England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
DIVISIONAL COURT

		Royal Courts of Justice Strand London WC2
		Tuesday, 14th March 2006

Tuesday, 14th March 2006

1. MR JUSTICE SULLIVAN: This is an appeal by way of case stated from the decision of the South East Wiltshire Justices sitting at Salisbury Magistrates' Court on 21st February 2005 convicting the appellant company of unlawfully using a goods vehicle on a road for the carriage of goods without an operator's licence contrary to subsections 2(1) and 2(5) of the Goods Vehicles (Licensing of Operators) Act 1995 ("the Act"). The justices found the following facts:

A. Cleansing Services Group Limited (the appellant) operated a business, which included the transportation and disposal of waste materials. On 13th May 2004 the appellant held a Standard National Operator's Licence in the Western Traffic Area authorising the use of 124 vehicles and 27 trailers. 87 vehicles were specified on the licence at that time. The appellant also operated a number of agricultural tractors. These were not specified on the Operator's Licence. The vehicles were subject to finance agreements and the finance company was the registered keeper.

B. Since July 2003 the appellant company had a contract with Wessex Water to remove processed sewage in the form of biosolids and transport it to agricultural establishments (farms) where they would either spread the sewage on the land or place it for storage and spread it later.

C. The appellant used agricultural tractors to carry out that work. They would receive the address of the farm from Wessex Water whereupon they would contact the farmer and make detailed arrangements to deliver the sewage and either spread it as required or stockpile it. The appellant would deal with complaints from the farmer.

D. Cleansing Services Group Limited used one of the agricultural tractors to tow a trailer carrying the biosolid sewage waste to transport it from the sewage works to the agricultural farm.

E. Johan Phillips of Souter's Farm, Longbridge, Wiltshire, has received sewage waste from Wessex Water Company over a period of four years and previously in the early 1980s. There was no formal or written agreement with Wessex Water, it was simply an oral arrangement. Cleansing Services Group Limited made arrangements under their contract with Wessex Water to collect the biosolids, deliver them to Souter's Farm and deposit them as directed by the farmer. Those arrangements were made verbally. No payment was made or expected between the farmer and either Wessex Water or Cleansing Services Group Limited. The agreement was that Souter's Farm would receive sewage material from Wessex Water who would deliver it to the farm and spread or deposit it where directed by the farmer.

F. On 13th May 2004 James Lee Smith was driving an agricultural tractor, registered number HF03 HTZ, on behalf of the appellant on a public road, the A36 at Warminster, Wiltshire. The tractor was towing a trailer. The appellant was employing James Lee Smith and the tractor and trailer were part of the appellant's business equipment. Thereby the appellant was using the tractor. At that time the vehicle was not specified on the appellant's Good Vehicles Operator's Licence. The trailer contained processed sewage materials in the form of biosolids, which were being delivered on behalf of Wessex Water Company to Souter's Farm, Longbridge, Wiltshire, with the intention of spreading it on fields at the farm.

G. The transporting to, and the spreading of, the sewage material at Souter's Farm was agricultural work.

H. The keeper of the vehicle, tractor HF03 HTZ, was not the occupier of Souter's Farm.

I. The registered keeper of the tractor was a finance company.

J. Cleansing Services Group Limited were not employed by the occupier of Souter's Farm to do agricultural work on the farm.

2. The justices then set out the parties' contentions. For the purposes of determining this appeal it is unnecessary to rehearse those contentions at any length. In summary the appellant contended before the magistrates, and before this court, that the use of the tractor and trailer in these particular circumstances did not require an operator's licence because the use fell within one of the exemptions provided for by regulation 33 of the Goods Vehicles (Licensing of Operators) Regulations 1995 ("the Regulations"). Regulation 33 cross refers to schedule 3 to the Regulations which lists "Classes of Vehicles for which a Licence is not Required." Class 1 is:

"Any tractor as defined in paragraph 4(3) of Part IV of Schedule 1 to the Vehicle Excise and Registration Act 1994 (as originally enacted) while being used for one or more of the purposes specified in Part II of this Schedule."

3. There is no dispute between the parties that the tractor used in the present case falls within the statutory definition in the 1994 Act. The question for the justices was whether it was being used for one or more of the purposes specified in part II of the schedule. Those purposes are:

"1. Hauling -

(a) threshing appliances;

(b) farming implements;

(c) a living van for the accommodation of persons employed to drive the tractor; or

(d) supplies of water or fuel required for the tractor.

2. Hauling articles for a farm required by the keeper, being either the occupier of the farm or a contractor employed to do agricultural work on the farm by the occupier of the farm.

3. Hauling articles for a forestry estate required by the keeper where the keeper is the occupier of that estate or employed to do forestry work on the estate by the occupier or a contractor employed to do forestry work on the estate by the occupier.

4. Hauling within ... 15 miles of a farm or forestry estate occupied by the keeper, agricultural or woodland produce of that farm or estate.

5. Hauling within... 15 miles of a farm or a forestry estate occupied by the keeper, material to be spread on roads to deal with frost, ice or snow.

6. Hauling a snow plough or a similar contrivance for the purpose of clearing snow; and

7. Hauling -

(a) soil for landscaping or similar works; or.

(b) a mowing machine,

Where the keeper is a local authority."

4. Paragraph 2 in part II of the schedule was in issue in the present case. There was no dispute that the biosolids were "articles" for the purposes of the paragraph and that transporting them to, and spreading them on, the farm was "agricultural work" for the purposes of the paragraph. The appellant contended: (1) That "the keeper" in the context of paragraph 2 was a reference to the keeper of the farm and not the keeper of the vehicle; and (2) that even if the keeper was the keeper of the vehicle the appellant was still "a contractor employed to do agricultural work on the farm by the occupier of the farm."
5. "Keeper" is defined in regulation 3 which provides, so far as material:

"In these Regulations, unless the context otherwise requires -

...

"Keeper", in relation to a goods vehicle, is the person in whose name the vehicle is registered under the Vehicle Excise and Registration Act 1994."

6. The justices were of the opinion that:

(i) The biosolids were "articles" within the meaning of schedule 3 part II paragraph 2 of the Goods Vehicles (Licensing of Operators) Regulations 1995.

(ii) In schedule 3 part II paragraph 2 of the Goods Vehicles (Licensing of Operators) Regulations 1995, "keeper" means the user of the vehicle in question on the date and time of the alleged offence, not necessarily the occupier of the farm or the registered keeper of the vehicle.

(iii) The exemption in schedule 3 part II paragraph 2 of the Goods Vehicles (Licensing of Operators) Regulations 1995: "Hauling articles for a farm required by the keeper, being either the occupier of the farm or a contractor employed to do agricultural work on the farm by the occupier of the farm", is to be interpreted strictly in accordance with the ordinary words used and the "keeper" of the vehicle must either be the occupier of the farm or a contractor employed to do agricultural work on the farm by the occupier of the farm.

(iv) The appellant company was the "keeper" of the vehicle and although they were employed to do agricultural work on the farm they were not so employed by the occupier of the farm and therefore their use of the tractor did not come within the exemption.

7. Accordingly the justices found the case was proved and made a conditional discharge order for a period of 12 months and ordered that the appellants pay the sum of £1,000 costs of the prosecution.
8. The justices posed the following questions for the opinion of the court:

(i) Does the word "keeper" in schedule 3 part II paragraph 2 of the Goods Vehicles (Licensing of Operators) Regulations 1995 (the regulations) mean:

(a) the registered keeper of the vehicle as defined by regulation 3 of the regulations.

(b) the user of the vehicle.

(c) the occupier of the farm or a contractor employed to do agricultural work on the farm by the occupier of the farm?

(ii) Must there be a direct contractual relationship between the occupier of the farm and the person employed to do agricultural work on the farm for the exemption in Schedule 3 part II paragraph 2 of the Goods Vehicles (Licensing of Operators) Regulations 1995 to apply?

(iii) Where there is a contract between the occupier of the farm and another person which includes agricultural work on the farm, and that other person contracts the work on the farm to another (third) person, is it correct that there is no direct contractual relationship between the occupier of the farm and that third person, in this case the appellant?

(iv) Were we correct to decide that the use of the vehicle by the appellant at the time and date of the alleged offence did not fall within the exemption in schedule 3 part II paragraph 2 of the Goods Vehicles (Licensing of Operators) Regulations 1995?

9. The respondent contends that "the keeper" in part II of the schedule, including paragraph 2, means the keeper of the vehicle, not the keeper of the farm and that the keeper of the vehicle is defined by regulation 3 as the registered keeper, which in the present case was a finance company, not the appellant (see finding of fact J above).
10. For the reasons given below, I find it unnecessary to decide whether, in the context of paragraph 2, or indeed the other paragraphs in part II of schedule 3, the keeper must invariably mean the registered keeper of the vehicle.
11. It is difficult to see why a farmer who is relying on finance from a finance company to purchase his tractor, should be in any worse (or better) position for the purposes of the exemption than a farmer who has been able to purchase his tractor outright. Similar observations would apply to a local authority that is purchasing its mowing machine with the assistance of a finance company rather than outright. It will be recalled that the definition in regulation 3 applies unless the "context otherwise requires".
12. I find it unnecessary to resolve this issue because I am in no doubt whatsoever that paragraph 2 is referring to the keeper of the vehicle, whoever he may be, and not to the keeper of the farm in question. In his submissions before this court, Mr Laprell accepted that this was his position. As Mr Nesbitt pointed out in his skeleton argument on behalf of the respondent, "keeper" is a term of art used in relation to vehicles in the Act and the Regulations and its use in the remainder of part II of the schedule, for example in paragraph 7, makes it clear that it is being used to refer to the vehicle keeper. Whatever the answer to question 1 may be, it is most emphatically not option (c).
13. I turn therefore to the central issue in the case, whether the appellant was "...a contractor employed to do agricultural work on the farm by the occupier of the farm" (my underlining). The short answer to this question is "no", because, if possible, paragraph 2 must be interpreted in such a way as to give effect to each and every word in the paragraph and the words I have underlined cannot be ignored.
14. On behalf of the appellant, Mr Laprell submitted that since the legislation imposes criminal penalties, the exception in paragraph 2 should be broadly construed. It was plain that the word "employed" was not used simply to connote a master and servant relationship. It would be inappropriate for there to be such a limitation bearing in mind that one was concerned with a contractor who would be employed as an independent contractor. Thus, once the word "employed" had been given a somewhat broader meaning than simply a master and servant relationship, the question was how broad should that meaning be. It was perfectly permissible to use the word "employed" in the sense of "use", as in: "I employed the following methods to do X". He submitted, therefore, that if "employed" could and should be given a broad meaning, there need be no contractual relationship between the contractor and the occupier of the farm.
15. While I accept Mr Laprell's submission that "employed" was not intended to be confined to a master and servant relationship, the use of the word "contractor" makes that sufficiently clear, I am unable to accept the submission that a contractor will be employed to do agricultural work on a farm "by the occupier of the farm" if there is no contractual arrangement of any kind between them. "Employed" should not be construed in isolation. It is to be construed in conjunction with the word "contractor". In ordinary language if a contractor is employed by someone to do something that necessarily implies some contractual arrangement between them.
16. The short answer to the appellant's submission is that the appellant was employed by Wessex Water to haul and then spread the biosolids, albeit at the farmer's direction. It was not employed by Mr Phillips of Souter's Farm.
17. Mr Laprell submits that if Mr Phillips had been responsible for arranging transport and/or spreading the biosolids, and had entered into an agreement with the appellant, then that would be within the exception in paragraph 2 even though the same load would be being carried in the same vehicle, on the same journey, by the same route. In these circumstances, he asked rhetorically, why should it make any difference that the contract is between the appellant and Wessex Water when the end result, in practical terms, is the same?
18. I accept that it would be possible to reorganise the contractual arrangements so as to take advantage of the exemption, but, in my judgment, the fact that this would be possible does not mean that there is any illogicality in the respondent's interpretation of the exception.
19. Some system of regulating haulage operators is clearly required in order to protect public safety. It is therefore understandable that Parliament has prescribed the limits placed upon the exceptions with some care. In my view it is not a question of giving the exceptions a broad or a narrow interpretation. There is no reason to give them anything other than their ordinary and natural meaning. As I have already indicated, the ordinary and natural meaning of a contractor being employed by someone to do something is that there is some contractual nexus between them.
20. The underlying rationale of the exemption is clear. It is aimed at farmers, or their contractors, driving their own tractors, carrying things required for their own use, on the farm. In these circumstances the haulage will be an incidental part of the agricultural work done on the farm by the farmer or his contractor. The exemption is not intended to assist those like the appellant, whose essential business is road haulage, who are neither farmers nor employed by farmers to do agricultural work on their farms. As I have indicated, while the spreading was carried out by the appellant at the direction of the farmer, it was an incident of the haulage contract between Wessex Water and the appellant.
21. For these reasons I would answer question 2 by saying that there must be a contractual relationship between the contractor employed to do agricultural work on the farm and the occupier of the farm. Since there was no such relationship in the present case the answer to question 4 is "yes". Question 3 does not, strictly speaking, arise, but the parties both indicated in their skeleton arguments that the answer should be in the affirmative.
22. Since the answers to questions 2 and 4 are sufficient to dispose of this appeal, I, for my part, would leave open the question whether the keeper of the tractor, for the purposes of paragraph 2, could, for example, be a farmer who is purchasing the tractor from a finance company, but would merely add that whatever may be the answer to question 1 it is most certainly not option (c).
23. LORD JUSTICE LATHAM: I agree.
24. Thank you both very much.
25. MR NESBITT: My Lord, there remains simply the issue of costs. In the ordinary way I would ask for the respondent's costs of the appeal.
26. MR LAPRELL: My Lord, I cannot resist that.
27. LORD JUSTICE LATHAM: Then the appeal is dismissed with costs. Thank you very much. If I may say so, very interesting arguments, and premised on something that must be made clear, that your company, or the company instructing you, Mr Laprell, was clearly seeking to act within the law if it could. The sentence reflects that.
28. MR LAPRELL: Yes, absolutely. I suspect the magistrates accepted that.
29. LORD JUSTICE LATHAM: They must have done.
30. MR LAPRELL: They must have, yes.
31. LORD JUSTICE LATHAM: Good.