Taxi companies seek court injunction over ride-hailing bylaw

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This article was published 15/12/2017 (2321 days ago), so information in it may no longer be current.

Winnipeg taxi drivers are suing the provincial government after the value of cab licenses has fallen 75 per cent due to ride-sharing services legislation.

The cab companies are seeking a court injunction to block the city’s new bylaw that will allow services like Uber and Lyft to open in Winnipeg.

They maintain the province “acted in bad faith” when it passed legislation affecting the taxi industry by saying it is not liable to compensate the industry for changes.

“The provincial legislation has resulted in a devaluation of licenses,” said Scott McFadyen, spokesman for the Winnipeg Taxi Coalition.

Cab licenses are traded amongst prospective drivers, not unlike how quota for milk takes on value and are traded among dairy farmers. That’s in large measure because both quota and cab licenses are capped in number. For example, there are 410 cab licenses, a government-set amount.

Therefore, licenses take on value. Demand for cabbie licenses was still high in April 2016 when anyone wanting to obtain a cab license would have to pay $350,000, said McFadyen. Such sales must be approved by the Taxicab Board.

However, that same license is now only worth about $80,000 based on supply, demand and projected revenue stream, said McFadyen.

“Even though the licenses are issued by government, (their values) are based on profitability,” he said. In some cases, people have paid more than $500,000 for a license, he said.

Gurmail Gill, owner of Unicity Taxi, and Harjinder Dhillon, owner of Duffy’s Taxi, are plaintiffs in the suit.

The statement of claim filed with the Court of Queen’s Bench also levels discrimination charges against the province. The plaintiffs claim the province violated the Charter of Rights and Freedoms by not respecting the rights of taxicab license holders.

That is, it suggests the government is unwilling to compensate cab drivers their losses from the legislation because they are new Canadians, and 90 per cent are Sikh.

“Would the Manitoba government treat farmers this way?” asked McFadyen.

“This is the livelihood of thousands of Winnipeggers. They are pursuing all options to protect their livelihood,” McFadyen said of the lawsuit.

On Wednesday, city council approved the Local Vehicle For Hire bylaw that overhauls the regulation of the taxi industry in a 10-6 vote. Services such as Uber and Lyft can start on March 1.

However, the taxi industry is still under provincial jurisdiction until then.

The province passed legislation in November, effective Mar. 1, to bring more competition to the industry by disbanding the Manitoba Taxicab Board and turning over regulation, at least within Winnipeg, to city hall.

Edmonton was the first city in Canada to authorize ride-sharing, in March 2016, followed by Calgary, Ottawa, Toronto, London, Ont., Hamilton, Waterloo, Ont., and dozens of other communities.