Neutral Citation Number: [2014] UKUT 381 (AAC)

Appeal No.  T/2014/20

IN THE UPPER TRIBUNAL

ADMINISTRATIVE APPEALS CHAMBER

TRAFFIC COMMISSIONER APPEALS

 

ON APPEAL from the DECISION of Simon Evans Deputy Traffic Commissioner for the North West of England

Dated 4 March 2014

 

 

 

Before:

His Hon Michael Brodrick, Judge of the Upper Tribunal

Leslie Milliken, Member of the Upper Tribunal

David Rawsthorn, Member of the Upper Tribunal

 

 

Appellant:

SEAMUS JOSEPH PATTERSON t/a PATTERSON PLANT

 

 

 

 

Attendances:

For the Appellant: The Appellant did not appear and was not represented.

 

 

Heard at: Field House, 15-25 Bream’s Buildings, London, EC4A 1DZ

Date of hearing: 23 July 2014

Date of decision: 26 August 2014

 

 

 

DECISION OF THE UPPER TRIBUNAL

IT IS HEREBY ORDERED that this appeal be DISMISSED.

 

SUBJECT MATTER:- Termination for non-payment

 

 

CASES REFERRED TO:- Appeal 1998 K 35 Derek Bertram.

T/2013/58 & 75 Patrick Ward t/a Allshires Landscapes & Overbrook Recovery Services Ltd 

 

 

REASONS FOR DECISION

 

 

1.        This is an appeal from the decision of the Deputy Traffic Commissioner for the North West of England to refuse to find that there were exceptional circumstances, which justified him disregarding the automatic termination of the Appellant’s operator’s licence.

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

            (i)           The Appellant is the holder of a standard national goods vehicle operator’s licence authorising two vehicles, with an operating centre at 38 Moss Side Lane, Rixton, Warrington, WA3 6HJ.  This was also the correspondence address provided by the Appellant.

           (ii)           The licence shows that it was in force from 23 February 2004 and that the ‘review date’ was 23 February 2014.

          (iii)           On 20 December 2013 the Office of the Traffic Commissioner, (“OTC”), wrote to the Appellant to inform him that the continuation fee to keep his operator’s licence in force was due to be paid no later than 31 January 2014 and that it would then cover the period until 31 January 2019.  The letter warned that no reminder would be sent and that failure to pay by 31 January 2014 would result in the termination of the licence.

         (iv)           On 11 February 2014 the OTC wrote to the Appellant to inform him that the deadline mentioned in the letter of 20 December 2013 had passed and the continuation fee had not been paid.  The Appellant was advised that his licence had been terminated automatically under the provisions of s. 45(4) of the Goods Vehicles (Licensing of Operators) Act 1995, ["the 1995 Act"], with the result that he no longer had authority to operate any goods vehicles for which an operator’s licence is required.

          (v)           On 13 February 2014 the Appellant wrote to the OTC.  The letter was received on 25 February 2014. The Appellant said that the earliest point at which he was made aware of the expiry of his licence was on receipt of the letter dated 13 February 2014.  He added that he immediately contacted the OTC and was advised to write as soon as possible.  He enclosed a cheque for the continuation fee.

         (vi)           On 25 February 2014 the matter was submitted to the Deputy Traffic Commissioner.  The submission pointed out that the Appellant had not provided any telephone number with his letter nor were any numbers held as part of his licence details.  Under the heading ‘Further Comments’ the Deputy Traffic Commissioner was alerted to the fact that following the changes made by EU Regulations Mr Patterson was removed as the transport manager and that no new transport manager had been notified.  The recommendation was that the licence should not be reinstated because no exceptional circumstances had been put forward.  It was noted that the Appellant used the VOSA, (now ‘DVSA’), on-line self-service system but that he had not chosen to receive documents by email.  The Deputy Traffic Commissioner agreed with the recommendation and concluded that there were no exceptional circumstances in this case.  He added that there were wider issues, which led him to conclude that the Appellant had contributed to his own predicament.  He said that he could not ignore the absence of a transport manager over a long period.

        (vii)           On 4 March 2014 the OTC wrote to the Appellant to inform him that having read his letter the Deputy Traffic Commissioner had directed that the “original decision to terminate your licence in line with the provisions of s. 45(5) of the Act must stand”.  The letter went on to inform the Appellant that he had “statutory right of appeal” to the Tribunal.

       (viii)           On 27 March 2014 Mike Oliver of ‘Trans-Law’ filed a Notice of Appeal on behalf of the Appellant.  The first ground of appeal makes it clear that the appeal is against the original decision to terminate the licence for non-payment of the ‘renewal fee’ and the later direction that that decision must stand.  The second ground of appeal is that no notice, letter or other communication was received by the Appellant concerning review, renewal, expiry or termination of the licence until the letter of 11 February 2014.  The third ground of appeal is that termination was premature because the Appellant tendered the continuation fee before the review date of 23 February 2014.  The fourth ground of appeal is that the refusal to disregard the automatic termination of the licence was flawed because payment had been tendered in time.  The fifth ground of appeal is that the justification for the ‘continuation date’ shown on the Appellant’s file on the VOSA website is unclear.

3.        Before the date of the hearing the Appellant invited the Tribunal to hear and determine the appeal in his absence, which we now do.

4.        The first ground of appeal makes it clear that the appeal is against both the termination of the licence and the decision not to disregard that termination.  We will consider the two parts of this ground separately.

5.        We are quite satisfied that there can never be an appeal against the termination of an operator’s licence under the provisions of s. 45(4) of the 1995 Act.  That sub-section provides that: “If any fee or instalment of a fee in respect of the continuation in force of an operator’s licence is not duly paid by the prescribed time, the licence terminates at that time”.  Termination for non-payment does not involve a decision, in the sense that someone has to make choice between different courses of action.  Instead it is the automatic consequence of failing to pay the continuation fee by the “prescribed time”.  It follows that any suggestion that the operation of s. 45(4) involves a decision that can be appealed is misconceived.  That conclusion is not only justified by the terms of s. 45(4) it is confirmed by the terms of s. 37 of the 1995 Act, which is the section conferring a right of appeal to the Tribunal.  In s. 37(2) & (3) of the 1995 Act the holder of an operator’s licence is given the right to appeal decisions taken under certain specified sections of the 1995 Act.  There is no reference to s. 45(4) in either of these sub-sections.  It follows, in our judgment, that there is no right of appeal against the automatic termination of a licence following non-payment of the continuation fee within the prescribed time.

6.        In our view it is unfortunate that the letter of 4 March 2014, rejecting the request to disregard the automatic termination of the licence refers to: “the original decision to terminate your licence”.  It may be that the Appellant and his advisors were misled by this form of words.  If and when the opportunity arises it would be advisable to re-draft this section of the letter.  This letter went on to state that the Appellant had a “statutory right of appeal” against the decision to refuse to disregard the automatic termination.  This is also incorrect for the reasons given in the next paragraph.  We believe that steps are being or have already been taken to re-draft this paragraph for letters relating to this type of case.

7.        Where an operator’s licence has terminated automatically because the continuation fee has not been paid on time a Traffic Commissioner, by virtue of s.45(5) of the 1995 Act: “may, if he considers there to be exceptional circumstances that justify his doing so in any case where subsection (3) or (4) has applied, direct that as from the time mentioned in that subsection its effect in that case be disregarded”.  In other words Traffic Commissioners have been given discretion to allow an operator’s licence to remain in force if (a) there are exceptional circumstances and (b) those exceptional circumstances justify that course.  There is no statutory right of appeal against a refusal to exercise this discretion because s. 45(5) has not been included in s. 37(2) & (3) of the 1995 Act listing the decisions which can be appealed.  However the long-standing practice of the Tribunal, to the knowledge of the Department of Transport, has been to accept appeals in relation to a refusal to exercise this discretion, see Appeal 1998 K 35 Derek Bertram.

8.        The second ground of appeal is that the Appellant did not receive any notice, letter or other communication concerning review, renewal, expiry or termination of the licence until the letter of 11 February 2014.  This ground of appeal is misconceived.  The Tribunal has repeatedly explained that the 1995 Act and the Regulations made under that Act make no provision for any reminder to be sent to operators before a continuation fee becomes due.  The absence of any such requirement can be contrasted with the terms of s. 27(2) of the 1995 Act, which contains an express requirement to give notice before taking action under that section.  However for the reasons given in appeal T/2013/58 & 75 Patrick Ward t/a Allshires Landscapes & Overbrook Recovery Services Ltd  (see paragraph 13), the Tribunal concluded that Note 1 on an operator’s licence gives rise to a reasonable expectation that a “fee request” will be sent to the correspondence address held on the operator’s file.  We have underlined the word sent because the reasonable expectation goes no further and, in particular, does not mean that the OTC must guarantee that the operator receives the fee request.  The obligation to pay by the prescribed time rests on the operator and it is the responsibility of operators, who wish to avoid automatic termination, to devise a suitable means of reminding themselves of the prescribed time for payment of the continuation fee.

9.        The third ground of appeal is that termination was premature because the Appellant tendered the continuation fee before the review date of 23 February 2014.  This ground of appeal is also misconceived because it confuses the ‘review date’, which relates to the environmental suitability of the operating centre and does appear on an operator’s licence, with the ‘prescribed time’ for payment of the continuation fee, which is defined by Regulations, but is not expressly stated on the licence.  The same misconception occurs in the fifth ground of appeal which is that the justification for the ‘continuation date’ shown on the Appellant’s file on the VOSA website is unclear.  It is convenient to consider these two grounds together.

10.      There is no uncertainty about the meaning of the ‘prescribed time’ for payment.  As the Tribunal explained in paragraph 7 of the Ward & Overbrook decision, (above), the expression ‘prescribed time’ is defined in the Goods Vehicles (Licensing of Operators) (Fees) Regulations 1995.  Part I of the Schedule to those Regulations provides that the continuation fee must be paid: “before the end of the month which precedes the date of expiry of a period of 5 years beginning with the date of either the issuing of the licence or the most recent 5 year anniversary of that date whichever is the later”.  The simplest way in which to approach this definition is to begin by considering the date on which the licence was issued.  The first continuation fee must be paid by the end of the month immediately before the month in which the fifth anniversary of the start of the licence occurs.  Thereafter the continuation fee is payable by the end of the month preceding each 5 year anniversary of the date of issue of the licence.

11.     In our view it is quite clear that the prescribed time is not and never can be the same as the review date.  The review date occurs on every fifth anniversary starting with the date on which the licence is granted.  The prescribed time for payment means that payment must be made before the end of the month that precedes each fifth anniversary starting with the date on which the licence was granted.  Hence in the present case with a review date of 23 February 2014 the prescribed time for payment was before the end of the preceding month, i.e. before the end of January 2014.  Since payment had not been received by 23.59 on 31 January 2014 the licence automatically terminated at that time.  This was made clear in the letter of 11 February 2014.  It follows that suggestions that the Appellant paid within time and that termination was premature are both wrong and bound to fail.  It follows that we reject grounds three and five.

12.      The fourth ground of appeal is that the refusal to disregard the automatic termination of the licence was flawed because payment had been tendered in time.  As drafted this ground is also bound to fail, because, as we have explained, the Appellant and his advisors have confused the review date with the prescribed time for payment.  There is no dispute that the Appellant paid after 2359 on 31 January 2014.  It follows that payment was not made by the prescribed time and that the licence automatically terminated as a result.

13.      Nevertheless we propose to take a wider view of this ground of appeal, in order to consider whether the refusal to disregard the automatic termination of the licence amounted to a flawed exercise of discretion.  In the appeal of Ward & Overbrook, (above) the Tribunal came to the conclusion that there had been confusion between the review date and the payment date, (i.e. the prescribed time for payment).  As a result those appeals were allowed.  We have considered whether there was any scope for similar confusion in the present case.  We are satisfied that there is not and that, on the contrary, there were several ways in which this Appellant could and should be aware of the payment date.

14.      The first is that this Appellant successfully paid the continuation fee, by the prescribed time, when he renewed the licence in 2009.  The renewal request, sent on that occasion, would have stated in a box towards the bottom that the continuation fee: “covers the period until 31/01/14”.  In other words a diary entry, carried forward over the following five years would have alerted the Appellant to the need to pay the next continuation fee before 31 January 2014.

15.      The second is that this Appellant used the operator self-service system set up by VOSA.  As one of the documents included in the appeal file shows the Appellant could, at any time, have ascertained the date by which payment had to be made by accessing this system.

16.      The third way in which the Appellant could have determined the payment date is from the fee request and checklist sent on 20 December 2013, though we accept that this depends on the letter being received and we are aware that this is challenged.

17.      The fourth way is by reference to the operator’ licence discs displayed on the authorised vehicles.  In paragraphs 10 & 14 of the Ward & Overbrook decision, above) the Tribunal questioned the assertion made by the OTC in that case that the licence discs would give the renewal date and stated a belief that it set out the review date.  We are now in a position to state clearly and unequivocally that the date on the vehicle operator’s licence disc is the payment date and is not the review date.  It follows that the assertion made by the OTC and quoted at paragraph 10 in Ward and Overbrook was correct.  Unfortunately the Tribunal, in that case was either misinformed or misunderstood the information it was given.  That limited part of the decision should be disregarded but apart from this point the decision can be and should be relied on.  In our view this means that operators would be well advised, as part of a walk-round check, to look at the date on the operator’s licence discs in their vehicles because it provides a simple and obvious reminder of the payment date.

18.      In our view there were several ways, in addition to the fee reminder letter, by which it would have been open to this Appellant to ascertain the payment date.  The Tribunal has made it clear on many occasions that mere forgetfulness or carelessness, which appears to be the position in this case, does not amount to an exceptional circumstance justifying a Traffic Commissioner disregarding the automatic termination of a licence.  It follows that we reject this ground of appeal.

19.      Since each ground of appeal has been rejected, for the reasons given above, it follows that the appeal must be dismissed, with immediate effect.  The only way in which the Appellant can resume the lawful operation of HGV’s is by making a successful application for a new operator’s licence.  It will be for the Traffic Commissioner to decide, in the course of dealing with any such application, whether or not it is appropriate to grant an interim licence.

Postscript

20.      We propose to add our views on two points that apply to many, if not all, cases arising out of termination for non-payment.

21.      First, in our view it is clear that responsibility for paying the continuation fee, by the prescribed time, falls on operators.  It is also clear that the consequence of non-payment by the prescribed time is the automatic termination of the licence.  The Tribunal has stated on many occasions that non-receipt of the fee request, forgetting to pay or overlooking the need to pay do not amount to exceptional circumstances which justify disregarding automatic termination.  In our view it follows from these propositions that operators would be well advised to devise a reliable means of identifying the prescribed time for payment and then ensuring that they are reminded of the need to pay before that date.  Paragraphs 14, 15 and 17 provide examples of the ways in which this can be done without relying on receipt of the fee request.  Operators should understand that Traffic Commissioners are likely to take these matters into account on any future applications for automatic termination to be disregarded.

22.      Second, the Appellant applied for a stay of the decision to terminate the licence and of the decision to refuse to disregard the consequences of late payment.  In addition he invited the Deputy Traffic Commissioner to review his decision in the light of the matters set out in the grounds of appeal and the application for a stay.

23.      On 8 April 2014 a very full, fair and careful submission was sent to the Deputy Traffic Commissioner.  It commented on each of the points raised by the Notice of Appeal and the application for a stay.

24.      On 14 April 2014 the Deputy Traffic Commissioner gave written reasons for refusing to stay his decision or to conduct a further review of his decision.  His decision runs to five pages in which he carefully considered all the matters raised on behalf of the Appellant.  He refused the application for a stay on the ground that there was no power to grant a stay in the circumstances of this case.  In relation to the application to review the decision the Deputy Traffic Commissioner pointed out that he was not aware of any provision with gave him the power to review his decision.  Nevertheless, out of fairness to the operator, he went on to consider whether, in the light of the material then available to him, there was any obvious error in his original decision.  After a full and careful review of the position he concluded that the application for a review should be refused.

25.      A renewed application for a stay was then made to the Tribunal.  It was refused for two reasons.  The first was that the Tribunal has no jurisdiction to grant a stay in cases where there has been automatic termination for non-payment followed by a refusal to find exceptional circumstances to justify disregarding the termination of the licence.  The second was that it was, in any event, inappropriate to grant a stay where the prospects of success, on the grounds of appeal advanced were: “poor to non-existent”.

26.      In our view the time has come to make it crystal clear that neither Traffic Commissioners nor the Tribunal has any power to grant a stay in cases where an operator’s licence has terminated automatically as a result of failing to pay by the prescribed time.  Nor do Traffic Commissioners or the Tribunal have any power to grant a stay in case where a Traffic Commissioner has refused to find that there are exceptional circumstances, which justify disregarding the automatic termination of the licence.  We repeat what the Tribunal said at paragraph 32 of the Ward and Overbrook decision (above), namely:

“In Appeal 2009/18 Rose & Sons Ltd the Tribunal, having accepted that an appeal lay to the Tribunal, went on to say, (without reference to the 1995 Act) that: “stays should be granted where appropriate”.  More recently in T/2013/84 Michael Steven Reed the Tribunal gave more detailed consideration to the question of whether there was any right to grant a stay in this category of appeal.  First, it pointed out that neither s. 45(4) nor s. 45(5) of the 1995 Act feature in s. 29(2) of the 1995 Act.  That is the sub-section, which sets out the circumstances in which a stay can be granted. Second, it pointed out that the power to grant a stay relates to specific decisions made by Traffic Commissioners not to the automatic termination prescribed by s. 45(4) of the 1995 Act.  Third, it pointed out that the effect of a stay is to prevent a decision coming into effect not to reverse a decision to refuse to make a finding.  In other words where the Traffic Commissioner refuses to disregard the automatic termination of a licence staying that decision would simply mean that the automatic termination remained effective”.

27.      It follows, in our judgment, that the application for a stay in the present case should never have been made nor should it have been renewed to the Tribunal.  Making it resulted in a waste of time and tax-payers money, which ought to have been avoided.

28.      We hope that in future Traffic Commissioners and the Tribunal will not be troubled by applications to stay the automatic termination of operator’s licences under s. 45(4) of the Act or decisions to refuse to find exceptional circumstances justifying the disregard of automatic termination.  If this proves to be a false hope and further applications to stay such decisions are made our view is that it will be appropriate to dismiss them on a summary basis, without consideration of the merits. In our judgment it will only be necessary to state that there is no jurisdiction and to quote paragraph 26 of this decision as authority for this proposition.  We suggest that course because in our view wasting time and money considering the merits of an application, which is bound to fail for want of jurisdiction, ought to be avoided.

29.      Finally we consider that it is right to commend the staff in the OTC who dealt with this matter and the Deputy Traffic Commissioner for the care and attention that they all devoted to this case as well as the obvious fairness with which they handled the case.  It would have been easy for them to have dismissed the case out of hand.  They resisted that temptation and, as a result, they enabled us to include important details, particularly those in paragraphs 14-17 above.

 

 

 

 

Michael Brodrick, Judge of the Upper Tribunal, Principal Judge for Traffic Commissioner Appeals, President of the Transport Tribunal.

26 August 2014