Decision

Decision for JLS Outdoor Media Ltd (OC1144126) and Transport Managers David Bryan Harris & Richard George Iddon

Published 10 February 2021

IN THE NORTH WEST OF ENGLAND ## DECISION OF THE TRAFFIC COMMISSIONER

0.1 JLS OUTDOOR MEDIA LIMITED

OC1144126

0.2 TRANSPORT MANAGERS

DAVID BRYAN HARRIS & RICHARD GEORGE IDDON

In the matter of the Goods Vehicles (Licensing of Operators) Act 1995 (the Act)

1. Background

JLS Outdoor Media Limited (“JLS”) is the holder of a standard national goods vehicle licence issued in 2016 and authorising the use of two vehicles and two trailers.

The operator was called to a public inquiry on Thursday 21 January 2021 as result of four matters:

• On 12 November 2019 a vehicle NX09 DXG registered under the licence was stopped and found not to have a valid MoT test certificate. The previous certificate had expired on 28 February 2019;

• This resulted in investigation of the operator and visits to its premises by DVSA Traffic and Vehicle Examiners in early 2020. Both investigation reports contained unsatisfactory findings;

• The Transport Manager at the time of the above matters, David Bryan Harris, resigned his post and there were concerns about whether he had exercised continuous and effective management of the licence;

• Examination of the operator’s affairs raised questions about the involvement of an individual named Nigel Brunt and his associated companies in the management of the licence.

The public inquiry was conducted virtually by video link. The operator was represented by its sole director James Adam John Goulding (also known as “Jay”) and its nominated new Transport Manager, Richard Iddon. The operator was professionally represented by Transport Consultant Charlie Ahmed.

The former Transport Manager David Bryan Harris did not attend. He responded to the call-in letter by saying he could not afford to take time off his work as a European HGV driver to attend the hearing. He offered some explanation of his position which was discussed at the public inquiry. Mr Harris was made aware the hearing would continue in his absence and he indicated he would accept the decision of the Traffic Commissioner.

I indicated at the start of the hearing that I would take Mr Harris’ representations into account but that the weight I gave to his evidence would also take into account the fact that the operator and I had been denied the opportunity to hear from Mr Harris in person and further question him.

Traffic Examiner (TE) Andrew Rea and Vehicle Examiner (VE) Andrew Sefton also attended virtually to give evidence. Mr Ahmed on behalf of the operator indicated that the written evidence of TE Susan Ainslie (who stopped the operator’s vehicle on 12 November 2019) and that of TE Rea (who undertook the traffic investigation) was agreed. Similarly the Maintenance Investigation Visit Report of VE Mark Hirons was agreed (VE Sefton appeared on behalf of VE Hirons).

Prior to the hearing I considered written representations made by Mr Ahmed which Mr Goulding confirmed accurately reflected his instructions. I was also provided with documents relating to the recent maintenance of the vehicles and bank statements in the name of JLS for the period from 7 September 2020 to 7 December 2020.

I was satisfied that the bank statements showed sufficient evidence of the required financial standing, but I was concerned about the contents in terms of the operator’s repute and its relationship with other entities.

The operator, Mr Goulding and Mr Harris had not previously been called to a public inquiry or been the subject of any regulatory action.

2. Evidence

2.1 Relationship with other Companies

Mr Goulding gave evidence explaining the background to the company obtaining the licence.

He had formed the company in 2009 with a view to developing a business involved in erecting outdoor advertising. It was an industry in which his brother-in-law, Nigel Brunt, was already established under the corporate banner of “Titchfield.”

Mr Goulding explained that about 90% of his work initially was as a driver for “Titchfield” with his own business taking up only about 10% of his time.

Titchfield Limited held several operators’ licences including the North West licence of OC1112757 with an operating centre at Newfield House in Morecambe (premises owned by Mr Goulding’s father). Nigel Brunt was its sole director. Titchfield Limited entered liquidation in 2015 and its operators’ licence was revoked on 21 January 2016.

JLS first applied for its operating licence in March 2016. Mr Goulding was asked at the time to explain if he had any links to Titchfield Limited as he was nominating the same operating centre and also specified a vehicle (NX09 DXG) which had previously been on the revoked licence. Mr Goulding explained he had worked as a sub-contractor for Titchfield but there were no other links. On that basis, the licence was granted to JLS in May 2016.

Mr Goulding sought to expand on that explanation in his evidence to the public inquiry. He stated that prior to 2016 he had worked for Titchfield as an employed driver together with another driver, [REDACTED].

When Titchfield Limited’s licence was revoked, Mr Goulding and [REDACTED] faced unemployment. Mr Goulding said he then approached Mr Brunt proposing that he continued to be given work installing advertising provided he obtained his own operator’s licence.

Mr Goulding conceded that between 90% and 95% of the work JLS did was for Mr Brunt’s companies and he claimed this was on a sub-contracting basis. The remaining work was for other customers of JLS.

After the licence was issued to JLS in May 2016, a second vehicle (T500 JAY) was added which had also previously been on the Titchfield Limited licence.

Mr Goulding said he had negotiated the acquisition of those vehicles directly with “Titchfield”. I asked him to explain why such negotiations had not been with the liquidators of Titchfield Limited. Mr Goulding appeared unsure but then suggested that the vehicles had in fact been owned by Nigel Brunt Properties Limited and hired to Titchfield Limited. When I pointed out that Nigel Brunt Properties Limited had not been incorporated until 1 March 2016 (after Titchfield Limited’s licence was revoked) Mr Goulding could not explain further.

As part of the document bundle provided, I was supplied with copies of the V5 registration documents for both vehicles. I note that JLS had been registered as the keeper as recently as July 2020.

I asked Mr Goulding who was the registered keeper between March 2016 and July 2020, and he replied it was Titchfield Media Limited (another company with Nigel Brunt as its sole director) or possibly Nigel Brunt Properties Limited. He said it was a pure oversight that he had not registered his own company as the keeper until last year when advised to do so by Mr Iddon.

During the DVSA investigation it also became apparent that the contract with JLS’ specified maintenance provider was in the name of Titchfield Media Limited. Mr Goulding was asked to explain this and he said that the provider had carried this over from the previous licence. I pointed out that the previous licence was held by a different company, Titchfield Limited. Titchfield Media Limited has never held an operating licence. Mr Goulding was not able to provide a further explanation why the maintenance contract for JLS’ vehicles was for Titchfield Media Limited. That matter has also recently been corrected.

On 23 January 2020, Mr Goulding was interviewed under caution by TE Rea about the use of the vehicle without a MoT and driver hour infringements identified during the investigation for both Mr Goulding and [REDACTED] (who was the driver of NX09 DXG on 12 November 2019 when it was encountered without a MoT). Mr Goulding initially said [REDACTED] was an employee of JLS. But when asked if the company paid his wages, tax and national insurance, Mr Goulding replied, “no not directly. I pay some of his wages”.

[REDACTED] was later interviewed himself by TE Rea. He initially said he was employed by J Goulding and confirmed by that he meant JLS. However when asked who paid his wages, [REDACTED] said it was Titchfield Media Ltd and he drove under their instruction.

The bank statements for JLS for the period between 7 September 2020 and 7 December 2020 did not record any payment of wages to [REDACTED] during that period. The weekly record sheets supplied in advance of the hearing confirmed that during that period [REDACTED] worked full time on a Monday to Friday until he was recorded as [REDACTED]from 7 December 2020.

I asked Mr Goulding to explain these matters. He initially claimed that [REDACTED] and then claimed he was paying him in cash. Mr Goulding said that practice had now stopped but went on to admit he was yet to pay [REDACTED] by any other means. He also claimed that [REDACTED] worked for both JLS and Titchfield Media Limited. This would involve him driving JLS’s vehicles to work sites and then working for Titchfield Media Limited on the actual installation aspect.

As further evidence of links it was noted during the DVSA investigation that Mr Goulding’s e-mail address was @titchfieldgroup.com. Titchfield Group Limited is another company controlled by Nigel Brunt. It was also revealed during the DVSA investigation that Nigel Brunt had driven JLS’ vehicles on occasions during 2019.

The documentation supplied by the operator in advance of the hearing contained a printout of a drivers’ hours infringement report produced by Tacho Master (in fairness showing nil infringements). The operator’s name recorded on the printout was Nigel Brunt Properties Limited. I asked Mr Goulding if he could explain that issue. Mr Goulding again initially sought to claim this was a continuation of arrangements that existed under the former Titchfield Limited licence. When I reminded him that Nigel Brunt Properties Limited had only been incorporated after that licence was revoked, Mr Goulding claimed the Tacho Master account was in that company’s name as they were paying for the service initially on behalf of JLS.

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Mr Goulding also confirmed that one of the vehicles was sign written with Titchfield Group’s name. None of the vehicles bore JLS’ name.

Mr Goulding said he understood how this state of affairs could be perceived and he had now taken steps to cease receiving financial assistance from Mr Brunt.

Mr Iddon in his evidence stressed that he had only discussed licence matters with Mr Goulding and was not aware of any other person exercising control over the licence. He had met Mr Brunt but only in his capacity as the customer commissioning work from JLS.

I also note that the former Transport Manager, Mr Harris, in his written submission did not mention any dealings with any person other than Mr Goulding in relation to the licence.

In closing submissions, Mr Ahmed argued that Mr Goulding had been naive as regards the relationship of JLS and him with Mr Brunt and his companies. He had not taken steps to distance his operation from Mr Brunt although the “Titchfield” group of companies remained his main source of work.

2.2 Maintenance & Drivers Hours

It was accepted by the operator that it has used vehicle NX09 DXG for nearly 9 months after its MoT expired until it was stopped by the DVSA on 12 November 2019.

Mr Goulding sought to place responsibility for this failure of compliance on the maintenance provider and then the Transport Manager, David Harris. Mr Goulding stated that the maintenance provider’s software usually generated a reminder that a MoT was due, but this did not happen on this occasion. He also highlighted that during the 9-month period, the vehicle had been the subject of three preventative maintenance inspections.

Mr Goulding also complained that Mr Harris had failed to notify him the MoT was due. Mr Harris did not expressly comment on the MoT issue in his written submissions, but he did claim that it was Mr Goulding who was responsible for arranging maintenance and inspections for the vehicles.

Mr Goulding accepted that he was the person who booked the vehicles in for inspections and maintenance when required and could not explain clearly why he had not also spotted that the MoT was seriously overdue. Mr Goulding appeared very reluctant to accept any responsibility himself for the issue. Referring to the Transport Manager and maintenance provider in his DVSA interview, he stated “this is why I pay these people”.

In evidence at the hearing, Mr Goulding accepted he had taken his eye off the ball and apologised for the oversight. However he was unable to provide a clear explanation why he had not taken any action against Mr Harris or the maintenance provider after the DVSA encounter on 12 November 2019. He claimed he would have terminated his arrangement with Mr Harris, but Mr Harris resigned first. I note that was several months after the DVSA encounter.

I noted that when encountered by the DVSA on 12 November 2019 there were no defects recorded and the vehicle was allowed to continue its journey. It passed the MoT test at the first opportunity thereafter.

Traffic Examiner Rea’s inspection report gave a mixed picture as confirmed in his oral evidence. He found examples of high levels of good practice (relating to matters such as driver training) but also significant shortcomings in other areas such as management of working time, analysis of tachograph records and addressing driver infringements. TE Rea said he could attribute the good practice he saw to Mr Goulding. However he considered the shortcomings identified to be attributable to a significant failure by the Transport Manager. Although there was some evidence that elements of the Transport Manager role were being performed it was far from adequate.

Mr Harris sent TE Rea an email on 27 January 2020 stating he had recently attended a CPC refresher course and was now more aware of the responsibilities and duties of a Transport Manager. He added that he found it “slightly overwhelming and too much headache for the financial reward” and intended stepping down at the end of February 2020.

It is noted that the drivers’ hours infringements noted against Mr Goulding and Mr Bajgar as drivers led to the suspension of their vocational entitlements in 2020.

The maintenance investigation visit report also gave a similar mixed picture. There were some areas assessed as satisfactory, but others were unsatisfactory. These included ineffective control by the Transport Manager, some stretched maintenance inspection intervals and prohibitions issued for driver related defects. VE Hirons found that it was clear that responsibility for maintenance service and inspections had been left by the Transport Manager to the provider. The Transport Manager had not made adequate audit checks to ensure that vehicles had been serviced, inspected, or annually tested.

VE Sefton in oral evidence confirmed that there had been no prohibitions issued since November 2019. The operator’s annual MoT failure rate was slightly above the national average, but this was not considered exceptional given the small size of the fleet.

Mr Harris sent a response to VE Hirons on 7 April 2020 asking for more time to comment on the report as he away driving on European haulage. Mr Harris also “clarified” that he had resigned as JLS’ Transport Manger in January 2020 and finished the role at the end of February 2020. He went on to say he stayed on the licence in “name only” until the end of April 2020. Neither Mr Harris nor the operator informed my office of this change at the time. Mr Harris did subsequently send an email to the Central Licensing Office on 7 May 2020 asking to be removed from the licence and saying he had resigned on 29 February 2020.

In his written submission to the public inquiry, Mr Harris said that on his appointment as Transport Manager (in 2018) he had set about introducing the required systems and checks but the arrangement of maintenance and inspection was undertaken by Mr Goulding. Mr Harris said he would ask Mr Goulding regularly if everything had been done and he accepted his affirmative response. Mr Harris said he accepted now he should have checked for himself.

Mr Goulding said he felt poorly served by Mr Harris. He had paid him his fees 6 months in advance and did not feel that Mr Harris had delivered on his commitments. He said Mr Harris used to spend a couple of hours at his office every Friday initially but seemed to want to be out of the door as soon as possible and even this tailed off. Mr Goulding accepted that Mr Harris had not delivered the 8 hours every Friday that was indicated on his application for appointment as Transport Manager.

He was far more reassured by the support he had received from Mr Iddon since his appointment as de facto Transport Manager in May 2020.

Mr Iddon gave evidence that he had introduced several new measures since his appointment. He said he found Mr Goulding to be very honest in his approach but described him as being like a “rabbit in the headlights” when he first explained to him the shortcomings on the licence. He was confident that the operator would achieve full compliance in future with his assistance.

I did point out to Mr Iddon that there had been further instances of stretched inspection intervals since his appointment with both vehicles subject to a 10-to-11-week interval between inspection sin August and November 20220. Mr Iddon said that for some of this time the vehicles were off road awaiting repair by the maintenance provider. He also said it was an oversight which would not be repeated.

Mr Ahmed in closing submissions argued that there had been a severe amount of naivety on the part of Mr Goulding but that there had been no fabrication or pre-meditated attempts to deceive. Mr Goulding was very sorry and was now trying to draw a line under the events of the past. Mr Ahmed also submitted that Mr Goulding was now more aware of his responsibilities as director of the operator and could be trusted to achieve compliance with the support of a competent Transport Manger in Mr Iddon.

The operator accepted that some regulatory action was inevitable but asked that this be short of revocation.

3. Consideration

In relation to the compliance aspects of the licence including the use of a vehicle without MoT, Mr Goulding, and Mr Harris each appear to blame each other for the shortcomings. However analysis of their evidence leads to the conclusion that the fundamental factual position is agreed by both persons.

On his own admission, Mr Harris was Transport Manager in name only between the end of February 2020 and his formal notification of his departure on 7 May 2020. The fact that he states that so openly is in itself a worrying sign of his lack of awareness of the expectations of a competent Transport Manager.

I am also satisfied that the “in name only” description could be applied to Mr Harris’ involvement in the licence for a much longer period. Both Mr Goulding and Mr Harris agree that it was the former who was responsible for arranging maintenance and service of the vehicles and I can find very little evidence of continuous and effective management by Mr Harris.

Mr Harris’s reasons for not attending the hearing and his responses to the DVSA examiners are telling. It is clear that he has a demanding full-time job as a driver with another operator and that he lacks the understanding and time to properly deliver continuous and effective management as a Transport Manager.

Mr Goulding as sole director of the operator must also take responsibility for this. It is clear he was dissatisfied with Mr Harris’ performance for some time, yet he took no action to ensure the operator had the benefit of an effective Transport Manager; not even after the significant event of the vehicle being stopped without a MoT certificate.

Whilst the compliance aspects are a significant concern, the issue which causes me the greatest concern in considering this licence is the relationship with another entity.

I do not accept Mr Goulding’s evidence that the [REDACTED]. It is utterly implausible that Mr Goulding did not supply evidence to the inquiry of invoices or other such records of sauch substantial work. By contrast the invoices he did choose to produce do not give any credence to the argument that JLS is a viable independent business and in any event, none of those involved could actually be linked to any clear evidence of payment.

I also find it implausible that the payments from companies associated with Mr Brunt to JLS were in some way financial support to Mr Goulding at a time of personal need from his brother-in-law. These were not individual to individual payments. They were payments from one company to another corporate entity which were then used to meet specific business expenses including those relating to the operation of vehicles such as insurance.

I make the following findings of fact based on the evidence including Mr Goulding’s own account and the documentation supplied by JLS:

• JLS applied for the licence in 2016 so that goods vehicles could continue to be operated for the business purposes of companies associated with Nigel Brunt;

• Titchfield Media Limited is the employer of [REDACTED] and pays his ages, tax, and national insurance contributions despite him purporting to drive for JLS;

• The recorded keeper of the two vehicles registered under the licence from its issue in 2016 remained a company controlled by Nigel Brunt until July 2020 (after the operator came under DVSA and Traffic Commissioner scrutiny);

• Until recently the contract with the maintenance provider was in the name of Titchfield Media Limited;

• Nigel Brunt Properties Limited have been paying for the fuel for the vehicles and their insurance;

• Nigel Brunt Properties Limited commissioned Tacho Master to undertake tachometer analysis of the vehicles purportedly operated by JLS;

• JLS sole source of evidenced income recently has been payments from companies associated with Nigel Brunt.

I am satisfied on the balance of probabilities that the holding of the licence by JLS has been a device from the very outset to allow Nigel Brunt’s businesses to continue to operate goods vehicles after the revocation of the Titchfield Limited licence.

I have not seen any direct evidence that Nigel Brunt has given direction to Mr Goulding on operating the JLS vehicles. I also have considered that neither Transport Manager referred to anyone other than Mr Goulding giving them instruction or dealing with the operation of the licence.

However the unavoidable inference from the degree of financial involvement that Nigel Brunt’s companies have in the operation of the JLS licence is that it is Mr Brunt and his companies and not Mr Goulding which truly controls the licence.

I do not have any confidence that this relationship has been severed. Whilst some changes have been made recently (since the DVSA investigation and Traffic Commissioner involvement) I am not satisfied that these are intended to truly sever the links between JLS and Nigel Brunt’s businesses. Rather, I consider it is more likely that these steps are an attempt to obscure evidence of those continuing links. This is exemplified by the position in relation to the insurance of the vehicles. Although the policy was amended in September 2020 so that the policyholder was shown as JLS, Nigel Brunt Properties Limited continued to fund the full payment of the premiums thereafter.

I determine that JLS holds the licence as a front for Nigel Brunt Properties Limited and/or associated companies and that is intended to avoid the challenges that the latter company would face in obtaining its own licence given the history of insolvency of Titchfield Limited which had the same director in Nigel Brunt, and the revocation of its operator’s licence.

4. Decision

I am satisfied on the balance of probabilities that the operator breached the conditions on its licence by failing to notify of events affecting professional competence, namely that David Harris was not undertaking his required duties as Transport Manager and that he had resigned with practical effect from 28 February 2020. This satisfies the grounds for revocation in Section 26(1)(b) of the Act.

Three prohibition notices have been issued to the operator in relation to its vehicles over the past five years. This satisfies the grounds for revocation in Section 26(1)(c) (iii) of the Act.

The operator has not fulfilled the statements made when applying for the licence in relation to the inspection of vehicles every 8 weeks. This satisfies the grounds for revocation in Section 26(1)(e) of the Act.

The operator has not honoured the undertakings it signed up to when it applied for its licence namely to keep its vehicles fit and serviceable and to observe the rules on drivers’ hours and tachographs and keep proper records. This satisfies the grounds for revocation in Section 26(1)(f) of the Act.

I am also satisfied that JLS Outdoor Media Limited and James Goulding as its sole director are no longer of good repute as required by the Act. This satisfies the grounds for mandatory revocation in Section 27(1)(a) of the Act. This is because of the findings I have made about its approach to compliance, the failure to ensure its previous Transport Manager exercise effective management and, most significantly, the findings I have made in relation to fronting.

I have considered the guidance in the Senior Traffic Commissioner’s Statutory Document Number 1 and note the following excerpt which I consider is relevant on the facts of this case,

“’Fronting’ is aggravated and very much more serious where it is apparent that the entity hiding behind the legitimate ‘front’ would be unlikely to obtain or would be debarred from holding their own operator’s licence.”

I have also considered the Upper Tribunal’s guidance in Utopia Traction Ltd 2011/034 and Silvertree Transport Ltd 2012/071. Those two decisions set out a further definition of “fronting” as something which occurs when appearances suggest that vehicles are being operated by the holder of an operator’s licence when the reality is that they are being operated by an entity, which does not hold an operator’s licence and the manner in which the vehicles are being operated requires, if the operation is to be lawful, that the real operator holds an operator’s licence.

I have noted that the facts in the Utopia case bear a number of striking similarities to the facts I have found in this case and one comment in the Upper Tribunal’s decision that resonates in particular reads, “In our view the fact that the Appellant never took on work from any other source is particularly telling”.

This is similar to the finding that I have made above that I found very little evidence of JLS undertaking work for anyone other than companies under the Nigel Brunt Properties or Titchfield banner and I also saw no evidence of any other source of earned income.

If I were simply considering the issue of the operator’s compliance I may well have concluded that significant regulatory action falling short of revocation such as a suspension or curtailment would be appropriate.

However the findings I have made in relation to “fronting” means that the operator and Mr Goulding’s good repute is lost, and they no longer meet the requirements to hold an operator’s licence.

For that reason I determine that the licence must be revoked. I direct that this takes effect in just over 28 days on 26 February 2021to allow an orderly winding down of operations.

I also consider it is proportionate to disqualify both JLS Outdoor Media Limited and James Goulding in person from holding or obtaining an operator’s licence for a period of one year.

5. Transport Manager David Harris

I have not found any evidence that Mr Harris was actively a party to the fronting and do not make any findings against him in that regard.

It is however clear that Mr Harris failed to meet the standards expected of a Transport Manager. There is very little evidence he exercised any effective control over the licence since his appointment and, on his own admission, he allowed his name to remain on the licence for at least two months after he considered he had resigned.

Mr Harris appears to have belatedly understood the gravity of the Transport Manager’s role after he attended a refresher course, but it is telling he regarded himself as overwhelmed. It is also clear that he was unable to properly perform his duties as Transport Manager alongside his full time European driving employment. An issue that persisted to the day of hearing when Mr Harris gave this as his reason for not attending

Mr Harris decision to attend a CPC refresher course is a positive feature to an extent as is his final decision to resign as Transport Manager. However he should have recognised that he was not undertaking the role as required much sooner and should also have informed my office much sooner of his departure.

The compliance issues with the licence during Mr Harris’s tenure and his brazen admission that he allowed himself to remain on the licence in “name only” are significant negative features which far outweigh any positives when the balancing exercise is done.

Although I have not heard from Mr Harris in person, the written submission he provided taken with his emails to the DVSA show that he lacks a true understanding of the Transport Manager role. The evidence also conclusively shows he failed to exercise effective and continuous responsibility for the licence.

I find that Mr Harris’ good repute as transport manager is lost. I disqualify him as a transport manager until 26 January 2022. The effect of this order is that Mr Harris will have the opportunity to apply to act as a transport manager after that date; it does not mean his good repute will automatically be restored on that date. I would expect any future application by him to be supported by clear evidence of the steps he has taken to further educate himself about the role of transport manager and how he will ensure he can devote sufficient time to such a role.

6. Transport Manager Richard Iddon

I do not make any adverse finding in relation to Mr Iddon’s good repute and professional competence.

The matters which have led to the revocation of the licence largely pre-dated his arrival at the operator or were matters relating to the entity that were not within his knowledge or control.

Gerallt Evans

Traffic Commissioner for the North West of England

26 January 2021