“Lawyer: Holyrood approach ‘arrogant’ ” – My Justification

“Scottish Government’s legislative style slammed at conference”

As the person responsible for these rather lurid headlines from the latest issue of  the Scottish Licensed Trade News, perhaps I should be among the first to comment. The article was based on my address to Jack Cummins’ recent SLLP conference in Glasgow. I can have no complaint about the reporting. In the article I was  correctly quoted and the headlines are an accurate summation of my views. Those who did not hear the substance of my address might well feel themselves justified in writing this off as the posturings of a headline seeking lawyer in search of business, and dismiss it as Johnston on another of his rants.

Let me deal with the latter points. As I am no longer in private practice, I seek no business. As to seeking fame, or infamy, after nearly forty years in the business, I am well enough known. Let me turn instead to the reported straplines of my talk. As valuable newspaper space did not permit full detail, I want to demonstrate that I can justify each and every one of my fairly trenchant criticisms. I note that in response a Scottish Government spokesman stated the aim “to make sure legislation is not unduly burdensome or complicated.” Forgive me a sardonic smile. If that is the case, why not issue a consolidating statute so that the bewildered licensee who has the responsibility of teaching the law to his staff doesn’t have to wade through 4 statutes and 40+ sets of regulations? We now have a piece of legislation which has sections 39(2A), 39(2)(a) and 39A(2)(a).  He went on to say, “That is why the recent Air Weapons and Licensing (Scotland) Act 2015 addressed parts of the law which were not operating as effectively as they could have been.”

One can only assume that he was referring to the reform of the transfer provisions, which I described as a mess. Yes, we got some reform (after 10 years of agitating), but there was nothing at all in the original Bill. In fact the changes were not introduced until the Stage 2 part of the process, by which point there was no time for comment. I welcome the long overdue reforms but deplore an obvious flaw which will have to be addressed when a licensee departs in acrimonious circumstances and someone, often the owner of a property whose value will plummet without a licence, is trying to keep the business asset intact. A person seeking transfer of a licence must now produce evidence of consent to transfer. Fair enough. But this must be written and signed. That would appear to rule out email, which must constitute 80 – 90% of modern communication. 10 years ago we ditched the requirement for objections to be written or signed, for just such a reason. As those who have been at the sharp end know, it is not uncommon for licensees in financial difficulty, as so many are, simply to want to give up. This may leave a bank or insolvency practitioner trying to sell licensed property. What if the licensee does not issue consent? In those circumstances a hearing must be held.

Section 33A(4) allows the Board to dispense with consent if satisfied that the transferee has taken all reasonable steps to contact the premises licence holder in order to obtain consent  BUT HAS RECEIVED NO RESPONSE (my emphasis). There is no provision for a Board to decide that the consent is being unreasonably withheld, or to waive the “written and signed” requirement. What if a licensee whose pub has been repossessed and who clearly has no further right to occupy it simply refuses his consent? Or if an insolvency practitioner demands an outrageous premium for a consent? Or if, most frustratingly of all, the licensee sends an email saying, “fine by me”, but not a signed consent? In these circumstances the transferee has indeed received a response, but some boards may feel themselves obliged to refuse the application because, on a strict interpretation, the section 33A(4) test hasn’t been satisfied. A moment’s consultation with the Law Society experts could have ironed out that sloppy, ill considered drafting.

I criticised the additional burdens imposed on Licensing Boards in a climate where many of them are being forced to shed or share staff because of financial cuts. Is this then really a good time to impose the requirements for “Annual functions reports” and “Annual financial reports”. While those of us who believe that licensing charges at the applications stage were skewed might have welcomed the latter ten years ago, I am not sure what function they will serve now. I also suspect there will be huge scope for creative accounting as licensing boards are landed with their share of the council’s depreciation bill and the Provost’s motor expenses. I have even less idea of the benefit of the former. Any clerk needing assistance in fudging issues should simply read the Stage 1 report for this legislation. What possible good will these do? What purpose will they serve? Who will read them? My  view is that licensing boards are, in the main, operating to a higher standard than at any time since they were created by the 1976 Act. Will their work be enhanced by such a deployment of precious  resources?

Finally, I accused the legislators of producing a statute which was self contradictory. Let me place before you Production number 1, the new s39B. If at a review hearing it is established that the licence holder is not a fit and proper person to be the holder of a premises licence, the Board is obliged to revoke the licence. S39B provides relief by way of a mandatory recall of this revocation if, inter alia,  a transfer application is made within 28 days. Or does it? Let us examine the legislation.

“S 39B(2)The Board must recall  revocation if-

(a)   a relevant application* is made before the end of the period referred to in section 39(2B) (“the 28 day period”), and

(b)   the Board grants the application”

(* ie an application for transfer or variation – my notes)

Taken by itself I think the interpretation is fairly clear. You are entitled to a recall provided you get your transfer application in within the relevant period and the application is eventually granted, whenever that might happen. We all know these things can take a while, especially if the application goes in only on day 27. Even if it is lodged on day 1, the police have 21 days to respond. In short, it is far from certain that your application will be processed in 28 days, unless you are lucky. But read on.

“39B(3) The Board may extend the 28 day period pending determination of a relevant application.”

That would seem to contradict the interpretation I have just suggested. If simply getting your application in on time is enough, why do we need 39B(3)? And note the use of  word may. From day 1 to day 28, you are entitled to get back the benefit of the licence as a matter of right: beyond day 28 you are at the mercy of the board’s discretion. Legislation doesn’t come much more self contradictory than that. I have no idea what Parliament intended and have no idea what the law actually is.

I had much more to say in my address. It was by no means critical of everything in the new Act, but I would contend there is enough material to justify my less than complimentary overview.

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Minimum Pricing: The Latest

On 3 September Yves Bot, the Advocate General, (AG) issued his opinion in the latest stage of The Scotch Whisky Association & Ors v The Lord Advocate Case C-333/14 http://is.gd/nenkNZ . It runs to eighteen pages and is inevitably complex. Space constraints mean this can be no more than a brief summary. The case centres on the legality of the Alcohol (Minimum Pricing) (Scotland) Act 2012 proposing what has come to be known as minimum unit pricing (MUP).

If you read the press you would note that both sides were claiming victory. In fact there is a long way to go. The pursuers had appealed to the Inner House, which in turn asked the European Court of Justice (ECJ) to issue a preliminary ruling.  Procedurally the matter next goes to the full ECJ. While the ECJ will often follow the AG’s opinion, it is not obliged to do so. It is likely to take another six months or so for a full decision.

In summary, from paragraph 2 of the AG’s opinion, the request was for a ruling on whether MUP was compatible with EU rules. It appears that most commentators have read no more than the first couple of pages. In fact a total of six questions were posed, the issue of what I may call “inherent incompatibility” being but one of them. For those, like me, for whom some of the acronyms in the opinion were unfamiliar, a brief explanation. TFEU is the Treaty on the functioning of the EU. There is also much reference to a “single CMO regulation”. A CMO  is a common market organisation. Once upon a time under the Common Agricultural Policy there were twenty one of these. Much needed simplification produced a single Regulation establishing a common organisation of the markets for agricultural products, the Single CMO regulation. Apologies to those who already know this, but the opinion is tricky to follow if you don’t.

The Scottish Government has taken heart from the AG’s view that rules imposing MUP of alcohol would not “by their very nature be contrary be contrary to the system and be harmful to it.” There are however, important caveats. The AG’s proviso is “provided these rules are justified by the objectives of the protection of human health and in particular the objective of combating alcohol abuse, and do not go beyond what is necessary in order to combat that objective.” (my emphasis). The next important stipulation relates to one of the main tenets of all EU law, proportionality. Easy to say, more difficult to define. There is an excellent exposition on page 8 of M. Bot’s opinion, where he recommends a three stage process. Firstly, is the proposed act suitable for the aim sought? Secondly, the “Minimum interference test”, ie can the same objective be pursued in a manner imposing fewer restrictions on trade? Thirdly, compare the extent of the interference with the contribution which that measure could secure for the protection of the objective pursued. It is made quite clear that these are matters which are to be answered by the national court.

Another important question is considered is whether the proposed objective could not be attained in a less restrictive and equally effective manner by higher taxation. This was an argument put forward, in a miasma of hypocrisy, by the SWA, well aware that public opinion would not swallow it. In analogous tobacco cases, however, the ECJ seems to have come to that conclusion, taking the view that such action would be less disruptive of trade between member states.

I find paragraph 141 of particular interest. “It is only where the Member State has a choice between different measures suitable for attaining the same aim that it is under an obligation to have recourse to the measure least restrictive of freedom of trade within the European system.” Noone seems to have addressed the unique situation of a member state, the UK, one of whose parts has a separate legal system, but does not have the power to effect the taxation changes which might be an alternative. Were I in the Government camp I would be looking at that with interest.

Nothing, of course, is simple. If the ECJ agrees with the AG, the matter will come back to the Inner House next year. Whatever it decides will go to the Supreme Court. Will this preliminary referral to Europe be enough to prevent a further appeal to the ECJ? Probably not. Don’t bet your house on the matter being resolved this decade.

This article first appeared in the October edition of the Journal of The Law Society of Scotland

Beware The (New) Transfer Traps

I was brought up to believe that if a job was worth doing, it was worth doing properly. From the time that the bill which became the Licensing (Scotland) Act 2005 was published, licensing lawyers unanimously condemned the transfer provisions as unworkable. This flaw was shamefully overlooked in both of the subsequent acts and, astonishingly, was omitted from the Air Weapons and Licensing (Scotland) Bill. The Law Society’s Licensing Sub-Committee is not fobbed off lightly and continued to press the point. For once there is some good news; however, before we start the dancing in the streets of Raith and elsewhere, read on.

Let us begin with the positive. Section 34 is repealed, removing many anomalies surrounding insolvency and business transfer. It will still be necessary to make an application within 28 days of insolvency, death etc, but this may be made by anyone. Section 33 is largely amended under the heading Application for transfer of premises licence. The starting point will be that any person of 18 or over may apply for the transfer of a premises licence. Protections for the licence holder are provided. All applications must be accompanied by a written statement signed by the holder consenting to its transfer to the transferee or, if that is not practicable, a statement of the reasons for failure to obtain such written consent. There seems to be no provision for the consent to be signed by an agent, or for an electronic consent, which could pose problems where the licensee has left the country. What of a blanket consent obtained at the beginning of a lease? Must the precise identity of the transferee be specified?

There will be a new section, 33A, which fails adequately to deal with the absence of consent. Section 33A(4) allows the Board to dispense with consent if satisfied that the transferee has taken all reasonable steps to contact the premises licence holder but has received no response (my emphasis). This is thoroughly unsatisfactory. What if an evicted tenant who clearly has no further right to occupy the premises simply refuses his consent? Or if an insolvency practitioner demands a premium for a consent? Or if, most frustratingly of all, the licensee sends an email saying, “fine by me”, but not a signed consent? In these circumstances the transferee has indeed received a response, but some boards may feel themselves obliged to refuse the application. In the absence of consent, a board must hold a hearing. That is reasonable, but no time limits are given. One can imagine significant delays.

A further problem is that, even if a board decides to exercise a common sense approach, an existing licence holder will have a right of appeal against the decision to transfer his licence. All he will have to show is that he responded to the request to consent. While a licensing board may well be prepared to take a pragmatic approach, a Sheriff may well consider herself obliged to take a literal interpretation.

In non-controversial cases the problems of timing have not been addressed. Section 33(5) will remain in force, allowing the police 21 days to respond to an application for transfer. Where there is a conviction to be notified, the board must hold a hearing, even if there is no recommendation for refusal. That will apply even if there is a minor or irrelevant conviction (for example, a conviction under Health and Safety legislation where there is strict liability). Even if the applicant has an unblemished record, there is no provision for an instant, temporary transfer of licence. The new section 33(1A)(a) will allow the applicant to specify the date upon which the transfer is to take effect, but I do not read this as allowing a transfer to take place in advance of receipt of the police report. Commentators have highlighted the huge practical issues in the sale of packages of licensed premises. In Scotland, even in the days of a unified police force, the time taken to process applications varies widely. Where the package is a cross border one there will be stark contrast with the position in England, where an interim transfer is possible.

The Law Society’s proposed further amendments which would have dealt with these problems have been ignored. Conclusion? Some credit to the Government for agreeing at last that the job needed doing: a crying shame that it has failed to do it properly.

OBJECT TO THIS OBJECTIVE

This is the second of two blogs on the Stage 1 report to the Air Weapons and Licensing (Scotland) Bill. In it I will discuss two further recommendations, one relating to occasional licences, the second regarding a proposed sixth licensing objective.

The recommendation at paragraph 276 is that a licence to sell alcohol should not automatically cover the provision of public entertainment. If no public entertainment licence exists one must be sought, if required, as part of the occasional licence application. The definition of public entertainment under the Civic Government (Scotland) Act 1982 is very wide indeed. At present a public entertainment licence is not required for entertainment being provided within licensed premises during the permitted hours.

The committee’s concern may be fairly summarised by the contents of paragraph 225.

The exemption from the requirement to obtain a Public Entertainment Licence if an alcohol licence is in place should be removed as occasional liquor licences are increasing (sic) being used to licence events which would otherwise be licensed under the 1982 Act. For example large music events. This issue is exacerbated by the fact that Boards cannot enforce any conditions upon an occasional licence that are not connected to the sale of alcohol.

While I have some sympathy with the issue raised I am highly suspicious that the local authorities which raised it had an eye to the larger fees which they may extract for public entertainment licences, but perhaps that is to be over cynical. I have no sympathy whatever with the daft notion that Boards cannot enforce any conditions upon an occasional licence that are not connected to the sale of alcohol. That seems to stem from a ludicrous interpretation of the Brightcrew case. It ignores the fact that conditions may be attached to a licence on any matter relevant to the existing five licensing objectives. Licensing conditions are of course enforceable, and are monitored by police, LSOs and Environmental Health departments.

What is of greater concern is the potential for one event to be covered by two different licences issued by two separate licensing authorities under two separate pieces of legislation. The possibilities for confusion (to say nothing of local authorities finding new ways to make themselves look very foolish) are legion. The one piece of good news, for those worried how it will impact on their daughter’s wedding, is to remind everyone that a public entertainment licence is required only where members of the public are admitted on payment of money or money’s worth.

 By far the most eye catching and controversial  recommendation, at paragraph 269, is that given the overwhelming evidence we received of harm and links to disorder from overconsumption, an additional objective be added to include the reduction of consumption. Not only did this take everyone by surprise, it did not seem to come from any particular submission or evidence given. One has to read the whole report carefully to find any mention of it at all. That comes in the final paragraph in the overprovision section which reads-

Licensing Objectives

199.

Section 41 of the Bill amends one of the licensing objectives to add “young persons” to the existing Board objective “to protect children from harm”. This change was welcomed by all who commented on it. We also heard the licensing objectives do not require the policy of boards to include the reduction of consumption. It was also suggested each of the five objectives could be viewed as contributing to wellbeing with a specific objective of “protecting and improving public health”.

I am not aware of the trade being given any warning this was in contemplation, or being asked to comment. It is, in my view, highly significant that this was inserted in the overprovision section. The health lobby maintains the view that consumption is causally linked to availability. Most are yet to be convinced by the empirical evidence for this.

An summary  of the argument would seem to go like this: some people in Scotland drink too much, therefore those who can legally sell alcohol, including those who sell sensibly and responsibly, must be made to sell less.

Let’s now look at a few facts. Those who sell for consumption off the premises have no control over when, and by whom, what they sell is consumed. How is this to be policed? If the health lobby decide to instigate a licence review, will the retailer have to show that his turnover decreased year on year? That his current business plan projects a decrease in profits?

What about those in the on-trade? If the concern is the dangers of over consumption, that sector is already regulated by the rules against selling to those under the influence. Difficult to police and enforce, granted, but the fact is that these laws are there, albeit seldom enforced. With the health lobby actively spreading its propaganda that more premises means more consumption (in the face of statistics which clearly show that Scotland’s alcohol consumption, thankfully, has been on the decrease for some years now) getting any type of new licence may prove impossible. If a board can cite overprovision to justify refusing Marks & Spencer a couple of extra metres of shelving, it will be possible to use that ill considered objective to refuse any new application for any variation which involves an extension to premises.

We have heard from the Scottish Government that this is not their policy. The same Government, of course, which “continues to consider the concerns raised” about the transfer issues.

AIR WEAPONS AND LICENSING (SCOTLAND) BILL: WHAT WILL THE ACT LOOK LIKE?

The Local Government and Regeneration Committee has published its Stage 1 Report on the Air Weapons and Licensing (Scotland) Bill. The full report can be accessed at http://bit.ly/1bTv0Mr. The liquor licensing recommendations are in sections 261 – 283. It is a shoddy, slapdash piece of work. I would be mortified if, in any paperwork leaving my organisation, the word licence appeared as license even once. In the three pages of recommendations the word is misspelled eight times, appearing in its correct version only four. For a Government department, this is inexcusable. I suppose they will tell us that something has went wrong, or that someone done bad.

Getting into the substance of the recommendations, my previous blog bemoaned the fact that the opportunity will almost certainly be missed (again) to rectify some of the serious practical problems which exist. Reading the distilled reasons in the recommendations makes it clear how little the issues are understood. The recommendations do comment on surrenders and site only applications, but transfers do not even merit a mention.

Many of the recommendations are unsurprising, endorsing the content of the original Bill. No-one could object to young persons being added to licensing objective 4(1)(e). No surprise about licensing boards being allowed to designate their whole area as overprovided. My view is that they could do that anyway. The fit and proper test will return, although we do not yet know if this will be defined. Paradise for lawyers if it is.

Some recommendations will affect only licensing boards. The committee was much taken with the views of those who said that boards should be more accountable. It is recommended that reports should be issued within six months of the year end containing information on how the board “has delivered” in relation to licensing objectives. Expect too a toughening up on clubs, in particular a requirement to comply with their constitution. Unclear, however, how this will work in practice. Will it apply only to new licences, or will clubs be required to vary their licences in some way, perhaps by the terms of the constitution becoming conditions of the licence? The committee’s main concern reflected the evidence from the Scottish Licensed Trade Association that many clubs flout their own rules and operate as mainstream licensed premises. No one has considered that it would be very easy to change club constitutions. Many of these so called “safeguards against abuse” arose because club constitutions had to comply with Part VII of the Licensing (Scotland) Act 1976, now, of course repealed. Health boards are to be encouraged to be more proactive: as they already have significant rights at present, that is no great change.

It is depressing to see that spent convictions are to be admissible. The whole purpose of the Rehabilitation of Offenders legislation was to allow people to move on, having tholed their assize and lived blameless lives for a number of years. Why are people in the licensed trade somehow different?

But a closer analysis of the recommendations discloses either an ignorance of the current law, or a couldn’t care less attitude on the part of the committee and its advisers. Under the heading Occasional Licenses (sic), recommendation 274 reads, “we expect to see section 57 of the Bill commenced without delay.” Well, firstly, it can’t be implemented until the Bill becomes an Act. Is the committee unaware of this? Secondly, section 57 of the Bill is the section designed to give some relief to those whose personal licences have been revoked due to their failure to provide evidence that they have completed refresher training. Nothing whatever to do with occasional licences. And how ironic that this was published a week before the need for renewal of personal licences was abolished in England.

The recommendations relating to site only licences and surrenders beggar belief. Developers will be helped by “greater clarity within overprovision statements.” Well, no one applies for any new licence unless they have a fighting chance of being successful, but why have to spend tens of thousands on plans at the outset? Anyway, the committee continues, a decision might be made not to proceed. “They could hold these types of licenses (sic) for a considerable period before trading commences.” But no one suggested that a site only provisional should last for longer than a standard provisional. Flawed reasoning. But not as flawed as the comments on surrenders. “We have heard no evidence to convince us that businesses should be able to avoid current regulations designed for safety or other reasons through this method.” No, but you heard lots of evidence on the impact on landlords whose tenants surrender a licence through spite, and you have completely ignored this. My next blog will cover the issues of occasional licences, public entertainment and the implications of a sixth licensing objective, but one final comment on the shoddy nature of this report.

 It is recommended that “club licenses and occasional licenses” (again, their horrible spelling, not mine) require to be considered by boards in their overprovision statements. There is no such beast as a club licence – clubs, like everyone else, hold premises licences.  Licensed premises are defined in section 147 of the 2005 Act as premises in respect of which a premises licence or occasional licence has effect. What change is proposed? Is there to be a cap on the number of occasional licences. If so, you can predict the anomalies. Will the Royal Highland Show be affected? Or Braemar Highland Games. Or is the overprovision policy simply to be based on the number of occasionals in force at the time of its publication?

Whether or not you agree with any or all of the proposed reforms, Scotland is entitled to much better quality than this.

CONSULTATION ON THE AIR WEAPONS AND LICENSING BILL: Why Did We Bother?

“The government I lead intends to be open, listening, and available in a way we have not seen before – the most open and accessible government that Scotland has had.”

First Minister Nicola Sturgeon

A few days ago I delivered my quarterly column on liquor licensing to the Editor of the Journal of the Law Society of Scotland. I anticipate it will appear in the April issue. In it I analysed some aspects of the response to the consultation on the Air Weapons and Licensing (Scotland) Bill, currently being considered by the Local Government and Regeneration Committee at Holyrood. In a manner which many would consider to be out of character on my part, I expressed sympathy with the legislators, with particular reference to the quality of some of the responses. Having read the Stage 1 report, which was published on 23 March, I now formally withdraw that. Their weasel words, duplicity and flagrant misrepresentation of facts would win universal approval, not only from Sir Humphrey Appleby of Yes Minister fame, but also from snake oil salesmen the world over.

The major issues which most of us in the profession had on the proposed reforms to liquor licensing were not with what was in the Bill, but with what was omitted. The Law Society’s licensing sub-committee took the view that our responses should be restricted to a few non-political points which caused problems in day to day practice. (Note that while I anticipate many of my fellow committee members may agree with what I write, these are my personal views.)

We concentrated on three main issues; site only provisional licences, surrenders and transfers. The problems which we highlighted are issues which do not arise under the English Licensing Act. While that too has its faults, all of the practical problems which we in Scotland face have a solution within the Licensing Act 2003. Many of these points were also raised by other groups such the Institute of Licensing.

The issue of site only licences is a simple one. It is wasteful to have to go to the expense of lodging incredibly detailed plans for a building which may have nothing more than outline planning permission, in the near certain knowledge that a major variation of the licence with further expensive plans will ultimately be required if the licence is granted. This was explained to the committee by various parties. In addition to the cogent evidence, it was not unreasonable to assume that the committee would have expert legal guidance, given by someone au fait with the current legislation. So it was more than a little disconcerting to read that “the 2005 Act does not allow for provisional licences where premises are yet to be built or under construction.” Well, in my copy it does, and I’ve obtained a fair few in my time. How did the committee react? The Scottish Government was asked for its comments. Its response? They indicated the proposal had the potential to undermine facets of the existing regime. They considered they (sic) would not be widely supported by others. The old section 26(2) provisional grant did have its critics who felt that a licence could be obtained with too little information being given, but that was in the days before operating plans. We are not told what facets of the existing regime would be under threat.

On the issue of surrenders the committee clearly got the point. They seemed to have accepted that there are numerous examples where a licence is surrendered out of spite, putting a landlord in the invidious position of owning premises which have no licence. Even if a new licence can be obtained the cost, including loss of rent, can easily run into tens of thousands of pounds. The committee, however, seemed to focus on only one disadvantage, namely the situation where an older property might not comply with current regulations and the owner might struggle to obtain a new licence. Never mind the 99% of cases where there will be no such problem. Again the Scottish Government was asked for its views. The response? The proposal had the potential to undermine facets of the existing regime. They considered the proposal would not be widely supported by others. Sound familiar? As there is a procedure under the English legislation for resuscitating a surrendered licence, one might have expected any evidence of such problems to be readily available. Who are these mythical “others” who might be offended?

Finally, the appalling mess of the present transfer system was fully explained to the committee. The detail of all of the problems is clearly set out in the report. Bear in mind that these are issues which the Law Society and other commentators have been making for over a decade, since the 2005 Act was a Bill, and in the run up to the two pieces of amending legislation. The current flaws see the law being bent or broken every week by practitioners desperately trying to make commercial sense. In cross border deals we face the embarrassment of having to explain to lawyers in England and Wales why we have a serious problem which they do not. Once again the committee sent a memo down to New St Andrews House. A different reply from the government this time. The report states, We asked the Scottish Government for their views on teach (sic) of the above issues and they said they “continued to consider the concerns raised”. Does that fill anyone with hope that something will find its way into the Bill? No, me neither.

The fact is that none of the issues raised was in any way political. Any genuine concerns by “others” could easily be addressed. The truth is that this consultation seems to have been a sham. The licensed trade deserves better than this badly written and ill checked piece of work. (The word licence is spelled license no fewer than 19 times.) This report is a shoddy piece of work by lazy legislators who give not a fig for anyone else’s agenda.

LICENSING: THE APPLIANCE OF SCIENCE?  

It is difficult, if not impossible, to argue against the scientific evidence behind the Scottish Government’s decision to lower the drink driving limits. With effect from 5 December 2014, the maximum limit is 22 microgrammes of alcohol in 100 millilitres of breath (reduced from 35). Expressed in blood alcohol content (BAC) figures, which are more commonly used in scientific papers, the limit is 50 milligrams of alcohol per 100 millilitres of blood (0.05%), reduced from 80 milligrams. Initial tests, at roadside and in police stations, are measured using the breath test, followed up by a more accurate analysis based on a sample of blood or urine. This looks like a reduction of 37%; however, with the old limits the Crown Office had directed that no one should be prosecuted with a breath reading below 40. That leeway will no longer be applied, meaning that the actual reduction is one of about 50%.

Drink driving convictions in Scotland fell from 11,871 in 1980 to 5281 in 2011. That is still a very high figure, and one can only speculate at the numbers of drivers whose breach of the law goes undetected. Supporters of the change pointed out that the UK is one of the few countries in Europe with the BAC at 0.08% as opposed to 0.05%. More relevantly there is clear scientific research showing that even with a BAC as low as 0.02% one’s judgment is slightly impaired, with a decline in visual functions and a decline in the ability to multi task. At 0.05% there is reduced coordination and a lowering of inhibitions. This can encourage a more reckless style of driving and reduced response times in emergency situations. Science supports the change.

But where science is irrelevant is in the imposition of penalty, which will remain a mandatory 12 month ban. This apparently is not a devolved matter. A BAC of 0.05% will get you a one month ban in Germany and 6 penalty points in France, with suspension optional. The statisticians do not tell us how many accidents there have been where the driver has been recorded with a smaller, but legal, amount of alcohol. Undoubtedly there will be some hard cases where people are caught out the next morning. It is unfortunate that a degree of proportionality in sentencing was not brought in at the same time.

Scientists have also been busy in the overprovision debate. This article is written in the week where an existing Sainsbury’s store in Edinburgh was refused permission to add two extra chill cabinets to its existing alcohol display. This is a topic close to the heart of the health lobby. October saw the publication of a report entitled Alcohol-related illness and death in Scottish neighbourhoods: is there a relationship with the number of alcohol outlets? Commissioned by Alcohol Focus Scotland it was produced by CRESH, Centres for Research on Environment, Society and Health in Edinburgh and Glasgow. It is a very short report, extending to ten pages plus seven pages of appendices. It concludes that there are large variations in numbers of alcohol outlets in Scotland. It has two other key messages. These are, (1) Across the whole of Scotland, neighbourhoods with higher numbers of alcohol outlets had significantly higher alcohol-related death rates, and (2) Across the whole of Scotland, alcohol-related hospitalisation rates were significantly higher in neighbourhoods with the most alcohol outlets.

There are dangers, however, in relying solely on an executive summary. Criticism of such surveys in the past has been that causal links have not been established. If one delves into the detail of the CRESH report, one sees that this remains the case. The authors concede, our outlet availability measures were a relatively crude way of measuring the actual availability of alcohol in a neighbourhood. We should caution that our study was cross-sectional – it looked at a single point in time – hence while it suggested significant associations between outlet availability and alcohol-related harm we cannot conclude that the relationship is causal. Further analyses over time will be required to establish whether the links are causal, but currently alcohol outlet data for Scotland are only available for a single point in time.

 This is a debate to be continued.

Old Johnston’s Almanack 2015

Taking stock at this time of year is fine: however, those of us with the second sight look ahead. Old Johnston does not like what he sees.

On the business side, the future for the licensed trade is, despite the economic upturn, horribly bleak. Small pubs will continue to feel the pinch, much as small independent shops disappeared from our high streets in the 1970s and 80s. The new drink driving limit will hasten the process across the board. Guys who would go for two pints after work on a Friday will say, what is the point of one drink, and abandon the pub altogether. Those who, sensibly, turned to food as a source of profit will see the couple who split a bottle of wine change their ways or stop coming out altogether. Golf clubs, already encountering a storm of recession and apathy among the young, will see that storm perfected  by the new law. A month into the new regime, clubs are reporting a downturn in drink sales of a staggering 70%. Rub your hands, developers, there will be a lot more land available in a couple of years. Oh MSPs, did you consider this, or is it to be one more of your unintended consequences?

We will have new legislation, yet again. Will the final version be good, bad or merely indifferent?

I predict a complete mess on the subject of sexual entertainment venues. To be a servant of twa masters is hard enough: to be regulated by two different authorities is the stuff of nightmares. When the country’s two major cities, just 40 miles apart, have diametrically opposed views, who knows where it will end? One thing is certain – House’s Strathclyde based, jackbooted views will be felt across the land. Where are the checks and balance for the police now?

I really don’t care about the reintroduction of the fit and proper test, but I do care that the fundamental weaknesses of the 2005 Act have been ignored. The transfer problems have been highlighted since the 2005 Act was a bill. It is scandalous that they have been overlooked yet again. It seems that our lawmakers are completely oblivious to the interests of landlords. Not only do they provide no safeguards against surrender of a licence by a disaffected tenant, they are about to provide for an automatic revocation if that tenant is deemed to be no longer a “fit and proper person” to hold that licence. Yet the regime is such that a landlord cannot possibly comply with the statutory requirements if he holds the licence in his own name: indeed, he risks prosecution.

Many of will have been pleased to see the back of Kenny Macaskill, but it remains to be seen if his successor will grasp the issues, never mind the nettle.

One very positive feature of the last few years has been the rise in standards of licensing boards. I hope that will continue; however, where there is change there is chaos. Excellent opportunities for licensing lawyers, but uncertainty and stress for boards and the overworked clerks who have to try to keep them right.

2014 saw many operators hanging on by their fingertips. I fear that in many cases the grip will be lost altogether. My final hope is that Old Johnston is proved to have been hopelessly wrong. Hope for the best – but fear the worst. Happy 2015

Brighton Has Rock: Dundee Has Humbug

In a recent edition of Scottish Licensed Trade News  veteran of the trade Jimmy Marr accused Dundee licensing board of “killing clubs” by the policies it introduced last year. Until fairly recently in Dundee, pubs closed at midnight, clubs at 0230. The policy change saw pubs able to open until 0100 on Fridays and Saturdays, with clubs enjoying a terminal hour of 0300. The problem has arisen because of the board’s new policy relating to “hybrid premises”. These are premises which provide “substantial entertainment”. If they pass that test, they can open until 0200. Furthermore the local casino is licensed until 0600. The impact on the club trade is devastating.

Marr cites the example of Fat Sam’s, one of the city’s best known nightclubs. With a capacity of 2000, it used to open seven nights a week: it now opens for four hours. Marr’s own club, Deja Vu, opens only two nights a week. He predicts that in a short time there will be no nightclubs left in Dundee. If that is what the city fathers wish, then so be it; however, their reported response suggests that once again it is an example of politicians failing to learn the lessons of history. I have been witness to this daft experimentation a number of times over the years, most notably in West Lothian and Dunfermline. Nightclubs have their name for a reason. Their design and décor render them unsuitable for normal daytime use. Even the most sophisticated of clubs looks out of place when the sun is shining outside. To cater for the fickle youth market, they require regular updating and refurbishment to keep them looking different. That is an expensive business, and is difficult to do without the additional revenue from door charges. Experience has shown that customers simply will not pay an admission charge if all that is on offer is an additional one hour of trading beyond other licensed premises. If the current status quo remains in Dundee, it is likely that Marr’s gloomy predictions will indeed come to pass.

It would be interesting to know the reason for the board’s change of policy. Did the board members understand the implications for the nightclub trade? Or were they simply ignorant of the inevitable consequences of their actions? In the SLTN, board convenor David Bowes, astonishingly, expressed sympathy. He is quoted as saying, “I feel for what Mr Marr is saying. It is unfortunate but we can’t take commercial issues into consideration when we are considering licence applications. We’re just not allowed to.” (My emphasis). Indeed, Mr Bowes, but it is your own policy which you are implementing, not anyone else’s. If you are so unhappy with it that you feel you have to apologise to one of your city’s most experienced and respected operators, then do something about it. Review that policy. If you won’t, then look Mr Marr in the eye and tell him why you won’t, but please, please don’t try to blame someone else.

When Does A Licence “Cease To Be Used”?

When I penned my undistinguished pamphlet, How Not to Lose Your Licence, some years ago, I thought I was fairly clear in the various ways a licence could meet its end. Some of these would clearly involve injustice, especially with the arbitrary time limits applied. Five years and two reform acts later these injustices still apply, and it is a scandal that no steps are proposed to remedy them, and that many owners of licensed premises have had to rely on  the good will of Scotland’s excellent clerks to secure that this most precious of possessions is still intact. But this article is not about death or insolvency or dissolution of corporate bodies.

To my surprise, section 28(5)(b) of the 2005 Act has come into prominence quite a bit of late. That section provides that a premises licence ceases to have effect where the premises “cease to be used for the sale of alcohol.” With the downturn in the economy, which has hit the licensed trade very hard indeed, there are currently numerous pub and hotel buildings lying empty. I have had many clients who have taken several years to find new occupiers, but have kept the licences alive and paid the annual fees. I now hear of more and more cases where licensing boards are trying to deem that these licences have “ceased to have effect”, in some cases without even a hearing. I have no doubt that this is a misapplication of that section and, in the absence of a hearing, the most flagrant breach of natural justice.

 This is a new provision for liquor licensing. Possibly the draftsman was influenced by a betting case in Dundee, where an objector to a new betting office licence sought to pray in aid the fact that that objector (who had vacated the premises) held a betting office licence, ex facie in force, in respect of the same premises. (Bear in mind that it was not possible to transfer a betting office licence.) The court held that that licence must be deemed to have ceased to have effect by virtue of the objector’s having ceased to have any right to occupy the premises.

If one does not look to external factors, it is hard to make a sensible analysis of the subsection. Every set of licensed premises ceases to be used for the sale of alcohol between closing time and the next opening time. A fortiori if the licensee shuts for a holiday or because of illness. And what if the premises close for a few weeks for refurbishment? No one, surely, would argue that the licence terminates in such circumstances. What, then, is the difference if the premises are closed for a time because of economic factors? Had Parliament intended to impose a cut off time, it could easily have done so. It seems clear therefore that external factors must be considered. Remember, we are considering only those premises which are closed and where someone has elected to pay the annual renewal fee. Most licensing boards will eventually revoke a licence for non-payment of fees. Payment being made clearly evidences a desire to preserve the licence. Might it be argued that a licensing board which accepts an annual payment is personally barred from revoking it in terms of section 28(5)(b)? It should also be remembered that in terms of human rights legislation, a licence is a “possession” with various important enshrined protections. It is a very valuable possession. The value of empty licensed premises with the benefit of a premises licence may be many fold the bricks and mortar value. Any licensing board making threats might be reminded of the size of the damages claim which may await.

In summary, we have another piece of badly drafted legislation coming into focus. In construing it, I believe there should be some analysis done first, and preference given to that analysis which makes sense. All legislation these days has to be “human rights compliant” Let us assume that the government didn’t make that fundamental error, and leave the last word to Jack Cummins in his commentary. Exhorting an interpretation which avoids uncertainty, he concludes, “it may therefore be considered that this subsection only applies where licensed premises have de facto been converted to another use.”

This article first appeared in the October issue of The Journal of the Law Society of Scotland