Decision

Decision for TFL Transport & Warehousing Limited

Published 12 April 2024

0.1 IN THE WEST MIDLANDS TRAFFIC AREA

1. WRITTEN CONFIRMATION OF ORAL DECISION GIVEN AT A PUBLIC INQUIRY ON 27 FEBRUARY 2024

2. TFL Transport & Warehousing Limited – OD1127683 and

3. Transport Manager Mitchell Lester

4. Background

TFL Transport and Warehousing Limited holds a standard national goods operator’s licence (OD1127683) authorising twelve vehicles and six trailers. The licence was granted on 30 April 2014.  There are two directors of the operating company – Mitchell Lester, who is also the nominated transport manager, and Danial Zafar.

The Driver and Vehicle Standards Agency (“DVSA”) conducted an investigation into the operator’s systems for complying with maintenance requirements.  The DVSA report dated 22 June 2022 is included in the Public Inquiry Brief (pages B1-B18) and highlights failings in the operator’s maintenance systems. It highlighted shortcomings in a number of areas including the following:

• Legal entity incorrect due to directors having resigned and a new director showing at Companies House, but not listed on the licence;

• Safety inspection records not properly completed with no method of brake performance test recorded and instances of driver reportable defects picked up at inspection but not recorded by drivers and instances of extended safety inspection intervals;

• Driver defect report sheets inadequate with no section for signature, date and endorsement of rectification of defects;

• No system in place to monitor adblue usage;

• Ineffective load security arrangements; and

• Prohibitions issued at fleet inspection which should have been picked up by the driver.

Assurances were given by the operator and transport manager in response to the failings identified by the DVSA vehicle examiner.  In view of those assurances, the DVSA examiner recommended that there should be a further investigation to assess compliance in six months’ time when he anticipated that the operator would be able to show “a vast improvement” from the “unsatisfactory” outcome of his investigation. In October 2023 there was a follow up Desk Based Assessment (“DBA”) conducted by the DVSA to examine the areas that were found unsatisfactory in June 2022.  That was also found to be “unsatisfactory” with the same failures found then that were found during the previous maintenance investigation (inspection sheets not conforming to best practice guidance, as advised on the previous visit; brake test performance not recorded at inspections; inspection intervals not managed, with some late inspections; driver reportable defects found at inspections, driver defect report sheets not completed correctly and defects found with no evidence of rectification).

5. Public Inquiry

The operator and transport manager were called to a public inquiry in Birmingham on 27 February 2024 to explore these apparent shortcomings and to consider whether the transport manger, Mitchell Lester, was continuing to exercise continuous and effective management of the company’s transport activities.  The call up letter to the operator explained that the traffic commissioner was also concerned that the company may not be of the appropriate financial standing to hold an operator’s licence for the number of vehicles authorised.  The company was directed to produce evidence of its financial standing showing access to the required amount for the twelve vehicles authorised (£57,500) over the previous three months.  The financial evidence submitted in advance of the inquiry hearing demonstrated that the operator fell very far short of that required amount – by around £REDACTED. In addition to financial evidence, the company and the transport manager were asked to send updated maintenance documentation to the DVSA in advance of the public inquiry hearing.  Vehicle Examiner Ridge, who had conducted the DBA in October 2023, assessed the updated documents provided to him and produced a supplementary report for the public inquiry dated 14 February 2024, which was served on the parties to the inquiry on 16 February 2024.

On 22 February 2024, the operator’s solicitors wrote to the OTC office in Birmingham to advise that it was accepted that the operator did not meet the financial standing requirement and that it wished to surrender its licence. That request was referred to me and I refused it under section 16(4) of the Act in view of these regulatory proceedings which involved consideration of a direction in respect of the licence under section 26 or 27 of the Act, as set out in the call up letter.  The public inquiry hearing called on 27 February 2024.  The operating company was represented by one of the directors, Mitchell Lester, who also appeared in his capacity as transport manager, represented by Charlotte Fowler of Backhouse Jones solicitors. I heard evidence from Mitchell Lester and representations on behalf of the parties from Charlotte Fowler.

6. Findings

I made the following findings based on the evidence before me and on the balance of probabilities:

The operator breached a condition of its licence by failing to notify an additional director (section 26(1)(b) of the Act refers);

The operator’s vehicles have been issued with prohibition notices by the DVSA in the past five years (section 26(1)(c)(iii) of the Act refers);

The operator made statements when applying for the licence which were false or have not been fulfilled (section 26(1)(e) of the Act refers);

The operator has failed to fulfil the undertakings signed up to when the licence was applied for (section 26(1)(f) of the Act refers);

Mitchell Lester was not exercising continuous and effective management of the company’s transport activities, as required by the legislation.  He no longer satisfies the requirements of section 13A(3) of the Act to be of good repute in accordance with Schedule 3 to the Act.

The operator no longer meets the requirements of section 13A(2) as to financial standing. In view of my findings and decision in respect of Mitchell Lester as transport manager, the operator no longer meets the requirement of section 13A(3) of the Act as to professional competence.

7. Reasoning and decisions

It was suggested by Ms Fowler that I could not make any finding as to financial standing because the operator had requested that the licence be surrendered. She referred me to the case of Britannia Hotels Limited & Alexander Langsam T/A Britannia Airport Hotel (2004/362 & 2004/72) in support of that argument. The surrender request was made a matter of days before the public inquiry hearing, and I had refused to accept it because I was considering making findings under sections 26 and 27 of the Act.  I considered the Britannia Hotels decision but was satisfied that it could quite clearly be distinguished on the facts. I had made adverse findings as to the way in which this operator had operated its vehicles.  Late safety inspections, lack of adequate brake testing and defects found on vehicles at inspection which should have been picked up before inspection were compliance failings which could well be due to a lack of finances.  The shortfall of finances in the Britannia Hotels case was a relatively small amount, but this operator was failing to meet the required level by a very large margin of nearly £REDACTED. There was evidence during the inquiry that the company was in financial difficulties, the decision had been taken that it couldn’t carry on for that reason and the business was winding down with a view to stopping operations later this month. I considered that it was entirely appropriate for me to consider whether the operator continued to meet the continuing and mandatory requirements of section 13A(2)(c) of the Act.  I concluded that it did not and, consequently, directed that the licence must be revoked as required by section 27(1)(a).

The question of financial standing aside, I considered this to be a serious case where there had been persistent operator licence failings with an inadequate response from the operator.  The failures identified in the DVSA report in June 2022 were still present at the time of the DBA in October 2023 and again at the time of this public inquiry, with the Vehicle Examiner commenting in his statement of 14 February 2024 “There is no evidence of improvement following the …DBA, the operator has not addressed any of the shortcomings previously identified.” There was ineffective management control and insufficient procedures in place to prevent operator licence compliance failings.  There was ineffective or insufficient driver training with insufficient or ineffective monitoring procedures in place, particularly regarding driver walkaround checking and defect reporting. Insufficient changes had been made to ensure compliance, despite the operator having been given an opportunity to get things right, not once but twice before these shortcomings were referred to OTC.  The operator also had a high prohibition rate, with a mechanical prohibition rate of 33.33%, which was significantly higher than the national average of 21.7%.

On the positive side of the balance, this was the operator’s first appearance at a public inquiry, it co-operated with the enforcement investigations, it has an above average MOT pass rate and there had been no “S” marked prohibitions.   

Weighing the negative and positive features in the balance, I considered this to be a “serious” case having regard to the Senior Traffic Commissioner’s Statutory Document 10.  Revocation was inevitable given my finding that the operator no longer met the statutory financial standing requirements.  Pursuant to sections 26(1)(b), (c)(iii), (e), (f) and 27(1) I directed that the licence be revoked with effect from 23:45 hours on 29 March 2024, to allow for an orderly run down.

8. Good repute of transport manager

I was satisfied on the evidence and on the balance of probabilities that Mitchell Lester failed to exercise continuous and effective control of the operator’s transport operations. His response to the DVSA findings was completely inadequate, even when he was given an opportunity to get things right.  The “vast improvement” that he had promised, and that the DVSA anticipated, did not materialise by the time of the DBA and the same compliance failings were still present as at the date of the public inquiry.  Some of those were serious, particularly as regards brake testing not being carried out at each inspection. Concerningly, Mr Lester admitted in his evidence before me that he had not realised that it was a requirement that a brake test be carried out at each safety inspection. He fully accepted in evidence that his understanding of his duties as a transport manager was inadequate, and that he had not been performing that role as he should have been.  He had qualified as a transport manager some 10-12 years ago and had never completed any refresher training.  When asked why he had not implemented the necessary changes identified by the DVSA, his response was that he had been too busy in his role as director managing other aspects of the business.  However, the role of transport manager is a key one which he failed to perform effectively and continuously resulting in the compliance failures found.  Those failures presented a clear risk to road safety. 

In considering the good repute of Mitchell Lester as transport manager I performed the same balancing act as set out above with reference to the negative findings and features outlined.  I considered whether there were any positive features to be weighed in the balance.  Mr Lester was candid in his evidence before me and he recognised the need to improve his knowledge and skills.  He does intend to go on a transport manager refresher training course, however, as at the date of the inquiry he had not done so.  That is because of all that had been going on with the business and its winding down.  He did not know what he would do next in terms of business or employment, but it was likely to be in the transport industry, which is the only one he knows. 

In considering whether his good repute was lost, rather than merely tarnished, I had regard to relevant Upper Tribunal case law, including Angus Smales trading as Angus Smales Eventing (2014/058) when the Upper Tribunal confirmed that being a transport manager is far more than just holding the qualification.  I found that Mitchell Lester had not demonstrated the ability to meet the statutory duty and that continued to be the case. In the circumstances, and as was confirmed in Matthew Reynolds (2015/049), I was therefore obliged to find that he had lost his repute as transport manager and no longer satisfied the requirements of paragraph 14A of Schedule 3 to the Act.  I considered whether such a finding would be a disproportionate response but determined that it was entirely proportionate on the evidence before me.

Having concluded that Mitchell Lester’s good repute was lost I was also obliged to disqualify him under paragraph 16(2) of Schedule 3 to the Act from acting as a transport manager on an operator’s licence.  I directed that he be disqualified from acting as a transport manager on an operator’s licence with effect from 23:45 hours on 29 March 2024.  Although Mr Lester is at liberty to seek to vary that direction, I was obliged to disqualify him for the minimum period of 12 months by virtue of paragraph 17(1A) of Schedule 3 to the Act.  I indicated that he would be well advised to complete refresher training and work with an experienced CPC holding transport manager if he is to seek to persuade a traffic commissioner that he is capable of meeting the statutory requirements in the future.

Victoria Davies

Traffic Commissioner for Wales

Sitting as a Deputy Traffic Commissioner in the West Midlands Traffic Area

1 March 2024