United Trade Action Group Ltd (R on the application of) v Transport for London

Under the Private Hire Vehicles (London) Act 1998, a licensed operator accepting a private hire booking must undertake, as principal, a contractual obligation to the passenger to provide the journey. The operator cannot avoid that obligation by treating itself merely as the driver’s agent.

A private hire vehicle displayed through a smartphone booking app is not thereby plying for hire where the customer must make a prior booking before the vehicle and driver are identified and the journey is accepted. The Divisional Court’s decision in Reading Borough Council v Ali was binding and indistinguishable. Although the operator’s existing contractual model was unlawful, quashing its licence would have been disproportionate where compliance could be achieved by amending the terms.

The proceedings comprised a Part 8 claim by Uber London Ltd, supported by Transopco (UK) Ltd trading as Free Now, and a judicial review claim by United Trade Action Group Ltd. The Part 8 claim sought a declaration that the 1998 Act did not require an operator accepting a booking to contract with the passenger as principal.

The judicial review challenged Transport for London’s renewal of Free Now’s operator’s licence. The challenge alleged that Free Now’s contractual terms unlawfully made drivers, rather than Free Now, accept bookings, and that drivers using the app unlawfully plied for hire under the Metropolitan Public Carriage Act 1869. The central questions concerned the statutory contractual responsibility of an operator, the application of plying-for-hire principles to app-based bookings, and the appropriate remedy.

1. Operator responsibility. The language and purpose of the Private Hire Vehicles (London) Act 1998 require an operator accepting a booking to enter, as principal, into a contractual obligation with the passenger to provide the journey. Section 4’s reference to vehicles and drivers available to the operator for carrying out a booking, and section 5’s express references to the contract between the operator and passenger, support that conclusion. The distinction between accepting a booking and undertaking the obligation to carry out the journey was illusory.
2. This construction furthered public safety. Passengers may be vulnerable and may otherwise have only a practically worthless contractual claim against an unknown driver. Section 56(1) of the Local Government (Miscellaneous Provisions) Act 1976 supported the same parliamentary intention, although the statutory language differed.
3. Plying for hire. The court was bound by Reading Borough Council v Ali. A vehicle shown on an app was not unlawfully plying for hire where the customer had to make a prior booking, the specific vehicle was identified only afterwards, and the driver was waiting for an app booking rather than soliciting members of the public. The contractual identity of the person with whom the eventual contract was made was immaterial to that issue.
4. Remedy and consequences. Free Now’s existing model did not comply with the 1998 Act, and TfL would need to reconsider its practice of not reviewing operators’ contractual terms. Nevertheless, quashing the licence was disproportionate because Free Now undertook to amend its terms and many drivers depended on the app for their livelihoods. The court also observed that TfL should consider whether contractual exclusions of liability were compatible with the statutory purpose.
5. The court granted declarations in both proceedings that a licensed operator accepting a booking must contract as principal with the passenger to provide the journey. The judicial review claim was otherwise dismissed.

First instance decision. The judgment records no prior appellate stage for these proceedings.