Neutral Citation Number: [2010] UKUT 173 (AAC)

Appeal No. T/2010/20

IN THE UPPER TRIBUNAL

ADMINISTRATIVE APPEALS CHAMBER

TRAFFIC COMMISSIONER APPEALS

ON APPEAL from the DECISION of

Nick Jones Traffic Commissioner for the

West Midland Traffic Area

Dated 26 February 2010

Before:

Frances Burton, Judge of the Upper Tribunal

Leslie Milliken, Member of the Upper Tribunal

John Robinson, Member of the Upper Tribunal

Appellant:

SUKHWINDER SINGH

T/A SANDWELL TRAVEL

Attendances:

For the Appellant: Geoffrey Littlewood and Anne Easton

of Woulfe Enterprises Limited, Transport Consultants

Heard at: Victory House

Date of hearing: 14 April 2010

Date of decision: 12 May 2010

DECISION OF THE UPPER TRIBUNAL

IT IS HEREBY ORDERED that this appeal be DISMISSED

REASONS FOR DECISION

1.           This was an appeal from the Decision of the Traffic Commissioner for the West Midland Traffic Area dated 26 February 2010, declining to reverse the automatic termination of the operator’s licence pursuant to s.52(2D) of the Public Passenger Vehicles Act 1981, for non-payment of the continuation fee by the deadline date.

2.           The factual background appears from the documents, including the correspondence and the Traffic Commissioner’s Decision, and is as follows.

(i)               A standard national operator’s licence was granted to Sukhwinder Singh on 18 February 2008 authorising 4 vehicles, at which point the operator elected to make annual payments of the licence fee. The annual fee was last paid on 30 December 2008. On 30 December 2009 an annual fee request was sent out for renewal of the licence by 31 January 2010 and, as the fee was not paid by this date, on 11 February 2010 the operator was duly notified that the licence had terminated automatically. By letter received on 16 February 2010 the operator responded stating that he apologised for the payment being late, the reasons for that being that he did not receive the letter requesting payment in time as it had only recently been received on 11 February 2010. This was because he had been out of the country for his son’s wedding in India from 21 January 2010 to 11 February 2010 and had left no-one in charge of his “business phone”. This explanation was referred to the Traffic Commissioner by a member of staff who noted that the operator had not changed his address and that “it was obvious he overlooked the payment due”, also reminding the Traffic Commissioner that the discs issued clearly state the expiry date. He recommended that the licence should remain terminated. The team leader supported this recommendation and the Traffic Commissioner, noting that there were no exceptional circumstances, confirmed that the request for reinstatement was refused. A letter dated 1 March 2010 informed the operator of this.

(ii)              The operator then appealed to the Upper Tribunal (Administrative Appeals Chamber – Transport) and on 4 March 2010, Anne Easton, Consultant Advocate, of Woulfe Enterprises Ltd, wrote to the Traffic Commissioner requesting a stay of the Traffic Commissioner’s decision on behalf of the operator, Sukhwinder Singh“T/A Sandwell Travel (now Sandwell Travel Ltd)”. The member of staff referring the matter noted the apparent change of entity and also checked Companies House records, to discover that Sandwell Travel Limited had actually been incorporated as long previously as 8 July 2009, but that the change of entity had not been notified to the Traffic Commissioner. The Senior Team leader had therefore recommended that the request for a stay be rejected and the operator advised to apply for a new licence in the name of the limited company as there had clearly been a change of entity which had in any case terminated the previous licence. The Traffic Commissioner confirmed his agreement with this analysis, and that, in view of the change of entity, the entity operating was not the entity that had been granted the licence, so was in fact operating without a licence. The Traffic Commission then concluded that it could therefore not be “appropriate” to grant a stay, as in the recent case of Rose & Sons Ltd 2009/518 where it had been confirmed that a stay could be granted in such circumstances in relation to goods vehicle licensing “where appropriate”. A stay was therefore refused by the Traffic Commissioner on 9 March 2010 and on 12 March 2010 Ms Easton notified the Upper Tribunal that a new licence in the name of Sandwell Travel Limited would be applied for, pending which they would proceed with their appeal. In fact the Notice of Appeal was dated 4 March 2010, and received by the Upper Tribunal on 8 March 2010.

3.           At the hearing of the appeal the Appellant was represented by Mr Littlewood and Ms Easton. Mr Littlewood submitted that there were good reasons for allowing the Appellant to pay late as he had been away in India for his son’s marriage and had not had sight of the letter requesting the renewal fee until his return to the UK in February 2010. He had then immediately tendered the fee, which had been by cheque which had been cashed on 19 February 2010. The business had been closed during his 3 weeks’ absence. He added that his client was not very knowledgeable about the legal aspects of operator licensing, although he understood the practical side perfectly and there were no road safety concerns. The client had obviously also not appreciated the impact of incorporation on the concept of change of entity, but whether technically incorporated or not the business was still the same. There was a highly satisfactory fleet inspection report and everything was in order.

4.           We explained to Mr Littlewood that, despite these assurances, the fact was that a licence could only be granted to a named person, whether that was a natural person or a corporation having a separate legal identity, and that in the present context the original licence holder had now ceased trading following the incorporation of the limited company: this in turn meant that the limited company had in fact been operating without a licence, which was much more serious than paying a licence fee late. In effect no licence remained in existence after a change of entity as licences were not transferable and a new licence application was required to be made in the name of that new entity, in this case the limited company. We pointed out that this should have been made immediately after the business was incorporated in July 2009, so was already 9 months late. However the Traffic Commissioner had not yet taken any point about this failure but had merely confirmed that a new application must be made instead of there being any question of the automatic determination being reversed or a stay being granted.

5.           Mr Littlewood nevertheless persisted that owing to the termination of the licence much valuable business had been lost due to activity from rival operators. We nevertheless explained to him and his client that it was, clearly, for such a reason that the Traffic Commissioner’s staff had encouraged his client in correspondence to progress a new application as soon as possible, since owing to the automatic termination of the sole trader’s licence the business now had no licence and urgently needed to protect its market by obtaining one. At this stage there would be various points (such as road safety and the fleet report showing compliant systems) which could be submitted in support of the application. However, in the meantime it was clear to us that there was no case for allowing an appeal against the automatic termination of the sole trader’s licence, first because there have been no exceptional circumstances within the meaning of s 52 of the Act and, secondly, because the business is no longer operated by a sole trader but by a limited company. The Traffic Commissioner could not be said to be plainly wrong in declining to reverse the automatic termination of a licence which is technically no longer in existence as it is no longer appropriate to the entity in which the enterprise seeks to operate. Accordingly the appeal is dismissed.

Frances Burton

Judge of the Upper Tribunal

12 May 2010