Ref. Parkingeye Limited v Barry Beavis (2015)
In the above referenced case, Parkingeye managed the car park at the Riverside Retail Park, Chelmsford. Shoppers are permitted two hours of free parking and the penalty for overstaying is a substantial £85 parking fine, reduced to £50 if paid promptly.
The situation is a familiar one – Mr Beavis parked for nearly three hours and was charged the penalty. Like most of us when faced with such a parking fine, he grumbled – but in this case he decided to take the matter further, all the way to the County Court and, thereafter, the Court of Appeal.
The case turned on whether the charge constituted a ‘penalty’ and was therefore unenforceable, and whether it was ‘unfair’ under the Unfair Terms in Consumer Contract Regulations 1999.
It was found that Parkingeye’s business operated around the profit made from the charges recovered from parkers who overstayed.
The law states that a payment is likely to be invalid as a ‘penalty’ if it is intended to act as a deterrent and does not reflect any loss suffered through breach of contract. A penalty of this type is unenforceable in typical customer to business transactions, where the consumer typically enjoys a significant level of legal protection.
Parkingeye made the argument that parking was a unique case. The law needed to be more flexible, as unlawful parking should be deterred – so long as the level of the charge remains fair and reasonable.
The Court of Appeal held that, contrary to the Regulations, the charge here was a deterrent but was fair and reasonable in the circumstances. It would be wholly uneconomic for Parkingeye to enforce payment if it was substantially less, and it was clearly in the wider interest to enforce the recoverability of parking charges to avoid customer abuse of the facilities.
The 1999 Regulations require contractual terms of this type to meet the requirements of good faith and not to cause a significant imbalance in the rights of the consumer against the service provider. Parkingeye had clearly displayed the terms of parking on numerous signs across the parking area. The fee was not disproportionate, nor was it unreasonable as against other parking charges in the area. That being the case, the charge was fair and reasonable and Mr Beavis’ case was rejected.
Overstaying in a car park and being charged for just a few minutes extra may seem like an injustice – we’ve all been there – but, in the eyes of the law, it is legitimate.