The picture so far

Having extensively tested the attitude of Councils and Tribunals towards the listing of ACVs during 2016, we have found some mixed news for pub owners:

  • We have objected to 87 ACV nominations to date. Of those we have been successful in 59 instances, with only 28 nominations succeeding. This equates to a success rate of 68%.
  • At the ACV listing review stage, where the Council is reviewing its own decision to list the property in question, the story is different – with 19 pubs being de-listed out of 38 reviews that we have conducted, which equates to a 50% success rate. But this probably isn’t surprising given that Councils like to ratify the decisions that they have already reached.
  • However where we have succeeded at ACV listing review stage, we are now looking to recover the owners’ costs of the successful review. Councils have shown a willingness to pay these in some instances.
  • The First Tier Tribunal continues to be a difficult place for pub owners to win an Appeal, but there are signs that this is changing. In the appeal case of Hamna Wakaf Ltd –v- London Borough of Lambeth and Another
    [2016], we succeeded in:
  • Clarifying the law around hybrid nominations, with the FTT confirming that the St Gabriel case previously relied upon by CAMRA in vast swathes of so-called hybrid nominations had been wrong in some important respects (notably, the law!).
  • Obtaining judgment that the upper parts of the pub should not be listed, despite no planning permission being in place for conversion to self-contained accommodation.
  • The Upper Tribunal (equivalent to the High Court, in that it creates binding precedent) remains undiscovered territory for public houses. The only decided ACV appeal concerns a field, despite the very large number of ACV appeals concerning pubs. However one case, in which we obtained permission to appeal to the UT, was settled on the basis that the pub was removed from the Council’s list of ACVs.

Looking ahead

There are some juggernaut cases moving through the First Tier Tribunal in 2017 and the scene is set for pub owners to help shape the law:

  • The most significant appeal is a compensation claim against a London Borough for £3.5 million following the listing of a property and the removal of permitted development rights. The Council also refused planning permission in a decision notice which referenced the ACV listing.
  • Another significant appeal is advancing a compensation claim for the recovery of legal and surveyor’s costs, following the removal of the pub from a Council’s list of ACVs at review stage.
  • Yet another interesting appeal looks set to analyse whether a property trading as a restaurant / hotel with ancillary bar was used in a way to satisfy the community value criteria, given the apparently ancillary nature of whatever use was made of the bar by the local community.

Community interest

As far as the ACV regime is concerned, take up of the community right to bid has been disappointingly low. Of the 106 nominated or listed pub properties we have dealt with, a community interest group was only genuinely interested to the point of bidding, on one pub. And even then the sense in making that bid was highly questionable given that the owner had already committed under contract to the sale of the freehold to a developer. This amounts to a community interest group bid rate of less than 1% for nominated / listed pubs.

The future

It may be time to start tabling a re-think of the utility of the ACV regime, by excluding its application in relation to properties falling within use class A4 (drinking establishments). The imminent growth of Heineken as pub owner, following its acquisition of Punch, together with substantial slowing in the rate of pub closures and a much lower rate of sale for alternative use, suggests that whatever caused CAMRA to feel justified developing its “List Your Local” campaign, it may do a u-turn in 2017.

At this stage it makes sense to continue to take a resolute approach when it comes to unnecessary pub nominations and listings – until the overall future is clearer. That means a steadfast focus on dealing with disruptive and speculative nominations, and reviewing unmeritorious listings, must be continued.

Mark Brown is regularly involved in challenging nominations and listings of pubs as assets of community value, gaining unique insights into the regime and strategies that can be used to contest those nominations and listings.

Freeths’ drinks, hospitality and leisure team works extensively with pub and restaurant operators, having gained, over the course of 25 years, a profound understanding of how the law impacts on the industry, both at a strategic and operational level. As well as handling the routine legal work which keeps the business afloat, from property acquisitions and disposals to commercial contracts and disputes, the team has expertise in regulatory issues including those arising from the Pubs Code.