Neutral Citation Number: [2012] UKUT 220(AAC)

Appeal No.  T/2012/14

IN THE UPPER TRIBUNAL

ADMINISTRATIVE APPEALS CHAMBER

TRAFFIC COMMISSIONER APPEALS

 

ON APPEAL from the DECISION of Patrick Mulvenna

DEPUTY TRAFFIC COMMISSIONER for the North Western Traffic Area

Dated 28 February 2012

 

 

 

Before:

H. H. Michael Brodrick, Judge of the Upper Tribunal

Leslie Milliken Member of the Upper Tribunal

Patricia Steel Member of the Upper Tribunal

 

 

Appellant:

ATEC SCAFFOLDING (PRESTON) Ltd.

 

 

 

 

Attendances:

For the Appellant: Jeremy Fear, Solicitor

 

 

Heard at: Victory House, 30-34 Kingsway, London

Date of hearing: 19 June 2012

Date of decision: 28 June 2012

 

 

 

 

DECISION OF THE UPPER TRIBUNAL

IT IS HEREBY ORDERED that this appeal be ALLOWED.  The application is remitted for re-consideration by the Traffic Commissioner.

 

 

 

 

 

 

 

 

 

SUBJECT MATTER:- Procedure, proceeding in absence of Applicant.

 

 

CASES REFERRED TO:- None

 

 

REASONS FOR DECISION

 

1.           This is an appeal from the decision of the Deputy Traffic Commissioner for the North Western Traffic Area to refuse the Appellant’s application for a restricted goods vehicle operator’s licence.

2.          The factual background to this appeal appears from the documents and the Traffic Commissioner’s decision and is as follows:-

(i)                   On 18 July 2011 the Appellant applied for a restricted goods vehicle operators licence authorising four vehicles, with an operating centre at Unit 5 Enterprise Way, Burn Hall Industrial Estate, Fleetwood.

(ii)                 On 8 August 2011 the Office of the Traffic Commissioner, (“OTC”), wrote to the Appellant inviting him to provide financial evidence and a written maintenance contract by 22 August 2011.

(iii)                On 30 August 2011 the OTC sought further information, by 13 September 2011, asking the Appellant to ‘clarify, in writing, your links to Martin McHugh and Premier Scaffolding Ltd’.

(iv)                On 4 September 2011 the Appellant replied.  Given its importance we quote the reply in full:

“My connection with Mr McHugh and his company is this, I trained as a basic scaffolder with Mr McHugh’s company from leaving school but moved on to work for a national company called McCrory’s based in Peterborough and became an advanced scaffolder and supervisor for them.

Me and Mr McHugh has always stayed in touch and recently he has indicated that he wants to sell the ‘Kwik Stages’ side of his business (this is system scaffold) but retain and expand the ‘tube and fitting’ side.

He has offered me the opportunity to purchase the scaffold and vehicles over time whilst he purchases new wagons and equipment.

Scaffolding is a very capital intense business to start up and this opportunity allows me a good start.  I have given my notice to my employer and hope to be operating by mid September”.

(v)                 On 9 September 2011 the OTC notified the Appellant that his application for an interim licence had been refused.

(vi)                On 27 September 2011 the Traffic Commissioner informed the Appellant that he had decided to determine the application at a Public Inquiry, which was to be held on 3 November 2011.  The concerns which led to this decision related to the Appellant’s fitness to hold a licence, to the facilities and arrangements for maintaining the vehicles and to the question of financial resources.

(vii)              On 31 October 2011, (a Monday) the OTC wrote to the Appellant to inform him that the Public Inquiry which was due to be heard on 3 November 2011, (a Thursday) was being adjourned.

(viii)             On 19 December 2011 the OTC wrote to the Appellant to inform him that the new date for the adjourned Public Inquiry was to be 1^st February 2011.  This letter, together with all the others to which we have referred was sent to the operating centre address (paragraph 2(i) above), which was the correspondence address given on the application.

(ix)                On 27 January 2012 the OTC wrote to the Appellant, at the same address to inform him that the Public Inquiry had, again, been adjourned from 1 February 2012, this time to 28 February 2012.

(x)                 On 28 January 2012 the Appellant wrote to the OTC.  The letter was on ATEC notepaper giving the operating centre address and telephone numbers, including a mobile phone number.  It was received by the OTC on 31 January 2012, so the letters crossed in the post.  We quote significant parts of this letter, in particular because of the careful explanation which the Appellant gave for being unable to attend the Public Inquiry on 1 February 2012:-

“Unfortunately I will not be able to attend the Public Inquiry on 1 February 2012 as I am still working for McCrory’s Scaffolding and am running a large contract on a renewable energy site in Scotland which requires me to be on site Monday to Saturday on 7.00 am to 6.00 pm shifts and to be on standby most Sunday’s.

Because we are in the far north east of Scotland I took 3 day’s leave to come to the enquiry on the 03/11/2011 only to find it cancelled at the last minute.  …

The opportunity that I had in September to purchase equipment from Mr McHugh has now passed but I still intend to start trading once everything is in place and I have secured a couple of contracts.

My only connection to Mr McHugh and his companies is that I bought this registered limited company off him and took over the email and web address.

I have no adverse history that would prevent me and my company from holding a licence, I have the funds available in the company’s account and an inspection contract with Simmons DAF in place and will attend a ‘new operator’s seminar’ once my licence is granted”.

(xi)                The Public Inquiry finally took place on 28 February 2012 before the Deputy Traffic Commissioner.  Two other companies had been called to the same Public Inquiry.  One, Premier Scaffolding t/a Apex Scaffolders Ltd, (“Premier”), was applying for a new licence while the other, Apex Scaffolding (North West) Ltd, (“Apex”), had been called to the Public Inquiry on disciplinary grounds.   The link was that Martin McHugh was a director of both these companies.  The Appellant was not present or represented at this Public Inquiry. The two companies with which Mr McHugh was concerned were represented by Mr Culpin.

(xii)               One of the first things to emerge during a brief hearing was that the hearing on 1 February 2012 was adjourned to suit the convenience of Mr Culpin, who was involved in another Public Inquiry on the same date.

(xiii)             The Deputy Traffic Commissioner decided to deal with the Appellant’s application first.  He said this:-

“I am satisfied that they have been given adequate notice of a time and place of hearing and I propose to deal with the issues in their absence.  It might be that Mr McHugh can help me to look at the background”.

(xiv)             Mr McHugh then gave evidence.  He confirmed what the Appellant had said in relation to the original proposal to take on the System scaffolding side of the business with which Mr McHugh was concerned.  He also confirmed that that proposal had come to nothing.  He said that while the Appellant had an operating centre on the same estate the two businesses were not sharing an operating centre.

(xv)              The Deputy Traffic Commissioner then turned to the matters concerning the two companies with which Mr McHugh was involved.  He was satisfied that the application for a new licence by Premier met the statutory requirements and granted the application.  He accepted a surrender of the licence held by Apex.  It appears that the company was dissolved, probably in error, and that it had not proved possible to re-instate it.

(xvi)             Finally the Deputy Traffic Commissioner indicated that he would deal with the Appellant’s application in chambers.

(xvii)            On 29 February 2012 the OTC wrote to the Appellant to inform him that the application had been refused.  The reasons given by the Deputy Traffic Commissioner were as follows:

“I am satisfied that adequate notice has been given to the applicant, of the time and place of the hearing.  The applicant is not present and no excuse has been offered for absence.  I have decided, therefore, to determine the application in the applicant’s absence.

There are unanswered questions as to compliance with the statutory requirements for the grant of a licence.  In these circumstances, the application is refused”.

(xviii)          On 4 April 2012 Mr Brook, the sole director of the Appellant company filed a Notice of Appeal against this decision.  He applied for an extension of time in which to appeal, on the ground that due to the nature of his job the first opportunity to check and respond to his post, after the date of the Public Inquiry, was 23 March 2012, on which date he wrote to explain the position to the Tribunal.  An extension of time was granted.

(xix)             In his grounds of appeal Mr Brook said that the Appellant company had not traded before, so it had no adverse history and that he had never been the director of a company before and he too had no adverse history.  He repeated the explanation which we have quoted in relation to the Public Inquiry which was due to have been heard on 3 November 2011 adding that he received the letter of 31 October 2011 on 2 November 2011.  He referred to the fact that the OTC seemed to be determined to tie his application to the affairs of Mr McHugh whereas, in his view, it should have been determined on its own merits.

 

3.           Mr Brook attended the hearing of the appeal and the Appellant company was represented by Mr Fear. Mr Fear provided us, in advance with a skeleton argument, for which we are grateful.

4.           Mr Fear submitted first, that the Appellant should never have been called to a Public Inquiry in the first place and second, that it seems highly unlikely that the Deputy Traffic Commissioner was given the letter of 28 February 2012 because, if he had seen it he would not have dismissed the application in the way in which he did.  He invited the Tribunal to make it’s own decision, rather than remitting the matter.

5.           We are quite satisfied, for a number of reasons, that the Appellant has not been well-served by ‘the system’.  We use that expression because on the information before us it is not always possible to know what happened or who was responsible for what has gone wrong.

6.           The reason for insisting on a combined hearing of the Appellant’s application, the application by Premier and the disciplinary hearing for Apex is not expressly stated anywhere in the papers.  It seems to us that the concern probably relates to the fact that Mr McHugh is shown as a director of the Appellant from 13 January 2009 to 31 March 2011, when he resigned.  Mr Brook became a director on the same day.  At some stage before 14 September 2011 the OTC became aware that Apex had been dissolved.  We assume that it must have been this information, perhaps coupled with the fact that the Appellant’s operating centre had a similar address to Apex’s operating centre, which led to the letter of 30 August, (paragraph 2(iii) above), which was answered fully and promptly by Mr Brook.  As a result of the information about Apex, it would appear, that that company was called to a Public Inquiry, which was held before a different Deputy Traffic Commissioner, who was told that the company had been dissolved in error and that steps were being taken to try to sort the matter out.  That Deputy Traffic Commissioner suggested that she would be minded to grant an interim licence, if a fresh application was made.  Hence, no doubt, the application by Premier.  She adjourned this Public Inquiry, which then came before the Deputy Traffic Commissioner on 28 February 2012.

7.           We can understand that there may have been concern, initially, that the Appellant company was part of a ‘Phoenix’ operation, in other words a situation where a company with substantial debts goes into liquidation to avoid paying them and those concerned then put the assets into a new company or companies which, effectively, carry on the same business.  At the moment, because nobody ever spelt out the concern expressly, we cannot think of any other cause for concern about the Appellant.  If we are right we do not understand why it remained necessary to insist that the Public Inquiry into the Appellant’s application should be considered at the same hearing as the matters concerning Apex and Premier.  It seems to us that it is improbable that a DTC would indicate that an interim licence would be granted to a company with which Mr McHugh was concerned if there was any lingering suspicion that he was involved in a Phoenix operation or that there was any other ground on which to question his good repute.  Once that position had been reached the matter should have been put before the Traffic Commissioner so that a judicial decision could be taken as to whether or not a joint Public Inquiry was still necessary.  In the event the application by Premier was granted in a Public Inquiry which lasted 13 minutes at which it was accepted, without question, that Mr McHugh was of good repute.

8.           It seems to us that it would be wise for the Traffic Commissioner to investigate what happened in this case to see whether there are lessons to learn about the way in which decisions are taken to hold a Public Inquiry, which more than one operator or applicant is required to attend.  In particular we consider that it would be sensible to record in writing the reason for having a joint inquiry.  In addition we consider that it is essential that all members of staff involved are made aware of their responsibility to draw to the Traffic Commissioner’s attention any material which might alter the decision to hold a joint Public Inquiry.  In our view had that been done in the present case there is a real possibility that much of what followed would have been avoided.  However in view of the uncertainty as to whether or not our assumptions are correct we do not feel able to accept the first point made by Mr Fear, (see paragraph 4 above).

9.           The Public Inquiry was then adjourned at short notice.  We do not know why but we all know from experience that sometimes late adjournments, however undesirable, cannot be avoided.  We now know that it caused Mr Brook significant inconvenience because he had arranged to take three days leave in order to attend only to learn the day before that the Public Inquiry was not going to take place.  Unfortunately he did not make this point at the time.  We are aware that requiring the OTC to arrange every Public Inquiry for the convenience of the parties would impose an impossible burden.  But there are some occasions when it is desirable for the OTC to take steps to ensure that the date for a Public Inquiry is convenient.  It seems to us that if the OTC imposes the inconvenience of a late adjournment on the parties it is a small price for them to pay to take the trouble to arrange a date for the adjourned Public Inquiry, which is convenient to the parties.  That is not what happened here, though we accept that significant notice was given.  However it was all to no effect because, once again, the Public Inquiry was adjourned at the last moment.  On this occasion Mr Brook only became aware of the delay the day before the Public Inquiry was due to take place.  It appears to have been done to suit the convenience of Mr Culpin, yet there is no evidence of any consideration being given to the convenience of Mr Brook.  His contact details, including a mobile phone number, are set out on the application and on the letter of 28 January 2012, which the OTC received on 31 January 2012.

10.        In our view the failure to make any attempt to contact Mr Brook, to see whether the new date for the Public Inquiry would be suitable to him was inexcusable in the context of two adjournments at very short notice.  We are quite satisfied that the way in which he was treated was unfair when contrasted with the immediate granting of an adjournment to suit the convenience of Mr Culpin.  The unfairness is, of course, compounded by the fact that, by this stage, it is questionable whether there was any need for a joint Public Inquiry.

11.        But the matter does not end there.  In his letter of 28 January 2012, (paragraph 2(x) above) Mr Brook gave a full, careful and convincing explanation as to why he was unable to attend the hearing on 1 February 2012.  By the time the letter had arrived that hearing had been adjourned but it seems to us that anyone who gave this letter a moment’s thought would have realised that exactly the same problem would be likely to apply to the hearing on 28 February 2012.  We do not know whether the letter was put before the Deputy Traffic Commissioner on or before 28 February 2012.  We assume that the answer is that it was not.  We say that because one of the reasons given for refusing the application was that: “no excuse has been offered for absence”.  We cannot believe that the Deputy Traffic Commissioner would have said this having read the letter of 28 January 2012, but if we are mistaken such a comment would have been plainly wrong.  We think that it is much more likely that he never saw the letter because it was never included in his papers.  If that is the case then we want to make it clear that this was a serious mistake, which has probably resulted in unfairness to the Appellant.  Again it seems to us that it would be wise to find out what happened to avoid any repetition in the future.  It is the responsibility of the OTC to ensure that those who conduct Public Inquiries have all the relevant information so that fair and fully informed decisions can be reached.

12.        Our final concern relates to another aspect of the Deputy Traffic Commissioner’s reasons for refusing the application.  He said that: “there are unanswered questions as to compliance with the statutory requirements for the grant of a licence”.  He did not go on to state what they were.  It appears that the Appellant had provided all the material which the OTC had requested, so this does not seem to be a case in which the Appellant had failed to provide anything which it had been requested to provide.  As we have indicated it would appear that any initial concerns about a link to Mr McHugh should have been allayed by the fact that his company, Premier, was granted a licence.

13.        For whatever reason, and we stress that it may be through no fault on the part of the Deputy Traffic Commissioner, we are satisfied that this application should not have been dealt with in such a cavalier fashion.  As a result we do not believe that the Appellant has been fairly treated or that the refusal of the application can be allowed to stand.

14.        We were urged by Mr Fear not merely to allow the appeal but to re-determine the application and grant it.  Much as we would have liked to bring this matter to a speedy conclusion we do not believe that we ought to grant the application at this stage.  There are two reasons.  First, as we had indicated, we have had to make assumptions about the concerns to which the Deputy Traffic Commissioner referred.  On the information available we cannot tell whether or not those assumptions are correct so it seems to us that the Traffic Commissioner should have an opportunity to consider the matter afresh.  Second, a considerable time has elapsed since the application and the Appellant’s response to the questions raised by the OTC.  In our view the matter should be determined on the basis of up to date evidence.

15.        For these reasons we allow the appeal and direct that the application is remitted to be reconsidered by the Traffic Commissioner.  The Appellant should provide the OTC with up to date evidence in relation to its finances and should respond to any other questions which the OTC poses.  Given what has happened and given the delay we hope that the whole process can be considered as a matter of urgency, though whether or not it requires a further Public Inquiry will be a matter for the Traffic Commissioner to decide.

 

 

 

His Hon. Michael Brodrick, Judge of the Upper Tribunal,

Principal Judge for Traffic Commissioner Appeals.

28 June 2012