Environment Agency (Thames Region) v John Bushnell Ltd

When a statutory licensing authority fixes a fair and reasonable consideration for river facilities, it must assess each licence in its statutory context. A general tariff or valuation method may be used, but material differences between facilities must be recognised. Factors bearing on the extent, navigational usefulness or viability of the licensed works must be considered.

Where creek moorings remain usable only because the licensee incurs substantial and recurrent dredging costs, those costs are a material river-related factor. They cannot be ignored as merely a matter of the licensee’s commercial profitability or operating expenses. The assessment must positively take them into account, and the resulting charge may need to be lower than that for comparable mainstream facilities.

The Environment Agency, as statutory successor to the Conservators of the River Thames, claimed unpaid accommodation licence charges from John Bushnell Ltd. The charges related to stages and moorings in the mainstream and in a creek connected with the Thames.

The charges had been assessed by applying a general valuation method based principally on the physical works and mooring length. The assessment did not allow for the substantial and recurrent dredging costs incurred by the company to keep the creek facilities navigable.

His Honour Judge Catlin, sitting in the Reading County Court on 14 February 2000, entered judgment for the Agency. The central issue on appeal was whether the assessment was fair and reasonable under the Thames Conservancy Act 1932 despite excluding those dredging costs.

The appeal was allowed. The Court granted declarations that the basis of assessment was not fair and reasonable and that the relevant assessments had to be undertaken again.

1. Under section 60 of the Thames Conservancy Act 1932, the authority was entitled, and obliged in the first instance, to assess the consideration payable under the express and implied licences. The amount had to be objectively fair and reasonable. The authority’s responsibility could not be delegated merely because it obtained advice from professional valuers.

2. The licensing system operated on an individual basis, although general principles and guidelines could properly be developed to promote consistency. Fair treatment required like cases to be treated alike, material differences to be recognised and unjustified disparities to be avoided.

3. The relevant factors included the extent of the invasion of the river, the extent and navigational usefulness or viability of the facilities, and other river-related effects on navigation or its maintenance and improvement. Matters of general commercial attractiveness or profitability stood on a different footing.

4. The recurrent dredging costs were incurred to keep the creek navigable and the facilities usable. They therefore directly affected the navigational usefulness and value of the licensed works. The refusal to take them into account treated materially different facilities alike and made both the method and the resulting charges unfair and unreasonable.

5. Lord Justice Simon Brown agreed with Lord Justice Mance. He considered that the authority was exercising a public law power subject to Wednesbury principles, but stated that the result was the same under the contractual analysis. The consideration had to be redetermined having regard to the lesser navigational value of the creek moorings.

6. The assessments for the years ending in September 1995, 1996, 1997 and 1998 were remitted to the Agency for reassessment in accordance with those principles. The appellant received its costs in the Court of Appeal and below. Liberty to apply was granted if necessary.

• Court of Appeal (Civil Division): Appeal from the judgment of His Honour Judge Catlin in the Reading County Court on 14 February 2000. Appeal allowed and declarations granted requiring reassessment of the licence charges.