BW Legal successfully appeals strike out orders on claims incorporating contractual debt recovery costs for the Private Parking Industry

Britannia Parking Group Ltd v Matthew Semark-Jullien

On 16 July 2020, His Honour Judge Parkes QC, sitting at Salisbury on appeal from Southampton, allowed the Claimant’s appeal of the order of District Judge Grand made on 11 November 2019 (drawn by the court on 18th).

It should be noted that this appeal was not a challenge against the customer Mr Semark-Jullien, but against the court’s findings upon reviewing the Claim in boxwork, and subsequently in an unfortunately short set aside hearing before District Judge Grand on 11 November 2019 in Southampton. Ultimately, the appeal judge found that the striking out of the claim on the basis that it had been found to be an abuse of process, that the Claimant knew the claim was “inflated and unlawful”, and the judge’s reliance on ParkingEye v Beavis and the Consumer Rights Act 2015 to support his decision, was wrong.

The Claim is a simple one, which will be common to many operators, for an unpaid parking charge notice of £100, plus £60 for “recovery charges” in respect of the Claimant’s costs of recovery. The whole Claim was struck out in box work by District Judge Taylor on 23 May 2019, prior to allowing the Claimant to file its evidence, on the basis that the recovery charge was deemed not recoverable under the Protection of Freedoms Act 2012 (schedule 4), nor under ParkingEye v Beavis. Before DJ Grand, considering the Claimant’s application to set aside DJ Taylor’s order, the strike out was upheld for slightly varied reasons, which did not include POFA, but did add the Consumer Rights Act 2015.

The Claimant appealed upon advice from BW Legal and counsel, with the principle grounds being:

  1. There was no evidence before DJ Grand that could entitle him to reach conclusions as to the claimant’s motives or intentions;
  2. Beavis does not address the lawfulness of recovery charges;
  3. The judge did not properly consider the Consumer Rights Act 2015, again due to the lack of evidence, so any determinations as to fairness of terms was wrong;
  4. The judge was wrong to approve the decision of DJ Taylor in deciding to strike out the Claim under CPR 3.3(4), since DJ Taylor did not have all the material before him to correctly make his decision.

HHJ Parkes QC has very carefully set out his understanding of the issues, the claimant’s submitted arguments, and his decision, in a short but succinct written judgment. The key statements of the appeal judge, which are set out in a way that should be helpful to all stakeholders, affirm the positions taken by BW Legal in respect of parking claims, are:

  • On the striking out of the claim:
    • …it will only be in the clearest cases that it will be right to strike out a claim as an abuse of process. There is no doubt that deliberately to make a false claim is an abuse of process, but the Alpha Rocks judgment shows that the abuse must be clearly established… Firstly, it is wrong in principle to strike out a claim as an abuse of process on the footing that the claimant knows it to be inflated and unlawful, when there is no evidence that the claimant knows anything of the kind… Litigants should not be deprived of their claims unless the abuse relied on has been clearly established
  • On the applicability of ParkingEye v Beavis:
    • The debt recovery charges does not fall foul of the decision of the Supreme Court in Beavis. The court was not considering debt recovery charges in that case
  • On the applicability of the Consumer Rights Act 2015:
    • Where or not the term is in fact unfair depends on the factors stated at s.62(4) and (5), but the judge did not refer to that section or take those matters into account…
    • Even if it had been right to regard the debt recovery charge as unlawful, the effect of s67 of the 2015 Act is in principle that the contract otherwise continues to have effect. In other words, the claim for the £100 PCN did not necessarily fail as a result. However, the judge appeared not to have considered s67.

The judge’s comments clearly absolve the Claimant and BW Legal of the very harsh findings that there had been an abuse of process and a knowingly inflated claim, phrases that have since been repeated by judges up and down the country without any reasonable justification; indeed, in allowing the appeal, the appeal judge himself said that DJ Taylor had “made what amounted to a finding of fraud, or at least dishonesty, without the benefit of any evidence. District Judge Grand made in effect the same conclusion”. BW Legal are particularly pleased at this vindication, which we have not hitherto complained about, respecting the authority of the courts and patiently trusting the judicial process on appeal. But going forward, we very much hope that courts and all interested parties will take note of this particular confirmation, and that our client’s claims will be fairly considered on balance of evidence.

We consider the findings on Beavis that recovery charges were simply not considered, to be unsurprising, but again, this is helpful clarification on the current misguided commentary across the industry.

Lastly, should courts wish to find that a particular term falls foul of the Consumer Rights Act 2015, it must be properly reviewed against the evidence, and even if it is found to be unfair, the PCN claim remains. Whilst this decision could not decide if the Claimant’s claim in this case fell foul of this Act, due to the lack of evidence to enable the court to do so (and hence why the appeal judge agreed that DJ Grand was wrong to find any unfairness), we are confident of our arguments on the applicability of this Act to our client’s claims.

BW Legal’s analysis of the Decision & its implications moving forward

The decision sends a very strong and clear message to individuals that rely on “advice” posted on various consumer forums such as Money Savings Expert, Legal Beagles, Pepipoo etc. These forums contain numerous posts and analysis of
DJ Grand’s original decision and ways in which consumers should argue against the recoverability of debt recovery charges, including citing various County Court level decisions. Inevitably, these forums now host a swathe of internet-based template defences, which in our view, does very little to assist the court in understanding the customer’s case, as the majority of the defence has no actual bearing to the facts.

For example, some defences put private parking companies to strict proof that the ANPR cameras were calibrated correctly, however, the facts actually involved a warden patrolled car park. What is quite clear from reading various threads posted on these forums is that what is on offer are not ways to engage in dialogue with private parking companies (or their solicitors), but rather guidance on how to avoid paying legitimate debts.

The risk for individuals is that they treat these templates and forum posts as advice, which in most cases, are just misleading. Having proper legal representation and advice is a fundamental right for consumers – granted, such advice may be expensive, however, there are organisations which do offer free legal advice, for example, the Citizens Advice Bureau, and some firms will even operate on a no-win-no-fee basis. The most important part of obtaining proper legal representation and advice is the fact that law firms are regulated by either the SRA or CILEx Regulation. Therefore, if the firm acts negligently which leads to an adverse outcome for their client (i.e. the consumer), the consumer has a remedy against the firm, as regulated entities have professional indemnity insurance in place to cover such an eventuality

The Pitfalls of Forum advice and using Lay Representatives

This poses a very interesting debate regarding the use of Lay Representatives by consumers at court hearings In the small claims court, a Lay Representative, i.e.a person who is not the litigant or a qualified solicitor or barrister, may represent the litigant as long as the litigant is present (the Lay Representatives (Right of Audience) Order 1999 enables this). Typically a lay representative is a person who is able to better advocate the litigant’s case than they would themselves. A Lay Representative is different to a McKenzie Friend, who is another person who attends court and provides advice and moral support to the litigant, but is not allowed to address the court directly.

Over the past few years, we have seen a significant number of consumers being accompanied by Lay Representatives at hearings. Familiar names such as Lamilad, CouponMad, Bargepole who are regular “forumites”, also represent consumers at court hearings as a Lay Representative. If you read their posts, you might think they are qualified solicitors or barristers, but the reality is that it is unlikely that they have any recognisable legal qualification, including the right to practice law or conduct litigation on behalf of consumers. Some of these Lay Representatives are also charging fees to consumers for representing them in court, or assisting with drafting documents such as defences or skeleton arguments etc. This begs the very important question – if the Lay Representative has acted negligently, whether by providing incorrect advice, making factually incorrect/irrelevant submissions at court, or simply misrepresenting the consumer’s position, what recourse does the consumer have against the Lay Representative? They cannot complain to the Law Society, the SRA or the Bar Council because Lay Representatives aren’t regulated. They certainly do not have professional indemnity insurance to be able to indemnify the consumer. The only option would be for the consumer to initiate legal proceedings against the Lay Representative or apply to the court to seek a costs order (which would be rare).

These “forumites” seemingly boast about their wins at court, but yet, you see very little about the cases they have lost. There are numerous posts about the whole “abuse of process” argument in relation to private parking companies and their solicitors adding debt recovery costs to the claim, however, in light of the appeal decision by  HHJ Parkes QC, the “advice” that the likes of CouponMad etc have been giving consumers has been
ill-founded, and ultimately found wanting. Despite this, certain individuals have been placed on panels for their input (representing a consumer view). Whilst they may think that they are “fighting the good fight” for consumers, ultimately, where is the accountability? The consumer could be faced with a scenario where not only do they have to pay the parking charge, court fees, solicitors costs, interest etc, but also the Lay Representative’s costs. Will the Lay Representatives be refunding the fees to the customers in light of this decision?

Why Customers should now contact BW Legal to reach a resolution

The reality is that all pre-allocation claims which have previously been struck out by Deputy and District Judges for being “an abuse of process” could now be subject to set aside applications, and the consumers that relied on the advice given by CouponMad, Lamilad etc may be left to pick up the pieces. We would ask customers that have been affected by the above and who have accounts with us to get in touch to resolve matters by arranging suitable repayment plans, and we are happy as always to work with customers to reach a resolution.

As a firm of solicitors, litigation is a last resort measure and this is what we advocate to our clients. Hence, why we make so many attempts to engage with a customer before considering legal action. We do not ignore mitigating circumstances or genuine disputes, and we would much rather speak to the customer about such circumstances to see whether an amicable solution can be reached. By proactively engaging in correspondence or dialogue with a customer, invariably, commercial and common sense will prevail. We cannot see how internet based templates assists a customer in putting forward any genuine reasons for not paying a PCN, or any debt for that matter, which we would otherwise take into consideration.

The irony of it all is that since BW Legal entered the private parking sector, we have suffered constant abuse from some customers, campaigns to leave poor reviews about our firm on Google, Trust Pilot, unsubstantiated complaints, media enquiries, complaints made to the SRA, FCA (despite not falling within the FCA’s remit), memberships like the CSA, all incited by various consumer forum groups, simply to obfuscate a legitimate process.

We have never spoken out about all the abuse we have received and we have always engaged with our regulators to assist them in understanding the sector, however, we felt it was important to share our insight and experience with a view of setting the standards for best practice in the industry. Ultimately, as a firm regulated by both the SRA and FCA, we act on client instructions, providing a service where customers are given every opportunity to engage and set up affordable repayment plans, provided breathing space where applicable so they can seek assistance from debt charities and mental health organisations. Whilst we always welcome feedback as to where we might improve on these efforts, it would be of far greater assistance if this feedback was more engaging and constructive, rather than the current focus of being obstructive.

The Importance of the Private Parking Sector

Conversely, let’s look at a situation where there are no regulations in place on private land managed by private parking operators and no parking charges. What happens when a motorist parks their vehicle in an ambulance bay because they could not be bothered to find a space? What happens when somebody leaves their vehicle on an airport access road which is meant to have free flowing traffic? If you are a resident, and somebody who is not authorised parks in your allocated bay? What if somebody parks in a disabled bay when they are not meant to so a disabled person is deprived of the space? If there are no deterrent measures such as parking charges (as clearly recognised by the Supreme Court when Mr Beavis took his case there), considering clamping of vehicles are banned, there would be no mechanism in place to prevent motorists from abusing parking regulations.

The operators that provide parking management schemes to landowners are businesses, and to sustain a business, there needs to be income to cover the operating cost, infrastructure such as installation of ANPR cameras, DVLA costs, signage, patrolling etc. This is a legitimate reason (as recognised in Beavis), as well as the wider socio economic justification, for issuing parking charge notices to deter motorists from abusing private land. If you analogise the private parking model with the local authority model for enforcing penalty charge notices, you would find that the consumer could end up being liable for up to three times more than the private parking model, considering local authorities utilise bailiffs for enforcing unpaid charges. For instance, if payment is not made for a Penalty Charge Notice within 21 days of receipt of an Order for Recovery, a Warrant of Control will be issued and passed to an enforcement agent who will levy a fee of £75 upon being instructed. This is added to the debt, followed by a further fee of £235 if a bailiff’s visit is required, all of which happens in a very short period of time.

How BW Legal deals with debt recovery charges

At BW Legal, we act for operators that are members of both the DVLA Accredited Trade Associations BPA and the IPC. Contrary to the comments in some limited judicial decisions, the Supreme Court recognised the role of the BPA in its judgment of 2015, considering in detail its guidance in relation to the parking charge being sought by the parking operator.

Both membership bodies have specific provisions in their respective code of practice regarding the amount of debt recovery costs an operator can add to the unpaid parking charge – for the BPA, the amount is £70 per PCN and for the IPC, it is £60. It should be clear that an operator only seeks debt recovery charges if and when time is spent recovering the unpaid parking charge beyond the notice period set out in the parking charge notice, usually when they have to instruct an agent and/or solicitors to assist in the collection. Such recovery charges, where recovery becomes necessary, have long been recoverable by a debtor, subject of course to reasonableness.

Whilst our BPA clients are entitled to administer a charge of £70 on unpaid PCNs, when BW Legal act for a BPA client, we only seek to recover £60 in relation to debt recovery costs. Even for persistent offenders, we do not administer £60 per PCN – in fact, we reduce the debt recovery costs to make it fair and proportionate to the debt. Contrary to what customers believe, we are not in the industry to make a quick buck – rather it is to provide a transparent mechanism, where our client’s customers are treated fairly, as ultimately our clients want customers to be using their car parks, but in a compliant manner. We have, in some circumstances, seen that some firms are increasing the PCN value citing administrative charges. We would not condone this as no person or entity should be charging over and above what is stipulated in the relevant code of practice, but more importantly, if it is a genuine administrative cost, it is a cost chargeable to the parking operator and it should not be passed down to customers.

Paving the Way Forward

At BW Legal, we look to find solutions to problems affecting the industry like the recoverability of debt recovery costs, effective enforcement of PCNs in residential areas, whilst at the same time, being a “best in class provider” by investing in and providing technological platforms to help our clients reduce their administrative time and costs. We now have a fully integrated system with ZatPark so clients do not have to manually update case statuses, payments, settlements, send evidence to us etc. This is all done automatically via an API where we send updates and retrieve data in a secure digital platform. For us, finding innovative ways to provide an enhanced and evolved end-to-end service for our clients is paramount and goes hand in hand with maintaining a good customer centric approach to their customers – whether they appreciate us contacting them or not.

Whilst the BSI appears to be making significant progress regarding the single Parking Code of Practice, what the steering group and the government need to take into account is the seemingly unappreciated yet vital role private parking operators and companies like BW Legal play in providing an ethical, customer-focused parking compliance scheme to the public and landowners alike. Parking charges have and will always be an emotive topic, however, does it justify the abuse we face in providing a legitimate service? As a firm of solicitors, we are ultimately accountable to our regulators, but who are the like of CouponMad – somebody who has no legal training or a university degree but has been quoted as saying “I have an eye for detail and a good memory for facts and policy, codes of practice and laws” accountable to? Solicitors spend years reading the law, training, sitting exams and working in practice so that they can advise clients, so unfortunately a good memory just doesn’t cut it in our view.

Similar to how we set the precedent in the VCS v Ward case on “no stopping” contraventions, this result is yet another instance where we have taken a principled approach, at our own expense, to right a wrong decision for the benefit of all stakeholders. As a result, parking operators, accredited service providers and customers now have clarity on the relevance of the Consumer Rights Act 2015, PoFA 2012 and the scope of ParkingEye v Beavis when seeking debt recovery charges.

CONTACT US

To discuss the impact of this decision on your private parking business, please contact us using the details below:

Rohan Krishnarao

Head of Legal Client Strategy

T: 0113 468 3000

E: rkrishnarao@bwlegal.co.uk

 

Corrin Brown

Senior Solicitor

T: 0113 468 3000

E: cbrown@bwlegal.co.uk

Visit our website at www.bwlegal.co.uk

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