Tallington Lakes Limited v South Kesteven District Council

This is an appeal by the freehold owner of Tallington Lakes, a leisure park in Lincolnshire, against a decision of the First-tier Tribunal (“the FTT”) in December 2021 requiring it to pay a fee to the respondent, South Kesteven District Council, in respect of its site licence, and against the FTT’s decision in March 2021 on a preliminary issue in the same proceedings.

The appellant was represented at the appeal hearing by Mr Neil Morgan, its director and owner. The respondent was represented by Ms Jenny Wigley KC. I am grateful to them both.

The issues in the appeal are:

Tallington Lakes is a leisure park where numerous outdoor activities are carried on, and a static caravan site. There is a dispute as to whether any of the caravans are in permanent residential use, and that point is not for decision in this appeal.

Section 1 of the Caravan Sites and Control of Development Act 1960 requires the occupier of land used as a caravan site to hold a site licence:

“(1)

Subject to the provisions of this Part of this Act, no occupier of land shall after the commencement of this Act cause or permit any part of the land to be used as a caravan site unless he is the holder of a site licence (that is to say, a licence under this Part of this Act authorising the use of land as a caravan site) for the time being in force as respects the land so used.

(4)

In this Part of this Act the expression “caravan site”  means land on which a caravan is stationed for the purposes of human habitation and land which is used in conjunction with land on which a caravan is so stationed.”

Section 3 of the 1960 Act makes provision for applications for and the grant of site licences. Section 3(3) says:

“(3)

A local authority may on an application under this section issue a site licence in respect of the land if, and only if, the applicant is, at the time when the site licence is issued, entitled to the benefit of a permission for the use of the land as a caravan site … otherwise than by a development order.

So site licences are closely linked with planning permission.

The appellant’ was granted a site licence (licence number 84/2) in 2003, in response to its application. The application was for a seasonal caravan site, in use from 1 March to 31 January each year. The licence recited that the appellant had planning permission for “the use of the said land as a caravan site”; it was granted subject to a condition “that the total number of static holiday caravans sited shall not exceed 385.” A list of planning permissions was scheduled to the licence, and there were seven altogether, whose terms we shall consider later; I refer to them as “the 7 Permissions” so as to identify the seven permissions referred to in licence 84/2.

Section 8 of the 1960 Act enables a local authority to change the conditions attached to a site licence:

“(1)

The conditions attached to a site licence may be altered at any time (whether by the variation or cancellation of existing conditions, or by the addition of new conditions, or by a combination of any such methods) by the local authority, but before exercising their powers under this subsection the local authority shall afford to the holder of the licence an opportunity of making representations.”

In April 2014 the Mobile Homes Act 2013 came into force; it amended and updated the licensing and regulatory regime for caravan sites, and one of the changes it made was to enable local authorities to charge an annual fee to the holder of a licence for a “relevant protected site”, defined in section 5A(5) of the 1960 Act as:

“land in respect of which a site licence is required under this Part, other than land in respect of which the relevant planning permission under Part 3 of the Town and Country Planning Act 1990 or the site licence is …—

(a)

expressed to be granted for holiday use only, or

(b)

otherwise so expressed or subject to such conditions that there are times of the year when no caravan may be stationed on the land for human habitation.”

The omitted words relate to an exception that is not relevant here. The definition is in identical terms to the definition of a “protected site” in section 1(2) of the Caravan Sites Act 1968; where an agreement entitles a person to station a mobile home on land forming part of a protected site, and to occupy it as their only or main residence, then the Mobile Homes Act 1983 applies to that agreement and the person has the benefit of the regulatory regime and security of tenure provided for in the 1983 Act.

The respondent formed the view that that the site was being used for residential occupation. In March 2016 it wrote to the appellant asking it to surrender its licence for alteration so that conditions appropriate to residential occupation could be imposed (as provided for in section 11 of the 1960 Act). It received a reply from Tallington Lakes Leisure Parks Limited stating that the site was not a residential site; no surrender was made. In April 2016 the respondent told the appellant that it was going to alter the conditions of the licence, sending a copy of the conditions to be imposed and inviting representations as section 8 of the 1960 Act requires. No representations were made.

An altered site licence (now numbered 84/3) was issued on 18 May 2016 and sent to the appellant. It recited the 7 Permissions again, and stated that it “permits the land situated at Tallington Lakes … to be used as a Mobile Home Site subject to the Schedule of Conditions attached hereto for not more than 385 caravans at any one time”, and there is an extensive schedule of conditions attached.

Section 7(1) of the 1960 Act enables the licence holder to appeal to the FTT against any of the conditions attached to the licence within 28 days of its issue; no appeal was made.

The respondent did not charge the appellant a fee for the issue of the licence nor for the first year of its operation; but it later invoiced it for the annual fees for 2017 and 2018. Those fees remain unpaid, amounting to £4,173.50.

Section 5A(3) of the 1960 Act enables the local authority, when the fee is overdue, to apply to the FTT for an order that the licence holder pay it; where such an order is made and then not complied with the local authority may apply to the FTT for an order revoking the licence. On 8 July 2019 the respondent applied to the FTT for an order that the appellant pay the unpaid licence fees.

The appellant did not file a response to this application, but on 23 September 2019 made an application purporting to be an appeal against the licence conditions imposed in 2016 and requesting dismissal of the respondent’s application. The FTT directed that the two applications be heard together, and directed the determination of a number of preliminary issues. The one relevant to this appeal is that the appellant asserted that it is not the correct licence holder, and that instead the licence holder should be Tallington Lakes Leisure Park Limited which is the company managing the site. The FTT conducted a video hearing at which it noted that the appellant was not seeking to appeal any of the conditions; the FTT issued a decision on 25 March 2021 in which it determined that the licence was correctly issued to the appellant, Tallington Lakes Limited, and that the appellant had not asked for and was not granted an extension of time to appeal against the licence conditions. In its account of the facts in the opening paragraphs of the decision on the preliminary issues the FTT stated that the licence issued in 2016 was a licence to operate a “Relevant Permitted Site”, by which it no doubt meant a relevant protected site, but if I have understood correctly it had not heard argument on the point and did not make a determination to that effect.

The FTT issued draft directions on 18 October 2021, stating that it would determine the respondent’s application without a hearing and that the directions would become effective on 1 November 2021 unless either party by 29 October 2021 requested alternative directions, The appellant did not request alternative directions but wrote on 18 October 2021 to the regional judge to complain about the FTT judge who had issued the draft directions, stating among other things that the direction that the application be decided on the papers is “absurd”. On 17 December 2021 the FTT issued its final decision. It stated in its description of the background that the 2016 licence “was a licence to operate a Relevant Permitted Site", and it ordered the appellant to pay the fees, on the basis that they were correctly charged and invoiced.

The appellant sought permission to appeal on a number of grounds and was granted permission by the Upper Tribunal on three: first, on the ground that the licence was not correctly issued to it but should have been issued to Tallington Lakes Leisure Park Limited; second, that the FTT should not have determined the application in December 2021 without a hearing; and third, that the site is not a relevant protected site.

Section 1 of the 1960 Act makes provision for site licensing, as we have seen, and forbids an “occupier of land” to cause or permit it to be used as a caravan site unless he holds a licence (paragraph 5 above). Section 1(3) defines an “occupier” as follows:

“(3)

In this Part of this Act the expression “occupier”  means, in relation to any land, the person who, by virtue of an estate or interest therein held by him, is entitled to possession thereof or would be so entitled but for the rights of any other person under any licence granted in respect of the land.”

The subsection goes on to make an exception for the holder of a tenancy of not more than 400 square yards of land.

Ms Wigley KC relied upon the words “by virtue of an estate of interest therein”; a person without a freehold or leasehold estate is not within the definition of “occupier”.

The appellant is the freeholder of the site and has held the licence since 2003. But the appellant now says that it is not the occupier of the site. Mr Morgan argued that “occupier” in section 1(1) means “the person or entity who actually and de facto occupies the land and operates it as a caravan park”, which in this case is Tallington Lakes Leisure Park Limited. He said that this is the longstanding and universally applied meaning of the term.

He relies upon section 10(4) of the 1960 Act:

“(4)

Where any person becomes, by operation of law, entitled to an estate or interest in land in respect of which a site licence is in force and is, by virtue of his holding that estate or interest, the occupier of the land within the meaning of this Part of this Act he shall, for the purposes of this Part of this Act, be treated as having become the holder of the licence on the day on which he became the occupier of the land, and the local authority in whose area the land is situated shall, if an application in that behalf is made to them, endorse his name and the said date on the licence.”

The appellant argued that because the statute deals expressly with an occupier by operation of law, it must be the case that some occupiers are occupiers for a different reason, for example a management agreement.

Mr Morgan has misunderstood section 10, which is about transfers of licences. Section 10 is about how a licence can be transferred when the licence holder ceases to be the occupier of the land, and there are two possibilities. First, section 10(1) is relevant where the occupier of land changes because of some deliberate act, for example a sale, and it enables a licence holder who ceases to be the occupier of land to transfer it to the person who has become the occupier. Second, section 10(4) deals with the situation where the occupier changes not because of a deliberate act but by operation of law, for example when the occupier dies. Section 10 does not say anything about who can hold a site licence.

Mr Morgan also referred to the wording of application forms for licences, such as the respondent’s own. The form asks if the applicant is an individual or a business, and Mr Morgan argued that if the applicant had to be a freeholder or leaseholder the form would ask if it was a freeholder or leaseholder. I do not agree; the local authority has regulatory reasons for asking about the nature of the proposed licence holder, but that does not change the statutory requirement. The form asks the applicant to state its “interest in land (give particulars of lease or tenancy, if any)”, which Mr Morgan said implies that the applicant may have no interest in the land. Again this does not assist, because the point of the “if any” is that the applicant may be the freeholder.

As Ms Wigley KC pointed out, it is notable that section 12(2) of the 1960 Act grants the occupier under section 1(3) the right, as against any person claiming under a licence or under a tenancy excluded by section 1(3) (see paragraph 20 above), to enter on the land and do anything reasonably required for the purpose of complying with any conditions; it follows that a licensee is not the occupier even if its licence would enable it to exclude the freeholder or leaseholder but for section 12(2).

The wording of section 1(3) of the 1960 Act is clear and unambiguous; the occupier has to occupy the land “by virtue of an estate or interest therein”, meaning a legal or equitable estate or interest; the wording is not broad enough to encompass a licensee or the manager under a management contract.

Accordingly the appeal fails on ground 1; the occupier and the correct licence holder is the appellant as the freeholder of the site.

Once the preliminary issue had been decided the FTT had to decide the respondent’s application for an order that the appellant pay the outstanding fees. As I said above, it issued draft directions for a determination to be made on the papers, with an invitation for the parties to request alternative directions. The FTT did not accept the appellant’s letter to the Regional Judge as such a request.

Rule 31 of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013 requires the FTT to hold a hearing before making a decision, unless each party has consented to it doing so without a hearing. A party may be taken to have consented if “no objection has been received” within a stated time.

The appellant in its letter to the Regional Judge did express a very clear objection. Ms Wigley KC has confirmed that the respondent makes no submissions on this ground of appeal.

I find that the appellant did object, within time. The second ground of appeals succeeds; the FTT should not have decided the respondent’s application on the papers in December 2021 and its decision is set aside.

The third ground of appeal is that Tallington Lakes is not a relevant protected site; if it is not, then the respondent is not entitled to charge a fee for the licence under section 5A of the 1960 Act. As I have set aside the FTT’s decision of 17 December 2021, I have to decide whether to remit the matter to the FTT for it to make a fresh decision after a hearing, or to substitute the Upper Tribunal’s decision on the third ground. Mr Morgan said at the start of the hearing that he wanted me to remit the matter, although he had set out his arguments about the third ground at length both in his skeleton argument and in a supplemental skeleton that he filed in response to Ms Wigley KC’s skeleton. She asked me to substitute the Tribunal’s own decision on this ground

I explained to the parties at the hearing that I would hear the appeal on whether the site is a relevant protected site, if the Tribunal had sufficient material on which to hear it. I said that I took the view that the Tribunal had all the relevant material in front of it and that since both parties had set out their arguments on this ground in their skeleton arguments I could decide the appeal on this point. Mr Morgan agreed that I should proceed on that basis.

At the hearing of the appeal Mr Morgan and Ms Wigley KC presented their arguments about ground 3, following the lines they had taken in their pleadings. I set out those arguments before dealing under a separate head with a different argument presented by Mr Morgan in his closing submissions after lunch.

It is worth reiterating the definition of a relevant protected site in section 5A of the 1960 Act:

“land in respect of which a site licence is required under this Part, other than land in respect of which the relevant planning permission under Part 3 of the Town and Country Planning Act 1990 or the site licence is …—

(a)

expressed to be granted for holiday use only, or

(b)

otherwise so expressed or subject to such conditions that there are times of the year when no caravan may be stationed on the land for human habitation.”

It is not in dispute that Tallington Lakes is land in respect of which a site licence is required, The respondent takes the view that neither the 2003 licence 84/2, nor the 2016 version 84/3, is expressed to be granted for holiday use only and neither imposes a restriction on the stationing of caravans for human habitation. The reference in licence 84/2 to static holiday caravans in the condition did not restrict the site to holiday use.

Ms Wigley KC’s argument focused on whether the planning permissions for the site are expressed in the terms stipulated by section 5A(a) and (b). She took the singular “relevant planning permission” to include the plural since more than one permission is in force across the area covered by the licence, in accordance with section 6 of the Interpretation Act 1979 which provides that “words in the singular include the plural and words in the plural include the singular” unless the contrary intention appears. For the exception in section 5A to apply, Ms Wigley argued, all the planning permissions must be expressed as in section 5A(a) or (b).

And so we come back to the 7 Permissions referred to in the 2003 and 2016 versions of the licence. Each licence, as I said above, lists seven planning permissions, and what they say is as follows:

Arguably, therefore, two of the permissions restrict the site to holiday use. Three of the others restrict the times in the year when caravans can be stationed there for human habitation. Two of the permissions are wholly unrestricted.

I agree with Ms Wigley’s construction of section 5A(5): in order for the land the subject of the licence to fall outside the definition of a relevant protected site either the licence or the planning permission – which means the permission or permissions that cover the site and by virtue of which the licence is granted – must be expressed to be for holiday use only, across the whole site, or must be on terms that “that there are times of the year when no caravan may be stationed on the land for human habitation” across the whole site. Where the licence and planning permissions allow mixed use that includes residential, the site is a relevant protected site.

The site is a relevant protected site as defined in section 5A(5) of the 1960 Act and the appeal fails on ground 3.

Accordingly although I have set aside the FTT’s decision I have substituted the Tribunal’s own decision that the fees are payable as charged, and the Tribunal requires that they be paid by the appellant within 28 days of the date of this decision.