Council ordered to pay costs of ‘improper’ prosecution of Lucky Seven Private Hire

A local authority has been ordered to pay costs to a private hire operator after it admitted that its own mistake led to a discontinued a two-year long prosecution against the operator.

Newcastle-under-Lyme Borough Council had prosecuted midlands operator Lucky Seven Private Hire for illegally operating in its area after it failed to issue the operator with the correct license when the business changed hands. But before the matter came to court, the council was forced to admit that it could not even prove that Lucky Seven had been “operating” within its area. 

Lucky Seven holds operator’s licenses in Stoke-on-Trent, Wolverhampton, Cheshire East and Newcastle-under-Lyme. In late 2021, ownership of the business changed hands after the death of one of the co-owners, Tahir Mahmood. The company applied to each of its authorities for a new operator’s license and completed the necessary suitability checks. Each authority granted a new operator’s license in the names of the new business owners.

However, Newcastle-under-Lyme Borough Council purported to “transfer” the existing license to the new owners, retaining the old license’s original expiry date of April 2022 – an effective license term of just six months.

The owners did not notice that they had not been granted a new five-year license until the afternoon of the expiry date.

In response, they hastily made arrangements to ensure their business could continue to operate lawfully, through allocating bookings to licensed hackney carriages (for which no operator’s license is required) or by sub-contracting bookings through their Stoke entity to other Lucky Seven entities or a separate Newcastle-licensed operator.

At all times, the business had operated from a single premises – the address of which was specified in their Newcastle operator’s license – in the administrative area of Stoke-on-Trent. 

Newcastle-under-Lyme Borough Council took the view that this arrangement was unlawful and amounted to operating without an operator’s license. A prosecution was commenced in October 2022. 

But Lucky Seven had not “made provision for the invitation and acceptance of bookings for a private hire vehicle” in Newcastle’s area (as it had been doing so in Stoke), so it had not been “operating” in its controlled district and therefore the offence was not made out.

The Council had unlawfully granted him an operator’s license of just six months’ duration.  Had the company been granted the 5-year term to which it was entitled (in the absence of any exceptional circumstances justifying a shorter term), it would have held a valid operator’s license throughout the period subject of the prosecution. This meant the prosecution was brought as a direct result of the Council’s own unlawful act.

The prosecution was adjourned three times due to lack of court time. At no point did the Council formally respond to the two issues of law raised by the defendant. 

The trial was listed for a fourth time on February 17, 2025 at Cannock Magistrates’ Court. On the morning of the trial, the Council belatedly conceded that it could not prove its case that the defendant had been operating in its own district.

In offering no evidence, the Council also cited problems with witnesses, most notably a former Lucky Seven driver who had provided a witness statement in support of the prosecution but who – a few days before one of the abandoned trial dates – had sent two voice notes to the defendant explicitly offering to change his evidence “if you pay to me some good money”. The District Judge described this behaviour as “offensive in the extreme”. 

The court granted the defendant’s application under section 19 of the Prosecution of Offences Act 1985 for an award of costs against the Council (as opposed to the standard order of costs from central funds).  The Council did not resist the application and agreed the amount that should be paid. A section 19 order is reserved for cases where one party to a prosecution has incurred costs “as a result of an unnecessary or improper act or omission” by another party to the proceedings.

Matt Lewin, a member of Cornerstone Barristers’ Licensing Team, was instructed by Lucky Seven through direct access.