Denley: It’s about time city council deal with harm done to taxi industry

A judge ruled in favour of Ottawa taxi drivers in their class action lawsuit against the City of Ottawa over how the city “abandoned” them when Uber arrived in 2014. Photo by Tony Caldwell /PostmediaArticle content

Just over a year has passed since Ontario Superior Court Justice Marc Smith ruled that Ottawa was negligent in its failure to enforce the city’s taxi bylaw when Uber began operating here in 2014, an inaction that damaged the taxi industry. Taxi plate holders and taxi brokers are seeking $215 million in compensation.

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One might have thought that the court loss and the magnitude of the potential compensation would have galvanized the city into action, but it has not. There is little sign that city councillors are engaged with the issue or even know what’s going on.

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The whole thing is cloaked in secrecy. A request to city legal staff to provide basic information received a blanket denial on the grounds that the matter is before the courts. Even a question about whether councillors are receiving updates from legal staff received the legal equivalent of a middle-finger salute.

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The court decision last year was the culmination of decades of council mismanagement of the taxi industry. The key error was limiting taxi plates to the number city bureaucrats thought would be appropriate. That created an unofficial market in taxi plates with people paying up to $300,000 for the right to operate a cab. Then Uber came along and the city let it operate outside existing taxi rules. The taxi industry took a huge hit and the value of taxi plates plummeted.

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This city council didn’t cause the problem, but it has the responsibility of fixing it, a responsibility it is so far shirking.

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The city’s legal strategy has all the hallmarks of foot-dragging. Last summer, the taxi industry suggested a small surcharge on taxi and rideshare company fares as a way to cover the cost of a settlement. The city still has not responded.

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Last week, both sides participated in a case conference on a key issue. Should taxi plate owners be compensated individually or as a group? Lawyers for the plate owners want group compensation.

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City lawyers have a different point of view. They dispute the idea that plates have declined in value and say there should be a separate decision for each of the 768 plate holders. Despite the city’s secrecy, its written argument is available on the opposing counsel’s website.

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Justice Smith is expected to make a decision soon on how to proceed, but the city’s hired legal team doesn’t have availability until next spring. Meanwhile, aging plate owners who were counting on compensation to allow them to retire have nothing but legal bills.