Fleets are being urged to join a campaign that could see private parking companies forced to pay back the cash collected from penalties.
Cambridge law graduate Michael Green claims that private parking companies – used by supermarkets, hospitals and businesses to enforce parking regulations – are breaking the law by employing unfair contractual terms.
He argues that the charges levied at at-work drivers and private motorists for staying longer than their permitted time in no way represent the loss incurred by the operator. Green, founder of the Challenge the Fine campaign, told Fleet News: “It is dubious that fining drivers £40, £80, £100 is legal.”
If a parking charge applies from the moment a driver parks and pays for a period of time but overstays by 10 minutes, “the charge for staying an extra hour would perhaps have been another 40p or 50p,” he said. “The car park operator has suffered that loss, not £100.” In total, Green estimates that these companies will collect around £176m in so-called 'fines' this year, almost double the £93m collected in 2010, and more than an 800% increase on 2006, when just £21m was charged to motorists.
Green said: “The fact is, if you over-stay by two minutes operators only have the right to ask for money lost, but they are slapping drivers with enormous charges. I think this is unlawful and I am set on fighting these companies to set some proper legal standards.”
Green wants to launch a class action – a civil litigation device that allows multiple parties to sue over the same legal grounds – against the private parking industry.
He continued: “Most people do not know enough about the law to question a ticket’s legality, so the companies are free to engage in sharp business practices with impunity.”
By gathering the cases together and taking it to the High Court – rather than an individual taking case in the County Court – he hopes to set a legal precedent. He said: “Fleets and at-work drivers who have lost money need to know that there is a way to fight the aggressive parking firms."
He is urging them to join more than 5,000 others, who have already signed-up to the online campaign, by submitting their email address and the amount they paid. FN50 data showed that 19 leasing companies processed just over 124,000 fines last year, totalling more than £7.2m if all fines were £60.
However, a survey by ACFO suggested six out of 10 fleets do not appeal parking charge notices issues by either local authority or private company organisations.
Yet, those companies that do often report a success rate of up to 50%, saving the company thousands of pounds.
ACFO has called on leasing companies to improve their administration processes to ensure fleets are given the opportunity to appeal tickets.
The body responsible for dealing with parking appeals on private land across England and Wales has seen a 12-fold increase in appeals in the past year according to its annual report for 2013/14.
The Parking on Private Land Appeals (Popla) service was established in October 2012 to consider appeals from motorists relating to charges for parking on private land, such as supermarkets or hospitals.
Last financial year, 25,214 valid appeals were registered and 23,500 appeals were decided. Of these, 10,661 (45.37%) were allowed and 12,839 (54.63%) were refused.
However, the number of appeals is very small in comparison to more than two million requests received by DVLA from private parking operators for vehicle and owner details.
Ahead of any class action, the focus will turn to a Court of Appeal decision due next year following a county case in which two drivers argued – and lost – their case after they were each fined £85 for overstaying at the car park of the Riverside Retail Park in Chelmsford, which is managed by Parking Eye.
Green said: “It could be a landmark ruling. The Court of Appeal hearing will decide whether these tickets are legal. If the appeal says the tickets are unlawful, we will then argue every ticket ever paid out ought to be refunded and take this to court with the class action.”
Earlier this year ACFO held a fines seminar reflecting the problems facing employees and employers when handling penalty tickets relating to parking breaches and motoring offences.
ACFO chairman John Pryor said: “We wish Mr Green well in his class action. He has contacted ACFO and we have decided that it is up to individual members and fleet decision-makers generally to decide whether or not they want to join his campaign.”
Whether or not the class action goes ahead will also be determined by the support as lawyers taking the case do so on a 'no win, no fee' basis.
If the case is successful, Green says all registered charges would be refunded to petition signatories who signed up with 20% of the proceeds going towards legal and operational costs.
He explained: “The ideal situation is that people who have been unfairly charged will get their money back, and the current charging structure will be radically overhauled. This is an industry that really needs legal accountability.”
Fines down by £10m but councils collect more
Councils in England collected £10 million less from parking fines, but increased overall income from parking by £21m to more than £1.4 billion. The figures from the RAC Foundation for 2013/14 show that the local authorities received £343m in fines compared to £353m the previous year – a fall of 3%.
Almost three-quarters – 71% or £242m – came from London, but this was also down on the previous year. The research suggests a 4% fall, despite London councils issuing 4.08 million tickets, marginally more than they did in 2012/13.
The RAC Foundation claims that, after costs, councils in England generated a combined profit of £667m from on and off street parking operations in 2013/14 – a 12% increase on the £594m collected the previous year. And, even after allowing for capital charges (interest and depreciation), the combined surplus in 2013/14 was still £549m – a 19% increase on £460m for 2012/13.
Although not all councils made a large surplus, very few lose money on their parking activities. Just 55 (16%) of the 353 parking authorities in England reported negative numbers.
The authority with the largest surplus in 2013/14 was, once again, Westminster with £51 million.
The five biggest earners were all London authorities, with only Brighton and Hove and Nottingham – thanks to its workplace parking levy – breaking into a top 10 dominated by councils in the capital.
Professor Stephen Glaister, director of the RAC Foundation, said: “Parking profits seem to be a one-way street for councils having risen annually for the last five years.
"Yet over the same period spending on local roads has fallen about a fifth in real terms.
“Parking policy and charges must be about managing traffic not raising revenue.”