range of approaches were open to the local authority when deciding how to provide a comprehensive and efficient library service. The Secretary of State also notes that the local authority is entitled to take account of cost in deciding whether a proposal is efficient.

The Secretary of State seeks to promote and secure the proper discharge of the statutory duties on local authorities.  She has power to direct a local inquiry. Her approach in deciding whether she is minded to intervene to direct an inquiry has been to ask herself whether, having regard to the duties on her and the local authority, there is good reason in all the circumstances for her to direct an inquiry at the present time.

In taking that decision, the Secretary of State has given consideration to a number of factors. They include:

• Whether there is any serious doubt or uncertainty as to whether the Council is (or may cease to be) complying with its legal obligation to provide a comprehensive and efficient library service.
• Whether the Council appears to be acting in a careless or unreasonable way.
• Whether the decision is or may be outside the proper bounds of the Council’s discretion, such as a decision to stop serving a particularly vulnerable group.
• Whether the Council, has failed to explain, analyse or properly justify its proposals.
• Whether the local proposals are likely to lead to a breach of national library policy.
• Whether substantial further investigation is needed. A local inquiry would be more likely to be appropriate in a case where there are substantial uncertainties as to compliance with the statutory duty, and inadequate public consultation and discussion of proposals.  The converse is also true.
• The advantages of local decision making by democratically accountable local representatives.
• The cost and delay of an inquiry.
• Whether there is any further good reason why a local inquiry would be appropriate or inappropriate.

The Secretary of State has also borne in mind that too ready an intervention would risk preventing or discouraging prompt and efficient reforms of library services. Equally, failing to intervene in an appropriate case would risk the delivery of an efficient and comprehensive service.”

There were two particular features in the case of the Isle of Wight.

First, as regards community libraries, the SoS said:-

“For the purposes of her assessment as to whether to order a local inquiry, the Secretary of State has based her view solely on the council run libraries, and the mobile library service.  The community libraries have not been taken into account, although they appear to be successful and to form an important part of Island life.  Accordingly, if the community service were to be taken into account, it would only reinforce the Secretary of State’s view.”

Second, the SoS noted that a claim for judicial review of the changes failed, and that permission was refused on grounds not only that there had been delay in bringing the claim, but also that, in any event, the claim was not of sufficient merit to justify the grant of permission.  She said:-

“In the view of the Secretary of State it is clear that the Isle of Wight continues to offer a comprehensive and efficient library service through its core libraries and mobile library service.  The Secretary of State has taken into account that the Court has decided that the changes were lawful (and it was unarguable to suggest the contrary).”

The costs of enforcing a licensing system (of sex establishments) against unlicensed operators (who may not have applied for authorisation) cannot be reflected in licence fees charged by a local authority (under the Local Government (Miscellaneous Provisions) Act 1982).  So the Court of Appeal has held in Hemming v Westminster City Council [2013] EWCA Civ 591, upholding Keith J.  This is because such costs are not (proportionate) costs of “authorisation procedures and formalities” under an “authorisation scheme”.  They are therefore prohibited by the EU Services (in the Internal Market) Directive and the Provision of Services Regulations 2009, SI 2009/2999.  In order to justify a (licence) fee or charge it has to be shown that it is related to the cost of the actual authorisation process: Beatson LJ at para 84.  The Court rejected (para 98) the “consequentialist arguments” about the effect on other regulated areas advanced by the Council in support of its construction.  The Court, however, accepted (para 103) that not only can costs in investigating the suitability of an applicant be reflected in the fee, so too, in the case of an application to renew a licence, can be the costs of monitoring the applicant’s continued suitability and compliance with the licence terms.  Enforcement against licensed operators is to be distinguished from enforcement against unlicensed operators.