Mr Clarke collapsed while driving a 26-tonne vehicle in Glasgow’s city centre in December 2014, causing it to veer out of control and crash into pedestrians, killing six people and injuring more than a dozen others in a 19-second incident.
Lawyers for the council sued First Glasgow (No 1) Ltd at the Court of Session last year claiming it acted negligently by failing to provide its HR department with a reference for Mr Clarke.
The court heard they said the alleged failure to disclose information about Mr Clarke passing out at the wheel of a vehicle a few years earlier meant the firm breached a duty of care to the crash victims.
However, in a Court of Session judgment on Thursday, Lord Ericht threw the action out and said the council had failed to chase the bus company’s HR department about Mr Clarke’s reference.
He said the evidence showed a former manager of Mr Clarke’s at the bus company, called Frank McCann, told him that an HR employee named Darryl Turner was the person to contact for writing references.
But, despite Mr Clarke alerting his prospective employers about the need to contact Mr Turner for references, the court heard no-one from the council followed this up.
Lord Ericht wrote: “There was no evidence from… emails or any other source that anyone from the pursuer (Glasgow City Council) had acted on the information received from Mr Clarke that a reference would require to be requested from Mr Turner rather than Mr McCann, and emailed or otherwise contacted Mr Turner requesting a reference.”
He said: “I find that no reference was received from Mr Turner.”
Lord Ericht concluded the council’s case had failed after it was unable to provide evidence showing that the bus firm had acted negligently.
Earlier in the case, the court heard claims that First Glasgow failed to disclose information on Mr Clarke having previously lost consciousness at the wheel in 2010.
A few years later, in 2014, he fainted while driving a bin lorry which led to the deaths of Erin McQuade, 18, and her grandparents Jack Sweeney, 68, and Lorraine Sweeney, 69, from Dumbarton; Stephenie Tait, 29, and Jacqueline Morton, 51, both from Glasgow; and Gillian Ewing, 52, from Edinburgh.
The £6.5 million sought would have compensated the council for the money it paid to the relatives of those were killed in the collision.
Crown lawyers decided not to prosecute Clarke due to there being “insufficient evidence” to show he had broken the law.