Decision

Decision for Spencer Smith & Emily Smith (OF2020451)

Published 26 October 2020

In the Eastern Traffic area.

Confirmation of the Traffic Commissioner’s decision.

1. Background

Spencer and Emily Smith, trading as W Smith Scrap Metals, holds a Restricted Goods Vehicle Operator’s Licence authorising 4 vehicles only.

There is one Operating Centre at Hillview, Balsham Road, Linton CB21 4LD. Maintenance is declared to be taking place in-house and at 10-weekly intervals. The vehicles are as follows: R4CSG, AU05AWZ, P607 N00.

Spencer Smith previously held licence OF1003914 in the name of Walter Smith and partners, which was revoked at public inquiry in 2013. An application in the name of Spencer Smith and Wayne Smith was referred due to that revocation but was granted in January 2014 with an undertaking for roller brake testing. That licence was terminated on 31 December 2018 when the operator failed to ensure continuation. The operators managed to achieve an annual test pass rate of 63.64% after 11 tests. As a result, this licence was granted with an undertaking for a compliance audit to be lodged by 31 December 2019. ## Hearing

The Public Inquiry was listed for today, 30 September 2020, in Tribunal Room 1 of the Office of the Traffic Commissioner in Cambridge. The operator was present in the form of Spencer and Emily Smith.

The operators were directed to lodge financial evidence and maintenance records by 18 September 2020. Having heard nothing from the operators, the OTC sent an email dated 28 September 2020. It noted that documentation had yet to be lodged. It advised that evidence submitted on the day of the hearing might not be considered and allowed until 10 am the next day to supply. At 15:11 the OTC received an email from Ms Smith indicating that she had contacted an unnamed solicitor, who was now unable to represent the operator. She claimed to have tried to contact other solicitors but felt there was insufficient time to prepare. She therefore asked for the hearing to be ‘rearranged’. Having referred to the previous conduct of the operators (as set out below), the lack of explanation as to why an alternative solicitor or counsel could not attend, the failure to comply with directions and the failure to proactively communicate with the OTC, I also considered the purpose of the request and the age of the case. As the relevant Statutory Guidance records, there is a considerable public interest in hearings taking place on the date set and so hearings should not be adjourned unless there is a good and compelling reason to do so. I remained to be satisfied that the interests of justice required an adjournment.

2. Issues

The public inquiry was called at the request of the operators and for me to consider whether there were grounds for to intervene in respect of this licence and specifically by reference to the following sections of the Goods Vehicle (Licensing of Operators) Act 1995:

• 26(1)(f) – undertaking given to obtain the licence
• 26(1)(h) – material change with regards to fitness and finance
• 28 – disqualification of directors and operator to be considered

3. Findings

The undertaking offered by this operator in order to obtain the licence committed them to supplying a copy of the compliance audit within 14 days of its receipt from the operator and which was to be completed by 31 December 2019. In the absence of receipt, letters were sent on 7 January 2020 and 24 January 2020 (page 27), to which there was no response.

As a result, it was necessary to send a proposal to revoke this operator’s licence dated 20 February 2020 (page 33). The operators eventually responded on 12 March 2020 and requested a public inquiry. The response indicated a significant degree of ignorance, apparently confusing my post with that a DVSA Examiner:

The last time the traffic commissioner come to us they stated they would show us how to do an audit and we have never received any information as to how to do this. The vehicles running on this operator’s licence have not travelled on any jobs for produce within the past 12 months, we have hired haulage in.

The operators were given an extension until 4 August 2020 to give them opportunity to obtain an audit, should they wish. No such document was received.

In evidence Mr Smith’s confusion was apparent. He explained that he has issues with reading and writing. He completes the Preventative Maintenance Inspections with the assistance of his nephew. Ms Smith continued to claim that this was something that DVSA would carry out. That does not seem credible given the clear letter from OTC dated 20 February 2020 at page 33.

The operators also failed to comply with Directions to supply three months of bank statements to be averaged. Those statements submitted suggest a transfer of money from else-where, but it was not sufficient to meet the tests as outlined in Statutory Document No. 2. As the Upper Tribunal has recently remarked in 2019/076 Armthorpe Skips, whilst the requirement in section 13D is to support satisfactory facilities and arrangements for maintaining vehicles, clearly there is a need for adequate finance in order to comply with the other requirements.

On the day of the Public Inquiry I was presented with the following:

• Annual test records – refusal of AU05 AWZ on 15 August 2020, attached pass RBT check, later passed, same day.
• Preventative Maintenance Inspection forms (missing Inspection Manual items) for AU05 AWZ dated (32+ weeks) 15 February 2020, (6+ weeks) 31 December 2019, (10+ weeks) 17 October 2019, (11+ weeks) 28 July 2019 with brake performance marked as ‘Good’ or just ticked, and disclosure of driver detectable defects
• Preventative Maintenance Inspection forms (missing Inspection Manual items) for R4 ESG dated (49+ weeks) 18 October 2019, (11+ weeks) 12 July 2019, (14 weeks) 5 April 2019, the endorsements are virtually illegible, brake performance marked as ‘Good’ or just ticked, despite work to brakes e.g. 6 April 2020. Inspections on 12 July and 18 October with all reports showing as Nil, with recurring issues with the driver’s seat.
• Diary which indicates ceased recording operations in March 2020 but started again on 7 September 2020. However, tachograph charts indicate operation from 27 August, 7 September, 11 September (x2) and 15 September 2020. None of those charts appear to record any walk round check of the vehicle.

In evidence I was told that Welch’s had carried out a pre-test inspection on AU05 AWZ prior to its failure at initial presentation on 15 August 2020. There is no paperwork available. That is the only vehicle currently in operation. R4 ESG has not been operated since the last inspection around Christmas but has been taken on to the public road to try and burn some of the smoking away. No records were produced for P607 N00 as it is apparently not used.

Mr Smith gave evidence that in-house facilities include a pit for inspections. He confirmed that there is no beam tester or any form of metred brake testing. Wheels are removed during inspections but there is no recording of re-torque or even a policy. He appeared totally unaware of vehicle off-road recording and has left vehicles specified on the licence when they are no longer used. Mr Smith was unaware of the Guide to Maintaining Roadworthiness as a source for up to date standards, PMI forms and strong advice on brake performance testing. Ms Smith cannot make a similar claim as she was specifically referred to it during correspondence to obtain the licence (page 27). I was told that Ms Smith was away from work for approximately 6 months of last year.

Mr Smith is currently the only driver.

4. Determination

I have noted failures in the driver defect reporting, maintenance systems and for recording driver’s hours. Undertakings on the licence have not been complied with and Preventative Maintenance Inspection intervals have been exceeded. I have no hesitation in making adverse findings under sections 26(1)(f).

The operators failed to provide me with the requested evidence, so I record an adverse decision under section 26(1)(h) in respect of the availability of finance.

In respect of fitness, the Upper Tribunal decision in 2013/007 Redsky Wholesalers Ltd confirmed the applicability of the “Priority Freight” approach when considering the question of fitness. I therefore posed the question from 2009/225 Priority Freight: how likely is it that this operator will, in future, operate in compliance with the operator’s licensing regime? The response from the operator was deeply troubling. They gave the undertaking and should have been capable of living up to it or at least seeking advice. As the Upper Tribunal reinforced, in the appeal of 2014/024 LA & Z Leonida trading as ETS: “… it does not matter whether an operator’s licence is held by an owner operator, a partnership or a limited company because in each case the person or persons responsible for managing the business bear the ultimate responsibility for ensuring that the road transport aspect of the business operates in compliance with the regulatory regime. The Upper Tribunal was clear about the impact of a persistent failure to comply with undertakings in its decision in 2011/036 LWB Ltd, particularly where the operator was put on notice of the consequences, as occurred in this case with the proposal to revoke. That was stressed again in 2019/077 George Young Coaches: “when undertakings are given it is reasonable to expect that they be complied with. That is what the adjudication arm of the regulatory regime requires.”

The operators confirmed that there has been no additional training, no attempt to seek professional assistance, not even evidence of seeking guidance on-line through Ms Smith. They confirmed that nothing has been done since August 2020. The evidence confirms that the shortcomings have existed for much longer than that. If the undertaking for an audit by close of December 2019 had been met, they might not find themselves facing action today. The circumstances cannot be blamed on Covid-19 They have only themselves to blame. It is long established law (2006/277 Fenlon) that “Traffic Commissioners must be able to trust operators to comply with all the relevant laws, rules and regulations because it would be a physical and financial impossibility to police every aspect of the licensing system all day and every day. In addition, operators must be able to trust other operators to observe the relevant laws, rules and regulations. If trust between operators breaks down and some operators believe that others are obtaining an unfair commercial advantage by ignoring laws, rules or regulations then standards will inevitably slip and the public will suffer.”

In 2019/025 John Stuart Strachan t/a Strachan Haulage - the Upper Tribunal confirmed the relevance of deterrent action: “one of the aims of the regime is deterrence, both for the appellant and for operators as a whole, who might be tempted to flout the system”. I explored the impact of regulatory action, with only one vehicle in operation at this time but with 2 or 3 skips being loaded at the premises of their customers. However, there is nothing to indicate that the operators are fit to manage compliance and I feel compelled to make a further adverse finding against fitness under section 26(1)(h). The operators were open and accepting of their many deficiencies. This was the first Public Inquiry. What mitigation there was I took into account in not disqualifying them, safe in the knowledge that any new application will be scrutinised carefully and referred to a Traffic Commissioner. Accordingly, the revocation will take effect at 23:45 on 14 October 2020 to allow the skips to be brought back from the customers.

RT/TC/30/9/20