The case of Wokingham Borough Council v Arshad, involves advice from a licensing officer regarding the suitability of a vehicle purchased by Mr Muhammad Sohaib Arshad but subsequently found unsuitable for licensing by the council.

The background to the case concerns the purchase a second-hand Ford Galaxy that a 'technical officer' confirmed would be suitable for licensing, saying: “... provided the vehicle has correct documentation, a Ford Galaxy would be an appropriate vehicle and I believe we have other ford galaxy's on the fleet.”

Mr Arshad  consequently purchased the vehicle and submitted his HCV application, which included an Individual Vehicle Approval certificate relating to the adaptations. That certificate indicates conformity with certain EU norms, but those do not include passenger headroom. The Council issued Mr Arshad with a new HCV on 16 February 2017.

The Council became aware almost immediately that the car might not comply with the policy, and Mr Arshad was asked to bring it in for inspection.

At an inspection on 27 February 2017 it transpired that there was inadequate headroom for a wheelchair user. Mr Arshad was informed that his HCV would be suspended as the vehicle was not fit for purpose. He was sent a suspension letter on 2 March 2017 which informed him of a right of appeal to a Council sub-committee.

Council sub-committee turned down the appeal. 

In the meantime, the Council set about drafting a revised policy which would make clear the size of wheelchair that vehicles must accommodate and the necessary dimensions of the interior of vehicles. It also decided not to issue any more suspensions.

The Board which heard the other six appeals identified shortcomings and a lack of clarity in the policy and decided that although the vehicles were non-compliant, drivers could retain their licences “until a change in legislation or policy”.

Mr Arshad complained to the council but the Council rejected Mr Arshad’s complaint on 18 December 2017.  A subsequent complaint to the Local Government Ombudsman was upheld.  LGO found that the Council was at fault because it had given him wrong advice. It rejected a complaint of discrimination on grounds of religion. It recommended a fresh appeal hearing and the payment of £500 compensation. 

County Court

Mr Arshad brought a claim in the County Court alleging that he had been treated unlawfully in various ways. The judge recounted that at a hearing before Deputy District Judge Lindsay on 7 January 2021, the causes of action were identified as:

1. Discrimination on the grounds of race or religion;
2. Negligence (in the provision of advice that the Ford Galaxy would be an appropriate vehicle);
3. Breach of duty (in the carrying out by the Council of their statutory duties relating to hackney carriage licensing)

Only the negligence claim succeeded. Moreover, only one significant head of claim succeeded, namely the claim for general damages for personal injury consisting of psychiatric illness. Claims for consequential financial loss failed because the losses and/or causation of them were not proved. The claim for aggravated and exemplary damages was not made out on the facts.

The judge assessed damages for pain, suffering and loss of amenity (“PSLA”) in the sum of £42,500 and also awarded £290 for prescription charges and sundry litigation expenses. It seems to me that the latter two items were, and could only be, parasitic on the successful personal injury claim.

Finally the judge ordered the Council to pay costs of £6,270.60 to Mr Arshad.

High Court Appeal

On 28 March 2022, Martin Spencer J gave permission for the Council’s appeal to advance on three grounds, namely that Judge Clarke was wrong, in law and fact, to find that:

1. there was a relationship between Mr Arshad and the Council giving rise to a duty to take care to avoid causing him psychiatric damage;
2. psychiatric damage (as distinct from mere upset or distress falling short of a diagnosable psychiatric condition) was a reasonably foreseeable consequence of the negligent advice being given; and
3. Mr Arshad’s psychiatric injury was caused by the giving of advice by the Council (rather than the events which followed the giving of that advice).

Before The Hon. Mr Justice Bourne, the council argued that the County Court judge was wrong to find that the Council, when giving Mr Arshad the advice that the Ford Galaxy was a suitable vehicle, owed him a duty to take care to avoid causing him psychiatric damage.

With reference to a number of cases [at paras 32-42] Bourne J concluded that:

"I therefore agree with the judge to the extent that it was fair, just and reasonable in these circumstances to impose a duty of care to avoid the economic loss which plainly would be a reasonably foreseeable consequence of the negligence."

He went on to consider the second grounds advanced by the council, namely that "Judge Clarke should have found that psychiatric illness, as opposed to mere anxiety, upset or distress, was not a reasonably foreseeable consequence of the negligent advice."

Regarding this, Bourne J said:

"I acknowledge both the difficulty which this question posed for the judge in the circumstances of the trial and, with great regret, the consequences of this appeal for Mr Arshad. However, it seems to me that whilst any serious setback may be capable of causing a degree of psychiatric harm to anyone, psychiatric injury in this case was not so reasonably foreseeable as to make it appropriate for a local authority, giving discretionary pre-application advice on a licensing matter, to owe a duty of care not to cause pure psychiatric harm."

The council therefore succeeded in these grounds for appeal, making three further ground academic.  The Council’s appeal is allowed and the previous costs order set aside.