Wednesday, 4 June 2014

Arguments to use if ParkingEye try and use HHJ Moloney's judgment in your case (1/3, Standing)

In a recent well-publicised small claims hearing in Cambridge, ParkingEye v Beavis and Wardley, His Honour Judge Moloney ruled in favour of ParkingEye in both claims

ParkingEye have been sending out the judgment of HHJ Moloney to several ongoing cases The Prankster knows about. So far, they have not said why they think it is applicable, preferring instead just to say they will be relying on it.

This blog post explains why The Prankster thinks this judgment is not useful for the majority of ParkingEye car parks, and gives you arguments you can use if this is raised in your case. The Prankster is in the middle of updating his guides, but this is taking more time than expected and therefore the information is being published here to help motorists immediately.

It may be useful to refer to the judgement in full. The Prankster has hosted a copy here. Exhibit CS020 is the transcript. This transcript has been OCR'ed from the original, and therefore contains small spelling mistakes
and other minor problems.

The first item to bring to the attention of any judge is HHJ Moloney's own warning at the beginning of the transcript.

1.2 I should however emphasise:
a. that since I am a Circuit Judge not a High Court Judge, this decision has only persuasive force;
b. that it is based on one particular set of the Claimant's standard notices and terms, which may have varied from time to time, a point which should be checked in other cases;
c. that although Mr Foster, the Defendants' McKenzie friend, put his case clearly and well, especially in his very helpful written submissions, and although leading and junior counsel for the Claimant were of course conscious of their duty to the Court to inform it of all relevant authorities that might assist either side, still the Defendants did not have the benefit of professional assistance that might in another case produce different arguments and perhaps a different result.
Item 1.2b is likely to be the most helpful in other cases, because the car park in question is operated in a significantly different way to practically all other ParkingEye car parks. For the Riverside Retail Park, Chelmsford, ParkingEye pay £1,000 a week to the landowner (this figure was redacted from the judgment, but mentioned in open court). ParkingEye's 2012/3 accounts show cost of sales to be £2.3 million, which would allow 45 of their 800+ car parks to operate in a similar manner. Thus, the vast number of their car parks operate on a different basis.

Paragraph 1.2c is also important, because it shows that new arguments, not used in that case, may well cause a different verdict. The following analysis therefore presents new arguments, not used in the hearing.

Standing to bring the case

One of the issues of any parking case is whether the operator has standing to bring a claim for breach of contract. There are two court of record judgments on this issue, both contradictory. Neither is a case between motorist and car park operator and so some of the judgment may also be obiter.

In VCS v HMRC [2013] EWCA Civ 186, the court ruled that the contract between landowner and operator established that VCS were the principal and allowed VCS to take motorists to court in their own name.

In ParkingEye v Somerfield [2012] EWCA Civ 1338, the court ruled that the contract between landowner and operator established that any debt was due to Somerfield, not ParkingEye and that ParkingEye did not have the authority to issue legal proceedings in their own name.

As both of these decisions are binding on the small claims court, the judge's task in any small claim hearing is to determine which of these two cases your case most resembles. You task, therefore, is to try and show the judge how similar your case is to ParkingEye v Somerfield. ParkingEye's task, is of course to attempt to liken the case to VCS v HMRC.

The main distinguishing facts between the two cases are:


VCS are the principal in any relationship between motorist and operator.
VCS fill in, and issue physical permits which the motorist must display in the car and which act as consideration from VCS to motorist
VCS issue charges and collect charges on behalf of themselves

ParkingEye v Somerfield
Somerfield are the principal in the relationship between motorist and operator
No physical permits are filed in or issued by ParkingEye, or need to be displayed.
ParkingEye collect charges for breach of contract on behalf of the landowner

For Riverside Retail Park, Chelmsford, HHJ Moloney ruled the situation resembled VCS v HMRC for the following reasons.

5.7 In construing a commercial contract with apparently contradictory provisions, the Court should where possible seek to give the contract business efficacy and adopt the interpretation which best fits the contract read as a whole- Here, it appears to me that the financial provisions of this contract give the best clue to its real nature so far as the question of "principal or agent?" is concerned. The landowner is not paying Parking Eye to carry out work for it or discharge functions on its behalf. Rather, Parking Eye is paying the landowner for the valuable privilege of being able to run a car park for Parking Eyes own profit, and specifically for being allowed to levy charges on over-stayers. Moreover, as the Claimant points out, the payments to the landlord are at a flat rate; the landlord does not take any percentage or other direct share in the sums received by Parking Eye and is not even entitled to an account of them. This fact renders implausible the Defendants' suggestion that Parking Eye owes some form of fiduciary duty to the landowner. 
In most other car parks, the following evidence can be used to distinguish between your case and VCS v HMRC.

Landowner Contract

Firstly, ParkingEye's standard landowner contract states in clause 3.11
3.11 The Parties acknowledge that the Revenue from the Charges retained by ParkingEye is consideration for the Services and that the supply of the Services attracts VAT at the standard rate. As such ParkingEye will generate a monthly VAT only invoice to the Customer to reflect the additional amount to be paid in VAT in respect of the monies received for the Services. The Customer agrees to pay all such invoices within thirty days of receipt on the Due Date. 
This establishes that ParkingEye are acting as agents of the landowner, collecting the charges (which are for breach of contract) on their behalf. The fact that ParkingEye keep those charges does not alter that relationship. (The actual way the transaction works for accounting purposes is that ParkingEye pay the charge to the landowner, who then pay it back, plus VAT. However, as the non VAT element cancels out, no money changes hands for this part, and a VAT-only invoice is generated where it is marked as 'paid on account'.)

As ParkingEye submit this monthly VAT invoice, it also follows that the landowner has a complete account of parking charges paid. However, the landowner also has access to a more detailed breakdown.

ParkingEye's standard contract also states at clause 8
8.1 On or before the Go Live Date ParkingEye shall notify the Customer of the web
address for accessing the Website in order for the Customer and its employees,
representatives and agents to monitor the data generated at the Site(s) and the
control of vehicles and Permit Holders at the car parking areas located at the Site(s).
Access to the Website shall be in accordance with its terms and conditions. 
Thus, the landowner has access to the full data generated at the site. Here is an example of the type of data customers get.

ParkingEye's standard contract also includes
Parking Eye and the Customer agree that no relationship of landlord and tenant as defined under the Landlord and Tenant Act 1954 is intended or deemed to be created in relation to the operation of this Agreement at any site, nor shall the provisions of this Agreement be deemed to create  in favour of Parking Eye any lease of or similar interest in the land in which the Products are situated.
This establishes that ParkingEye do not have the right to offer parking spaces as principal. if anything, they offer them as agent on behalf of the landowner.

Prankster Note

The question may be asked, why did HHJ Moloney not pick up on clauses 3.11 and 8 which directly contradict his judgment. It may be of course that the contract did not contain these clauses. However, it came out during the hearing that the contract that HHJ Moloney was given was redacted and it may be that these clauses were deliberately withheld by ParkingEye. The Prankster is currently helping with another case for this retail park, and here the defendant has been provided with a contract where these clauses are redacted. The Prankster has previously complained that ParkingEye redact parts of the contract crucial to the case, and he agrees with Hill Dickenson that incorrectly redacting documents is an unlawful and improper practice.


Many signs that ParkingEye use establish that the Landowner has full control of parking. It is important to check the small print and also to get a photographic copy of the signage as close as possible to the date of the parking event, as ParkingEye often fiddle with the exact wording, and keep poor records of their own changes.

Typical small print which will help your case that ParkingEye are agents include the following:

"ParkingEye is solely engaged to provide a traffic space maximisation scheme"
"[ParkingEye] are not responsible for the car park surface, damage or loss to or from motor vehicles or general site safety"
"Parking is at the absolute discretion of the landowner"
"Parking is at the absolute discretion of the site"

ParkingEye's statement of case

In many claims, ParkingEye state that they are agents of the landowner. Sometimes they even provide a separate 'Document on Agency' to back this up.You should therefore make a note of al the places where they occur. It would be unreasonable for them to turn up at a court hearing and completely reverse their position, stating that they were mistaken and that they are actually the principal.

You would be entitled to ask the judge to adjourn the case so that you can have time to prepare a new defence, given that the claimant has a dedicated legal team who should have known the basis on what they were filing, before they considered making a claim.

You should ask for full expenses for a wasted hearing and for ParkingEye to file form N244 and pay a fee to the court if they want to change their statement of case.

In this sample document from another case it is clear that Jonathan Kirk QC (the same person who acted on ParkingEye's behalf for the Cambridge case), thought that in at least this case ParkingEye were acting as agents on behalf of the landowner.

Sample Skeleton Defence for this point

1. Lack of Standing by Claimant: The Claimant is not the landowner of the car park, and has no proprietary interest in it. This means that the Claimant, as a matter of law, has no locus standi to litigate in their own name. Any consideration is provided by the landholder, and only they can sue for damages or trespass.

2. With regard to this, there are two Court of Appeal judgments of note, which are therefore binding on lower courts; ParkingEye v Somerfield [2012 EWCA Civ 1338] and HMRC v VCS [2013 EWCA Civ 186]. In the first, the court ruled that the parking company could not take legal action in their own name. In the second the court ruled they could. The nature of the relationship between landowner and car park operator, and the wording of the contract between them, is key to distinguishing these two cases. It is instructive therefore to compare the current relationship between ParkingEye and landowner, and the wording of the contract, to see whether this more closely resembles ParkingEye v Somerfield or HMRC v VCS.

3. The defendant submits that it is obvious the relationship is more like the ParkingEye v Somerfield case, and relies on the following evidence

a) Exhibit 1, a sample landowner contract, which is believed to be similar to the landowner contract in this current case. Attention is draw to clause 3.11 which shows that all damages for breach of contract are passed to the landowner (and then reclaimed as a service charge incurring VAT). This establishes that ParkingEye act as agent of the landowner and that the landowner has full knowledge of all parking charges. Clause 8 further shows that the landowner has full knowledge of all charges issued and collected. Clause 23 shows that the landowner retains control of the parking spaces
b) Exhibit 2, a sample VAT only invoice 
c) Exhibit 3, sample charge and information provided to the landowner via the web interface
d) Exhibit 4, signage small print. Attention is drawn to the clauses that state; parking is at the sole discretion of the landowner, establishing that the gift of a parking space is the landowners, not ParkingEye's, that ParkingEye accept no liability for the site, establishing for instance that the landowner is the party to claim against if negligence in maintaining the site causes an accident, or negligence in policing disabled bays causes a breach of the equality Act 2010; that ParkingEye solely provide a traffic throughput scheme, establishing that the gift of a parking space is the landowner's.
e) Exhibit 5, ParkingEye's own statement of case, where they claim they are agents of the landowner 
f) The claimant is ParkingEye, the same as in the ParkingEye v Somerfield case. They have made no submissions showing how the current contract differs from that case, or is similar to the contract in VCS v HMRC.

4. Key differences to VCS v HMRC and similarities to ParkingEye v Somerfield are:
a) ParkingEye are acting as agents, collecting charges on behalf of the landowner instead of principal, acting as independent contractor collecting charges for themselves
b) The landowner has full knowledge of charges issued and paid
c) The landowner retains landlord rights and the sole discretion of allowing parking
d) No physical permits, filled in by the operator are issued to the motorists and required to be displayed in the vehicle

5. In 3JD04329 ParkingEye v Wardley (12/05/2014 St Albans) District Judge Cross found ParkingEye’s contract to be more like the Somerfield case than VCS v HMRC, and dismissed the claim. No transcript is currently available. However, the claimant is a well funded company which  regularly purchases transcripts for cases it wins, whereas motorists are not likely to purchase transcripts for cases they win against ParkingEye. ParkingEye were present at this case and can therefore confirm these details from the case notes taken by their representative.

5. If ParkingEye cite ParkingEye v Beavis and Wardley, then it should be noted that HHJ Moloney urges caution that the judgment may not apply to all situations and that the particular circumstances, contracts and signage should be examined. The following points can easily differentiate that case from this.
  1. ParkingEye have not shown that they pay the landowner a flat fee of £1,000 a week in this case
  2. ParkingEye in that case did not collect the charges on behalf of the landowner, and send a monthly VAT only invoice; or if they did, this was not disclosed to the court as clause 3.11 of the landowner contract was redacted
  3. ParkingEye in that case did not provide a web interface to the landowner to monitor parking charges issued and collected; or if they did this was not disclosed to the court as clause 8 of the landowner contract was redacted
The Appeal

Finally, HHJ Moloney gave permission to appeal to the defendants. It is not known at this time whether they will go ahead. However, if they do then if ParkingEye wish to rely on this judgment and include it as part of your case, you should also consider writing to the court to ask for your case to be stayed until the appeal is over.

If your case has other aspects which mean you think you will stand a good chance anyway, you could also ask for a preliminary hearing to decide on just those issues, and if the case is not resolved to await the appeal to decide on issues of standing and whether the charge is a penalty.

Possible issues could be; signage was ambiguous or deficient; you broke down; you visited twice; you were not parked for the time recorded

If you lose your case, and the appeal hearing is imminent, it might be worth asking for leave to appeal based on the result of the appeal hearing.

Happy Parking

The Parking Prankster

1 comment:

  1. We beat ParkingEye!! A well worded letter following a fine threat from PE resulted in a letter from PE informing us they were not pursuing our case. The letter is pasted below. Use as much of it or as little as you like. I think quoting the judgement may have helped. Huge thanks to The Parking Prankster who's site gave us hope when we felt we were going to be stung for £60 or even £100 if we pursued a complaint.

    Dear Sir/ Madam
    We were very disappointed to receive a fine in the post from Parking Eye Ltd on our return from holiday. Your photographs suggest we were only 14 minutes late when we had paid for 8 hours, a nominal amount of time in consideration of the amount of time paid for, although there are also issues with your method of calculation.
    It is reasonable for customers to assume that when purchasing a ticket with a time printed on it, that this is the actual time from which the payment begins. By instead charging from when the car arrives, especially when the ticketed time can be several minutes later than the entrance time, Parking Eye’s policy is both confusing and misleading.
    When we arrived at your car park we were faced with a delay before parking as the car park was busy. We purchased a ticket at 11.08am and reasonably assumed this to be the time at which the 8 hours paid for began. We then enjoyed a fabulous walk up and most of the way down Snowdon. As we passed the half-way point my daughter began to complain of a sore ankle which slowed us considerably and it became apparent that we were going to be tight for time. Ultimately I decided to leave my wife and children at the beginning of the road and run the final kilometre or so, returning with the car to collect them.
    To have been photographed leaving your car park at 7.16pm I must have arrived back in your car park at approximately 7.14pm. This was therefore only 6 minutes later than the time we believed the ticket we had purchased covered.
    I can accept that I returned to the car park late, although less than 10 minutes so, and I feel that a fine for such a small amount of time when 8 hours has been paid for is unreasonable, unwarranted and excessive. It was clear from our actions – paying for 8 hours parking to cover a 6 hour walk – that there was no intention of avoiding parking charges
    A charge of £100 or even £60 seems exceptionally high and not a ‘genuine pre-estimate of loss’, as cited in numerous cases of this kind when appeals against these charges have gone to court.
    The excessive nature of this fine is also evidenced by court cases. If I can draw your attention to the case of Mr Fergus Cargius, and Parking Eye’s case to claim £100 and, in particular, the Judge’s ruling.
    In her ruling District Judge C Mahy said, “The fact is that Parking Eye could have been quite satisfied if Mr Cargius had paid a further £2 and the subsequent charge of £100 is in my judgement totally disproportionate to the level of Parking Eye’s loss. “
    “It is in my judgement a penalty and therefore unenforceable in this case.”
    Mr Fergus was 1 hour 23 minutes late due to an injury, while we were arguably only 6 minutes or at worst only 14 minutes late. I enclose cheque for £10 and trust you agree that this constitutes a generous settlement in light of the case above.
    It would be expensive and unnecessary for this situation to proceed to POPLA, or even the Small Claims Court, so I trust you will accept our settlement offer.
    Yours faithfully