Articles | Protecting a licence on death or insolvency

Everyone struggling to deal with the aftermath of death, insolvency or mental incapacity of a licensee needs to be aware of the Interim Authority Procedure. Joe Lott explains why.

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Joe Lott

Joe Lott

When a licence-holder dies, becomes mentally incapable, goes insolvent or (in the case of a company) is dissolved, the last thing that the people left picking up the pieces are probably thinking about is contacting the local Council licensing department.  However, all of these situations are automatic triggers bringing the Premises Licence to an end. 

To keep the licence going, it is absoutely crucial that an Interim Authority Notice (under s.47 of the Licensing Act 2003) is served on the Licensing Authority and the Police within a week from the date of the event happening.  If not, the licence lapses and there is no mechanism for reviving it and keeping the premises open.  A brand new licence will be needed, a process which cannot take less than four to five weeks.  In the meantime the premises must close.

For relatives struggling to deal with hospitalisation or a funeral and the licensee's Estate, it is entirely understandable that this kind of thing might be missed, and yet the financial consequences will be devastating at a time of personal tragedy.  For businesses or insolvency practitioners, missing these Notices could have a crucial effect on the ongoing viability of the business, and possible allegations of negligence.

If the Notice is served within that initial week, the premises can continue trading for a further 2 months.  Within that period an application to transfer the licence to a new licensee must be made in the normal way.  This will hopefully provide some breathing-space for the business to find a new landlord/owner.

If the licensee was also the Designated Premises Supervisor, a new DPS will also need to be appointed immediately, as no alcohol sales can be made until that time.