Decision

Decision for Daniels Transport Group Ltd

Published 8 December 2023

0.1 EAST OF ENGLAND TRAFFIC AREA

1. DECISION OF THE DEPUTY TRAFFIC COMMISSIONER

2. PUBLIC INQUIRY HELD IN CAMBRIDGE ON 6 NOVEMBER 2023

2.1 OPERATOR: DANIELS TRANSPORT GROUP LTD LICENCE OF2033691

3. Background

Daniels Transport Group Ltd holds a standard international goods vehicle operator’s licence (OF2033691) for four vehicles and 15 trailers. The licence was granted in July 2020, originally for eight vehicles and 15 trailers. The sole director of the company is John Robert Daniels: he is also the nominated transport manager on the licence.

3.1 2022 Public inquiry

Daniels Transport Group Ltd was called to a public inquiry on 25 October 2022 primarily owing to failure by the partnership of John Daniels and son Ben Daniels to surrender its licence OF1147221 as promised upon grant of this licence to Daniels Transport Group Ltd. Indeed, the partnership proceeded to renew its licence and operate six vehicles on it, when the true operating entity was Daniels Aggregates Ltd.

That inquiry also considered the company’s roadworthiness related prohibitions and a concerning MOT failure rate (24% first time failures) over the two years of the licence’s existence. I found the following additional issues of concern:

• there were only very intermittent maintenance records for the previous 15 months; most vehicles had only three or four preventative maintenance inspection (PMI) records over that period when I would have expected 10 or 11 (PMIs were supposed to be happening every six weeks); roller brake test (RBT) records were even sparser;

• the driver defect reporting system was not functioning properly: drivers were reporting defects on an app but no record of how these defects were resolved (or if they were resolved) was kept;

• transport manager John Daniels was clearly failing to exercise continuous and effective management of the business. He was not looking at maintenance records, not checking to see whether PMIs or RBTs were being carried out, not looking at driver defect reports, and was oblivious to fact that the partnership licence was operating in the wrong entity and should have been surrendered as he had promised.

In my decision I noted that, given the shortcomings listed above, I would normally either have suspended the licence for a considerable period of time or have revoked it altogether. However, in this particular case there were some mitigating factors of a personal nature which it was not necessary to detail in a publicly available document. I therefore confined myself to issuing a formal warning and seeking – and receiving – undertakings from the operator and John Daniels personally. The company undertook to have an independent compliance audit carried out by 30 April 2023 and to submit its detailed proposals for implementing the audit’s recommendations within 14 days of receiving the audit report. It also undertook to provide evidence of financial standing for eight vehicles by 10 February 2023 (the company had been unable to show the required financial standing at the inquiry). In addition, John Daniels gave a personal undertaking to me that he would either i) step down as transport manager and find a replacement by 31 May 2023 or ii) requalify as a transport manager before the same date by taking and passing the CPC exam.

4. Further developments

The deadline of 10 February 2023 passed without the company submitting information on its financial standing, as it had undertaken to do. A chasing email had to be sent by the office of the traffic commissioner on 9 March 2023. The financial information which was then provided showed that the operator had sufficient funds to support only four vehicles rather than the eight on its licence. As I had warned the company at the inquiry I would do, I then curtailed the company’s licence to four vehicles. I noted that the company had stated to me at the inquiry that it would liquidate assets in order to achieve financial standing for eight vehicles: clearly it had failed to do this.

April and May 2023 came and went without the company providing any information about the independent audit or which of the options as transport manager Mr Daniels had chosen and put into effect. A chasing letter was sent from the traffic commissioner’s office on 12 June 2023. In an email dated 19 June 2023, Mr Daniels replied that he had not put into effect either of the transport manager options as he was planning to sell the business. He attached a copy of an audit carried out by the RHA on 20 April which had been sent to him on 15 June 2023. The audit had highlighted a fairly long list of concerns, including:

• use of AdBlue was not being recorded;

• no first use check of customers’ trailers was being carried out;

• no records were kept of driver CPC cards or driver tachograph cards;

• there was no system in place for monitoring driver CPCs;

• driver detectable defects were being found on PMI records;

• no gate checks were carried out on drivers to monitor the quality of their walk-round checks;

• the auditor had been unable to review 15 months’ worth of records;

• the PMI intervals of six weeks were being exceeded;

• brake performance assessments were not being recorded on every PMI sheet;

• laden roller brake tests were not being carried out four times a year (the minimum recommended in DVSA’s “Guide to Maintaining Roadworthiness”).

Mr Daniels did not provide any proposals for implementing the audit’s recommendations, contrary to the undertaking given.

In the light of this audit, and the operator’s failure to fulfil the undertakings given, the senior traffic commissioner caused a “propose to revoke” letter to be sent to the company on 25 July 2023. The company duly requested that a public inquiry be held.

5. Public inquiry

Call-up letters were sent on 15 September 2023 both to the company and Mr Daniels in his capacity as transport manager. The letters cited Section 26(1)(e), (f) and (h) and Section 27(1) of the 1995 Act.

The public inquiry took place in Cambridge on 6 November 2023. Present were John Daniels and Andrew Woolfall, solicitor from Backhouse Jones, representing both the company and Mr Daniels. The inquiry considered the following issues:

• Mr Daniels’ failure to fulfil his personal undertaking to find a new transport manager by 31 May 2023 or retake and pass the TM CPC exam by this date. Mr Daniels explained that he had acquired the home study pack for the CPC exams but had otherwise been “focused on the priority of keeping the company going”;

• the failure to return the audit with the operator’s proposals for implementing its recommendations. Mr Daniels said that he had been “too busy” to produce proposals;

• the failure to fulfil the undertaking to produce evidence of financial standing over the period 1 November 2022 to 31 January 2023 by 10 February 2023. When, after chasing, finances were produced they were inadequate, despite the company’s assurances at the October 2022 public inquiry that assets would be sold to raise money;

• the RHA’s audit found some eight week gaps between PMIs. These extended intervals continued even after the audit report had been made available. Mr Daniels explained that the reason for one gap was that vehicle was in Scotland for two weeks and could not be brought back (or inspected in Scotland) because it was needed in service. He had no explanation for the other instances;

• at the October 2022 public inquiry I had found (amongst other things) that Mr Daniels was not looking at the PMI sheets. There was strong evidence that he continues not to do so: many PMI records which I looked at this time did not sign the vehicle off as roadworthy; many omitted details on tyre treads and pressures or both; many simply “reported” defects to Mr Daniels, with no evidence of rectification. There were still numerous driver detectable defects, including a 1mm tyre;

• five months after the RHA audit recommended that gate checks be carried out on drivers, this was still not being done;

• vehicle GM16 NFK had been put back on the road on 10 July 2023 but had not been specified on the licence until 17 August. The licence already had four vehicles specified on it between these dates, prompting the likelihood that more vehicles were operated than authorised;

• there was only one PMI record for vehicle YH63 CVN, although it had been specified on the licence for all but two of the past 15 months;

• vehicles had been off the road (VOR) and then put back on road without an inspection. Mr Daniels claimed that they had been given PMIs before re-entering service but there was no evidence of this;

• the MOT first-time pass rate since the last public inquiry was poor (33% or two out of six presentations);

• there was a gap of four months (1 May to end August) in drivers’ hours records, infringement reports, missing mileage reports. Mr Daniels said that this was caused by moving from the expensive Webfleet monitoring system to the RHA’s system. He could not explain why the move from one system to another should involve such a long gap;

• missing mileage reports showed sometimes substantial instances of driving without a card - eg 2 hours 10 minutes in one week. These instances had not been investigated;

• some drivers had very high levels of drivers’ hours infringements. Mr Daniels said that they had been given verbal warnings, but there was no evidence of those;

• an experienced transport manager, Mr Crysell, had been found who was willing to be nominated on the licence. I was shown an email dated 5 November 2023 (i.e. the day before the inquiry) in which he informed the operator that he would be prepared to act as transport manager but that much needed to be done;

• Mrs Daniels, who had been presented to me at the October 2022 public inquiry as a positive element in that she would take much of the administrative burden from Mr Daniels’ shoulders, had in fact returned shortly after the inquiry to working full-time in education.

5.1 Closing submissions

Mr Woolfall said that Mr Daniels would accept that he had not been fulfilling the transport manager role properly. He had been prioritising the need to keep his business afloat. He had at one point planned to sell the business but this had not come to fruition. On the positive side, he had taken on a transport administrator (in place of Mrs Daniels) and put her through the RHA’s transport administrator course. He had looked for a new transport manager and had now identified the experienced Mr Crysell, admittedly somewhat late in the day. Mr Daniels recognised that this was his very last chance, but he could now be trusted to take matters forward. He was prepared to resign as the transport manager immediately. A further audit had already been booked for 30 November and another one could be arranged for spring 2024.

Mr Woolfall accepted that the degree of non-compliance came at the higher end of the severe to serious category. If the licence were revoked, it would mean the end of the business (the transport of sugar beet). If the licence were suspended this would have an adverse impact as it was the height of the sugar beet season. He asked that I take into account the operator’s failings against the background of someone trying to save his business in the context of difficult family circumstances.

6. Findings

After considering all the evidence, I make the following findings:

the company has failed to fulfil its promise that vehicles would be given a safety inspection every six weeks. Gaps of up to eight weeks were noted not only on the RHA audit in April 2023 but also since then. Only one safety inspection report was available for vehicle YH63 CVN, although it had been on the operator’s licence for 13 out of the last 15 months (Section 26(1)(e ) of the 1995 Act refers);

the company has failed to fulfil its undertakings (Section 26(1)(f) refers) given at the public inquiry in October 2022 to:

• submit evidence of financial standing for eight vehicles by 10 February 2023. Financial standing evidence was not submitted until March 2023, after the operator was chased. Financial standing was sufficient for only four vehicles;

• have an independent audit carried out by 30 April 2023 and provide detailed proposal on how it intended to implement the audit’s recommendations. While the audit was carried out by the RHA in April 2023 it was not submitted by the company until June 2023 (after being chased). The company was “too busy” to attend to that part of the undertaking relating to proposals for implementing the audit’s recommendations.

John Daniels has failed to fulfil his undertaking that he would either requalify as a transport manager or step down as such by 31 May 2023. He did neither, simply carrying on as transport manager in breach of his undertaking;

the company has also failed to fulfil its undertakings:

• to ensure that vehicles are fit and roadworthy (there has been a 66% first-time MOT failure rate since 25 October 2022, with vehicles failing on aim of headlamps, road wheels and hubs and brake systems and components);

• to ensure the observance of rules relating to drivers’ hours and tachographs. Drivers have driven without a tachograph card and have committed drivers’ hours infringements. There is a four month period for which no drivers’ hours records are available. The transport manager failed to address these issues;

• to ensure the lawful operation of vehicles. A vehicle GM16 NFK was operated for more than a month without being specified on the licence, at a time when the licence had no margin. The operator has therefore also operated beyond its authority.

John Daniels has failed to exercise the required continuous and effective management of the transport activities of the business. The failures listed above occurred on his watch. Despite the public inquiry in October 2022 finding that he was exercising insufficient control (see paragraph 3(c) above) and warning him about this, there is no sign of any improvement. Indeed, as Mr Daniels himself accepts, his prime concern was keeping the company afloat rather than ensuring compliance.

7. Consideration

7.1 Balancing act

I weighed up the negative against the positive issues. On the negative side were the above findings. On the positive side are the fact that a potential new transport manager has been sourced, that a transport administrator has been put through an RHA training course, and that further audits have been offered. I consider that the negatives heavily outweigh the positives.

7.2 Trust

Had Mr Daniels informed me at the public inquiry in October 2022 that he would proceed to ignore his personal undertaking to me about requalifying or stepping down as transport manager and that the shortcomings discussed at that inquiry would continue largely unaddressed, then I would have revoked the licence at that point. I bent over backwards to take account of Mr Daniels’ family circumstances, saying that I did not want “to kick a man when he was down”. But in proceeding to ignore all the promises made at that inquiry, Mr Daniels has shown that the trust I showed in him to put matters right was entirely misplaced.

7.3 Loss of good repute as transport manager

Mr Daniels has failed to exercise continuous and effective management of the transport activities of the business and has broken promises he personally as transport manager made. The operation he supervises remains non-compliant in a wide range of areas. I therefore cannot avoid a finding that he is not of good repute as transport manager (Section 27(1)(b) of the 1995 Act refers). In these circumstances, revocation of the licence is mandatory unless I find that it would be appropriate to allow a period of grace in which to appoint a new transport manager.

7.4 Period of grace inappropriate

The name of a new potential transport manager was given to me only on the day of the inquiry (6 November 2023) and I was shown an email from that person dated 5 November. It is clear that the effort to find a new transport manager has only been made at the last minute. In the circumstances, I do not believe it appropriate to allow a period of grace. I remain unconvinced that Mr Daniels, when faced with a choice between the convenience of his business and the advice of a transport manager, would choose the latter. History suggests strongly that the former takes precedence with him.

7.5 Priority Freight and Bryan Haulage questions

I asked myself if I could trust this operator to be compliant in the future (the Priority Freight question). The answer is an emphatic no. Almost all of the issues identified at that inquiry remain: some have got worse. The issues identified in the audit have gone largely unaddressed. The operator has shown in its conduct since the October 2022 public inquiry that it cannot be so trusted. The company is not of good repute (Section 27(1)(a) refers).

A negative answer to the Priority Freight question tends to suggest an affirmative answer to the Bryan Haulage question of whether the operator deserves to go out of business. The scale and range of the shortcomings found both in the audit and at the public inquiries, and the fact that the operator has prioritised commercial considerations rather than fulfilling its undertakings and complying with the law, leads me to conclude me that it does.

8. Decisions

8.1 Operator licence

In the light of the conclusions set out above, I am revoking the licence under Section 26(1)(e), and (f) and Section 27(1)(a) and (b) of the 1995 Act. The revocation will take effect at 0001 hours on 20 December 2023, to give the operator time to wind down the business.

8.2 Disqualification of Daniels Transport Group Ltd and John Robert Daniels as operator

For the reasons outlined above, and having performed the same balancing act, I conclude that both the company and director John Robert Daniels should be disqualified under Section 28 from holding or obtaining an operator’s licence in the future and (in Mr Daniels’ case) from being the director of any company holding or obtaining such a licence. In deciding upon the length of the disqualification, I have taken account of paragraph 108 of the Senior Traffic Commissioner’s Statutory Guidance Document 10. This states that for a first inquiry a disqualification of between one and three years could be appropriate. In serious cases where, for example, there are persistent operator licence failures, a disqualification of between five and ten years may be merited. This is the operator’s second inquiry. But because I have not made any findings of any falsification of records or deliberate encouragement of drivers to break the law or go beyond their hours, I am imposing a disqualification period of three years, at the higher end of the range for a first public inquiry. The disqualification will run from 0001 hours on 20 December 2023 to the same time on 20 October 2026.

8.3 Disqualification of John Robert Daniels as transport manager

Having removed his good repute, I must also disqualify John Robert Daniels from acting as transport manager on any operator’s licence (paragraph 16 of Schedule 3 refers). For similar reasons as set out in the above paragraph, I am disqualifying him for three years, with immediate effect and until 0001 hours on 20 November 2026.

8.4 Period of grace

Daniels Transport Group Ltd no longer has professional competence (Mr Daniels having been disqualified as a transport manager). I will allow a short period of grace to operate without a transport manager until the revocation of the licence takes effect at 0001 hours on 20 December 2023.

8.5 Nicholas Denton

Deputy Traffic Commissioner

20 November 2023