GLASGOW CITY COUNCIL AGAINST VICENTE BIMENDI UNDER THE CIVIC GOVERNMENT (SCOTLAND) ACT 1982, SCHEDULE 1, PARAGRAPH 18(12)
EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
[2016] CSIH 41
XA82/15
Lady Paton
Lord Drummond Young
Lord McGhie
OPINION OF THE COURT
delivered by LADY PATON
in the appeal
by
GLASGOW CITY COUNCIL
Appellants;
against
VICENTE BIMENDI
Respondent:
under
The Civic Government (Scotland) Act 1982, Schedule 1, paragraph 18(12)
Appellants: Blair; Glasgow City Council
Respondent: Hajducki QC; John Mair Solicitors Ltd t/a Campbell Mair, Glasgow
8 June 2016
Application for renewal of a taxi booking office licence
[1] Since 2009, a licence has been required not only to operate as a taxi driver, but also to run a taxi booking office (The Civic Government (Scotland) Act 1982 (Licensing of Booking Offices) Order 2009 (SSI 2009/145)). Article 3 of that Order incorporates a system of mandatory conditions contained in part I of the 1982 Act.
[2] In terms of paragraph 5(3)(a)(ii) of Schedule 1 to the Civic Government (Scotland) Act 1982, a licensing authority:
“ … shall refuse an application to grant or renew a licence if, in their opinion –
- the applicant or, where the applicant is not a natural person, any director of it or partner in it or any other person responsible for its management, is …
(ii) not a fit and proper person to be the holder of the licence …“
[3] On 19 June 2014, the respondent applied to Glasgow City Council (the appellants, hereinafter “the Council”) for renewal of a licence for a taxi booking office situated at 1552 Great Western Road, Glasgow.
[4] The Chief Constable lodged an objection based on the respondent’s conduct in another licensing area, namely East Dunbartonshire. In particular, by letter dated 9 July 2014, the objection (read short) was as follows:
- The respondent was a director of a limited company, Milngavie & Bearsden Station Taxis Ltd, 8-10 Station Road, Bearsden (“MBST”).MBST had a licence to operate within East Dunbartonshire council area.Nevertheless taxi drivers working for MBST regularly breached that licence by conveying customers on journeys beginning and ending outwith East Dunbartonshire (contrary to section 21 of the Civic Government (Scotland) Act 1982, quoted in paragraph [6] below).Reference was made to journeys recorded in computerised records for 21‑22 February 2013, and the fact that 43% of those journeys began and ended outwith the East Dunbartonshire area.
- Furthermore, the limited company MBST had been dissolved on 19 October 2010.When East Dunbartonshire Council became aware of that fact, they served a letter on MBST on 8 July 2013, requiring them to cease trading with immediate effect.Subsequent police investigations on 9 July 2013 and 2 September 2013 established that MBST was continuing to trade in defiance of the letter.Police visiting the office at 8‑10 Station Road found staff uncooperative and uncommunicative.MBST was restored to the register on 27 July 2013.
[5] In the penultimate paragraph of the letter of 9 July 2014, it was submitted that the conduct of the respondent displayed:
“ … a complete disregard for licensing legislation and the duty of licence holders to adhere to conditions attached to any licence. The [respondent]’s course of conduct, and that of the business of which he is a director, raise major concerns that he is unable to abide by legislation regulating the conduct of taxi drivers and booking offices, and that he is not a fit and proper person to hold a taxi operators licence.”
Section 21 of the Civic Government (Scotland) Act 1982
[6] The Civic Government (Scotland) Act 1982 provides inter alia:
“Section 21 – Offences
- If any person –
- operates, or permits the operation of, a taxi within an area in respect of which its operation requires to be but is not licensed or the driver requires to be but is not licensed, or
- picks up passengers in, or permits passengers to be picked up by, a private hire car within an area in respect of which its operation requires to be but is not licensed or the driver requires to be but is not licensed,
that person shall be guilty of an offence and liable, on summary conviction to a fine …
- Subsection (1) above does not apply to the operation of a taxi or private hire car within an area in respect of which its operation or its driver is not licensed if the request for its hiring was received by its driver (otherwise than in a public place from the person to be conveyed in it, or a person acting on his behalf, for a journey beginning there and then) whilst –
- in the area or in that part thereof in respect of which its operation and its driver are licensed;
- engaged on hire on a journey which began in that area or part or will end there;or
- returning to that area or part immediately following completion of a journey on hire …”
The licensing committee
[7] On 26 November 2014, the respondent’s contested application came before the Council’s Licensing and Regulatory Committee (“the committee”). The respondent was represented by Mr Campbell, solicitor. The objectors (the police) were represented by Chief Inspector Sloan, Sergeant Ryan Curran, and Detective Constable Stewart Mathieson.
[8] Chief Inspector Sloan, Sergeant Curran, and the respondent’s solicitor addressed the committee, gave evidence, answered questions, and made submissions. The respondent also addressed the committee and answered questions (Appendix pages 121; 124 to 133; 136 to 138; 140 to 141).
[9] The committee ultimately refused the respondent’s application. By e-mail dated 27 November 2014 the respondent’s solicitor requested a statement of reasons.
[10] By letter dated 15 January 2015, reasons were given, as follows:
“Dissolution of Milngavie Taxis
… The Committee noted Mr Campbell’s submissions in relation to company law and ongoing court cases. However the Committee was of the view that the company’s restoration to the register could not be relied upon by your client as a point in his favour. At the time of its dissolution your client must have known that his company had been dissolved and the licence held by that company ceased to exist: the fact the company was later restored to the Register does not alter the fact that your client knew he was operating a booking office with a licence belonging to a company that did not exist for approximately 2 years and 9 months.
Mr Bimendi’s actions, as narrated above, demonstrated a disregard for lawful authority and therefore constituted a weakness in character. The Committee formed the view that an experienced licence holder such as Mr Bimendi would have known that a licence held by a corporate entity would have terminated with the dissolution of that entity and despite this, continued to trade. Mr Bimendi knowingly and wilfully traded without a licence of the type required for the activity he was engaged in. Accordingly in respect of the matters outlined in this section, the Committee resolved to refuse your client’s renewal application in terms of paragraph 5(3)(a)(ii) of Schedule 1 to the above Act, i.e. on the grounds that your client is not a fit and proper person to be the holder of a Booking Office Licence.
Section 21 of the 1982 Act
…The Committee does not dispute that a private hire car driver may utilise an exception under [section 21] of the 1982 Act and this is entirely legitimate. However, the Committee noted that the submission by the Chief Constable’s representative that between 21 and 22 February 2013, 43% of journeys commenced and terminated outwith the East Dunbartonshire Council area. Mr Campbell did not dispute the accuracy of these figures. The Committee found it incredible to suggest that all of these journeys involved drivers who were able to rely upon one of the above exceptions. In coming to this view, the Committee noted that for exception (c) to apply, the driver must have been ‘immediately’ returning to his own area. Therefore the Committee formed the view that it was improbable that private hire car drivers could be relying upon this exception in 43% of the bookings. The Committee found that Mr Bimendi’s booking office regularly dispatched private hire cars to pick up passengers within an area for which they held no licence in a manner which would be contrary to section 21 of the 1982 Act. The Committee further found that this activity was permitted by the booking office. In reminding itself of … section 21 of the 1982 Act the Committee did not seek to usurp the position of the Criminal Courts by purporting to find that a criminal offence had been committed. The Committee was aware that your client had not been convicted of any breaches of section 21 of the 1982 Act. However, the Committee was of the view that the material before it allowed it to conclude, on the balance of probabilities, that Mr Bimendi’s East Dunbartonshire Booking Office permitted private hire car drivers to operate outwith East Dunbartonshire and in Glasgow, an area for which they are unlicensed. The Committee were not satisfied that the number of journeys both starting and ending outwith East Dunbartonshire could be explained by reference to the exceptions …
The Committee is of the view that the intent of the legislation here is to ensure that Private Hire Car drivers operate within the area for which they are licensed … unless one of three specific exceptions [is] met. Public safety is of paramount [importance] in a licensing regime and licensing authorities should be able to assume that private hire car drivers operating in their area are subject to their conditions and have had their applications determined by it.
Given that it was not disputed that Mr Bimendi was aware of the practices of the drivers operating from the East Dunbartonshire Booking Office, the Committee concluded that Mr Bimendi was aware that drivers were acting contrary to the provisions of the 1982 Act and that this booking office facilitated this behaviour. The Committee was of the view that as an experienced licence holder Mr Bimendi should have taken steps to prevent drivers being routinely sent to collect fares outwith their licensed area when they could not rely upon [one] of the exceptions set out in the 1982 Act. Instead it appeared to the Committee that the East Dunbartonshire Booking Office was regularly sending East Dunbartonshire licensed drivers to pick up and drop [off] customers within Glasgow, i.e. inter Glasgow journeys. This demonstrated a willingness on the part of your client to flout the law and disregard issues relating to public safety. In addition, the Committee again noted Mr Bimendi’s statements in respect of ’freedom of choice’ and this supported the Committee’s view that Mr Bimendi was operating with little or no regard for the law – the 1982 Act does not recognise the concept of ‘freedom of choice’, instead Parliament has legislated for three specific exceptions. Accordingly in respect of this section, the Committee resolved to separately refuse your client’s renewal application in terms of paragraph 5(3)(a)(ii) of Schedule 1 to the above Act, i.e. on the grounds that your client is not a fit and proper person to be the holder of a Booking Office Licence.
Decision
In determining to refuse the application in terms of paragraph 5(3)(a)(ii) of Schedule 1 to the above Act, the Committee was of the view that, taking into account all that was said at the meeting on 26 November 2014 … its findings in respect of the two above grounds, (i) section 21 of the 1982 Act; and (ii) dissolution of Milngavie Taxis, both grounds separately and cumulatively indicated that your client was not a fit and proper person to be the holder of the above Licence. Therefore the renewal of such a Licence was refused in terms of paragraph 5(3)(a)(ii) of the 1982 Act …”
The sheriff court
[11] The respondent appealed to the sheriff court. By decision dated 13 July 2015, Sheriff Ian Anderson allowed the appeal and remitted the application to the Council for reconsideration.
[12] The sheriff’s judgment included the following passages:
”7. In relation to the dissolution of the company the Committee concluded (bottom of page 3 and top of page 4) that the Appellant ‘knew he was operating a booking office with a licence belonging to a company that did not exist for approximately 2 years and 9 months.’ and that this demonstrated ‘a disregard for lawful authority’. The Committee further concluded that the appellant had knowingly traded without a licence. There was no evidence to those effects before the Committee and there was no basis on which those conclusions could have been inferred from the evidence before the Committee. The opposite would appear more likely that the Appellant had not known the company had been dissolved and had no licence. On proper examination it might yet appear that the circumstances in which the company was dissolved would allow the Committee to draw a conclusion that the appellant was not fit to have a licence but the Committee would have to have a sound basis for that decision which was lacking here. The Committee did not address the relevant police submission that the company had kept on trading after being told to stop. That might be said to be covered by the general finding but if so it is not possible to work out how much weight was put on that circumstance and, in any event, the Committee did not ask about that.
8. The Committee decision on the dissolution and licence issue was erroneous in law and also represented an unreasonable exercise of the Committee’s discretion and should be remitted for reconsideration.
9. The Committee accepted that the exceptions to section 21 permitted a driver to be instructed by a booking office in the circumstances set out in the exceptions. They contemplate either that the driver was actually engaged on a journey which started or would end … within the East Dunbartonshire Council area - section 21(2)(a) - or that he had just finished a journey and was immediately returning to the East Dunbartonshire Council area - section 21(2)(b). Those exceptions do not say that the new journey has to start or finish in the East Dunbartonshire Council area. The Committee noted the police submission that 43% of the company’s journeys commenced and terminated outside the East Dunbartonshire Council area between 21 and 22 February (top of page 5). That was not actually what the police had submitted because only 8 pages were looked at but the Committee would have been entitled to conclude that the % was likely to be the same in the absence of submissions to the contrary. The Committee concluded that the exceptions could not explain this proportion of out of area journeys. A Committee is entitled to rely on its local knowledge and the court would be slow to interfere with that but two considerations arise in this case. Firstly it has to be clear that the Committee has local knowledge. In this case the Committee reached conclusions about local conditions in another licensing area. It may be that the Committee would know that Glasgow and East Dunbartonshire could be treated as the same but if so that should have been explained. Secondly if the Committee is using local knowledge it must be clear what background knowledge they have invoked and that was not done in this case. Risky Business v City of Glasgow Licensing Board 2000 S.L.T. 923. The Committee erred in failing to identify its local knowledge and therefore failed to explain its reasons. It exercised its discretion unreasonably and its decision on this issue should be remitted for reconsideration.”
The Court of Session
[13] The Council appealed to the Court of Session on the basis that the sheriff had erred in law (paragraph 18(12) of Schedule 1 to the Civic Government (Scotland) Act 1982).
Submissions for the Council
[14] The committee had a broad discretion. They were entitled to give weight to the nature and cumulative impression of a series of circumstances. It was not necessary that the respondent had been convicted of an offence. Only where a licensing authority’s exercise of judgment was so unreasonable that no reasonable authority could have reached the decision, should a court intervene. Reference was made to Coyle v Glasgow City Council 2012 SLT 1018; McKay v Banff and Buchan Western Division Licensing Board 1991 SLT 20, at page 24 G-H; J & E (Glasgow) Ltd v City of Glasgow District Licensing Board 1994 SC 290, at pages 296H, 297B to 298A, 301I to 302C; Hughes v Hamilton District Council 1991 SC 251.
[15] Standing the terms of the Chief Constable’s objection dated 9 July 2014 (prima facie raising significant concerns), there was a practical onus on the respondent to deal with the points made and to provide explanations, supported if necessary by relevant material (Chief Constable of Strathclyde v North Lanarkshire Licensing Board 2004 SC 304 at paragraph 23; McAllister v East Dunbartonshire Licensing Board 1998 SC 748 at page 757G-H; Calderwood v Renfrewshire Council 2004 SC 691 at paragraph 18). The sheriff had failed to have regard to that practical onus.
[16] In relation to the dissolution of the company, the sheriff erred in law in two respects. First, he failed to address the question of practical onus, on the contrary making a presumption in favour of the respondent (i.e. that it was “more likely that the [respondent] had not known the company had been dissolved and had no licence”: paragraph 7 of his decision). Secondly, the sheriff substituted his own view of the material available. The case relied upon by the respondent (Beauchamp Pizza Limited v Coventry City Council [2010] EWHC 926 (Ch)) concerned the restoration of assets, whereas the present case concerned the conduct of the licence‑holder. It was not for the committee to search for an answer to unsatisfactory conduct, a fortiori where the respondent was both legally represented and given an opportunity to speak.
[17] In relation to breaches of section 21, the sheriff erred in law by taking the view that the committee had relied on local knowledge. They had not: they had relied on the documentary productions and the information provided by Chief Inspector Sloan (for example, Appendix pages 59 to 60). The evidence relating to 43% had not been challenged in cross‑examination. It was a significant percentage, calling out for an explanation. There was an onus on the respondent to explain how it came about that 43% of the journeys in one day (21-22 February 2013) started and ended in Glasgow, when the taxi operator was licensed for East Dunbartonshire.
[18] In conclusion, the committee had been entitled to find that the respondent was not a fit and proper person to be the holder of the licence in terms of paragraph 5(3)(a)(ii) of Schedule 1 to the 1982 Act. The sheriff’s decision should be recalled and the committee’s decision restored.
Submissions for the respondent
[19] Senior counsel invited the court to uphold the sheriff’s decision.
[20] In relation to breaches of section 21, it was accepted that a practical onus might arise if sufficient relevant material was placed before the committee. But there was insufficient material in this case. No‑one knew whether any particular journey fell within the exemptions in section 21(2). Individual journeys had not been put to either the respondent or his solicitor. Following upon the committee’s decision, 55 charges based on breaches of section 21 were brought in court, but in each case the procurator fiscal accepted a “not guilty” plea.
[21] In the hearing in the sheriff court, the respondent had relied upon section 21(2)(c) (and not sub‑paragraphs (a) or (b)). There had been nothing in the records establishing where a taxi’s previous journey had been. Thus there was insufficient information for the committee to ascertain whether or not the exception in section 21(2)(c) applied. Nor was there any information about typical percentages to be expected in relation to the exceptions in paragraph 21(2).
[22] The committee seemed to expect the respondent to have gone through 400 entries in a very short space of time (i.e. from the date when he received the letter intimating the hearing about the objection, 30 October 2014, until 14 November 2014 when the hearing took place). It was not reasonable to expect the respondent to ask drivers where they had been in journeys which had been made more than a year previously.
[23] As the records did not show where the taxis were or whether they were returning from, for example, street hire, the committee appeared to have relied upon their local knowledge. But as was made clear in Risky Business Ltd v City of Glasgow Licensing Board 2000 SLT 923, if a committee were relying upon their local knowledge and experience in reaching a decision, that had to be clearly identified when explaining the reasons for their decision.
[24] In relation to the dissolution of the company, there was no suggestion in the evidence that the respondent had been aware that the company had been struck off. Once the matter was drawn to his attention, the respondent took immediate steps to restore the company to the register, and it was duly restored in 19 days. Authorities such as Beachamp Pizza Limited (particularly paragraph 28 et seq) were relevant. It was important for the committee to appreciate why the company was struck off. The explanation was given in the pleadings in the appeal to the sheriff court (appeal print page 14B-E) as follows:
“ …[The committee] failed to enquire as to the circumstances in which said removal from the register occurred and why the applicant failed to take any action before the matter was drawn to his attention by East Dunbartonshire Council’s legal department. In any event it was unreasonable to make such assumptions [viz that the respondent had ‘knowingly and wilfully traded without a licence after the company was removed from the register’] in all the circumstances without further enquiry of the applicant who was present at said meeting. Had they done so they would have realised that the applicant had been [undergoing medical treatment] and was unwell at the time of said dissolution, that all letters from the registrar were being sent to another family member and that the applicant was accordingly unaware of and unable to deal with said matter. Once he was aware of the dissolution he took steps to rectify the matter …”
[25] There was no suggestion that the striking-off had any effect on the assets of the company or the safety of the public, or that the business operation was affected from a licensing point of view. All that had occurred was an oversight. If the committee wished to consider that oversight properly, they had to have the relevant material before them.
[26] It was not the case that the sheriff had put his own interpretation on the evidence led. He had merely observed that there had been a failure to supply adequate information. The respondent gave no explanation because he was never asked. It was necessary for the committee to raise the question of the company’s being off the register, and to request an explanation.
[27] The court was invited to refuse the appeal, and to remit the case to the committee with either a direction to grant the application, or a direction to hold a further hearing to ascertain the information required.
Discussion
[28] There are no provisions, either in statute or case‑law, limiting or defining the bases upon which a licensing authority may conclude that an applicant is not a “fit and proper person” to hold a licence. Such decisions are, of course, subject to the usual controls on administrative action: taking account of relevant considerations and avoiding irrelevant considerations; perversity; Wednesbury unreasonableness and the like. Beyond those controls, the authority enjoys a wide measure of discretion. It is not a necessary prerequisite that an applicant should have been convicted of a criminal offence (Coyle v Glasgow City Council 2012 SLT 1018). A licensing authority has a broad discretion when exercising their judgment. They are entitled to place weight on the nature and cumulative impression of a series of circumstances (McKay v Banff and Buchan Western Division Licensing Board 1991 SLT 20 at page 24G-H; Hughes v Hamilton District Council 1991 SC 251). They are also entitled to expect the applicant to provide information, explanations, or evidence in exculpation or mitigation of any alleged conduct or event which might suggest that he is not a fit and proper person. In this respect, there is a practical onus resting on the applicant (Chief Constable of Strathclyde v North Lanarkshire Licensing Board 2004 SC 304 at paragraph [23]; McAllister v East Dunbartonshire Licensing Board 1998 SC 748 at page 757G-H; Calderwood v Renfrewshire Council 2004 SC 691 at paragraph 18).
[29] In the present case, the Chief Constable’s objections were set out in the letter of 9 July 2014. It was for the respondent to provide the committee with information, and if necessary evidence, in response to those objections.
[30] We consider that the sheriff erred in law in that he failed to take into account the practical onus resting on the respondent, and further in that, despite the evidence before the committee (see below), he decided that the committee were not entitled, on the basis of that evidence, to exercise their judgment as they did. These errors were reflected in each of two central issues which were before the committee, as follows.
The dissolution of the company
[31] In paragraphs 7 and 8 of his opinion (set out in paragraph [12] above) the sheriff criticised the committee’s approach to the dissolution of the company on the basis that (i) there was no evidence that the respondent had knowingly traded without a licence (the opposite being more likely); (ii) the committee had not addressed the police submission that the company had kept on trading after being told to stop, and had not asked questions relating to that matter; (iii) the committee’s decision on the dissolution and licence issue was erroneous in law; and (iv) that the committee’s decision on that issue represented an unreasonable exercise of their discretion. We deal with each criticism in turn.
[32] The first matter relates to the issue of the practical onus resting upon the respondent (referred to in paragraph [28] above). Prima facie, continuing to trade on the basis of a licence granted to a company which no longer exists (having been struck off the register) is conduct which, in our view, a committee would be entitled to regard as irresponsible and without regard to the law. It was therefore for the respondent to provide an explanation in exculpation for that prima facie failure, supported by evidence if necessary (cf Chief Constable of Strathclyde v North Lanarkshire Licensing Board 2004 SC at paragraph 23). The respondent and his solicitor, when appearing before and addressing the committee, did not do so. In our opinion in those circumstances, the sheriff erred in law by adopting the speculative and exculpatory approach he did.
[33] In relation to the second matter, again it was for the respondent to provide any exculpatory or mitigatory information and/or evidence. The police officers’ evidence was to the effect that the respondent’s taxi office had continued to trade despite the company which held the licence having been struck off the register, and despite East Dunbartonshire Council’s letter dated 8 July 2013 requesting a cessation of trading with immediate effect for that reason. It was for the respondent to provide information and/or evidence in answer to the police evidence, thus rebutting the inference of wilful non‑compliance with the rules and regulations. The sheriff therefore erred in law by approaching the matter as if, despite the police evidence, no onus rested on the respondent.
[34] As for the third matter, it is our view that the sheriff erred in concluding that the committee’s decision was “erroneous in law”. While the restoration of a struck‑off company to the register may engage section 106(2) of the Companies Act 2006, and may result in a licence held by that company being deemed not to have lapsed by virtue of the dissolution (cf Beauchamp Pizza Limited v Coventry City Council [2010] EWHC 926 (Ch)), it does not follow that the committee are unable to take into account the fact that the respondent carried on trading during the period of 2 years 9 months when the company which held the licence was no longer on the register. Failure to notice that the company had been struck off during such a long period indicated an approach to business that was at least careless. On the evidence before them, the committee were entitled to take such conduct into account when considering whether the respondent was a fit and proper person to be the holder of a licence, and thus to reach the conclusion they did.
[35] Finally, it is our opinion that the sheriff erred in law in holding that the committee’s decision represented an unreasonable exercise of their discretion. We consider that, on the evidence before the committee, it could not be said that no licensing authority acting reasonably could have reached the conclusion they reached. As was said in Hughes v Hamilton District Council 1991 SC 251, at pages 256-7:
“ … Once there is relevant material before a licensing authority the question as to the weight to be attached to that material and the significance of any other balancing factors must before the authority to assess … [and the question was whether it could] possibly be said that no reasonable committee could have arrived at the view at which this committee arrived …”
We consider that, on the evidence, the committee were fully entitled to reach the view that the respondent’s conduct constituted significant non‑compliance with the law, and to conclude that the respondent was not a fit and proper person to be the holder of a licence.
Breaches of section 21
[36] In our opinion, it is clear from the transcript of evidence that the committee did not rely upon local knowledge. They relied upon the evidence (both oral and written) given by the police. A figure of 43% represented a significant number of the journeys made in one day, 21-22 February 2013, and the committee were entitled to ask for an explanation (which they did: Appendix page 125). In reply, the respondent did not give the committee any information or evidence which established an exception in terms of section 21(2). Rather he referred inter alia to “people’s freedom of choice” (Appendix page 128 lines 4-5), to the reliability of his taxi service (Appendix page 126 lines 4-5) and to his customers’ preference for that service (Appendix page 127 lines 17-20). What was required was an explanation, vouched as necessary, to explain the high percentage. That was not provided.
[37] We therefore consider that the sheriff erred in concluding that the committee relied upon local knowledge and did not identify what local knowledge they had used (thus failing properly to explain their reasons). The sheriff also erred in concluding that the committee had exercised their judgment unreasonably.
Decision
[38] For the reasons given above, we shall recall the sheriff’s decision, and restore the decision of the committee.