Decision

Decision for PPS Metal Recycling Ltd

Published 8 June 2022

1. WRITTEN DECISION OF THE DEPUTY TRAFFIC COMMISSIONER FOR THE NORTH EAST OF ENGLAND

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

2. PPS Metal Recycling Ltd OB2022311

3. Public Inquiry held at Leeds on 25 October 2021

4. Decision:

4.1 Background:

This business has held this Restricted Goods Vehicle Operator’s licence authorised for 3 vehicles and 3 trailers, since 11 June 2020.

The present directors are sisters-in-law, Isheen and Ramneet Oberoi. The former has already taken a step back from the business and reportedly proposes to resign her office. I was told during the hearing that it is now planned for Sahab Oberoi to be appointed as a director.

Both Ramneet Oberoi and Sahab Oberoi were present at the hearing, represented by Chris Powell, solicitor.

I note that a similar application had been made for an operator’s licence by PPS in February 2018, but it was refused because of a failure to meet the financial sufficiency requirement in November 2018.

The operator has no other regulatory history, although this application (made in September 2019) was listed for a Public Inquiry in May 2020. In the midst of the COVID pandemic, however, the application was instead granted with undertakings for the provision of an independent audit of compliance by 31 December 2020, and the attendance of both of the directors on an OLAT course. Both undertakings were met in timely manner.

The outcome of that audit report so concerned the Traffic Commissioner that he required a further undertaking for another audit by 30 June 2021. Issues were still evident when it was produced, regarding the effectiveness of driver defect reporting systems, adequacy of PMIs and the forward planning arrangements. In consequence, the third audit undertaking was agreed but is not due until June 2022.

4.2 Maintenance of fit and serviceable vehicles:

Meanwhile, a DVSA maintenance investigation by VE Aiken had begun in March 2021. Consistent with the audit findings, he had recorded an ‘unsatisfactory’ outcome. He raised particular issues with inspections carried out with the roadworthiness caption not signed off, the absence of measured and recorded brake test outcomes, stretching of maintenance frequencies beyond their (then) 12 week frequency, the absence of a VOR system, inadequate tyre check arrangements and driver detectable defects found at PMI. Of the 12 assessment areas: 8 were found to be ‘satisfactory’ or ‘mostly satisfactory’ with 3 described as ‘unsatisfactory’. An immediate prohibition was issued (during the course of the investigation) for a snapped suspension leaf. Albeit that only one vehicle has been presented for MOT test, it did pass first time.

A Preliminary Hearing had been convened on 17 August 2021, when, having heard from the operator’s transport consultant, Caleb Moore, Deputy Traffic Commissioner Harrington directed that the operator be called into Public Inquiry. Neither of the directors had attended that hearing, Ramneet Oberoi had been stranded in India as a result of the pandemic.

The DTC recorded the following matters to be considered at the Public Inquiry:

• The directors of the company have been absent from the UK for some 6 months in India managing the scrap metal operations of the company in that country and the local continent. Communication with them was spasmodic due to poor communication services in rural areas away from the major cities;

• She directed that it would be necessary to hear from them in person;

• The consultant had accepted that systems and records up to December 2020 were such that there had been a lack of effective management of the transport activities over an extended period. The directors appeared to have failed to address that issue;

• There were concerns about roles of brothers, Sahab Oberoi and Jaspreet Oberoi in the management of the company They are the husbands of the named directors;

• DTC Harrington’s review of the records produced to her raised serious concerns about how they were kept.

4.3 Unlawful use of vehicles before the licence was granted:

During his investigation in March 2021, it had become clear to VE Aiken that a company vehicle KN61 WCX had been used before the grant of the operator’s licence in June 2020. Maintence records produced to him showed that to have been the case. PPS had been the registered keeper of the vehicle since 16 February 2018.

Whilst it had not been obvious to me before the commencement of the hearing, as the hearing developed it became clear that the unlawful operation of vehicles that the VE had appeared to uncover in 2021 was not necessarily new information. In response to correspondence back in April 2020, the applicant had admitted to the unlawful use of vehicles KN61 WCX and BL57 NPY in relation to carrying out clearance work at the behest of the Environment Agency. The evidence from ANPR cameras for January to April 2020 had been available then. Nevertheless, the operator’s licence had been granted with that evidence having been taken into account. It follows, in my view, that except to the extent that the VE’s evidence and what I heard at the hearing from the director sheds new light on the likelihood of compliance, that aspect of the hearing has less significance than I had first thought.

4.4 Evidence on behalf of the operator:

The principal evidence I heard came from Ramneet Oberoi. Her testimony was full of contradiction and avoidance. I was singularly unimpressed by her significant lack of openness and transparency, she dissembled and sought to mislead when asked by me about the absence of her sister in law from the hearing and when she ceased her role, as well as the nature of the unlawful operation. She gave evidence that she believed an interim licence had been in force when this was not the case. She claimed to be making all the key decisions in the business and that her husband carried out only an “advisory” role in the way a husband might but when any question was asked about operational matters, she constantly sought to defer to him.

It was contended on her behalf that the pressure of the hearing and nervousness might explain this state of affairs. I disagree, I found her a largely disingenuous and unreliable witness. Her knowledge and understanding of the expectations of a licence holder were inadequate. The continual repetition of the explanation for the unlawful use of vehicles before the licence was granted as being justified by it being a response to the Environment Agency’s direction and that it was not carried out for hire or reward, or for the benefit of the business, (when it clearly was), being a prime example.

I heard also from her husband. He admitted that responsibility for the operator’s licence was left to him and Mr Moore (who had been involved since June 2020 but only formally taken on in October 2020). His role had much increased since his wife’s co director had left the business. Whilst his wife was reticent to accept that what the VE had found was accurate, he acknowledged it was.

Mr Moore described the systems he found when he was taken-on were outdated and “woefully inadequate”. He had increased the PMI frequency to 6-weekly, created a forward plan, arranged measured brake tests and re-energised the driver defect reporting system and made clear the operator’s expectations to the maintenance contractor. His expectation was that he would continue to provide services with personal attendance twice per month whilst systems were established.

4.5 Findings:

This is the operator’s first Public Inquiry and the concerns identified by DVSA and represented in the audit reports are not reflected in the MOT record or in prohibitions, other than that issued at the DVSA visit. There is a positive trajectory in terms of compliance, although the pace of that improvement is not what I would expect, even with the involvement of Mr Moore.

The director has sought to explain some of the system failures by reference to the failure of Richard Gabriel to fulfil his role in the business. Sadly, he was found to be suffering from the early stages of dementia that affected his attention to the detail. It was however her own evidence that he stopped taking calls and that they had not heard from him “for a very long time” that prompted the new arrangements with Mr Moore. This failure to accord to the licence the priority it deserves is concerning.

There is a history of failure to comply before the grant of the licence and the current director struggled to accept that she had done anything wrong. My analysis of the maintenance records produced for KN61 WCX showed that in the period October 2018 until September 2019, before the grant of this licence, and during which time the vehicle was not listed on any operator’s licence but kept by PPS, close to 20,000 kms was driven in it. I suspect that the extent of the unlawful operation was much greater than was envisaged at the point of its grant.

I have been required to consider the fitness of this operator to continue to hold the licence against this background. As I have set out above, the confidence and trust that I might have expected to have in the only director active in the business (Ramneet Oberoi) has been seriously undermined. I conclude that if she were to remain as a director that I would be unable to find that fitness remains. Fortunately, as it turns out, there is a proposal that Sahab is appointed as a director, but I conclude on the balance of probabilities that the fitness requirement would only be met if he replaced her, rather than that he sat alongside her. I have set out that finding in a statement of intent which I expect to take effect before the end of the year, and which will be confirmed to my office by the operator, when carried out. I acknowledge that I did not directly raise this matter (as I might have done within the confines of the hearing). If the operator is not prepared to accept such an outcome, I shall need to recall the operator to Public Inquiry and reopen the decision that I have made in expectation that it can be accepted.

I further conclude that some ‘moderate to serious’ regulatory action is justified in accordance with the Senior Traffic Commissioner’s Guidance, albeit the curtailment that I have settled on will operate only to remove what is presently the margin on the licence (there is a third vehicle, but it is off road at present). The outcome of the audit in June 2022 may provide an opportunity to determine whether the vehicle lost from the licence may then be reinstated.

I record undertakings which I expect will be freely agreed to by the business and which also give me assurance for the future.

I find that the shortcomings will have served to increase the risk to the public and that a significant and unfair competitive advantage will have have been obtained as a result of the extended period during which a vehicle was operated with no licence. The operator needs to be clear that it will be under scrutiny going forward and need to take steps to avoid any further call to a hearing.

It will be preferable, if at all possible, in the light of this decision that I receive the audit report in June 2022 and consider whether the systems in place are by then sustainable supporting compliant operation.

Simon Evans

Deputy Traffic Commissioner for the North East of England

2 November 2021.