Private hire apps are legal: R (UTAG) v TfL & Transopco UK Ltd

Cases

The phrase “plying for hire” consists of 3 words. In the first case on its meaning to come before the Court of Appeal since the phrase was enacted 150 years ago, the Court has construed it definitively. Practitioners may be relieved to learn that in doing so the Court upheld long-standing orthodoxies.

The background is that the Metropolitan Public Carriage Act of 1869 established the exclusive right of hackney carriages to ply for hire. This meant that hackney carriages alone could pick up passengers off the street, or be hailed on the street, without any pre-booking. However, the Act did not affect the right of individuals to visit a jobmaster’s yard and hire a horse and carriage privately. Over succeeding decades the jobmaster became the operator, the horse and carriage segued into a motor car, the telephone replaced the visit to the yard and cab radio systems allowed operators to maintain contact with their vehicles wherever they might be. Then, Parliament legislated to licence private hire vehicles (PHVs) outside London through the Local Government (Miscellaneous Provisions) Act 1976 and within the Capital through the Private Hire Vehicles (London) Act 1998. By those dates, the private hire industry was operating across the land, in parallel with hackney carriages.

The current issue was brought to a head by the development of the private hire app, which enables the customer to order a PHV through the operator quickly and efficiently on their mobile phone. Some also enable customers to view anonymised outlines of PHVs in the locality with estimates of how long it may take a vehicle to arrive if a booking is made.

In Reading Borough Council v Ali [2019] 1 WLR 2635 the Council prosecuted an Uber driver parked lawfully by the roadside awaiting a booking through the Uber app. The prosecution failed at first instance, but the Council appealed to the Divisional Court, alleging that the display of the vehicle’s outline on the app amounted to plying for hire. The Divisional Court applied the principles in Cogley v Sherwood [1959] 2 QB 311, namely that plying for hire involves exhibition plus solicitation. It held that the vehicle was not exhibited. Nothing about the vehicle stated “I am for immediate hire”: the outline on the app simply provided information to the customer as to whether there were vehicles in the locality of the sort that had been given out by telephone for decades. Nor was the vehicle engaged in solicitation. It was just waiting innocently by the roadside for a private hire booking as it was fully entitled to do. Anyone purporting to step in would be told they could not do so, but would have to make a booking through the app.

That was not that, however.  A hackney carriage trade association, United Trade Action Group (UTAG), remained dissatisfied with the ruling in Reading v Ali. It judicially reviewed the decision of Transport for London (TfL) to grant a licence to Transopco UK Ltd, which operates the FREE NOW private hire app. In argument before the Divisional Court it was forced to concede that the facts were materially indistinguishable from those in Reading v Ali. The Court dismissed the application for judicial review on this “plying for hire” issue, holding it was bound to follow that decision.

And so UTAG took its case to the Court of Appeal. The essence of its argument was that Reading v Ali was wrongly decided, and that all that is needed for plying for hire is that a driver turns on their app or drives around in search of bookings. It relied on earlier authorities, which had been discussed and discounted in Cogley and/or Reading, to the effect that exhibition is not the touchstone of plying.

FREE NOW argued that private hire drivers are not required to dematerialise between bookings. They can go anywhere other drivers are entitled to go. Furthermore, the operator is entitled to convey to the customer the whereabouts of PHVs in the locality. Such information can be conveyed orally and textually – it does not become unlawful that it is conveyed graphically.

The Court of Appeal resolutely disagreed with UTAG’s arguments and preferred the arguments advanced by FREE NOW and supported by TfL. Approving the long-standing authority of Cogley v Sherwood it held that plying meant exhibition plus solicitation. To the argument that a vehicle plies for hire if it “drives around or parks in a public place waiting for someone to hire it”, it held that cannot possibly be enough. Such a test, it said, would criminalise almost the entire PHV industry.

Bean LJ, with whom Singh LJ and Phillips LJ agreed, stated:

45.         I agree with the Divisional Court in Reading BC v Ali that plying for hire requires a vehicle to be not just exhibited or on view but, while exhibited, to be soliciting custom in the sense of inviting members of the public to hire it without a prior contract. I do not consider that drivers of PHVs using the FREE NOW app can be said to be plying for hire. Neither the “exhibition” nor the “solicitation” element of the test is satisfied.

UTAG’s application for permission to appeal to the Supreme Court was refused, and they were ordered to pay both TfL’s and FREE NOW’s costs.

The full judgment can be read here.

Philip Kolvin QC and Ronnie Dennis of 11KBW acted for FREE NOW, instructed by Mark Rondel of EMW Law LLP.