Neutral Citation Number: [2015] UKUT 149 (AAC) Appeal No: T/2014/73

IN THE UPPER TRIBUNAL

ADMINISTRATIVE APPEALS CHAMBER

(TRAFFIC COMMISSIONER APPEALS)

ON APPEAL FROM THE DECISION OF MR K ROONEY,

TRAFFIC COMMISSIONER for the NORTH EASTERN TRAFFIC AREA,

DATED 25 SEPTEMBER 2014

Before:

Judge M Hinchliffe, Deputy Chamber President (HESC); Judge of the Upper Tribunal.

Mr G Inch, Member of the Upper Tribunal.

Mr A Guest, Member of the Upper Tribunal.

Appellants:

SKYWAY TRAVEL (UK) LTD (Operator)

FAZAL KARIM ALI (Director and Transport Manager)

FARMIDA AKHTAR (Director)

Attendance:

For the Appellants: Mr S Newman, Solicitor.

Appeals heard at: Field House, Breams Buildings, London.

Date of hearing: 27 February 2015.

Date of decision: 24 March 2015.

DECISIONS OF THE UPPER TRIBUNAL:

IT IS HEREBY ORDERED that the appeals be dismissed

Subject matter:

The appeal process is not merely a second time around re-run of the first instance public inquiry or hearing.
Anyone with a history of ‘fronting’ for others is likely to face similar regulatory action to that faced by the person or persons for whom they have previously or currently attempted to provide a front or cover (including, if necessary, a lengthy disqualification).

Cases referred to:

Bradley Fold Travel Ltd and Peter Wright -v- SoS for Transport [2010] EWCA Civ 695

REASONS FOR DECISIONS:

Background.

1) This was an appeal from the decision of the Traffic Commissioner for the North Eastern Traffic Area made on 25/9/2014 when, amongst other things, he revoked the standard international PSV operator’s licence held by Skyway Travel (UK) Ltd under Section 17 of the Public Passenger Vehicles Act 1981 (“the Act”), and disqualified Mr Fazal Karim Ali and his wife, Mrs Farmida Akhtar, from holding or applying for an operator’s licence in Great Britain for a period of seven years. Under Schedule 3 of the Act, the Traffic Commissioner also found that Mr Ali had lost his repute as transport manager, and disqualified him from acting as such in any member state for a period of seven years.

2) Until the licence was revoked, Skyway Travel (UK) Ltd was the holder of a standard international PSV operator’s licence authorising the use of six vehicles. The company has two directors, Mr Ali and his wife, now known as Mrs Akhtar but previously known as Mrs Ali, born 8/11/1964. Mr Ali is also the operator’s transport manager. On the Companies House records, Mr Ali is simply recorded as “Mr Fazal Karim” (the name ‘Ali’ has been omitted) but there is no doubt that this is the same person as Fazal Karim Ali, born 20/11/1962 – who, with his wife, has had previous involvement with the operating license regime. Indeed, Mr Ali and his wife have a lengthy regulatory history in the PSV industry.

3) On 5/2/2001, a company called A1 Travel UK, which Mr Ali operated as a sole trader, had its operator’s licence revoked.

4) On 23/4/2004 a company called A1 Travel UK Ltd, of which Mr Ali’s wife was director, appeared at public inquiry and had its operator’s licence revoked. Its directors were disqualified from holding or obtaining an operator’s licence indefinitely. The (then) Traffic Commissioner’s decision noted that Mr Ali’s wife, the licence holder, had absented herself from the UK since at least October 2003 until the date of the public inquiry in 2004. The operation has been controlled, not by the operator, but by other parties, and had been run extremely badly. The public had been put at risk. The then Traffic Commissioner recorded his understanding that Mrs F Ali (as she was then referred to) was the wife of Mr Ali, who the Traffic Commissioner described as the “eminence grise” behind the operation of the interlinked licences. It was noted that Mr Ali had been the holder of a licence that was revoked at public inquiry in December 2001. The Traffic Commissioner found that it was overwhelmingly appropriate and proportionate that the licence held by Mr Ali’s wife should be revoked on the grounds of loss of good repute, with effect from 15/6/2004. The Traffic Commissioner found that the failures of Mrs Ali to exercise responsible control, and her involvement in the “charade” of presenting herself as the “front” for Mr Ali, made it necessary to come to the conclusion that disqualification indefinitely under section 28 of the act was appropriate. The disqualification took effect from 23:59 hours on Tuesday, 15 June 2004. It does not appear to have been ever brought to an end.

5) Despite the disqualification, it appears that, on 16/8/2005 Mr Ali’s wife, now referred to as Mrs F Akhtar and trading as Skyway Travel, was granted a restricted operator’s licence. It does not appear that the previous disqualification was disclosed. That operator’s licence was surrendered on 10/8/2009. Mr Ali’s wife was then granted a standard international licence to replace the restricted licence. That licence was revoked at the public inquiry in May 2012. Mr Ali, the transport manager, was also disqualified indefinitely.

6) The present operator had its application for an operator’s licence considered at public inquiry in December 2012. The application was granted but only for two vehicles. The nominated transport manager, at that time, was a Mr James Joseph Johnson. The Traffic Commissioner found that Mr Johnson lacked in professional competence and refused his nomination, but allowed a period of grace to nominate an alternative. Subsequently, authorisation was increased to 6 vehicles (from 14/5/2013) and Mr Ali was accepted as transport manager. Thus, between December 2012 and May 2013 the operator had authorisation for two vehicles only.

7) Amongst the promises made to the Traffic Commissioner in December 2012 were assurances that the maintenance facilities and technical equipment at the operator’s operating centre would be significantly improved.

Facts

8) On 8/2/2013 a Traffic Examiner encountered a vehicle at Skipton in North Yorkshire displaying an operator’s licence disc in the name of James Joseph Johnson. However, the driver said that he was employed by Skyway Travel who (he said) paid his wages and deducted tax and National Insurance. He also said that he was given his instructions by “Faz at Skyway” and that he had no idea who Mr Johnson was. He later changed his statement and said that he was working for Mr Johnson. However, when Mr Johnson was spoken to, he confirmed that he had not hired a coach to the operator on 8/2/2013, and he denied that it was being operated under his operator’s licence on that occasion.

9) On 12/4/2013 an immediate prohibition which was “S” marked was issued to one of the operator’s buses.

10) On 26/4/2013 a fatal collision occurred on the M62 in West Yorkshire. The collision involved an articulated goods vehicle and a bus driven by Mr Johnson. As a result of the post-collision investigations, a number of matters emerged. For example, a search under warrant of Mr Ali’s home was undertaken and, during that search, three operator licence identity discs were found in the name of James Joseph Johnson. Examination showed that these discs were forged, and had been manufactured by copying a genuine disc. A diary of bookings was also seized.

11) On 26/6/2013, the operator was the subject of an unsatisfactory maintenance investigation, prompted by the “S” marked immediate prohibition of 12/4/2013.

12) A public inquiry was called up by letter dated 21/3/2014, and was initially scheduled to take place on 7/5/2014. The call-up letter raised the issues of stable establishment, good repute, financial standing and professional competence. Breach of conditions and undertakings was also raised, along with prohibitions, Mr Ali’s previous convictions (about which there is a discrepancy between his declared convictions on the present application, and those disclosed by Mr Newman in earlier correspondence, and previous undeclared disqualifications. The prohibition schedule available at that time included 5 prohibitions from 2013, including 4 immediate prohibitions, one of which was the “S” marked prohibition. There were also two tachograph prohibitions. The good repute of Mr Ali as Transport Manager was also raised, and he was called up separately.

13) Because of concerns around the proper handling of the public inquiry whilst investigations and possible proceedings in relation to the fatal road traffic accident continued, the public inquiry was adjourned. It eventually took place on 29/7/2014.

14) In the fortnight leading up to the public inquiry, the Traffic Commissioner was made aware that one of the operator’s coaches had been involved in a collision at a motorway service area involving brake failure. It was also apparent that, after making a phone call to the operator’s office, the driver had driven the vehicle away from a standstill on the hard shoulder when the warning systems indicated a brake system fault, and proceeded to the service station, where the brakes failed and a collision occurred. In doing so, the driver had placed himself, the vehicle, the passengers on board, and other road users at great risk.

Traffic Commissioner’s Conclusions

15) The Traffic Commissioner heard all the material evidence and concluded that:

(a) The operator’s vehicles had not been kept in a fit and serviceable condition;

(b) During the period when only two vehicles were authorised, there were occasions when more than 2 vehicles were being used at the same time. The Traffic Commissioner did not accept that, in truth, the additional journeys had been subcontracted to Mr Johnson, or that Mr Johnson was the operator of those vehicles at the material times. He found the paperwork produced, but not supported by any persuasive evidence of monies actually changing hands, to be evidentially worthless. On balance, the Traffic Commissioner found that, during this period, Skyway Travel (UK) Ltd was routinely operating more vehicles than it was authorised for;

(d) The facilities at the operating centre were so poor as to fall short of the ‘stable establishment’ requirements in Article 5(c) of EU Regulation 1071/2009.

(e) The wife of Mr Ali, born 8/11/1964 – and known variously as Mrs Ali and Mrs Akhtar – had previously acted as a ‘front’ for Mr Ali, was not in any way a controlling presence, had previously been disqualified from holding or obtaining an operator’s licence, and that disqualification had never been rescinded;

(f) The collision at the motorway service area arose as a consequence of the dangerous mechanical condition of the vehicle, and poor decision-making and management once the situation had arisen. This had placed passengers and other road users in extreme, but avoidable, risk of serious harm. Moreover, had the vehicle been properly maintained in the first place, such a set of circumstances would not, and should not, have arisen.

16) The Traffic Commissioner considered any positive features, which he placed into the balance, but he concluded that the positive features did little to offset the negative.

17) The Traffic Commissioner concluded:

“This is an operator who appears to have a flagrant disregard for such basic matters as running only the number of vehicles for which there is authority. Assertions in relation to the building of proper maintenance facilities fell to be hollow. The apparent hiring arrangement with Mr Johnson appears little more than a mechanism to conceal the hiring of Mr Johnson’s licence discs. A vehicle crashed because of poor maintenance and poor transport management. That crash was wholly avoidable, and the operator and transport manager wholly responsible. To be clear, had the driver needed to stop at any time whilst on the last few miles of that journey, he plain and simple could not have done so, and that is due to the actions of Mr Ali and Mr Raza (Mr Ali’s son). The third director, Mrs Akhtar, should not forget she is also responsible. Such serious breaches of trust and failures in vehicle maintenance lead to an inevitable answer to the “Priority Freight” question of how likely is it that this operator will, in future, operate in compliance with the operator’s licensing regime, of “very unlikely”.

The seriousness of the events that led to the crash of OJZ4976 is enough in itself to support an answer in the affirmative to the “Bryan Haulage” question: is the conduct such that the operator ought to be put out of business? The renting of licence discs, operating of more vehicles than authorised in contravention of the condition applied at public inquiry, and the failure to make improvements to facilities when promised, merely strengthen that conclusion. Skyway Travel (UK) Ltd and directors have each lost their good repute, in Mr Ali’s case, as a transport manager as well as an operator.

As I have set out above, Mr Ali and Mrs Akhtar have a very poor history as operators. It is without doubt that I find that Mr Ali’s lack of honesty requires me to disqualify him, and for a lengthy period. Given the history of his wife in providing a front for him, it is appropriate that her disqualification matches his. Further, Mr Ali has quickly shown himself once again to fail to have what it takes to be an effective transport manager, with near disastrous consequences. This is, in effect, Mr Ali’s fifth licence and the fourth to be revoked. The time has come for his career as a PSV operator to come to an end before someone is killed.”

Grounds of Appeal

18) Prior to the hearing the tribunal gave permission for the Grounds of Appeal to be amended and extended. Mr Newman also provided a skeleton argument extending to 12 pages.

19) In summary, Mr Newman raised 6 points:

(a) The Traffic Commissioner was wrong to find that, during the period when authorisation was limited to two vehicles, the operator had operated more than two vehicles at any one time;

(b) The Traffic Commissioner was wrong to find fault with the operator or Mr Ali in relation to the vehicle that suffered a brake malfunction and was then driven on to a motorway service station and then crashed;

(c) The Traffic Commissioner was wrong to find that the operating centre facilities were so poor as to form the basis of an adverse judgment in relation to a stable and effective establishment;

(d) Mrs Akhtar had not been disqualified in 2004, and she was not the same person as Mrs Ali;

(e) The Traffic Commissioner did not separately state what regulatory action was necessary in relation to those matters that did not require mandatory revocation and did not decide what discretionary direction was appropriate;

(f) The Traffic Commissioner gave inadequate reasons for the disqualification of Mrs Akhtar, and the disqualifications generally were not justified.

Conclusions of the Upper Tribunal

20) We find that none of these points has any merit. Points (a) to (d) are, in effect, criticisms of findings of fact made by the Traffic Commissioner on the evidence. Mr Newman attempted a piecemeal dissection of certain aspects of the oral and documentary evidence, and sought to rely upon provisions of the Civil Evidence Act 1995, but we are satisfied that the Traffic Commissioner, as a tribunal, was right to consider all of the evidence in the round, deciding what he accepted and what he did not accept, and he was entitled to accept ‘hearsay’, especially where its effect was corroborative either of direct evidence, or inferences reasonably and properly drawn from the totality of the evidence.

21) In our view, the assertions made by Mr Newman, as he attempted to unpick the Traffic Commissioner’s careful approach to the analysis of the evidence, were little more than a re-run of what we could call ‘jury points’ – that is, submissions made to the Traffic Commissioner, but which the Traffic Commissioner was at liberty to reject should he consider it right to do so, on the evidence. As is well known, the appeal process is not merely a second time around re-run of the first instance public inquiry or hearing. The question for us, on appeal, is whether reason and the law require us to take a different view from that of the Traffic Commissioner. In our judgment, for the reasons given below and having regard to the background and factual matrix summarised above, we are not so required (see - Bradley Fold Travel Ltd and Peter Wright -v- SoS for Transport [2010] EWCA Civ 695).

22) The evidence of Mr Mihailovic (Traffic Examiner) and Mr Brown (Vehicle Examiner) amply covered the issues arising, along with statements from both the driver of the vehicle stopped on 8/2/2013 and from Mr Johnson himself, together with the evidence from the driver of the vehicle that suffered the brake failure, and having regard to all of the documentary evidence presented. Mr Mihailovic, for example, noted that the police had not only seized fake discs, but a diary which showed that, between 5/1/2013 and the end of April 2013, the company was regularly taking more bookings than could be fulfilled, given their limited authorisation of two vehicles. Mr Mihailovic also argued convincingly that a hire agreement subsequently presented was “fabricated in an attempt to hide the alleged offence … as with all of the other contracts, there is no trail to suggest that any money has ever changed hands”. Having seen and listened to the witnesses and examined the documentation, the Traffic Commissioner was entitled to accept this argument for the reasons set out by Mr Mihailovic and by the Traffic Commissioner.

23) The Traffic Commissioner found that some documentary evidence relied upon by the operator, including supposed hire agreements with Mr Johnson, were not worth the paper they were written on. In our judgment, these assessments by the Traffic Commissioner were sound and sensible, and arose naturally from the evidence taken as a whole, and the Traffic Commissioner’s analysis thereof. If we were to go down the road suggested by Mr Newman, we would end up re-evaluating the evidence for ourselves, when we have not had an opportunity of listening to the witnesses. In our view, having regard to the diary, the crude attempt at the fabrication of agreements when no evidence could be found of any genuine commercial transactions, and the damning evidence relating to the incident on 8/2/2013, there was ample evidence to justify a finding that, during the period when authorisation was limited to two vehicles, the operator had operated more than two vehicles at any one time. It was also clear that the directors and transport manager had then tried to cover up this unauthorised use by making false claims, and asserting arrangements that did not exist in reality.

24) The tribunal shared the horror of the Traffic Commissioner at the facts surrounding the brake failure on a bus travelling along the motorway, and the astonishing decision of the operator’s managers and controllers to not call the emergency services when the vehicle had stopped on the hard shoulder of the motorway, and the driver had rung in. The coach driver had sought advice, and had then followed it, and we can see no possible excuse for the danger that was created by the totality of the events on that day, including the poor maintenance that had led to the situation in the first place.

25) The maintenance facilities are described in the vehicle examiner’s report and are shown in photographs. The only cover is an open fronted building; long enough to accommodate less than half the length of a conventional 49-seat coach. A finding that the operating centre did not have the appropriate facilities was entirely within the range of decisions open to the Traffic Commissioner, and deserved particular adverse weight given previous promises made about improving facilities and available technical equipment.

26) As far back as 2012, Mr Newman, solicitor for the operator, had tried to suggest that Mrs Akhtar was not the same person as Mrs Ali, who had been disqualified in 2004. Mrs Akhtar, he said, had simply been the company secretary. The Traffic Commissioner addressed this in his decision and again when refusing a stay. He said that the operator licence business system recorded that the director of A1 Travel Ltd (who the then Traffic Commissioner understood to be the wife of Mr F.K. Ali) was born on 8/11/1964. This was the same person as Mrs Ali (d.o.b. 8/11/64) whose licence was revoked in 2004 with an indefinite disqualification. This is also the same date of birth as the present Mrs Akhtar, and Mr Ali confirmed to the tribunal that he has not had more than one wife with the same date of birth.

27) On top of that, there were some other incontrovertible facts. For a small fleet operating under this operators licence for a short period of time, the prohibition history is very poor. For example, an immediate prohibition notice, deemed to involve a failure of the maintenance system, was issued when a vehicle was presented for annual test – a time when a vehicle should have been free from such defects. A second attempt to obtain an MOT again resulted in failure, again for a braking defect. A different prohibition took two attempts to clear, and the prohibition history as a whole, with instances of significant maintenance failure and braking and safety critical defects, is both appalling and extremely worrying. The Traffic Commissioner was right to fear the possibly fatal consequences, if this situation was allowed to continue. Mr Ali’s culpability extends equally to his role as director, and as transport manager.

28) This is a case where the findings of the Traffic Commissioner in relation to repute, stable establishment and professional competence would all lead to revocation, following the consideration of the “Priority Freight” and “Bryan Haulage” questions. In our view, to expect the Traffic Commissioner to reach separate entirely academic assessments of the seriousness of the other grounds that justified discretionary action, in artificial isolation from the totality, would be unreal and futile. We find no merit in this submission.

29) So far as the periods of disqualification are concerned, they are entirely consistent with the Senior Traffic Commissioners Guidelines and are justified and explained in the Traffic Commissioner’s decision. In relation to Mr Ali’s wife, the Traffic Commissioner said: “Given the history of his wife in providing a front for him (Mr Ali), it is appropriate that her disqualification matches his”. We agree. As the Traffic Commissioner said elsewhere in his decision, Mrs Akhtar shares responsibility and, given her repeated past willingness to provide cover for her husband, if he is to be disqualified for seven years, then the only realistic way to prevent her returning to this pattern of behaviour with a view to subverting and undermining the operator licensing regime is to disqualify her for a similar period. This is likely to be the price paid by anyone with a history of ‘fronting’ for others. There seems, to us, to be a clear logic about this, which is hard to gainsay.

30) For the avoidance of doubt, we would consider that the fixed term seven-year disqualification for Mrs Akhtar (Ali) replaces the previous indefinite disqualification. It is almost certain that, even after the seven years have elapsed, the Traffic Commissioner would wish to hold a public inquiry should any sort of application be made by Mr (Karim) Ali, or his wife. Such application, we are sure, would receive the most anxious scrutiny.

31) In summary, we consider that the Traffic Commissioner had an opportunity of seeing and listening to the witnesses, and was perfectly entitled to reach the factual conclusions that he did reach, on the evidence before him. In our judgment neither reason, nor law, compel us to interfere - and the Traffic Commissioner cannot be said to be plainly wrong in his findings of fact, his interpretation of the law, or his analysis of the consequences of such findings and interpretation. Indeed, in our view, he was plainly right.

32) In all the circumstances, we find no merit in any of the grounds of appeal or submissions, and the appeals are dismissed.

Judge M Hinchliffe, DCP

24 March 2015