Hemming case update: Supreme Court rules sex shop licence fee fight continues to EU Court of Justice

Hemming case update: Supreme Court rules sex shop licence fee fight continues to EU Court of Justice

Partner, Steve Dillon, gives an update on the Supreme Court’s long-awaited ruling on the case of Hemming and others –v- Westminster City Council, and the ongoing legal battle on licensing fees.

The Supreme Court has ruled that it is lawful for licensing scheme operators to re-charge the costs of regime enforcement to its licensees, but not as part of the fee paid by applicants for entry into the scheme. The question as to whether such costs can be re-charged by way of a fee paid at the same time as an application fee has been referred for determination by the Court of Justice to the European Union in Luxembourg.

The retailers in this case, all represented by Gosschalks instructing Philip Kolvin QC, Victoria Wakefield and Matt Hutchings, were the operators of licensed sex shops in Soho, London.

The retailers sought redress from Westminster City Council more than 4 years ago during which period, after their comprehensive success in the High Court, the Council brought a succession of appeals during which most of their arguments have been either abandoned or rejected by the Courts.

In the process the case has clarified / established several other important points of legal principle both in relation to the licensing sector and civil procedure, including that:

  • Licence fees set by a local authority must be determined by a committee or officer with duly delegated authority to do so;
  • When setting such a fee, local authorities must carry forward both surpluses and deficits;
  • Local authorities must ring-fence the fees and not make a profit from that scheme; and
  • Part 36 Offers made to local authorities do not have special status just because they are made to a public body.

Steve Dillon, Partner, Head of Insolvancy and lead commercial litigation solicitor in this case, added:

“That the legal battle is set to continue for years more as a result of referral to the European Court of Justice is disappointing, but our clients firmly believe that ultimately the right decision will be made.  Gosschalks are happy to have been able to provide support to these retailers in the High Court, Court of Appeal, and Supreme Court and will continue to do so in Europe.”

You can find out more about the ruling here.

Need advice? We can help you?

If you think you have overpaid licensing fees to your local authority please call Steve Dillon today on 01482 325252 or email sld@gosschalks.co.uk.

Find out more about our Licensing services and our Commercial Litigation services.

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