In what is thought to be the first case of its kind since the Deregulation Act 2015 came into force, Milton Keynes Council recently brought legal action against a private hire operator who the council said was not licensed to operate in Milton Keynes.
The legal action started from a complaint that Milton Keynes Council received from a passenger who uses the train from Central Milton Keynes Station and regularly uses a local private hire operator (Skyline MK). On 3 April 2015, the complainant telephoned Skyline MK on a Milton Keynes number. As a regular customer, he spoke to the automated system, and made a booking for a minicab (or private hire car) to pick him up the following morning at 6.50am, and take him from his home to the station. A car did not arrive on time and he rang Skyline shortly after 6.50am to tell them so. A minicab, registration mark MA60 WGK and driven by a Mr Muhammad Sabeel, arrived at 7.17am. The complainant was understandably annoyed, and he complained to the Council.
The investigation by the council into that complaint revealed that, although Mr Sabeel and his vehicle were licensed by South Northamptonshire District Council, he was not licensed by Milton Keynes Council.
The council consequently sought to prosecute Skyline MK and Mr Gavin Sokhi (director of Skyline) for operating a vehicle as a private hire vehicle for which a vehicle licence issued by Milton Keynes Council was not in force, driven by a driver who was not licensed by the council.
The case was heard before District Judge Dodds at Milton Keynes Magistrates’ Court sitting at High Wycombe on 25 May 2017. The council argued that Skyline MK (licensed by it) did not properly sub-contract the booking to Skyline SNC (licensed by South Northamptonshire District Council) and therefore an offence was committed. Skyline’s defence was that Skyline MK had made an arrangement for Skyline SNC to carry out the booking and Skyline SNC, Mr Sabeel and his vehicle were all licensed by SNDC therefore fulfilling the requirement that all three licences – the driver, vehicle and operator – were in place.
Dodds JD found that there was no case to answer, because the council as prosecutor had failed to show, to the criminal standard of proof, that the booking had not been “sub-contracted” or “transferred” to Skyline SNC.
Milton Keynes council appealed the Magistrates’ Court ruling in the High Court. Apart from a number of technical arguments relating to costs, the crux of the appeal related to the means employed by Skyline when sub-contracting the fare.
Deregulation Act 2015
Prior to the commencement of the Deregulation Act, out of district sub-contracting by private hire operators was not permitted. Since 1 October 2015, this changed with the commencement of the Deregulation Act. Under section 55A & 55B of the Deregulation Act, any licensed operator can sub-contract to any other licensed private hire operator on condition that “…the sub-contracted booking is accepted.”
Skyline (both MK and SNC) use the iCabbi system to manage their bookings. The system used advanced voice recognition software that automatically records the details of a booking including the booking time, pick-up and drop off addresses.
A driver and vehicle are not immediately assigned to the job. That assignment is made, by the computer and without any further human intervention, approximately 5-10 minutes before the pick-up time. Available drivers and vehicles that are eligible and available are then identified by the computer system. First, those who are licensed by the same local authority that licensed the operator which accepted the booking are identified. If there is none, drivers and vehicles from an adjacent controlled area where Skyline have an operator’s licence are identified.
Almost every aspect of Skyline’s booking process is automated by the iCabbi system without any human intervention including the “sub-contracting” of the fare.
Milton Keynes Council argued before the High Court that Skyline’s automated process did not comply with the legal requirement of section 55A of the Deregulation Act because when the complainant made his booking over the telephone, Skyline MK “accepted” it.
Counsel for Milton Keynes Council, submitted that Skyline MK did not arrange for another person (i.e. Skyline SNC) to carry out the booking, because Skyline SNC did not know of or consent to the transfer of the booking, but played a merely passive role and to this extend the transfer was the unilateral act of Skyline MK. Insofar as Skyline MK offered the booking at all, their counsel argued that it was accepted, not by Skyline SNC, but by Mr Sabeel, who was contacted direct via the iCabbi computer system to see whether he would take the job and he duly agreed to do so.
Counsel for Milton Keynes Council submitted that, for there to be an arrangement that satisfies section 55A, the second operator has to take a positive decision to accept the booking, which in practice means that, in respect of the particular booking, there has to be some positive intervention on the part of the second operator.
Lord Justice Hickinbottom however disagreed saying that the approach put forward by the council was too simplistic. He said it makes no sense for the same legal entity (Skyline) to have an arrangement with itself to “accept” sub-contract bookings.
More importantly, Hickinbottom LJ said: “I do not accept the proposition that, under section 55A, the first and second operators have to have separate controlling minds. The provisions clearly contemplate a single operator having multiple operator’s licences in different areas; and there is nothing in the legislative scheme to suggest the operation in each area has to have a separate and distinct controlling mind.
“Nor do I accept the proposition that, an overarching arrangement having been set up to be implemented through a computer rather than individuals on telephones, the second operator has to take a distinct positive decision to accept each and every particular booking. Again, such a restriction seems not only out of kilter with modern life (as powerfully submitted by Mr Leigh), but entirely unwarranted by the wording used in the statutory provisions.”
What Hickinbottom LJ essentially said was that regulators need to bear in mind that we live in the 21 century and whilst the primary legislation dates as far back the Victorian times, its application can still be interpreted as being relevant today.
Until the Government is in a position to overhaul and modernise taxi and private hire licensing laws in England and Wales, litigation in this area will become a more common occurrence as the trade and regulators grapple with reconciling out dated legislation in the face of ever increasingly complex technological advances.
Whilst this case was determined on its individual facts, it should nonetheless provide the trade with some comfort that the Courts will take a pragmatic approach to marrying up outdated legislation with modern day life and technology. This case related to private hire operators but it can be the principals established through it can be applied to other areas of the trade such as, for example, the increasing popularity of smartphone apps used to facilitate bookings.
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Taken from the January 2018 PHTM edition. This article was written by Stephen Mccaffrey, Head of Kings View Chambers & Taxi Defence Barristers.
