Pump Court Chambers

Transport For London v Uber London Limited & Licensed Taxi Drivers Association & Licensed Private Hire Car Association [2015] EWHC 2918 (Admin) 1449

Blog 23rd February 2016

The judgement given by Ouseley J. sets out the interesting background for what is a revolutionary development in travelling by taxi in London. In May 2012, Transport for London, licensed Uber as a private hire vehicle operator in London. It is an offence under s11 of the Private Hire Vehicles (London) Act 1998 for a licensed PHV to be equipped with a taximeter, that is, a device for calculating the fare to be charged for any journey. The LTDA and LPHCA contended that private hire vehicles operating within the Uber network were equipped with taximeters, in contravention of the criminal law. TfL and Uber both disagreed. A private prosecution to test the matter was initiated by the LTDA. Those proceedings were adjourned and subsequently withdrawn so that there could be a declaration in the Administrative Court on statutory construction. The law stipulates that a PHV in London which must not be equipped with a taximeter, but it does not prohibit a driver from using such a device if it is not part of the vehicle’s equipment.

Ouseley J: ‘Uber signs up both licensed private hire vehicle drivers and licensed black cab drivers who are then able to carry out the bookings accepted and referred to them by Uber. The booking and customer billing process involves the customer using the Customer App and the Driver using the Driver App; both Apps licensed by an Uber related company. The Driver App has to be installed on the driver’s Smartphone, either rented from Uber or the driver’s own Smartphone. A driver using his own Smartphone can use it for the range of other purposes for which a Smartphone can be used. Smartphones rented from Uber however are disabled from making calls or sending text messages and allow only access to the Driver App and other relevant applications such as the navigation App. Those who rent the Smartphone are supplied with a phone cradle for the vehicle but are not required to use it. The driver can keep the Smartphone where they want to during the trip. The Smartphone does not have to be visible to the customer at any time. The customer obtains the Customer App by registering certain personal details with Uber and providing a valid credit or debit card number. Once registered, the customer can use the Customer App.’

‘When booking, the customer can choose a particular type of vehicle. The nearest vehicle of that type available for hire will be shown on the Smartphone screen. The customer then indicates precisely where they want to be picked up, and clicks “request” to make the booking. Uber accepts the booking and Uber’s servers in the United States locate the nearest available vehicle of the type requested by the customer. The servers then send the accepted booking to the Smartphone of the nearest driver, who has 15 seconds to accept the booking. If he does not accept it, the server sends the booking to the Smartphone of the driver of the next nearest vehicle to the customer. When the driver takes on the booking, he is sent all the relevant details including the location. He can contact the customer via the Driver App but not via the customer’s mobile number. The customer is sent also by the Customer App details of the driver, car and estimated time of arrival.’

‘Once the driver has picked up the customer, the customer, if he has not already done so, provides the driver with details of the desired destination. The driver puts this on to his Smartphone and clicks the “begin trip” icon on his Driver App screen. If the car hired is a black cab rather than a private hire vehicle, the driver clicks on the icon and starts his taximeter simultaneously. If the Customer App is left open during the trip, the customer will see the name and photograph of the driver on the Smartphone screen as well as the intended route and estimated time of arrival. The customer cannot see the fare during the trip and no running fare is displayed on their Smartphone or that of the driver. But if they are in a black cab booked through Uber, they can see the taximeter with the fare running in the usual way.’

‘At the end of the trip the driver presses the “end trip” button on the Driver App screen on his Smartphone. If the vehicle is a black cab, the driver will be prompted to enter the fare shown on the taximeter on his Smartphone through the Driver App. That is the fare. However if the vehicle is a private hire vehicle the fare is calculated by Uber’s servers, to which I shall come. The fare is not calculated and displayed on a running basis, as with a black cab taximeter. The customer will be sent a fare receipt by email within seconds of the trip ending. The receipt shows the total fare charged, a map of the route, distance travelled and time taken. It provides a breakdown of the fare showing the costs of the trip, the base fare, distance and time. The fare is automatically charged to the credit or debit card of the customer. The information about the total fare charged is sent by Uber’s service to the driver on the Driver App at the same time as the customer receives his receipt. There are ways in which issue can be taken by the customer with the fare charged in this way.’

‘The issue in this case relates to how the fare is calculated for PHVs on the Uber network, and not to black cabs on it. The calculation is carried out by one of two servers operated by Uber in the United States. Signals are sent to the servers by the driver’s Smartphone, providing GPS data from the driver’s Smartphone, and time details. Server 2 calculates the fare to be paid using what Uber calls its fare calculation model, effectively a software based algorithm. Server 2 determines which fare structure applies, in this case the London fare structure. It obtains the structure from the fare structure in Server 1 which keeps the long term data for Uber. In London there is a base fare and an additional fare. The base fare depends on the type of PHV used. The additional fare is calculated by adding the total time taken to complete the trip at a particular amount per minute depending on the vehicle plus the total distance travelled charged at a particular amount per mile also varying with the type of vehicle. There may be a further component to the additional fare depending on whether “surge pricing” is in operation, to which the customer is alerted in advance. If so, a multiplier is applied to the additional fare. Surge pricing applies and it may apply for a very short period only, a matter of minutes sometimes, so that higher prices are charged during times of high demand for drivers; the aim is to encourage more drivers to be available at particular places. Any further tolls such as airport car parking are added, promotional offers are assessed and where applicable the fare reduced accordingly. Some fares are charged at a flat rate such as trips to the London airports. It is then for the server to send its calculated final fare to the customer and private hire driver simultaneously. No fare can be calculated during a network outage.’

‘A black cab fare also comprises a base fare with an additional fare calculated using distance and time but these metrics are recorded by the taximeter which is integrated and sealed into the mechanics of the black cab and the calculation is performed by the taximeter as the journey progresses.’

‘The question for decision in the light of those agreed facts is whether the Uber PHVs are equipped with a taximeter, that is, a device for calculating fares. In my judgment, these PHVs are not equipped with a taximeter as defined by section 11(3). The driver’s Smartphone with the Driver’s App is not a device for calculating fares by itself or in conjunction with Server 2, and even if it were, the vehicle is not equipped with it. I reach that conclusion as a matter of the ordinary meaning of the words as applied to the agreed facts.’

‘The driver’s Smartphone was the primary candidate device for calculating fares. Server 2 receives inputs from the driver’s Smartphone, and elsewhere. The results of the calculation are transmitted to the driver and customer via their Uber APPs and to the third party which debits the customer’s account. But the Smartphone carries out no calculations; that is not its purpose. The calculation is carried out in fact by Server 2 and wherever it actually does it, it is not in the vehicle.’

‘LTDA and LPHCA argue that the driver’s Smartphone provides inputs to the calculation in the form of time and distance for the journey, which is correct. They argue that that suffices to make the Smartphone a device for calculating fares. Any involvement in the process of calculation was sufficient to constitute the Smartphone such a device. That is wrong.’

‘A device for recording time and distance is not a device for calculating a fare based on time and distance, let alone one based on more than that, including the fare structure itself, a necessary component to the calculation. The language of the statute is quite clear. The essence of a taximeter for the purpose of section 11 is that the device must be for the calculation of the fare then to be charged, based on whatever inputs are appropriate. Such a device is not simply recording and transmitting some or all of the inputs to a calculation made elsewhere, or receiving the output, that is the calculated fare. The Smartphone is not a “thing designed or adapted for a particular functional purpose” namely calculating fares for the PHV; see the Shorter OED. It is not a taximeter. The Smartphone with its Driver’s App may be essential to enabling the calculation to take place but that does not make it a device for calculating fares. Nor does that warrant treating the Smartphone as part of a single device with Server 2; it simply is not.’

‘Accordingly…I make the declaration below, and no order as to costs. A taximeter, for the purposes of Section 11 of the Private Hire Vehicles (London) Act 1998, does not include a device that receives GPS signals in the course of a journey, and forwards GPS data to a server located outside of the vehicle, which server calculates a fare that is partially or wholly determined by reference to distance travelled and time taken, and sends the fare information back to the device.’

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