Licence revocation appeals and a change in circumstances

The E11 Coffee Lounge in Leytonstone, within the London Borough of Waltham Forest, faced a multi-agency intelligence-led raid in January 2025. Officers from the Home Office’s Immigration Enforcement Team, together with police and licensing officers, arrested four people suspected of being illegal workers. Customers were also found to be smoking both shisha pipes and cigarettes in a room that, it was alleged, did not comply with the smoke-free regulations under the Health Act 2006. This raid followed a criminal conviction of the operator back in 2022 for permitting illegal smoking in the premises (in a prosecution where the actual licence holder was acquitted).

The case highlights the importance of “passage of time” and a licence holder’s responsibility for the actions of their tenants in premises licence reviews held under the Licensing Act 2003.

Following the raid, the Home Office launched a standard premises licence review under section 51 of the Licensing Act 2003. At a review hearing before a licensing sub-committee of the Council on 29 April 2025, the Home Office applied for the revocation of the licence. They were supported by the Metropolitan Police, the Licensing Authority (as a responsible authority) and the Council’s Food and Safety team who enforce the smoke-free regulations.

At the review hearing the corporate licence holder produced evidence demonstrating that it was merely the landlord of the premises and, since September 2019, the premises had been operated under a Management Agreement by a third-party tenant. That agreement had been terminated a few days prior to the review hearing. However, it was pointed out by the responsible authorities that a newly appointed co-director of the company that held the licence was present in the premises during the January raid, and so there were questions to be asked about just how detached the licence holder was from the operator, their tenant.

In its determination, the basis of the Council’s decision to revoke the licence was as follows:

a) The sub-committee were concerned that the principal director of the licence holder, had fallen short of his responsibilities as holder of the premises licence, and were unconvinced that he would do better in future;

b) In particular, he had failed to take any sufficient action about the issue of smoking (both shisha and cigarettes) within the premises despite a previous prosecution;

c) He had failed to take any sufficient action in respect of the employment of illegal workers despite his co-director having been present at the raid by Immigration Enforcement in January 2025; and

d) His belated termination of the management agreement he had in place with another entity, to whom he had delegated the task of running the premises, was insufficient reassurance that events would not recur.

The Council had regard to paragraphs 11.27 - 11.28 of the section 182 Guidance which indicates that the employment of illegal workers (among other crimes) should be treated particularly seriously and it is expected that revocation of the licence – even in the first instance – should be seriously considered. The review hearing was reported in the Evening Standard.

The licence holder appealed the revocation to the magistrates’ court and continued operating in the interim. The previous tenant was excluded from the premises and control of the licensed operation was transferred back into the hands of the licence holder. A new, experienced Designated Premises Supervisor was appointed to run the venue. No smoking of any sort was permitted on the premises.

The premises then operated compliantly, and without any issues of crime, disorder or nuisance whatsoever, for the next seven months until the appeal hearing was listed before District Judge Sher at Stratford Magistrates’ Court on 1-3 December 2025. Prior to the appeal hearing, the Council had refused two without prejudice offers by the licence holder to settle the appeal without the need for a hearing.

It was submitted on behalf of the Appellant that the primary question for the Court to determine on appeal was not whether the decision of the Council to revoke the licence was right at the time it was made, back in April 2025. Instead, the role of the Court was to consider the very different position in December 2025 and ask itself whether, in light of the evidence produced on appeal, the decision to revoke the licence is now the wrong one, even if it was right at the time it was made. The burden of establishing the decision is now wrong lies on the Appellant. This follows from the leading decision on the correct approach to licensing appeals set out in R(Hope & Glory Public House Ltd) v City of Westminster Magistrates Court and Westminster City Council [2011] EWCA Civ 31 .

In the course of the appeal, the Appellant accepted that it had failed to adequately supervise its tenant and, as the licence holder, bore ultimate responsibility for promoting the licensing objectives. However, it was a highly relevant factor that the unlawful, and wholly unacceptable, activity that led to the review was carried out by a third-party and not by the licence holder itself. The yardstick by which licence holders should be judged is not one of perfection.

In support of its contention that, as of December 2025, the decision to revoke the licence is now wrong the Appellant pointed to:

1) The termination of the Management Agreement and exclusion of the transgressing tenants. The premises was now operated by the licence holder and not a third party. New operating policies were implemented which helped prevent the previous issues recurring.

2) The issue-free operation of the premises for seven months. This passage of time is relevant to the Court’s consideration. In London Borough of Lambeth v Ashu [2017] EWHC 3685 (Admin), Stuart-Smith J observed [at §19, emphasis added]:

“…, the mere fact that there has been a change of circumstances between the original decision of the [Licensing Sub-Committee] and the […] time of the review by the magistrates is not of itself sufficient to entitle the magistrates to substitute their own exercise of a discretion for that of the LSC. The burden remains upon the appellant before the magistrates to show that the decision of the LSC was wrong when made or is wrong by the time of the review by the magistrates whether because of altered circumstances or for any other reason. It is possible that the decision of the LSC is beyond criticism when made but that the passage of time may make it the wrong decision at the time that it is reviewed by the magistrates because of a change in circumstances or even the passage of time alone.

3) The promotion of the licensing objectives is ultimately a forward-looking exercise and the experience since the review hearing should give the Court confidence that the objectives would be promoted in the future. In East Lindsey District Council v Abu Hanif [2016] EWHC 1265 Jay J, observed:

“The question was not whether the respondent had been found guilty of criminal offences before a relevant tribunal, but whether revocation of his licence was appropriate and proportionate in the light of the salient licensing objectives, namely the prevention of crime and disorder. This requires a much broader approach to the issue than the mere identification of criminal convictions. It is in part retrospective, in as much as antecedent facts will usually impact on the statutory question, but importantly the prevention of crime and disorder requires a prospective consideration of what is warranted in the public interest, having regard to the twin considerations of prevention and deterrence.”

The Court accepted the Appellant’s submissions though the decision was a finely balanced one. The Judge found that the Council’s decision to revoke the licence was right at the time it was made back in April 2025, but in light of the passage of time and change in circumstances it was no longer the right one.

The appeal was allowed and revocation overturned. Instead, the Judge imposed a number of conditions on the licence proposed by the Appellant. These conditions were designed to ensure that:

1. The previous tenants could have no future role in the business.
2. No shisha or cigarette smoking was permitted unless and until the Council had confirmed the premises was compliant with the smoke-free regulations.
3. Licensable activities could only be carried on by the licence holder and not a third-party entity, for example, under a  Management Agreement.
4. All right to work checks were the responsibility of the licence holder.
5. For a period of 18 months the licence holder shall arrange for independent professional inspections of the premises to ensure compliance.
6. The exclusion of the junior director of the licence holder from the business.

The case highlights the importance of any change of circumstances between the initial decision taken at the review hearing and the appeal hearing. That interim period is an opportunity for licence holders to demonstrate they can do better. Councils and responsible authorities must also be alive to the fact that if the licence holder has demonstrated real change, and there is no evidence to undermine that claim (as in the present case), then an appeal court may take a different approach to that of the sub-committee.

Gary Grant of Francis Taylor Building, instructed by Fabien Simms of FSL Consultancy acted for the successful Appellant Licence Holder. Josef Cannon KC of Cornerstone Barristers acted for the London Borough of Waltham Forest, instructed by the Council’s legal department.