No requirement for taxi licensing schemes to be self-financing, High Court rules

Wakefield City Council is considering whether to appeal against a High Court ruling that quashed its licensing fees for private hire vehicles and taxis.

Barristers who acted in the case have said it established  there is no general principle that licensing regimes must be self-financing.

The council was taken to judicial review by the Wakefield District Private Hire and Hackney Association.

HHJ Saffman, sitting as a deputy judge of the High Court, held that the fees were unlawful as the council had wrongly interpreted section 70 of the Local Government (Miscellaneous Provisions) Act 1876.

The judge said Wakefield had erroneously charged the costs of enforcement against drivers, for speeding and bad parking for example, 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 them, which the judge described as “stretching beyond breaking point” the language of the section.

Gerald Gouriet QC and Charles Streeten of Francis Taylor Building chambers acted for the association. They said in comments on the case that it was of wider importance “as it dispels any suggestion that there is a general principle of law that licensing regimes should be self-financing”.

This is because 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.

They said courts have upheld policies of full cost recovery where Parliament has given a broad discretion but where - as in s70 LGMPA 1976 - the power to charge a fee is circumscribed by reference to specific heads of recovery, recovery is restricted to those.

The barristers said that during the High Court action it became apparent that Wakefield has overcharged private hire vehicle licence fees by a more than £1m, and this would be the subject of a claim for restitution.

A Wakefield statement said: “Following the ruling at Leeds High Court we can seek permission to appeal directly to the Court of Appeal. This would enable us to appeal against the ruling. “We are considering how we proceed and as this is an on-going legal matter we cannot comment further.”