Council loses its appeal in landmark High Court taxi licensing fees case

Wakefield Council have lost its appeal on a High Court case centring around taxi licensing fees, which could now cost UK councils millions.

The potential landmark appeal ruling supported the High Court in its decision to quash the licence fees charged for private hire vehicle and hackney carriage licences set by Wakefield City Council. This came following a claim for judicial review by the Wakefield District Private Hire and Hackney Association.

The judicial review was brought by the Wakefield District Private Hire and Hackney Association (WDPHHA) after the council hiked up the cost of a licensing badge this year by 60 per cent to £384.

In the original High Court case last year in December 2018, his Honour Judge Saffman, sitting as a deputy judge of the High Court, held that the fees charged by Wakefield were unlawful.

According to licensing lawyer, Gerald Gouriet QC, who represented the Wakefield District Hackney Carriage and Private Hire Association in the case: “The Council had wrongly interpreted section 70 of the Local Government (Miscellaneous Provisions) Act 1976 and had erroneously charged the costs of enforcement against drivers (for speeding, bad parking, dressing inappropriately and a miscellany of uncivil or illegal conduct) to the control and supervision of vehicles.

“Wakefield’s case had been that the costs were properly accounted for against vehicles because the errant drivers were driving vehicles. The learned judge described that as ‘stretching beyond breaking point’ the language of the section.”

Gouriet went on to say back in 2018 after the High Court ruling: “The case is of wider importance as it dispels any suggestion that there is a general principle of law that licensing regimes should be self-financing.

“The judge made it clear that a local authority’s entitlement to recover from the licence fee the costs of administering a licensing regime is governed by the words of the empowering statute.

“Where Parliament has awarded local authorities a broad discretion to set such licence fees “as they think reasonable”, the courts have upheld policies of full cost recovery on the  ground that the policies, being reasonable, are intra vires; but where, as in s 70 LGMPA 1976, the power to charge a fee is circumscribed by reference to specific heads of recovery, recovery is restricted to those specified heads. Licensing authorities are creatures of statute, and have no powers beyond those which statute has given them.”

Fast forward to December 2019 and Wakefield Council had argued in the High Court and again in the Court of Appeal that “it is a principle of law” that licensing schemes ought to be self-funding rather than being reliant on a local authority’s general funds raised from its council tax payers.

The High Court (HH Judge Saffman) was not persuaded there was any such principle; and the Court of Appeal dismissed the council’s appeal against his decision.

Because of the ruling, Wakefield Council could now face a humongous bill to reimburse all taxi drivers backdated to 2004.

Wajid Ali, co-chairman of the WDPHHA, told Wakefield Express: “We are of course very pleased that the Court of Appeal agreed with us and the High Court.

"We hope now the law has been clarified, the council will agree to meet with us to discuss how the council can refund the monies it has overcharged vehicle

owners to avoid further court action."

Charles Holland, licensing barrister who also appeared for WDPHHA, said: “This is a welcome judgment. It hopefully puts to bed the suggestion that somehow drivers do not have to pay for the costs of enforcing driver conduct (an exercise from which they, as a group, benefit) and that these costs should fall on the ratepayer.

“It is a decision which does not just correspond with common sense, but which also derives an attractive purposive and high-level approach to statutory interpretation in this regime. It is often the case in the taxi sector that particular sub-sections will be picked over in an attempt to pursue the narrow objectives of certain sections of the trade, with the trees (or individual branches of the trees) being focused on to the detriment of the wood.

“The Court of Appeal has confirmed that, on the interpretation of this particular Act, the funding relates to the wood, and particular branches do not come free.”

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