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Freight

Decision for DIRECT FREIGHT (KELVEDON) LTD, SYLVIA JOAN BUTCHER t/a KELVEDON VEHICLE HIRE AND AJ LOGISTIC SERVICES LIMITED

0.1 IN THE EASTERN TRAFFIC AREA

1. DIRECT FREIGHT (KELVEDON) LTD – OF1136551

AND

2. SYLVIA JOAN BUTCHER t/a KELVEDON VEHICLE HIRE – OF1086550

AND

3. AJ LOGISTIC SERVICES LIMITED – OF2046594

4. TRAFFIC COMMISSIONER’S WRITTEN DECISION

5. Background

Direct Freight (Kelvedon) Ltd holds a Standard International Goods Vehicle Operator’s Licence authorising ten vehicles and seven trailers. One of the Directors is Stephen Richard Jordan. There is no Transport Manager currently listed on this licence, following the departure of David Victor Butcher. David Victor Butcher trading as Direct Freight held licence OF0220179 until it was revoked from 7 December 2021. The Companies House register records that he was the sole Director of this operator until 5 August 2021 (DF page 48). The Companies House record suggests that Sylvia Butcher was appointed as a Director (DF page 46) on 21 March 2022. Ms Evans confirmed that appointment. In evidence, Mrs Butcher described that appointment as a mistake by the accountant. I compared that with her control of the company’s accounts. She has now been replaced by her grandson, Toby Kemp, although various submissions suggested that he was too young to assume control. In the words of Mr Jordan: they are ‘not really joint Directors’.

An application seeking to increase authority to fifteen vehicles was lodged on 11 March 2021. There were subsequent applications made to nominate Stephen Richard Jordan to act as Transport Manager lodged on 19 August 2021 and 17 November 2021.

There is one Operating Centre at OTEC (GB) Ltd, Critall Road Industrial Estate, Critall Road, Witham CM8 3DT. The office for all the businesses is located at Unit 6, which backs onto the Operating Centres for Direct Freight (Kelvedon) Ltd and Mrs Butcher. There is an interconnecting gate. Preventative Maintenance Inspections are said to be carried out in house at 6-weekly intervals. It was telling that Mrs Butcher intervened when I asked questions of Mr Jordan. This was changed to Hanson’s in September 2021. The response on the missing mileage also referred to Scania and Volvo, which are used for occasional work.

Sylvia Joan Butcher holds a Goods Vehicle Operator’s Licence authorising ten vehicles and five trailers. There is no Transport Manager currently listed on this licence following the departure of David Victor Butcher. An application was lodged on 3 January 2022 seeking to nominate the operator to that position. She gained her Certificate of Professional Competence on 25 October 2021.

There are two Operating Centres: OTEC (GB) Ltd, Elmbeck Logistics Centre, Critall Road, Witham CM8 3DT and Naval House, Kings Quay Street, Harwich CO12 3JJ. Preventative Maintenance Inspections are said to be carried out in house and by MC Group Ltd, at 6-weekly intervals. I was told that this had changed in January 2022 so that Hanson’s use ‘our’ workshop.

Ms Evans refers to three licences in possession at the time of the investigation: David Victor Butcher (Sole trader) TA Direct Freight (OF0220179). In late September 2005, Mr Butcher apparently applied to move Operating Centre to OTEC (GB) Ltd which was granted, to co-locate with his customer; Direct Freight (Kelvedon) Ltd (OF1136551), which had been incorporated on 31 January 2013 by Ela Shah, with Mr Butcher taking appointment on 3 April 2013 and applying for this operator’s licence on the 25 February 2015; Sylvia Joan Butcher (Sole Trader) TA Kelvedon Vehicle Hire (OF1086550), who apparently had a business disagreement leading to that application in February 2009.

AJ Logistic Services Limited (OF2046594) seeks a Standard International Goods Vehicle Operators Licence authorising eight vehicles and eight trailers. The Director, Amelia Jane Kemp, has nominated herself to act as Transport Manager. She qualified in July 2021.

The applicant has proposed use of one Operating Centre at Unit 6, Critall Road, Witham CM8 3DE. In contrast to the existing operators, the vehicles will be parked at that address. The application proposes that MC Truck & Bus carry out Preventative Maintenance at 8-weekly intervals. Addresses used by the applicant have been linked to OF1136551 Direct Freight (Kelvedon) Ltd, OF1086550 Sylvia Butcher, OF1057312 held by Joanne Elaine Kemp & Andrew Peter Kemp, and OF0220179, which was held by David Victor Butcher until it was revoked.

6. Hearing

The Public Inquiry was listed for today, 4 May 2022, in Tribunal Room 1 of the Office of the Traffic Commissioner in Cambridge. Direct Freight (Kelvedon) Ltd were present in the form of Mr Jordan. Sylvia John Butcher was also present, and both were represented by Carolyn Evans of CE Transport Law and AJ Logistic Services Ltd was present in the form of Ms Kemp, represented by Tim Ridyard of Ashtons Legal.

7. Issues

The Public Inquiry was called at the request of the operators and following notice that I was considering grounds to intervene in respect of the licence held by Direct Freight (Kelvedon) Ltd and specifically by reference to the following sections of the Goods Vehicle (Licensing of Operators) Act 1995:

  • 26(1)(b) – condition to notify matters which affect good repute and professional competence

  • 26(1)(c)(iii) – prohibitions (DF pages 530-537)

  • 26(1)(ca) – fixed penalty notices (DF pages 451-452)

  • 26(1)(e) – statement that the nominated transport manager would meet the statutory duty, and the operator would comply with conditions

  • 26(1)(f) – undertakings (that vehicles and trailers would be kept fit & serviceable; and would not be overloaded (pages 538-540); that the rules of drivers’ hours and tachographs would be observed)

  • 26(1)(h) – material change:

  • 27(1)(a) – good repute, financial standing, professional competence.

and in respect of the licence held by Sylvia Joan Butcher, sections:

  • 26(1)(b) – condition to notify matters which affect good repute and professional competence

  • 26(1)(c)(iii) – prohibitions (SB pages 476-483)

  • 26(1)(e) – statement that the nominated transport manager would meet the statutory duty, and the operator would comply with conditions

  • 26(1)(f) – undertakings (that vehicles and trailers would be kept fit & serviceable, that the rules of drivers’ hours and tachographs would be observed)

  • 26(1)(h) – material change:

  • 27(1)(a) – good repute, financial standing, professional competence.

Direct Freight (Kelvedon) Ltd nominated Stephen Richard Jordan to act as its Transport Manager. The hearing allowed the operator to pursue this application under Schedule 3 and to satisfy me that the requirements for good repute, a certificate of professional qualification and the ability to exercise effective and continuous management are met. Ms Evans communicated in writing that the application to increase the vehicle authority cannot succeed in light of the accepted use of 5 vehicles specified on the sole trader licence by that entity.

Mrs Butcher nominated herself to act as her Transport Manager. The hearing allowed the operator to pursue this application under Schedule 3 and to satisfy me that the requirements for good repute, a certificate of professional qualification and the ability to exercise effective and continuous management are met.

AJ Logistic Services Ltd was given opportunity to pursue its application and to satisfy me that the statutory criteria were met and in particular, by reference to the following sections:

  • 13A(2)(b) – repute

  • 13A(2)(c) – financial standing

  • 13A(2)(d) – professional competence by reference to Schedule 3 and the statutory duty, so as to meet the requirements of section 13C.

The operators were directed to lodge evidence in support by 20 April 2022, and the applicant by 27 April 2022, including financial, maintenance and other compliance documentation. In order to assist the operators, the Office of the Traffic Commissioner randomly selected vehicle registration marks from the specified vehicle list so that records could be dip sampled. In an email dated 25 April 2022, Ms Evans indicated that Sylvia Butcher was unable to provide records relating to GN14 SOE as it was said to have been involved in an accident on 16 July 2021 (removed 17 November 2021) and was then taken off the road. It was also said that FJ57 AEG was taken off the road in October 2021 (removed 18 November 2021) as it proved uneconomical to repair. In an email of 26 April 2022, Mr Ridyard indicated that the applicant Director was absent from the country from 18 to 28 April 2022, having rearranged a holiday so as to attend the hearing. Mr Ridyard gave notice of the evidence to be lodged on behalf of the applicant, it was not received by Friday, 29 April 2022. A photograph of a bank statement covering 22 March to 21 April 2022 was lodged.

The start of the Public Inquiry was substantially delayed due to the late provision of financial evidence. Financial evidence submitted on behalf of Direct Freight (Kelvedon) Ltd referred to two Barclays accounts for the period of 22 January to 22 April 2022. An average of those accounts was not sufficient to support one vehicle. An additional unverified printout for one of those accounts, for a different period (25 April to 3 May 2022), purports to show a closing balance to meet the prescribed sum. Mr Jordan also supplied two statements for the same Barclaycard for May and September 2021. Mr Butcher continues to make regular and recent payments into the company account.

In addition, some further original ‘statements’ were received for another account in the name of ‘Direct Freight’ from Santander. Those are not full statements and only the account summaries have been provided. I was only then told that this evidence is relied upon by Mrs Butcher. I was told that Mrs Butcher had returned from holiday on 28 April 2022, so she was unable to resolve the lack of full statements with account summaries having been supplied. I also received original statements for an HSBC account in the name of Mr DV Butcher and Mrs SJ Butcher trading as Kelvedon Vehicle Hire for 18 January to 18 April 2022. There was no statutory declaration provided and, in any event, Mr Butcher is the subject of a current disqualification. Mrs Butcher suggested that attempts had been made to remove Mr Butcher’s name two years ago, but his ill-health had prevented this. I compared that with the dates of the offences said to have been committed by Mr Butcher. I therefore disregarded that excuse. Mrs Butcher told me that Mr Butcher had never tried to access the account. The reasons for that became evident during the hearing, as it is Mrs Butcher who has control of bank accounts for both operations.

I heard evidence, particularly on behalf of Direct Freight (Kelvedon) Ltd that, whilst all debts were settled promptly by the operator(s), customers were permitted up to 60 or 90 days to pay, which had led to a cash flow issue. This state of affairs had been inherited from Mr Butcher but had not been addressed. It was suggested that going forward Mr Jordan would be in a position to address it. For the reasons outlined below, I remained to be satisfied that there was a reasonable prospect of financial standing being shown by either operator. I also noted the time since Mr Donaldson’s intervention and was concerned that the operators should not be seen to gain a commercial advantage over other operators. For the reasons set out I did not find it appropriate to allow a Period of Grace to resolve this mandatory requirement.

8. Summary of Evidence

Traffic Examiner, Ian Donaldson, conducted the investigation into three linked operators, Direct Freight (Kelvedon) Ltd – OF1136551, Sylvia Joan Butcher t/a Kelvedon Vehicle Hire – OF1086550, and David Victor Butcher t/a Direct Freight – OF0220179. He noted that at that time David Butcher was the Transport Manager for all three licences. Mr Butcher is the husband of Sylvia Butcher and was the sole Director of Direct Freight (Kelvedon) Ltd. He commenced his inquiries by requesting drivers’ hours records and driving licence checks for July, August, September 2020 and subsequently by reference to the statutory powers under section 99ZA of the Transport Act 1968. That data was subsequently supplied via a transport consultant, Mr Farrar. Mr Donaldson’s findings are set out in his report, which is replicated in the bundles for both existing operators (DF pages 55-438 and SB pages 47-430).

The Case Summary usefully bullets the relevant findings and Mr Donaldson’s supplementary statement of 26 April 2022, corrects an error:

Direct Freight (Kelvedon) Ltd:

  • Victor Walter Jefferies – entitlement expired on 2 June 2020 but drove on 21, 24, 30 and 31 July 2020.

  • David Victor Butcher did not hold a Category C1, C, or C&E entitlement but drove on 29 July 2020; 3, 6, 7, 17, 19 August 2020 and 9 September 2020.

  • Stephen Barry Nelson exceeded drive limit by 3 hours and 16 minutes on 15 July 2020 and 36 minutes on 20 July 2020

  • Malcolm John Bearcroft exceeded drive limit by 2 hours and 43 minutes on 2 July 2020 and 46 minutes on 20 July 2020.

  • David Victor Butcher exceeded drive limit by 1 hour 10 minutes on 7 August 2020.

  • DX57 EHS driven on 3 July 2020 with no card inserted for 10 minutes and 2.1 km

  • SB63 VHR driven on 24 July 2020 with no card inserted for 15 minutes and 8 km

  • SB63 VHR driven on 4 August 2020 with no card inserted for 25 minutes and 11 km

  • GK58 UMR driven on 24 July 2020 with no card inserted for 2 hours and 29 minutes and 170 km

  • GK58 UMT driven on 3 September 2020 with no card inserted for 10 minutes and 2km.

David Victor Butcher’s sole trader licence:

  • David Victor Butcher did not hold a Category C1, C, or C&E entitlement but drove on 16 September 2020 and 1 October 2020.

  • David Victor Butcher’s break on 2 July 2020 was short by 1 hour 56 minutes

  • David Victor Butcher’s exceeded drive limit on 2 October 2020 by 1 hour 17 minutes.

  • BD60 ELV driven on 10 July 2020 with no card inserted

  • S1 KVH driven on 25 July 2020 with no card inserted

  • EU08 EKK driven on 29 July 2020 with no card inserted

  • N20 BME driven on 21 August 2020 with no card inserted

  • N20 BME driven on 1 September 2020 with no card inserted

Sylvia Joan Butcher’s sole trader licence:

  • David Victor Butcher did not hold a Category C1, C, or C&E entitlement but drove on 17 September 2020.

  • David Victor Butcher exceeded drive limit by 2 hours 34 minutes.

  • EU57 HFP driven on 3 July 2020 with no card inserted

  • FJ57 AEG driven on 14 July 2020 with no card inserted

  • RX54 GGZ driven on 15 July 2020 with no card inserted

  • EU57 HFP driven on 3 August 2020 with no card inserted

  • FJ57 AEG driven on 6 August 2020 with no card inserted

  • FJ57 AEG driven on 25 August 2020 with no card inserted

  • EU57 HFP driven on 27 August 2020 with no card inserted

  • FJ57 AEG driven on 3 September 2020 with no card inserted

  • EU57 HFP driven on 21 September 2020 with no card inserted

  • EU57 HFP driven on 25 August 2020 with no card inserted.

The Traffic Examiner was prompted to request further information under cover dated 10 December 2020. The response dated 15 December 2020, led the Examiner to comment that disciplinary records had only been produced on 12 December 2020. Written representations accept that these represent serious failings. In cross-examination, Mr Donaldson commented on the confusion around the extension of driving entitlements during the pandemic and accepted that the criticisms surrounding Mr Jeffries’s entitlement should be withdrawn.

The response to the shortcomings, dated 9 March 2021, was drafted by Carolyn Evans of CE Transport Law Ltd (DF pages 327 to 331, SB pages 319 to 323). That letter refers to some of the history to the various applications. It suggests that ‘due to an administrative error’ the sole trader licence held by David Butcher was not surrendered following grant of the licence to Direct Freight (Kelvedon) Ltd. It is admitted that operations continued and became blurred between the different legal entities with the company raising invoices and paying drivers. However, it suited Mr Butcher and he continued to operate a number of vehicles to service OTEC work, which were specified on the sole trader licence. Mrs Butcher also operates from the OTEC site as well as the site at Naval House. Ms Evans suggests that she was carrying out work for Mann & Son Ltd operating four vehicles but the total authority from November 2017 was seven vehicles and three trailers. It was admitted that the vehicles and drivers ‘have moved across to the limited company’.

It was further admitted that in 2020, Mr and Mrs Butcher had realised the need to amalgamate operations under the correct operating entity ‘for a sale’. Written representations from Ms Evans confirm that they intended to amalgamate the three businesses to operate under the umbrella of the limited company. It is suggested that they became distracted during the pandemic. It is suggested that ‘the company is now running twenty vehicles with twenty drivers employed’. It goes on to suggest that Mr Butcher wishes to retain the company for his grandchildren to take over and that he is looking for a replacement to take over from him. A transport consultant is assisting with an application to increase the vehicle authorisation of the licence held by the limited company. The intention is to surrender both the sole trader licences held by Mr & Mrs Butcher once the vehicle authorisation on the company licence has been increased. An application was lodged on-line on 11 March 2021 seeking to increase the company’s vehicle authorisation from 10 to 15. That was inevitably delayed by the matters summarised above.

The Case Summary refers to relevant extracts from the licensing record which show that Mr Butcher accessed the self-service facility on 11 August 2021 to remove himself as Director of Direct Haulage (Kelvedon) Ltd, to be replaced by Stephen Richard Jordan. Companies House suggests that the change of Directors was on 5 August 2021 and again on 21 March 2022. The Companies House register also records that Mr Jordan was a Director of Witham Truck Rentals Limited until 21 March 2022, whilst David Victor Butcher remains a Director of that company.

An email dated 18 November 2021 (DF page 109, SB page 439) from Mr Farrar communicated the following:

The sole trader licence held by David Victor Butcher OF0220179. Mr Butcher he says that because of his continuing ill health and at his doctor’s advice he is retiring from the industry, and will accept the Traffic Commissioners decision as set out in his letter dated 8 November 2021 to revoke the licence on 29 November 2021.

Sylvia Joan Butcher holder of the sole trader licence number OF 1086550 trading as Kelvedon vehicle hire, in response to a letter addressed to her also dated 8 November requests that the matters of concern be addressed at a formal hearing, Mrs Butcher says that she has herself now passed the transport managers examination and is now professionally competent, she says she has already applied to include herself as transport manager notifying the Central Licencing unit in Leeds with sight of her qualification certificates, She also confirms that her husband David Butcher has because of health issues retire from their businesses.

Direct Freight (Kelvedon) Ltd licence number OF1136551 at the instruction of the director Stephen Jordan, says that he is the sole director of the company and now also a shareholder, In response to the letter to the company dated 8 November 2021 notifying the company of the Traffic Commissioners intention to revoke the company’s licence, he formally requests that the Traffic Commissioner will call a hearing when he will have the opportunity to present the company’s case. Mr Jordan confirms that Mr David Butcher no longer takes any part in the company’s management and has formally retired.

An application to nominate Stephen Richard Jordan as the transport manager was made online on 19 August 2021. An email was received from David Butcher on 5 October 2021 confirming his resignation as the transport manager. A request was sent to Mr Jordan on 14 October 2021 for an amended TM1 showing the hours he will spend carrying out his role as director. The email also asked if he would accept an undertaking to attend a CPC refresher course. In an email dated 20 October 2021 Mr Jordan states that he will spend 38 hours as transport manager and 6 hours on his director role, he attached a signed undertaking and an amended TM1.

Correspondence dated 11 November 2021 explained that I remained to be satisfied that Mr Jordan could meet the statutory requirements and referred to the control of the company, with David Butcher remaining as the sole person of significant control. A further application, nominating Mr Jordan was made online on 17 November 2021. A certificate of attendance at an Operator Licence Awareness and CPC Transport Manager Refresher course on 28 October and 20 November 2021 was received. The TM1 shows no other employment. Mr Jordan has declared no other employment, but that has changed with his appointment as Director but I cannot reconcile that declaration with his earlier email of 20 October 2021. I asked about Mr Jordan’s appointment, which was confirmed by Mr Butcher. He was subsequently given shares in the company to cement the relationship but there was no payment for those shares. I was told that the remaining shares were transferred to Toby Kemp without payment. I was told that it was always the intention that the grandchildren would take over the company. I contrasted that with the representations suggesting that it might have been sold two years previously. It was suggested that I allow these two Directors to continue to benefit from the unlawful operations first identified by Mr Donaldson and which were allowed to continue to April 2022. The reality of who controls the company is set out below.

I considered the current position within the context of the previous failings. Ms Evans accepted the alleged and serious shortcomings put to Direct Haulage (Kelvedon) Ltd and to Mrs Butcher. It is accepted that, over a number of years, the operations had been run as one and that the breaches must be viewed in that context. Mr Donaldson’s supplementary statement of 26 April 2022 refers to the documentation received in advance of the Public Inquiry from Steve Jordan of Direct Freight (Kelvedon) Ltd

On driver licences, it is accepted that Mr Butcher had driven without the correct entitlement. It was accepted that Mr Butcher lost his entitlement 3 years before. DVSA records him driving on thirteen occasions between 29 July 2020 and 1 October 2020. Ms Evans refers to the driver shortage and claims that there was no alternative but Mr Butcher and therefore the operator(s) were aware that he did not have the entitlement and cannot have been insured.

Ms Evans referred to three of the twenty-five drivers who committed ‘significant drivers’ hours infringements’: Drivers Stephen Nelson, Malcolm Bearcroft and Mr Butcher himself, confirming that all entities were run as one. Even then it is claimed that the operator(s) produced infringement reports which they are invited to sign. However, the records from July 2020 were said to have been shredded as part of an office refurbishment.

On the missing mileage, Ms Evans admits the 455 instances of driving without a card. It is claimed that the majority were due to movements between ‘his yard and the operating centre, OTEC (UK) Limited’. I have referred to the difference in addresses in the background to the Operating Centres. The Operating Centre is said to back on to the freight forwarder’s premises. The letter also refers to movements to Scania and Volvo. Ms Evans refers to twenty-one occasions which DVSA suggested represents an attempt not to record driver activity. It is claimed that those instances accord with the vehicles being taken to annual test and on others due to congestion. I asked to see the driver endorsements, but none were available. The representations appear to argue against themselves when referring to agency drivers, calling into question why Mr Butcher was driving without an entitlement. I am unclear why steps would not have been taken by the operators to ensure that cards were not downloaded before they left the operator(s). It is admitted that they had not been analysing missing mileage. I also refer to the Examiner’s observations regarding the disciplinary records. This was identified by Mr Jordan after his appointment in 2021.

The operators were put on notice of my concerns under cover dated 8 November 2021 and referring to the potential consequences of the DVSA desk-based assessment. A similar letter was also sent to David Victor Butcher regarding his former role as Transport Manager. An email was received from Chris Farrar of Transport Help UK Ltd, dated 18 November 2021, confirming that David Butcher accepts the Traffic Commissioner’s decision to revoke his sole trader licence OF0220179. I was further advised that Mr Jordan is now a shareholder in the company, and he requested this Public Inquiry. A further letter was sent to Mr Butcher on 7 December 2021. In an email of 10 December 2021 Mr Butcher accepted that h

is repute was lost and that he should be disqualified. I subsequently directed on 15 December 2021 that he be disqualified from relying on his Certificate of Professional Competence for an indeterminate period.

It is claimed that driver licences are now checked quarterly, and that driver data is downloaded ‘regularly and sent to Tachomaster for analysis. I am referred to the company’s prohibition rate of 12.5%. However, the last encounter at Doxey Weighbridge on 21 March 2022 suggests a failure in driver defect reporting and maintenance, with several warning lights illuminated. The last recorded overloads date back to December 2020, when the country was subject to pandemic restrictions. I was concerned to note the failure at annual test on 9 December 2021 where the service and parking brake performance of AY08 FBD did not meet the minimum standard. Sadly, Mr Jordan could not recall the circumstances. I was also concerned by his apparent inability to manage the haulage of foreign based trailers with work obtained through the Easyroad forwarder. There was no appreciation of the need to ensure compliance with the requirements of this operator’s licence with sole reliance on driver walk rounds. Mr Jordan failed to even bring any example of the driver inspection records. I was unimpressed by the suggestion that the operator did not know enough about its own operations to realise that this would be relevant.

Mrs Butcher has a prohibition rate of 13.79%. The last mechanical intervention is of some age now, although reference is made to a tachograph offence on 6 January 2022. This was confirmed at the hearing to relate to the expired calibration of the unit fitted to GK58 UMT. Annual test failures are recorded against her licence dating to 1 February 2022 and on 12 January 2022 there is reference to a failure in brake systems and components. The representations in March 2021 accept that the operations were effectively run as one. Mrs Butcher’s appointment as a Director of Direct Freight (Kelvedon) Ltd was not notified promptly. I considered her licence and her application to be added as a Transport Manager in that context. I also noted the suggestion from the applicant’s Director, Ms Kemp that the applicant ‘will initially and gradually take over’ the operations of Sylvia Butcher.

Written representations suggest that Mr and Mrs Butcher ‘immediately’ began to regularise the legal position leading to the application by Direct Freight (Kelvedon) Ltd dated 11 March 2021 to increase the vehicle authority to 15 vehicles. Ms Evans points to the application at page 439. That application confirms knowledge on the part of Mrs Butcher, that operations (behind the front of her licence) should have ceased. The email correspondence confirms the plans. There appears to be some implied criticism that there was no response. Any doubt as to the responsibility for legal compliance would further reflect adversely on the operators. It was in this context that Mr and Mrs Butcher began to look for a General Manager, leading to the recruitment of Mr Jordan. The representations indicate that he was known to them through Mann & Son (London) Ltd, i.e., Mrs Butcher’s main customer.

It was apparently agreed that Mr Jordan would have ‘full control’ of the business as Transport Manager and Director. Ms Evans made valiant efforts to persuade me that Mr Jordan fulfils that role, but he does not see the bank accounts. Mrs Butcher is the signatory for the company account. Mrs Butcher suggested that this was something to do with the closure of branches. I accept Mr Jordan’s explanation that this is how ‘the family’ controls its interests. The extent of Mr Jordan’s authority is to say whether an invoice should be paid. He cannot actually action that payment. I view his role in the continued unlawful operation in that context, but he must accept responsibility for the representations suggesting that he was exercising the functions of a statutory company director. It helps to explain why he did not see the earlier reports supplied by Mr Donaldson. It was only after he sat down with Mrs Butcher that she started invoicing for work which had previously been invoiced by Direct Freight (Kelvedon) Ltd. Mr Jordan asked me to accept that he did not have access to the previous records and, in his words, ‘they didn’t tell me’. It remains the case that he was not in a position to secure those records or obtain a clear picture of what had occurred. He told me that he did not immediately appreciate the issue with the missing mileage, but even with his limited financial control, he must have been aware of the invoicing. He accepted that he allowed continued operations behind the front of Mrs Butcher’s licence.

Ms Evans lodged written representations shortly in advance of the hearing. Ms Evans confirmed Mr Butcher’s intention to surrender his sole trader licence at the time when Direct Freight (Kelvedon) Ltd applied for its licence, as stated on the application form (page 35). That did not happen. It is also admitted that Mrs Butcher operated under her licence but in recent years permitted the limited company to operate behind that front using vehicles specified on her licence. Ms Evans refers to the loaning of those sole trader licences. The claim that they did not appreciate the significance or seriousness of this only confirms the grounds to question the ability to hold a licence. It is a long-established principle, since the decision in 2012/030 MGM Haulage & Recycling Ltd, that an operator can be taken to be aware of published guidance. It is admitted that ‘even after the maintenance investigation and revocation of Mr Butcher’s sole trader licence, the limited company has continued to use four of the vehicles which are specified on Mrs Butcher’s sole trader licence on a regular basis’. It is claimed Mrs Butcher had not appreciated that this was an issue. The claim does not stand up to scrutiny not least because of her involvement in the future business planning. The admission that ‘the vehicles were used as a necessity whilst waiting for the increase in vehicle authority on the limited company licence’ disclose the true intent, where commercial opportunity was placed above compliance.

It was submitted that ‘since the investigation the family have sought to regularise the legal position’. That provided further confirmation of a blurring of operations and future intentions. Mrs Butcher was even appointed to the Board of Direct Freight (Kelvedon) Ltd. That was withdrawn in the lead up to the Public Inquiry and she described it as a mistake and yet she has had that same financial authority. Mr Jordan’s nomination was put on the basis of a commitment of 38 hours as Transport Manager and 6 hours on Director duties. He undertook CPC refresher training in November 2021. The application form was amended to reflect the above, with accompanying certificates of attendance now supplied. He was put on notice of my concerns in correspondence dated 11 November 2021. I had already noted that the financial evidence submitted by Mrs Butcher indicates that Mr Butcher continues to be involved in the ‘Kelvedon Vehicle Hire’ business.

Mr Jordan pointed to the systems, which he has implemented since August 2021. I was referred to maintenance files, driver’s hours compliance etc. I was told that inspections for Direct Freight (Kelvedon) Ltd were previously carried out by a Mr Gutteridge of Braintree Car & Commercial, using handwritten forms. He has been retained to conduct the pre-annual test checks, but the remainder of inspections are undertaken by Hanson’s, using the R2C system. The roller brake test is conducted at alternate intervals. I was not supplied with a satisfactory explanation for departing from the starting point described in the Guide to Maintaining Roadworthiness. I was told that the roller brake print out is supplied in hard copy although the system described appeared to be quite dated. The representations identify that these have been undertaken in an under laden condition. The operator relies on the correspondence from DVSA at its Appendix 1. Vehicles are said to be inspected every six weeks and trailers at eight, with Volvo on a 24-hour call-out, and a mobile fitter (RTT) available for running repairs at the Operating Centre. The operator can provide no Preventative Maintenance Inspection forms prior to the appointment of Hanson’s as these have not been retained. Mr Jordan was appointed in August 2021, but I was told that he concentrated on other compliance issues, despite there being no brake performance checks. Mr Jordan was told that records had been shredded as part of an office move, but there was no attempt to notify my office.

From a dip sampling of AY08 FBD specified on the Direct Freight (Kelvedon) Ltd licence, I make the following observations: at least invoices are now addressed to ‘Direct Freight Ltd’ as opposed to that and David Butcher. The vehicle was specified on 2 May 2015 but no records before 2019.

  • 26 March 2022 – inspection with no apparent brake performance test, recorded tilt pipe leaking again, with Nil driver defect report for 25 March 2022.

  • 12 February 2022 – inspection with no apparent brake performance test, recorded tilt pipe leaking, with Nil driver defect report for 11 February 2022

  • 28 December 2021 – inspection with no apparent brake performance test, recorded wing spray suppression with driver defect report for broken mudguard on 15 November 2021, which also mentions floor bed cracked again

  • 20 November 2021 – inspection with no apparent brake performance test, recorded wing damaged and bumper condition with driver defect report for broken mudguard on 15 November 2021, which also mentions floor bed cracked

  • 9 October 2021 – inspection with no apparent brake performance test.

I add that on 8 April 2022 – Y7 REF roller brake test, shows no test weight – 53%, 29%, 24% and 37% imbalance on axle one on the offside service brake; GK58 UMR shows no weight at test – 40% and 34% but no test of secondary brakes. Mr Jordan agreed that this should have been detected. The driver defect reports which have been provided do not appear to cover the full period requested. The company operates mainly rigid vehicles although there was an absence of trailer reports. Mr Jordan told me that he carries out checks on paperwork at the weekends but admitted that some defects are reported directly to the workshop.

I refer to vehicle S1 KVH, which was specified on Mrs Butcher’s licence. The files for this licence were submitted at the same time as for the company licence.

  • 5 March 2022 – inspection but no brake performance test.

  • 22 January 2022 – inspection with no brake performance check. The inspection form refers to Kelvedon Vehicle Hire.

  • 12 January 2022 – presented for annual test under Direct Freight (Kelvedon) Ltd.

  • 4 December – inspection with no brake performance check.

  • 23 October 2022 – inspection with no brake performance check and submitted by Direct Freight (Kelvedon) Ltd. It records leaking air pipe in the chassis.

  • 7 September 2022 – inspection with no brake performance check and submitted by Direct Freight (Kelvedon) Ltd.

This is indicative of the maintenance approach and coincides with my observations on FJ57 AEG and EJ15 ORZ. Hansen Commercials appears to be under the impression that items 71, 72 and 73, i.e., brake performance, are not applicable.

The representations described how Tachomaster has been retained to produce infringement reports, which are checked at interview on a Friday with either Mr Jordan or Mrs Butcher, illustrating how the operations are run. I was referred to a bonus scheme. It is accepted that the issues disclosed by raw data supplied to Mr Donaldson, namely that missing mileage, is only now being addressed. This is apparently blamed on agency drivers, which I was told in evidence had now been addressed. I was told about the intended use of the DOT system, but it is not comparable with GK58 UMZ. Mr Jordan sought to persuade me that there has been a gradual improvement in both drivers’ hours and maintenance since August 2021, so that the operator’s licence of Direct Freight (Kelvedon) Ltd be allowed to continue. The representations confirmed the continued use of vehicles specified on Mrs Butcher’s licence up to 11 April 2022. That reflects on both Mr Jordan and Mrs Butcher, who sought to persuade me that they could act as Transport Managers for the relevant operations.

Mr Jordan quite properly refers to his position as Managing Director of Direct Freight (Kelvedon) Ltd. He says that he was completely unaware of this issue until taking professional advice. I do not understand why, when he has held a Certificate of Professional Competence since June 1998, and which he now seeks to rely on. The Senior Traffic Commissioner’s Statutory Documents have been in circulation since 2011. It is simply not credible to suggest that operation of the named vehicles by Direct Freight (Kelvedon) Ltd would have been missed by any Managing Director exercising basic scrutiny. I accept that Mr Jordan was only appointed in August 2021 but vehicles GK58 UMT (driven by Leon Davis), S1 KVH (Melvin Eastall), EG15 0RZ (Stephen Nelson and which was added to the company licence after 11 April 2022) and NX65 LKF (Gwithion David Ng-Hider), were specified on Mrs Butcher’s licence at the time. Mrs Butcher’s operation continued to service GFC (i.e., what was formerly OTEC) Palletwise and other general haulage. Mrs Butcher confirmed that she paid Drivers Stuart Gouldthorpe, Matthew Palmer, Dawn Onions, Richard Faulkner, Marius Balaur, Mohamed Laktib. I contrasted the number of drivers with the number of vehicles which were operated by her minus those used by the company.

8.1 The application

In the absence of any obvious previous experience, the applicant was required to satisfy me of good repute and by reference to the fitness of its Director and ability of the nominated CPC holder to meet the statutory duty and the requirement for professional competence.

The applicant is required to provide financial evidence over the last 28 days to support the application. Financial evidence submitted in support of the application (AJ page 60) showed four deposits totalling £40,000 into the business account, from ‘Kemp Amelia’, which enabled the company to meet the financial requirement for this application. The applicant director suggested that this represented a personal investment, but then failed to respond to requests for further details.

This was developed in the statement of Amelia Kemp dated 29 April 2022, in which she confirms the transfer of capital of £40,000 into her personal bank account, which she transferred into the company bank account in four sums of £10,000 (the maximum transfer permitted). Immediately prior to the hearing, Ms Kemp supplied copies of statements from her personal account which shows the original source of those funds as Direct Freight Ltd which made a single payment on 25 May 2021. Mrs Butcher confirmed in evidence that this was payment from Direct Freight (Kelvedon) Ltd, which had been discussed with her. I was not initially clear why she would have been involved but that became clearer during the evidence which confirmed her close involvement.

The applicant Director initially claimed that there were no links between her and the other entities (25 February 2022, AJ page 50) except for “renting an office and parking”. The Operating Centre is on land owned by Jim Welch. As indicated above, the administration building has separate offices. Her office was said to be ‘completely separate to that of Direct Freight (Kelvedon) Limited or that of Sylvia Butcher’. In evidence I learned that she is paying no rent and that this is paid for by Direct Freight (Kelvedon) Ltd.

Ms Kemp confirmed in a letter dated 22 March 2022 (AJ pages 58 and 59) that David and Sylvia Butcher are her grandparents. Her brother, Toby Kemp is a person of significant control for Direct Freight (Kelvedon) Ltd and replaced David Butcher as from 18 November 2021. The initial evidence covered 1 April to 21 July 2021. The same account was used to submit evidence from 22 March to 21 April 2022.

The statement confirmed an absence of operator licence experience. The statement refers to her education and that, whilst at school, she helped her grandparents, David and Sylvia Butcher, ‘in their transport office’, for which she was paid. This involved invoicing and preparing accounts and inputting ‘their VAT’. She continued to work for her grandparents whilst studying at Colchester Institute including the downloading of driver digi-cards. When she left college, she continued to work for her grandparents on a part-time basis.

Ms Kemp referred to the applicant company having traded, operating a transit panel van undertaking deliveries for a customer, GFC. She stated that she had generated sufficient income over the last year to purchase a rigid vehicle and two tractor units.

Ms Kemp refers to her holding a Certificate of Professional Competence. I was assured that the application is not linked to other family businesses or dependent on them as she wishes to operate in her own right. Joanne and Andrew Kemp were described as distant relations with no connections to any of the operator’ licences held by the other family members. She does not intend to employ family members or ask them to be involved in management. Nevertheless, it was admitted that, with her grandmother’s anticipated retirement in 12 months, she may assume some of her work or vehicles.

Ms Kemp stated that she had challenged David Butcher on his poor management. Part of her job was to print off infringement sheets. She felt that her grandfather was not prepared to tackle drivers on their infringements, which felt like an administrative exercise rather than tackling their mistakes. Her grandfather challenged her in return to pass the Transport Manager CPC. He promised to support her financially, so that she could set up her own transport company. She described the course as an eye-opener and in contrast to the way her grandfather operated. She initially failed the case study but retook this part in June 2021 and passed. She held her grandparents to the promise to support her and she informed them that she would operate separately when she applied for an operator’s licence in 2021. She repeated the commitments made when she lodged that application. However, she also referred to her recent role ‘inputting and outputting, working out running costs of the vehicles, downloading driver cards, and dealing with driver problems where necessary’. She confirmed employment with Sylvia Butcher and Direct Freight (Kelvedon) Ltd. She suggests that she receives separate weekly salaries (using Mrs Butcher’s trading name), but there was no formal division of time. This further confirmed for me that the operators were aware of the need to keep the businesses separate. Ms Kemp confirmed that she would cease this work for them if this licence were granted and will concentrate solely on her business. She also corrected an error in the application form regarding the commitment of hours.

Ms Kemp stated that she plans to undertake general haulage for GFC, including long-distance work. The applicant intends to use its own vehicles and drivers initially but that she might take work from her grandmother after she retired. The business plan does not depend on that. She described this as a ‘fresh start’. So, vehicles will operate Monday to Friday with some occasional Saturday work. She will advertise for her own drivers and referred me to terms and conditions of employment, supported by disciplinary processes. I was assured that they will be employees. They will be subject to an induction process. She intends to employ a bonus system to incentivise compliance amongst the drivers. Driver licences will be checked quarterly and will be checked with DQCs and CPC hours. She intends to use the DOPT system to manage drivers’ hours. That allows driver cards and vehicle units to be downloaded remotely and provides instant access to data such as “missing mileage”. Any infringement reports will be issued on Friday mornings, but the DOT system has automatic alerts for the operator to notify infringements. Vehicles will be tracked.

I was initially concerned by the reference to Hanson’s because of the approach to items 71, 72, 73 on the Preventative Maintenance Inspection forms, which I have noted above. However, I was referred to the contract with Mr Gutteridge of Braintree Car & Commercial (two hundred yards away) and that Volvo or Scania will be used for roller brake tests. Ms Kemp was alive to the criticism of Mr Gutteridge’s handwriting, which was raised by Direct Freight (Kelvedon) Ltd. She outlined how she intends to plan for maintenance and other relevant events. The contractors will use inspections sheets produced by Novadata, which will be returned ‘promptly’. Drivers will report defect using RHA produced duplicate books, which will be checked and audited by Ms Kemp.

Ms Kemp states that the application is unconnected to the other entities or the fact that they are called to Public Inquiry. The apparent reluctance to provide a formal bar on other family members becoming involved in the running of my business was not carried on into her evidence with a commitment to a further finance review, were that required. Ms Kemp fully accepted that this may not allow for her company to take over the goodwill or vehicles from Mrs Butcher’s operation. She indicated that she would be content for the grant of a smaller authorisation for four vehicles and four trailers.

9. Determination

It was suggested that I could trust Ms Kemp as she was entirely separate from the business interests of other members of her family. However, the evidence did not support that assertion. I accepted that she had demonstrated the ability to take a robust approach to non-compliance by her grandfather, David Butcher, but it remained the case that she was entirely reliant on another of the connected entities for provision of the proposed Operating Centre and that financial standing relied on a gift, said to have been provided by her grandparents but was actually paid from the bank account of Direct Freight (Kelvedon) Ltd. Financial standing is not only a mandatory but also a continuing requirement. There may have been an attempt to repay that sum on 11 April 2022, but the potential seriousness of the situation was not lost on either advocate. Ms Kemp offered to abide by a condition restricting the involvement of other family members. That required her to investigate separate arrangements with the owner of the Operating Centre and establishment. I therefore allowed the applicant further opportunity to address these issues by holding the application in abeyance for 21 days from the date of the hearing.

Based on the evidence above, I am satisfied that I can and should record the following adverse findings: against Direct Freight (Kelvedon) Ltd under sections 26(1)(b), 26(1)(c)(iii), 26(1)(ca), 26(1)(e) – statement that the nominated transport manager would meet the statutory duty, and that the operator would comply with conditions, 26(1)(f) – undertakings (that vehicles and trailers would be kept fit & serviceable; and would not be overloaded; that the rules of drivers’ hours and tachographs would be observed), 26(1)(h) – material change in the availability of finance and a lack of Transport Manager; and against Sylvia Joan Butcher, sections 26(1)(b) – condition to notify matters which affect good repute and professional competence, 26(1)(c)(iii), 26(1)(e) – statement that the nominated transport manager would meet the statutory duty, and the operator would comply with conditions, 26(1)(f) – undertakings (that vehicles and trailers would be kept fit & serviceable, that the rules of drivers’ hours and tachographs would be observed), 26(1)(h) – material change in the availability of finance and a lack of Transport Manager. Both those operators were put on notice of my intention to make those findings and yet required a Public Inquiry, without discernible response to many of the alleged shortcomings.

The Senior Traffic Commissioner’s Statutory Document No. 1 refers to the relevant cases law; at paragraph 59, it states that loaning a disc is a serious matter, by reference to 2000/015 D Murphy trading as Ashley Coaches, 2010/084 & 086 Coach Express Ltd & Others. That allows operations to operate without scrutiny: 2011/034 Utopia Traction Ltd explains that ‘Fronting’, where a person, partnership or company, which does not have an operator’s licence, uses the operator’s licence held by another entity to conceal the fact that they are behaving in a way which requires them to have an operator’s licence of their own, is considered to be serious. Fronting deprives the traffic commissioner of the opportunity to oversee an ‘operator’. ‘Fronting’ is aggravated and very much more serious where it is apparent that the entity hiding behind the legitimate ‘front’ would be unlikely to obtain or would be debarred from holding their own operator’s licence. The Upper Tribunal has given clear guidance that evidence of fronting can, on its own, provide justification for deciding that the operator being used as a ‘front’ has lost its good repute.

I also refer to the appeal in 2012/071 Silvertree Transport Ltd, which provides a further definition: ‘fronting’ occurs when appearances suggest that a vehicle, (or fleet), is being operated by the holder of an operator’s licence when the reality is that it is being operated by an entity, (i.e. an individual, partnership or company), which does not hold an operator’s licence and the manner in which the vehicle is being operated requires, if the operation is to be lawful, that the real operator holds an operator’s licence. In which circumstances the traffic commissioner is entitled to take a serious view of such conduct.

Following the hearing of the evidence, it was accepted by Mrs Butcher that she would not be allowed to continue in the industry. I can at least give her credit for that. Her actions led me to not only conclude that she is unlikely to comply with the operator’s licence in future but that she must be removed from the industry in the interests of consistent application of the rules and in fairness to other responsible operators. She was actively involved in Mr Butcher’s decisions and then allowed fronting to continue even after I had taken steps against her husband. Her role in Direct Freight (Kelvedon) Ltd is to continue to protect the interests of the Butchers regardless of the operator licensing requirements. She cannot be trusted to act as an operator. For the avoidance of doubt, I would not be minded to accept her as a Transport Manager even if that application had been pursued. I therefore record formal findings that the operator no longer meets the mandatory requirements for financial standing or professional competence. She must be removed from the industry, and I record that she has lost her repute. All findings are made under section 27(1)(a). She asked for time to attend to the interests of long-serving employees, but I can allow no more than 23:45 on 24 June 2022, for a safe run down

I have considered whether to disqualify Mrs Butcher, under section 28 of the 1995 Act, from holding an operator’s licence in the future and by reference to the same factors as described above. In deciding upon the length of the disqualification, I have taken account of Statutory Guidance Document 10. This suggests a starting point of between one and three years for a first public inquiry. Taking account of Mrs Butcher’s involvement in decisions with Mr Butcher, and that unlawful operation continued even after DVSA intervened, I have given serious consideration as to whether her actions suggest a higher starting point. I cannot disqualify her as a Transport Manager, as she was not appointed as such, but for the reasons already explained and to protect the integrity of the licensing system, I do disqualify her from holding or applying for an operator’s licence or seeking to be involved in its management for a period of three years.

Direct Freight (Kelvedon) Ltd accepts that this case falls into the ‘severe to serious’ starting point suggested in the Senior Traffic Commissioner’s Statutory Document No. 10. It is accepted that that there have been persistent operator licence failures with inadequate response. Indeed, it would be difficult to reach a different conclusion on the above evidence. That presents the possibility of serious intervention, including revocation. Ms Evans sought to persuade me that this was not a case where there had been deliberate or reckless acts that compromised road safety or gave the operator a clear commercial advantage. I am afraid I am not persuaded by that argument, particularly following the failed application by Mr Butcher in 2008, the failure to surrender that sole trader licence, the continued use of Mrs Butcher’s sole trader licence by the company even to shortly before the Public Inquiry. It has directly led to a position where the company employed fourteen people and turnover was £1.5 million during the last year. That is what Mr Jordan and Mr Kemp seek to benefit from.

The written representations accept that the shortcomings at the time of the investigation were serious. Where I disagree is the extent to which those shortcomings were permitted to continue. It was stated that Mr Jordan accepted the position on the understanding that he would have complete autonomy to make decisions in the business regarding the maintenance and drivers. That autonomy was said to have allowed him to adopt a new maintenance provider and introduce weekly downloading of driver cards and monthly meetings. He must also accept responsibility for the continued operations.

Recital 12 to Regulations (EC) 1071 of 2009 (which have been retained through amendments arising from the Trade and Cooperation Agreement) and cited in 2015/040 Tacsi Gwynedd Ltd, explain that Fair competition and road transport that is fully compliant with the rules call for a uniform level of monitoring by Member States. The national authorities responsible for monitoring undertakings and the validity of their authorisations have a crucial role to play in this respect, and it is appropriate to ensure that they take suitable measures if necessary, in particular in the most serious cases by suspending or withdrawing authorisations or declaring as unsuitable transport managers who are repeatedly negligent or who act in bad faith. This is entirely consistent with the strong emphasis on firm and consistent regulation, and fair competition, explained in the Tribunal decision in 2014/008 Duncan McKee and Mary McKee.

I place even greater emphasis on the leading case of 2013/082 Arnold Transport Ltd in which the appellate Tribunal explained that: “Unfair competition is against the public interest because it encourages operators to cut corners in order to remain in business. Cutting corners all too easily leads to compromising safe operation.” The Upper Tribunal made clear that the grant of an operator’s licence does not mean that an operator can then proceed on the basis that the requirements that must be met in order to obtain a licence can thereafter be disregarded. In our view it is clear both from the terms of the Act and from Regulation 1071/2009 that these are continuing obligations, which an operator is expected to meet throughout the life of the licence. In the words of the Tribunal: The attitude of an operator when something goes wrong can be very instructive and I have referred to the continued blurring of operations and the permitted use of Mrs Butcher’s licence. To quote the Tribunal: “on many occasions … operator’s licensing is based on trust. Since it is impossible to police every operator and every vehicle at all times the… Traffic Commissioners in GB, must feel able to trust operators to comply with all relevant parts of the operator’s licensing regime. In addition other operators must be able to trust their competitors to comply, otherwise they will no longer compete on a level playing field. In our view this reflects the general public interest.

Ms Evans has suggested that negative elements include the discovery of the issues reported by Mr Donaldson dating to Summer 2020. It is accepted that operations were mixed between the three different operations as evidenced by the drivers’ hours infractions and the use of vehicles, with two drivers, including Mr Butcher, without the appropriate driving entitlement. Missing mileage continued to be an issue even after Mr Butcher departed and until very recently. The stated cause is only now being phased out. I am asked to find that this balanced out by a lack of regulatory history and to attribute the blame to Mr Butcher. I am asked to find that there has been sufficient change with monthly management of drivers’ hours, supported by the driver incentive scheme. It is also suggested that I can place weight on maintenance managed using R2C by Hanson’s. I have already commented on those arrangements, above and in particular the approach to brake testing. It was suggested that I could take additional assurance from undertakings for a compliance audit and a prohibition on Mr Butcher’s involvement. He is already disqualified to that effect. The evidence confirms that Mrs Butcher was aware of these wider decisions and should therefore have ensured compliance when the licence was given to her personally. I was told that Mrs Butcher accepted that her licence should be significantly curtailed following the continued use of that licence by the limited company.

Ms Evans correctly refers to the question posed by the Tribunal in 2256/2009 Priority Freight, namely: how likely is it that this operator will, in future, operate in compliance with the operator’s licensing regime? A significant element of that assessment involves the question of professional competence as neither operator currently has a Transport Manager. The legal onus is on the operators to satisfy me that Schedule 3 requirements are met. As the Tribunal explained in 2011/036 LWB Ltd: .it is for the applicant or operator to satisfy the Traffic Commissioner that the person concerned can fulfil the role of transport manager… it means in relation to a business: “an individual who, either alone or jointly with one or more other persons, has continuous and effective responsibility for the management of the road passenger transport operations of the business”. It follows, in our view, that when nominating an individual as a transport manager, (whether on an application for a licence or as an addition to or replacement for an individual who has acted as transport manager), it will be necessary to show that the person concerned will be able to exercise ‘continuous and effective responsibility’. The appointment of a new transport manager is, on its own, not enough to satisfy the requirement of professional competence. Instead, the operator must go further and show that the person appointed is of ‘good repute’ and ‘professionally competent’ and that the person is under contract to provide “continuous and effective responsibility for the management of the road passenger transport operations of the business”. For the reasons outline above, it will be obvious I am not with Ms Evans. Essentially, the case for the operator centres largely on the question of trust.

The actions of Mr Jordan are not enough to satisfy me that he is capable of fulfilling that role for the respective licence. His fitness also forms an essential element in determining the repute of the remaining operator. For the reasons explained by the summary of evidence above, I find that I cannot trust him to ensure future compliance. I regret that his actions go beyond mere mishap or innocent mistake and have resulted in an identifiable advantage. He has failed to satisfy me that he is capable of meeting the responsibilities of a Transport Manager. I therefore record formal findings that the company no longer meets the mandatory requirements for financial standing or professional competence. Direct Freight (Kelvedon) Ltd must be removed from the industry and I record that it has lost its repute. All findings are made under section 27(1)(a). That will take effect from 23:45 on 24 June 2022.

I have considered whether to disqualify, under Section 28 of the 1995 Act, the company and Mr Jordan from holding an operator’s licence in the future. Having performed the same balancing act as described above, I have decided to do so. There is a body of case law regarding deterrence, but most recently expressed in 2019/025 John Stuart Strachan t/a Strachan Haulage, where the Upper Tribunal confirmed that “one of the aims of the regime is deterrence, both for the appellant and for operators as a whole, who might be tempted to flout the system”. Other operators looking at the use of those licenses would be entitled to ask why these operators should be allowed to continue after ignoring the requirements of the licensing regime. The public intertest is clear, they should not. I have distinguished the position of Toby Kemp, but any application involving him will need to be referred to a Traffic Commissioner. In deciding upon the length of the disqualification, I have taken account of Statutory Document 10, which gives a starting point of between one and three years for a first public inquiry but for the reasons already set out above, I judge this to be a more serious case due to the length of time involved stretching back to Mr Butcher’s control. The company Direct Fright (Kelvedon) Ltd should be disqualified from holding or applying for an operator’s licence for a minimum period of 5 years. I have taken account of Mr Jordan’s limited involvement in terms of the period in post. I do not condone his actions and he should never have allowed himself to be put in this position but there are positives, which I have identified above. He will be disqualified from applying for, holding, or being involved in the management of a licence for a period of 18 months.

10. 13 May 2022

11. Addendum

Further to the above decision, which was issued on 13 May 2022, I received representations from Mr Ridyard, acting for the applicant, AJ Logistics Ltd. I have now seen a licence agreement between Welch’s Transport and the applicant, signed and completed on 12 May 2022 but said to take effect from 1 May 2020. It provides the required authority to park eight in scope vehicles for an initial period of six months, rolling over unless and until terminated by notice. It refers to the use of facilities including the office, toilets and kitchen area. That office space is exclusively for the use of the Applicant. This avoids the previous arrangement, which was reliant on entities under the control of other members of Ms Kemp’s family and makes the Applicant responsible for paying its own way.

Representations refer to the facts recorded above. As with any Applicant, a Traffic Commissioner must be satisfied that the mandatory and continuing requirement will be met. To that end I wished to be reassured as to the source of the monies which were said to be gifted to Ms Kemp and which were apparently paid via Direct Freight (Kelvedon) Ltd. I was provided with a statement from David Butcher signed and dated on 10 May 2022. That statement refers to the promise (apparently from Mrs Butcher and himself: “we”) to provide Ms Kemp with funds if she passed her CPC exams. Mr Butcher refers to this as an “unconditional gift”. He confirms that the sum was paid from the bank account belonging to Direct Freight (Kelvedon) Ltd, apparently to provide the funds as quickly as possible. He describes it as a director loan from Direct Freight (Kelvedon) Ltd to himself, but that is not how it was paid. Her ceased to be a Director on 21 March 2022 and repaid the money paid out by Direct Freight (Keldevon) Ltd on 11 and 12 April 2022.

In order to provide additional assurance, the Applicant offered a condition that David and Sylvia Butcher would not be employed by, or in any capacity be engaged in the operations or the management of AJ Logistics Services Ltd, directly or indirectly. That is not sufficient for these purposes. In addition to the directions described above, and any person having had involvement with the previous operations will attract scrutiny: David Butcher and Sylvia Butcher shall have no involvement directly or indirectly, in the management of and/or the transport activities carried on by the licence holder at any time.

The Applicant also offered an undertaking for a further review of financial standing. AJ Logistics Services Ltd will provide original or copies (verified by the issuing bank or building society) of financial evidence in its name covering the months of September, October and November 2022 to the Office of the Traffic Commissioner in Cambridge by no later than 31 December 2022. This must show that the operator has continued to meet the required level of available finance throughout the period by reference to an average balance, dependant on the rates applicable at that time. Rates to be found in the Senior Traffic Commissioner’s Statutory Document No. 2 https://www.gov.uk/government/publications/traffic-commissioners-finance-march-2019 Where originals are not available each statement must be stamped and authenticated by the bank/building society.

Mr Ridyard referred to the decisions to revoke the existing licences from 24 June 2022, leading to the dispersal of those fleets and drivers. Representations assured me that the feasibility of the AJ Logistic Services Limited operating model is not dependent on taking work for the business off that of Sylvia Butcher. By way of further assurance, I adopted the suggestion from Ms Kemp that she would be content for the grant of a smaller authorisation for four vehicles and four trailers. It will be open to this company to seek to increased authority following the review which will take place on or around 31 December 2022.

R Turfitt

Traffic Commissioner

22 May 2022

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