Factual and Procedural Background
This opinion concerns a petition for judicial review brought by Company A, challenging three decisions of the Licensing Board for The City dated 20 June 2003 under Section 32 of the Gaming Act 1968. The petitioners operated three bingo halls in The City and had applied for renewal of their licences along with directions to increase the maximum number of Amusement With Prizes (AWP) machines allowed at each premises. The Licensing Board, which had a longstanding policy capping AWPs at 37 per premises, refused to increase the maximum numbers requested by Company A. Company A sought judicial review of those refusals, arguing the Licensing Board had acted unreasonably, failed to provide adequate reasons, and that the policy itself was irrational and ultra vires. The petitioners also contended breaches of their rights under Article 6 of the European Convention on Human Rights. The Licensing Board maintained that their policy was legitimate, consistently applied, and that no duty to provide written reasons arose. The petition was heard in the Outer House of the Court of Session and the court considered extensive submissions and authorities before delivering this opinion.
Legal Issues Presented
- Whether the Licensing Board erred in law or exercised its discretion unreasonably in refusing to provide written reasons for its decisions under Section 32 of the Gaming Act 1968.
- Whether the Licensing Board's policy capping the maximum number of AWP machines at 37 per bingo premises was irrational, ultra vires, or an improper fetter on the Board's discretion.
- Whether the petitioners' rights under Article 6(1) of the European Convention on Human Rights were engaged and, if so, whether the Board breached any duty to provide reasons or fairness in its decision-making process.
- Whether the Licensing Board, newly constituted after local elections, had properly adopted and understood the policy it applied.
Arguments of the Parties
Petitioners' Arguments
- The Licensing Board failed to provide written reasons for its decisions, breaching the petitioners' rights to a fair hearing under domestic law and Article 6 of the European Convention on Human Rights.
- The Board's policy was irrational and ultra vires, imposing arbitrary numerical limits on AWP machines unrelated to demand and failing to take into account relevant considerations such as the advice of the Gaming Board.
- The Board did not properly consider the applications, deciding them in less than 30 minutes, indicating inadequate decision-making.
- The newly constituted Board after local elections had not reviewed or adopted the policy as their own, undermining the legitimacy of the decisions.
- Reliance on domestic and Strasbourg case law (e.g., Coyle v City of Glasgow Council, R v Home Secretary ex parte Doody, Catscratch Limited v City of Glasgow Licensing Board, Jacobsen v Sweden, and others) to support the necessity of reasoned decisions and engagement of Article 6 rights.
- Demand for AWPs should be a relevant factor, but the Board's policy ignored demand, focusing instead on occupancy capacity and an absolute cap.
- The absence of written reasons prevented the petitioners and the court from assessing whether discretion was exercised properly.
Respondents' Arguments
- The Licensing Board had continuity of membership before and after local elections; thus, the policy was properly adopted and understood by the Board members.
- The Board was entitled to adopt and apply a policy to regulate the number of AWPs, aiming to preserve the social club atmosphere and ensure safety and convenience.
- The numeric cap of 37 machines was a legitimate exercise of discretion, not irrational or arbitrary, and consistent with the Board’s statutory powers under Section 32.
- There was no statutory or common law duty to provide written reasons for the exercise of discretion under Section 32, and the petitioners knew the reasons for the decisions through the hearing and policy.
- Article 6 of the European Convention on Human Rights was not engaged because the petitioners had no substantive civil rights or entitlement to a higher number of AWPs; the Board’s decisions were discretionary benefits without legal rights.
- Previous case law supported the legitimacy of the Board’s policy and discretion, including Mecca Leisure Limited v City of Glasgow Licensing Board and Caledonian Nightclubs v Glasgow District Licensing Board.
- The Board had reviewed and continued to review its policy, including after the 2003 elections, demonstrating an open mind and proper exercise of discretion.
- Demand was not a mandatory criterion under the legislation for fixing the maximum number of machines, and the Board was not required to consider it.
Table of Precedents Cited
| Precedent |
Rule or Principle Cited For |
Application by the Court |
| Gala Leisure Limited v Glasgow Licensing Board (2000) 15 S.L.L.P. 16 |
Licensing Board discretion under Section 32; absence of reasons does not imply irrationality if no material to the contrary. |
Cited as precedent for the Board’s broad discretion and that refusal to increase AWPs to 50 was not irrational. |
| Coyle v City of Glasgow Council 1997 S.L. 453 |
Obligation of licensing authorities to keep under review relevant factors (unmet demand) in licensing decisions. |
Distinguished on facts; statutory provisions there imposed specific obligations not present under Section 32. |
| R v Home Secretary ex parte Doody (1994) AC 531 |
Developing duty to give reasons for administrative decisions as a matter of fairness. |
Discussed in relation to evolving law on giving reasons; no absolute duty under Section 32 found. |
| Catscratch Limited v City of Glasgow Licensing Board (No. 2) 2002 S.L.T. 503 |
Application of Article 6 ECHR to licensing board decisions. |
Accepted that Article 6 may apply to licensing boards, but not determinative in this case. |
| Jacobsen v Sweden (1989) 13 E.H.R. 56 |
Article 6 applies to civil rights even when discretion is wide, requiring fairness. |
Used to counter argument that wide discretion excludes Article 6 engagement. |
| R (Alconbury Developments & Ors) v Secretary of State (2001) 2 WLR 1389 |
Article 6 applies to administrative decisions affecting civil rights, but with regard to the nature of discretion. |
Supported the view that Article 6 may apply but does not mandate reasons in all cases. |
| Caledonian Nightclubs v Glasgow District Licensing Board 1996 S.C. (H.L.) 29 |
Licensing board discretion in defining locality and refusing licenses based on over provision. |
Analogous to the Board’s discretion in setting AWP limits; court respects Board’s local knowledge. |
| Elder v Ross and Cromarty District Licensing Board 1990 S.L. 307 |
Permissibility of a statutory body to adopt and apply a policy provided it does not fetter discretion and considers individual cases. |
Confirmed that the Board’s policy was lawful and properly applied. |
| British Oxygen Co v Board of Trade (1971) AC 610 |
Unqualified discretion can be limited by policy but must not be exercised irrationally or in bad faith. |
Applied to show Board’s policy was a legitimate exercise of discretion. |
| Mecca Leisure Limited v City of Glasgow Licensing Board 1987 S.L. 483 |
Refusal to grant direction under Section 32 not irrational if aimed at preserving social character of premises. |
Supported the legitimacy of the Board’s policy and discretion in the present case. |
| Masson & Van Zon v Netherlands (1996) 22 EHRR 491 |
Discretionary benefits do not necessarily engage civil rights under Article 6. |
Used to argue no Article 6 engagement since no substantive civil right created by Section 32. |
| Matthews v Ministry of Defence (2003) 1 AC 1163 |
Article 6 protects procedural fairness but does not create substantive civil rights. |
Confirmed that Article 6 does not impose substantive rights beyond domestic law. |
| Runa Begum v Tower Hamlets LBC (2003) 2 WLR 388 |
Distinction between public law rights and civil rights for Article 6 purposes. |
Supported the argument that discretionary benefits under Section 32 do not engage Article 6. |
Court's Reasoning and Analysis
The court began by examining the statutory framework under the Gaming Act 1968, noting that Parliament set a low statutory maximum of four AWP machines per bingo club premises, with the possibility of adjustment by direction of the licensing authority under Section 32. The discretion granted to the Licensing Board was unqualified and did not create any legal entitlement or expectation for licence holders to operate more than four machines unless directed.
The court found that the Licensing Board had developed and applied a policy since 1993, capping the maximum number of AWPs at 37 based on occupancy capacity and other considerations such as maintaining the social character of bingo clubs and ensuring safety and convenience. This policy was legitimate, rational, and a proper exercise of the Board's discretion. The court rejected the petitioners’ argument that the policy was arbitrary or irrational, noting that the Board had reviewed the policy over time and that the numerical cap was a qualitative judgment within their powers.
The court further held that the petitioners were fully aware of the policy and the reasons for the decisions at the hearing, including the opportunity to persuade the Board to change or relax the policy. The absence of written reasons was not fatal, as the petitioners knew the basis of the decisions and the policy was well established. The court emphasized that there was no statutory or common law duty to provide written reasons in this context, and the lack of such reasons did not render the decisions irrational or unlawful.
Regarding the engagement of Article 6 of the European Convention on Human Rights, the court concluded that the petitioners did not possess substantive civil rights in respect of the number of AWPs allowed, as Section 32 conferred only a discretionary benefit. Consequently, Article 6 procedural guarantees did not apply. Even if Article 6 were engaged, the court found that the petitioners were not treated unfairly, having had a fair hearing and knowing the reasons for the decisions.
The court also dismissed the argument that the newly constituted Board had not adopted the policy, finding continuity in membership and that the policy was presumed to continue until changed. The court found no evidence of bad faith or perversity in the Board’s decision-making process.
In sum, the court found that the Board lawfully exercised its discretion under Section 32, applied a rational and legitimate policy, and that the petitioners’ challenges were without merit.
Holding and Implications
The petition for judicial review was dismissed.
The court sustained the Licensing Board’s second plea in law, affirming that the Board’s policy capping AWPs at 37 machines per bingo premises was a lawful exercise of discretion and not irrational or ultra vires. The petitioners were not entitled to written reasons beyond what they already knew, and Article 6 of the European Convention on Human Rights did not apply to confer a right to such reasons in this context. The decision confirms the broad discretionary powers of licensing authorities under Section 32 of the Gaming Act 1968 and affirms the legitimacy of applying consistent policies to regulate gaming machines in bingo clubs. No new precedent was set beyond the application of existing principles to the facts of this case. The direct effect is that the Licensing Board’s decisions stand and the petitioners remain subject to the existing policy and limits on AWPs.