Entertainu Ltd, R (on the application of) v Westminster City Council

J U D G M E N T

1. MR JUSTICE COLLINS: On 13th May 2002 Westminster City Council served an enforcement notice on the claimants in respect of premises which they occupied at 26 Wardour Street, W1. That is the part of Wardour Street which is south of Shaftesbury Avenue and is now on the edge of an area which is described as Chinatown. The enforcement notice alleged a change of use from Class A3 food and drink to use as a hostess bar at the basement and ground floor. It required that that use cease.

2. The claimants had in fact been operating the premises as a hostess bar for some considerable time. They had obtained licences from the Westminster City Council enabling them to continue that use. It does appear that, for whatever reason, the licensing side and the planning side of the City Council had not appreciated that these premises might be operating in breach of planning consent. In fact it turned out that that was indeed the case. It is not disputed that the use is being carried on without the necessary planning permission.

3. An application was made for planning permission but that was turned down by the City Council on 28th February 2002. The grounds given for turning down the application were:

1. The use of the premises as a hostess bar is considered to be detrimental to the residential amenity by reason of the external activity associated with the hostess bar use such as touting and increase in the fear of crime or actual crime."

There was then reference to the policies of the adopted UDP, (1997 vintage) and policies in the replacement UDP (Second Deposit version) of January 2002, that is an ongoing emerging new UDP and, as I understand it, the public inquiry has not yet taken place in relation to it.

4. The second ground for refusal was:

"The proposal would, by reason of the external activity associated with the hostess bar use and the design, size and location of the signage, adversely affect the character and appearance of this part of the Soho Conservation Area... "

Again that was said to be contrary to policies of both the adopted and the emerging UDP.

5. It will be noted that both reasons relate to the external activity associated with the bar use: touting, increase in crime, and the adverse affect on the character and appearance from the design, size and location of the signage. What is not said in those reasons for refusal is that any hostess bar in this part of Wardour Street would adversely affect the character and appearance of that part of the conservation area.

6. That refusal led (because the activity continued) to the enforcement notice. The enforcement notice itself is a lengthy one and sets out in some detail the reasons for issuing it. In paragraph 4(2) this is said:

"This part of Wardour Street is close to the centre of China Town in Gerrard Street and is characterised by restaurants at basement and ground floor levels. Although there is much commercial activity in the locality the upper floors are primarily in office and residential use. Indeed, the upper floors of this building are in residential use. It is considered that local residents are adversely affected by the hostess bar, principally by the touting that takes place and the associated crime and disorder that this use causes."

Then it suggested that the pavement was narrow and the touting was intimidating. There was evidence from the Metropolitan Police of touting. There had been a considerable number of calls to the police alleging actual offences of assault and also the demanding of exceedingly high fees from customers (about £300 it was said for the service of one soft drink and the company of a hostess). Threats and intimidation had been used to encourage payment. It was considered that the use of the premises as a hostess bar caused a high incidence of crime. The notice goes on in subparagraph 5:

"The use is therefore considered to be contrary to policy STRA 16 of the Replacement [that is the emerging UDP] which seeks to reduce the fear of crime, actual crime and nuisance for residents, businesses and visitors."

It goes on to note that the premises are within the defined area where sex-related uses will be considered; that is a reference to what at the present is the Commercial Activity Zone (CAZ), and which is to be replaced by a zone (which appears to be coterminous) where sex-related uses would be considered. The approach is that outside the CAZ no premises with sex-related uses would be granted planning permission; within the CAZ they would only be granted planning permission if, in the circumstances, there was no adverse impact from them. The matter is helpfully set out in the relevant policy (TACE 8) in the existing UDP, where this is said:

"The City Council's general policies on entertainment activities are:

(A) Proposals for new or expanded entertainment uses will not normally be permitted outside the Central Activities Zone or within the Central Activities Zone where they would have a significant detrimental impact on the amenity of residents and the general environment...

(C) Planning permission for entertainment facilities will not normally be granted ... where the amenity of residents would be appreciably injured or where a proposal is incompatible with the existing character and function of the area."

7. So that is the general approach. As the reasons for the enforcement notice make clear, it is within the CAZ and there is a history of the premises being used at various times for sex-related uses, but those have been unauthorised. Enforcement action has successfully been taken on a number of occasions to secure the cessation of the unauthorised use.

8. Westminster City Council had set a maximum of 16 licensed sex establishments in the relevant CAZ area. There were Rule 4A waivers which permitted activities involving nudity. The City Council said that because they had exceeded the maximum number, this particular use was contrary to the relevant policy. It went on in subparagraph 14 in the these words:

"This part of the Soho Conservation Area is characterised by commercial uses at basement and ground floor level (many of which are restaurants) and offices and residential above. It is acknowledged that parts of Soho have historically been associated with the sex industry. However, it is considered that despite the fact that the mixed character of Soho includes an element of sex-related uses, to allow the continuation of this use would harm, rather than preserve or enhance, the character of the conservation area, by contributing to this imbalance of uses. The presence of the hostess bar, by virtue of the external activity associated with it (touting and, crime and disorder), is prejudicial to the continued attractiveness of Soho as a place to live, and in this sense it is considered harmful to the character of the conservation area as a whole."

There is also reference to the signing, which is said to be harmful because of the design, size and location of the signs. Advertisement consent had been refused for them in October 2001.

9. There is in those reasons only the one reference to Chinatown where, at the outset, it is said, as I have already indicated, that the relevant part of Wardour Street was close to the centre of the Chinatown in Gerrard Street. What is nowhere said in the reasons for the enforcement notice is that the proximity to, or the existence within, the area which is regarded as Chinatown by itself would mean that the existence of a hostess bar was unacceptable. Thus Mr Leigh, on behalf of the claimant, submitted that the case, as understood by the claimant, was not that a hostess bar by itself would be contrary to the policies or would of itself impact adversely on the conservation area, in particular, because of the existence of Chinatown, but rather that this particular hostess bar, because of the touting and because of the crime, had that effect.

10. Miss Davies submits that the local authority in their reasons have made it clear that there was an objection on the basis of Chinatown alone. She draws attention to the response to the claimant's submissions put in by the Planning and Licensing Department of Westminster City Council (that is their statement of case). At paragraph 7 the City Council's case is set out. It mirrors to a large extent the reasons that were eventually given in the enforcement notice. It makes the point about the narrowness of the pavement; the problems of touting; the effect on local residents, and the concerns of the police about activities within the premises. It makes the point that the police considered that the presence of a sex hostess bar that generates such a scale of complaint merely adds to the seedier image that prevails in this area during the evening period. It is plain that that quote was related to the scale of complaint which had been generated by this particular bar.

11. The more general matters upon which Miss Davies relies commence in 7.14. It reads:

"Although it is acknowledged that parts of Soho have historically been associated with the sex industry, this particular part of the Soho Conservation area is more associated with the distinctive character of Chinatown.

7.15 Chinatown is the area in and around Gerrard Street/Lisle Street and is the home of London's Chinese community and forms the largest and most centrally located Chinatown in Europe. The specialist nature of the area and its contribution to the character of London is recognised in the Government's Regional Planning Guidance for London RPG 3 (para 2.29).

7.16 The area profile of Soho from the City of Westminster Planning and Transportation Supplementary Planning Guidance Note, December 2001 - CAZ Area Profiles is included in Appendix 8.

7.17 It is considered that the hostess bar does not form part of the local Chinatown character and is out of place in this part of Soho and fails to either preserve or enhance it.

7.18 With regard to the Soho Conservation Area as a whole is it considered that the continuation of the hostess bar would harm, rather than preserve or enhance, the character of the conservation area, by contributing to imbalance of sex related uses in the area. The presence of the hostess bar, by virtue of the external activity associated with it (touting, crime and disorder) is prejudicial to the continued attractiveness of Soho as a place to live, and in this sense it is considered harmful to the character of Conservation Area."

So, there submits Miss Davies, the distinction is drawn between the impact on the Chinatown character in that the hostess bar is said not to form part of that local character, and is out of place in that part of Soho, and the more general impact on the conservation area as a whole, which is limited to this bar because of the touting, crime and disorder associated with it.

12. At paragraph 9.3 she points out that there is a response to a 1986 planning decision that was relied on by the claimants in their submissions, where the Inspector had specifically indicated that in his view a well run establishment (in that case a topless bar) was not be regarded as wrong in that part of Wardour Street. In fact that particular decision, as I understand it, related to adjacent premises to the one in question.

13. The comment made in the response by the local authority was:

"This appeal was allowed before the City Council's policies regarding sex uses were introduced and the Chinese character of this part of Soho was consolidated. More recently, appeals against near beer/hostess bars have been dismissed."

14. It seems to me that it appeared to be clear from the way that the matter had been put in the formal reasons in the enforcement notice, and in the formal reasons for refusing planning permission, that what was being said was that this particular hostess bar, because of the activities associated with it (namely touting and crime) was not to be permitted in this part of Soho; indeed, it was not to be permitted at all. Although one can read what Miss Davies submits is the more general approach in the paragraphs to which I have made reference, the fact is that in context, and having regard to the expressed decision, it is by no means clear that it was being said that, in effect, no hostess bar could ever properly be granted planning permission in this part of Wardour Street. Certainly, that was not what was understood by those representing the claimant.

15. It is to noted that this was an appeal which was dealt with on written representations. Accordingly, it was necessary for the Inspector to be careful to ensure that he did not decide the matter on a basis which had not been put to the parties and upon which the parties, had not been able to make proper and full representations.

16. Miss Davies refers me too to the report of the Planning Subcommittee of 28th February which led to the refusal of planning permission. In the summary, it is said:

"Both the application and the unauthorised use are considered unacceptable by reason of the loss of amenity to neighbouring residential occupiers, increased incidence of crime and fear of crime, and adverse affect on the character and appearance on this part of the Soho Conservation Area."

She submits that it was there being made clear that there were three aspects. Unfortunately, those were translated not into three but into two when the reasons were eventually given. Again, if one goes on to read the body of the report it is clear in my judgment that what was being suggested to the subcommittee was that this hostess bar, for various reasons, was unacceptable. The draft reasons were the eventual reasons which I have already set out.

17. So that was how it came before the Inspector. He made two visits to the site: one accompanied and one with the consent of the parties unaccompanied. He gave one decision because the appeal against the enforcement notice was on the basis that planning permission should be granted. Accordingly, the appeal against the refusal of planning permission and the appeal against the enforcement notice, raised essentially the same issue.

18. The Inspector identified the main issues in paragraph 3 of his letter:

"From my visits to the area and reading of the representations I find that the main issues here are, firstly, the effect of the hostess bar on the living conditions of nearby residents and, secondly, its effect on the character and appearance of the surrounding area which forms part of the Soho conservation area."

That is wholly correct provided, as Mr Leigh would submit, the effect on the character and appearance is limited to this hostess bar as opposed to any hostess bar.

19. The Inspector dealt with the effect on residents and the issue of touting and the complaints of what was going on inside the premises. He concludes in paragraph 8:

"However there is no evidence of crime or public disorder outside the premises ... "

He considered that those matters, that is to say the complaints of overcharging and criminal activities within the premises, had no bearing on the lives of local residents. He found that the operation of the bar had no significant harmful effect on the living conditions of those who lived nearby. That disposed of the first ground for the refusal of planning permission. He did not uphold the Council's objections.

20. He then went on to consider the second ground, which related to the character and appearance of the area. In paragraph 10 he dealt with the residential aspect. He said that in view of his finding that the operation of the bar did not significantly harm the living conditions of residents, he did not share the Council's view that permission should be refused on the basis of its effect on the residential components of the area's character. He recorded the claimant's views that this was within the heart of one of the capital's main entertainment areas and within an area where, subject to certain criteria, sex-related uses would be considered. There was no adverse affect on the area because the bar was small: only two or three members of the public could be accommodated at a time, and any external activities were minimal.

21. The Inspector then went on to point out that, as he put it, the enclave between Shaftesbury Avenue and Leicester Square, centred on Gerrard Street and Lisle Street, had a different and very distinctive character; this was because of the Chinese element. He goes on:

"The stretch of Wardour Street south of Shaftesbury Avenue including No 26 is on the edge of, but in my view part of, this distinctive Chinatown area. I saw no evidence of other sex-related uses, apart from handwritten notes in a few open doorways in Lisle Street which indicated the presence of flats used by prostitutes. I considered that a hostess bar is out of character in the setting of Chinatown and I share the view expressed by the Metropolitan Police that any touting for business which may take place, whilst not necessarily distressing or intimidatory, suggests a seedier aspect of London life; as such this too would detract from the character of Chinatown."

22. It is to be noted that the view expressed by the Metropolitan Police was expressed to be because of the activities that went on in this particular hostess bar, it was not an attack on hostess bars in general, or at least did not appear to be so.

23. In paragraph 13 he said that he had taken policy TACE 13 of the emerging development plan into account because it indicated the need to address the implications of sex-related uses in the West End, but he had not felt bound by the proposed definition of the Soho Sex-Related Uses Area, which might yet be modified. He reached the view that the presence in Chinatown of the hostess bar, subject to appeal, diluted the special ambience of the area and was, therefore, harmful to its character.

24. He concluded:

"As the objection to the development is one based on fundamental policy grounds, it could not be overcome by any of the conditions suggested to regulate the detailed operation of the use."

25. That is the fundamental objection to the Inspector's approach. Mr Leigh says that the Council had in its expressed reasons concerned itself with the detailed operation of the use and not with the fundamental policy objection, if there was one, to any hostess bar in this part of Wardour Street. That was a very different objection to the one which the claimant thought he was having to meet. Although he had referred to the 1986 planning decision, that was in the context of underlining his point that a hostess bar in this part of Wardour Street was not objectionable in principle. The Inspector did not give any reasons for deciding that that decision not a material one.

26. Miss Davies submits that it was ancient; lapse of time had resulted in a change of circumstances: Chinatown had expanded and was now recognised as an important part of Soho, much more than had been the case back in 1986. She asked me to note that it was a decision which only granted specific permission to an individual for a period of five years, but that was because that Inspector's reservation had related to the possibility that Wardour Street was described as a project route through Soho; that, as I understand it, was a pedestrianised or partly pedestrianised street, which people would be encouraged to use if they wished to walk through Soho. It might be that the encouragement of tourists would not sit well with hostess bars along the route. He said that the Council's planning witness then did not seek to suggest that Wardour Street was, in principle, an inappropriate location for such businesses. It may now have decided that this is the case, but it did not say so in terms in connection with these particular proceedings. As I say, they were based on the particular use of these premises and the activities associated with them. To an extent, the Inspector came down in the claimant's favour in relation to those uses.

27. Miss Davies submits that the Inspector's decision would inevitably have been the same had he given his reasons for not following the 1986 decision. In any event, as she puts it, the impact on the Chinatown part of the conservation area was a matter which was at large.

28. For the reasons that I have given, I take the view that it was not sufficiently clear, indeed it was not clear at all, in the way that the matter had been put before the Inspector by the local planning authority, that that was a case that they would have to meet. Certainly the Inspector did not indicate that that was the way he was thinking, so that they could have had an opportunity of dealing with it. The reality is, as I see it, that this is a case where the Inspector has dismissed the appeal on a ground which the claimant was not properly able to cover in his submissions. That being so, I should quash this decision insofar as it refuses planning permission and remit it, insofar as it is an appeal against the enforcement notice, for reconsideration by the Secretary of State.

29. If the decision was necessarily going to be the same I would not grant that relief. But I cannot say in the circumstances that had the matter been dealt with on the basis that no topless bar could properly be granted planning permission in this part of Wardour Street, and if that had been the only issue, as the Inspector seemed to regard it in the circumstances, the decision, if representations had been able to be made by the claimant, and the local authority's stance had been ascertained, would necessarily have been the same. I cannot say that that is so.

30. In those circumstances, I propose to find, as I have indicated, in favour of the claimant.

31. MR LEIGH: My Lord, I am grateful for your carefully worded judgment. My Lord, there are two matters I believe I need to deal with. The short matter of course is costs, and a figure has been agreed between the parties.

32. MR JUSTICE COLLINS: Miss Davies, you cannot resist, can you, in principle?

33. MISS DAVIES: I cannot resist in principle, my Lord, no.

34. MR LEIGH: A figure has been agreed between those sitting behind counsel. I give your Lordship the figure. A figure of £9,078.75, which I would invite your Lordship to----

35. MR JUSTICE COLLINS: Is that accepted as a reasonable figure?

36. MISS DAVIES: It is, my Lord, yes.

37. MR LEIGH: Fourteen days, my Lord?

38. MR JUSTICE COLLINS: I will not make any specific order. I do not know what the usual order is. I will just say the appeal is allowed with costs.

39. MR LEIGH: I am not sure if no date is specified, if a date will automatically come?

40. MR JUSTICE COLLINS: There may be something in the CPR.

41. MR LEIGH: My instructing solicitor is reminding me, and I think he is right on this, that if your Lordship does not make any order it is forthwith; that is my recollection too.

42. MR JUSTICE COLLINS: I do not think so.

43. MR LEIGH: Unless there is something that operates differently.

44. MR JUSTICE COLLINS: All I can say then is that I must have made a lot of forthwith orders.

45. MR LEIGH: I do not think any point will be taken on it, but I have raised it with your Lordship.

46. MR JUSTICE COLLINS: Yes, £9,078.75.

47. MR LEIGH: My Lord, there is only one other point, I do not know whether I do need to deal with it. One recalls that under the new regime that followed when the changes came in in relation to enforcement notices, there is this question of what one does with the effect of the notice.

48. MR JUSTICE COLLINS: You mean should it be suspended or carry on?

49. MR LEIGH: Yes. There is no application from the local authority, or indeed anybody else for that matter, that its suspension should not carry on as it would ordinarily by reason of the enforcement notice.

50. MR JUSTICE COLLINS: Presumably this bar cannot continue unless it has a licence, is that right?

51. MR LEIGH: I need to take some instructions, my Lord. It can certainly operate in planning terms.

52. MR JUSTICE COLLINS: In planning terms, yes, but in actual terms, does it not need a licence?

53. MR LEIGH: Because they are not selling alcohol they do not need a licence.

54. MR JUSTICE COLLINS: I see. They do not even have a near beer licence?

55. MR LEIGH: They have pending applications unsurprisingly, and I can imagine which way the decision might go on those. But the bottom line is that the business can lawfully carry on at the moment unless and until the enforcement is upheld eventually by either an inspector and/or High Court challenge.

56. MR JUSTICE COLLINS: What about the advertising, because they have been refused some advertising?

57. MR LEIGH: It needs regularisation or the local authority----

58. MR JUSTICE COLLINS: Does that need another enforcement notice or a separate enforcement notice?

59. MR LEIGH: Yes, it does. It is all entirely a matter for the local authority. I made inquiries before we started this morning, I understand that there has been, if I can put it this way, no friction between the local authority and ourselves.

60. MR JUSTICE COLLINS: Miss Davies, I do not think it is necessary, is it, for me to make any specific order?

61. MISS DAVIES: My Lord, no. In my experience no specific order is made. My own understanding is that the Inspector's decision having been quashed and it having been remitted, there is now a live appeal.

62. MR JUSTICE COLLINS: It is as if the appeal was still pending?

63. MISS DAVIES: Indeed, yes.

64. MR LEIGH: We simply raised it, my Lord, because it is in the section itself and it seemed proper for me to make sure your Lordship was aware----

65. MR JUSTICE COLLINS: Unless you are asking me to make any order, I do not think there is anything I should do, merely, as I have indicated, remit the enforcement notice and quash the refusal of the planning permission. The matter will have to go back for reconsideration by the Secretary of State. How he does it will be a matter no doubt for representations; whether there will be an inquiry or whether it will be by further written representations, or however.

66. MR LEIGH: Yes, I simply raised it. I agree with my learned friend that, in effect, unless your Lordship were to rule otherwise, it carries on being suspended.

67. MR JUSTICE COLLINS: I would have thought so.

68. MR LEIGH: Thank you very much.

69. MR JUSTICE COLLINS: Thank you.