Neutral Citation Number: [2009] UKUT 263 (AAC)

Appeal No.  2009/483

IN THE UPPER TRIBUNAL            

ADMINISTRATIVE APPEALS CHAMBER

TRAFFIC COMMISSIONER APPEALS

ON APPEAL FROM THE DECISION OF

Joan Aitken TRAFFIC COMMISSIONER for the

SCOTTISH TRAFFIC AREA Dated 24 July 2009

Before:

Judge Frances Burton

Leslie Milliken

Stuart James

Appellant:

KYLE SEAFOODS LIMITED

Attendances:

For the Appellant:  S. O’Rourke, Advocate, instructed by D. Burd of

                                                       Anderson MacArthur Solicitors

Heard at:                       Eagle Building, Glasgow

Date of hearing:           27 October 2009

Date of decision:         27 November 2009

DECISION OF THE UPPER TRIBUNAL

IT IS HEREBY ORDERED that this appeal be DISMISSED.

REASONS FOR DECISION

1.           This was an appeal against the Decision of the Traffic Commissioner for the Scottish Traffic Area dated 24 July 2009 when she refused the Appellant company’s application dated 14 February 2009 for a restricted goods vehicle operator’s licence with authority for 2 vehicles and 0 trailers.

2.           The factual background appears from the documents, the transcript of the public inquiry and the written decision of the Traffic Commissioner and is as follows.

(i)               The application was made as the Directors, Brian and Christine Philp, had taken over another company which had held an operator’s licence and had on 8 October 2007 told the Traffic Area Office that they wished to take over that company’s licences without apparently realising that such licences were not transferable. On 15 November 2007 the Traffic Area Office had explained the non-transferability and sent a new starter pack, advising that it was an offence to continue operating on the former company’s licence and indeed without an interim licence being granted. During the course of processing the new application it had become apparent that the company taken over, Amazon Seafoods (UK) Ltd, had gone into liquidation and the Traffic Area Office had neither been informed nor had the discs returned. The Amazon licence had been suspended on 28 May 2008. It appeared that the Director of Amazon, also a Director of Kyle Seafoods Ltd, had been involved in unlawful operation of goods vehicles since 2006. In the circumstances both Mr Philp and Kyle Seafoods Ltd were called to public inquiry set for 9 September 2008 and the application for an interim licence refused.

(ii)              It appeared that Mr Philp and his solicitor, Mr D. Burd of Anderson MacArthur of Portree, Solicitors, neither understood nor accepted that licences were not transferable and that there was therefore significant unlawful operation. Despite the Traffic Area Office’s explanation they kept requesting an interim licence (which was refused on 19 June 2008, 15 July 2008 and 21 October 2008). They were clearly advised by letter of 11 June 2008 to await the public inquiry consideration of their full licence application and that the company could not lawfully operate until it was granted. The public inquiry did not take place on 4 September 2008: despite the letters of 10 July 2008, 17 July 2008 and 5 August 2008 telling them of this date at 2 pm at Inverness, the Applicant company’ssolicitor notified his non-availability and requested an adjournment. The public inquiry was refixed for 19 November 2008. Again Mr Burd notified his non-availability due to a court engagement in Lochmaddy. This adjournment was refused on the grounds that alternative arrangements should have been made for his client’s representation. The Deputy Traffic Commissioner duly presided at the public inquiry on 19 November 2008, when Mr Philp attended unrepresented and Traffic Examiner Haddow represented VOSA. The DTC asked Mr Philp if he was happy to be unrepresented and received an affirmative answer although the transcript indicates that the DTC was not entirely happy with this answer and that he had eventually adjourned the public inquiry when Mr Philp indicated that he was unable to deal with certain matters as they were sub judice pending criminal proceedings scheduled for hearing on 23 January 2009. Meanwhile the DTC granted an interim licence for 1 vehicle.

(iii)            There was then protracted correspondence between Mr Burd and the Traffic Area Office in connection with the DTC and a member of staff giving evidence in the criminal proceedings, and persistent adjournment of trial dates, causing the DTC to become so irritated with the Applicant’s solicitors that he felt he must recuse himself from the adjourned public inquiry, so the hearing was taken over by the Traffic Commissioner and refixed on 17 July 2009 at Inverness.

(iv)            Mr S. O’Rourke, Advocate, appeared for the Applicant company, instructed by Mr Burd, with Mr Philp present. TE Michael Dunlop appeared in place of his colleague, TE Haddow. In the meantime the Amazon licence had been revoked by the DTC. TE Haddow had provided addenda to her reports dated 18 November 2008 and 27 November 2008, there was a transcript of the hearing of 18 November 2008 and correspondence between VOSA and Mr Philp in 2005. The Applicant produced accounts for year ending 28 February 2009 and a VOSA booklet dated 2007 with highlighted excerpts supporting Mr Philp’s view that tachograph rules did not apply to Kyle Seafoods Ltd. The Traffic Commissioner also had the liquidator’s report for the Amazon liquidation showing Mr Philp as a Director and Christine Philp as Company Secretary. Amazon had gone into compulsory liquidation with a winding up order dated 31 March 2006, a deficiency of £4,410,103 and £308,090 owed to ordinary creditors. There were s.43 certificates dated 15 November 2007, 20 August 2007 and 13 February 2008 showing no goods vehicle operator licence for Kyle Seafoods Ltd on any of these dates.

(v)             On 4 July 2008 the Traffic Examiner had been asked to establish if Kyle Seafoods Ltd was operating. The Appellant company had made an application for a licence and specified 2 vehicles, one of which was registered to Amazon Seafoods Ltd and the other recorded as transferred to the motor trade. On 7 July 2008 the Traffic Examiner noted both parked outside the Appellant company’s premises, and later in the day saw one being loaded with boxes bearing the name Amazon Seafoods and being driven away. This vehicle was the one allegedly transferred to the motor trade. She called and spoke to an employee who said that vehicle was being driven by Mr Philp to deliver fish. She contacted Mr Philp by mobile phone and asked him to return, indicating that she was concerned he was operating without a licence and he said he had no option but to do so. Mr Philp then told her he had been in business since 1979 and had moved to Kyle of Lochalsh in 1983. He had put Amazon into liquidation in March 2006 for financial reasons but did not think he needed to tell the Traffic Commissioner as nothing had changed: he was still using the same workforce operating the same business. He had become a Director of Kyle Seafoods Ltd on 1 April 2006, and in November 2006 decided to change his operator licence. He admitted that he should have stopped operating but this would have put 12 people out of work, as there were no suitable hire vehicles. He said he had been using the 2 vehicles respectively for 4 and 3 years and had not notified these changes of vehicles to the Traffic Commissioner (as others had been specified on the Amazon licence as the Traffic Commissioner’s investigations had discovered). He had since also bought a 3.5 tonne vehicle when he did not get an interim licence.

(vi)            The Traffic Examiner returned to the business premises and took copies of these 2 vehicles’ documents and some tachograph charts. She found that 95,354 kms had been recorded by the 2 vehicles since 2006. Her report gave some history of the Amazon licence showing incidents when vehicles had been stopped in 2004 and 2006 for tachograph offences by TE Harvey at one of which he told TE Harvey that he did not care about the regulations and should only have had a warning. Mr Philp subsequently wrote a letter of complaint dated 28 July 2005 to VOSA to which the reply, on 16 August 2005, stated that Mr Philp’s behaviour towards TE Harvey would not be tolerated. The trial listed for 23 January 2009 turned out to be in respect of further unauthorised use on 13 February 2008 where one of the vehicles was stopped on a journey from Kyle of Lochalsh to the East Coast, driven by a Mr Asiedo. On 25 July 2008 the same vehicle was stopped when driven by Mr Philp delivering prawns.

(vii)           It appeared that Mr Philp’s correspondence with VOSA in 2005 concerned claims that he needed no tachograph charts for taking the vehicle stopped by TE Harvey to its safety inspection, but VOSA did not agree that this required no chart. He had also attempted to claim tachograph exemption for delivering fish from his premises as an extension of the valid exception for carrying live fish or a catch from the place of landing to a processing place, and other rules Mr Philp claimed applied to his circumstances were not available as he had read them out of context.

(viii)         Mr Philp gave evidence at the public inquiry of his history in the fishing business. He explained the advice he had received to put Amazon into liquidation. He had scored out the initial answer to the question about liquidation as the application form’s Notes said he should not include anything more than 12 months old. The Traffic Commissioner was invited to grant the application but indicated to the Appellant company’s counsel that although Mr Philp had apologised for the inconvenience to the DTC and the Traffic Commissioner the unlawful operation could not be overlooked. She found that he had been told and had understood about the unlawful operation and had not applied for a licence for Kyle Seafoods Ltd when he should have done so, and that he had contrived to operate, purportedly on the Amazon licence, after that company had gone into liquidation. On any view there was extensive, deliberate operation without a valid operator licence, which was well known to be unauthorised use. The Traffic Commissioner was also critical of the behaviour of Mr Burd. The Traffic Commissioner rejected Mr Philp’s suggestion that he could not afford to operate legally as, having seen his unaudited accounts, and heard about the average length of his company’s journeys to the coast, she had deduced that he could well afford to use outside haulage without imperilling his business. She decided that, despite adequate maintenance of the vehicles, she could not overlook the ignorance of non-transferability of the licence because of the extended unauthorised use which had been persistent and continuing, and also his attitude to the regulations and his resistance to accurate VOSA advice, which she said went to fitness. The full licence application was refused and the interim licence therefore fell with it.

3.           At the hearing of the appeal Mr O’Rourke again appeared for the Appellant company. He said that Mr Philp was a long standing operator and submitted that it was not reasonable to refuse a licence if the operator apologises and explains any shortcomings. We explained to Mr O’Rourke that we could not agree with him. Mr Philp had been clearly told about unauthorised use but had not desisted over a long period even when caught several times. He had not made an application immediately or even relatively promptly. However Mr O’Rourke persisted that the written decision was incorrect in several places. The unlawful operation had not been pursued with malice. We pointed out that the unauthorised use had constituted unfair competition and had been deliberately chosen as a course of action for commercial gain. He nevertheless persisted that the Traffic Commissioner had made much too much of the DTC’s recusal and that that was unfair. This was an irrelevant factor to take into account. She had also given insufficient weight to the DTC’s grant of an interim licence, with which he had clearly thought it right to balance the delay of the adjourned hearings.

4.           We explained to Mr O’Rourke that we could see no instance where the Traffic Commissioner had been wrong. Mr Philip had brought the sanction for unauthorised use upon himself. He had not helped himself at all by his attitude to the regulations, his confrontations with VOSA or his self satisfied approach to compliance, or rather repeated and sustained lack of it. This outweighed any positive factors that might have been in the Appellant’s favour. The Traffic Commissioner had given lengthy and detailed consideration to the Appellant company’s case and made a fair and proportionate decision. Accordingly the appeal is dismissed.

 Frances Burton

27 November 2009