Scottish Court of Session Decisions

The respondents are charged with the licensing and regulation of taxis and private hire cars in the city of Edinburgh. Until the introduction of the procedures referred to below, the respondents issued taxi licences (i.e. licences relative to vehicles plying as taxis) only to individuals. They also maintained and maintain a waiting list for individuals interested in obtaining a taxi licence. That list was brought into existence by the respondents' statutory predecessors but has since been closed. The petitioner, however, who has held a taxi driver's licence since February 1993, later that year on payment of a fee of £20 was entered on the taxi licence waiting list.

In 1997 proposals were made by the respondents' officials for amending the procedures relative to the issue of taxi licences. Those concerned arrangements for the issue of such licences to non-natural bodies, viz to partnerships and limited companies ("corporate licences"). A report by the Council Solicitor was submitted to a meeting of the Licensing Committee on 17 October 1997. It recommended that the respondents, with effect from each existing licence's annual renewal date falling after 1 January 1998, accept and progress applications for taxi licences from partnerships and companies. The existing general limit on the total number of taxi licences was to be maintained as was the waiting list but the respondents' policy would be amended with regard to applications from non-natural persons complying with the following criteria:-

Certain changes were also proposed in respect of the waiting list, a points system being substituted for advancement on the list strictly in chronological order. On 17 October 1997 the Licensing Committee adopted the procedures for taxi licence applications quoted above, a remit to the Council Solicitor being made to report on certain other aspects which are not for present purposes material. On 24 July 1998 the Committee affirmed and readopted the amended procedures.

In late 1997 or early 1998 the respondents issued a document entitled "GUIDANCE NOTE ON TAXI LICENCES - NEW PROPOSALS". The material terms of that document, as then issued, were as follows -

Certain administrative arrangements were then set out. The document continued -

There followed reference to policies in respect of (1) spouses, sons and daughters of taxi licence holders who had died or who intended to surrender their licences and (2) holders of taxi licences for taxis which plied for hire from Edinburgh Airport. The document concluded -

Early in 1998 the petitioner had discussions with a Mr Roy concerning the possibility of their entering into partnership together. Mr Roy also held a taxi driver's licence. He did not hold a taxi licence nor was he on the waiting list for such a licence. It was proposed that an approach be made to the holder of an existing taxi licence who was minded to retire, with a view to his joining the partnership. An application would then be made for that licence at its annual renewal date to be transferred to the partnership. Thereafter the former licence holder would resign from the partnership which would be continued by the petitioner and Mr Roy. According to the petitioner's averments that arrangement was envisaged as continuing only until the petitioner reached the top of the waiting list and was granted a taxi licence as an individual. On that occurring, it is averred, Mr Roy would buy out the petitioner's share of the partnership business and the petitioner would retire from the partnership and commence trading, as a taxi licence holder, on his own account. The petitioner avers that he anticipated that he would reach the top of the waiting list and be granted a taxi licence in about the summer of 1999.

Such an arrangement, it was envisaged, would have significant financial and social advantages for the petitioner. The petitioner consulted his solicitor with whom he discussed the proposals and from whom he received certain advice. An approach was made to a Mr Coulman, the holder of a taxi licence. In May 1998 the petitioner, Mr Roy and Mr Coulman entered into a contract of partnership to commence on 15 June 1998 under the firm name "A2B Travel". A term of the contract was that the partners would apply for a licence in the name of the partnership in respect of the taxi to which Mr Coulman's licence related. On 15 June 1998 the petitioner and Mr Roy, it is averred, paid to Mr Coulman the first instalment of a capital payment in respect of the arrangements between them and gave notice of resignation to their existing employers. They also, it is said, carried out work on the taxi acquired by the partnership from Mr Coulman and made arrangements for a taxi radio facility.

An application was then made to the respondents for a new taxi licence in the name of the partnership in respect of Mr Coulman's existing licence, the annual renewal date of which was shortly due. In a letter dated 29 July 1998, addressed by an official of the respondents to the petitioner and under reference to the application, the writer noted that the respondents' records confirmed that, although the petitioner was named in the application, he was also at present on the waiting list. The letter continued -

The petitioner protested to the Council's officials about this requirement (of which he maintained he had been unaware) but was told that, if he did not resign from the waiting list, the application in the name of the partnership would not proceed. On 3 August the petitioner wrote to the respondents confirming that his name might be removed from the waiting list. By letter of 7 August the respondents advised that the partnership's application had on that day been granted, subject to the surrender of the licence held by Mr Coulman.

One further matter of history requires to be narrated. A Mr McTighe at about the same time made similar arrangements to those made by the petitioner. When asked for confirmation that his name might be deleted from the waiting list as a condition of the issue of a partnership licence, he also protested. His protest was ultimately brought before the Licensing Committee. The Convenor of the Committee adhered to the insistence that Mr McTighe consent to his withdrawal from the waiting list, which he then did under protest. The Convenor, it is averred, made in the course of those proceedings a remark to the effect that the respondents would have to change the Guidance Note. A revised version of the Note was subsequently issued. It was in the same terms as the earlier version except for the insertion after the first sentence of the second paragraph the following -

Mr McTighe subsequently brought successful proceedings for judicial review; but it appears that the decision in that case proceeded on different grounds from those advanced in the present petition.

The petitioner seeks to bring under review the notification given by the respondents to him by the quoted words of their letter of 29 July 1998. Although that notification was not in the form of a decision by them, it was accepted in the discussion before me that it was a communication by the respondents in implement of their policy and as such was amenable to judicial review. The issue discussed was whether the petitioner's averments were relevant to instruct the grounds of challenge advanced by him. These grounds, as amended, are -

The remedy sought by the petitioner is an order -

Although Mr Abercrombie for the petitioner opened the discussion at the first hearing of the petition, it is convenient first to record the submissions made by Mr Bovey for the respondents. These attacked the relevancy of the petitioner's averments. Mr Bovey submitted that the critical ground of challenge advanced by the petitioner was ground (b); if that fell, grounds (a) and (c) fell with it. There was no substantial difference between English law and Scots law as to the grounds on which the process of decision-making might be open to review (West v Secretary of State for Scotland 1992 S.C.385 at page 413). Reference to English authority on "legitimate expectation" was thus helpful. Of the four senses in which that phrase was used, as identified by Simon Brown, L.J. in R v Devon County Council, ex parte Baker [1995] 1 All E.R.73 at pages 88-9, the petitioner's contentions appeared to fall into category (1) - that relative to substantive right. What was required to satisfy legitimate expectation in that sense was usefully explained in R v Jockey Club, ex parte RAM Racecourses [1993] 2 All E.R.225, per Stuart-Smith, L.J. at pages 236-7. The equivalent in Scotland of estoppel in England was personal bar, the classic statement of which was to be found in Gatty v Maclaine 1921 S.C.(H.L.)1, per Lord Birkenhead, L.C. at page 7. The reference by Bingham, L.J. (R v Board of England Revenue, ex parte MFK Underwriting Agents Limited [1990] 1 W.L.R.1545, pages 1569-70) to breach of contract in private law was also helpful. A mere statement of intention did not meet the personal bar test (Mason v Benhar Coal Co (1882) 9 R 883; Gloag & Henderson - Introduction to the Law of Scotland (10th Edition) para.5-8). The respondents were entitled to adopt a policy in relation to the issue of taxi licences and to change that policy from time to time. Legitimate expectation could not prevent or interfere with a change of policy fairly carried out (R v Torbay Borough Council, ex parte Cleasly [1991] C.O.D.142). The petitioner's averments were irrelevant to instruct elements (1), (2) and (4) referred to by Stuart-Smith, L.J. in R v Jockey Club, ex parte RAM Racecourses at pages 236h-237a. No clear and unambiguous representation was relevantly averred. There was nothing in the Guidance Note as originally issued which created any legitimate expectation that a partner or director of a corporate applicant would be entitled to remain on the waiting list. Nothing at all was said about such persons; there was no clear and unequivocal representation directed to them. It was a Guidance Note to persons who held taxi licences as individuals and who might be interested in trading them in for something else. It had not been sent directly to the petitioner. No doubt he or his solicitor might acquire a copy; it appeared that his solicitor had obtained one through the respondents' public office. It might have implications for those on the waiting list but, even if it could be construed as including a representation to such persons, it was not reasonable for the petitioner or his solicitor to rely on that representation without more, i.e. without making enquiry directly from the respondents (R v Jockey Club, ex parte RAM Racecourses, per Stuart-Smith, L.J. at pages 238-9). Moreover, it was far from clear that there had been any detriment to the petitioner. Had the petitioner been aware from the outset that he would require to surrender his position on the waiting list as a condition of a licence being granted to a firm of which he was a partner, his choice would have been likely to have been the same. The advantages of immediately obtaining a corporate licence would have outweighed any advantage in remaining on the waiting list (which migh

Mr Abercrombie submitted that the petitioner's position fell squarely within the situation described by Bingham, L.J.in R v Board of Inland Revenue, ex parte MFK Underwriting Agents Limited pages 1569-70 (as referred to by Stuart-Smith, L.J. in R v Jockey Club, ex parte RAM Racecourses at page 236). It would be grossly unfair if, the respondents having issued the Guidance Note in its original form and the petitioner having relied on it as he had, the respondents were entitled to require him to surrender his place on the waiting list. There was nothing in the Guidance Note to suggest that, as a condition of a firm of which he was a partner obtaining a corporate licence, the petitioner as an individual would require to surrender that place. The requirement had appeared only in the revised version. The factors referred to by Stuart-Smith, L.J. at pages 236-7 were satisfied. A representation could arise negatively as well as positively, i.e. by something left unsaid as well as by something said. Reference was made to Rankine on Personal Bar at pages 7-8. Here there had been a clear and unambiguous representation that the procedures for corporate licences had nothing to do with the waiting list. No one reading the Guidance Note would have dreamt that anyone on that list would be required to give up his place. He would have a legitimate expectation that his place was unaffected. The Guidance Note had been issued to the taxi trade as a whole. The petitioner was a person within the class of persons who were entitled to rely upon it; it was in any event reasonable for him to do so, as he had. There was not here, as in R v Jockey Club, ex parte RAM Racecourses, a lack of clarity or inherent contradiction calling for further enquiry. It was not conceded that it was necessary for the petitioner to demonstrate that his reliance on the representation had been to his detriment. Reference was made to De Smith, Woolf and Jowell on Judicial Review (5th Edition) para.8-060. In any event, it had been so demonstrated. The petitioner's legitimate expectation had been denied by the respondents. Moreover, their insistence on applying the policy to the petitioner was in the circumstances unreasonable in the Wednesbury sense. It was material to have in mind that there were some individuals who held more than one taxi licence; there were also other individuals who held such a licence and were also on the waiting list for another. The arrangements entered into by the petitioner (and to which he had committed substantial resources) were envisaged as securing a benefit in the shorter term; the petitioner's longer term benefit lay in securing a licence in his own name by progression on the waiting list. The petitioner simply sought to be restored to the position which he had previously enjoyed.

It is clear that the policy adopted by the respondents at the Licensing Committee meeting on 17 October 1997 and subsequently affirmed had possible implications not only for existing holders of taxi licences but also for those on the waiting list. Paragraph 3.4.1.3 of the Council Solicitor's report in terms provided that any partner or director of a corporate applicant must agree to give up his position on the waiting list. The procedures detailed in paragraph 3.4 as a whole were adopted by the Licensing Committee on 17 October and thereafter brought into force as aspects of policy. It is to my mind a matter of regret that the Guidance Note as originally issued did not draw attention to that aspect of the policy. That, however, does not suffice to entitle the petitioner to the remedy which he seeks.

Mr Abercrombie did not challenge Mr Bovey's submission that, in relation to the case so far as based on legitimate expectation, the relevant sense of that phrase related to substantive right - category (1) as identified by Simon Brown, L.J. in R v Devon County Council, ex parte Baker at page 88. After referring to various earlier cases (including R v Board of Inland Revenue, ex parte MFK Underwriting Agents Limited and R v Jockey Club, ex parte RAM Racecourses) in which legitimate expectation in that sense had been discussed, Simon Brown, L.J. observed -

I was not referred to any Scottish authority in which the concept of legitimate expectation in that sense has been discussed and applied. But, as presently advised, I see no reason to doubt that a clear and unambiguous representation is a necessary element of legitimate expectation in that sense.

In my view that element is not satisfied in this case. It is indisputable that no express representation was made in the Guidance Note, as originally issued, about the position of persons on the waiting list. I assume, without deciding, that a representation can for present purposes be made by implication. On that assumption, however, there would require to be a clear and unambiguous implication from the terms of the Guidance Note that the position of a person on the waiting list would not be affected by the making of an application for a taxi licence by a partnership or company of which he was a partner or director. No such implication can, in my view, clearly and unambiguously be drawn. The mere absence of any reference to the waiting list does not justify an inference that a corporate application will have no consequences for a person on it. It would, indeed, be surprising if it had none. The evident purpose of the new procedures was to encourage the replacement of existing taxi licences held by individuals by taxi licences held by partnerships or companies. That necessarily involved the existing licence being in some way given up, so that there would not (except possibly transitionally) exist concurrently a new corporate licence and the existing licence held by the individual. If those on the waiting list were to be wholly unaffected by those arrangements, a situation would potentially arise in which there would exist concurrently a corporate licence in which an individual had an interest as partner or director and a licence acquired by that individual on his reaching the top of the list. That would clearly be contrary to the general objective of the policy. Such a situation could no doubt be avoided in one of a number of ways - for example, (1) by requiring the individual to withdraw his name from the waiting list as a precondition of the grant of a corporate licence or (2) by allowing him to remain on that list but on his reaching the top of it refusing to grant him a licence if there was then in existence a corporate licence in which he had an interest or (3) by allowing him to remain on the list but, as a precondition of granting him a licence as an individual on his reaching the top of it, requiring him to sever his connection with the partnership or company. The last might have had enforcement difficulties. However that may be, it was not unlikely that in one way or another the respondents would seek to prevent the general objective being undermined. Thus it was not unlikely that a person on the waiting list would be affected if he chose to be involved in the making of a corporate application. That proposition was, in my view, implicit in the Guidance Note as originally issued; in any event, any contrary proposition (that such a person would not in some way be affected or would not be affected in the particular way which occurred) was not implicit in it. In these circumstances I reject Mr Abercrombie's submission that a clear and unambiguous representation in the terms suggested by him was made by the respondents in the Guidance Note. As some reliance was placed on it, I should add that the fact that an individual may hold more than one taxi licence or hold a licence and also be on the waiting list is, in my view, irrelevant to consideration of the arrangements for corporate licences described in the Guidance Note. In these circumstances the petitioner's ground (b) must fail.

In these circumstances it is unnecessary to consider whether there are relevant averments in support of elements (2) and (4) referred to by Stuart-Smith, L.J. in R v Jockey Club, ex parte RAM Racecourses at pages 236-7. However, I deal briefly with them. Element (2) is properly concerned with whether the applicant for judicial review is a person entitled to rely on the representation (see page 238). The Guidance Note was not sent directly to the petitioner but it was placed by the respondents in their public office from where, it appears, the petitioner's solicitor obtained access to it. It was, in my view, clearly intended to constitute guidance not only for current individual taxi licence holders but also for prospective partners (or prospective fellow directors) of such persons - and of the legal advisers of such persons. The petitioner and his solicitor can accordingly be regarded as within a class of persons whom the respondents, actually or presumptively, intended any representations contained in the document to reach and affect. In holding that the applicant (RAM Racecourses) was not within head (iii) of the test referred to in the cited textbook, Stuart-Smith, L.J. noted (at page 238j) that the document in that case had not been made public. His later observation at page 239e-f was concerned with representations "to the world". In these circumstances, had I held that there was a relevantly averred clear and unambiguous representation, I would have held that the petitioner's averments were sufficiently relevant to meet element (2). So far as concerns element (4), it would not be possible without inquiry to determine whether any reliance by the petitioner was to his detriment. Given the apparent uncertainty whether detriment is or is not a necessary element for this form of legitimate expectation, it would be inappropriate without ascertainment of the material facts to hazard any opinion on it.

Although personal bar is referred to separately in ground (c), I did not understand Mr Abercrombie to maintain that that ground could succeed if ground (b) failed. In these circumstances it is unnecessary to say anything further about it.

Mr Abercrombie did maintain that ground (a) was independent of ground (b). However, he did not elaborate on the broad submission that it was unreasonable in the Wednesbury sense for the respondents, having issued the Guidance Note, to insist on the removal of the petitioner from the waiting list as a precondition of the grant of the corporate application. This amounted to a submission that, having failed to include in the original version words to the effect of those inserted in the revised version, it was unreasonable for the respondents to insist on that aspect of their policy contained in paragraph 3.4.1.3 of the Council Solicitor's report. If, however, the original Guidance Note, as I have held, did not contain the representation contended for, it cannot, in my view, successfully be maintained that it was unreasonable in the Wednesbury sense to enforce a policy the terms of which could readily have been ascertained by enquiry. The policy itself, including that aspect contained in paragraph 3.4.1.3, is not complained of as unfair. Nor is any complaint made of procedural unfairness.

In the whole circumstances there are, in my view, no averments relevant for inquiry. I shall sustain the respondents' first plea in law and dismiss the petition.