Queensland Taxi Licence Holders v State of Queensland

This case concerned an appeal by holders of taxi services licences against summary judgment given on their claim against the State of Queensland. The claim arose out of amendments made to the Transport Operations (Passenger Transport) Act 1994, which permitted “booked hire service” operators (such as Uber) to compete with taxis. It was alleged that the amendments gave rise to a breach of contract and an equitable estoppel. The Court of Appeal unanimously found that the primary judge had been correct to summarily dismiss the claim.

Sofronoff P and Fraser and Philippides JJA

11 December 2020

Background

The appellants are holders of taxi service licences issued under the Transport Operations (Passenger Transport) Act 1994 (“the Act”). [1]. They were aggrieved by amendments made to the Act, enabling certain “booked hire service” operators (such as Uber) to compete with taxi drivers without holding a taxi licence. [23]. They brought a claim against the State of Queensland seeking damages for breach of contract, equitable compensation based on estoppel, and damages under the Australian Consumer Law. [1].

At first instance the respondent was successful in obtaining summary judgment in relation to the claims for breach of contract and estoppel. [1]. The appellants appeal against that summary judgment. [1]. Sofronoff P gave the reasons of the Court, with which Fraser and Philippides JJA agreed. [40]–[41].

The claim based on contract

The appellants contended that the manner in which they obtained licences from the State gave rise to contracts between them and the State. [25]. In particular, contracts were said to be made in circumstances where various statements had been made by government Ministers, or in other publications of the State, which indicated that the taxi-licensing system would remain in place. [8]. A “significant fee” was paid for a licence in that context. [7]. It was alleged that the contract contained an implied term that a “licence holder would only need to compete … with other persons holding a taxi licence”. [19].

President Sofronoff considered that the facts alleged in the statement of claim were “incapable of giving rise to any such contract”. [35]. That included because the statements relied on were “statements of intended government policy” only and were “not capable of amounting to statements of contractual intent or having contractual significance” (citing, for example, Australian Woollen Mills Pty Ltd v The Commonwealth (1955) 93 CLR 546). [35]. Further, all of the obligations imposed on the appellants, and the corresponding obligations of the State, were “imposed by statute” (the Act), not by contract. [35]. Lastly, his Honour observed that one of the “ramifications of the appellants’ case” was that the alleged contracts impinged upon the “freedom of the legislature to enact laws to amend an existing statutory regime”. [35]. Those allegations were “constitutionally incomprehensible” and constituted a “powerful factor against inferring the existence of a contract between the parties”. [24], [35].

Accordingly, the appeal against summary dismissal of the claim based on contract was unsuccessful. [36].

The claim based on estoppel

The appellants contended that by reason of the statements referred to above, the State had made representations which included that “only licenced taxis would be permitted to carry passengers for reward by road”. [9]. It was alleged that the appellants had reasonably relied on these representations in making “significant expenditures”. [11]. It was argued that it would be unconscionable for the State to be permitted, without remedy, to depart from the alleged representations, such that the pleaded facts gave rise to an equitable promissory estoppel. [16].

President Sofronoff said that the primary judge’s exposition of the statutory regulation of taxis in Queensland showed that “as social conditions change over time, so too does legislation that affects taxis”. [37]. As the primary judge had concluded, reasonable persons would have known that “there could be changes to the law affecting their rights”. [37]. It would have been “irrational for licensees to think that their rights would never be altered as the public’s expectations in relation to transport services evolved over time”. [37].

Accordingly, the appeal against summary judgment of the claim based on estoppel was also unsuccessful. [37].

W Isdale