Neutral Citation Number: [2009] UKUT 278 (AAC)
Appeal No.  2009/509
IN THE UPPER TRIBUNAL		
ADMINISTRATIVE APPEALS CHAMBER
TRAFFIC COMMISSIONER APPEALS

ON APPEAL FROM THE DECISION OF
Beverley Bell TRAFFIC COMMISSIONER for the 
NORTH WESTERN TRAFFIC AREA Dated 4 September 2009

Before:
Judge Frances Burton
Leslie Milliken
David Yeomans

Appellant:
ASPEY TRUCKS LIMITED

	 
Attendances:
For the Appellant: Christopher Harris LLB MCIT of 
                              Harris Transport & Employment Consultants Limited

Heard at:	Victory House
Date of hearing:	13 November 2009
Date of decision:	14 December 2009

DECISION OF THE UPPER TRIBUNAL
IT IS HEREBY ORDERED that this appeal be ALLOWED and the case remitted to the Traffic Commissioner for rehearing by another Traffic Commissioner or Deputy Traffic Commissioner.

REASONS FOR DECISION

1.	This was an appeal against the Decision of the Traffic Commissioner for the North Western Traffic Area dated 4 September 2009 when she refused the Appellant’s application for an operator licence on grounds of lack of repute of the Director and Transport Manager.
2.	The factual background appears from the documents, the transcript of the public inquiry and the written decision of the Traffic Commissioner and is as follows.
(i)	The company was incorporated in 2004 and has two Directors, Mr Edward James Wood and Ms Angela May Aspiotis, his business partner and long term cohabitant. An application was made for a standard national goods operator licence on 26 February 2009. On 11 March 2009 the Appellant company was advised that the application would be published in Applications and Decisions on 25 March 2009 and that a decision would be made shortly afterwards by the Traffic Commissioner. On 8 April 2009 the Appellant company was advised that the interim licence had been refused. On 29 April 2009 Rothera Dowson Solicitors wrote to the VOSA Central Applications Services office at Leeds with detailed information in an attempt to persuade the Traffic Commissioner to grant the interim licence pending a public inquiry hearing on the grounds that currently Mr Wood was a man of good repute. On 8 May 2009 the Office of the Traffic Commissioner called the Appellant company to public inquiry on 15 June 2009 specifically requesting Mr Wood’s attendance.
(ii)	On 11 June 2009 Rothera Dowson wrote to the Traffic Commissioner to inform her that the Appellant Company proposed to engage a new Transport Manager, and enclosing a signed statement by Mr Gary Lyons, the Transport Manager designate. On 5 June 2009 Mr Wood booked for a National CPC course, and this booking document was forwarded to the Traffic Commissioner. No formal response to either of these communications, nor to the request for an interim licence, was received. Prior to the public inquiry however the Appellant company received a copy of a witness statement from PC Thomas of Greater Manchester Police, detailing the antecedents of Mr Wood, including a spent conviction for a drug offence, a spent conviction for a related driving offence and an item which was not a conviction (an offence of handling stolen goods, charged but left lying on the file).
(iii)	At the public inquiry the Appellant company was represented by Ms Vanessa Willets of Rothera Dowson Solicitors. At the outset of the public inquiry the Traffic Commissioner confirmed her satisfaction with financial standing and receipt of the notification of the new Transport Manager, and that she would not take into account the offence lying on the file (handling stolen goods) but would not necessarily disregard the two related spent convictions (a drug offence and driving whilst disqualified for 6 years). Ms Willets submitted that the spent convictions were 11 years old, in relation to associated offences which were 12 years old, and that, by Section 5 of Schedule 3 of the Goods Vehicle (Licensing of Operators) Act 1995, the Traffic Commissioner had discretion to disregard such convictions despite the fact that pursuant to the Rehabilitation of Offenders Act 1974 the conviction is never spent. Ms Willets also confirmed that since Mr Wood’s release in April 2004 he has been a successful businessman and is in a stable family relationship, besides which he had been a model prisoner trusted even to work with children. 
(iv)	It appears that the Traffic Commissioner was not impressed by these submissions and interrupted Ms Willets to say so. Ms Willets then indicated that she relied on the case of AB (2003/200) reiterating the Schedule 3 provisions, in which the Applicant had a long list of convictions for dishonesty and violence (which was not the case in Mr Wood’s circumstances). She relied on Bryan Haulage for the proposition that proportionality was a core issue in the present case. She submitted that the new Transport Manager satisfied s.13(3)(c). It was then agreed that prison and Parole Board records would be supplied by 20 July 2009 and a Decision would be written by the Traffic Commissioner by 27 July 2009. Subsequently an extension of time was agreed for production of these records but meanwhile a CRB check confirmed that Mr Wood had no further convictions and on 27 July 2009 Rothera Dawson invited the Traffic Commissioner to find that Mr Wood had regained his repute.
(v)	The Traffic Commissioner’s decision relied, in refusing the application, on Mr Wood’s conviction for serious drug offences (importation and conspiracy in relation to a Class B drug, value £3m) (cannabis) for which he had received an 11 year prison sentence of which he had served 5½ years before release on parole, but had not taken into account his conviction for driving while disqualified which had been spent in October 2005. She did, however, also rely on the fact that the importation was in a vehicle authorised on an operator’s licence, driven by Mr Wood when disqualified from driving for 6 years, although it appears that Mr Wood had always denied the drug offence. She gave credit for his exemplary record since, although repeating that the offence was accepted by Mr Wood to be “serious”, she laid great emphasis on the fact that an operator’s licence had been used for criminal activity. She considered the question posed by the Transport Tribunal in Priority Freight and Paul Williams, 2009/225, “how likely is it that this operator will, in future, operate in compliance with the operators’ licensing regime?” She then answered that question in relation to the present case  by taking into account Mr Wood’s responses to her questions put to him at the public inquiry: she said she found these “unclear and inconsistent”, that his answers had “changed” and indicated that he “appeared to have no proper accounting arrangements in place to show whether … vehicles (i.e. those in his current vehicle trading business) were being hired or sub-contracted” so that his accounting methods generally left something to be desired.  In particular she was concerned that “a number of cash transactions were not properly accounted for”. She concluded that she could not trust Mr Wood and that therefore neither he nor his company satisfied the repute requirement.
3.	At the hearing of the appeal the Appellant company was represented by Mr Harris who presented us with a helpful skeleton argument for which we were grateful. In this he relied heavily on the detailed terms of Schedule 3 of the Act, and in particular on the fact that (if the Traffic Commissioner had relied on only the drugs conviction Mr Wood had only one “serious conviction” and therefore did not have “more than one” as envisaged by paragraph 2(a). He submitted that she had therefore misdirected herself by refusing to regard the driving whilst disqualified conviction as spent. He also took exception to the receipt of PC Thomas’ letter as this was out of time for a statutory objection since it was dated 8 June 2009 and the objection Notice in Applications and Decisions indicated a deadline of 15 April 2009. He also submitted that the Traffic Commissioner had misunderstood Priority Freight as Mr Wood was not an existing operator and his accounting procedures, of which she had strongly disapproved, would have been developed appropriately once he was an operator. He submitted that she had given no weight at all to the appointment of an unobjectionable new Transport Manager. He suggested she should have asked “How likely is it” that Mr Wood would repeat the offences he had previously committed. Mr Harris then requested us to allow the appeal and to remit the case for rehearing before a different Traffic Commissioner.
4.	We consider that the points Mr Harris makes are fine distinctions. We take them in turn, and deal first with the inference drawn from the cash transactions. We note from the transcript that the Traffic Commissioner’s questions were, as a matter of fact, not well answered. It is the Traffic Commissioner’s duty to ensure fair competition and concerns about accounting are core issues. Cash transactions are a matter of concern to the Revenue and Customs agency as much as to the Traffic Commissioner and this is a matter distinct from financial standing as it goes to trust and repute. 
5.	Nevertheless we are concerned about this point.  The Traffic Commissioner appears to have assumed that tax had not necessarily been paid on the cash drawings and no accounts appear to have been asked for to establish the position in relation to the movements of cash. Mr Wood is a truck dealer in an environment in which cash is used in buying and selling vehicles.  In the absence of accounts to show whether or not these cash movements are recorded there it is unsafe to assume that tax has been avoided. Paragraphs 18 and 19 of the Traffic Commissioner’s Decision deal with this matter and appear to conclude from Mr Wood’s somewhat incoherent answers that he is hiding something.  She says, for example, that “he appeared to have no proper accounting arrangements in place to show whether those vehicles were being hired or sub-contracted, that he appeared to have no proper accounting arrangements in place to show payments made for the work supposedly being carried out  … that there were a number of cash transactions not properly accounted for …” . From a careful study of the transcript it appears to us more likely that any confusion and vagueness which she seems to have perceived in Mr Wood has its origin in a lack of sophistication and an ineptitude for speaking in public, and to the fact that (after the call up letter had stated that financial standing would be dealt with at the hearing and the Traffic Commissioner had then said at the outset of the public inquiry that she was satisfied with financial standing) her later interrogation about his accounting methods was in the nature of an unexpected ambush.  It is not surprising that he may have felt he had not been warned that he would need to deal with the matter of cash transactions in a truck dealership where cash is not out of the ordinary and that he had therefore been taken by surprise.  
6.	The next point which concerns us is the convictions.  Although the convictions in relation to the importation of cannabis resin and in a commercial vehicle which, being disqualified, Mr Wood should not have been driving (whether or not, as he contends, he knew about the drugs in the load) can never be spent because of the length of the prison sentence, a considerable amount of time has now passed since the incident giving rise to the convictions and there is significant evidence of rehabilitation. As a matter of fact both the drug importation conviction and the offence of driving while disqualified are “serious” and although they both arose from the same incident they are clearly two different convictions and not one.  Moreover the Traffic Commissioner has a discretion in relation to Schedule 3 which she appears to have exercised. The list of matters in Schedule 3 of which she is entitled to take account follow the word “including” which indicates that that list is not comprehensive. This does not therefore preclude her from forming an adverse impression of the evidence of a witness, especially of an Applicant director whom she must trust if she gives his company a licence.  Nevertheless we have a concern about the overall result in view of the previous point in relation to the lack of appropriate linking between the cash transactions and the conclusion that Mr Wood must or might be avoiding tax, since natural justice requires that he should have a fair hearing and the chance to establish that he has regained repute if that be the case.
7.	The application was refused for lack of repute, not professional competence, so the omission to deal with the new Transport Manager in detail is irrelevant as the Traffic Commissioner has noted his appointment and not refused for lack of professional competence. However we do retain a concern that the Traffic Commissioner’s finding of lack of repute was a little abrupt and that natural justice was not well served.  Examination of the transcript indicates that the Traffic Commissioner persistently interrupted Ms Willetts when she was making submissions about Mr Wood’s convictions and post custodial rehabilitation which, prima facie, appears to suggest a lack of open mindedness about his circumstances.  As Ms Willetts submitted, his present personal (as well as business) relationship with Ms Aspiotis is of longstanding and she is an equal partner in their commercial enterprises as well as their domestic life, which also points to a rehabilitative stability which seems not to have had any consideration. In all the circumstances, although this is a borderline case, we are of the view that the appeal should be allowed and remitted for reconsideration by another Traffic Commissioner or Deputy Traffic Commissioner who may come to the matter afresh so that all issues may be fairly assessed when Mr Wood has had sufficient warning to enable him to demonstrate whether he has now re-established repute.  

 Judge Frances Burton
14 December 2009