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EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
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Lord Nimmo Smith
Lord Philip
Lord Kingarth
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[2006] CSIH 51
XA64/05
OPINION OF THE COURT
delivered by LORD PHILIP
in
APPEAL
under the Civic Government
(Scotland) Act 1982
in the cause
JAMES FERGUSON
Pursuer and Respondent;
against
DUNDEE CITY COUNCIL
Defenders and Appellants:
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Act: Crawford; Muir Myles Laverty, Dundee
(Pursuer and Respondent)
Alt: S.A.L. Wolffe; Haig Scott & Co. (Defenders and
Appellants)
3 November 2006
Introduction
[1] This
is an appeal by Dundee City Council against an interlocutor of the sheriff at
Dundee dated 17 May 2005, reversing the decision of the Council's Licensing
Committee dated 2 December
2004 suspending the respondent's taxi driver's licence for its
unexpired period which was due to end on 31 May 2005. At the
meeting on 2 December
2004 the Committee had before them a letter dated 31 July 2003 from the
Chief Constable of Tayside Police intimating that the respondent might no
longer be a fit and proper person to be the holder of a taxi driver's
licence. The grounds on which this
complaint was made were (i) that the respondent was exercising control and
management over Taxi Licence 159, issued in respect of a Skoda Octavia SC02 HTO
whilst not being the true licence holder;
(ii) that the respondent was paying £40 per week for the hire of the
licence plate to Bernard Owens, the true licence holder; and (iii) that the respondent had pretended
to an insurance company, Cabshield Insurance, that he was Bernard Owens, by
sending a fraudulent e-mail. The letter also drew the Committee's attention to
a number of convictions incurred by the respondent between 1977 and 1986.
The Committee's decision
[2] After
a hearing at which the respondent was present, but unrepresented, the Committee
suspended the respondent's taxi driver's licence. Their reasons were given in a letter to the
respondent's agents dated 22 December
2004 in the following terms:
"PC Alex
Selfridge, Cabs Enforcement Officer, Tayside Police, addressed the Committee on
behalf of the Chief Constable. He
advised the Committee that on 20 June
2003 he had received anonymous information that the Taxi Licence
of Bernard Owens was being hired out.
Upon checking the vehicle records relating to this licence, PC Selfridge
discovered a Rover motor car had recently been submitted for a test. Previously, the licence had related to a
Skoda Octavia. Later that same day, PC
Selfridge called at Mr Owens' home. Mr
Owens told PC Selfridge that the licence was for a Skoda and it was currently
in Fintry. He knew nothing of the
Rover. He said that Mr Ferguson was the
only driver although he did not know his address and that it was Mr Ferguson
who paid for the insurance. Mr Owens
also stated that he did not own the car and that it was Mr Ferguson who paid
for it. When it was put to Mr Owens that
he did not have management and control over the licence, he admitted receiving
£40 per week from Mr Ferguson for the hire of the licence. Mr Owens then surrendered the licence later
that day. A short time later,
Mr Owens spoke to PC Selfridge again, following receipt of documentation
relating to the vehicle excise licence and the insurance for the Rover. The insurers had shown Mr Owens an e-mail
allegedly sent by him cancelling the insurance policy. Mr Owens said that he had not sent the e-mail
and knew nothing about it. The Rover
motor vehicle had failed to pass the test and was never issued with a plate
since Mr Owens had surrendered the licence.
PC Selfridge made enquiries into the ownership of the Rover. This had been sold via the e-Bay
website and the purchaser was a taxi driver in Dundee for the
sum of £450. Although PC Selfridge was
unable to confirm the identity of the purchaser, Mr Ferguson is a registered
purchaser on e-Bay. The current registered
keeper of the Rover, a Mr Murphy, was also spoken to and he said that he paid
£700 for it from someone called 'Jim'.
Upon being shown a photograph of Mr Ferguson, Mr Murphy identified him
as the seller. The finance agreement for
the Skoda had also been in Mr Ferguson's name and Mr Owens had told PC
Selfridge that the licence was for that vehicle. Mr Owens knew nothing about the
Rover. In the circumstances, PC
Selfridge submitted that it was Mr Ferguson who had management and control over
the licence and not Mr Owens.
In reply Mr
Ferguson did not deny that he had obtained the finance to purchase the
Skoda. He had entered into a partnership
with Mr Owens. However, it turned out
that Mr Owens had been hiring his Taxi Licence to a number of different
people. Mr Ferguson broke off
communication with Mr Owens and he felt that Mr Owens was trying to blame
everything on him. The Skoda was only
one year old so there would be no point in taking it off and putting another
vehicle on instead. Mr Ferguson admitted
sending the e-mail to the insurers, but insisted that he did this on the
instructions of Mr Owens.
After considering
the information before it, the Committee decided by four votes to three that Mr
Ferguson was not a fit and proper person to be the holder of a Taxi Driver's
Licence, in terms of paragraph 11(2)(a) of Schedule 1 to the Civic Government
(Scotland) Act 1982. The Committee was
satisfied on a balance of probabilities that Mr Ferguson, and not Mr Owens, was
the person exercising management and control over the Taxi Licence. Your client accepted that the finance for the
Skoda was in his name and, whilst that is not conclusive in itself, there were,
in addition, other factors which led the Committee to this finding. The information provided by PC Selfridge
about the attempted substitution of the Rover was of great significance. The licence holder, Mr Owens, said he did not
know a different car had been submitted for a test. This was inconsistent with the notion of him
having 'management and control' of the licence.
The enquiries made by PC Selfridge pointed to Mr Ferguson as the
owner of the Rover. As soon as PC
Selfridge spoke with Mr Owens, the licence was surrendered. If Mr Owens' arrangement with Mr Ferguson
was above board, why surrender the licence and seek to implicate
Mr Ferguson? If Mr Ferguson is
correct and it is the case that others were involved in hiring the licence from
Mr Owens and not him, and that Mr Owens is seeking to pin the blame on
him, what is the explanation behind the sale and purchase of the Rover? When the Committee looked at the whole
circumstances of this case, it was drawn to the conclusion that Mr Ferguson was
effectively hiring Mr Owens' licence.
However, as far as the allegation regarding the e-mail is concerned,
there was insufficient information to decide whether or not this was done
fraudulently as suggested by the Chief Constable. The arrangement between Mr Ferguson and Mr
Owens was an attempt to circumvent the statutory licensing system and
effectively to allow Mr Ferguson to operate a taxi without applying for a
licence. This disregard for the
requirements of the said 1982 Act led the Committee to draw an adverse
conclusion as to your client's fitness to hold a Taxi Driver's Licence. The Committee decided to suspend the licence
for its unexpired period since it regarded this as a very serious matter. The licence was due to expire on 31 May 2005 and, therefore, the period
of the suspension amounts to 180 days."
[3] As
is recorded in the letter, the Chief Constable's letter of 31 July 2003 was
previously considered by the Committee at a meeting on 16 September 2003. At that meeting the Committee suspended the
respondent's taxi driver's licence for its unexpired portion. That decision was appealed to the sheriff and
was reversed by interlocutor dated 7 May 2004 and the case was remitted back to the Committee for reconsideration. The Committee reconsidered the matter at the
meeting on 2 December
2005 and again suspended the licence. That decision was again appealed
to the sheriff and was reversed by the interlocutor dated 17 May 2005 on the grounds that the
Committee's decision was based on incorrect material facts and the Committee
had exercised their discretion in an unreasonable manner. On that occasion the
sheriff declined to remit the case back to the Committee.
The sheriff's decision
[4] In
his note, the sheriff said that the onus was on the Chief Constable to provide
the necessary credible and sufficient evidence to overturn the presumption that
the respondent was a fit and proper person to hold a licence. He went on to find that new evidence,
presented on behalf of the Chief Constable at the hearing on 2 December 2005,
was too remote to be accepted by the Committee without being tested further,
and it was unsafe for them to accept the hearsay evidence of Bernard Owens and
Mr Murphy. The new evidence referred to
was to the effect that the police had traced the current keeper of the Rover
car, a Mr Murphy, who said that he had purchased the car on the e-Bay website
for £700 from a Dundee taxi driver whom he identified
from a photograph as the respondent. The
sheriff said that the reasonable enquiries which the Committee were permitted
to make by para 11(4)(b) of Schedule 1 to the Civic Government (Scotland) Act 1982 required
to be sufficient to meet an objective test of fairness and to allow the
Committee to come to an informed view of the facts. The enquiries which the Committee had made, confined
as they were to hearing submissions from the Chief Constable's representative
and from the respondent, were neither reasonable nor sufficient to allow them
to come to the decision which they did.
Further, the Committee had exercised their discretion in an unreasonable
manner in respect that they had based their decision on incorrect material
facts. The evidence provided by the
Chief Constable's representative was insufficient, on its own, to enable them
to decide the case on a balance of probabilities.
Submissions to this court
[5] In
presenting the appeal on behalf of the appellants, Mrs Wolffe argued, citing Chief Constable, Strathclyde Police v North Lanarkshire Licensing Board 2003
S.L.T. 1268, that it was in the discretion of the Committee to proceed on any
type of material which had a bearing on the question they had to decide. The assessment of the weight to be given to
such material was a matter for the Committee.
It was conducive to the speed and informality envisaged by the 1982 Act
to proceed on ex parte statements, as
the Committee had done. They were
entitled to come to the conclusion they had on the material before them. The sheriff had misdirected himself (a) by
placing the onus of demonstrating that the respondent was no longer a fit and
proper person to hold a taxi driver's licence on the Chief Constable; (b) by failing to apply the correct test,
namely whether any licensing authority properly directed could have reached the
decision the Committee did on the material before them, rather than whether it
was "appropriate" for them to do so; (c)
by interfering with the Committee's assessment of the material before them and
substituting his own view; and (d) by
finding that the Committee had erred in law by exercising their discretion in
an unreasonable manner and by basing their decision on incorrect material
facts.
[6] On
behalf of the respondent Miss Crawford argued that there was no material entitling
the Committee to conclude that the respondent had management or control of Mr.
Owens' taxi licence. It was for the
Committee to ascertain the correct facts from the material available to them,
and to consider whether that material formed a proper basis for a view of the
respondent's fitness. No reasonable
Committee properly directed would have proceeded on the basis that the evidence
provided by the Chief Constable's representative was correct. The sheriff was
right to hold that the Committee were not entitled to accept the hearsay
evidence of Mr. Owens and Mr Murphy, or to base their decision on it. The respondent was entitled to a presumption
that he remained a fit and proper person to hold a licence. The evidence relating to the attempted substitution
of the Rover car was not sufficient to demand an explanation from him. His silence on that topic should have been treated
as a denial. The Committee had proceeded on the basis of speculation and to
look to the respondent to respond to speculation or suspicion was to invert the
onus. In doing so they had relied on an
incorrect material fact and had exercised their discretion unreasonably.
Discussion
[7] The
scope of the discretion conferred on the Committee by para 11 of Schedule 1 to
the 1982 Act is wide. They are entitled
to proceed on any type of material which has a bearing on the question which
they have to decide, and it is for them to decide on its sufficiency and quality,
and the appropriate weight to be given to it. Accordingly, it was for the Committee to
decide whether to proceed on the basis of the information provided by the Chief
Constable's representative. The fact that the information included hearsay
evidence did not impinge on that discretion.
[8] The
Committee were told that anonymous
information had led the police to examine the records relating to the taxi
licence issued to Bernard Owens for the Skoda Octavia. When they did so they discovered that, a short
time previously, a Rover had been submitted for a roadworthiness test with a
view to substituting it for the Skoda. The
Rover failed the test, and an e-mail was sent in Mr. Owens' name by the
respondent cancelling the insurance policy relating to it. Mr Owens was contacted and confirmed
that his licence related to the Skoda but explained that he did not own
it. It had been paid for and insured by
the respondent who also paid him £40 per week for the hire of the licence. As far as he was concerned, the respondent
was the only driver. He knew nothing
about the Rover or about the e-mail. He surrendered
the licence immediately. Enquiries into
the ownership of the Rover revealed that it had been sold through the e-Bay
website to a taxi driver in Dundee for
£450. The identity of the purchaser was
not disclosed, but the respondent was found to be registered as a purchaser on
the website. The current keeper, a Mr
Murphy, was traced and identified the respondent from a photograph as the
person from whom he had bought the car for £700.
[9] The
respondent was given the opportunity to respond. He said he had entered into partnership with
Owens but broke off communication when he found that Owens had been hiring the
licence to a number of individuals. He
did not deny that he had obtained finance to purchase the Skoda. He impliedly denied attempting to substitute
the Rover for the Skoda but admitted sending the e-mail to the insurers of the
Rover, asserting that he had done so on Owens' instructions.
[10] On the basis of the police information and the respondent's
responses we are quite unable to hold that no reasonable Committee could have concluded
that the respondent was exercising management and control of Mr. Owens' taxi
licence. We did not understand Miss
Crawford to argue that, in those circumstances, it was not open to the
Committee to draw an adverse conclusion as to the respondent's fitness to hold
a taxi driver's licence. We shall
therefore allow the appeal.
