Town and Country Planning Act 1971, section 22(2)(f) and Town and Country Planning (Use Classes) Order 1972 — Shops used for the viewing of films by customers in coin-operated booths — Whether unauthorised development constituting breach of planning control — Appeal by company owning and operating shops against a decision of McCullough J, who dismissed their appeal from a decision of the Secretary of State upholding enforcement notices served by local planning authority — Appellants, who owned several shops in respect of which the same issue arose, contended that, by virtue of section 22(2)(f) and Class I in the Schedule to the Use Classes Order, the introduction of film-viewing operations did not involve development — The case turned on the true construction of the opening words of article 2(2) of the order — ‘”shop” means a building used for the carrying on of any retail trade or retail business wherein the primary purpose is the selling of goods by retail’ — The issue was the narrow one as to whether the words ‘wherein the primary purpose is the selling of goods by retail’ restricted the scope of the earlier words in the definition, so that a building used for the carrying on of a retail trade or business would not be a shop unless the primary purpose for which the building is used is the activity of sale itself, or whether the words quoted enlarged the scope of the earlier phrase so as to make a building a shop so long as its primary use is the selling of goods by retail — The appellants argued in favour of the latter interpretation, but the Court of Appeal held that the restrictive interpretation was correct — On the appellants’ construction a large store used wholly for the selling of goods by retail could begin any number of new uses so long as the selling of goods by retail remained the primary use — Such freedom was contrary to the general scheme of the 1971 Act — Appeals dismissed
Lydcare Ltd, the appellants, owned and occupied premises in Charing Cross Road, Brewer Street and Old Compton Street, in the area of which the local planning authority was Westminster City Council. After the appellants began to use parts of their premises for the viewing of films in coin-operated booths the council served enforcement notices. The present appeal was from the dismissal by McCullough J on April 27 1983 of their appeal against a decision of the Secretary of State on November 12 1982 rejecting their complaints against the enforcement notices.
Michael Rich QC and David Smith (instructed by Offenbach & Co) appeared on behalf of the appellants; Simon Brown (instructed by the Treasury Solicitor) represented the first respondent (the Secretary of State); G S Lawson-Rogers (instructed by the Solicitor, Westminster City Council) represented the second respondents (the planning authority).
Giving the first judgment at the invitation of the Master of the Rolls, PARKER LJ said: These three appeals concern alleged breaches of planning control by the appellants, Lydcare Ltd, at three separate premises owned and occupied by them and situate respectively at 159-163 Charing Cross Road, WC2, 26 Brewer Street, W1, and 35 Old Compton Street, W1.
As the facts and issues in all three cases are in all material respects identical and as it is common ground that the decision on any one appeal must inevitably lead to the same result on the other two, I shall consider in detail only the appeal relating to 26 Brewer Street.
The appellants had originally used the premises, which comprise a ground floor and basement, as a shop within the meaning of the Town and Country Planning (Use Classes) Order 1972 (SI 1972 no 1385) for the purpose of selling of goods by retail and for no other purpose. At some time prior to 1981 they began to use the premises also for the viewing by customers of films in coin-operated booths. The film viewing took place wholly in the basement. The selling of goods by retail took place on the ground floor. It is, however, accepted that the entire premises formed a single unit for planning purposes.
On February 18 1981 the Westminster City Council, which is the local planning authority under the Town and Country Planning Act 1971 (the Act), having taken the view that the use of the basement for the viewing of films constituted an unauthorised development and thus a breach of planning control, served on the appellants, pursuant to section 87 of the Act, an enforcement notice requiring them to discontinue such use by April 1 1981.
In exercise of the right given them by section 88(1) of the 1971 Act the appellants appealed to the Secretary of State against the enforcement notice, inter alia on the ground specified in section 88(2)(b), namely, that the matters alleged in the notice did not constitute a breach of planning control. It is with this ground alone that this court is concerned.
As a result of that appeal, a local inquiry was held and on November 12 1982 the Secretary of State, subject to certain immaterial qualifications, dismissed the appeal, upheld the enforcement notice and refused to grant planning permission on the application deemed to have been made under section 88B(3) of the Act.
From this decision the appellants appealed to the High Court. That appeal was dismissed by McCullough J on April 27 1983. From that decision the appellants now appeal to this court.
The relevant part of the Secretary of State’s decision on the appeal against the enforcement notice reads as follows:
. . . it is considered . . . that the installation of the eight coin-operated, film-viewing booths at your client’s premises and their mode of operation are not properly to be regarded as a use which is ancillary, or subordinate, to the main use of the premises as a shop. The view is taken that the installation and continuing provision of these facilities constitute a separate main use of the premises, namely for the viewing of films in coin-operated booths; and the inspector’s conclusion that planning permission should have been obtained for this separate main use of the premises is therefore accepted. Accordingly, it is considered that there has been a breach of planning control; and your client’s appeal on ground (b) in section 88(2) of the 1971 Act therefore fails.
The issue to be determined arises in this way. Under section 22(1) ‘development’ includes ‘the making of any material change in the use of any buildings or other land’, but section 22(2) provides that, for the purposes of the Act, certain uses of land shall not be taken to involve development. Among such uses are included, by subparagraph (f) of the subsection:
in the case of buildings or other land which are used for a purpose of any class specified in an order made by the Secretary of State under this section, the use thereof for any purpose of the same class.
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A material change of use thus prima facie constitutes a development and, if carried out without the grant of planning permission, constitutes a breach of planning control by virtue of section 87(3) of the Act, unless it can be brought within section 22(2).
Mr Rich for the appellants accepts that the introduction of the film-viewing operations in the basement constitutes a material change of use but contends that it is, by virtue of section 22(2)(f) and the Use Classes Order, nevertheless not to be taken to involve development and accordingly that there was no breach of planning control. On the face of it, this would seem to involve the submissions:
(i) That prior to the introduction of the film-viewing use, the premises were being used for the purpose of a class specified in an order under the section. There is no dispute about this.
(ii) The use for film viewing was a use for some other purpose of the same class.
I go therefore to the Use Classes Order which was made under the section. The classes, which number 18, appear in the Schedule. Class 1 is ‘Use as a shop for any purpose except . . .’ and there are then five exceptions.
Shop is defined in article 2(2) in the following terms:
‘shop’ means a building used for the carrying on of any retail trade or retail business wherein the primary purpose is the selling of goods by retail, and includes a building used for the purposes of a hairdresser, undertaker, travel agency, ticket agency or post office or for the reception of goods to be washed, cleaned or repaired, or for any other purpose appropriate to a shopping area, but does not include a building used as a fun-fair, amusement arcade, pin-table saloon, garage, launderette, petrol filling station, office, betting office, hotel, restaurant, snackbar or cafe or premises licensed for the sale of intoxicating liquors for consumption on the premises.
Article 3(1) then repeats, in effect, section 22(2)(f) of the Act.
Since the viewing of films is not itself the use for another purpose of the same class, it is at first sight difficult to see how the appellants can bring themselves within section 22(2)(f) and article 3(1) and McCullough J held that they could not.
Mr Rich’s argument, however, proceeds in this way:
(i) Before the introduction of the film-viewing activity the premises were undoubtedly a shop within the meaning of the Use Classes Order. They were used for the carrying on of a retail trade or business wherein the primary purpose was the selling of goods by retail.
(ii) When the film viewing had been introduced, they continued to be used for the carrying on of a retail trade or business wherein the primary purpose was the selling of goods by retail and were still therefore a shop albeit that it was now a mixed-use shop.
(iii) There was, accordingly, only a change from one to another Class I purpose and no development.
The success or failure of this argument depends upon the true construction of the words in the definition of shop, ‘a building used for the carrying on of any retail trade or retail business wherein the primary purpose is the selling of goods by retail’.
Mr Rich’s contention is that any building used primarily for the selling of goods by retail is a shop. If this be right, then a large store used wholly for the selling of goods by retail could begin any number of new uses so long as the selling of goods by retail remained the primary use. So long as such uses were merely ancillary or incidental to the main use, this would be right, as it is clear law that such incidental or ancillary uses fall within the main use and so do not constitute material changes of use. If, however, any of them was not of such a character but was of sufficient type or intensity to be a main use, it would ordinarily constitute a development. It is conceded that, if a building were used for any of the particular purposes specified in the definition of shop, the introduction of another main use not within the definition would constitute a development. Thus there would be a development if there were introduced into a building used for the purpose of a hairdresser, undertaker or ticket agency, use for the viewing of films as a main use. For the building would then be used not for the purpose of hairdresser etc but for the mixed use of a hairdresser and the viewing of films. It is, on the face of it, difficult to see why it should have been intended that a building not used for one of the specified purposes but used solely for the selling of goods by retail should have been accorded the freedom from planning control contended for. Such a freedom would enable a large store to use part of its floorspace for a series of different purposes falling within different use classes even including one of the expressly excepted uses under Class I, such as a tripe shop, so long only as the primary purpose was the selling of goods by retail.
The provision of such freedom appears to me so contrary to the general scheme of the Act that clear words would be necessary to achieve it. In my judgment they are not there. The definition does not begin ‘a building used primarily for the selling of goods by retail’, which is what Mr Rich contends is the effect of the words actually used. It begins ‘a building used for the carrying on of any retail trade or retail business’. Had the further phrase been omitted, the result would certainly have been that the introduction of a separate main use such as the viewing of films would constitute a material change of use and thus a development. The question, therefore, is, in the end, the very narrow one whether the following words ‘wherein the primary purpose is the selling of goods by retail’ restrict the scope of the earlier phrase, so that a building used for the carrying on of a retail trade or business will not be a shop unless the primary purpose for which the building is used is the selling of goods by retail, or whether they enlarge the scope of the earlier phrase so as to make a building a shop so long as its primary use is the selling of goods by retail.
I have no doubt that the words have the restrictive and not the enlarging effect. A retail trade or business has many facets and if on a large scale may be conducted in separate buildings. It will or may require, for example, offices, store or stock rooms, maintenance workshops, and garages for its delivery vans. But for the qualifying phrase, a building used mainly for stock rooms in a retail business but conducting only a small amount of retail selling would fall within the definition. The qualifying phrase prevents it from so doing. This is understandable and shows a readily discernible purpose. The alternative contended for by Mr Rich appears to me, as it did to the learned judge, to make no sense. Furthermore it runs counter to the natural meaning of the words in section 22(2)(f) and article 3(1) of the Use Classes Order.
If a building is used as a shop and is thus within Class I of the order but a substantial part of it then begins to be used, for example, for the ‘boiling of linseed oil and the running of gum’ within Class VIII(iii) of the order, can it be said it is then being used for ‘any purpose of the same class’ (using the words of section 22(2)(f)) or ‘any other purpose of the same class’ (using the words of article 3(1))? In my judgment, it cannot.
The true view is that, prior to the introduction of the new use, the building was used for the carrying on of a retail trade or business. whereas after such introduction it was used for the mixed purpose of carrying on a retail trade or business and boiling linseed oil, and one never reaches the question whether the primary purpose was the selling of goods by retail. If, of course, the boiling of linseed oil was ordinarily incidental to and included in the use as a shop, the additional use would be saved from being a development on the ground that it was a separate use within the Use Classes Order, by article 3(1) and, so long as it was purely ancillary, by the general law, but neither of these avenues of escape is open or contended for in the present case.
Our attention was drawn to a number of authorities, but I find it unnecessary to refer to any save two of them in any detail, for the point is a pure point of construction upon which they afford no assistance. I should, however, mention that if Mr Rich’s contention were sound, both Hussain v Secretary of State for the Environment (1971) 23 P&CR 330 and Ahmed v Birmingham City Council (1972) 224 EG 689 would have been wrongly decided. The point was apparently not raised or noticed by the court in either case, but had it been I have no doubt the decisions would have been the same. Both cases were in my view rightly decided.
One of the two cases to which more detailed reference is necessary is Marshall v Nottingham City Corporation [1960] 1 All ER 659 upon which Mr Rich placed some reliance. In that case Glyn-Jones J took the view that the word ‘wherein’ referred back to ‘trade or business’ not to ‘building’. That is, in my view, wrong for two reasons. In the first place, had it been intended to refer back to trade or business, the natural word to use would be ‘whereof’ rather than ‘wherein’. In the second place, it is difficult to see how the principal purpose of a retail trade or business could be other than the selling of goods by retail.
The second case meriting detailed reference is Emma Hotels Ltd v Secretary of State for the Environment (1979) 250 EG 157, [1979] 1 EGLR 151. In that case three former private houses had been converted for use as an hotel. The premises included a small bar open to non-residents. The owners considerably extended the area of the bar. An enforcement|page:182| notice was served in respect of the use of the enlarged area. In his judgment Bridge LJ at p 159 said:
Before the extension of the non-residents’ licensed bar area involved in what is now alleged to have been a material change of use for the purposes of planning law took place, there cannot be the slightest doubt that the whole unit, nos 25, 26 and 27, constituted an hotel providing sleeping accommodation, and was within that class. The question I ask myself is whether the fact that the permitted small area included in no 27 for use as a non-residents’ bar has been enlarged to take in the area to which the enforcement notice relates for some reason takes the entire premises outside the ambit of Class XI.
For my part, I am quite unable to see that it does. Mr Collins, who has said everything that could be said on behalf of the respondent Secretary of State, has drawn attention to the fact that in the definition of a ‘shop’ there are specifically excluded from the definition, inter alia, hotels and premises licensed for the sale of intoxicating liquor, which are there dealt with as separate entities. That confirms the provisional view I expressed that they are indeed different uses. But it does not follow from that, in my judgment, that an hotel providing sleeping accommodation in any way ceases to come within Class XI if it includes as one of the incidents of the hotel use use of part of the hotel premises as a bar open to non-residents. Both bars and dining-rooms are common features of hotels providing sleeping accommodation. I suppose the vast majority of hotels up and down the country include such facilities, and in many, many cases those facilities are open to the general public and not confined to use by persons who are residing in the hotels.
Mr Rich submitted that this case affords him considerable assistance, for the approach was to see whether the added use took the whole premises out of the specified class. I am unable to agree. It appears to me that he can get no assistance from the case, for the passage quoted shows clearly that Bridge LJ based himself on the conclusion that the use objected to was merely an ordinary incident of the class use in question. This is confirmed by the judgment of Donaldson LJ when the matter came before the court on a second occasion: see (1981) 41 P & CR 255.*
*Editor’s note: reported also at (1980) 258 EG 64, [1981] 1 EGLR 145.
I would dismiss the appeal in relation to Brewer Street for the above reasons. For similar reasons I would dismiss also the appeals relating to the other two premises.
Agreeing, SIR JOHN DONALDSON MR said: In this court there has been no argument as to the facts. The sole dispute has been as to statutory construction. The relevant planning units are the three shops. Originally each was used solely for the actual sale of goods by retail and such storage as was ordinarily incidental thereto. The goods sold were not such as to take the use of the premises outside Class I of the Schedule to the Use Classes Order 1972. The introduction of the additional activity of viewing films was not de minimis but was a material change of use as a matter of fact and degree, if it was material as a matter of law. However, the primary or major use of the premises continued to be for the purposes of the retail sale of goods.
Mr Rich, for the appellants, Lydcare Ltd, submits that the definition of Class I, based as it is upon the defined meaning of the word ‘shop’, differs from that of any other class in that it requires the planning authority to have regard only to the primary use of the planning unit. If, therefore, the primary use is a Class I use, it is impossible for there to be any other use for planning purposes, whereas if the primary use fell within any other class, there could be mixed uses. Mr Rich could advance no reason why Class I should be the exception to the general approach to use classification. However, this is immaterial in the sense that if, whether by intention or an inadvertent error in drafting, this is the true construction of the statutory provisions, Lydcare are entitled to claim that there has been no development and therefore no breach of planning control.
I do not think that on any view of the definition of Class I, a wholesale or non-retail trade or business could be carried on in the building without there being at least mixed uses, even if the primary use was for the purpose of retail trade. It follows that the key to this problem lies in the words ‘retail trade or retail business’ in the definition of ‘shop’.
If the word ‘retail’ conveys the concept of dealing with individual members of the public, then Mr Rich’s submission makes sense. The building is used as a shop if it is wholly used as a retail establishment, wherein the primary purpose is the sale of goods by retail, the subsidiary purpose being the viewing of films by individuals. If, however, the word ‘retail’ itself is confined to the sale of goods, then the whole purpose for which the building is used must be a trade or business consisting of the sale of goods and the primary purpose to which regard is to be had must be the activity of sale itself, as contrasted with ancillary activities such as storage of goods for sale, accounts departments, and transportation services, in so far as they are not ordinarily incidental to the activity of sale. I insert this qualification because some storage, for example on shelves adjacent to the point of sale, is ordinarily incidental to the activity of sale, but not bulk storage. So, too, is the keeping of accounts by cash register, but not the keeping of ledger accounts.
Reference to the Shorter Oxford English Dictionary shows that the word ‘retail’, whether used substantively, adjectively, adverbially or as a verb, always indicates the sale of goods in small quantities. It follows that the only use of a building which can qualify as a shop use is one which is concerned with the sale of goods in small quantities and it only in fact qualifies if the primary purpose for which the building is used is the actual process of selling.
If this analysis is correct, these three premises had a mixed use — (a) retail trade which, because the primary purpose was the actual process of selling, qualifies as a shop use, (b) a non-retail trade use, which could not qualify as a shop use, namely the viewing of films. Accordingly, in my judgment, there was unauthorised development and a breach of planning control.
I would dismiss the appeal.
Also agreeing, SLADE LJ said: Mr Rich expressly accepted that, in each of these three cases, the new mixed use of the premises for the sale of goods by retail and for the viewing of films in coin-operated booths must constitute the making of a ‘material change’ in the use of the premises and thus ‘development’ within the definition contained in section 22(1) of the Town and Country Planning Act 1971, unless section 22(2)(f) of that Act removes this new use from the definition of ‘development’.
He also accepted that section 22(2)(f) can have this effect only if the new mixed use of the premises is a use falling within the same class specified in the Town and Country Planning (Use Classes) Order 1972 as that within which the use of the premises previously fell — that is to say ‘use as a shop’ under Class I.
The material words in the definition of ‘shop’ contained in article 2(2) of the Use Classes Order, on which Mr Rich principally relied, read as follows:
‘Shop’ means a building used for the carrying on of any retail trade or retail business wherein the primary purpose is the selling of goods by retail . . .
However, if a building is to constitute a ‘shop’ within this definition when properly construed, in my opinion it inevitably has to comply with two conditions, namely
(1) it has to be used for the carrying on of a retail trade or retail business, and
(2) the primary purpose of such use has to be the selling of goods by retail.
It cannot, in my opinion, suffice that the building satisfies one condition if it does not satisfy the other.
While it seems that after the change of use, the premises in the present cases continued to satisfy condition (2), in my opinion they manifestly did not satisfy condition (1). For thereafter the use was in part for purposes wholly different from those of the carrying on of a retail trade or retail business, that is to say the viewing of films. Section 22(2)(f), therefore, cannot in my opinion avail the appellants. But for Mr Rich’s skilful argument, I would have thought that the contrary view was almost unarguable.
For these brief reasons, and those more fully given by the Master of the Rolls and Parker LJ, I, too, would dismiss these appeals.
The appeals were dismissed with costs. Leave to appeal to the House of Lords was refused.