Defending decisions on assets of community value

The pub trade across the UK is struggling. A recent survey showed that pubs are closing at the rate of two every day with nearly 400 pubs closing their doors for good in England and Wales in the first half of 2023.

Many local residents and community activists try to safeguard and retain their local pubs by nominating them as Assets of Community Value or “ACVs” under the Localism Act 2011. If the local authority deems a nomination to meet the statutory test, the ACV is then entered on a register. Inclusion on the register results in the statutory regime imposing a moratorium when there is an intention to dispose of the listed asset. Its disposal is held up for a period, giving local community groups the opportunity to organise to bid for it.

In 2022, the Montreal Arms pub in Hanover, Brighton was bought with the intention that it be turned into a residential development. Shortly thereafter, Brighton & Hove City Council received an ACV nomination from a group of local residents calling themselves the Friends of Montreal Arms. Although the pub had been in disuse for the past three years, the Council determined that the pub met the statutory test of being an ACV as:

There was a time in the recent past when an actual use of the building that was not ancillary use furthered the social wellbeing or interests of the local community; and
It is realistic to think that there is a time in the next five years when there could be a non-ancillary use of the building that would further (whether or not in the same way as before) the social wellbeing or social interests of the local community.

The owner of the building appealed against the listing and the matter came before Judge Neville sitting in the FTT. The Friends of Montreal Arms declined to participate or provide evidence at the hearing to support the nomination. This left the Council in the difficult position of defending the nomination decision by itself.

In a decision that will be instructive for local authorities who are left to defend such decisions without the support of the nominating group, Judge Neville found on the two key statutory tests that:

a. There was sufficient evidence to show that the pub had been in use in the ‘recent past’ bearing in mind that “special account does need to be taken of the consequences arising from the Covid-19 pandemic” and that “the doors stayed open until the pandemic hit.” Interestingly, considering whether that use in the recent past furthered the community’s social well-being, the Judge was not persuaded that the pub played host to wedding receptions, live music, or fringe theatre as suggested by the nominating group but instead found that it was really “a drinking man’s boozer”. “Its value to the community’s wellbeing lay in the oasis of calm it provided away from ‘spaces for creative activity’ and the like.”

b. As to whether it was realistic to think that there is a time in the next five years that the pub could return to being of some social wellbeing or social interests use, the Judge noted that the nominating group’s lack of involvement in the proceedings made it “unlikely that there is any current real proposal to purchase and operate the Montreal Arms.” However, the Judge observed that the Council’s draft local plan, although not adopted at the time of the Council’s decision, gives protection to public houses as it provides that planning permission will not be granted for redevelopment/change of use except in certain prescribed circumstances. The Judge noted that this supported the case for inclusion as it meant there was a “real chance that any change of use to residential accommodation will be refused permission, and by priority being given in any event to any community use (whether or not as a pub”).

Bearing in mind the low threshold for the “realistic to think” test (i.e., not fanciful), the Judge considered that “it is realistic to think that it might…be opened in the future by a person or group that does not need it to turn a profit, or even to pay its own way. Not only might a community group or individual be willing to bear a pub as a loss-making venture, some pubs are opened as a retail outlet for micro and small breweries…likewise, some small and independent pubs strike deals with local takeaways and restaurants rather than run their own kitchens – the notion that a kitchen is necessary to survive is not representative of the many and varied pubs operating in the UK.”

Judge Neville concluded by noting that “while the prospects are slim that the Montreal Arms will see any use in the next five years that would further the social wellbeing or social interests of the local community, it is still realistic to think that it could.”

The decision is an important reminder that ideally nominating groups should participate in ACV appeals. However, a Council can nonetheless successfully defend such cases when the groups decline to do so. The decision also provides a helpful overview of the statutory regime and the relevant tests and case law to be applied in such appeals (see R(TV Harrison CIC) v Leeds School Sports Association [2022] EWHC 130 Admin). Finally, it is a reminder of the usefulness and versatility of local plan policies protecting local community uses and demonstrates that even a loss-making, kitchen-less, ‘drinking man’s boozer’, only attracting a few ‘old boys’ to play darts, can still merit protection under the statutory regime.

A copy of the decision, Dragonfly Architectural Services Ltd v Brighton & Hove City Council [2023] UKFTT 946 (GRC), is available here.

John Fitzsimons is a barrister at Cornerstone Barristers. He appeared for Brighton & Hove City Council.