England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE TRANSPORT TRIBUNAL

		Royal Courts of Justice Strand, London, WC2A 2LL Friday 23 February 2001

LORD JUSTICE SIMON BROWN:

Introduction

1. This appeal concerns timetabled bus services and their operators. Those of us who travel by public transport need these services but we need them to be reliable. The Transport Act 1985 (the Act) brought in a new approach to the problem. Its policy was to deregulate the initial provision of bus services but then exercise some control over them once in operation. By s.6 of the Act any operator holding a public service vehicle (PSV) operator's licence may register as a local service any route he chooses to whatever timetable he chooses. A registered service is subject to no scrutiny prior to its operation. Once registered, however, any services are subject to the controls provided for by ss.26 and 111 of the Act. When invoked, s.26 allows a condition to be attached to the PSV licence prohibiting the provision of services; s.111 provides for a determination which results in the operator forfeiting 20% of his entire fuel duty rebate for the previous three months.
2. These controls are exercised by a Traffic Commissioner against whose decisions the operator can appeal whether on fact or law to the Transport Tribunal. A further appeal lies directly to this Court but only in point of law. The present is the first such appeal ever brought.
3. It is brought against the decision of the Transport Tribunal (presided over by Mr Hugh Carlisle QC) on 11 December 1999 dismissing the appellant operator's appeal from the decision of the Deputy Traffic Commissioner for the North West Traffic Area whereby he exercised his powers against the appellants under both ss.26 and 111. The condition he attached to the appellants' PSV licence under s.26 was one prohibiting them from using its vehicles to provide any local services beyond those currently registered. The effect of his determination under s.111 was to require the appellants to repay fuel duty rebate amounting to some £120,000.
4. The appeal raises a number of difficult questions as to how traffic commissioners should understand and apply their powers under these two sections. It is perhaps some indication of the importance attached to it that both sides have agreed to bear their own costs whatever its outcome.
5. Before identifying the particular points at issue or even setting out the relevant statutory provisions it is convenient first to summarise the main facts of the case.

The Facts

6. The appellants hold a standard international PSV operator's licence and operate numerous registered bus services in the North West. Over a five day period (Monday to Friday) in February 1999, 1,283 journeys forming part of 26 of the appellants' registered services were monitored as part of a major bus monitoring exercise undertaken by the Bus Registration Compliance Unit of the North West traffic area. Of those 1283 journeys monitored, 164 were found not in accordance with the registered timetable: 26 did not run at all; 138 were 6 minutes or more late. Overall, during that five day period, the appellants had operated 23,255 journeys. Those monitored, therefore, represented some 6% of the total.
7. Several other operators' services were similarly monitored during this exercise. In the result the appellants, together with a number (but not all) of the others, were asked to attend a series of public inquiries convened to consider whether the traffic commissioner's statutory powers should be exercised against them. A total of sixteen inquiries were held on nine separate days over a five week period in June - July 1999 (the appellants' inquiry being the last), twelve concerned with the monitoring exercise, the other four with a parallel Office of Fair Trading investigation. During the course of these hearings the Traffic Commissioner heard from the managers of nearly twenty bus companies, large and small, the hearings constituting "the biggest and most in-depth examination of [a "range of legal and practical problems" thrown up by these cases] in the history of the Traffic Commissioners". Whilst giving each operator individual consideration, the Commissioner in almost all cases deferred his decision until the conclusion of the hearings, partly so that during them he could "take advantage of the unique chance these inquiries have given me to pick brains, listen and learn", and partly so as "to deal with the cases consistently".
8. On 15 July 1999 the Commissioner gave a written decision in three parts: Section 1 by way of a "General Introduction to Decisions," including a description of the course of the hearings which I have just summarised; Section 2 setting out "the Law Relating to the Bus Monitoring Exercise"; and Section 3 stating the Commissioner's "Findings and Conclusions" with regard to these appellants.

The relevant legislation

9. Under s.6(2) of the Act "... no service shall be provided in any traffic area in which there is a stopping place for the service unless (a) the prescribed particulars of the service have been registered with the traffic commissioner for that area by the operator of the service; (b) the period of notice in relation to the registration has expired; and (c) the service is operated in accordance with the registered particulars".
10. By the Schedule to the Public Service Vehicles (Registration of Local Services) Regulations 1986, the particulars of the service required to be registered include "a timetable for the service, indicating the days in the year when the service will be provided and the proposed times of individual services at principal points on the route, save when the service interval is ten minutes or less when a statement of that fact may be given".
11. A commissioner must accept the registration of a service if the operator running it has an unconditional PSV licence and gives forty-two days notice of his intention to operate the service.
12. Section 26 provides:

"(1) Where it appears to a traffic commissioner, in relation to a person ('the operator') to whom he has granted or is proposing to grant a PSV operator's licence, that -

(a) the operator has failed to operate a local service registered under s.6 of this Act; or

(b) the operator has operated a local service in contravention of that section; or

...

he may (on granting the licence or at any later time) attach to it either a condition prohibiting the operator from using vehicles under the licence to provide any local service of a description specified in the condition or one prohibiting him from so using vehicles to provide local services of any description.

(2) The commissioner may attach a condition to a PSV operator's licence under sub-section (1) above, by reference to circumstances falling within paragraph (a) or (b) of that sub-section if, but only if, it appears to him that the operator did not have a reasonable excuse for his conduct or that it is appropriate to attach the condition in view of -

(a) the danger to the public involved in the operator's conduct; or

(b) the frequency of conduct of the kind in question on the part of the operator."

13. I need not read the other subsections.
14. Section 111 provides:

(1) Where the traffic commissioner for any traffic area is satisfied that the operator of a local service has, without reasonable excuse -

(a) failed to operate a local service registered under s.6 of this Act; or

(b) to a significant extent operated a local service in contravention of that section;

he may make a determination to that effect.

...

(3) Where a determination has been made under subsection (1) above with respect to a local service there shall become due to the Secretary of State from the operator of the service an amount equal to 20% of any amount paid to him [in respect of fuel duty rebate] in respect of all services operated during the period of three months ending with the day on which the traffic commissioner made his determination."

15. Again I need not read the other subsections.
16. As the Traffic Commissioner noted in Section 2 of his decision, all the cases before him had fallen for consideration under s.26(1)(b) and s.111(1)(b) of the Act, concerning as they did the operation of local services "in contravention of s.6," namely "[not] in accordance with the registered particulars", because not in accordance with the registered timetable for the service. Sections 26(1)(a) and 111(1)(a) are designed primarily for cases where the operator, having registered a service and published its timetable, then simply fails to bring it into operation or thereafter ceases its operation.
17. The basic effect of s.26 in a case like the present is, of course, plain: the Commissioner can attach a condition to an operator's PSV licence if he concludes that (1) on any local service the operator has not kept to his registered timetable, and (2) either (a) the operator had no reasonable excuse for that conduct, or (b) a condition is appropriate in view of the danger to the public involved in that conduct (clearly not applicable where, as here, the conduct consists of a failure to operate a service in accordance with the registered timetable), or (c) a condition is appropriate in view of the frequency of that conduct.
18. The basic effect of s.111 is similarly clear. In a case like the present the Commissioner can impose the stipulated penalty where he is satisfied that the operator (1) has to a significant extent failed to keep to the registered timetable, and (2) had no reasonable excuse for that failure. Where applied, s.111 operates as a blunt instrument. The Commissioner has no discretion to reduce the extent of the penalty.

The Traffic Commissioner's decision

19. The first main difficulty for the Commissioner was how to apply the provision in ss.26 and 111 with regard to "reasonable excuse". In Section 2 of his decision he dealt with it as follows:

"Operators, naturally, want to claim 'reasonable excuse' - a term, many of them say, encompassing traffic congestion, bus breakdowns, more passengers than expected getting on or off, calls of nature, staff absenteeism, roadworks and any number of scenarios which, looked at on a micro individual level, are not directly under the control of the operator.

But is a public inquiry supposed to go through each and every one of these hundreds of observations and hear and assess evidence and submissions about each one? How can a traffic commissioner know if the excuse is true? Was the traffic congestion a predictable or regular occurrence? Why did the bus break down? What reserve staff and/or vehicles are available? What contingency plans are there? What notice did the operator have of the problem? Could the difficulty have been avoided with better planning or the spending of money? Did the driver have a chance to go to the toilet before he set off? Regrettably, public inquiries along these lines would take weeks, if not months. It is just not practicable to proceed in that way."

20. In the result the Commissioner concluded that:

"... in a massive case such as this, ordinary everyday occurrences like traffic congestion, mechanical failure and so on can be taken as part and parcel of running a bus service, for which allowance is made in a window of tolerance, and permitting a realistic failure rate. This, then, allows a proper examination of, hopefully, a very small number of genuinely extraordinary occurrences ... "

21. Amongst the "genuinely extraordinary occurrences" in the various cases before him the Commissioner accepted "discovery of hyperdermic needles on a bus, road blocked unlawfully and police informed, passenger taken ill, driver's wife rushed to hospital, snowfall, the need to wait for school children, a serious road traffic accident, and difficulty with a disabled passenger who needed help from the driver."
22. So far as s.26 was concerned, the Commissioner recognised that the problem was scarcely a real one:

"... there can come a point where the frequency of failure is such that there is no longer a requirement to consider a succession of excuses because the frequency of failure itself is unacceptable, and beyond redemption by run-of-the-mill excuses. A macro or broad view can be taken."

23. In other words, the Commissioner can act under S.26(2)(b) on the basis that a condition is appropriate in view of the frequency of the failures.
24. Turning to s.111, he said this:

"If the operator offers hundreds of individual excuses such as traffic congestion, bus breakdown, driver absenteeism, a driver had to take a natural break, passengers had to get on, passengers had to get off, roadworks, traffic lights and so on the commissioner must ultimately be able to say, in effect, that such excuses cut little ice when failure is persistent, other similar operators generally manage to get their buses to keep to timetable, and the public are fed up of the operator's buses turning up late, early or not at all.

I believe the correct interpretation of s.111 is to hold that the greater the extent or frequency of failure, the less there is to be gained by trawling through hundreds of supposed excuses of a routine nature although, of course, genuinely extraordinary occurences will still need to be excluded. In my judgment, the more significant the failure to achieve an acceptable level of compliance within accepted windows of tolerance, the more onerous the operator's task of establishing an excuse across the board, and the less likely - taking a broad view- that the excuse will be found to be reasonable."

25. As to the "window of tolerance" the Commissioner followed the example of the Senior Traffic Commissioner in an earlier case in allowing a tolerance of five minutes either way from the registered timetable and noted:

"Since we don't deal in parts of a minute, this gives a window of tolerance of nearly twelve minutes, a remarkably generous time span around a timetable time - counting as a failure only those early and late runners which are early or late by six minutes or more."

26. As to what should be permitted by way of "a realistic failure rate" the Commissioner said this:

"Having heard from a number of very senior and experienced executives from the industry, and in the absence of persuasive research as to what level of adherence to timetable it is reasonable to expect a City Centre operator to achieve, I think it not unfair to expect operators to achieve at least 96% of journeys no more than five minutes either side of the actual current timetable - i.e. within the twelve minute window of tolerance - with a very real possibility of action under ss.26 and/or 111 if the proportion of monitored failures from an appropriate sample (excluding genuinely extraordinary occurrences) falls significantly below this not unrealistic level.

...

The Senior Traffic Commissioner has said that passengers have the right to expect their bus to arrive at, or very close to, the stated time. Otherwise, of course, there is little prospect of getting people out of their cars and back onto public transport - a goal which, presumably, operators share."

27. When, under Section 3 of his decision, the Commissioner then came to apply his general conclusions to the appellants' case he set out the results of the monitoring exercise which I have already summarised and continued:

"The operator, however, claims 'reasonable excuse' in about 100 of the [164] cases where the [appellants'] Stagecoach bus failed to appear either within the window of tolerance of nearly 12 minutes around the registered timetable time, or at all.

The reasons for not running at all were traffic delay build-ups, traffic delay, staff failure, ticket machine failure, vehicle breakdown, driver failure or malpractice, and administrative error and staff failure. For the reasons given above, I do not accept these as amounting to a reasonable excuse. Allowance is made for these ordinary everyday occurrences by being realistic, and not expecting a 100% success (although, as I have learned, many operators with difficult inner city services still feel that 95% or 96% is achievable - depending on the window of tolerance allowed).

The reasons for the excessively late departures were roadworks, vehicle defects, unspecified passenger difficulties, lots of passengers getting on, claimed 'abnormal' traffic congestion (occurring one day after the next and apparently affecting numerous local services), driver requiring a natural break, and Wednesday is Market Day in Blackburn.

The operator produced press cuttings referring to local residents on one road [on route X25] seeking compensation for the months of roadworks they have had to suffer. In my view, this is no excuse for buses being persistently and significantly late for passengers, many of whom are elderly, or have important appointments, and who arrive at the bus stop in all weathers expecting the bus to show up more or less in accordance with the timetable. Operators must accommodate such real-life everyday problems.

I discount one failure due to difficulties with schoolchildren, but I do not regard the rest as amounting to a reasonable excuse, and I do not consider that the operator has a reasonable excuse for performing so badly during this extensive monitoring exercise. Allowance is made for the very ordinary everyday occurrences claimed as reasonable excuses in the general window of tolerance of nearly 12 minutes, and in not expecting 100% compliance. These occurrences are part and parcel of the business.

Following evidence on behalf of the operator I am satisfied that, allowing for a window of tolerance of nearly 12 minutes, the failure rate in this case is around 12.5%. That is about one bus in every eight either failed to turn up or turned up 6 or more minutes late. This is significantly below the one in twenty laid down by the Senior Traffic Commissioner, a failure for which this large operator has no reasonable excuse.

...

I find, therefore, that this operator has, to a significant extent and without reasonable excuse operated a local service in contravention of section 6 Transport Act 1985, and, so far as section 26 is concerned, I find that the frequency of the conduct on the part of the operator makes action appropriate. A line has to be drawn somewhere."

28. The Commissioner then concluded that a Section 111 determination was justified:

"Such a repayment [£120,000] would not be disproportionate to the level of failure shown, nor to the inevitable inconvenience and difficulty caused to the public by their buses being so unreliable. I realise this is not a course to take lightly. In these 16 public inquiries I am only making two section 111 determinations, but of the large operators with over 1,000 services monitored, this intolerable level of failure is the worst."

29. As to the section 26 condition he was attaching, the Commissioner said that he was requesting another monitoring exercise in about nine months and:

"If all is well, the operator may consider making application for the condition to be lifted. But there will be no new registration of routes until the operator's performance has demonstrably improved."

The Transport Tribunal decision

30. Four points only appear to have been argued before the Transport Tribunal of which only the third, as to "reasonable excuse", remains relevant to the arguments advanced on the present appeal. The Tribunal said this:

"The company's third point was that the Deputy Traffic Commissioner had misdirected himself in his approach to the issue of reasonable excuse and that he was required to consider each journey separately. We think that this depends on the nature of the excuses themselves. If they were exceptional then individual consideration was required. If on the other hand they fell into categories then consideration of the generality was sufficient. Having read the decision and the evidence we are satisfied that the Deputy Traffic Commissioner approached this aspect of the case correctly. We expressly endorse his comments that a distinction must be drawn between 'ordinary everyday occurrences' and 'genuinely extraordinary occurrences'. He was entitled to reject 'reasons for not running at all (such as) traffic delayed build-ups, traffic delay, staff failure, ticket machine failure, vehicle breakdown, driver failure or malpractice, and administrative error and staff failure'. Reasons for excessively late departure such as 'road works, vehicle defects, unspecified passenger difficulties, lots of passengers getting on, claimed 'abnormal' traffic congestion' were also properly rejected. All such matters are questions of fact and degree and were properly considered by the Deputy Traffic Commissioner."

The main grounds of appeal

31. The central criticisms of the Commissioner's approach now made by the appellants I understand to be as follows. First, that the Commissioner considered the operator's compliance or failure rates by reference rather to bus journeys than to bus services (i.e. bus routes). Second, that the Commissioner wrongly ignored a whole category of reasonable excuses, namely those he characterised as "ordinary everyday occurrences". He should, submit the appellants, have examined each excuse individually. Third, that the burden of proof should not have been placed on the operator to prove reasonable excuse. Fourth, that the benchmark of a 95% success rate required for compliance with the timetable (within the 12 minute window of tolerance) was arbitrary and unfair and fixed by reference to evidence given in other inquiries which should have been disregarded in the appellants' case. Fifth, that in any event the monitored failures should have been compared not with the total number of journeys (or services) monitored but rather with the entirety of the operator's services, monitored or not.
32. Let me consider these grounds in turn.

Journeys or services

33. The Commissioner should, submits Mr King QC for the appellants, have looked not at individual journeys but instead at particular services. I confess to having found this argument difficult to follow. True it is that both ss.26 and 111 refer to the operation of "a local service" in contravention of the requirement to run to the registered timetable. But obviously every service is made up of individual journeys between the various designated points on the route (including the beginning and end of the route which were the specific points monitored in the instant case), and it must be recognised that s.26(1)(b) is engaged as soon as there is a single departure from the timetable. Both the appellants and the Commissioner knew perfectly well to which particular services the individually monitored journeys related and in which services, therefore, the failures had occurred. If the appellants wished to contend (as to a limited extent they did) that the journeys monitored were not truly representative of the services monitored, or indeed that the services monitored were not truly representative of the totality of services which they operated, they were well able to do so. The mere fact that the Commissioner chose to assess the appellants' performance globally rather than by reference to specific individual services seems to me neither here nor there.
34. Of course it was necessary, to justify such an approach, for the Commissioner to be satisfied that the sample of journeys monitored was sufficient and representative of the appellants' operation as a whole. Plainly, however, he was so satisfied. I have already quoted his conclusion that:

"This sample was big enough, in my view, to exclude any serious likelihood that the picture of unacceptably poor service to the public, discovered on monitoring 1,374 journeys, was not representative, or typical."

35. That, in my judgment, was quintessentially a question of fact and degree for the Commissioner, to be determined, naturally, in the light of any evidence the appellants chose to put before him. The appellants, it is right to say, focused particular attention on route X25 to which 22 of the late journeys related. These, they contended, resulted from unpredictably prolonged road works and were in truth unavoidable. That argument, however, the Commissioner clearly rejected on the facts. Whether or not he was right to have done so cannot found an appeal in point of law.
36. The same response falls to be made to a number of other such criticisms of this monitoring exercise: its restriction to weekdays only and not weekends, its focus on parts only of the routes monitored (notably the beginning and end) rather than their entirety; its failure (suggests Mr King, although I am unclear on what basis) to survey "good days and bad days".
37. It may be that the appellants could have led evidence to invalidate the survey as a sufficient and representative sample of the appellants' services. We were indeed shown a report that might have provided such evidence - Colin Buchanan & Partners' November 2000 report for the Confederation of Passenger Transport entitled "The Factors Affecting Bus Reliability". This, by reference to Bristol, one of five cities whose problems were considered in depth, concluded:

"... if you make observations limited to particular points and directions on a bus service you may get a reliability measure that is quite different from the true value of the whole service. The second point is that a service with departures (this is at the beginning of the route) which are far more reliable than are demanded by the Commissioner's standards [95% within the permitted window] may still have an overall reliability performance which falls far short of those standards. ... A further conclusion that you can draw ... is that if you have only a limited number of observations ... you can have little confidence in the estimate of the true reliability of the whole service. That is for all bus stops, both directions, all times of the day and week. So this is the sampling problem again."

38. That report, however, lay in the future and, as we ruled at the outset of the hearing, could not be used to impugn the Commissioner's and Transport Tribunal's decisions under challenge in the present appeal.

Reasonable Excuse

39. It is not, of course, correct to say that the Commissioner "ignored" those excuses he categorised as "ordinary everyday occurrences". True, in one of the passages already quoted from his decision, he says, having listed a number of such excuses, "I do not accept these as amounting to a reasonable excuse". He immediately adds, however, "allowance is made for these ordinary everyday occurrences by being realistic and not expecting a 100% success ... " and, a little later, "allowance is made for the very ordinary everyday occurences claimed as reasonable excuses in the general window of tolerance of nearly 12 minutes, and in not expecting 100% compliance. These occurrences are part and parcel of the business."
40. Mr King challenges the legality of that approach and contends that the Commissioner has no alternative but to consider each and every excuse put forward by the operator as a reasonable justification for the various failures to meet the timetable. I disagree. The Transport Tribunal was in my judgment right to reject this ground of appeal and to endorse the Commissioner's approach of distinguishing between everyday occurrences on the one hand and extraordinary ones on the other. But it is important to recognise on what basis this approach is supportable. It is supportable not because these everyday occurrences, taken singly, are necessarily incapable of constituting a reasonable excuse for any given timetable failure but rather because, taken collectively, they cannot properly justify an overall failure rate whereby more than a proportion of journeys (whether 5% is a reasonable proportion is a separate issue) operate outside a 12 minute window of tolerance. I would not, therefore, say, as the Transport Tribunal did, that these run-of-the-mill excuses were "properly rejected", but rather that they were properly allowed for by the Commissioner's preparedness to accept (a) all departures within the 12 minute window of tolerance, and (b) 5% of all departures outside that window.
41. Of course, so far as s.26 went, the Commissioner had no need in any event to reach a conclusion on reasonable excuse: he was amply entitled, as he did, to regard action here as appropriate simply because of the frequency of the appellants' failures.
42. With regard to s.111, however, the Commissioner had to be satisfied both of the frequency of the appellants' failures - in order to conclude that they had operated their services in breach of the timetabling requirements "to a significant extent" - and that this had occurred "without reasonable excuse". But note (as the Commissioner himself did in Section 2 of his decision) that the word used is "excuse" in the singular and note too the structure of the sub-section: the Commissioner has to be satisfied that there is no reasonable excuse for multiple failures. I do not read that as an invitation to explore in depth (with all the obvious practical difficulties that that would occasion) every individual excuse offered for each and every timetabling failure. Rather it invites a broad view to be taken of the operator's performance as a whole. Section 111, after all, provides for the crudest of penalties and should clearly only be invoked where the Commissioner is quite satisfied that the penalty is deserved.

Burden of proof

43. The appellants complain that the Commissioner put the burden on them to prove that they had a reasonable excuse for their failures. It is Mr King's submission that once the operator puts forward evidence of a reasonable excuse, "it is for the traffic area to eliminate the existence of that defence to the satisfaction of the Traffic Commissioner and the Transport Tribunal". He relies in support of this submission upon cases in the criminal law such as R v Clarke [1969] 1WLR 1109 which held in the context of breathalyser legislation, that once there is some evidence of reasonable excuse for failing to provide a specimen, it is for the prosecution to eliminate the existence of such a defence to the satisfaction of the jury. In my judgment, however, that principle has no application in the present situation. Rather I would regard this as a classic case for holding that the burden lies squarely upon the operator to prove that he had reasonable excuse for his overall failure to meet the timetabling requirements. Three considerations to my mind combine to support such a view. First, even in a criminal case, if an ingredient of an offence relates to a matter peculiarly within the accused's own knowledge (as must existence of a reasonable excuse), the onus is generally on the accused to prove the exculpating fact. Secondly, throughout the law, there is a general rule that those who seek to rely on exceptions (which include excuses) must establish them (on the balance of probabilities). Thirdly, the Traffic Commissioner's jurisdiction is essentially inquisitorial rather than adversarial in nature, and, there being no one to adopt a prosecutor's role of seeking to disprove any excuses proffered, it should be for the operator to establish them.
44. All that said, the question of where the burden lies in these cases is hardly likely to prove determinative, least of all given the Commissioner's broad brush approach and that he is unlikely to impose the s.111 penalty except in a case he regards as clear-cut.

The 95% benchmark

45. As is plain from the Commissioner's decision, the requirement for a 95% success rate (taking account of the everyday difficulties of operating a timetabled bus service) stemmed in part from what he had learned throughout the series of inquiries from "a number of very senior and experienced executives from the industry" and in part from what had been "laid down by the Senior Traffic Commissioner" - a reference to the decision in the Midland Bluebird case in which the Commissioner had observed that some figure had to be taken as a rule of thumb in the absence of specific evidence on the point and he would fix on 5%: "If you think that's wrong you bring some evidence". Mr King quarrels with that approach from several standpoints. First, he complains that the figure was an arbitrary one and had never been specifically put to the appellants for their comments. Next he complains that the Commissioner ought not to have taken account of what he had been told by other operators in the course of the other inquiries. Most of all, however, he complains simply that the figure is unrealistic and unfair: it is just not practicable, he submits, to achieve this level of success in inner city conditions.
46. Before addressing these arguments in the context of the present appeal, it is worth noting the marked impact which the Buchanan Report has already had in other cases raising the benchmark issue. Two such cases came together before the Transport Tribunal (again presided over by Mr Carlisle QC) as recently as January 2001, appeals respectively by Yorkshire Rider Limited from the decision of the Transport Commissioner for the North East Traffic Area in September 2000, and by First Bristol Buses Limited from the decision of the Traffic Commissioner for the Western Traffic Area in October 2000. The operators in each case had called evidence before the Commissioner from those involved in preparing the Buchanan Report (then still to be published) respectively Mr Pyatt in the Yorkshire Rider case and Mr Buchanan himself in the Bristol case. Both witnesses had given evidence by reference to their firm's researches to the effect that the 95% reliability figure was totally unrealistic. That evidence notwithstanding, the operators had failed to satisfy the Commissioners. Let me quote just this passage from the Commissioner's decision in Yorkshire Rider:

"[Mr Pyatt] believed that a reliability figure of 95% was totally unrealistic. This is a figure used by all traffic commissioners in this country and if he wishes to challenge such a benchmark, then I believe he needs to produce firm statistical evidence to that effect. Perhaps he will do that when the paper, which he is involved in producing, is ready for publication later this month. ... Our rule of thumb figure of 95% is based on the collective experience of the Traffic Commissioners acting as regulators of all the bus companies in all the towns and cities of Scotland, England and Wales. We know what can be achieved because many operators in comparable cities and towns achieve it. I hope Mr Pyatt's paper takes account of that."

47. The Transport Tribunal allowed both appeals. The appeal in Yorkshire Rider was allowed because:

"First, [the Commissioner] failed properly to take into account the various excuses. [The Tribunal had earlier held that because the sample in Yorkshire Rider was so limited compared to that in the instant case (182 compared to 1283), every excusable failure should have counted.] Second, he failed to take into account the limited size of the sample, which put the case into a different category than Stagecoach Ribble. Third, he failed to give any weight to Mr Pyatt's evidence that the 95% approach was unachievable. Fourth, he gave no weight to the company's evidence to the same effect."

48. The Tribunal's reasons for allowing the First Bristol Buses appeal were essentially these:

"... This was indeed a situation where an operator sought to establish, with detailed expert evidence, that Bristol was a special case. Of course, the fact that such evidence is called does not mean that a Traffic Commissioner is bound to accept it ... but it does mean that the Traffic Commissioner has to consider it carefully and then to give reasons if he is going to reject it. ... We have to say that the Traffic Commissioner does not give any analysis of his reasoning at all. ... What did he make of Mr Buchanan's warnings about the unreliability of the sampling? What about traffic conditions in Bristol itself? There was overwhelming evidence to the effect that traffic congestion in the city is particularly bad: did he accept that it was a special case? We recognise the difficulties that the Traffic Commissioner faced but think that some analysis was necessary in the light of the evidence which was presented to him. ... "

49. Valiantly though Mr King strove to pray in aid those decisions in support of the present appeal, in my judgment their reasoning on the contrary militates against it. The critical difference between those two cases and this is, of course, that whereas in them specific evidence was called as to realistic reliability rates, here it was not. The Transport Tribunal itself (under the same President throughout) did not regard the later cases as invalidating their own earlier decision. On the contrary, one of the reasons they gave for distinguishing the present case from Yorkshire Rider was the latter's much smaller sampling size. To my mind those decisions throw no doubt upon the lawfulness of the Commissioner's approach in the present case given, as his decision expressly noted, "the absence [before him] of persuasive research as to what level of adherence to timetable it is reasonable to expect a city centre operator to achieve".
50. That conclusion, however, is not of itself necessarily fatal to Mr King's arguments which still fall to be considered their on intrinsic merits. Was it, then, unlawful in the pre-research era to fix on the 95% benchmark? In my judgment it was not and nor was it unlawful in doing so to have regard to such general experience as could be gleaned from (a) other traffic commissioners' experience and decisions (at the time of the commissioner's decision in the present case solely that of the Senior Traffic Commissioner in Midland Blackbird but later, as the Commissioner in the Yorkshire Rider case observed, "the collective experience of [all] the traffic commissioners"), and (b) whatever information he as an individual traffic commissioner had acquired in the course of inquiries he himself had held. Traffic commissioners and, of course, the Transport Tribunal, exercise a specialist jurisdiction and inevitably build up a body of expertise in this field. It seems to me quite unrealistic to suggest that they must put this aside when adjudicating on any particular case and confine themselves solely to such evidence as may be called in that case. Equally it seems to me unnecessary for them to notify the operator whose services they are investigating of the experience or information they have acquired or the particular approach they propose to adopt. In all these cases the operator knows in detail what the monitoring exercise has revealed. It is for him then to decide what evidence to call to escape penalty under the Act.
51. It is not as if failure to attain the 95% benchmark invariably triggered the statutory sanctions. Far from it. As the series of decisions resulting from this very monitoring exercise shows, 11 of the 12 operators failed to achieve a 95% reliability rate and yet in only two of the cases was the S.111 penalty imposed, namely on these appellants who had a failure rate of 12.5% and on Dennis's Coaches whose failure rate was 20%. In several other cases where the failure rates were between 7% and 12%, the Commissioner merely gave warnings.
52. In future, of course, as Miss Grey expressly recognises, commissioners may have to adopt a more sophisticated approach now that evidence is being made available on just what success rates are realistically attainable. Will it, one wonders, continue to make sense to fix any benchmark figure at all? The better approach may simply be to contrast the actual success rate achieved with that (a) suggested by research evidence to be realistically attainable, and (b) achieved by other operators in comparable circumstances, and then simply apply the legislation by reference to those essential comparisons. That, however, is for the future. So far as this decision is concerned, I would not regard it as flawed merely because of the introduction of a 95% benchmark into its chain of reasoning.

The comparison made

53. Mr King submits that the monitored failures should have been compared not with the total number of journeys (or services) monitored but rather with the entirety of the operator's services, monitored or not.
54. This submission I can deal with very shortly. It is founded principally upon a decision of the Transport Tribunal in Evans Coaches Limited in 1991 in which the Tribunal, when quashing the Traffic Commissioner's decision, said this:

"In our judgment the Traffic Commissioner misdirected himself both in attaching the condition under section 26 and making the determination under section 111 by failing to set the 50, or thereabouts, failures in the context of the appellant company's operation of all its registered services. He should have made some assessment in broad terms of the number of registered local services not included in the breaches and of the total route mileage covered without fault. ... Unless this task is undertaken there is no yardstick by which the frequency of the breaches can be measured against possible inconvenience to the public which may arise if the condition imposed under section 26 applies to all the appellant company's registered local services ... "

55. It is to be noted, however, that the condition attached to the operator's licence in that case had indeed prohibited them from providing any local services of any description. The Tribunal remitted the case to the Commissioner for him to "reconsider at a further public inquiry in the light of this judgment what is the appropriate order to make under section 26".
56. The condition imposed in the present case was by no means so far-reaching and, no less importantly, the survey appears to have been more wide-ranging. Indeed, this latter point seems to me decisive of the issue. If, as I have already concluded, the Commissioner was entitled to regard the sample of journeys monitored here as sufficient and representative of the appellant's operation as a whole, then plainly it was appropriate to make the comparison he did and to extrapolate from it as he did.

Conclusion

57. It follows that I for my part would reject each one of the grounds advanced by Mr King on this appeal. As already indicated, I recognise that the Commissioners' approach to the exercise of their ss.26 and 111 powers is likely in future to be more scientifically based than at the time of this decision. That, however, is not a criticism of earlier attitudes, merely a reflection of the operators' practice nowadays of adducing properly researched evidence at the inquiry. And I would add this. It remains important that these statutory powers should not be emasculated by an over-elaborate approach to the investigation or an unnecessary attention to detail. Ultimately, broad judgments have to be made as to the adequacy and reliability of an operator's published services. Commissioners should continue to impose sanctions on those who seriously fail the travelling public.

LORD JUSTICE LONGMORE:

58. I agree.

THE MASTER OF THE ROLLS:

59. I also agree that this appeal should be dismissed, for the reasons given by Lord Justice Simon Brown. I would simply add the following observations on the ground of appeal which Mr King QC put at the forefront of his case - that the Traffic Comissioner had based his conclusions upon a global assessment of the results of the total journeys monitored rather than on an assessment of each of the 26 services on which journeys were monitored. The effect of this was that a finding of a 12.5% failure rate did not indicate that each of the 26 services was subject to this rate of failure. Some services performed better than the 12.5% failure rate and others worse. The Traffic Commissioner was, of course, well aware of this. The individual services received individual consideration when examining the matters put forward by the Respondent as constituting "reasonable excuse". I can see no reason why, when considering the adequacy of operations of the 26 services that were monitored, it was not open to the Traffic Commissioner to consider this question in the round by adopting a global approach.
ORDER:
60. Appeal dismissed
61. No order as to costs
62. Leave to appeal to the House of Lords refused.
(Order does not form part of approved Judgment)