Market Property Rights and the Common Good

Mr Justice Clarke emphasized at the beginning of his discussion and determination in the ’Ennis case’ that, “All property rights guaranteed under the Constitution are subject to legitimate and proportionate regulation in the common good.”

Simmonds & Anor -v- Ennis Town Council (2012) IEHC 281 (10 February 2012)

Discussion and Determination

Section 6.6

“The only aspect of the legislative history which seems to me to have any significant bearing, is the question of the entitlement of local authorities to regulate franchise markets. There is no dispute between the parties but that, at least at the level of principle, and subject to proportionality, it is open to the Oireachtas to confer at least some powers of regulation of a franchise market on a local authority. It would be difficult to see how any other view could be taken. While it may well be appropriate, as counsel for Mr. Simmonds argued, to characterise an established right to trade at a franchise market as a species of property right, such rights are, together with all other property rights guaranteed under the Constitution, subject to legitimate and proportionate regulation in the common good.”

Property Rights, Proportionality and the Common Good

A market right is a property right guaranteed by article 40.3.2 of the Constitution. (see Market Property Rights).

The word ‘Accordingly’ in article 43.2.2 refers to the regulation of property rights by the principles of social justice in article 43.2.1.

Peart J combined both articles together in the case of Shirley v. O’Gorman, IEHC 27 [2006] by stating that a property right may only be limited when the state is pursuing a social justice principle.

Shirley v. O’Gorman, IEHC 27 [2006]

The Exigencies of the Common Good

“It is only where the State is pursuing a social justice principle that it may as occasion requires delimit the exercise of property rights with a view to recoiling their exercise with the exigencies of the common good.

The Proportionality Test

The phrase ‘as occasion requires’ in Article 43.2.2 introduced the doctrine of proportionality that focuses on when and under what circumstances a constitutional right may be limited.

The concept of proportionality is the yard stick used to assess under what conditions rights may be restricted. The ‘means’ by which property rights may be limited are subject to specific legal parameters defined in a ‘proportionality test’.

Shirley v. O’Gorman, IEHC 27 [2006]

“In consideration whether a restriction on the exercise of rights is permitted by the Constitution, the Courts in this country and elsewhere have found it helpful to apply the test of proportionality, a test which contains the notions of minimal restraint in the exercise of protected rights, and of the exigencies of the common good in a democratic society. This is a test frequently adopted by the European Court of Human Rights (see for example Times Newspapers Ltd v United Kingdom [1979] 2 EHRR 245) and has recently been formulated by the Supreme Court of Canada in the following terms. The objective of the impugned provision must be of sufficient importance to warrant overriding a constitutionally protected right. It must relate to concerns pressing and substantial in a free and democratic society. The means must pass a proportionality test. They must:-”

a) be rationally connected to the objective and not be arbitrary, unfair or based on irrational considerations;

b) impair the right as little as possible; and be such that their effects on rights are proportional to the objective.

The Common Good

In terms of the common good Peart J went on to say that:-

Shirley v. O’Gorman, IEHC 27 [2006]

“Constitutional rights should be interfered with, restricted or delimited as little as is necessary for the attainment of the desired social justice objective.”

And,

Of course the Courts enjoy an ultimate supervisory role in ensuring that legislation passed by the Oireachtas is constitutional, but the Courts should be slow to in any way substitute its own view of what may or may not be required in order to reconcile the exercise of property rights with the exigencies of the common good. Until some point of absolute extremity is reached where legislation is patently and manifestly not in pursuit of any possible common good exigency, the Court should abstain from interfering with the role of the legislature in deciding what measures are needed.”

A market property right may therefore only be delimited or restricted if it passes the proportionality test. Such a restriction on the exercise of rights would only be permitted if a point of absolute extremity had been reached that constituted an attack on a social justice principle. The courts are therefore slow to restrict the exercise of a constitutionally protected right in the context of the common good.

Market Rights, The Allocation of Trading Spaces and The Common Good

The judgement in the ‘Ennis’ case states that in circumstances where market rights cover a whole town, a designated casual trading area also has to cover a whole town. (See The Designation of a Casual Trading Area)

When a whole town is designated as a casual trading area the number of possible trading spaces is always going to be greater than the total number of potential applicants for a casual trading licence.

In order to licence casual trading a local authority has to allocate trading spaces to market traders. Trading spaces are therefore mapped, numbered and allocated to traders on each individual casual trading licence.

The Casual Trading Act 1995 provides a local authority with the right to refuse a casual trading licence if a trading space is not available.

Casual Trading Act 1995

Casual Trading Licences.

Section 4(5)(a)(b)(c)

(5) A local authority may refuse to grant a casual trading licence to a person if—

(a) the person fails to furnish a completed application form for a casual trading licence,

(b) the person fails to pay the appropriate fee (if any) with the said application form, or

(c) a trading place for the purpose of casual trading is not available.

(6) A local authority may refuse to grant a casual trading licence to a person who has been convicted of an offence in relation to the importation, possession or sale of goods committed while he was the holder of a casual trading licence or an offence under this Act (other than an offence under section 5 ) during the period of 3 years before the date of application for the licence.

This does not present a problem in a situation where market rights are granted in a specific location, such as a town square.

When the number of applicants is greater than the number of trading spaces in a casual trading area of limited size, a local authority can refuse to grant a licence on the grounds that there are no further trading spaces available.

However, in a situation where a market right encompasses a whole town, the number of possible trading spaces is greater than the number of licence applicants. In these circumstances a local authority is obliged to continue allocating trading spaces to all licence applicants, as there is always a trading space available.

Ministerial Guidelines 2006

Guideline 5.

Filling Vacant Pitches

When a trading space becomes vacant for whatever reason there is an obligation on the local authority to allocate this space to an applicant for a casual trading licence. Under section 4 (5) the only circumstances (apart from persons with convictions under the Act) whereby a local authority can refuse to allocate a space are (a) where the applicant fails to furnish a completed application form, (b) where the applicant fails to pay the appropriate fee and (c) where there is no trading space available. If the local authority wishes to dedesignate any vacant spaces the legal advice is that they should go through the process in section 6 (6) of the Act.

From this three question arise.
1) Could a local authority’s obligation to continue to allocate trading spaces to licence applicants ever lead to a town being choked with stalls?
2) Could this represent an attack on a social justice principle (the proper economic functioning of a town)?
3) Could a local authority limit the exercise of a market property right and refuse to grant a casual trading licence stating that, in the common good, there are no further trading spaces available?

Questions Before the Court in the ‘Ennis Case’

This problem was considered in the ‘Ennis’ case via two questions.

1) Does a local authority’s entitlement to refuse a casual trading licence exist to the same full extent with respect to trading at a franchise market, in circumstances where a franchise market area encompasses a whole town?

and

2) If the public has the right to trade pursuant to a market right, are there implied limitations on the extent to which a local authority can refuse a to grant a licence to an applicant at a franchise market not contained by metes and bounds?

With regard to these two questions Mr Justice Clarke stated in the ‘Ennis’ Case that the size of a franchise market did not, in practice, represent a problem on the facts of the case.

Simmonds & Anor -v- Ennis Town Council (2012) IEHC 281 (10 February 2012)

Discussion and Determination

Section 6.6

“. . . nothing in this judgment should be taken as necessarily deciding that the undoubted general entitlement of a local authority to refuse a casual trading licence where there are not sufficient bays within a casual trading area, necessarily applies to the full extent in respect of trading at a franchise market.As that problem does not, in practice, as I understand it, arise on the facts of this case, it does not seem to me to be appropriate to reach any final conclusion as to the extent to which there may not also be implied limitations on the extent to which a local authority can refuse an established franchise market trader a licence in those circumstances.”

It is apparent that the natural size of a franchise market without specified boundaries does not present an attack on the common good or any social justice principle, such as the proper economic functioning of a town. As the natural size of a franchise market does not reach a point of absolute extremity, the law definitively states that it would be inappropriate to make a decision in this area.

Conclusion

A local authority cannot refuse to grant a casual trading licence to an applicant wishing to trade a franchise market, (not contained by metes and bounds), on the grounds that there is no trading space available.

When a designated casual trading area covers a whole town the size of the franchise market is naturally self-limiting and reflects the number of potential customers, car parking facilities and the carrying capacity of a town. (See ‘The Natural Size of a Franchise Market Without Metes and Bounds’.)

If market property rights could be limited via ‘The Common Good’, such a restriction of property rights would normally involve some form of compensation. As Henchy J indicated in the case of DPP (Long) V. McDonald [1983] I.L.R.M 223:-

If the prohibitions in these bye-laws could be said to apply to a fair or a market, they could be used to cripple or put out of existence, without any compensation, the particular fair or market. And that could be unconstitutional.

Market Property Rights and The Common Good