Small business wins High Court battle against Milton Keynes Council over refusal of Covid grant during lockdown
The company was refused business rate relief and a grant
A small fashion retail company has won a High Court battle against MK Council after it was refused financial help during the Covid crisis.
Cava Bien Limited, based on Blakelands industrial estate, applied to the council for a small business grant and business rate relief at the start of the pandemic.
The total aid would have potentially been worth tens of thousands of pounds out of cash the council had been allocated by the Government specifically to help local businesses struggling due to Covid restrictions.
But the application was refused - on the grounds at MK Council did not believe the Blakelands unit had been occupied or used for in-house trading, High Court deputy judge Kate Grange QC heard.
Çava Bien, which sells its own brand of women fashion collections globally, insisted it was in occupation from November 2019 and was fully operational until March 2020 when the coronavirus lockdown restrictions took effect.
However, the council's Business Rates team leader Mr Robert Hayle disputed that the premises was being used at all.
In documents submitted to the court, he said grants were only applicable "to occupied properties that are reasonably accessible to visiting members of the public". He said the council had the property listed as unoccupied and had inspected the property 11 times (and had nine letters returned) with no sign that the property was occupied.
Photographs taken by inspectors showed the premises seemingly empty, the court heard.
He also told the company in an email, which was submitted to court: "If the property is occupied, it is not reasonably accessible and therefore, unfortunately you are not entitled to the grant scheme."
Cava Bien claimed MK Council erred in law when it rejected its applications.
The judge heard that Cava Bien director Ibrahim Oluwakemi replied to the council at the time: "It seems to me you are making a lot of assumptions. Your assumption that we are an online business is wrong. We are not an online pure-play business. Though we have an online presence, we do not only sell through the internet. We trade both in house and online just like many other businesses do.
"Members of the public can come into our property, browse a variety of our stock and services, and make a purchase of our goods and services. Some customers take away their purchase or service, while other customers place orders, which are then delivered to the customer... Other members of the public don't have a problem accessing our building; we can't speak for your inspectors."
Mr Oluwakemi claimed in court that number of the council's letters had been wrongly been sent to the company's London office and not the Milton Keynes unit.
He said he took on the lease for the Bringewood Forge unit in 2016 but due to a burglary of most of the retail stock, could not start trading as planned. He was provided with a six month business rate relief, which ended in September 2016,
"Due to some challenges with the business and funding, the property remained unoccupied until March 2019 when I began to get the property ready for trading. In November 2019, the business began trading..." his statement read.
The judge criticised the council's inspection report from December 2019, saying it was of "extremely poor quality", as well as "unhelpfully brief" and providing "little useful information to the decision-maker".
She said: "That leads me to the conclusion that some of the inquiries which were conducted by the Defendant (MK Council) itself and which were being relied upon at the time were flawed and provided no proper information to any decision-maker."
The judge admitted it was "a difficult case" in which to disentangle the unlawful conduct complained of from the other circumstances of the case.
But she said there was too much uncertainty about the outcome and for that reason the council's decision should be quashed.
"The defendant can take the decisions again, properly directing itself as to the fact of the claimant's occupation at the relevant time," she said.
"Accordingly, I allow the claim for judicial review and remit the matter back to the defendant for the decisions to be retaken," she concluded.