Decision for SDL Pellets Ltd (OH2092383)
Written decision of the Traffic Commissioner for the West of England for SDL Pellets Ltd
WESTERN TRAFFIC AREA
SDL PELLETS LTD – OH2092383
WRITTEN DECISION OF THE TRAFFIC COMMISSIONER
PUBLIC INQUIRY
DECISION
The Goods Vehicles (Licensing of Operators) Act 1995
Having found that both applicant directors have adverse insolvency history and made false declarations at the start of, and during, the application process, I find that they and the applicant company are unfit to be the holders of a goods vehicle operator’s licence. The application is refused.
BACKGROUND
This is an application for a restricted goods vehicle operator’s licence authorising the use of nine vehicles and twenty trailers from an operating centre at Chipping Campden. The applicant is SDL Pellets Ltd (“Pellets”) and the directors are Samuel Launchbury and Matthew Dearn. The application was submitted on 17 June 2026.
This application arises from the insolvency of SDL Biomass Limited (“Biomass”) following unpaid tax due to HMRC and the issue of a winding-up order. The deficiency on the Statement of Affairs is £3.8 Million. £1.3 Million is owed to HMRC. Around £0.9 Million is owed to linked businesses but there is also recorded as an asset £5.9 Million of “Interco debts” with the amount estimated to be realised therefrom being “uncertain”. Whilst no further insolvencies were declared on the application, it became apparent that Mr Launchbury is involved in the following:
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SDL Sawmills Ltd, entered insolvency July 2026, with a deficiency of over £8 Million, of which £5.6 Million was owed to SDL Biomass Limited and £1.6 Million owed to Premier Forest Products Limited, the latter apparently against a security.
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SDL Esco Limited, wound-up February 2026 as a result of a Court Order upon HMRC petition.
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SDL Biomass (North) Limited, entered insolvency February 2022, significant creditors HMRC and National Westminster Bank Plc, the latter of which was, in part at least, a Government-secured bounce-back loan.
Matthew Dearn appears to be involved with:
- Marmot Recycling Limited, wound up by order of the court following HMRC petition, April 2018.
It is, therefore, unclear how the applicant came to answer in the negative to the following question on the application form:
- “Has anyone you’ve named in this application (including partners, directors and transport managers) ever been involved with a company or business that has gone (or is going into) liquidation, owing money?”
The applicant indicated positive acceptance of the following statement:
- “Confirm you are aware that you must tell the Traffic Commissioner immediately of any insolvency proceedings that occur between the submission of your application and a decision being made on the application.”
The application was submitted on 17 June 2026. Written submissions were added to the application on the morning of 18 June. These were drafted by Murray Oliver, solicitor, and explained that Biomass had been the subject of a HMRC winding-up petition. There was no mention of any other linked insolvencies. Mr Oliver chased progress with the application thirteen minutes after uploading his submission. It was chased again on 30 June. On 6 July, an Alex Sharpe messaged on behalf of the applicant to say that Biomass was to cease trading that day, so the new application was critical. On 7 July, quite improperly, Mr Oliver emailed me directly. I passed the email to the licensing team. On 8 July, Mr Oliver messaged again saying that there was now an urgent demand for interim authority.
On 9 July, the licensing team wrote to the applicant setting out issues with the application:
- Finances appeared insufficient
- The application was for a restricted licence, but a CPC had been uploaded
- The involvement of the directors with the insolvency of Biomass had not been declared
- There was no diagram of the operating centre, an essential feature as it was to transfer from Biomass
A response was received within a couple of hours addressing most matters. The response said that Biomass had not, at that point, entered insolvency. The response actually said the following:
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The relevant financial question in the application form was:
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“Has anyone you’ve named in this application (including partners, directors and Transport Managers) ever been involved with a company or business that has gone (or is going into) liquidation, owing money?”
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The answer provided at the time of the application was “No” This was the correct answer to this question.
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The Applicant has not failed to declare that anyone named in the application has been involved with a company that has gone into liquidation owing money - SDL Biomass Ltd.
It was patently clear at that point that Biomass was “going into liquidation”, Ms Sharpe having previously notified that it was ceasing to trade. Further, this opportunity to declare the four other insolvencies was not taken and another false statement made instead.
Some further exchanges took place, and the application was referred to a Deputy Traffic Commissioner on 16 July, with a response received before 8 am the following morning. The Deputy Traffic Commissioner raised a number of reasonable questions about the conduct of Biomass and whether the applicant had acquired any assets or staff thereof. These were put to the applicant and the response itself raised further questions. The Deputy Traffic Commissioner sought to cut through the ongoing, and fairly fruitless, correspondence, by calling the application to a preliminary hearing. That was originally listed in the normal course of events for 23 September 2026 and a call-up sent on 7 August. That provided for a hearing eight weeks after the Deputy Traffic Commissioner’s decision, far in advance of the standard 12-week Service Level Agreement. Mr Oliver immediately renewed a request for interim authority or an earlier hearing. That was referred to me.
Section 24(2) of the Act makes what might appear a very obvious statement “An interim licence is an operator’s licence…”. It is actually a very important one. Section 13(2) states:
“On an application for a restricted licence a traffic commissioner must consider—
- whether the requirements of sections 13B and 13C are satisfied, and
- if the commissioner thinks fit, whether the requirement of section 13D is satisfied.
Section 13(5) states:
- If the traffic commissioner determines that any of the requirements that the commissioner has taken into consideration in accordance with subsection (1) or (2) are not satisfied, the commissioner must refuse the application
Section 13B requires that I satisfy myself that the applicant is “not unfit”. It follows that, if a Traffic Commissioner has remaining doubts as to an applicant’s fitness, neither a “full” licence nor an interim licence can be granted. By good fortune, an adjournment had freed up the morning of 18 August, and the case was relisted for that day. Given the pressure applied by the applicant for an early hearing, it was disappointing that it was unable to then meet the directions for submissions and further evidence and the submissions remained silent on three of the insolvencies. Having reviewed the papers on Friday 14 August, I asked my office to write to Mr Oliver and the applicant requesting urgent submissions on those businesses. None were forthcoming, Mr Oliver preferring instead to cover them with his client in oral evidence and no supporting documentation other than that which my office could find in the public sources.
THE HEARING
Director Samuel Launchbury and Operations Manager Alex Sharpe attended for the applicant represented by Murray Oliver, solicitor. Proceedings were recorded and a transcript is available to relevant parties on request. I record here my findings and the evidence supporting them, not the entirety of the evidence. Further evidence was provided during a short adjournment. Mr Launchbury explained the background to his business operations. He explained the way in which part of the business would bid at auction for standing timber, another business would then fell that timber, it was transported to sawmills to be made into sawn timber products, and parts of the product went on to make pellets and a final part went as fuel directly. The proportion of each lot which ended up in each of those three categories was critical to the successful outcome of a particular purchase and product sales values varied. I was given much more detail in private session as it is central to the commerciality of the operation of the wider businesses.
EVIDENCE OF SAMUEL LAUNCHBURY
The first company was formed around site clearance and tree management. It then moved in to working with utilities. It ended up acquiring large amounts of waste tree material. SDL Biomass Ltd was the original company. It started to use transport to distribute material. Stanleys Biomass was formed in 2016 to procure funding to build a combined heat and power plant. It continues to operate.
An opportunity arose to buy a sawmill in south Wales from Premier Products. SDL Sawmills was set up to do that in 2023. Sawmills was probably the reason the group was in trouble now. Houndswood is an arboriculture tipping site for tree surgeons and processes timber waste residue products into a usable renewable energy product.
Jolly Pines Ltd was set up in Covid. It sells Christmas trees and then collects them back for processing. Biomass had got to as many as a hundred staff. It generated fuel which was then sold to the other group companies.
SDL Biomass would purchase standing trees from Forestry England and National Resource Wales by auction. Its staff would harvest those trees and transport to a sawmill or power station. There was risk in estimating how much of each lot would be turned into higher value sawn wood versus that which would become only fuel. There was cross-allocation of costs across the companies. That had been incorrectly apportioned. When that was corrected, it generated a large VAT liability within Biomass. He had contacted HMRC to seek a structured payment plan. HMRC didn’t agree. He had raised a £250,000 deposit to try to get on a payment plan but that was declined. He was confident that the company could have worked through a time-to-pay arrangement successfully.
The offer of £250,000 had been made on 8 June. Mr Oliver provided an email chain in support. I noted that the email referred to previous time-to-pay arrangements that had not concluded satisfactorily. Mr Launchbury told me that the company had already been in a payment plan prior to the restructure and they had maybe missed a few payments. Over the twenty-year history, the business had had four or five time to pay arrangements which had concluded satisfactorily. The business had been cyclical based on the risks and variability previously mentioned. It was the scale that had caused the issue this time round. Leading up to that point, the company had been paying £7,500 a week to show good faith.
Biomass staff were transferred to Pellets, including the drivers. This was to remove the redundancy liability and to not leave people behind in a bad position. Only four of thirty staff had been made redundant.
SDL Biomass (North) Limited, entered insolvency February 2022, significant creditors HMRC and National Westminster Bank Plc. I was told that it was set up for a specific project. The funder wanted a stand-alone business rather than to invest in a wider business. It was accepted that this was deliberate risk-management in case of a failure. Mr Launchbury told me that the business had set-up a biomass plant for Roundwood Energy. The plant had suffered a component failure in July 2021 and been shut for three months during which time the business could not sustain its ongoing costs and failed. The breakdown was evidenced by a letter from Roundwood.
My concern is that the Statement of Affairs shows just three creditors. One is Mr Dearn who was owed £3,950. HMRC is owed £56,000 and National Westminster Bank plc £47,000. There are no other trade creditors as one might expect giving rise to an obvious finding that trade creditors were preferred to the Crown. It was accepted that a proportion, not clear how much, of the NatWest debt was a government-backed Covid loan. So, Mr Launchbury’s business venture here has cost the British taxpayer towards £100,000. Mr Launchbury saw as a positive that staff and other suppliers were protected by moving them within his “group” of businesses.
SDL Esco Limited, I was told, had not traded for 5 or 6 years. It was formed in relation to a biomass facility that was installed in Chipping Camden. It purchased the equipment to build that facility. That equipment was sold as part of a refinance across into Stanleys Biomass Ltd. It was part of a complete restructure. The funder of that equipment took the funds and left Esco with the VAT liability. It was thought to be around £80,000.
Marmot Recycling Limited had been Matthew Dearn’s business before he had joined with Mr Launchbury. Mr Dearn was not present. Mr Launchbury told me he didn’t know much about it. Natthew had told him that the business had been in the anaerobic digester waste sector. Mr Dearn had been unable to recall the details of the insolvency.
I put it to Mr Launchbury that there seemed to be a habit of making sure that all creditors bar the Crown were taken care of. I was told that it had just happened that way. Mr Launchbury confirmed that the large number of businesses was a deliberate risk management strategy, though largely dictated by the funders. Transport could not be contracted out because they supplied small businesses with fuel delivered in specialist vehicles. Drivers had to be specifically trained to make deliveries in relatively small vehicles.
CLOSING SUBMISSIONS
The liquidators of Biomass had submitted a surrender. The bank statements for the applicant showed substantial income from the invoice discounting facility and supported the application made. This was not a phoenix arrangement – the applicant is an active trading company.
POST-HEARING EVIDENCE
The applicant submitted a series of letters from HMRC to SDL Biomass Limited. They tell me that, on 5 April 2023, the company entered an arrangement to repay £136,721 of unpaid VAT. On 12 May 2023, that is amended to £153,166 through the addition of £14,176 of PAYE arrears. By 25 September 2023, the amount has reduced in total to £128419. By 24 October 2025, the overall amount has grown significantly to £354,541, being £225,667 PAYE and £128,856 VAT.
FINDINGS OF FACT
Despite having been put on notice ahead of the hearing, I was told almost nothing of the circumstances giving rise to the insolvency of Marmot Recycling Limited. So, I am left with the public record which is that HMRC filed to have the company wound up on 12 February 2018 and the winding-up order was made on 19 April that year. As there was no proper insolvency process, little else is available. Mr Dearn was director from incorporation in 2015 and was the sole director by the time of the insolvency and the sole shareholder at all times. He couldn’t remember how much it owed but didn’t think it was a “large amount”. I make adverse findings that this insolvency was not declared on the application form when it was requested to be and that I was given no worthwhile information as to the circumstances surrounding the company’s demise which characterises a lack of cooperation from Mr Dearn, given that I had explicitly asked for that information ahead of the hearing. I find that Mr Dearn has adverse history in relation to paying taxes as they fall due.
Mr Launchbury has a history of insolvency. The insolvency of SDL Esco Ltd appears to have been brought about by a commercial decision to sell equipment between companies without making arrangements to pay the VAT which then fell liable. I heard detailed evidence on this point. The purchaser will have paid VAT, as I understand it. That VAT has been paid to Esco. Then Esco doesn’t have that money to pay onwards to the public purse. Even if that is not illegal, it is certainly unethical. In the case of T/2010/83 Paul Frederick Boomer t/a Carousel, the Upper Tribunal confirmed that the “Traffic Commissioner’s trust in operators’ ethical business practices was essential to effective and compliant regulation”.
The insolvency of SDL Biomass (North) Limited may well have been catalysed by a lengthy shut-down of a power plant and that shut-down was evidenced in a rather terse letter from the plant’s owner. But again, the only creditors were the Crown and a finance institution and one of those included an unspecified amount of a Covid loan, which again falls on the taxpayer. There are no trade creditors or staff at all, all those were transferred to another of Mr Launchbury’s companies. The outcome is a further cost on the taxpayer of approaching £100,000.
The latest insolvencies are far greater in magnitude. The deficiency for SDL Biomass Ltd on the Statement of Affairs is £3.8 Million. £1.3 Million is owed to HMRC. Around £0.9 Million is owed to linked businesses but there is also recorded as an asset £5.9 Million of “Interco debts” with the amount estimated to be realised being “uncertain”.
SDL Sawmills shows a deficiency of over £8 Million. £5.6 Million of this appears to be owed to Biomass, presumably the lion’s share of the £5.9 Million of “Interco debts”. There is no appreciable Crown debt.
Mr Launchbury sought to persuade me that Biomass would have come good on a time-to-pay arrangement with HMRC. Whilst there is some evidence of it having paid the mentioned £7,500 a week at the turn of this year, the overall picture is a poor one, with an arrangement having seemingly been entered in April 2023 with arrears of £136,000 growing to £354,000 by the end of 2025. That performance obviously informs the findings of the HMRC debt manager who says by email on 4 June 2026 “I have to take into account that previous time to pay arrangements did not conclude successfully and subsequent offers of payment have not materialised. Instead the company has continued to trade without making provision for payment of its VAT & PAYE/NIC liabilities thus the debt has continued to increase”. I find that Samual Launchbury treats HMRC, and so the UK taxpayer, with contempt.
Aside from Biomass, none of the other insolvencies were declared at application, nor later when the applicant, through its solicitor, responded to the licensing office as here:
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“The relevant financial question in the application form was:
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“Has anyone you’ve named in this application (including partners, directors and Transport Managers) ever been involved with a company or business that has gone (or is going into) liquidation, owing money?”
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The answer provided at the time of the application was “No” This was the correct answer to this question.
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The Applicant has not failed to declare that anyone named in the application has been involved with a company that has gone into liquidation owing money - SDL Biomass Ltd.”
That statement was entirely false, as was the original declaration at first application. The applicant has made false statements to secure a licence, and done so on not one but two separate occasions. Operator licensing is built on trust - and trust is not built on lies.
In the case of T/2010/049 Aspey Trucks Ltd, the Upper Tribunal made the distinction between the holder of an operator’s licence and an applicant:
- “In a case such as this, the Deputy Traffic Commissioner was not looking at putting someone out if business. Rather, he was deciding whether or not to give his official seal of approval to a person seeking to join an industry where those licensed to operate on a Standard National or Standard International basis must, by virtue of S.13(3), prove upon entry to it that they are of good repute. In this respect, Traffic Commissioners are the gatekeepers to the industry - and the public, other operators, and customers and competitors alike, all expect that those permitted to join the industry will not blemish or undermine its good name, or abuse the privileges that it bestows. What does “Repute” mean if it does not refer to the reasonable opinions of other properly interested right-thinking people, be they members of the public or law-abiding participants in the industry?”
The applicant told me that outsourcing transport was difficult given the specialised nature of the deliveries, yet it has successfully outsourced that transport successfully to Biomass for years. There are many specialist hauliers in the market. Indeed, I would be surprised if it were not the majority. Drivers delivering to low-cost supermarkets have to let themselves in to customer sites and unload, often alone. Tanker operations deliver fuel to petrol forecourts and airports. Pallet networks have to load, secure and unload objects of varying shapes and sizes to and from a wide variety of premises. It is all specialist, no more so than delivering pellets of wood using a blower. So, I reject any suggestion that I am putting this operation out of business – a transport business it has never had. Aspey Trucks remains relevant.
DECISION
Having found that both applicant directors have adverse insolvency history and made false declarations at the start of, and during, the application process, I find that they and the applicant company are unfit to be the holders of a goods vehicle operator’s licence. The application is refused.
Kevin Rooney
Traffic Commissioner
1 September 2026