Court of Appeal considers fines for unauthorised works to a listed building

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In a judgement published this week, the Court of Appeal has considered the basis on which fines should be imposed when breaches of listed building and planning enforcement notices occur. The case (R v Western Trading Limited) concerned the replacement of timber shop fronts with painted metal shop fronts and roller shutters on a Grade II listed Victorian commercial building in Birmingham. A prosecution was brought when the defendants’ appeal against a listed building enforcement notice and planning enforcement notice was unsuccessful and the notices were not complied with in over three years.

The prosecution was brought against both the company, which was the registered freehold proprietor of the of the listed building, and its sole active director. The company and director were each ordered to pay a fine of £25,000 plus costs following their conviction.

The Court of Appeal was asked to consider whether the fines had been correctly calculated having regard to the defendants’ guilty pleas and previous good character, and the fact that the works required by the notice had been undertaken in a deferral between conviction and sentence. The actual cost of the works required by the notice was in excess of £60,000, however, it was estimated that if the works had been undertaken promptly, the cost would have been between £25,000 and £30,000.

The trial judge had indicated that the starting point for the fines was £40,000 without justifying this sum. Although guidance is available in primary legislation, case law and Sentencing Guidelines, there is no mathematical formula for arriving at a starting point for a fine in this type of case. The guidance available emphasises the need for a fine to punish, deter and remove any financial gain derived through non-compliance. The Court of Appeal found that as a result of the ‘attempt to avoid the cost of compliance’, notwithstanding the lower cost had the works been undertaken promptly, together with ‘obdurate disobedience to the notices for a period of over three years’ provided ‘ample justification’ for the judge’s starting point.

The reduction of the fines from £40,000 to £25,000 as a result of the defendants’ guilty plea and their previous good character was also found to be justified in view of the late stage at which the pleas were entered and the remediation works were carried out. The Court approached the question of apportionment of the fine between the defendants by firstly considering the financial gain the company may have achieved and secondly considering its culpability before considering the appropriate penalty for a director who was the controlling mind of the company and caused it to commit the offence. In the circumstances of the case, the Court found that the apportionment of the fine between the company and its director was justified. The defendants were ordered to pay the planning authority’s costs of the appeal.

This case is a helpful reminder of the potentially severe penalties which may be imposed in planning enforcement cases where owners do not act promptly or work pro-actively with the planning authority to remedy the breach of planning control. The case also serves to highlight the personal liability which may be placed on directors of companies.