Are parking tickets, charges or 'fines' illegal?

Michael Green

  • 04/10/2014

Isn't it ironic that this sign is just outside where I work in London?

I want to discuss the often-repeated claim that private parking tickets are 'illegal', unenforceable or a scam. That's not quite correct. The truth is that no-one knows whether they are enforceable (and therefore a scam), because no English court with power to definitively answer this question has done so. Yet.

What people mean to say is that these tickets are arguably unlawful. There is no binding precedent in this area, so it is incorrect and misleading to state with dogmatic certainty that these tickets are unenforceable.1.

In my view they're unlawful. The most serious legal objection to them (which affects almost every – if not every – private ticket ever issued) is that they breach something known as the 'penalties doctrine'.

Let's imagine you own a car park and someone parks in it. You've put a sign up saying that no-one can stay longer than 2 hours. Someone overstays and so breaches the (implicit) contract between you and them2. The penalties rule means that if you charge that person for that breach of contract, you can only recover the amount you've lost. So when someone overstays by ten minutes, you can charge them for the extra 10 minutes parking (and maybe the minor administrative costs incurred in chasing them up)3.

I wonder then where the £100 or £150 charges come from? Is it...maybe because the tickets are legally dubious?

The judges in the lower courts – note they have no power to make binding law – have differing opinions about whether private parking tickets fall foul of the penalties rule. Some have concluded that the tickets are unenforceable, and others have concluded the opposite4. They are not consistent in answering this question because the law in this area is not clear.

There is a Court of Appeal case next year that will clarify this issue, and will answer the biggest illegality question looming over the companies' heads. It will be the first time the penalties rule will be tested against private parking tickets in an appellate court5.

So what if next year the Court decides these tickets breach the penalties rule? Does everyone else who has paid over get his or her money back?

Intuitively you'd think yes – all of these hundreds of thousands of parking tickets have been illegal from the very start – of course they should!

Let's take the law out of this for a second. There is no shot the parking companies will voluntarily refund everyone, should the tickets turn out to be unlawful. That would be asking them to refund over £100 million to the hundreds of thousands (if not millions) whom have paid out.6 It would certainly be a gloomy shareholder report.

Because we can't rely on them for a voluntary refund, we ought to bring the law back into it. Would the law require them to refund everyone? The law does not provide a clear answer here either.

This is what ChallengeTheFine is about: if next year's appeal concludes the tickets are unlawful, we will then argue that every ticket ever paid out ought to be refunded. This would include tickets that were paid over more than 6 years ago, which would be an exception to the normal 'time limit' rule in English law7 . This is using the law of restitution, an area of the law that is relatively new and uncertain in scope. The Parking Companies will undoubtedly argue they do not need to refund anyone, or if so, only tickets paid within the past 6 years, but that's for a court to decide.

1. The leading authorities on the penalties doctrine in English law do not concern consumer contracts, let alone private car parking tickets: Parking Eye Ltd v Beavis (19 May 2014), at [7.3]
2. Some might dispute whether there is a contract at all in this situation: I'm assuming one to illustrate how the penality doctrine works.
3. It is possible that these costs are not recoverable either.
4. Contrast Parking Eye Ltd v Beavis (19 May 2014) (ticket is legal) with Parking Eye Ltd v Heggie (13th December 2013) (ticket is unenforceable penalty).
5. Parking Eye Ltd v Beavis will be heard by the Court of Appeal in February
6. This is (incredibly conservatively) estimating an annual revenue of £20m between the parking companies annually, going across 6 years in refunds. Parking Eye's 2013 revenue alone was £14.2m: see footnote 1 at [3.5]
7. Any legal dispute older than 6 years, as a default rule, is time-barred under the Limitations Act 1980. The tickets case we want to bring would appear to be an exception under section 32(1)(c), with no time bar applicable.