Car Hire Agreements - TfL & PATAS re-writing law?!

[Marincor]

I want to bring to the attention of the Caggers a practice by TfL that I believe has serious implications for Car Hire Agreements. I’ll explain.

 

A friend of a friend brought to my attention that TfL has been telling Car Hire firms that they are liable for Congestion Charges and PCNs if the agreement they have with the hirer is for more than a 6 month period. TfL stated the following to support their assertions:

 

Section 66 of the Road Traffic Offenders Act 1988, which is the adopted definition used by the Road User Charging Regulations, requires that a hire agreement must be for a fixed period of less than six months to enable the transfer of liability when a vehicle is on hire.

 

We would like to bring to your attention that since the hire period shown on the agreement is for a period of six months or greater, the document does not fall within the definition of a hire agreement and therefore liability cannot be transferred to the hirer of the vehicle.

 

The gentleman concerned had made an appeal to PATAS and surprise surprise, the adjudicator from that collusive organisation supported TfL’s stance. It must be borne in mind that TfL is the ONLY local authority making this assertion.

 

Straightaway I saw the ramifications of such a ruling as PATAS has effectively allowed TfL to re-write contract, hire agreement and statute law to support their stance.

 

I decided to prepare a Request to Review for him to file in December of last year. In between waiting for a confirmation, the gentleman received a letter from TfL which was clearly a desperate attempt to sway the PATAS as it stated nothing new and attempted to cast aspersions on the legality of the Review.

 

The review was allowed but PATAS eventually replied to my detailed submission supporting TfL – surprise surprise – citing the very same section TfL quoted as meaning Hire Agreement contracts can only be for 6 months.

 

The regulation is Section 66(7) of the Road Traffic Offenders Act 1988 which states,

 

This section applies to a hiring agreement under the terms of which the vehicle concerned is let to the hirer for a fixed period of less than six months (whether or not that period is capable of extension by agreement between the parties or otherwise); and any reference in this section to the currency of the hiring agreement includes a reference to any period during which, with the consent of the vehicle-hire firm, the hirer continues in possession of the vehicle as hirer, after the expiry of the fixed period specified in the agreement, but otherwise on the terms and conditions so specified.

 

Now as you can clearly read in the first line it states This section applies to a hiring agreement under the terms of which the vehicle concerned is let to the hirer for a fixed period of less than six months.

 

Now anyone reading that would believe that section only applies to hire-agreements that are for a period of 6 months or less which means it wouldn’t apply to the gentleman’s hire agreements which are for a year. Yet the PATAS adjudicator states,

 

Therefore for liability to be transferred to the hirer, the Hiring Agreement must be for less than 6 months.

 

I don’t know how TfL & PATAS can interpret the regulation above as such! Am I being Blind? Dumb? Stubborn?!

 

I made a detailed submission citing various pieces of legislation I felt were relevant which the adjudicator wrote “wrong”, “mistaken”, “misconceived”, without providing statutory evidence to support his stance and wilfully ignoring valid legislative aspects of the appeal.

 

I am willing to post the appeal and the reply for further scrutiny but before I tell the gentleman to consider a High Court Review, I am posting the basic argument here, on Pepipoo and Moneysavingexpert for feedback in light of the implications.

 

Quite simply, are TfL and PATAS right?

 

If it will be a High Court review, I will be advising the gentleman to pool the resources of other hire companies finances as it will affect them as well.

 

Also, whilst I await a response, do you pay the PCN if you intend to go for a HCR or make TfL know it is still being contested?

[Raykay]

Congestion Charge or PCN? They are covered by different legislation.

[j66]

When I worked in car rental, no rental agreement was allowed to run for longer than 28 days, we did a new rental agreement every 28 days and quite often changed the vehicle as well.

[steampowered]

After reading s66 of the Act I agree with TfL's interpretation. My reading of the Act is that liability for the charges is imposed by sections 63-65 not by section 66 (although the Act only talks about fixed penalty notices not congestion charge).

 

Sections 63-65 of the Act seem to allow fixed penalty charges to be recovered from the owner of a vehicle.

 

Section 66 creates an exception to that rule. Section 66(4) says that it is the hirer who is liable not the owner. But section 66(7) says that this exception only applies where we are talking about a hire agreement of less than six months.

 

Since your friend can't rely on section 66, the usual rules in 63-65 apply and hence he is liable to pay the charges as owner of the vehicle.

 

Can't your friend charge the cost back to the customer? There should be an indemnity in his T&Cs for this kind of thing.

[Marincor]

We are talking Congestion Charges here and unless I misunderstood Steampowered, it was TfL relying on Section 66 to justify their enforcement, not the hirer to protect him. So if Sections 63-65 allow Tfl to do so, then again they and PATAS are incorrect because they both stated Section 66 as justification.

[Marincor]

Also, most of the hire agreements I have seen over the years are for a year and at least 6 months.

[Marincor]

I made the argument on the basis of an agreed contract and ownership of the vehicle under contract at the time of the ConCharge/PCN issue and cited various legislation that made reference to 'Statement of Liablity', which is in effect what the hirer of the vehicle signed with his hire agreement.

 

After reading your submissions I find it disconcerting that TfL - or anyone else for that matter - has a right to intercede into a contract wilfully entered. However if you require the full details, let me know and I will upload them.

[Raykay]

I made the argument on the basis of an agreed contract and ownership of the vehicle under contract at the time of the ConCharge/PCN issue and cited various legislation that made reference to 'Statement of Liablity', which is in effect what the hirer of the vehicle signed with his hire agreement.

 

 

One complication is the difference in the legislation. For PCNs, the owner/keeper is liable. For the congestion charge it is the registered keeper.

[steampowered]

Yes, the Act you mentioned only refers to PCNs. I'm not sure how it relates to congestion charges.

[Marincor]

Ok, I see what you are saying steampowered - there is a difference in enforcement ownership practice for PCNs to Congestion Charges.

 

However, seeing as the Road User Charging (Charges and Penalty Charges) (London) Regulations 2001 Regulation 6(b) clearly references 'Statement of Liability' as does the Road Traffic Offenders Act 1988 Schedule 4(1)(2) - both of which I quoted in the appeal - isn't this a valid argument for the hirer of the vehicle to be liable especially when the Hire Agreement signed included the following text:

 

“Any parking infringements/contraventions are the sole responsibility of the driver and all fines must be paid within the relevant period set by the charging authority”.

 

Also bear in mind "the act you mentioned" is the Act brought up by TfL, I merely attempted to challenge their & the PATAS assertions regarding its relevancy in relation to the gentleman's hire agreements.

[Marincor]

UPDATE: I've read the 'Autolease Limited vs the London Borough of Barnet and Other Cases’ and after doing so I've adivsed the gentleman concerned to bite the bullet and restructure his business to ensure he doesn't fall foul of the various stipulations.

 

Though I still can't shake the uncomfortable feeling of corporate yet again corralling us to their will!