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England and Wales High Court (Chancery Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Maugham v Uber London Ltd  EWHC 391 (Ch) (25 February 2019)
Cite as:  EWHC 391 (Ch)
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BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)
Strand, London, WC2A 2LL
B e f o r e :
(sitting as a Deputy Judge of the High Court)
| JOLYON TOBY DENNIS MAUGHAM QC
|- and -
UBER LONDON LIMITED
Sam Grodzinski QC (instructed by Herbert Smith Freehills LLP) for the Defendant
Hearing date: 6 February 2019
Crown Copyright ©
Mr William Trower QC:
"There is an extremely clear public interest at stake in the resolution of this case. HMRC is not taking any action, in circumstances where there is real reason … to believe that the relevant relationships (and therefore the relevant supplies) have been mischaracterised, and where there is an incomplete explanation from HMRC of its position, and no right to disclosure of the full train of correspondence."
17.1 Uber BV v Aslam  EWCA Civ 2748 in which the Court of Appeal concluded (see para 95 of the judgment of Etherton MR and Bean LJ) that an Employment Tribunal was entitled to find that:
"it is not real to regard Uber as working "for" the drivers and that the only sensible interpretation is that the relationship is the other way round. Uber runs a transportation business. The drivers provide the skilled labour through which the organisation delivers its services and earns its profits"
17.2 Case c-434/15 Asociación Profesional Elite Taxi v Uber Systems Spain SL  QB 854 in which the ECJ concluded (see para 48 of the judgment) that in the context of:
"an intermediation service … the purpose of which is to connect, by means of a smartphone application and for remuneration, non-professional drivers using their own vehicle with persons who wish to make urban journeys, must be regarded as being inherently linked to a transport service and accordingly must be classified as "a service in the field of transport" within the meaning of article 58(1) FEU".
"To take that step would be point a finger at only a small part of the picture I have outlined above. The political ramifications of a finding by a court – which, as I have said, I believe to be likely – that Uber is making taxable supplies and the Government has failed to collect the consequential VAT would be substantial. My hope is that, as the litigation progresses, pressure will build on the Government to engage with the undoubted public concern around tax avoidance generally and Uber's specifically. I believe that this is a far more effective means to bring the issues I have outlined above into the public domain than a judicial investigation into whether HMRC's conduct falls below a (necessarily, given the entirely appropriate split of competencies between the judiciary and the executive) low standard."
24.1 A costs capping order under CPR 3.19. This rule applies to proceedings other than judicial review proceedings. Mr Maugham does not seek such relief on this application because he says that it would only apply to limit his exposure in relation to future costs and would have required the court to be satisfied that there is a substantial risk that costs will be disproportionately incurred (CPR 3.19(5)(b)).
24.2 A costs capping order regulated by sections 88 and 89 of the Criminal Justice and Courts Act 2015 ("2015 Act") and CPR 46.16 to 46.19. For these purposes a costs capping order is defined by section 88(2) of the 2015 Act as "an order limiting or removing the liability of a party to judicial review proceedings to pay another party's costs in connection with any stage of the proceedings". As the present proceedings are not judicial review proceedings, this jurisdiction and the limitations for which it provides do not apply.
24.3 A costs capping order in an Aarhus Convention claim within the meaning of CPR 45.41(2)(a), relief which is itself excluded from the 2015 Act regime (The Criminal Justice and Courts Act 2015 (Disapplication of Sections 88 and 89 Regulations) 2017 (SI 2017 No 100)). These are claims for judicial review in certain environmental matters in respect of which there is a free-standing statutory code which limits the recoverability of costs (see Section VII of CPR Part 45).
"I should start by explaining what I understand to be meant by a public interest challenge. The essential characteristics of a public law challenge are that it raises public law issues which are of general importance, where the applicant has no private interest in the outcome of the case. It is obvious that many, indeed most judicial review challenges, do not fall into the category of public interest challenges so defined. This is because, even if they do raise issues of general importance, they are cases in which the applicant is seeking to protect some private interest of his or her own."
"We would therefore restate the governing principles in these terms:
(1) A protective costs order may be made at any stage of the proceedings, on such conditions as the court thinks fit, provided that the court is satisfied that:(i) the issues raised are of general public importance; (ii) the public interest requires that those issues should be resolved; (iii) the applicant has no private interest in the outcome of the case; (iv) having regard to the financial resources of the applicant and the respondent(s) and to the amount of costs that are likely to be involved it is fair and just to make the order; and (v) if the order is not made the applicant will probably discontinue the proceedings and will be acting reasonably in so doing.
(2) If those acting for the applicant are doing so pro bono this will be likely to enhance the merits of the application for a PCO.
(3) It is for the court, in its discretion, to decide whether it is fair and just to make the order in the light of the considerations set out above."
"In my judgment, the court cannot make a PCO in this case. This is not public law litigation, but a private claim by a single employee against her employer. A PCO cannot be made in private litigation."
42.1 Wilkinson v Kitzinger  EWHC 835 (Fam) was a case in which, (per Lloyd LJ in Eweida at para 25), the President had treated the proceedings as "essentially "quasi-public" … essentially directed to the elucidation of public law … which might appropriately be brought in the Administrative Court but for the statutory provision contained in section 55 of the 1986 Act." Lloyd LJ also pointed out that the order in fact made was a cost capping order not a PCO.
42.2 Morgan and Baker v Hinton Organics (Wessex) Limited  2 P&CR 4 ("Morgan") was another case said to be governed by the Aarhus Convention in which no order was in fact made. Lloyd LJ said as follows (Eweida at para 29):"So far as I am aware there is no other example of private litigation in which the Corner House principles have been considered for possible application, let alone applied. Morgan v Hinton was private law litigation (a claim for an injunction based on nuisance) but the issue did not concern a PCO, and no such order had been applied for (except upon the hearing of the appeal which was far too late, even if it had otherwise been well-founded).
"We will monitor the two ongoing legal cases; depending on how they land, we will take further counsel's opinion and we will test it again. You talked about one taxpayer, but there is a vast array of these intermediary organisations. I am being transparent with you: we have tried six times in the last three years to prove that they are the principals and we have lost."
"Accordingly, we would accept that the mere fact that the claimant has a personal interest in the litigation does not of itself bar her from obtaining a PCO."
"where the public is funding both sides of the review in the sense that crowdfunding feeds the claim and taxpayers' money funds the defence, it is entirely appropriate for a judicial review costs capping order to be made at appropriate level which will not artificially limit either side's efforts and expenditure, but which will enable this claim to be heard."