Decision

Application to the Traffic Commissioner for the return of detained vehicle LG61AKO

Published 27 June 2022

0.1 WESTERN TRAFFIC AREA

1. Application to the Traffic Commissioner for the return of a detained vehicle

2. LG61AKO

2.1 by applicant

3. NPB Contracts Ltd

4. BACKGROUND

The circumstances giving rise to the detention of the vehicle are set out in the witness statement of DVSA Traffic Examiner Amy Comer dated 28 July 2021 and found at page 23 of the hearing bundle. In summary:

• On 24 June 2021, TE Comer was on duty at the DVSA check-site at the junction of the M4 and A46, at Tormarton. The check was in cooperation with Wiltshire Police.

• TE Comer was made aware that the Police had stopped vehicle LK61AKO and at 10:39 she examined the vehicle and accompanying drawbar trailer. She noted that no operator’s licence disc was displayed. The combination was carrying five cars.

• The driver of the vehicle gave his name as Sorin Paul with a home address in Rochdale. When asked who he was working for, Mr Paul showed TE Comer a company logo on his phone relating to EMK Trading Ltd (“EMK”).

• Wiltshire Police confirmed that the holder of insurance for the vehicle was EMK

• Mr Paul indicated that he had been working for EMK for about 4 weeks. He was paid in cash. In response to a question about who gave him his orders, he showed TE Comer a contact on his phone “Boss Lucru Newry” which he translated as “Boss working Newry”. Mr Paul received a number of WhatsApp messages which indicated to him that he was working for NPB Contracts Ltd (“NPB”) with their licence number.

• EMK had been the holder of a goods vehicle operator’s licence which had been revoked

• TE Comer managed to have a telephone conversation with Niall Black, sole director of NPB. Mr Black told Ms Comer that NPB had previously operated the vehicle and that he was in the early stages of negotiating to buy EMK. There was no paperwork to support that nor was there any documentation relating to purchase of the vehicle. Mr Black did not know who the driver was, how he was to be paid nor did he have any knowledge of the load. TE Comer asked whether there was as yet any gentleman’s agreement and Mr Black said no. Mr Black explicitly stated that he was not the operator of the vehicle at that time.

• Driver Sorin was interviewed and have the following:

• EMK gave him his orders, NPB owned the vehicle

• He was not self-employed but was employed by EMK and paid cash

• He collected the vehicle usually from Newry, sometimes Belfast

• The delivery documents were given to him by Cillian O Dubhthaigh

• In relation to repairing a tyre defect on the trailer, he would be contacting EMK to pay the bill

• Mr Sorin was told that the vehicle was being impounded. A little later, Mr Black called TE Comer. He now said that he was the operator of the vehicle but still did not know the nature of the journey. He struggled with the driver’s name and TE Comer believed he was being prompted.

• Neither EMK nor NPB made arrangements for the trailer and load to be collected and the vehicle, trailer and load were impounded in their entirety. The driver was assisted with arrangements for his homeward journey.

• On 29 June, TE Comer received a call from Mr Black enquiring on how to secure the return of his vehicle.

• On 30 June, TE Comer received a call from the director of EMK seeking return of her vehicle, trailer and its load.

• Further emails were exchanged in relation to securing release of the trailer and load. A copy invoice was received showing sale from EMK to a company Slieve Gullion Stone (“SGS”). A bank statement was received from EMK showing corresponding money in from SGS.

An application for the return of the vehicle was received from NPB by my office on 8 July 2021. The ground relied upon was that the user of the vehicle at the time the vehicle was detained was the holder of a valid licence at that time. At this point, I had not seen TE Comer’s statement and noted that the applicant did indeed have a licence. I directed that the application be passed to DVSA for them to set out their position as to why a vehicle was impounded when apparently operated by a legal operator. I received TE Comer’s statement. I did not find the ground to be made out on the papers. Whilst the applicant had not requested a hearing, the facts were clearly not straightforward. Availability of the parties delayed the hearing particularly as, given the obviously conflicting evidence, an in-person hearing was desirable.

I was notified that the applicant and his solicitor, Colleen McCreesh, felt it was unsafe to travel to Bristol due to the risk of infection and wished to proceed by video hearing. I was concerned that the application might not be as effective in that manner but was also conscious that these are inter-parties proceedings so my independence is crucial. On balance, I asked my clerk to write to Ms McCreesh in the following terms:

“The Traffic Commissioner directed that the hearing be heard in person because there is an apparent conflict between the applicant’s position on the day the vehicle was detained, as reported in the witness statement of DVSA Traffic Examiner Amy Comer, and that now stated within the application. Such a conflict is best resolved with the clearest communication possible. Video links may not assist

Review of the latest Covid travel guidance on both the gov.uk and nidirect.gov sites indicates that travel within the Common Travel Area is perfectly permissible through the taking of lateral flow tests. However, the Commissioner notes that this is an application and the onus is on the applicant to satisfy that one of the statutory grounds is made out. If the applicant believes it can do that remotely, then the hearing can proceed using Microsoft Teams. The Commissioner puts you on notice that he is highly unlikely to accept an adjournment request should you later find that presentation of the case remotely is not fully effective (unless, of course, that is due to a technical issue at our end).”

5. THE HEARING

The applicant did not attend in-person but both Mr Niall Black and his solicitor Colleen McCreesh were present via Microsoft Teams. I was aware that TE Comer had been signed-off as unfit to work but she was good enough to attend via Teams. Her line manager, Traffic Enforcement Manager Melanie Yorke, attended in person to assist if necessary. DVSA was further represented by Felicity Hine, solicitor. Ms Hine also attended via Teams. Her connection was barely acceptable and it did hamper proceedings in that questions had to be repeated but I am satisfied that it did not impact on the overall fairness of the proceedings. Ms Hine further set out in advance a summary of DVSA’s case and submissions on behalf of DVSA. She also provided a copy of the invoice for the vehicle to SGS – this was otherwise missing from the hearing bundle.

The evidence and submissions are recorded electronically and a transcript is available if needed. I summarise only the key facts here. They are in the order of the issues for consideration rather than chronological.

5.1 Ownership

Ms McCreesh submitted that ownership of the vehicle by NPB was obviously satisfied. She referred me to the invoice at page 13 of my bundle relating to the sale of the vehicle from EMK to NPB noting it was dated 18 June, well ahead of the vehicle’s detention on 24 June. She took me to page 11, which is a copy of an insurance “temporary cover note” for the vehicle in the name of NPB having effect from 15:00 hours on 22 June 2021. At page 14 was the new keeper slip dated 18 June. At page 21 was the bank statement of SGS showing the corresponding transfer of money on 22 June, all before the impounding. Niall Black was the sole director of SGS and NPB. He had used the bank account of SGS to buy the vehicle as it had funds available. I asked Mr Black why he had not used the bank account of NPB, noting that a standard licence holder should have access to finances. Ms McCreesh told me that Mr Black was the sole director and shareholder of both NPB and SGS. He had money in the SGS account so it was convenient to use it. Mr Black also told me that the money was readily available in SGS. He then told me that it could take a couple of days sometimes to transfer money online especially if it was a first payment to a new recipient and that was why he hadn’t moved the money from SGS to NPB and then made the purchase from NPB’s account. He had needed to move quickly. A lot of the money in the NPB account would be euros.

Ms Hine asked Mr Black why he had said to TE Comer at the time that no paperwork existed when it would have been fresh in his mind given that it was dated only a couple or a few days earlier. Mr Black told me that he was unsettled by the call from the Traffic Examiner and didn’t really understand what was going on. He thought TE Comer was asking for operator licence details, such as 6-weekly checks. He had never been in a situation like that before. He was busy dealing with an issue for another of his companies at the time and didn’t understand what was being requested.

Ms Hine asked why the invoice provided to TE Comer was to SGS when the one bearing the identical date and number accompanying his application to my office was to NPB. Mr Black told me that it was an error in the EMK office. EMK wasn’t being well managed. Because the money had come from SGS, there had been an assumption that SGS had bought the vehicle. It had been corrected the same day and a new invoice issued. I said that I normally found that the process was to raise an invoice, then pay it, not make a payment then produce an invoice some time later. Ms McCreesh told me that might be the general practice but there was nothing to stop creation of the invoice later. The agreement to buy the truck had been made on 18 June, invoice raised and the payment made.

Ms Hine submitted that I should not go behind the evidence that the payment was from SGS to EMK and there was an invoice and bank statement supporting that. Ms McCreesh said that the inconsistencies had been explained. The invoice to SGS had been raised in error by a company that was suffering mismanagement. Her client had supplied the money it; it didn’t matter whether that was through SGS or NPB. I reserved my decision on ownership.

5.2 Who was the operator of LK61AKO on 24 June 2021

Ms McCreesh told me that Mr Black had seen that EMK was in trouble and saw a business opportunity to buy it. He needed to move quickly. The driver hadn’t been aware. He wasn’t due to be paid until the end of the week. He would have been transferred to NPB at that time and paid by NPB.

Ms McCreesh took me to the driver’s interview where he states “EMK Trading Ltd gives me the order, NPB Contracts owns the vehicle”. Those orders were given at the direction of her client who owned the vehicle. Mr Black didn’t need to know the details of this journey. He was aware that the driver would be paid at the end of the week. The driver would not be aware of the sale of the business. She submitted that Mr Black had directed that EMK continue its ongoing business.

Mr Black had not understood what Ms Comer was asking for at the time of the call. Had he understood, he could have provided the relevant sale documents at the time.

I asked what due diligence Mr Black had undertaken and what processes he had gone through before putting the vehicle on the road. He conceded that the vehicle had not been properly inspected prior to entering service for NPB. The digital tachograph had not been locked in. Mr Black knew that the driver had a licence but had not checked it. He had not checked his tachograph. It was a rush job. He had met the driver previously. I asked for evidence that NPB was employing the driver. The girls would not have been able to draw up the contract so quickly; it was a small business. Ms McCreesh interjected that there was a verbal contract in place. I took Ms Mc Creesh to page 26 of the bundle, the driver interview, where he explicitly stated that he was employed by EMK. Ms McCreesh submitted that the driver “was not aware of the ins and outs of the purchase; the details weren’t shared with him”.

Mr Black told me that the driver had very little English. They had explained to him what was happening before he went out. He could not explain why Mr Paul did not know that when being interviewed apart from the driver’s poor English. He could not recall the drivers name because it was foreign so he couldn’t bring it to mind. Ms Hine put it to Mr Black that he didn’t know the name as he was not employing him. I asked whether he could recall the name now. Mr Black told me he could not. I noted that the driver was called Mr Paul, Sorin Paul, which wasn’t that difficult as names went. Mr Black could not comment further.

6. DETERMINATION AND DECISION

6.1 Ownership

The relevant evidence here includes the two invoices both numbered 639 and dated 18 June 2021. One is in the name of SGS and the other in the name of NPB. Mr Black told me that the invoice to SGS had been created in error because the administrators at EMK had misconstrued the payment from SGS as meaning that SGS was buying the vehicle. I was told that the invoice was back-dated after the payment was made, then a second invoice created and also backdated to the same date, four days before payment was made. I have to say that the manner in which invoices are claimed to have been created, back-dated, and then re-issued is deeply troubling and I attach limited weight to either document as a result. The only reliable evidence that I have is the bank statement provided by EMK which shows the transfer of money to EMK came from SGS. This is supported and sought to be explained by Mr Black’s evidence and Ms McCreesh’s submission that Niall Black chose to use the account of SGS for convenience. As I follow the chain of evidence, the bank statement moves the ownership of the vehicle from EMK to SGS. It goes no further.

I reject Ms McCreesh’s submissions that the two separate limited companies are in some way the same entity because they share the same director and shareholder and so their bank accounts can be used freely across the businesses. A company has a distinct legal personality apart from its shareholders or directors. The applicant here is NPB. I find that it was not the owner of the detained vehicle at the time of its detention. Neither the change of keeper slip nor the insurance document have any relevance to ownership. The application is refused.

6.2 Who was the operator?

Whilst I need not necessarily go on to consider the ground of appeal, I do so in case my finding on ownership is contested.

Section 58(2) of the 1995 Act states the following:

(2) For the purposes of this Act, the driver of a vehicle, if it belongs to him or is in his possession under an agreement for hire, hire-purchase or loan, and in any other case the person whose servant or agent the driver is, shall be deemed to be the person using the vehicle; and references to using a vehicle shall be construed accordingly.

Driver Sorin Paul was very clear at interview under caution (page 26) that he was employed by, and directed by, EMK. That was never in doubt in his mind. See particularly the screenshot of his telephone at page 32. The director of the applicant company, Mr Black, is also its transport manager. Transport managers are required to continuously and effectively manage the transport operation. Article 4(2)(b) of EU Regulation 1071/2009 (as adopted in UK law) requires, amongst other things, that the transport manager be responsible for “the assignment of loads or services to drivers and vehicles”. It is possible for this to be delegated and that is essential for operators with hundreds or thousands of vehicles. NPB is authorised for just two vehicles. For the transport manager to have no idea who was driving one of his two trucks, what the load was and where it was going, would be wholly unacceptable, if it were true.

Ms McCreesh, in one of her moments of giving evidence, told me that Mr Black had delegated that transport manager responsibility to EMK in some way so that their (illegal) operation could be continued and the business acquired as a going concern. She also told me that there was a verbal contract of employment between NPB and Mr Paul. Mr Black tried to some degree to support that assertion but could not say why, if such a contract existed, the driver appeared wholly unaware of it. I am also at a loss as to how he could say that he could not remember the driver’s name because it was foreign when his name was as simple as Mr Sorin Paul; even giving Mr Paul would have assisted the Examiner. It was further concerning that Ms McCreesh told me at one time that the driver was unaware of the sale, only later to tell me that there was an oral employment contract between NPB and the driver.

If Mr Black had delegated control of the driver and vehicle to EMK, then it remains EMK that is the operator and needs the licence as it is controlling the driver. Transport managers cannot delegate their statutory duties to third parties, only to natural persons employed by, or contracted with, the licensed undertaking (Article 4(2), EU Regulation 1071/2009).

I am required to make my findings on the balance of probabilities but also having in mind the overriding principle that, the more serious the allegation, the more cogent the evidence must be. The driver’s statement in interview under caution is strong evidence in favour of the proposition that EMK was the operator. Also supporting that is the lack of any employment contract between the driver and NPB and the fact that it is conceded that it was EMK that was directing the driver on the day in question. Further in favour of the applicant not being the operator is the concession that NPB had done none of those things expected of a licenced operator when taking on a new vehicle and a new driver. By that I mean that NPB did not have a first-use inspection carried out, the tachograph remained locked to EMK and the driver had not been interviewed nor had his tachograph checked. Mr Black also knew nothing of the driver nor the journey when asked by the Examiner at the time of the stop. Nor could he provide any documentary evidence of any relevant business transactions at that time. I do not accept his contention that he did not understand what was being asked. TE Comer’s statement is perfectly clear in relation to the questions she put to him.

It arises from Ms Comer’s statement (page 30) that the customers (that is, the owners of the cars being carried) contracted with EMK for transport. One customer was clear that the transport was by EMK whilst others said that EMK had sub-contracted the work to NPB. These were all customers who had been told to contact the examiner by Niall Black or by EMK and one is apparently aggrieved (I will not repeat the precise contents of Ms Comer’s statement but it is clear that they had fallen out with EMK). I find this of little assistance.

In favour of the contention that NPB was the operator, there is the oral evidence of Mr Black (and to a degree of Ms McCreesh) that he had taken over the operation two days previously and was, in effect, still getting the paperwork in order. There is the payment for the vehicle but that is only that, for the vehicle, not payment for contracts or the business or any other assets.

So I find overwhelmingly that the operator of LK61AKO on 24 June 2021 was EMK Trading Ltd. The application is refused.

Kevin Rooney

Traffic Commissioner, Western Traffic Area

24 September 2021