Legal advice: Stress area ruling blow

High Court decides that bids to vary opening hours are subject to 'cumulative impact' zone policies.

By Piers Warne of thePublican.com's team of legal experts from London solicitors Joelson Wilson.​

The High Court has ruled that applications for the variation of hours will be subject to "cumulative impact" policies. The decision is a blow to operators who were hoping that bids to extend hours in areas designated as "stress areas" would be considered outside the scope of such policies.

Cumulative impact zones (or stress areas) are zones where the licensing authority considers the number and type of premises in that area have a negative impact. Once a zone is designated a stress area the burden of proof is on those applying for new licences or "material variations" — they have to show that their application will not add to the cumulative impact on the area. For applications outside stress areas, the burden is on a person making a representation to show that the application will be likely to undermine the licensing objectives.

JD Wetherspoon, which brought the case discussed, sought to argue that a licensing committee could not base a decision on variation of hours on its cumulative impact. The argument was that to classify a variation of hours as a "material variation" would be counter to the main purpose of the Act, which is to prevent artificial closing times leading to large numbers of people leaving premises at the same time.

Material factor​

The counter-argument relied upon by Guildford licensing committee was that the guidance did not specifically exclude variation of hours from engaging the stress area policy and that it could be a material factor in contributing to cumulative impact. In addition, a cumulative impact policy would not prevent an applicant having his case considered on its merits and therefore would not prevent the later opening of premises. The issue central to the case was whether cumulative impact would reverse the burden of proof from parties making representations to the party making the application if the variation only sought to extend hours. The court ruled that it did.

However, the court was clear that where there is no cumulative impact policy, the emphasis of the guidance is on promoting longer hours to prevent movement of large numbers of people at artificially early closing times. The council had sought to argue that the Act and the guidance were "neutral" in terms of promoting longer hours. The upshot is that, for applications to extend hours for premises not subject to a cumulative impact zone, there should be a presumption that longer hours will assist in the promotion of the licensing objectives. Therefore, anyone making a representation to the application will have to show the contrary.

The judgment confines itself to dealing with cumulative impact policies and restricts itself to reversing the burden of proof. Applicants still have the opportunity to show that the variation (or new licence application) would not have the likely effect of undermining one or more of the licensing objectives. Should a licensing policy go further than this and try to enforce a higher burden on applicants in proving their case, this may be open to a separate challenge. The judgment makes it clear that the merits of each application have to be considered before an application is rejected on the basis of cumulative impact.

In the case before the court, the committee was entitled to rely on its cumulative impact policy and the applicant failed to satisfy the committee that the measures in place or put forward in the operating schedule would prevent any undermining of the crime prevention objective. The committee was therefore entitled to reject the application.

Much-needed guidance​

The decision clarifies the extent to which cumulative impact policies can be relied upon and gives applicants much-needed guidance as to what hurdles they will have to overcome if making an application for a new licence or for a major variation in a stress area. Firstly, an application to vary hours will be considered to be subject to the stress area policy if a relevant representation is received. Secondly, the burden of proof will be on the applicant to show that there will be no adverse effect on licensing objectives. Thirdly, if the committee is satisfied that the applicant has not complied with the above, then it is entitled to reject the application.

Fourthly, applicants run the risk that the licensing authority will find that an increase in trading hours will act as a magnet, bringing people into an area to drink and hence engaging the cumulative impact policy, an approach adopted by Guildford and upheld by the judge.

On the plus side, if your premises is outside a stress area, you are entitled to rely on the fact that the guidance promotes longer hours as an effective way of promoting the licensing objectives.

The decision gives guidance on what hurdles may have to be overcome if making an application for a variation of hours within a stress area.