The perennial question of whether occupation of land is pursuant to a lease or a licence has been explored recently in a most unusual case involving the allocation of pitches at a fair.
The case is Holland v Oxford City Council (2016). The occupation in question related to two pitches at St Giles Fair, an annual fair held in Oxford city centre. The claimant, Mrs Holland, was a fairground ride operator who was complaining that she had been unable to bring a large ride called the 'Cyclone' to the fair due to the two pitches being reduced in size by the Council and a complaint of encroachment from an adjoining operator. This had resulted in loss of income. She applied for a court declaration that she had an annual periodic tenancy of the pitches and for damages for breach of covenant. The Council claimed she had only a licence, which was issued every year. This would mean that she could not assert a right to occupy any particular area at the fair.
The court had to consider how the fair was organised, which makes for fascinating reading. Pitches at the fair were allocated by the Council on application each year from ride operators. In allocating pitches, the Council generally followed 'Guild rights' - rules created by the Showman's Guild under which a Guild member who has a particular site at a particular fair is entitled to priority over that site each year. On application for a pitch at St Giles Fair, operators were issued with a letter of authority, Conditions of Letting and charged a fee based on the size of the ride. Mrs Holland had used the same two pitches at the fair for a number of years under this procedure.
The Conditions of Letting included a condition that the allocated pitches were subject to any road signs, lamps or other street furniture and restricted the use of the pitch to the operator, or its family, business partners or associated company. They also provided that failure to comply could result in the removal of all equipment, suspension, or prohibition on using the site. There was no right of re-entry or right for the Council to enter onto the pitch.
The crucial questions for the court to answer were:
- Did Mrs Holland have exclusive possession of the site, which was a pre-requisite to a tenancy arising?
- Did the arrangements between Mrs Holland and the Council create a periodic arrangement, such that she had the right to use the pitches for each fair or did a fresh occupancy agreement arise each year?
The judge looked at the Conditions of Letting and the arrangements between the parties. He decided that the determining factor was not the amount of control the Council had over the pitches, but whether the Council could access the pitches at any time at will. The amount of access that the public had to the pitches was also irrelevant to the question of exclusive possession.
The Conditions of Letting did not reserve a right of access to the pitches for the Council and, therefore, the judge found that it was implicit that none was required. The judge held that this demonstrated that the Council intended that it should have free access to the pitches. This meant that Mrs Holland was a licensee only. The fact that some of the correspondence and documentation used words such as 'tenancy' and 'let' did not change the status of her occupation.
The judge recognised that Mrs Holland might have acquired a periodic licence, entitling her as a matter of contract to a licence each year at the fair. However, the annual application and allocation process for pitches at the fair suggested otherwise. She was held to have a licence to use the pitches granted afresh each year. Her entitlement to use the pitches under Guild rights did not change the legal position.
The case demonstrates that where parties wish to create a licence arrangement, it makes sense to ensure that it does not contain provisions such as rights reserved to the landlord, or a right of forfeiture, that suggest a grant of exclusive possession.