Legal Q&A: Drink driving, bankruptcy and CVAs

By Poppleston Allen

- Last updated on GMT

Drink driving and bankruptcy query: Will a drink driving conviction and having been declared bankrupt impact someone's ability to be a site's DPS?
Drink driving and bankruptcy query: Will a drink driving conviction and having been declared bankrupt impact someone's ability to be a site's DPS?
The latest legal Q&A from specialist licensing solicitors Poppleston Allen looks at the impact of bankruptcy and a drink driving conviction on employment as well as what options are on the table to manage a barren spell in business.

Drink-driving conviction and bankruptcy query

Q. I am the DPS of my local pub and I am currently having a difficult time because I have recently been convicted of drink driving and I am also about to be declared bankrupt.

I am worried about telling my employer but wondered if the conviction or the bankruptcy will affect my personal licence and therefore my ability to be the DPS of the pub.

I want to avoid telling my employer but don’t want to risk my job.

A​. You are very sensible to ask the question and first and foremost, your ability to hold a personal licence will not be affected by bankruptcy and, therefore, you may continue to be named as a DPS in that regard.

Both a court or licensing authority have the power to revoke or suspend your personal licence where there is a conviction for a relevant offence. You have a duty to declare to the court that you are a personal licence holder so that the court may notify the licensing authority which issued your personal licence, of the conviction.

As of 6 April 2017, the licensing authority has the power to revoke or suspend a personal licence (for up to six months) where it becomes aware the holder has been convicted of a relevant or foreign offence, or required to pay an immigration penalty.

The powers of the licensing authority are discretionary and if it is considering taking action against your personal licence, it will need to notify you in advance and allow you the opportunity to make representations against the revocation or suspension.

If the licensing authority decides not to revoke your personal licence, it is required to consult with the chief officer of police within the licensing authority’s area to allow the police to make representations upon whether the licence should be suspended or revoked to promote the prevention of crime and disorder.

You should also check the content of any employment contract as there may be a need for you to disclose the conviction or bankruptcy to your employer. 

Success has faded so measures must be taken 

Q. I operate a company that owns a chain of late-night bars, which has traded very successfully until the past 12 months.

The business has been having a difficult time with fewer customers and rising rents.

I am exploring ways to secure the company’s future with other directors and have been advised a company voluntary arrangement (CVA) would be the best option for us but that the other options available are administration or liquidation.

A​. Many operators are finding operating conditions challenging due to factors such as rising rents and an increase in the cost of wholesale food and drink.

As your premises licences are held by a company, the licences will lapse when the holder becomes insolvent regardless of whether this is as a result of a CVA, administration or liquidation.

The Licensing Act 2003 provides a period of 28 days within which a licence can be transferred or become the subject of an interim authority notice (for a period of up to three months) and be ‘resurrected’ following insolvency, to prevent the licence being lost on a permanent basis.

Therefore, whatever insolvency route you take, the licences will need to be transferred to an active company, or an interim authority notice given immediately when the insolvency takes place in order to ensure continuity of trade and that the licences are not permanently lost.

If you are entering into a CVA for a defined period, with the intention that the company will come out of it and trade normally at the end of that period, you will need to ensure the licences are transferred back from the temporary holding company to the original company once the CVA has been concluded.

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