Law relating to Licences

THE LAW RELATING TO LICENCES FOR l<EEPING PETROLEUM SPIRIT

C. S. McDONALD, M.A. (Oxon.), D.M.A. L.A.M.P.T.I., Deputy Town Clerk, Reading County Borough Council.

"N B othing utler. is certain in Jaw, except the expense"-Samuel

Grandi and Another v. Milburn! .This case was a rare event; it is very infrequently that the High Court is requested to interpret provisions of the Petroleum (Regulation) Acts, 1928 and 1936, and regulations made under them. In view of the frequency with which counsel are consulted by local authorities on such questions of interpretation, I find this rather surprising. This lack of litigation ?1Ust constitute to some extent a tribute to the diplomacy and Ingenuity of the officers enforcing the Acts, and to the forebearance and understanding of the general public and the petroleum companies. Personally, I find the ambiguity and uncertainty of some of the provisions somewhat disturbing. This is not to imply that I regard the decision in Grandi v. Milburn as an unmixed blessing. In effect, Mr. Justice James delivered the Judgement, which resolved into interpretations of ~he words "kept", "premises" and "conveyance", none of which is defined in the relevant legislation. I think it vital that there should be a definitive, if not exhaustive, interpretation of the word "kept" as used in the Acts and regulations. The "Concise Oxford Dictionary alone, gives eighteen different meanings of the verb "to keep". Moreover as Mr. Justice James said,2 ... "there is a real danger to be met when one seeks to construe a word in one statute by r:ference to the contstruction given to the same word in a different statute dealing with a wholly different subject matter". It is surprising that the learned judge then immediately. proceeded to adopt a course similar to that he warned agamst, by referring to Lord MacNaghten's observations on the meaning of the words "stored or kept" in Thompson v. Equity Fire Insurance Co.3 In fact Mr. Justice James decided that petrol in a tanker parked on the forecourt of a shop for four hours, in order that Petrol might be sold to the public directly from it, was "kept" ther~. Choosing to be guided by Lord MacNaghten, he came to this decision because he thought the three essential elements of "keeping" were present in this case. There was an element of c?nsiderable quantity-2,500 gallons; an element of duration-four hours, and an element of trade. It is difficult to see the relevance of the 2,500 gallons capacity of the tanker to this question. Section I (I) of the Petroleum (Consolidation) Act, 1928, clearly contemplates the "keeping" of petroleum-spirit in small quantities, as an exception from the requirement of the subsection is made for particularly small quantities kept in vessels with a maximum capacity of a pint and in an aggregate amount of not more than three gallons. Are we to assume that quantities of spirit of more than three gallons may not be regarded as "kept" within the meaning of the subsection because they are not "of considerable quantity"? It is equally difficult to see the relevance of an element of trade. Again, Section 1(1) of the Act of 1928 refers to"petroleum spirit kept either for private use or for sale"; and Regulation 1(1) of the Petroleum-Spirit (Motor Vehicles, etc.) Regulations, 1929, refers to the "keeping and use of petroleum spirit .... not either wholly or partly for the purpose of sale". The element of duration is a different matter. It appears to be a commonly-held view that a degree of permanence is essential to the notion of "keeping" in this context. In this light the acceptance of a period of four hours may be regarded as somewhat liberal interpretation of "duration" or "permanence". Certainly, those who advocate the licensing of commercial spraying booths and the like may still derive some comfort. I think the element of duration should be of minor significance. It seems to me that there is a more logical approach to the problem than the one which seeks to ascertain certain essential "elements" in the notion of "keeping". The verb "to keep" has at least eighteen different meanings; it is reasonable to suppose that Parliament cannot have intended them all to apply in this case; which meaning or meanings, having regard to the clear purpose of the legislation, seem the most appropriate? I believe that the most appropriate meaning is to "have possession, control or charge of". The Court in Grandi v. Milburn became involved in the question whether spirit could be "kept" and "conveyed" at the same time. It ruled in the affirmative. In my experienc"'· enforcement officers sometimes pose the q uestion--can sp:; 1~ be "kept" and "used" at the same time?-and, in my opinion, once again, the answer should be in the affirmative. In the sense I have put forward, "to keep" is a different kind of verb from "to use" or "to convey"; the two latter describe an operation or activity, the former describes the relationship between the object and the external world. In other words, "kept" does not mean "stored" in this context. I cannot see why, if Parliament had meant "stored", it should not have said so. The interpretation of the word "premises" is a simpler problem. In everyday language "premises" means "buildings", or, at least, "buildings and surrounding land". In legal language, it means "any land, whether built upon or not, capable of being conveyed or transferred at law". Which meaning should be applied in Section I of the Act of 1928? I incline to the latter meaning, although this tends to be contrary to the accepted rule of statutory interpretation. I dislike the prospect

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of a person being entitled to keep many gallons of spirit on an open site in a built-up area with impunity, simply because there are no buildings on his land.

The Petroleum Spirit (Motor Vehicles, etc.) Regulations 1929

As, I suspect, do many others, I find difficulty in construing these Regulations to my satisfaction. My attention was first really drawn to them by the curious fact that many licensing authorities (a) issue licences for car parks in buildings, and (b) apply the Regulations to garages in private dwellinghouses, although several Counsel have advised against both.

Before turning to the Regulations, I think it is useful to attempt to determine whether the licensing system applies to premises in which are situated vehicles or engines containing spirit in their fuel-tanks, such spirit being the only spirit in the premises. Certainly a vehicle parked in premises is"kept" there, and certainly the spirit is "kept" in the vehicles. If vehicles are "kept" on premises, and spirit is "kept" in the vehicles, does it follow that the spirit is "kept" on the premises? Or is the better argument that it is only the vehicles which are "kept", and not their contents? I think it is consistent with my view that "kept" is used in the Act in a status-defining rather than an activity-defining meaning to support the former argument.

Thus, in my view, unless the fuel tank holds less than one pi~t of spirit, the premises where a vehicle is parked require a licence, unless the Regulations grant exemption. Regulation _1(1) ~ants an exemption where spirit is kept "by persons mtendmg to use if for the purpose of any motor vehicle, motor boat or aircraft", or of any specified class of engine "and not wholly or partly for the purpose of sale". '

The first point to appreciate is that exemption is only gr~~ted wh_ere it is the same person who is both keeping the spmt an?. mtendi~g to use it. Clearly, this would normally cover spmt kept m a private garage, but what about a car park? In that case, clearly the driver of the car intends to use spirit, but who "keeps" the spirit whilst the car is in the car park, the driver or the proprietor of the car park? In the usual case, I incline to the view that the driver "keeps" the spirit. He who "keeps" the car, "keeps" the spirit in the tank. One would normally talk of the driver "keeping" the car in the park, not !he proprietor. Therefore I think that the ordinary car park Is exempt from licensing. In unusual cases, for example long-term airport car parks, it might be proper to talk of the proprietor "keeping" the car, and so I think that in these cases there would be no exemption. . Wh~t about cars kept for sale in a showroom with spirit m their ta.n~s? If the dealer intends fo! the spmt, then there will be no to charge the purchaser exemption, as the spirit will be kept for the purpose of sale. If he- intends to give the pur~haser the spirit, there will again be no exemption unless he mtends to use the spirit, for example, to move the car around the showroom, before the sale of the car.

A~ exemption is usually thought of as conferring a privilege, but 1t should be appreciated that this is not always the result. Two consequences flow from an exemption under Regulation H.1 ). The first is that the spirit must be kept in accordance with the Regulations, and it is conceivable that these may be more burdensome than conditions imposed on a licence; and the second is that it is only persons intending to use spirit who may apply for a licence which will exempt them from the exemption4 ! This has important consequences. For, if a car park, for example, is exempted from the licensing system,

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only the drivers who intend to use the spirit in the cars can apply for a licence and not the proprietor. In other words, the proprietor of an ordinary car park cannot obtain a licence, and must see that the Regulations are complied with.

I anticipate that an objection at this stage may be based on a reference to Regulation 6, which prohibits the keeping of more than 60 gallons of spirit at the same time in any one storage place, including spirit contained in fuel tanks. It may be claimed that, if one adopts the usual practice of assuming that the fuel tank of a car contains, on average, three gallons, and if one accepts my argument that a car park cannot be licensed by the proprietor, this means that no car park must contain more than twenty cars.

But this presupposes that a car park is a storage place. Regulation 14(2) defines "storage place" as including "any room building or place of any kind whatsoever, whether. or not in the open air, used or proposed to be used for keeI?mg therein petroleum-spirit for the purposes of any motor vehicle, motor boat, aircraft or engine". This is an inclusive, not a~ exhaustive definition. Therefore, one first of all takes the ordinary meaning of the phrase. In the context of the keeping an? use of spirit for motor vehicles and the like, I would submit that this ordinary meaning would not include car parks, garages or showrooms. These are storage places for vehicles, not for the spirit which powers them.

Secondly, one attempts to determine how far the ~efi~ition extends the ordinary meaning. I think the key phrase is, _u~~~ or proposed to be used for keeping therein petroleum-spmt · Is an ordinary car park, garage, or showroom used o~ pro-posed to be used for keeping spirit therein? M~ a~swer is yes, if spirit is kept or proposed to be kept there111 1r: drums or other containers· no if spirit will only be kept m the fuel tanks of vehicles'. I dontend that a thing can be incidentally "kept" in a place, without that place being "used or proposed to be used for keeping" it there. A car park, garage or ~~owroom is ordinarily used only for keeping vehicles, not spmt.

Taking this view, I think it is incumbent on me to attempt to explain away the decision in Appleyard v. Bangham5 . In this case an old stable had been converted into a garage for three m~tor cars with dwelling rooms over it. There was ~o spirit in the garage except in the fuel tanks of the cars, and 111 a container on one of the cars. It was held that the garage was a "storehouse" within the definition contained in the Regula-tions made by the Secretary of State in 1907 Ufl:der the_ Locomotives on Highways Act, 1846. The Regulations sa1~ ~hat "the expression 'storehouse' shall mean any room, bmld1~!?· coach-house, lean-to or other place in which petroleum spmt for the purposes of light locomotives" (wh!ch inclu~t;d motor cars) "is kept in pursuance of these regulat10ns . · · · .

It should be noted that this definition was exh<l;ust1ve, and not inclusive, as in the 1929 Regulations, Mr. Justice Scrutton pointed out that the 1907 Regulations (as do the 1929 R~gulations) clearly contemplated that spirit might be_ kept m a storehouse in the fuel tank of a vehicle as well as 111 separ~te containers. He also adduced the argument that a motonst "keeps" his car in the garage, and so also "keeps" the contents of his car in the garage. Therefore, spirit in the tank of the car was "kept" in the garage for the purpose of the car and the garage was a "storehouse".

If J may respectfully say so, l agree with the decisio_n. Bt!t the vital distinction between the two sets of Regulations 1s that for a garage to be a "storehouse" it was necessary for spirit to be "kept" there, whereas for it to be a st~ra~~ pl_a?e it must "be used or proposed to be used for keepmg spmt.

The 1929 Regulations replace the 1907 Regulations, and, in a_cc~rdance with the ordinary rules of interpretation, some ~igmficance should be attached if possible to the added words 1 ~ t~e new Regulations. It may be argued that the only true di_stmction is that the new Regulations were framed to deal with future use as well as present use. I cannot accept this. In the first place, a simpler elaboration of the original phraseology for this purpose would have been "is kept or proposed ~o be kept". Secondly it only makes sense to cover future use if_an element of intention or design is to be included; other~ise covering existing situations is quite sufficient. The keep~n~ of the cars themselves, or of spirit in separate containers, is mtentional or voluntary, but the keeping of spirit in the fuel tanks is unintentional, involuntary, or of necessity only. _I think it is pertinent to note the comments of Mr. Justice ~idley

in Appleyard v. Bangham on the I 907 Regulations:

I do not think that anyone who framed and drew up these regulations ever thought that they would be applied to the state of circumstances we find here, or intended them to be so · · .. " Although Mr. Justice Scrutton did not agree with these sentiments, was this a lesson which had been learned by 1929?

The operation and enforcement of the licensing system _Once again, it is surprising how little decided law there is on this topic. The lawyer is obliged to resort to analogies drawn from established principles of law in similar but more fruitful fields of legal activity, for instance, planning law. However, ~his is a legitimate pastime for lawyers, as it is often indulged 111 by the courts themselves, as in Grandi v. Milburn.

In section 2 of the Act of I 928, a distinction is made between ~rovisions for duration and renewal (subsection 2) and conditions which may be attached (subsection 3). As section 3(1) refers specifically to conditions, it seems to me that no appeal lies to the Home Secretary if an applicant is dissatisfied with the provisions for duration and renewal. If, for example, he thinks that the period of the licence is too short, his only remedy would appear to be to fail to apply for a new one, and to hope that the magistrates will sympathise and give him a discharge if prosecuted for keeping without a licence.

Nevertheless, authorities should take care in framing provisions for renewal. I have known such a provision to be so framed that it has at least been arguable that, when the old licence expired, if the applicant had observed the old conditions, the authority had no option but to issue him a fr~sh licence with the same conditions, even though they wished to impose fresh conditions.

Conditions must relate to the storage, premises, facilities '.0 r testing, or safe-keeping of the spirit. On general principles, ~t may be that a condition which does not relate to one of these items, or which does so relate but is unreasonable, may be legally invalid and unenforceable although there has been no appeal to the Home Secretary. For instance, magistrates may rule that a condition is invalid if there is a prosecution before them. It may be that a condition would be regarded as unreasonable and therefore invalid if, although it related to one of the matters mentioned above, it referred to premises other than those occupied by the applicant. If an authority felt the regulation of such other premises were required, the only Proper course might be for it to defer or refuse the application.

If a condition is invalid, does this render the licence invalid? In planning law, there has been an attempt to say that it depends on whether the authority would have granted the Permission if it had known at that time that it could not impose the the invalid condition. This involves the body pronouncing upon validity trying to put itself in the place of the authority issuing the licence. I think the law should be that the licence is invalid in all cases, and the authority should be compelled, if necessary, to re-consider the application.

As the right of appeal to the Home Secretary against the refusal of, or the conditions contained in, a licence is cast in very general terms, it seems clear that appeals to him may be on matters of fact, law or policy or any combination of the three. This is not to say that the Home Secretary need necessarily be the final arbiter in law. A dissatisfied applicant has only ten days (or such further time as the Secretary may allow) after receipt of the certificate of the grounds of the authority's decision within which to appeal, but I have already mentioned the way in which magistrates may become involved, and moreover the Act does not state that the decision of the Home Secretary shall be final and binding. It seems likely that the High Court might become involved in one of the three waysby an appeal from a decision of the magistrates; by an application for a declaration, injunction or prerogative order against the local authority by a dissatisfied applicant who ignores his right of appeal to the Home Secretary; or by a similar action against the Home Secretary as a result of his conduct of an appeal.

Assuming that the local authority is not at fault the remedies available to it against breakers of the law are not excessive. There is no power to revoke a licence; but there should always be a provision in a licence that the right is reserved to refuse to renew it if a condition is broken by the licensee. To the best of my knowledge, it has never been established whether "mens rea" is essential to an offence under Section 1 (2) of the Act-in other words, whether it is necessary to prove that the occupier knew or ought to have known that spirit was being kept on his premises or that a condition was being broken. On general principles, it is probable that it is so necessary.

This leads to another difficulty, which is that it may not always be the occupier who is morally responsible for, in particular, a breach of some condition in the licence. An employee who contravenes a condition set out in a notice posted in accordance with section 2(4) can be prosecuted in his own right, as it were, but otherwise the culpable person can only be prosecuted, if at all, for aiding and abetting an offence by the occupier or employee. To obtain a conviction for aiding and abetting, it is necessary to prove that the aider and abetter knew all the circumstances of the offence, including the fact that he was breaking a condition in the occupier's licence. The occupier may have been entirely ignorant of the circumstances of the breach, and the law is now in a state of some confusion as to when the knowledge of an employee can be imputed to the master. It is doubtful whether an aider and abetter can be convicted without an offence by the occupier having been first proved. Thus it is conceivable that, for example, a petrol pump attendant can connive at a serious breach of a condition by a customer without the authority being able to prosecute anybody.

The problem is not the same for a breach of Regulations made w1der the Act, for the Act provides that anyone who contravenes the Regulations commits an offence.

It is interesting to speculate on what might happen if a local authority were guilty of an offence under the Act or Regulations, for, on general principles, it is quite clear that local authorities are bound by the Act, and thus many authorities are obliged to issue licenc~s to themselves. It

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