Decision

Decision for Gregory and Davis Transport Ltd (OF0230984)

Published 30 March 2023

This is my decision issued in relation to the Public Inquiry listed for 7 February 2023 in Cambridge. John Joseph Whelan (dob January 1973) and Dermont Jude Mernagh (dob March 1977) are the directors registered at Companies House. They did not attend, nor did CE Transport Law, solicitors, who had been acting on the operator’s behalf. They had notified in a letter dated 27 January 2023 that the directors had made the decision to apply to surrender the licence because the running of the company was no longer viable. The letter also stated that the directors would not be attending the Public Inquiry. It was respectfully requested that should the Traffic Commissioner revoke the licence under the mandatory grounds or any discretionary grounds that no negative findings against the directors or the company in terms of disqualification were made and that the repute of the company and its directors was “left to lie on file”.

The application to surrender was considered by the Traffic Commissioner, who refused the request on the basis that this Public Inquiry was pending. CE Transport Law were notified of this decision in an email from the caseworker dated 31 January 2023 and informed that the Public Inquiry would still proceed as listed. The operator was sent a copy of this letter in a further email from the caseworker sent on 1 February 2023 which also reiterated that the Public Inquiry would proceed. An email receipt was subsequently received.

Overall, I am satisfied that the operator and its solicitors were fully aware that the Public Inquiry would proceed if the directors did not attend and the company was not represented. Therefore, I have determined this case in their absence on the available evidence.

1. BACKGROUND

This standard international licence with a current authority of 40 vehicles (32 44 tonnes vehicles specified) and 40 trailers was granted on 19 March 1999. The directors had changed over time. There are currently two listed, Mr Whelan and Mr Mernagh, both appointed on 5 August 2016, although they were only recorded on this licence from 25 August 2020. Warren Martin Gregory (dob June 1968) had originally been appointed on 20 December 1999. He resigned on 10 August 2016 and was re-appointed the next day. He resigned on 27 August 2021. I also note from Companies House that Mr Whelan is recorded as the person with significant control (PSC) effective from 5 August 2016 and still remains so.

There are three operating centres recorded at Sunderland Estate, Kings Langley, WD4 8JU (28 vehicles and 28 trailers authorised); 15 Moon Hall Lane, Haverhill, CB9 8QT (12 vehicles and 12 trailers authorised) and Unit 1, Brill, HP18 9UB (10 vehicles and 10 trailers authorised). Maintenance is on a 12 weekly basis for vehicles and trailers with the company recorded as a maintenance provider, along with CCS Ltd, Kings Langley and New Ross VTN Ltd, County Wexford.

There is no transport manager recorded on the licence. The last transport manager had been Mr Paul Cookson appointed on 29 March 2022. However, the Central Licensing Office then wrote to the operator on 4 May 2022 stating that he had been accepted in error and had been removed from the licence. This was because Mr Cookson was also the transport manager for N20 Ltd OH2010122 and for Norman E Webb Ltd OH1001776. The combined fleet for all three licences was 64 vehicles.

This meant Mr Cookson’s appointment onto this licence breached the Senior Traffic Commissioner’s Guidance for a transport manager to work for a maximum of 4 operators with a combined total fleet of 50 authorised vehicles. It may well have been that Mr Cookson also worked with Road Transport Consultancy Ltd, since the correspondence on behalf of this operator with the DVSA regarding their investigation was on their headed notepaper and not the operator’s.

There had been an unsatisfactory investigation carried out by DVSA Traffic Examiner (TE) Karol Lukaszuk commencing in March 2022, with the initial report dated 14 April 2022. Subsequently a Public Inquiry report was prepared dated 3 August 2022 which is included in the brief.

The investigation had been triggered by a roadside check on 8 December 2021 by TE Young of vehicle KE13 VUP with both the vehicle and trailer liveried and insured by O’Leary International, a company registered in Ireland and based in County Wexford. The driver told the TE that he was employed by O’Leary International. A VOL check showed that the vehicle had been specified on this licence since January 2018. Questions were raised as to ownership of the operator company and possible lending of this operator licence to an Irish operator.

The DVSA’s subsequent investigation revealed that Mr Warren Gregory had resigned from his positions as director and transport manager in August 2021. However, these changes were not notified to the Office of the Traffic Commissioner (OTC) until 8 March 2022 in terms of the directorship or at all in relation to the transport manager. No application had been made for a period of grace to operate without a transport manager. Nor it seems did the operator employ one between August 2021 and February 2022, at which point Mr Cookson was proposed to be nominated and the TM1 submitted. For reasons already explained, he was removed from the licence on 4 May 2022. Notably, there was then no application for a period of grace.

On 11 November 2022 the operator eventually proposed for Liam Griffiths (dob September 1985) to be nominated as its transport manager. CLO wrote on 16 November 2022 in response asking for a signed TM1 and for an undertaking that within 3 months Mr Griffiths attended a CPC refresher course because he was not listed on any other licence and had originally qualified in 2013. However, the operator then proceeded to withdraw the application on the same day. Notably, there was no application for a period of grace.

The calling in letter was then issued on 4 January 2023. This included the indication that the Traffic Commissioner was minded to suspend the licence because it had been operating without a transport manager since August 2021. The operator was informed the suspension would go ahead unless it responded by 11 January 2023. In the meantime, a supplementary calling in letter with further grounds was also issued on 6 January 2023.

The operator responded by letter dated 11 January 2023 stating that Mark Roberts (dob July 1987) had been proposed as an external transport manager for 30 hours a week on a temporary basis whilst the company sought to employ a full time transport manager. They had shortlisted the applicants to three. It was acknowledged that they did not currently meet the mandatory requirement of professional competence, so they requested a period of grace.

The application was considered by a Deputy Traffic Commissioner, but not granted on the grounds that the maximum period to operate without a transport manager in these circumstances had long passed. However, the Deputy Traffic Commissioner stopped short of suspending the licence in advance of the Public Inquiry, most likely because it appeared that there was a least a temporary transport manager arrangement in place.

That decision was notified to the operator by email on 19 January 2023, stating the request could not be granted because the maximum six month period had already elapsed, but the Deputy Traffic Commissioner had refrained from suspending the licence in advance of the Public Inquiry. The email also explained the Deputy Traffic Commissioner directed that contractual arrangements with the proposed Transport Manager needed to be in accordance with Article 2 1071/2009 and that this would be explored in detail at the Public Inquiry.

CE Transport Law’s letter of 27 January 2023 was then received as set out above with the surrender request. Notably, no documents have been submitted in response to the request set out in the calling letter, including financial evidence which was to have been demonstrated for £183,500. Therefore, the only evidence is comprised in the brief. Given that the operator has not attended the hearing, it is deemed that the evidence in relation to the company is accepted.

2. EVIDENCE

The DVSA investigation had been triggered by a roadside check on 8 December 2021 by TE Young of vehicle KE13 VUP with both the vehicle and trailer liveried and insured by O’Leary International, a company registered in Ireland and based in County Wexford. The driver told the TE that he was employed by O’Leary International and provided his employment contract with other documents confirming this. He explained that he slept in the cab and did not have a regular base, so was warned about taking adequate rest.

Although the insurance certificate showed the vehicle was insured by O’Leary International, the address on the certificate was care of Gregory and Davis Ltd. A DVLA V5 document was also seen with Gregory and Davis Ltd recorded as the registered keeper. An Irish vehicle registration document with the same VIN showed the registered owner was O’Leary International. A VOL check showed that the vehicle had been specified on this licence since January 2018. Questions were raised as to ownership of the operator company and possible lending of this operator licence to an Irish operator.

TE Lukaszuk’s report dated 14 April 2022 followed on from a site visit on 16 March 2022 when Mr Cookson was acting as the transport manager before his nomination was approved. The TE concluded that numerous serious compliance issues had triggered the TE visit report (TEVR) that resulted in an unsatisfactory outcome. The TE stated that Mr Whelan who was interviewed at the visit had been appointed as director of this company on 5 August 2016.

There is a record of the interview under caution on 16 March 2022 with director Mr Whelan. He confirmed that the operator company had been acquired by O’Leary International around August 2016. He also stated that he “worked for O’Leary International and various other companies. I am also a director of Gregory and Davis Ltd which I think is important.”

It was accepted that vehicle KE23 VUP stopped on 8 December 2021 was liveried for O’Leary International with a phone number and website address leading to a company registered in the Republic of Ireland. Mr Whelan explained that “O’Leary International was the owner of Gregory & Davis Transport Ltd and Gregory & Davis is part of the group.”

The TE confirmed that Company House records showed that Mr Gregory had been a director from 20 December 1999 until 10 August 2016. He had then been reappointed the following day and resigned on 27 August 2021. The TE had tried to contact Mr Gregory on 11 January 2022, but had been told by Craig in the office that he had not been involved in the business of Gregory and Davis since he had resigned in August 2021. Mr Whelan was asked for his response to this statement.

Mr Whelan stated “Yes, he has not been in the office but he still is at the other end of the phone. He would probably not be dealing with Craig though.” Mr Whelan further stated that Mr Gregory was still “slightly involved in wages, but not in day to day operation. More of a consultant, we can call him when we need.”

Mr Whelan was then asked who had been carrying out the transport manager role since August 2021 and replied “It would be still Mr Gregory in this period, if there were any issues we would be contacting him for ask for an advice. He would not in the office but was on the other end of the phone.” When asked who was managing the day to day operations after August 2021, Mr Whelan replied “Mostly Craig and the UK desk in Ireland. There was also a transport consultant coming in monthly to produce the reports.”

In response to the question why the change of directors had not been notified to OTC, Mr Whelan replied “It is just a complete oversight to be honest unfortunately.” When asked why another transport manager was not appointed between Mr Gregory and Mr Cookson, Mr Whelan replied “We considered Craig but it did not work in the end and we decided to employ an external transport manager.” Mr Whelan accepted that the DVSA visit had “sped up things but our consultant pushed us to do the things quicker, to take someone on board and have someone in the office full time.”

The TE noted that Mr Gregory was still listed as the transport manager on the licence. This was despite the fact that he had seemingly stepped down from the role in August 2021. That change had not been communicated to the Office of the Traffic Commissioner. The directors stated this was due to an administrative error on their part. The TE concluded the operator did not employ a transport manager from August 2021 to 14 February 2022 when Mr Cookson was engaged. Notably there was no application for a period of grace in relation to this 6 month gap.

The TE recorded that the company’s head office was in the Republic of Ireland where the parent company, O’Leary International, was based. The planning was shared with some undertaken by 2 planners at the head office with another planner (Craig) based at the operating centre in Kings Langley. Better systems were required to ensure efficient planning and compliance in order to avoid future offences. The drivers’ records were also kept at the head office. Overall, the TE concluded this was not an effective system.

Significantly, the TE found evidence of a number of infringements between the period September 2021 and February 2022 relating to reduced daily and weekly rest and daily driving time too long. He concluded that the planning needed to be improved to avoid future offences. Driver card and unit downloads were not being undertaken on a regular enough basis. Infringements were not all signed for by the drivers, although Mr Cookson appeared to be implementing some system that he at least signed. However, it was essential that the drivers were interviewed and signed their infringements, but this had not taken place for a significant number.

The report confirmed that prohibitions had been issued for overloading on 21 November 2019, 1 March 2020 and 28 March 2022. One prohibition had been issued for a tachograph offence on 27 August 2019. These prohibition rates were considerably higher than the national average.

The records show that the annual test fail rate was slightly higher test fail rate than the national average. However, the primary failure items recorded related to brake performance, steering, emissions and tyres from 2019. Clearly had effective pre-test inspections been carried out these issues should have been resolved before the vehicles were presented for MOT.

The TE concluded that the overall outcome was unsatisfactory and the case was referred to the Office of the Traffic Commissioner. However, he did record that there was evidence that Mr Cookson was starting to implement adequate systems.

Notably, Mr Cookson was not formally approved as the nominated transport manager until 29 March 2022. As previously stated, subsequently the Central Licensing Office then wrote to the operator on 4 May 2022 stating that Mr Cookson had been accepted in error and had been removed from the licence. This should have prompted the company to apply for a period of grace, but they failed to do so.

On 11 November 2022 the operator eventually proposed Mr Griffiths to be nominated as its transport manager. CLO wrote on 16 November 2022 in response asking for a signed TM1 and for an undertaking that within 3 months Mr Griffiths attended a CPC refresher course because he was not listed on any other licence and had originally qualified in 2013. However, the operator then proceeded to withdraw the application on the same day. Notably, there was also then no application for a period of grace.

It was not then until 11 January 2023 in response to the indication that the Traffic Commissioner was considering suspending the licence, that the operator stated that Mark Roberts was to be appointed. However, the TM1 application form stated that Mr Roberts worked full time for Road Transport Consultancy Ltd and yet it also stated that he would be working 30 hours per week for the operator as an external TM (10 hours per day Wednesday to Friday). This raised concerns that Mr Roberts would be working for the operator through the consultancy firm and whether there was the required genuine and individual link with the operator pursuant to the requirements of Article 2 of the EU Regulation 1071/2009.

Even though the operator had indicated that Mr Roberts might only be contracted on a temporary basis, it appeared that he was not a suitable candidate. The operator was put on notice of this issue in the caseworker’s email of 19 January 2023. Ultimately, the application did not proceed and as of the date of the Public Inquiry there is no transport manager recorded on this licence.

3. FINDINGS

I make adverse findings in terms of the following grounds set out in the calling letter dated 4 January 2023;

a) Pursuant to section 26(1)(b) you have breached the conditions on your licence, namely :

• a failure to notify the Traffic Commissioner within 28 days of its occurrence of events which affect the management of the company;

• a failure to notify the Traffic Commissioner within 28 days of its occurrence of events which affect good repute;

• a failure to notify the Traffic Commissioner within 28 days of its occurrence of events that could affect the requirement of financial standing;

• a failure to notify the Traffic Commissioner within 28 days of its occurrence of events that could affect the requirement of professional competence

b) Pursuant to section 26(1)(e) the following statements you made when applying for the licence were either false or have not been fulfilled :

• that Warren Martin Gregory would be the transport manager responsible for vehicles on the licence;

• that you would abide by any conditions which may be imposed on the licence

No adverse findings can be made pursuant to section 26(1)(h) in relation to the two elements of material change set out, namely the requirement that the operator not be unfit to hold an operator’s licence and that there may no longer be sufficient financial resources to support the vehicles because due to an error these relate to restricted licence considerations. No other elements of material change were set out and so no adverse findings can be made under this section due to the error.

Furthermore, I make adverse findings in terms of the following grounds set out in the supplementary calling letter dated 6 January 2023;

• Pursuant to section 26(1)(c) your vehicles or drivers have been issued with prohibition notices by DVSA or the police in the past five years;

• Pursuant to section 26(1)(ca) you or your drivers have been issued with relevant fixed penalty notices in the past five years;

c) Pursuant to section 26(1)(f) you have not honoured the undertakings you signed up to when you applied for your licence , namely,

i. that your vehicles [and trailers] would be kept fit and serviceable;

ii. that your vehicles [and trailers] would not be overloaded;

iii. that you would observe the rules on drivers hours and tachographs and keep proper records;

iv. that you would keep records for 15 months of driver defect reports, safety inspections and routine maintenance and make them available on request;

There have been substantial and serious failings in relation to the mandatory requirement for a transport manager to be appointed and for the transport manager to have continuous and effective control of the transport operations.

I find that Mr Gregory effectively resigned as transport manager around 27 August 2021 when he also resigned as a director. I do not accept the evidence of Mr Whelan in his statement under caution that Mr Gregory continued on as the transport manager. As Mr Whelan stated, Mr Gregory was only available on the phone and even then seemingly he was only contacted by the operator for advice. The operator’s planner, Craig, based at Kings Langley, told the TE that Mr Gregory had not been involved since he had resigned as a director. Clearly, if Mr Gregory had been continuing to undertake the transport manager role, the planner would have known that he was doing so and would have confirmed this.

Even if Mr Gregory had notionally remained in post, I conclude there was undoubtedly not continuous and effective management of the transport operations. At best Mr Gregory was a transport manager of convenience. At worst, he had resigned and was not available even on the phone as Mr Whelan contended in his interview. There was also a breach of the condition of the licence to notify events that affected the professional competence mandatory requirement.

If indeed Mr Gregory had resigned as transport manager, this was not notified to the Office of the Traffic Commissioner and no application was made for a period of grace. Therefore, I find there was either an unauthorised period of operating without a transport manager from August 2021 until Mr Cookson was formally appointed until 29 March 2022, or alternatively, the company kept Mr Gregory’s name on their licence effectively as a transport manager of convenience. In either case, I find that there was a fundamental breach of the professional competence mandatory requirement.

I acknowledge that it was most unfortunate that Mr Cookson’s application was approved in error by Central Licensing due to the overall number of vehicles authorised on the licences on which he was appointed. Consequently, Mr Cookson was then removed from the licence on 4 May 2022. However, notably, the operator did not make at that stage make an application for a period of grace. Therefore, I find there was then an unauthorised period of operating without a transport manager from 4 May 2022.

On 11 November 2022 the operator eventually proposed Liam Griffiths (dob September 1985) to be nominated as its transport manager. CLO wrote on 16 November 2022 in response asking for a signed TM1 and for an undertaking that within 3 months Mr Griffiths attended a CPC refresher course because he was not listed on any other licence and had originally qualified in 2013. However, the operator then proceeded to withdraw the application on the same day. Notably, there was no application for a period of grace. Consequently, the operating unauthorised without a transport manager still carried on from 4 May 2022.

It was not then until 11 January 2023 in response to the indication that the Traffic Commissioner was considering suspending the licence, that the operator explained Mr Roberts was to be appointed. However, the TM1 application form stated that Mr Roberts worked full time for Road Transport Consultancy Ltd and yet it also stated that he would be working 30 hours per week as an external TM. This raised concerns whether there was the required genuine and individual link with the operator pursuant to the requirements of Article 2 of the EU Regulation 1071/2009. As it transpired, the application was not processed and so as of the date of the Public Inquiry the operator does not have a transport manager.

Therefore, in summary, since Mr Gregory resigned on 27 August 2021 and left the company it operated unauthorised without a nominated transport manager until 28 March 2022. In the alternative, Mr Gregory was simply a transport manager of convenience throughout that time. In addition, subsequent to Mr Cookson’s removal from the licence as transport manager on 4 May 2022 there has been a continuous period of unauthorised operating without a transport manager until now.

In addition, following on from the roadside check on December 2021, questions were raised as to the ownership of the operator company and possible lending of this operator licence to a foreign operator. However, no further evidence has been provided that can satisfy me there has been unlawful activity in this respect.

Overall, in terms of good repute, the total lack of professional competence compliance for a sustained period since August 2021 has meant that there has been an increased risk to road safety. This has been demonstrated particularly by both the maintenance and drivers hours issues set out in the TE’s report.

Furthermore, this operator has also gained a substantial commercial advantage. This is because it has failed for a considerable time to comply with the mandatory requirement to engage a transport manager when clearly compliant operators are spending both time and money doing so.

Therefore, these fundamental and serious professional competence failings, combined with the other adverse findings, lead me to conclude that the company has lost its good repute pursuant to section 13A(b).

No financial evidence had been provided to demonstrate the required £183,500, so it follows this mandatory ground has not been met pursuant to section 13A(c).

Since the company’s request for a period of grace to operate without a transport manager made on 11 January 2023 was rejected and the nomination of Mark Roberts has not been approved, it follows the mandatory ground of professional competence has not been met pursuant to sections 13A(d) and 13A(3)(a).

4. DECISION

I am required to formulate a proportionate approach in accordance with the principles set out by the Upper Tribunal in Bryan Haulage (No 2) (UT2002/217) to the question “is the conduct such that the operator ought to be put out of business?”

The Upper Tribunal has indicated that it is helpful to consider the preliminary Priority Freight question (UT2009/225) of “how likely is it that this operator will in future operate in compliance with the operator’s licensing regime?” However, in this case, the operator has applied to surrender the licence, so this question does not arise in practice.

Even if that had not been the case, I am satisfied that the series of adverse findings I have made result in the resounding conclusion these directors and this operator could not be trusted to be compliant. This is especially given the lengthy periods without a nominated transport manager and the lack of continuous and effective management of the transport operations, even when one was purportedly in place.

In any event, there are adverse findings regarding the three mandatory requirements of good repute, financial standing and professional competence that require me to revoke the licence.

Factoring in the adverse findings in terms of the discretionary grounds as well, the balancing exercise has fallen fully on the side of negatives. The outcome has been a complete breakdown of trust between the Traffic Commissioner and this operator. Indeed, there are no substantive positives to consider because the directors did not attend to provide any explanation for their conduct.

Therefore, in terms of Bradley Fold question, the company deserves to be put out of business, regardless of its request to surrender its licence.

I note that subsequently a completed and signed surrender form has since been received by Central Licensing on 21 February 2023, accompanied by a letter from the operator dated 7 February 2023. However, for the reasons already set out, this surrender request is not accepted.

In conclusion, I direct pursuant to section 27(1) Schedule 3(8) and Article 3 of Regulation (EC) No 1071/2009 that the standard national operator licence OF0230984 Gregory and Davis Ltd is revoked.

Unfortunately, there has been a delay in my written decision being issued and so I direct the effective date of the revocation is from 23.59 hours on 28 February 2023.

I have specifically requested that the DVSA and the Police employ their ANPR and on-road resources to identify and stop any vehicles being operated by the company after the revocation date. Any vehicle found to be carrying goods for hire or reward on a public road after this time would be liable to be impounded.

Mr Whelan and Mr Mernagh should understand that in addition I came close to disqualifying the company and them as directors due to the serious transport manager failings. However, by a narrow margin I have stepped back from doing so particularly because of the offer to surrender the licence.

Furthermore, both directors should also be aware that should they wish to re-join the industry and apply in the future in any capacity for an operator licence, they will need to demonstrate that they have undertaken additional education and that they are also fully committed to operator compliance in order to establish a satisfactory level of good repute.

Gillian Ekins

Deputy Traffic Commissioner

Eastern Traffic Area

28 February 2023