Neutral Citation Number: [2013] UKUT 036 (AAC)
Appeal No.  T/2012/56 T/2012/57
IN THE UPPER TRIBUNAL		
ADMINISTRATIVE APPEALS CHAMBER
TRAFFIC COMMISSIONER APPEALS

ON APPEAL FROM THE DECISION OF Nick Jones
TRAFFIC COMMISSIONER for the West Midlands
 TRAFFIC AREA dated 21 August 2012

Before:
Her Honour Judge J Beech, Judge of the Upper Tribunal
Stuart James, Member of the Upper Tribunal
Michael Farmer, Member of the Upper Tribunal

Appellants:

DEEP TRANSPORT LIMITED
MIDLAND TRANSPORT LIMITED

	 
Attendances:
For the Appellant: 	Simon Newman, Solicitor of NA Commercial Solicitors appeared on behalf of both Appellants

Heard at:	Victory House, 30-34 Kingsway, London, WC2B 6EX
Date of hearing:	8 January 2013
Date of decision:	22 January 2013

DECISION OF THE UPPER TRIBUNAL

IT IS HEREBY ORDERED that the appeals be DISMISSED

SUBJECT MATTER: Good repute; breach of undertakings; “phoenix” company; disqualification.

1.	CASES REFERRED TO: Priority Freight Limited (2009/225); Bryan Haulage (No.2) (2002/217); David Finch t/a David Finch Haulage (T/2010/29)  all to be found at: http://www.justice.gov.uk/downloads/tribunals/transport/decisions-and-digest/traffic commissioners.digest.pdf. 

REASONS FOR DECISION

1.	These were appeals from the decision of the Traffic Commissioner for the West Midlands Traffic Area made on 21 August 2012 when he revoked the Appellants’ standard national operator’s licences under s.26(1)(i); s.26(1)(c)(iii); s.26(1)(ca); s.13A(2)(b)-(c) of the Goods Vehicles (Licensing of Operators) Act 1995 (“the Act”) and disqualified Kiranjit Kaur, director of Deep Transport Limited and Sukhpal Singh, director of Midland Transport Limited, for a period of four years each.

2.	The factual background to the appeals appear from the documents, previous Tribunal decisions and the Traffic Commissioner’s written decision and is as follows:

(i)	On 30 January 2009, the Transport Tribunal upheld the decision of the Deputy Traffic Commissioner for the West Midlands Traffic Area dated 10 October 2008, in which he ordered the revocation of the standard national operator’s licence of Sukhpal Singh, trading as Deep Transport and disqualified him from holding or obtaining an operator’s licence for twelve months.  The orders came into effect on 13 February 2009.  The Tribunal’s decision, 2008/668 Sukhpal Singh trading as Deep Transport can be found at http://www.justice.gov.uk/downloads/tribunals/transport/decisions-and-digest/traffic-commissioners.digest.pdf .  This present decision must be read in conjunction with decision T/2008/668.

(ii)	On 13 October 2008, three days after the Deputy Traffic Commissioner’s orders of revocation and disqualification, Kiranjit Kaur, Mr Singh’s wife, applied for a standard national operator’s licence authorising three vehicles and six trailers on behalf of Deep Transport Limited.  For the regulatory history of that licence and for the general background to these present appeals see T/2011/65 Deep Transport Limited which can be found at http://www.justice.gov.uk/downloads/tribunals/transport/decisions-and-digest/traffic-commissioners.digest.pdf. This present decision must be read in conjunction with decision T/2011/65.  

(iii)	In short, the Tribunal’s decision in T/2011/65, concerned an appeal against a finding of loss of repute both in relation to Deep Transport Limited and Mrs Kaur.  The Tribunal upheld the Deputy Traffic Commissioner’s findings of missing mileage; a failure to record mileage on tachographs; drivers’ hours and records offences; a failure to provide driver training; operating unauthorised vehicles; use of an operator’s licence disc of a company in liquidation and last but not least, dishonesty and untruthfulness on the part of Mrs Kaur in her dealings with members of VOSA staff.   In upholding the Deputy Traffic Commissioner’s findings that both Mrs Kaur and Deep Transport Limited had lost their good repute, the Tribunal recorded that it was a “bad case with significant breaches of the undertaking in relation to drivers’ hours and records with continuing wrong doing”.  The Tribunal highlighted a number of aspects of evidence which had not been properly explored at the public inquiry, which might have resulted in further adverse conclusions in relation to the honesty and trustworthiness on the part of Mrs Kaur.  However, the appeal was allowed because of the four month delay between the public inquiry and the publication of the Deputy Traffic Commissioner’s decision.  The Tribunal concluded that it could not be said in the circumstances, that the balancing exercise required to be undertaken prior to the revocation of a licence had been undertaken at the correct stage i.e at the time of making the decision.  The Tribunal warned that whilst changes and improvements in the operational conduct of the company and Mrs Kaur might have been achieved in the four month period of delay and that any improvements there might have been would weigh positively in the favour of both Deep Transport Limited and Mrs Kaur, whether any such positive evidence would alter the position in relation to loss of repute was another matter.  The case was remitted for full re-hearing (our emphasis now) before a different Traffic Commissioner with an expressed expectation that a fresh maintenance and drivers’ hours investigation would be undertaken prior to the re-hearing and that the various “unresolved matters” be investigated further.  Further investigations did take place and a new call up letter was sent out on 21 June 2012, setting out the new evidence to be relied upon and specifically referring back to the original call up letters which called Deep Transport Limited and Midland Transport Limited to the public inquiry in June 2011. 

(iv)	The re-hearing took place on 27 July 2012.  Traffic Examiner Lees attended on behalf of VOSA.  Mrs Kaur and Mr Singh attended and were represented by Mr Newman.  Also present were Paul Lewis, an administrator employed by both companies and Shane Flynn, the proposed Transport Manager for Deep Transport Limited.  In his written decision dated 21 August 2012, the Traffic Commissioner found that the previous adverse findings made by the Deputy Traffic Commissioner were fully justified.  He then went on to make further adverse findings in the light of the more recent evidence.

3.	It should be made clear at this stage, that the financial information produced by both companies during the course of the public inquiry was inadequate to support their respective authorisations.  Deep Transport Limited had the necessary finance to support the authorisation of one vehicle only; Midland Transport Limited had insufficient financial standing for any authorisation.  It was conceded by Mr Newman during the course of the appeal hearing, that in the circumstances, revocation was inevitable in the case of both companies.  He also conceded that both companies had lost their good repute by reason of their continued use of unauthorised vehicles (see below).  The issues in this appeal are a) whether the Traffic Commissioner’s findings of loss of repute as a result of dishonesty on the part of Mrs Kaur was justified and b) whether a period of disqualification was justified in the case of either Mrs Kaur or Mr Singh and in the alternative c) whether a period of disqualification of four years was proportionate in respect of both Mrs Kaur and Mr Singh.  

4.	The evidence before the Traffic Commissioner which was relevant to those issues is summarised below under specific headings along with the Traffic Commissioner’s findings:

(i)	Unauthorised use of vehicles

On 27 February 2012, Traffic Examiner Lees sent letters to both companies requesting the production of tachograph charts for the period 1 January to 4 February 2012.  On 9 March 2012, he attended the joint operating centre of the Appellants and met with Phillip Whitehouse who said that he was a CPC holder working for both operators but that he was not nominated on either licence.  He produced the tachograph records and other related documentation.  He later produced digital tachograph data.

(ii)	TE Lees returned to the operating centre having analysed the tachograph charts.  Mr Singh then produced three handwritten schedules in relation to both Deep Transport Limited and Midland Transport Limited showing that on twelve occasions during the month of January, the companies had used unspecified vehicles in excess of their authorisation.  In some instances, the vehicles were shown on the schedules as being operated on the standard international licence of Shane Flynn.  Registered keeper checks showed that Deep Transport Limited was the registered keeper of ten large goods vehicles with a further vehicle used by Midland Transport Limited which was recorded as “transferred to motor trade”.

(iii)	Mrs Kaur was interviewed under caution.  In relation to the use of unauthorised vehicles she said “we made lots of changes on those days; we buy new vehicles.  That’s why this happened.  Now we got very good new staff, who’s got the full control on these things to stop this happening again”. During the public inquiry, Mrs Kaur accepted that the two companies had been using vehicles in excess of their authorisation since the last public inquiry.  She described the position as a “misunderstanding” because she had mixed up the two companies vehicles because the two operations “run together”.

(iv)	Mr Singh was interviewed under caution and stated “What happened January time we were changing too many vehicles, then VOR so we change to another vehicle.  That was why we may be over using.  Now we are strict; if vehicle VOR we taken off.  From end of January we don’t use any other vehicle”. In his evidence to the Traffic Commissioner, Mr Singh accepted that as the sole director and the Transport Manager for Midland Transport Limited, he was responsible for operating unspecified vehicles in excess of the licence authorisation of the company and that he did so despite the findings of the previous public inquiry.  He said that he and his wife had since sold the spare vehicles they had acquired and this would prevent a recurrence of unauthorised use.

(v)	For the sake of completeness on this subject, during the course of the re-hearing Mrs Kaur was asked about the unauthorised use of vehicle YJ05 YDW on 19 January 2011 which had not been the subject of questioning by either the Deputy Traffic Commissioner or Mr Newman during the original public inquiry.  Mrs Kaur said that whilst she had evidence concerning the use of the vehicle, she had not brought it to the public inquiry.  She had nothing else to add about that vehicle.

(vi)	The Traffic Commissioner’s findings were as follows:

“I find that in the case of both operator’s licences, vehicles were often run in excess of authorisation.  VOSA asked for tachographs for a limited period only, but found a substantial proportion of days with vehicle authorisation exceeded.  The fact that this was a historic feature and a snapshot revealed it still occurs, assists me in concluding that both entities ran in excess of authorisation as a matter of routine through-out the period since the previous VOSA investigation.  The lack of attention to this issue by directors (Kiranjit Kaur and Sukhpal Singh) corroborates my view.  I also find corroboration in the response from Sukhpal Singh to being told that he was running too many vehicles on occasions.  His response to VOSA was that “they were now strict” .. causes me concern, in context with the seriousness of the issue and the lack of tangible means to address this shortcoming.  I consider the response to be risible and note that at the hearing before me nothing of substance was offered to me to make me think that the culture of operating in excess of authority would change in the future.”

(vii)	Transport Managers

On 27 December 2011, Alan Caffrey sent an email to VOSA stating that with effect from 30 December 2011, he had resigned as the nominated Transport Manager in respect of both companies.  As a result, the Central Licensing Unit (“CLU”) wrote to Deep Transport Limited requiring details of the company’s new Transport Manager by 25 January 2012.  No response was received.  

(viii)	When TE Lees attended the joint operating centre of the Appellants’ on 9 March 2012, he met with Phillip Whitehouse who stated that he was the CPC holder working for both companies.  He was not however nominated.  By 14 April 2012, he was no longer connected to either company, Mr Singh informing TE Lees that Shane Flynn was now the CPC holder for both companies.  The CLU then sent a further letter on 10 May 2012 requiring details of the new Transport Manager.  Again no response was received.  However, on 15 May 2012, an application was received by the CLU for the nomination of Shane Flynn as Transport Manager on the licence of Deep Transport Limited.  It would appear that at some stage, Mr Singh’s nomination as Transport Manager for Midland Transport Limited had been accepted administratively by the CLU without the application being put before the Traffic Commissioner.

(ix)	When asked about the period of four and half months when Deep Transport Limited operated without a nominated Transport Manager, Mrs Kaur initially stated that despite the fact that she is a CPC holder herself, she was under the impression that an email from Mr Caffrey to VOSA was sufficient notification to the Traffic Commissioner that she was without a Transport Manager.  When pressed, she stated that she thought she had a period of grace within which to make the nomination and when further pressed she stated that she had thought of nominating Mr Whitehouse as soon as he was taken on in January 2012 but had not done so.  She apologised.  She was not asked to explain why two letters from the CLU went unanswered.

(x)	The Traffic Commissioner’s findings on this issue were as follows: 

“96. Kiranjit Kaur could and should have notified me of her transport manager tendering his resignation on Christmas Eve 2011.  She cannot justifiably claim ignorance as there have been previous periods without a transport manager, albeit Deep Transport as opposed to Deep Transport Limited.  These periods without a transport manager contributed to the decision to revoke the Deep Transport licence and to disqualify Sukhpal Singh  .. It was also a feature mentioned in paragraph 2(1)(i) of Deep Transport Ltd 2011/065 which led to this rehearing....
105. .. I did put to Kiranjit Kaur that (Caffrey) claimed that drivers were not trained when he wanted, Kiranjit Kaur denied this.  I reflect that the transport manager was similarly unaware of vehicles being run in excess of authorisation.  Whilst I accept that this was probably so, I conclude that this was because the two owners, Kiranjit Kaur and Sukhpal Singh, were running the transport, leaving transport managers employed with tasks allocated to them and kept out of dealings which would have revealed the extent of the running with too many vehicles.  .. Kiranjit Kaur says what suits her purpose at the time.
106. Kiranjit Kaur did not notify me immediately of the resignation of transport manager Caffrey as he was incidental to the running of the business.  Although Kiranjit Kaur made a reference to thinking that she automatically had a period of grace to appoint a new transport manager, I do not believe her.  She was aware of the history of previous criticisms of her husband allowing long periods without a transport manager and she says she is a qualified CPC holder herself.  She attempted to mislead me to suit her purposes.
121. Operating without an approved nominated transport manager .. is a feature that occurs occasionally .. and I accept a genuine misunderstanding as to responsibilities.  But in this case the lack of transport manager was specifically referred to by a previous transport tribunal and it was referred to in the Upper Tribunal case that led to this re-hearing.  No justification was given to me for the repetition of this fundamental failure.  My finding is that any transport manager will not have true management and responsibility for the transport, rather they will only have limited responsibility for checking specific issues that Karanjit Kaur or Sukhpal Singh allow them to look at.”  

(xi)	Dishonesty, deception & obstruction

During the course of the public inquiry, the Traffic Commissioner reviewed the summary of the evidence in the Tribunal case 2011/65.  In her evidence at the re-hearing Mrs Kaur accepted that her answers to VE Male about the use of KX51 ETV (Mr Singh’s vehicle) were misleading but attempted to justify them by stating that VE Male did not ask her who the driving instructor was.  Mrs Kaur repeated her reasons for not being more forthcoming with VE Male i.e. that she was worried about her children.  

(xii)	It was put to Mrs Kaur that failing to make keys available to a vehicle which TE Lees wished to enter could be regarded as obstructive.  Her response was “we did overuse and are sorry for that.  Made a lot of changes, but since mid January we have improved”.

(xiii)	In respect to both of these issues, the Traffic Commissioner found: “I find as fact that the response .. given to VOSA that a vehicle was owned by a driving instructor was given by Kiranjit Kaur in an attempt to mislead VOSA.  Traffic Examiner Lees noted that a vehicle examiner was unable to examine the interior of a vehicle as the keys were not made available to them.  I find that this was calculated obfuscation to prevent or delay a proper investigation.”

(xiv)	Mrs Kaur was asked about the apparent inconsistency between her evidence given to the Deputy Traffic Commissioner and that of Mr Caffrey in relation to the analysis of tachographs before August 2010.  Mrs Kaur confirmed that her tachographs had been analysed and she produced an invoice which she believed supported the evidence that she had given to the Deputy Traffic Commissioner.  Once it was pointed out to her that the invoice was addressed to her husband’s former business, Deep Transport, and that in any event it pre-dated the establishment of her own business, Deep Transport Limited (a matter conceded by Mr Newman), Mrs Kaur nevertheless insisted that her tachographs had been analysed before August 2010.  Whilst other documentation was produced which suggested that Mr Caffrey had in fact implemented a system of tachograph analysis in June 2010 rather than August 2010, Mrs Kaur was unable to provide any evidence to confirm her evidence that tachograph analysis pre-dated June 2010, stating that she had not appreciated that the Traffic Commissioner was going to ask her questions on the point.  The Traffic Commissioner pointed out that the Tribunal had highlighted the need to further investigate the issue of tachograph analysis prior to August 2010 and yet she had attended the public inquiry unprepared.  He asked Mrs Kaur “if you don’t understand this, are you capable of running a complaint operation?”, to which Mrs Kaur made  no reply.

(xv)	The Traffic Commissioner found that the documentation produced by Mrs Kaur which related to her husband’s revoked licence was a “deliberate, albeit vain attempt to deceive me.  There never had been the previous tachograph analysis as originally claimed at the 2011 public inquiry”.

(xvi)	He also concluded that his own attempts to draw explanations for the gaps in Mrs Kaur’s evidence given before the Deputy Traffic Commissioner which came to nought was the result of Mrs Kaur being unable to answer them as to do so would lead to the exposure of her “wholesale failures”.  He further found that Mrs Kaur said what suited her own purpose at the time and sometimes this was with little or no regard for the truth; he did not trust her.

(xvii)	The Traffic Commissioner also heard evidence from Mrs Kaur that she intended in the future to re-employ Mr Caffrey either in the office or the garage whilst retaining the services of Mr Flynn as Transport Manager.  Her justification for this plan was that they had six vehicles between the two companies and that they also did repair work for other companies.  However, when giving evidence about revocation, Mr Singh described the repair work undertaken by the companies as being very small as the Appellant companies only had one mechanic between them to repair their vehicles.  The Traffic Commissioner commented that the repair side of the Appellants’ operations had  been presented in a very different light earlier in the evidence.

(xviii)	Further evidence was given about the brokerage work that the companies received as a result of the website (see below).  Mr Singh described it as “not so much”.  They might receive £5 for a pallet or £10 to £15 for a load.  

(xix)	The Traffic Commissioner concluded from this evidence that when it suited their purpose, Mrs Kaur and Mr Singh sought to lead him to believe that they undertook maintenance work for others and also a brokerage business.  When it came to asking the Traffic Commissioner to step back from the revocation of their licences, these sources of income were minimised.  This was symptomatic of the culture of evasion.  Operator licensing was based on trust and neither director was trustworthy.

(xx)	Evidence that Deep Transport Limited was a “phoenix” operation

The original call up letters dated 14 April 2011 calling both companies to the public inquiry before the Deputy Traffic Commissioner put them on notice that the Deputy Traffic Commissioner would have regard to the close connection between the two companies.  In the event, the Deputy Traffic Commissioner found that whilst there were close connections, both in terms of premises and personnel, there was no evidence before him that Mr Singh had been involved in the running of Deep Transport Limited whilst disqualified other than direct evidence of occasional driving duties.  The call up letter of 21 June 2012 did however, inform the Appellants that the same issue would be re-addressed.

(xxi)	During TE Lee’s visit to the operating centre on 16 April 2012, Mr Singh told him that both licences were “effectively looked after by him for the majority of the time.”

(xxii)	The evidence of Ms Kaur at the re-hearing relevant to this issue was as follows: in relation to the operation of vehicles in excess of both Appellants’ authorisation, she explained that it was because she had “got mixed up with Midland and Deep vehicles because both companies are run together”; when asked whether the two licences are “run as one” her reply was “Yes, it’s two licences, but the same operating centre, same customers”; when asked whether there were two licences because of Mr Singh’s history of revocation, Mrs Kaur replied “yes”.

(xxiii)	During the course of the re-hearing, the Traffic Commissioner referred to a website entitled “Deep Transport”.  Amongst other things, the website claimed that the following vehicles were available from “our modern vehicle fleet – vans to artics, long and short term storage, UK and Europe coverage, satellite tracking, full or part loads, highly trained & motivated staff, same day, next day, or 2-3 day delivery options, Moffett Mounty forklifts. 

 Another page read:

“About Deep Transport Road Haulage – Deep Transport are a successful, privately owned company established in 2001 with a wealth of experience in distribution, warehousing and logistics.  With a West Midlands location giving us easy access to all major trunk and motorway networks.  

The ongoing development within our company to achieve and maintain quality standards for the services we provide is matched only by our desire and enthusiasm to be the best at what we do.  We believe in strong quality partnerships with our customers using the principles of openness, trust and shared priorities.  

We have also our contracts manager who will deal with you has (sic) a customer direct for your needs.  He will ensure that your contract or your deliverys (sic) are on time and with regular visits to keep you informed of any changes that Deep Transport are (sic) making.”

The website also contained a list of nine different types of vehicle and trailers which were operated as part of the Deep Transport fleet.  All of the vehicles were said to be tracked by satellite “24/7 365 days a year”.

(xxiv)	When asked about this website and the services provided for example, international services, Mrs Kaur stated “we advertise it, but we out-contract many services”.  When it was suggested that the advertisement was in grandiose terms, Mrs Kaur replied “when any European load comes up, my husband deals with separate company which carries the load.”

(xxv)	Mr Singh told the Traffic Commissioner that the website had been made “a very long time ago when Deep Transport was running” (the revoked licence).  It had been last up-dated “three or four months ago” by the person who created it.  That person was responsible for the content of the website.  He accepted that its assertions were “nonsense” but they were acting as agents.  He accepted that the website reads as though Deep Transport had a fleet of the description set out. 

(xxvi)	The Traffic Commissioner found that Deep Transport Limited was a “classic phoenix company” set up as a means of circumventing a decision of the Tribunal to uphold the revocation of Mr Singh’s Deep Transport licence and his disqualification.  He relied upon the following:

a)	Mrs Kaur admitted that the rationale for applying for a licence for the new entity Deep Transport Limited was the revocation of her husband’s licence together with his personal disqualification;
b)	The business model for the two entities appears to be based on the website in the name of Deep Transport (the existence of which might explain the operation of vehicles in excess of authorisation); 
c)	Mrs Kaur accepted that there would be a perception that the two entities ran as one and Mr Singh accepted that some aspects of the two operations were shared;
d)	Both entities have been found to operate vehicles in excess of authority;
e)	Mrs Kaur worked considerably constricted hours as she prioritised her childcare.  Whilst the Traffic Commissioner was not troubled by this in principle, it pointed to Mrs Kaur being more of a figure head than the controlling mind of Deep Transport Limited;
f)	   It was now evident that Mrs Kaur had deliberately sought to mislead VOSA as to vehicles being operated.  
g)	He further relied upon Mr Singh writing to the Traffic Commissioner’s staff on behalf of Deep Transport Limited in relation to the supply of information to Mr Newman.

The Traffic Commissioner concluded that both licences were operated together which might have explained the confusion in Mrs Kaur’s mind about which vehicles were being operated under which licence when she was interviewed under caution.  He found that the licence of Deep Transport Limited was founded on deceit.  That deceit had been successful in that the company had traded whilst Mr Singh was disqualified from holding or applying for a licence.  He found that the two companies were separate in law but were to a large extent run as one.  The principal controlling mind of both was Mr Singh albeit assisted by Mrs Kaur.

5.	When addressing the Priority Freight/Bryan Haulage (No.2) questions, the Traffic Commissioner concluded that each Appellant company had failed to operate within their respective vehicle authorisations granted and had exceeded those authorisations on a regular basis.  There was also a persistent pattern of failure to inform the Traffic Commissioner of a lack of Transport Manager and to seek a period of grace.  He made the adverse findings which are set out in paragraph 4(x) above.  Evidence additional to the previous findings made by the Deputy Traffic Commissioner caused the Traffic Commissioner to believe that the two companies were run as one (as conceded by Mrs Kaur) and that the reason for the original licence application by Deep Transport Limited was to circumvent the Transport Tribunal’s confirmation that Mr Singh’s operator’s licence should be revoked and that he be disqualified.  The Traffic Commissioner found that both Mr Singh and Mrs Kaur would say what suited their purpose at the time and that they were not to be relied upon to tell the truth.  Mr Singh ran both licences.  Further there was a lack of candour as to the source of income.  He found that it was apparent that neither Mrs Kaur or Mr Singh had read the Tribunal decision of Deep Transport Ltd 2011/65 and that supported his finding that neither director was capable of running a compliant transport business.  He accepted that issues relating to maintenance, drivers’ hours and records were not such that they would result in any severe regulatory action (there having been a marked improvement) but that these positive factors were more than counter balanced by the numerous serious negative features which went to integrity and trust.  By reason of his overall findings, the Traffic Commissioner found that Mrs Kaur and Mr Singh failed to meet the minimum threshold for a licence because they could not be trusted to ensure future compliance.  They deserved to be put out of business and disqualified each director for 4 years.

6.	At the hearing of this appeal, Mr Newman represented both Appellants and provided the Tribunal with a skeleton argument for which we were grateful.  His first point related to the Traffic Commissioner’s findings that Mrs Kaur and Mr Singh had been dishonest and that they both lacked integrity.  Quite apart from Mrs Kaur’s admitting that she had misled VOSA officers in 2010, the Traffic Commissioner went on to make further adverse findings in relation to both Mrs Kaur and Mr Singh which were based upon supposition without any evidential foundation and to that extent they were plainly wrong.  The position was particularly unfair in Mr Singh’s case because the Traffic Commissioner failed to ask any probing questions about his integrity.  As a result, Mr Singh was not afforded any opportunity of addressing the Traffic Commissioner upon that issue during the course of the hearing.  Further, the Traffic Commissioner was wrong to find that by reason of their answers relating to the Deep Transport website, the contracting out of work and maintenance that Mrs Kaur and Mr Singh were being dishonest and that any contradiction in their evidence demonstrated that both directors were dishonest.

7.	We do not find that there is anything in this point.  The very many areas in which Mrs Kaur’s evidence was unsatisfactory and unreliable have been set out in the previous decisions.  It is surprising to say the least that having been put on notice about the areas of evidence which this Tribunal had previously found to be wanting, that neither Mrs Kaur or Mr Singh put before the Traffic Commissioner the evidence necessary to corroborate Mrs Kaur’s evidence on matters such as tachograph analysis prior to June/August 2010 and the use of unauthorised vehicles.  Rather, a document was produced to support Mrs Kaur’s evidence that tachograph analysis had taken place, which was obviously a document that related to Mr Singh’s previous operator’s licence.  We are satisfied that this was a further example of an attempt to deceive.  Whilst it is clear that the vast majority of the Traffic Commissioner’s findings of dishonesty and lack of integrity were made against Mrs Kaur alone, the Traffic Commissioner’s ultimate finding that Deep Transport Limited was a “phoenix” operation which is in itself a finding of deceit related to both Mr Singh and Mrs Kaur.  Further, we are satisfied that the Traffic Commissioner’s findings in relation to the inconsistency of evidence upon the issues of maintenance and freight forwarding were well made out on the evidence.  

8.	Mr Newman’s next point related to the Traffic Commissioner’s findings concerning the Deep Transport website.  Mr Newman did not pursue a ground of appeal concerning the lack of notice given to the Appellants about the Traffic Commissioner’s intention to refer to the website.  Mr Newman submitted that the website did not have any probative value and could not and should not have been used to support adverse findings.  Mr Newman submitted, contrary to the evidence of Mr Singh at the public inquiry, that in fact the website had been constructed after Mr Singh’s disqualification and that as a result it was not relevant.  Further, it was wrong to find that there was a contradiction in the evidence that Mrs Kaur and Mr Singh gave about the website when first describing it as a source of income as a freight forwarder and then minimising that income when answering questions about how revocation would affect the couple.  He also submitted that “Deep Transport” was a trading name and that little if anything should be read into the fact that the website did not refer to a limited company. 

9.	We are satisfied that the website was in fact highly relevant to the issues being considered by the Traffic Commissioner.  First of all, it demonstrated that Mr Singh trading as Deep Transport had set up the website.  We place no weight upon the assertion made to the Tribunal for the first time that the website post-dated Mr Singh’s disqualification, not least because the website is entitled “Deep Transport” and not “Deep Transport Limited” as would be appropriate if the website had been created for the Appellant company.  Secondly, the website continued to be utilised and updated up until a few months prior to the hearing before the Traffic Commissioner and this demonstrated that the website had been used by Deep Transport Limited and also by Midland Transport, indicating that an effortless transfer of undertaking had taken place between Mr Singh trading as Deep Transport  and Deep Transport Limited.  Thirdly, Mrs Kaur stated that the website was the responsibility of Mr Singh, she having little to do with it.  This indicated that he was involved from the outset with the marketing of Deep Transport Limited and that Deep Transport Limited simply took on the mantle of Mr Singh trading as Deep Transport.  Fourthly, the website described the transport operation in “grandiose” terms which gave a false impression as to the extent and standing of the operation.  That was highly relevant not only to honesty and integrity but it was in all likelihood, relevant to unauthorised use of vehicles.  We are satisfied that the website’s content could only give rise to adverse inferences in relation to both Mrs Kaur and Mr Singh.  The fact that “Deep Transport” is a trading name does not assist the Appellants.  

10.	 Mr Newman’s next point related to the Traffic Commissioner’s findings that Deep Transport Limited was a “phoenix” operation.  First of all, he contended that the issue of links between Mr Singh, Deep Transport Limited and Midland Transport Limited had not featured in any of the call up letters.  The fact that this contention was factually incorrect was pointed out to Mr Newman during the Tribunal hearing.  Secondly, Mr Newman contended that the fact that once Midland Transport Limited was granted its licence that it then ran together with Deep Transport Limited for all intents and purposes was not evidence that should cause adverse inferences to be drawn.  There is nothing unusual in overlapping companies running together or indeed in family members setting up a transport business when a relative had had their licence revoked.  The Traffic Commissioner’s findings were based on assumption and he should not have found that Deep Transport Limited was either a “phoenix” or a “front” without further probative questioning.  

11.	We are satisfied that there is nothing in this point.  First of all, there was considerable evidence before the Traffic Commissioner that Deep Transport Limited was set up in order to enable Mr Singh to continue operating vehicles.  Whether that set up was either  “a phoenix” or “a front” matters not.  It is somewhat surprising that the licence was granted in the first place, in view of Mrs Kaur’s inexperience in operator licensing at the time of her application particularly when Mr Singh gave evidence in the public inquiry resulting in the Tribunal decision 2008/668 to the effect that the compliance issues raised in respect of his own licence were the result of Mrs Kaur’s inability to operate his licence compliantly whilst he was in India.  We are satisfied that there was in fact evidence before the Deputy Traffic Commissioner which should have raised questions about the connection between Deep Transport Limited, Mr Singh and Midland Transport Limited.  The fact that alarm bells did not ring as a result of the evidence before the Deputy Traffic Commissioner is surprising, such evidence including Mrs Kaur’s apparent inability to provide adequate operational detail of her business; Mr Singh’s own vehicle being used under the umbrella of the licence of Deep Transport Limited fleet (which was one of the unauthorised vehicles being used); that this vehicle was insured by Deep Transport Limited; that Deep Transport Limited’s insurance covered haulage as well as driving instruction (not something that Deep Transport Limited engaged in); that Midland Transport Limited, which had been operating vehicles for only one month prior to the public inquiry before the Deputy Traffic Commissioner, was using the vehicles belonging to either Deep Transport Limited and/or Mrs Kaur yet Mrs Kaur was unable to say how much Midland Transport Limited was paying for the use of those vehicles (and was still unable to do so at the hearing before the Traffic Commissioner); that the two companies shared facilities and personnel.  The evidence became overwhelming once Mrs Kaur made admissions as to the reasons for Deep Transport Limited being incorporated and for then applying for a licence.

12.	Mr Newman then turned to the failure of Deep Transport Limited to have an approved transport manager between January and 15 May 2012.  He submitted that Mr Whitehouse was acting transport manager from about January 2012 and he was then replaced by Mr Flynn in about April 2012.  The mischief in this case was that there had been a failure to notify the Traffic Commissioner of the identity of the transport managers rather than a failure to have one at all.  In the circumstances, the findings of the Traffic Commissioner were harsh.  We disagree.  Two letters from the OTC enquiring about the existence of a transport manager were ignored by Mrs Kaur and we agree with the Traffic Commissioner’s assessment of Mrs Kaur’s explanation as to why she did not apply to the Traffic Commissioner for approval of those she had appointed.  It did not withstand close scrutiny.

13.	Mr Newman’s next point related to Mr Singh’s separate roles as transport manager and director of Midland Transport Limited.  He submitted that those roles are quite distinct and that in his role as transport manager, Mr Singh had achieved much in relation to maintenance and drivers’ hours and records.  Mr Newman was forced to concede that Mr Caffrey had been the transport manager up to the end of December 2011 and that the maintenance investigation had then taken place in February 2012, but nevertheless, Mr Newman argued that in the period following the investigation nothing else had come to light.  Mr Newman criticised the Traffic Commissioner for failing to make a separate assessment of the good repute of Mr Singh as a transport manager as opposed to his role as a director.  We pointed out to Mr Newman that Mr Singh had admitted to running vehicles in excess of authorisation and that went to his good repute as both director and transport manager and that in those circumstances, no separate assessment was required.  We have already noted that the Traffic Commissioner did in any event give positive weight to the improvements in maintenance and drivers hours and records.

14.	In coming to his determination about the appropriate level of disqualification in this case, the Traffic Commissioner referred to a number of decisions and the Senior Traffic Commissioner’s Statutory Document No. 10 entitled “The principles of decision making & the concept of proportionality”.  Mr Newman referred the Tribunal to paragraph 69 of that document which states:

“Taking account of the guidance from the Upper Tribunal that each case must be looked at on its merits traffic commissioners may wish to use as a starting point for a first public inquiry consideration of a disqualification period of between 1 and 3 years but serious cases, where, for example, the operator deliberately puts life at risk and/or knowingly operates unsafe vehicles or allows drivers to falsify records, may merit disqualification of between 5 to 10 years or in certain cases for an indefinite period”.

Mr Newman submitted that neither the case of Mrs Kaur or Mr Singh fell within the 5 to 10 year bracket of disqualification and the Traffic Commissioner had failed to mention in his decision, the case of T2010/29 David Finch t/a David Finch Haulage, a Tribunal case which helpfully summarises the key Tribunal decisions upon the issue of disqualification.  Having found that the worst features of that case were the refusal of Mr Finch as driver/operator to comply with a lawful direction to stop by a VOSA officer and a significant vehicle overloading coupled with a braking defect, the Tribunal found that a 3 year disqualification was too long and thus reduced the period of disqualification to 18 months.  Mr Newman submitted that the decision of the Tribunal in that case fortified his own submissions that 4 years was too long in this present case, particularly as there were no safety issues.  Further, he submitted that there was no appearance of a separate assessment of the appropriate period of disqualification for Mrs Kaur and Mr Singh. There should have been a differentiation between them. Further and in any event, a period of 4 years for both Mrs Kaur and Mr Singh had the effect of putting them out of business for too long and that was not justified on the evidence.

15.	Whilst the decision in T2010/29 David Finch t/a David Finch Haulage reviews the Tribunal’s previous decisions on the subject of disqualification, the decision itself turns on its own facts.  It cannot therefore be of any real assistance in determining whether the disqualifications in this case were justified or proportionate.  First of all, we are satisfied that disqualification was justified in relation to both Mrs Kaur and Mr Singh.  In the case of Mrs Kaur, she was responsible for incorporating a company the purpose of which was to circumvent the orders of revocation and disqualification of the Tribunal in respect of Mr Singh and his operator’s licence.  She had attempted to deceive VOSA in a number of ways and she had attempted to deceive not only the Deputy Traffic Commissioner but also the Traffic Commissioner in a number of ways.  She further admitted to consistent operation of vehicles in excess of her company’s authorisation between the two public inquiries.  The Tribunal is in no doubt that disqualification was justified and that a period of 4 years was also justified and proportionate.  As for Mr Singh, he had previously been disqualified.  He had circumvented the orders of revocation and disqualification by allowing his wife to incorporate a company and apply for a licence to take over his business in which he then played an active role.  He used his own vehicle as part of the Deep Transport Limited fleet, such use being unauthorised and he was instrumental in the unlawful use of other vehicles even after the public inquiry before the Deputy Traffic Commissioner.  There is little, if any doubt, that he was the controlling mind of Deep Transport Limited when he was disqualified from acting in such a role. Taking all those matters into account, a period of 4 years disqualification was also justified and proportionate in his case.

16.	In the result, these appeals are dismissed.

Her Honour Judge Beech
22 January 2013