Scottish Court of Session Decisions

[1] The petitioner seeks judicial review of certain actings of the respondents, the City of Edinburgh Council. On 5 November 1999, the Lord Ordinary dismissed the petition as irrelevant. The petitioner reclaims.

[2] The respondents are the authority responsible for issuing taxi licences, and taxi driver's licences, in Edinburgh. The petitioner has held a taxi driver's licence since 1993, and in that year he also went on to a waiting list which the Council keep, for those who want to obtain a taxi licence. In October 1997, the Council's Licensing Committee adopted new procedures for dealing with taxi licence applications and the waiting list for taxi licences, all as detailed in paragraph 3.4 of a report by the Council solicitor. The new procedures allowed for taxi licences held by individuals to be replaced, at their annual renewal date, by a new licence in the name of a partnership or limited company which included the existing licence holder.

[3] In May 1998, the petitioner entered into partnership with two partners, one of whom, a Mr. Coulman, was the holder of a taxi licence. In terms of the contract, the partnership commenced in June, and shortly thereafter applied for a new taxi licence, in name of the partnership. On 7 August, the application was granted, subject to the surrender of Mr. Coulman's existing licence. This was in accordance with the procedures set out at paragraph 3.4.1.1 and 3.4.1.2 of the report.

[4] The new procedures included a third substantive requirement, at paragraph 3.4.1.3, to the effect "That any partner or director of the corporate applicant who is presently on the Council's waiting list must agree to give up their position or positions on the list." By a letter to the petitioner dated 29 July 1998, it was noted that he was at present on the waiting list. The letter continued as follows:

The petitioner protested to 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 would not proceed. On 3 August he wrote confirming that his name might be removed from the list. The grant of the application followed upon the removal of his name.

[5] The passage which I have quoted from the letter of 29 July 1998 is described in the petition as a "decision". At article 18 of the petition it is said that the petitioner challenges the said decision. This is upon three stated grounds, of which the third is no longer insisted in. By the petition, the petitioner seeks both an order ordaining the Council to restore his name to the waiting list with the same ranking he would have had "had his name not been removed pursuant to said decision", and also a declarator that the Council should not have insisted in the letter of 29 July 1998, as a precondition of granting a licence to the firm, that the petitioner agree to give up his position on the list.

[6] As the Lord Ordinary observes, the quoted words were not in the form of a decision by the Council. It was, however, apparently accepted in the discussion before him that it was amenable to judicial review. In responding to the reclaiming motion, counsel for the Council did not seek to withdraw that concession. I shall return to that matter: I am not persuaded that the concession is rightly made.

[7] As I have mentioned, the petitioner's position is that he was unaware of the requirement that a partner of a corporate applicant must give up his position on the waiting list. It is accepted that the new procedures, including this explicit requirement at paragraph 3.4.1.3, were available to the public and could have been examined by the petitioner or his solicitor; but this had not been done. It is moreover acknowledged that the new requirements, which I shall refer to as "the policy", are not in this or any other respect unreasonable or otherwise open to challenge.

[8] The policy not being open to challenge, the Council would of course normally be entitled to insist upon compliance with its requirements if an application was to be considered and granted. In construing the letter of 29 July as a "decision" enforcing the policy, and contending that the Council were not entitled in the circumstances to enforce the policy in this respect, the petitioner founds upon the terms of a "Guidance Note" issued by the Council in late 1997 or early 1998, after the Council's Licensing Committee had adopted the new policy. In particular, he founds upon the fact that the Guidance Note provided information as to the requirements of paragraphs 3.4.1.1. and 3.4.1.2 but made no mention of the requirement set out in paragraph 3.4.1.3. The petitioner and his solicitor were entitled to rely upon the terms of the Guidance Note, and had done so. It was these circumstances which exposed enforcement of the policy to challenge, upon the two stated grounds still relied upon by the petitioner. First, no reasonable Council, having issued the Guidance Note, would insist on the removal of the petitioner from the waiting list as a precondition of the grant of a licence to the firm. And further and in any event, by issuing the Guidance Note, the Council created a legitimate expectation that a partner or director of a corporate applicant would be entitled to remain on the waiting list. The Council should not in these circumstances have insisted that his name be removed in order to permit the corporate application to proceed.

[9] Before I come to the submissions advanced in support of these contentions, it is to be noted that upon receipt of the letter of 29 July, the petitioner could have refused to agree to the removal of his name from the waiting list. This would evidently have resulted in refusal of the partnership application. That refusal would clearly have been a decision of the Council, open to judicial review. In a judicial review of that decision, the terms and effect of the Guidance Note could have been relied upon in much the same way as in the present petition. In agreeing, after protest, to the removal of his name from the waiting list, the petitioner may well have adopted the course which was more sensible in his own interests: he and his partners had effectively committed themselves to the partnership replacing Mr. Coulman as taxi licence holder. Remaining on the waiting list was, however, a central element in the petitioner's plans: upon reaching the top of the list and being granted a taxi licence as an individual, he intended to retire from the partnership and trade as a licence holder on his own account. Nonetheless, whatever the pressures and whatever his intentions, the choice which he made, in agreeing to removal of his name, was his and not the Council's. And while, at an earlier stage, relying upon the Guidance Note, he, and perhaps more surprisingly his solicitor, had been unaware of the terms of the Council's actual policy, by the time he made his choice he was no longer relying upon the Guidance Note and knew of the requirement contained in the policy.

[10] In these circumstances, I am not persuaded that the paragraph which I have quoted from the letter of 29 July was in any proper sense a "decision" of the Council, or susceptible to judicial review. Having received the firm's application, the Council were approaching the stage when (if the application was not withdrawn) they would have to take a decision - to grant or refuse the application. By writing as they did, to a partner of the applicant firm whose name was on the waiting list, they were, in my opinion, simply notifying him of the terms and effect of the relevant paragraph of their policy. It was then up to him to decide what to do. What followed - the decision to grant the application - followed upon his decision to allow his name to come off the waiting list. The issuing of the Guidance Note, like the adoption of the policy, is not said to be open to challenge by judicial review. It is taken as a datum, and indeed treated as having effectively altered and limited the powers of the Council. On 29 July, a decision was impending; but in my opinion no decision was taken or expressed on that date. Notwithstanding the concession made by the Council, that would suffice to justify dismissal: the pleadings do not, in my opinion, reveal any issue susceptible to judicial review. Having regard to the concession, and the submissions made to us, I think it is appropriate to consider those submissions. But before doing so, I would observe that the absence of anything that can properly be seen as a decision has produced a degree of confusion and uncertainty as to what the real issues may be.

[11] It is convenient to deal first with the submission that by issuing the Guidance Note, the Council created a legitimate expectation that a partner of a corporate applicant would be entitled to remain on the waiting list. Counsel accepted (as the Lord Ordinary held, referring to the Opinion of Simon Brown L.J. in R. v. Devon County Council, ex parte Baker, [1995] 1 All ER 73 at page 88) that he could only succeed if the Guidance Note contained "a clear and unambiguous representation upon which it was reasonable for him to rely", to the effect that a partner such as himself would be entitled to remain on the list. It was accepted that the Guidance Note contains no express representation of this kind. But it was submitted, and not disputed, that in principle the required representation could be clear and unambiguous, although only implicit.

[12] In making his submissions, counsel drew a distinction between the partner who was an existing licence holder, who in terms of paragraph 3.4.1.2 of the policy must agree to surrender his existing licence, and any other partner who might be on the waiting list. Describing the former for convenience as "the transferor", counsel submitted that the Guidance Note contained a clear and unambiguous implicit representation that a person on the waiting list other than the transferor would not be affected by the making of the corporate application. It was accepted that this formulation of the implicit representation included a representation that some people on the waiting list would have to give up their place - namely, anyone who was a transferor. It was not entirely clear to me why this slightly complicated formulation, including an exception, was adopted in identifying the implicit representation. The Guidance Note says nothing in paragraph 3.4.1 about the waiting list, and a simpler approach might have been to suggest that there was an implicit representation that no one on the waiting list would be affected. I am content to proceed upon the basis that a clear and unambiguous representation in either form would suffice for the creation of a legitimate expectation in corresponding terms.

[13] In approaching the question of implicit representation, the Lord Ordinary considers first the purpose of the policy. He says that 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; and treating that as a general purpose, going beyond the mere surrender of a particular individual licence when a corporate licence replaced it, he says that if those on the waiting list were to be wholly unaffected, 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, he says, would clearly be contrary to the general objective of the policy. It was not unlikely that in one way or another the Council would seek to prevent the general objective being undermined, and 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. Upon that basis, he says that that proposition was in his view implicit in the Guidance Note; or that, in any event, any contrary proposition (that such a person would not be affected) was not implicit in it. Counsel for the petitioner and reclaimer submitted that the Lord Ordinary was in error on these matters.

[14] As regards the policy (as opposed to the Guidance Note) I am not sure that I would go as far as the Lord Ordinary does in identifying its general objective. Where an individual held a number of licences, and converted one into a corporate licence, he could retain the others concurrently with it unless there were legal grounds for depriving him of any such licence. The Council had no choice but to accept that such a situation might occur. The presence of paragraph 3.4.1.3, apparently requiring all partners of a corporate applicant, including the transferor, to come off the waiting list might nonetheless point to an overall objective of the kind described by the Lord Ordinary. But it might also have other explanations, relating more directly to the way in which the waiting list operated. At all events, in considering what was or might be implicit in the Guidance Note, as a representation upon which it was reasonable to rely, I am not persuaded that anything is to be gained by scrutiny of the policy, which ex hypothesi a person relying on the Guidance Note would not be aware of or have in mind. Counsel for the petitioner and reclaimer emphasised that the "omission" of any reference to the waiting list or the requirement in paragraph 3.4.1.3 was in sharp contrast to the treatment of the requirements in the other substantive paragraphs. But again, I do not think that the implications of the Guidance Note are to be discovered by contrasting it with the policy.

[15] Looking to the Guidance Note itself, the primary submission for the petitioner was a simple one. The Guidance Note was concerned with the new type of licence in the name of a partnership or company. It was made plain that such a licence would replace an existing individual licence. Nothing was said about the waiting list or those whose names were on it. There was nothing to suggest that the new arrangements would affect such people. The implication was that they would not. In submitting that the implied representation was not quite so simple and included an indication that the position of a transferor on the waiting list would or might be affected, counsel pointed to the second paragraph of the Guidance Note, which he suggested showed the purpose of the new provision for corporate licences. In that paragraph, it is said that the Council "believes that a small number of licence holders may take this opportunity to take on partners with a view thereafter to retiring both from the trade and their partnership." The hope is expressed that the proposals would address "the growing and unhealthy situation whereby taxi licences are held by individuals who have little or no day to day contact with the businesses carried on under the authority of the licence." It is said that in future, it is expected that the individuals represented in a corporate licence will be actively involved in the trade, and will have more incentive to bear certain increasing costs. It was submitted that the purpose of the new type of licence was thus identified in the Guidance Note as being a mechanism for persons approaching retirement to disengage from the taxi trade and for bringing in as participants in a corporate licence persons actively involved in the business. In the context of that identified overall purpose, it was implicit that the transferor of an actual licence was to be someone who was moving out of the taxi trade, in which case it was implicit also that if he was on the waiting list for another licence, his acquisition of such another licence was inappropriate, and he should come off the list. But so far as anyone else was concerned, it was clear that as incoming partners, they would be actively involved in the trade in the future, in which case there was no reason why their position on the waiting list should be affected, if they still wished to acquire a further individual licence.

[16] In relation to the small number of licence holders who might take on partners in the way envisaged in this paragraph, I can at least follow the submission which was made. But the "growing and unhealthy situation" which is identified relates to the inherent characteristic of individual licence-holding, that the individual holder will with the passage of time be likely to become less actively involved and have less incentive to meet costs. That is not a merely current problem: it is an undesirable aspect of individual licence-holding. Corporate licences are seen as a way of bringing in new, active licence holders, as well as "easing out" the less active. And it is obvious, to my mind, that those interested in coming in by this route are likely already to be on the waiting list.

[17] I am not persuaded that there is any implication in the Guidance Note that catering for this particular situation is the sole purpose or use of the new form of licence. Even if such an implication can be read into the Note, I am quite unable to see it as clear or unambiguous. And in any event, any such implication, in my opinion, falls far short of the positive representation which is required, and which readers of the Note would be entitled to rely upon, that persons on the waiting list (whether the transferor or not) would not be affected by joining in a corporate application. At best, it appears to me that counsel for the Council was well founded in submitting that the Guidance Note was quite simply silent and neutral upon that point. If a person on the waiting list were to read the Guidance Note, and contemplate joining in a partnership application with an existing licence holder, it appears to me that he might well ask himself whether it would be open to him to adopt that route towards a licence, in addition to following his existing route via the waiting list. If he then read the Guidance Note, with that question in his mind, he would in my opinion find nothing which would tell him the answer. He might, I suppose, get as far as saying to himself that he could see no reason why he should not pursue both routes, and might even feel optimistic that it would be all right - although I think he would realise that individual licences were not regarded as satisfactory, and that the new route provided for interested parties might be an alternative rather than an additional way in to the taxi operating business. But the suggestion that he would find a clear and unambiguous representation that as a person on the waiting list he would be unaffected seems to me to be without any foundation. He would see at the end of the Guidance Note a statement that any enquiries in connection with the new procedure should be addressed in writing to the Council solicitor. I can see nothing in the rest of the Guidance Note indicating that that was unnecessary or that he was clearly unaffected.

[18] I would add one further point in relation to the issue of legitimate expectation and reliance upon representation. I do not doubt that the terms of a Guidance Note, issued in order to explain some newly adopted policy, might be so expressed that anyone reading it would effectively be told that they could rely on the terms of the Guidance Note, without referring back to the policy itself, in some particular respect. But speaking generally, a Guidance Note is just that: it is not put forward as the document determinative of rights. In that context, therefore, it appears to me that in order to create a legitimate expectation, based upon a clear and unambiguous representation, the implication would have to be very clear indeed. Guidance Notes are of course intended to be relied upon, in various ways and to varying extents. But in my opinion the general expectation must be that they are an aid or introduction to an understanding of the primary document, and not to be relied upon without recourse to the primary document, unless there is a very plain indication that that is the intention. Having regard to this general consideration, I am confirmed in my conclusion that the Guidance Note contains no representation of the kind which is required.

[19] The other ground of challenge is to the effect that no reasonable Council, having issued the Guidance Note, would insist on the removal of the petitioner from the waiting list as a precondition of the grant of a licence to the firm. That proposition is not concerned with legitimate expectation. It is advanced upon the basis that the Guidance Note, even if containing no representation of the kind which gives rise to legitimate expectation, has the effect of making it unreasonable, in the Wednesbury sense, to give effect to paragraph 3.4.1.3 of the policy. The submissions in this respect appeared to me to become either submissions as to representation and legitimate expectation, indistinguishable from the other ground of challenge, or to entail a challenge to the reasonableness of the policy itself or of paragraph 3.4.1.3 in particular. But neither the policy as a whole, nor the inclusion in it of paragraph 3.4.1.3 is said to be open to challenge. The exact reasons for including paragraph 3.4.1.3 may be unclear (although I think it would have been strange, in view of the identified problem to which individual licences lead, if the waiting list route to new individual licences had been left untouched). But counsel for the petitioner did not suggest that the Council had had no power to adopt the policy, including that paragraph. And in the result, I am unable to find any basis for this ground of challenge.

[20] In the whole circumstances, I would refuse the reclaiming motion and adhere to the interlocutor pronounced by the Lord Ordinary.

[1] I agree with your Lordship in the chair that the concession made in the court below and before us was wrongly made and that the letter of 29 July 1998 cannot properly be viewed as intimating a decision of the respondents which is susceptible to judicial review. On that short ground, and since, of course, the court cannot be bound by a concession in law, this reclaiming motion must be refused. Had the reclaimer opted to remain on the waiting list for a taxi licence in his own name and as a result been refused a corporate licence, that would have been a decision which might well have been reviewable; but I mention this only to point up the distinction between that situation and that which obtained in the present case.

[2] For the rest, the position is inherently unsatisfactory in that any remarks which one makes must proceed from what is, in my view, a wholly artificial base. However, on the supposition that the contents of the letter in question can be read as some sort of decision requiring the reclaimer to delete his name from the waiting list as a condition of being granted a corporate licence, I should, myself, be rather more sympathetic to the argument which was, I think, eventually advanced, namely that the imposition of the condition defeated a legitimate expectation derived from the Guidance Note that the reclaimer's right to apply for a corporate licence would not be qualified in any wholly extraneous manner. In saying that I do not intend to depart in any way from the test summarised by Simon Brown L.J. in the case referred to by your Lordship. As to whether the condition in question is properly to be viewed as wholly extraneous, much clearly depends on what one perceives as being the general policy expressed in the Guidance Note. To some extent this must be a matter of impression and my own impression is that the policy, as so expressed, is directed neither at multiple nor at individual licence holders, as such, but only at the "small number of licence holders" who are contemplating retiral. Viewed in that light there was, in my opinion, no reason whatever why someone in the position of the petitioner, reading the Guidance Note, should have appreciated that applying for a corporate licence might in some way disable him from remaining on the waiting list for a separate licence in his own name. All that said, I agree entirely that for the reason given above this reclaiming motion should be refused.

I agree with the Opinion of your Lordship in the chair in its entirety and there is nothing I can usefully add.