Retail centre owners and their entrepreneurial co-contractors have over the last few years been busy perfecting a method for car-driving customers to find a way to be able to park for free without encouraging the self-same car owners to stay in their parking spot for too long and make it difficult for other shoppers to park.
The typical contractual arrangements are that the owner of the retail centre enters into a contract with the car park management contractors under which they receive regular fixed income and the management company has the right to keep the penalty charges paid by customers who over-stay in the car park. The right to park for free is usually limited to a time period of between 2 and 3 hours. The customers who comply with the parking rules do not have to pay a penny for parking. The management company depends upon a certain number of people breaching the parking rules otherwise it loses money and this gamble on there being a critical mass of customers who will not leave by the required time appears to provide a viable income for the management company.
However, in the recent Court of Appeal case of Parkingeye Limited v Beavis ([2015] EWCA Civ 402) Mr Beavis asked the Court to find that (1) the £85 overstaying charge was unenforceable at common law because it was a penalty; and (2) such charge was unfair and therefore unenforceable by virtue of the Unfair Terms in Consumer Contracts Regulations 1999. If Mr Beavis had succeeded with his appeal there would have been serious repercussions for the car park management world as this model for funding "free" car parking is widespread in retail centres across the land. Ultimately, however, the Court was happy that even though the retail centre owner had not suffered any loss by the overstaying in question, the charge applied to Mr Beavis for overstaying though it was a penalty, was not unenforceable. The charge broadly reflected the same kind of parking penalties payable by car owners who breached local authority parking regulations, and the charges were clearly communicated to Mr Beavis when he parked his car.
These kind of car park management arrangements benefit all concerned:
- the contractors themselves (who get to keep the payments);
- the customers who leave before the free period expires (who get the benefit of the use of a car park with more parking spaces available);
- the tenants of the shop units (who can expect to have a greater footfall of customers because more people use the car park); and
- the retail park owners (who gets paid a regular fixed amount by the car park management contractors) and who also hope to be able to obtain higher rents in the long term if more customers come to the retail park.
While the terms of the ruling do not provide a blanket approval of all such overstayer parking charge schemes they do suggest that they are likely to be legal providing that (1) the charges in question are broadly comparable to those charged by local authorities in respect their parking facilities; and (2) the terms on which parking is permitted and charges will be made are clearly communicated.
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