Thursday, 4 June 2015

Henry Greenslade throws lifeline to legitimate parking companies

Henry Greenslade, lead adjudicator of POPLA has today made a brave decision which will send shudders through the rogue elements of the parking companies. His full statement is available here, but the essence is that now Barry Beavis has filed an appeal, all POPLA cases where the operator relies on the ParkingEye v Beavis result will be stayed until the case is heard at the Supreme Court. This may be some time after July 2016.

The main areas parking cases are contested are

  1. did the event occur
  2. was the signage sufficient
  3. does the operator have authority
  4. were consumer regulations complied with
  5. are the conditions which make the keeper liable fulfilled
  6. is the charge appropriate
If the parking company complies with the first 5 conditions, then POPLA's decision will depend on the result of the sixth. Of course, if they do not comply then POPLA will uphold the appeal.

If the operator is legitimate and the charge is a genuine pre-estimate of loss, then POPLA will rule for the operator; existing case law covers this. Legitimate operators therefore have nothing to fear from Mr Greenslade's decision.

The rogue operators who have artificially inflated their charges will have to rely on the ParkingEye v Beavis result to justify themselves, and this will result in the case being stayed until the Supreme Court hearing. It will be very interesting to be a fly on the wall to see which operators are making angry phone calls to POPLA and Steve Clark of the BPA over the next few days.

The Prankster considers that a parking charge of around £25 in line with council charges is likely to be in the region of a genuine pre-estimate of loss and therefore this level of charge is likely to be allowed by POPLA. Ironically, the ParkingEye v Beavis result also ruled that charges in line with council charges are likely to be allowable. 

With further irony, this level of charge is likely to be perfectly acceptable to the parking operators who offer genuine management services to the landowner. These operators will charge a management fee and therefore be interested in providing a genuine service, in minimising transgressions and will only issues charges when hey are justified.

The rogue element who offer their services for free have to rely on sharp practices and targeting the motorist to maintain their income stream. These companies will have to reassess their way of operating if they want to win at POPLA.

Will it matter

Currently only around 1% of cases go to POPLA. In theory the operators can therefore afford to ignore this and go for business as usual.

However, what may matter more is if the courts take the same view. Judge Jones in Reading is postponing all cases involving ParkingEye until the outcome of the Supreme Court is known. Other courts and judges may well follow suit.

ParkingEye file around 30,000 claims a year, and to each of these claims they add a filing fee of £50. Of course, their claims are electronically generated using templates, so it actually costs almost nothing for them to file the claim, and the £50 is almost all profit. Only around 3,000 claims actually get to court, so if we assume that in most of the rest the motorist caves in and pays up, then this £50 generates around £1.3 million. ParkingEye's last accounts (2013) showed a pre-tax profit of £1.6 million.

This means that ParkingEye are relying on filing court claims to generate most of their profit; if the courts stayed all cases then ParkingEye could be in serious financial difficulty.

Of course, the 2014 accounts may show a different picture so The Prankster eagerly awaits their arrival to see if ParkingEye have cooked their own goose or if they have other income streams.

Legitimate Operators

Currently legitimate operators have difficulty winning contracts away from the rogue operators who come in and offer landowners parking 'management' for free. Of course, once the landowner realises that they have let the wolf into the hen-house it is too late and the landowner finds there are large penalty clauses if they want to cancel. 

This new ruling may tip the balance and make it more of a level playing field if all operators need to charge a management fee to make the contract viable. This will be a welcome change.

The Prankster and Mr Greenslade have clashed before and no doubt will again, but for the second time The Prankster tips his hat to Mr Greenslade.

Happy Parking

The Parking Prankster


  1. Parking Eye in serious financial difficulty! GOOD.

  2. they will just go back to the government for another £1000,000 loan

  3. That is a pretty tasty piece of news!

  4. I thought in the Beavis case PE paid £20000 for the concession to issue penalty charges. The penalty charge of £85 was seen by the CofA as commercially justifiable amount to recover these amounts paid out to landowners and other associated business costs. The council charge of £25 would not cover the cost of these inducements.

    1. It was £1,000 a week, but regardless this is exactly the point. As this business model would no longer be viable, at least until the Supreme Court decision, then only operators charging management fees and a small parking charge would have a chance of winning at POPLA.

    2. Agreed. So essentially what the Supreme Court has to adjudicate on is whether a contract between a landowner and a PPC which has the effect of artificially increasing a 'GPEOL' can be said to be legal if this has the effect of loss to a third party.

  5. It was £50,000. Why not make it £100,000 and they can charge £170 - or £200,000 and they can charge £340.

    Underlines the issue of a business model relying on falsely creating "debts"

  6. A case of the biter bit - surely? PE wanted cases stayed at POPLA because it suited them. Sauce for the goose of course. Interesting to see the IPC reaction!

    1. The IPC won't react because their "independent appeals system" is only a scam anyways, so nothing will change there.