Decision

Decision for ERS Logistics Limited (OC2058120) & Transport Manager Emma Louise Corbett

Published 31 July 2024

0.1 In the North-Western Traffic Area

1. Written Decision of the Deputy Traffic Commissioner

2. Public Inquiry held on 9 July 2024 at Golborne

2.1 Operator: ERS Logistics Limited (OC2058120) & Transport Manager Emma Louise Corbett

3. Introduction

ERS Logistics Limited (“the Operator”) has held a Standard National Goods Vehicle operator’s licence authorising the use of 2 vehicles since 2 September 2022. There is one vehicle currently in possession.

The sole director of the Operator at the time of the application was Emma Kirkham (née Poole). Emma Jane Corbett was appointed as an additional director in January 2023.

The original Transport Manager was removed in September 2023 and Ms Corbett was appointed as the new Transport Manager in December 2023.

In April 2023 the Operator applied to vary the licence by increasing its authority to 4 vehicles and changing its operating centre from a previous address in Leigh to Unit 2, Platt Fold Street, Leigh. The change in operating centre was granted in interim form in April 2024 but the determination of the variation application in full has been held in abeyance until this Hearing.

The variation application prompted questions to be asked about the circumstances in which the licence had been sought initially and the links between the Operator and a previous operator licence holder.

Information was subsequently received that the Operator’s Director and Transport Manager Emma Corbett was married to a Thomas Mark Poole. Mr Poole is sole director of a company called ETA Waste Management Ltd which is engaged in skip hire. That company does not hold an operator’s licence. The information provided ahead of the Public Inquiry indicated that a significant part of the business of ERS Logistics Limited was the carriage of skips for ETA Waste Management Ltd.

Mr Poole was called to Public Inquiry on 15 February 2023 as Director of an operator licence holding company named Enviroblast ICS Ltd. Mr Poole had recently acquired the company and it appeared that he was using the licence for the purposes of another company of which he was director namely ETA Skip Hire (NW) Ltd. The findings that I made at the Hearing resulted in the revocation of Enviroblast ICS Ltd’s licence and the disqualification of the company and Mr Poole in person from holding an operator’s licence for 2 years until 17 March 2023. ETA Skip Hire (NW) Ltd’s application for its own operator’s licence was consequently refused.

In view of this background and the apparent business and personal links between this Operator and Mr Poole, concern was raised that this licence was a front for Mr Poole’s business and the Public Inquiry was called to further consider this issue.

Additionally, DVSA examiners provided reports that raised concerns about the Operator’s compliance in relation to vehicle and driver management, that also fell for consideration at the Public Inquiry.

4. The Call to Public Inquiry

The Operator was called up to Public Inquiry by letter dated 20 February 2024.

The call-up letter gave notice that the grounds for regulatory action in Sections 26(1)(b), 26(1)(e), 26(1)(f) and 27(1) of the Goods Vehicles (Licensing of Operators) Act 1995 (“the Act”) were to be considered as well as the provisions for disqualification in Section 28 of the Act. The letter also gave notice that the variation application would be considered subject to the provisions of Section 13A and 13C(4) of the Act.

Transport Manager Corbett was called up to Public Inquiry by letter of the same date that gave notice of consideration of the requirement of good repute and professional competence in Schedule 3 of the Act.

The Public Inquiry was originally due to be heard on 4 April 2024 but was postponed to allow for the attendance of Traffic Examiner McCabe.

5. The Public Inquiry

The Public Inquiry was heard at Golborne today. The Operator was represented by director Emma Corbett (also appearing as Transport Manager). The Operator and its directors were legally represented by Scott Bell of JMW Solicitors LLP. Transport Consultant Grahame Robinson was also present for the Operator. Traffic Examiner (‘TE’) Aiden McCabe appeared as a witness.

6. Evidence

Emma Corbett gave evidence at the Hearing today. She explained that in 2021 she was seeking an alternative to her full-time teaching job so she could have a better work/life balance and more time with her young children. Miss Corbett identified an opportunity to establish a business to provide haulage services for the skip hire industry, a sector known to her through her husband and other family members. Miss Corbett said she was aware that Mr Poole had been disqualified from operating his own vehicles and was having to rely on external contractors. She denied that Mr Poole had instigated the creation of the company or its application for a licence.

Miss Corbett explained that Ms Kirkham was Mr Poole’s sister and she had provided the initial funds for the business. Ms Kirkham was appointed director to reflect her investment and was involved in the initial paperwork. Miss Corbett could not clearly explain why she was not named as a director from the outset but denied that it was to conceal the link between her business and Mr Poole. Miss Corbett explained that she retained her maiden name as her name for official purposes and that there was no intention to conceal her marriage to Mr Poole. Ms Kirkham’s investment has now been repaid and she will shortly be removed as director.

Miss Corbett said she set the rates for payment for her customers and accepted my calculation that 94% of the Operator’s income over the last 3 months was derived from providing skip haulage to ETA Waste Management Ltd. The work for other customers is minimal.

Miss Corbett confirmed that she was solely responsible for managing the licence. Evidence was provided that the drivers were contracted to and paid by the Operator. Similarly, all the evidence relating to vehicles supported the assertion that they were the responsibility of the Operator. There was no evidence provided to suggest that Mr Poole was involved in instructing drivers or other management tasks for the Operator. He had sporadically driven for the Operator and Miss Corbett admitted that he had not been paid on those occasions. The evidence indicated ETA Waste Management Ltd was paying a market value rate for the haulage services provided by the Operator. There was no evidence to indicate that Mr Poole of ETA Waste Management Limited were recouping those payments in any way. I noted that Miss Corbett was taking a modest salary from the business.

Miss Corbett accepted that when she spoke to TE McCabe in December 2023, she had not immediately volunteered that she was married to Mr Poole. She disputed TE McCabe’s recollection that she described Mr Poole as a family friend. I do not consider it necessary to reach a determination on that narrow point. In the absence of a verbatim written record, I am satisfied that overall, Miss Corbett and Mr McCabe’s recollection of that wider conversation was sufficiently consistent for me to be able to form a settled view of what was said.

Miss Corbett said that there was no intention for Mr Poole to become involved in running ERS Logistics Limited in future, nor for her to become involved in running ETA Waste Management Limited. Indeed Miss Corbett, indicated that she would be willing to offer an undertaking to that effect. (I do not consider it necessary to record such an undertaking but nevertheless give weight to the fact it was offered).

Miss Corbett said she had become dissatisfied with the service provided by the previous Transport Manager and had therefore studied for the qualification herself. She admitted she had made some errors in her management of the licence and had engaged the services of Mr Robinson to assist her going forward. Miss Corbett has also booked to attend OLAT and drivers’ hours training courses in the coming weeks.

Miss Corbett confirmed she no longer wished to pursue the application for an increase in vehicles. The circumstances have changed since the application was made last year and she recognised that the Traffic Commissioner would need further reassurance about compliance before considering such a variation.

7. Decision

I have reminded myself that when considering action against an existing licence (as in this case), the burden is on the Traffic Commissioner to be satisfied that the requirements are no longer met.

I have also considered the guidance offered by Statutory Document No.1 in relation to the practice known as “fronting” and I have read the judgment of the Upper Tribunal in Sana Aziz 2016/044 where it was made clear that where fronting concerns are raised then an applicant (or operator) will need to do more than make bare assertions and rely on their good character to satisfy a Traffic Commissioner that there will be “clear blue water” between the operator and the entity without an operator’s licence.

Finally in terms of general guidance, I have considered the provisions of Section 58 of the 1995 Act and Section 81 of the 1981 Act that deem the user of a vehicle to be the driver, if he/she owns it, or, in any other case, the person who employs/contracts the driver.

Applying those provisions, I am satisfied that ERS Logistics Limited is the user of the vehicles authorised under its licence. I do not consider that there is evidence that any other person or entity is responsible for the employment and instruction of drivers or the operation of the vehicles.

Further, I do not find that Mr Poole is a controlling mind or otherwise significantly involved in the Operator’s management. His involvement appears to be restricted to that of an external customer, save for sporadic driving duties. I note that the DVSA in their examination of the Operator’s records did not find any evidence to indicate Mr Poole had a more influential role in its management. The same is true of the bank evidence that supports the Operator’s assertion that Mr Poole is an arm’s length customer.

Mr Poole was disqualified from holding an operator’s licence until March 2023. Even though the disqualification has ended, he would still be expected to persuade a Traffic Commissioner of his fitness were he to seek an operator’s licence in his own name or as a director in future. That said, the restriction on Mr Poole holding an operator’s licence does not prevent him from using an external contractor to meet the transport needs of his business. This is provided that any such arrangement meets the “clear blue water” test as envisaged by the Aziz judgment. It is also not necessarily improper for another licence holder to take advantage of the opportunity that may be presented if a business loses the right to operate its own vehicles (again provided any such arrangement is lawful).

I am not satisfied that there is sufficient evidence of fronting in this case. I consider that Miss Corbett has done enough to demonstrate that the Operator is an independent entity that she manages without direction from Mr Poole. The Operator is clearly heavily dependent on the business of ETA Waste Management Limited but neither that fact nor the personal relationship between the respective directors is sufficient to support a finding of “fronting”.

Further I do not consider there is any evidence that false or misleading information was provided to the Office of the Traffic Commissioner during the initial application for a licence or on the variation application. I do find it is more likely than not that Miss Corbett delayed her formal appointment as director of the Operator to avoid the potential scrutiny that may have followed had her connection to Mr Poole become known sooner. I balance this with the fair point made by Mr Bell, that had Miss Corbett been named a director sooner, the link may still not have been made as she was properly using her maiden name. I also find that Miss Corbett was reticent about disclosing the true extent of her relationship with Mr Poole when she was visited by the DVSA.

Whilst I consider Miss Corbett was motivated by a wish to be distanced from Mr Poole to avoid the inevitable scrutiny that his potential involvement would have attracted, I do not consider that she intentionally misled the Traffic Commissioner. I reach that conclusion as I am satisfied that this licence is not a front for Mr Poole.

Consequently, whilst I consider that Miss Corbett’s good repute (as director and Transport Manager) is tarnished by her conduct, I do not find it is lost. I do however issue a Formal Warning and would urge Miss Corbett to reflect on the importance of being open and transparent in all future dealings with the Traffic Commissioner, so the relationship of trust is preserved.

I find that the Operator has also fallen short in relation to its compliance in the past. This relates to vehicle maintenance standards and monitoring of driver’s hours as identified in the DVSA reports and conceded by Miss Corbett. I acknowledge that these issues are not untypical of a new and inexperienced Operator. I also acknowledge that the initial DVSA reports relate to matters that arose prior to Miss Corbett’s appointment as Transport Manager.

I have balanced the negative features of those failings with the positive features that Miss Corbett understands what she needs to do to improve and has sought further training and the assistance of a transport consultant to do so. Accordingly, I consider that aspect can be addressed by the recording of a Formal Warning supported by the audit undertaking (in view of Mr Robinson’s continued role in advising the Operator, I would ask that he does not complete the audit on this occasion).

Gerallt Evans
Deputy Traffic Commissioner

9 July 2024