A recent decision in the First Tier Tribunal, which hears appeals from Council decisions to refuse to remove pubs from its list of assets of community value (ACV), has provided some clarity in relation to CAMRA’s ineligibility to make so-called hybrid ACV nominations.
The case was also important in discussing the issue of when it might be realistic to think that use of a property as a pub might resume in the next five years.
Campaign for Real Ale Limited has been encouraging its branches to make as many ACV nominations as possible of properties within their respective areas, as part of its “List Your Local” campaign. In many instances this has led to indiscriminate ACV nominations of former pubs trading as hotels and restaurants, as well as pubs which simply do not require listing because there is no prospect of the property coming up for sale. Other side effects are to include potential development land unconnected with the trading property in question, and to scupper sales of pubs as going concerns, leading to closure of the pub itself.
Facts of the case
In this case, Hamna Wakaf Limited, the owner of the Grosvenor public house in Stockwell, found the pub nominated to be listed as an ACV by CAMRA’s South West London Branch. The nomination was a so-called hybrid nomination, in which the nominator identified itself as Campaign for Real Ale Limited (wrongly, as it turned out at the hearing), but sought to rely on the membership and activities of the branch local to the Grosvenor in order to establish its eligibility to make the ACV nomination.
The Grosvenor was listed as an ACV on 12 August 2015 but the owner sought a review of the Council’s decision to list. The reviewing officer, a chartered surveyor and former partner at Knight Frank, quite rightly sought and relied upon advice from leading counsel. The advice was that CAMRA South West London branch was a qualifying nominator as an unincorporated body – being a voluntary or community body for the purposes of the ACV Regulations.
During the review the owner of the Grosvenor also argued that it was not realistic to think that the Grosvenor might be used as a public house again, because it had entered into an agreement to lease the ground floor and basement to the Co-operative Food Group, for a term of 15 years.
Extensive evidence was produced to show that there was little or no interest in the ground floor for public house use. However planning permission for change of use of the ground floor would be required. Whilst the Council later showed a willingness to grant change of use of the upper floors to residential, that was on condition that the ground floor and basement remained as a public house.
Judge Peter Lane made a number of interesting findings in relation to the eligibility of CAMRA to have made the nomination:
- Firstly, he said that the Tribunal’s previous decision in another case (St Gabriel Properties Ltd v London Borough of Lewisham and another) was wrong in finding that the CAMRA branch could rely upon the corporate (limited by guarantee) status of Campaign for Real Ale Limited to make a community nomination of a property as an ACV, in the branch’s own right. There can be no doubt that this is legally correct. It is regrettable that the FTT previously made legally incorrect findings, which has undoubtedly resulted in casualties in the industry, at CAMRA’s hands. However it is perhaps even more disconcerting that CAMRA and/or its branch members themselves took advantage of the FTT’s mistake, to the disadvantage of perhaps hundreds of private property owners, for the benefit of their own campaigning activities.
- He also said, controversially (in our view), that Councils may in some circumstances have the right to waive statutory evidential requirements – such as the number of electoral voters who were members of the unincorporated body and registered within the Council’s area – for CAMRA branches to show that they are eligible to make community nominations. This is controversial because Parliament required voluntary or community bodies to have a local connection with land in a local authority’s area, and waiving statutory evidential requirements in relation to the local connection is inconsistent with Parliament’s will. This sends the wrong signals to Councils, who need to bear in mind the sometimes serious prejudicial effects of ACV listing.
- Finally, he discussed the issue of whether or not it is realistic to think that the Grosvenor might resume use as a pub, with the community value which attached to that use, in the next five years. In this respect he took account of the Council’s willingness to permit change of use of the upper parts to residential use (without the Council actually granting planning permission), conditional on retention of the ground floor as a public house. Notwithstanding David Elvin QC’s submissions as regards the obvious scope for challenging such conditionality under the National Planning Policy Framework, the Judge held that whilst the upper parts should be de-listed as an ACV, the ground floor should remain ACV listed.
- It has to be remembered that the FTT’s decisions do not bind itself or any other decision maker.
- Judge Lane’s admission that the FTT was wrong in the previous St Gabriel case will serve as an important reminder that Councils should not rely on the FTT’s findings and views expressed.
- It is also a reminder that owners whose pubs are listed should not accept what appears to be the hand dealt to them. This is important because the FTT is adopting some unattractive positions from the perspective of property owners. For example holding that owners are not entitled to compensation for a decrease in value of their property as a consequence of the listing of it as an ACV (contrary to Government guidance which the FTT has itself relied upon in other respects).
The Future of ACVs
Our experience is that owners are, more than ever, engaging with the issues created by ACVs. A larger body of authority is developing, now, in relation to the legal, planning and valuation issues created by listings. For example we have recently taken over conduct of a case acting for an owner seeking to challenge a decision of the FTT to keep a property listed as an ACV, where there was very little evidence before the FTT as to why the property was said to attract community value.
We are also acting in a £3.5m compensation claim against a London Borough Council, and frequently advise, in the background, on planning applications and how to approach development of ACV listed buildings.
If you are affected by an ACV nomination or listing we would be interested to speak to you to gain a fuller picture of the current ACV landscape.
Freeths acted for the successful appellant in the case of Hamna Wakaf Limited –v- (1) London Borough of Lambeth and (2) CAMRA South West London Contact: Mark Brown
Contact: Mark Brown