TRAFFIC COMMISSIONER APPEALS
ON APPEAL from the DECISION of
Nick Denton, Traffic Commissioner for the
London and South East of England Traffic Area dated 30 April 2014
Before:
Her Honour Judge J Beech, Judge of the Upper Tribunal
Stuart James, Member of the Upper Tribunal
John Robinson, Member of the Upper Tribunal
Appellants:
ADAM NIENALTOWSKI &
FIFTH ZONE LIMITED
Attendances:
For the Appellants: Simon Newman of NA Commercial Solicitors
Heard at: Field House, 15-25 Bream’s Buildings, London, EC4A 1DZ
Date of hearing: 19 August 2014
Date of decision: 1 September 2014
DECISION OF THE UPPER TRIBUNAL
IT IS HEREBY ORDERED that the appeals be DISMISSED and that the orders of revocation and disqualification take effect at 23.59 on 28 September 2014
SUBJECT MATTER:- Fulfilling undertakings; good repute; professional competence; revocation and disqualification.
CASES REFERRED TO:- Bradley Fold Travel Ltd & Peter Wright v Secretary of State for Transport (2010) EWCA Civ 695; Thomas Muir (Haulage) Limited v The Secretary of State for the Environment, Transport and the Regions (1998) Scots CS 13; T/2009/225 Priority Freight Limited; 2002/217Bryan Haulage No.2.
1. This was an appeal from the decision of the Traffic Commissioner (“TC”) for the London & South East of England Traffic Area made on 30 April 2014 when he revoked the standard international operator’s licence held by Fifth Zone Ltd (“the company”) under s.26(1)(c)(iii) & (f) and s.27(1)(a) & (b) of the Goods Vehicles (Licensing of Operators) Act 1995 (“the Act”) and found that Adam Nienaltowski (“Mr AN”) had lost his good repute and his professional competence as a Transport Manager pursuant to paragraph 13 of Schedule 3 of the Act and disqualified him from acting as a Transport Manager for a period of twelve months. These orders were to take effect on 0001 hours on 1 June 2014.
2. The factual background appears from the documents and the Traffic Commissioner’s written decision and is as follows:
(i) The company was granted a standard international operator’s licence on 21 December 2011 authorising one vehicle and one trailer. The company had one vehicle in possession and its sole Director and Transport Manager was Mr AN. Andrezey Zarnowski was the driver of the vehicle.
(ii) On 17 September 2012, the vehicle attracted a delayed PG9 for damage to the obligatory spray suppression equipment on the nearside and offside of axle 2.
(iii) On 31 October 2013, the MOT certificate on the vehicle expired. It was not presented for a test until 25 November 2013, which it then failed. Between 31 October and the date of the test, the vehicle had travelled 8214km.
(iv) On 16 December 2013, the vehicle was stopped and it was noted that the vehicle was being operated without a valid MOT certificate. The trailer (C031106) attracted a delayed PG9 for damage to wheel wings and missing spray suppression equipment.
(v) The vehicle was re-presented for its MOT test on 18 December 2013. The test had to be abandoned because of a fuel tank problem. Between the previous test (25 November 2013) and the abandoned test, the vehicle had travelled 7794km.
(vi) The vehicle was presented for a further retest on 24 December 2013 which it and same the trailer failed. The vehicle was re-submitted on 8 January 2014 and passed. However, between 18 December and 8 January 2014, the vehicle had travelled a further 707km. It follows that in the period of just over two months during which the vehicle had been operated without a valid MOT certificate, it had travelled a total of 16,715km.
(vii) Traffic Examiner (“TE”) Dowling visited Mr AN on 28 January 2013. Mr AN stated that he thought that he could continue to use the vehicle without an MOT certificate provided the items identified at the failed test had been repaired and a new test had been booked. TE Dowling undertook an operator assessment and found that Mr AN did not have any system in place for downloading data from the driver’s digital tachograph card or from the vehicle’s tachograph data unit. Further, there was no software available to analyse the data had it been downloaded. TE Dowling informed Mr AN that he must write to the Office of the Traffic Commissioner (“OTC”) within fourteen days, explaining the company’s shortcomings and setting out the steps taken or proposed to be taken to address them. No explanation was received from Mr AN by the OTC.
(viii) On 27 February 2014, the trailer (C031106) attracted a delayed prohibition for a damaged brake pipe and for a kink in a brake hose.
(ix) By a letter dated 20 March 2014, the company was called to a public inquiry which took place on 24 April 2014. Mr AN attended and he and the company were represented by Simon Newman, solicitor.
(x) TE Dowling appeared on behalf of DVSA and accepted that when undertaking his operator assessment on 28 January 2014, he had made a mistake in recording his scoring of the company’s monitoring systems for drivers’ hours and record keeping. He had in fact given the company the highest score (“1”) when they should have been either “2” or “3”. He had however advised Mr AN in accordance with the “CPC route” and the systems and analysis that was required along with procedures for such matters as keeping a record of MOT dates, driving licence checks and overloading. TE Dowling was of the view that Mr AN had not listened to the advice he had been given during the investigation as a further PG9 had been issued since his visit. TE Dowling accepted that Mr AN was co-operative and frank during the visit. He further accepted that Mr AN had been interviewed under caution about the vehicle being used without an MOT and not about the company’s failings in relation to drivers’ hours and monitoring.
(xi) Prior to Mr AN giving evidence, Mr Newman made an opening statement on behalf of the company. He stated that Mr AN had migrated to the UK in 2005 and had worked as a bus driver. Following the grant of the company’s licence, Mr AN had used a Transport Manager called Sylvia from MSL Transport. Mr AN would download tachograph data from the driver’s card twice a week and he would download the data from the vehicle’s unit once a month. He would then email the data to the Transport Manager who would analyse it. But then Mr AN passed the Polish Transport Manager CPC examination in May 2013 and the arrangement with Sylvia came to an end. Her fee of £350 per month did not represent value for money. The difficulty was that the company did not possess the necessary software to analyse the data and as a result of the loss of the company’s main contract, Mr AN’s intention to purchase software was delayed. He focussed on finding new business and had been successful. It had been his intention to attend Truckfest in May 2014 (and produced the booking receipt) where he hoped to buy the necessary software. In the interim, Mr AN had engaged the services of the Road Haulage Association (“RHA”) to analyse the data. Mr Newman informed the TC that this arrangement had been put in place shortly after TE Dowling’s visit in January, but when questioned further by the TC, Mr Newman conceded that it had in fact been arranged on 12 April 2014.
(xii) Mr Newman submitted that upon receipt of analysis from the RHA, Mr AN intended to speak to his driver and he would put systems in place, including a requirement that the driver provide a written explanation for the infringements, along with a procedure to warn the driver about future conduct.
(xiii) Mr AN was then questioned by the TC. He stated that he had bought a downloading device and had all of the tachograph data from the vehicle. He had not purchased the necessary software to analyse the data because when he had looked at software available, his English had not been good enough to understand it. He decided to buy it “next time” but was always looking for the right software. He agreed that the CPC course covered the use of digital tacohgraphs but he had the information from his own trusted driver who endorsed the daily driver defect reports with his driving and work times. Mr AN considered that this system was sufficient for a short time. The TC took Mr AN to the driver defect reports which he had produced on the day of the hearing, covering the period between 1 November 2013 and 4 April 2014. Mr AN accepted that he had not identified any drivers’ hours infringements from the driver’s recordings on the back of the reports. The TC took him to the record made on 27 January 2014 which showed that the driver had driven for 10.24 hours. Mr AN thought that perhaps there might have been an accident on that day although the driver had not made a note of it. He was taken to another report dated 12 February 2014 which appeared to show that the driver had driven for 7 hours 48 minutes without taking a qualifying break and that he had not taken his minimum daily rest. A similar record had been made on 14 February 2014. Mr AN said that he tried to check everything. However, sometimes he had a lot to do but he had spoken to the driver in the week prior to the hearing and the driver had promised to do more and Mr AN said that he would check himself. Mr AN denied that he was scheduling the driver to do too much. He would solve the problem as soon as possible and work with the driver to ensure that there were no further infringements. Mr AN produced the RHA analysis for the period 1 November 2013 to 31 March 2014 which revealed numerous drivers’ hours infringements such as failures to take a minimum daily rest and driving over ten hours.
(xiv) As for the use of the vehicle without an MOT certificate, Mr AN said he had tried to book an MOT test one month prior to the expiry of the certificate (31 October 2013) and when looking on the DVSA website, found the earliest available test was 25 November 2013. Mr AN was unaware that there were private testing stations which could also be used. He accepted that the vehicle had failed the test in November; that a test had to be abandoned on 18 December and that the vehicle had failed another test on 24 December 2013. When asked whether he had read the back of any of the inspection notices given to him when the vehicle failed the test and in particular, the warning against using a vehicle out of test, Mr AN did not respond. He said that he had immediately fixed everything that had been identified during the MOT tests so as to avoid the vehicle being taken off the road. He did not know the law and was unaware of the list of the most serious infringements (of which operating a vehicle without an MOT test is one) contained in Regulation (EC) No 1071/2009. He checked the brakes and knew everything about the vehicle.
(xv) Mr AN was asked to consider the driver defect reports which he had produced of which there were more than one hundred in number. The driver had not recorded any defects on those reports. Mr AN’s explanation for the “nil” reporting was that he was checking the vehicle all of the time. He was asked about an advisory notice for “no stop light” issued on 27 February 2013, 22kms into the driver’s working day. Mr AN stated that the reason why the defect report for that day was “nil” was because there was nothing wrong with the vehicle when it was initially checked by the driver. The TC then noted numerous defects recorded in the PMI records which had not previously been identified by the driver (the PMI sheets were not within the appeal papers). Mr AN’s response was that if he found a problem with the vehicle, he fixed it.
(xvi) As for the PG9 issued on 16 December 2013, Mr AN could not explain why the driver had not identified the insecure wings on his defect report that morning. The driver had in fact caused the damage. As for the PG9 on 27 February 2014, the driver had said that the prohibition should not have been issued but Mr AN changed the pipe anyway.
(xvii) In his closing submissions, Mr Newman noted that the company’s vehicle had not attracted any “S” marked PG9’s. Whilst using a vehicle without an MOT certificate was a serious failing, the situation had not been totally ignored by Mr AN. He realised the serious nature of his failings and had taken legal advice and had listened at the hearing. The positives were that the building blocks were in place for satisfactory systems; up to April 2013, tachograph analysis had taken place; whilst there was a significant period when no analysis was taking place, there was a system now; the infringements identified by the RHA would be dealt with by Mr AN; PMI’s were taking place at regular intervals and there was a driver defect reporting system, although Mr AN had been advised about that; the driver also recorded the hours he worked and if that system worked, then it represented a “belt and braces” approach. Mr Newman accepted that the system of the driver manually recording his hours had not had worked as it should. Mr AN had co-operated with TE Dowling and had taken advice during his visit (it was at this stage that TE Dowling expressed the view that Mr AN had not in fact listened to the advice he had been given).
(xviii) In response to the TC’s questions, Mr Newman advised that he had been instructed by Mr AN on 4 April 2014 and that at that stage, Mr AN had been advised of the need to acquire tachograph software. When asked whether TE Dowling had given the same advice in January 2014, Mr AN stated that he had told TE Dowling that he was intending to purchase software at Truckfest in May and TE Dowling had said that such action was “good enough”. TE Dowling interceded and denied that he had given such advice, which would have been illegal and in any event Truckfest was not the place to purchase suitable software. Mr AN then stated that he was in fact looking for software that would help him manage all aspects of the business including drivers hours and maintenance.
(xix) In concluding his submissions, Mr Newman submitted that with one vehicle, there was no room for curtailment and any regulatory action other than a very short period of suspension would end the company’s business. The public inquiry had been a great shock to Mr AN and the TC could have confidence in him. The removal of Mr AN’s repute would be disproportionate.
(xx) In his written decision, the TC found that the company had incurred prohibitions and that s.26(1)(c)(iii) of the Act was engaged. He further found that the company had failed to fulfil its undertaking to ensure that drivers’ hours and tachograph rules would be observed and that s.26(1)(f) of the Act was engaged. Between May 2013 and April 2014, no analysis of tachograph data had taken place even if it had been downloaded. The RHA’s analysis showed regular breaches of the drivers’ hours rules and the TC then gave examples of the infringements identified. The TC noted that even upon his own analysis of the information recorded on the driver defect reports, numerous breaches of the drivers’ hours rules were evident. The company had failed to identify those breaches or take follow up action. The TC was satisfied that the company had breached its undertaking to keep vehicles fit and serviceable, not only by reason of the prohibitions but also the company’s poor MOT pass rate and the evident use of a vehicle in an unroadworthy state. It was clear that there had been substantial commercial use of the vehicle throughout the time that it had been used without a valid MOT certificate.
(xxi) In undertaking the necessary balancing exercise, the TC considered the following negative features:- Firstly, the failure to analyse tachograph data for eleven months along with a failure to take steps to put matters right until shortly before the public inquiry taking place. Secondly, as a result, frequent and significant breaches of the driver’s hours rules had not been picked up and addressed in a timely fashion. Thirdly, the vehicle had been driven for almost 17,000km over a two month period without a valid MOT when Mr AN knew that to be the case. His explanations were “extremely worrying” and even if genuine, they betrayed a lack of knowledge of the basic rules which was “extraordinary” in a qualified Transport Manager. His lack of knowledge of the existence of alternative test centres to the VOSA test station was also of concern and was not an adequate excuse. Finally, the fact that between 1 November and 31 March 2014, the driver had failed to report any defect on the vehicle when four PG9’s had been issued and the vehicle had failed to pass an MOT test on two occasions (although the Tribunal notes that it was in fact three occasions). The strong implication was that the driver consistently failed to carry out effective checks of the vehicle and the operator had not identified that failure.
(xxii) On the positive side, the TC identified the following. Firstly, the RHA had been engaged to undertake tachograph anaylsis, albeit in the two weeks prior to the hearing. Secondly, none of the PG9’s issued were “S” marked. Thirdly, driver defect reports were frequently completed and often more than once a day but the positive was tinged with the negative finding that the checks were not rigorous enough. Finally, Mr AN intended to “do better” in future. After the public inquiry, the TC was provided with booking confirmation that Mr AN was to attend a one day operator licence management course.
(xxiii) The TC concluded that the positive features were substantially outweighed by the nature and gravity of the negative features which had given rise to road safety risks and had constituted unfair competition against those operators who were compliant with drivers hours rules and the use of vehicles with valid MOT certificates. The TC placed particular weight on the use of the vehicle in the knowledge that it did not have a valid MOT certificate and the failure to analyse tachograph data. The TC concluded that he could have little confidence in the operator complying in the future (the “Priority Freight” question). Mr AN had failed to provide the OTC with an explanation for operational shortcomings when requested to do so; he failed to take action to analyse tachograph data following TE Dowling’s visit (the TC rejecting the suggestion that TE Dowling had agreed that Mr AN could wait until May 2014 to rectify the position); he had continued to operate a vehicle without an MOT when it clearly stated on the failure notices that the vehicle could not be used until it had passed an MOT and his action to rectify the tachograph analysis position was far too late. The “Priority Freight” question was answered in the negative. The TC then determined that the neglect of the core compliance responsibilities over such a prolonged period of time, even after opportunities had presented to put matters right, justified the revocation of the operator’s licence and the cessation of the company’s business.
(xxiv) The TC determined that the balancing exercise which had been undertaken in respect of the company was equally applicable to Mr AN as Transport Manager. The failures were substantial and the proportionate conclusion was that Mr AN was no longer of good repute or professionally competent. He further determined that a period of twelve months disqualification was appropriate to give Mr AN sufficient time to reflect on what had gone wrong, to familiarise himself with what the regulatory regime expects of operators and Transport Managers in the UK, to undergo formal refresher training and to resolve “to attach more respect to the rules governing the safe operation of vehicles if ever he is to act as a Transport Manager in the future”.
3. At the hearing of this appeal, Mr Newman appeared on behalf of the company and submitted a skeleton argument for which we were grateful. His first point was that there was insufficient evidence upon which the TC could have concluded that there had been “frequent and significant breaches of the drivers’ hours rules” and that the “strong implication is that the driver consistently failed to carry out effective checks of the vehicle”. In relation to tachograph data analysis, Mr Newman submitted that Mr AN had been open about not possessing the software in order to analyse the tachograph data. However, such software was not obligatory, there being no statutory requirement to possess or use software. The regulations simply require an operator to download the data. Mr Newman referred to page 40 of the DVSA Guidance on Rules on Drivers’ Hours and Tachographs and submitted that in the absence of any reference to the use of software, the extent of the duty was to “make regular checks of charts and digital data to ensure compliance”. Mr Newman also referred to the relevant undertaking when applying for a licence which read “The rules on drivers’ hours and tachographs are observed, proper records are kept and that there are made available on request”. He also referred the Tribunal to the responsibilities of a Transport Manager set out in the TM1 form which did not mention the requirement to use software to analyse drivers’ hours. Mr Newman accepted that it was implicit that analysis of drivers’ hours was required and he agreed that Mr AN was aware of that responsibility. The thrust of his submission was that the required analysis was not limited to the use of software. In Mr AN’s case, he had established a system whereby the driver manually recorded this hours of driving, other work and rest. The difficulty was that he was not analysing that information either.
4. We see nothing in this point. Every “in scope” vehicle is required to have fitted to it, a functioning tachograph, whether analogue or digital (Regulation (EC) 3821/85 (as amended)). There is a requirement to analyse the information produced by the tachograph equipment. In the case of digital tachographs, the only way in which that can be done effectively is by the use of appropriate software. Not only did Mr AN not have that software but he did not make arrangements for external analysis to take place by those who had it. To suggest that a system of manual recording by a driver is sufficient in the absence of software and / or external analysis is to ignore the law.
5. Mr Newman’s next point concerned TE Dowling’s operator’s report dated 28 January 2014 in which TE Dowling had mistakenly recorded his assessment of the company’s systems for monitoring drivers’ hours as “1”. In fact the only assessment of the company’s systems which was not recorded as “1” was that relating to MOT’s which was recorded as “3”. This report had been given to Mr AN. The reason why Mr AN did not respond to that report as he was required to by TE Dowling was because the assessment overall was satisfactory and in respect of the MOT position, he had been interviewed under caution.
6. The Tribunal rejects the suggestion that the mistaken record of TE Dowling’s findings could justify a failure to provide relevant information to either TE Dowling or the OTC. TE Dowling’s evidence was that he had made it clear that the company was required to obtain the necessary software in order to analyse the digital data; whilst the assessment was mistakenly recorded, TE Dowling’s comments at the end of the report read “During the visit the company failed to have a system in place to download digital tachograph vehicle data from the vehicle and drivers cards to the company’s computer system”; the follow up letter sent by TE Dowling to Mr AN repeated this finding and advised him that the Operator Compliance Risk Score was “Red 10”. As a recently qualified Transport Manager, Mr AN should have been alive to the serious implications of both TE Dowling’s findings and the risk score and should have been aware of the need to write to the OTC to explain the shortcomings of the company’s systems and the steps being taken to address them, including the acquisition of analysis software.
7. Turning then to the TC’s findings that there had been “frequent and significant breaches of the drivers’ hours rules”, Mr Newman submitted that the TC was precluded from making such a finding as TE Dowling had not undertaken any investigation into drivers’ hours. The TC’s conclusion had been based upon his own analysis of the manual records completed by the driver which were inaccurate as it would seem that the driver had rounded up the figures to the nearest five or ten minutes (which we observed meant that the manual records were largely meaningless and could not be used by the company to show that there was an adequate system in place for analysis in the absence of software). The TC also relied upon the RHA analysis which was also an insufficient basis even though the analysis was very likely to be accurate. Had there been a DVSA investigation into drivers’ hours, it would have been multi-layered. Mr Newman conceded that he could not object to the use of the word “frequent” to describe the infringements identified by the RHA but he did object to the use of the word “significant”. Finally on this point Mr Newman asserted that the call up letter made no mention of drivers’ hours and analysis.
8. We are satisfied that there is nothing in this point. The reasons for calling the company and Mr AN to the public inquiry were vehicle roadworthiness and that at the date of TE Dowling’s investigation, Mr AN was neither downloading tachograph data or analysing it. At the public inquiry, reliance was placed on his “belt and braces” approach by having the necessary drivers’ hours information recorded by the driver, which Mr Newman now accepts was inaccurate. In any event, no attempt had been made to even analyse that data. The examples raised by the TC during the hearing, even when taking into account the likelihood of the driver “rounding up” timings, demonstrate serious drivers’ hours infringements. The RHA analysis revealed incidents of failing to have sufficient daily rest; driving without taking a qualifying break; and driving in excess of ten hours. Whilst it is correct to state that the TC did not have before him a DVSA investigation, there was ample evidence which had been provided by the company upon which he could come to the findings that he did and it was right and proper that he did so. As for the call up letter, that made it clear that drivers’ hours and tachographs were an issue to be considered. Although maintenance was the focus and Mr AN could not have doubted that drivers’ hours were to be considered bearing in mind that the letter advised that the company should collect the tachograph cards for the previous four months amongst other material in order to demonstrate that it was a compliant operator. If Mr AN or Mr Newman had been caught unawares by the issue of drivers’ hours being considered during the course of the public inquiry, it was open to Mr Newman to apply for an adjournment; this he did not do.
9. Mr Newman turned to the TC’s finding that “the strong implication is that the driver failed consistently to carry out effective checks of the vehicle and that the operator failed to identify this failure”. Mr Newman submitted that there was no evidence put before the TC by DVSA on this issue as a vehicle examiner had not conducted a maintenance investigation. We disagree. Mr AN produced over one hundred driver defect reports all of which reported “nil” defects. As a result of our collective experience of the transport industry, we share the TC’s disbelief that even in respect of a well maintained vehicle, there will not be the occasional defect found during the daily walk round check. The irresistible conclusion is that the driver was not conducting the checks effectively. That is obvious from some of the defects for which PG9’s were issued, for example, the absence of spray suppression equipment and damage to body work. The TC had the benefit of perusing the PMI sheets produced by Mr AN which were not within the appeal bundle. He found items which should have been identified by the driver prior to the PMI taking place. There was before the TC, ample evidence upon which to find as he did.
10. Mr Newman’s next point was that the TC failed to give separate consideration to the issues which gave rise to discretionary regulatory action being taken under s.26 of the Act and the assessment of good repute. In relation to s.26 of the Act, the TC failed to make any proper assessment of the evidence to justify taking action under that section when s.26 required the TC to look at each ground individually and to assess whether the findings justify taking action and upon what basis. Mr Newman referred to Thomas Muir (supra) which he submitted gave guidance on this point although deterrence was not relevant in this case. Further, Mr Newman drew our attention to s.26(1)(iii) of the Act which refers to “a prohibition”. The use of the singular should be contrasted with the wording of paragraph 3 of Schedule 4 of the Act which refers to “convictions”. Mr Newman submitted that the wording of s.26(1)(iii) required the TC to consider each prohibition in turn and determine whether each PG9 justified action being taken. He conceded that the PG9’s did not have to be “S” marked in order for regulatory action to be taken.
11. As for revocation under s.27(1) and loss of repute, Mr Newman accepted that he had a “high hurdle” to climb but there were mitigating factors which made a finding of loss of repute disproportionate and revocation inappropriate. The Tribunal had previously stated that the overall picture should be considered. There was sufficient evidence in this case that the company and Mr AN were not beyond redemption. The TC could have revoked the company’s licence but delayed the effect of the order to allow Mr AN an opportunity to make an application for a new licence and establish that he and the company met all of the requirements.
12. Mr Newman concluded that the decision to revoke was disproportionate and plainly wrong. At the date of the public inquiry, all of the systems were in place along with a more robust approach to compliance. The maintenance picture was not a bad one. Mr Newman accepted that the position of Mr AN as a Transport Manager was tied in with the position of the company.
13. It is clear on the face of the TC’s decision that he did give separate consideration to the issues which gave rise to regulatory action under s.26 of the Act as set out in paragraph 11 of his decision. We reject the submission that the wording of s.26(1)(c)(iii) requires separate analysis and determination of each prohibition. The wording simply means that there must be at least one prohibition for action to be taken under that subsection. The TC then undertook a faultless balancing exercise (paragraph 12) and rightly came to the conclusion that the negative features outweighed the positive. He considered and answered the Bryan Haulage (supra) and Priority Freight (supra) questions and then dealt separately with the issue of good repute (paragraph 18). It cannot be said that the decisions of the TC were either disproportionate or plainly wrong and we cannot find that we are impelled by reason of fact or law to interfere with the decision as per the test set out in Bradley Fold (supra).
14. The appeals are dismissed and the orders of revocation and disqualification will come into effect as 23.59 on 28 September 2014.
Her Honour Judge J Beech
1 September 2014