A test legal challenge has been launched against the sellers of a series of faulty black cabs that have caused havoc across the UK’s taxi industry.

Edinburgh legal firm Warners has mounted the compensation case on behalf of taxi driver David Gillan, who is looking to win substantial damages since his cab burst into flames earlier this year.

Mr Gillan is one of hundreds of taxi drivers across the UK to have lost earnings as a result of purchasing the cabs, which have been branded unsafe by taxi watchdogs following a string of under-bonnet fires in Edinburgh and London.

In August, the Public Carriage Office in London recalled around 500 cabs from service after seven fires broke out within the space of three months.

In Edinburgh, more than 40 of the taxis were suspended from service earlier this year following a series of similar incidents, including the fire in Mr Gillan’s cab.

The 45-year-old is now seeking compensation against Black Horse Finance – the finance company that sold him the taxi – and says he has lost thousands of pounds since he bought the cab, even before it caught fire on Frogston Road West, Edinburgh in February.

And if he wins his case at Edinburgh Sheriff Court next March, it is expected that it could open the floodgates to other compensation claims.

Mr Gillan, who owns his taxi with his brother Robert, said that he had to pay for repairs on the faulty vehicle from his own insurance policy after the engine fire and lost earnings while it was out of service being fixed.

He added that he and his brother had also lost substantial earnings when cab officials in Edinburgh decided to take all of the faulty taxis off the road for safety reasons.

He said: “This is our only source of income, so to have the cab off the road for months has meant that we have lost a lot of money. Ever since we bought the vehicle, it has been problem after problem and we’ve just had enough.

“In the last year and a half we’ve had to deal with seven burst radiators, a ruptured thermostat, the inner wing collapsing, as well as three fuel leaks.

“The final fuel leak even led to a fire under the bonnet, and we were very lucky that we were able to put it out. I know one other cabbie with the same make of taxi as us and his vehicle was completely destroyed after the engine caught fire.

“But despite all these problems, no-one has taken responsibility for them. The finance company don’t want to know, as they say it’s not their fault, and the manufacturers LTI are doing exactly the same. They’re not even accepting that there is a fault with the cabs in the first place.

“As far as I’m concerned, these taxis are faulty and dangerous and should never have been allowed on the road. A lot of taxi drivers like us are furious that they have lost huge sums of money by purchasing these cabs. Taxi Chesterfield seems to have escaped it.

“I am determined to get the compensation that I’m due for loss of earnings, as well as for the expense of buying the vehicle in the first place.”

The engine problems have only affected LTI-manufactured TX4-type cabs with a 56 registration. In September, a total of 44 of the taxis were taken off the streets in Edinburgh and were issued with notices branding them “unfit for purpose”.

The Edinburgh Taxi Operators Association has said that, although it is not taking an active role in helping drivers affected by the faulty vehicles to claim compensation, it is aware of the upcoming court action and will be monitoring the result.

David Wilson, Legal Partner with Warners solicitors, said: “There is clearly a fault with these taxis but none of the finance companies or garages that sold them, or even the manufacturers themselves, have taken responsibility for the technical problems that have affected the vehicles. They haven’t even admitted there are problems with the vehicles in the first place.

“We are also representing a number of other taxi drivers in compensation cases over loss of earnings caused by these taxis, which will be taking place over the coming months.”