Neutral Citation Number: [2010] UKUT 466 (AAC)

Appeal No. T/2010/025 
IN THE UPPER TRIBUNAL		
ADMINISTRATIVE APPEALS CHAMBER
TRAFFIC COMMISSIONER APPEALS

ON APPEAL from the DECISION of MILES DORRINGTON 
DEPUTY TRAFFIC COMMISSIONER for the 
South East and Metropolitan Traffic Area Dated 26 February 2010

Before:
H. H. Michael Brodrick, 	Judge of the Upper Tribunal
Patricia Steel,			Member of the Upper Tribunal
George Inch,			Member of the Upper Tribunal

Appellants:
SKIP IT (KENT) Ltd, 
SKIP IT HAULAGE Ltd and 
SKIP IT PROPERTY INVESTMENTS Ltd

	 
Attendances:
For the Appellants: Patrick Sadd of Counsel, instructed by Kingfords Solicitors

Heard at:	Victory House, 30-34 Kingsway, London
Date of hearing:	20 October 2010
Date of decision:	   22 November 2010

DECISION OF THE UPPER TRIBUNAL
IT IS HEREBY ORDERED that the appeals of Skip It Haulage Ltd and Skip It Property Investments Ltd. be DISMISSED and the revocation of their licences takes effect at 2359 on 22 December 2010, that the appeal of Skip It (Kent) Ltd. be ALLOWED and that their application for an operators licence is remitted for rehearing and that the formal findings made against Mr. Kenneth Davies and Mr. Stephen Ford be set aside.

SUBJECT MATTER:-	  Good Repute/Fitness to hold a licence – Maintenance, breach of conditions/undertakings – the Tribunal’s approach to findings made by Traffic Commissioners – whether there is a lawful basis for formal findings against individuals. 	

CASES REFERRED TO:-	Bradley Fold Travel Ltd. & Peter Wright-v-Secretary of State for Transport EWCA/Civ/2010/695

REASONS FOR DECISION

1.	This is an appeal from the decision of the Deputy Traffic Commissioner for the South East and Metropolitan Traffic Area to revoke the Restricted Goods Vehicle operator’s licence held by Skip It Property Investments Ltd, (“Property”), to revoke the Standard International Goods Vehicle operator’s licence held by Skip It Haulage Ltd., (“Haulage”), and to refuse the application for a Restricted Goods Vehicle operator’s licence made by Skip It (Kent) Ltd. (“Kent”).  In addition the Deputy Traffic Commissioner made findings in relation to two individuals, Kenneth Davies and Stephen Ford that they had forfeited their fitness to hold a licence and forfeited their good repute.
2.	The factual background to this appeal appears from the documents and the Traffic Commissioner’s decision and is as follows:-
(i)	In August 2003 Haulage was granted a standard international goods vehicle operator’s licence which authorised 3 vehicles and 3 trailers.
(ii)	In October 2003 the operator’s licence held by a company called Skip It Ltd. was revoked because of a failure to provide financial information.
(iii)	On 22 October 2004 Property, (which appears to have been the successor company to Skip It Ltd.), was granted a Standard International Operator’s licence.  As a result of a maintenance related Public Inquiry on 6 February 2006 that licence was permanently curtailed from 9 vehicles and 1 trailer to 6 vehicles and 1 trailer. 
(iv)	The Directors of Property are Kenneth Davies and Stephen Ford.  They are also Directors of haulage.  The Transport manager for Haulage is Mr. D. Ford. 
(v)	In about October 2006 Property received a formal warning.  This followed a written explanation after an unsatisfactory fleet inspection.
(vi)	Property was called to a further Public Inquiry on 25 November 2008 following an adverse report from a Traffic Examiner and an adverse report from a Vehicle Examiner.  At the conclusion of that hearing and as a result of a breach of the terms of the licence it was suspended for 5 consecutive days.  Haulage was also called to a Public Inquiry on the same day.  At the conclusion of that Public Inquiry the licence held by Haulage was curtailed from 3 vehicles to 1 for 7 consecutive days.
(vii)	In November 2008 Kent made an application for a Restricted Goods Vehicle Operator’s licence to authorise 16 vehicles and 4 trailers.  Kenneth Davies and Stephen Ford are also Directors of Kent.  On 7 January 2009 an application by Kent for an interim licence was refused.
(viii)	In December 2008 one of the drivers employed by Property appeared before the Folkestone Magistrates for failure to use a ‘driver card’ in his tachograph.  He was fined £330.
(ix)	On 5 March 2009 there was a joint maintenance investigation, unannounced, into both Property and Haulage.  The investigation was undertaken by a Vehicle Examiner, Mr. Williams, who said that both directors were very co-operative.  
(x)	On 12 March 2009 Mr. Williams saw Mr. Davies by appointment in order to inspect the maintenance records for all the vehicles seen on 5 March 2009.  Mr. Davies produced some records.
(xi)	The report by Mr. Williams was unsatisfactory.  There were two significant concerns.  First Mr. Williams considered that the inspection reports, produced to him by Mr. Davies, (who said that they had been completed by Mr. Ford), lacked credibility because they did not show any defects, nor did they show that any rectifications had been carried out and there were discrepancies between the kilometre readings on the reports and kilometre readings on documents issued by VOSA at roadside inspections.  For example on one occasion a vehicle appeared to have travelled over 5,000 kms in one day and in another case the distance was over 2,000 kms in one day. Second it appeared that in breach of a condition on the licence most PMI’s were being carried out in house although in the case of each company the licence showed that maintenance was contracted out.  On each occasion when the inspection was carried out by the maintenance contractor a number of defects were found, which is what Mr. Williams would have expected.  In addition an immediate and a delayed prohibition had been issued.  While none of the 5 vehicles seen at the fleet inspection attracted a prohibition, each was found to have defects which warranted an advisory notice.  
(xii)	Following receipt of the unsatisfactory report the Traffic Commissioner decided that Property and Haulage should be called to a disciplinary Public Inquiry and that the application made by Kent should be determined at the same Public Inquiry.  The report made by Mr. Williams was enclosed and both Property and Haulage were warned that action might be taken on a variety of grounds which were set out.  The directors were warned that, if the licence of Property or Haulage was revoked, the Traffic Commissioner would consider whether to disqualify the directors.
(xiii)	The Public Inquiry commenced on 27 May 2010 before a Deputy Traffic Commissioner.  At the start the Deputy Traffic Commissioner pointed out that the Vehicle Examiner was not present because he was unwell.  Notwithstanding the apparent willingness of Mr. Davies to accept the written evidence of the Vehicle Examiner the Deputy Traffic Commissioner clearly and forcefully pointed out the importance and significance of some of his evidence and the fact that it appeared to go to the heart of the issues of good repute and fitness to hold a licence.  In particular she explained that the report indicated that there were substantial discrepancies in the paperwork ‘which question the whole credibility of the inspection sheets’.  The Deputy Traffic Commissioner concluded that a decision made in the absence of oral evidence from the Vehicle Examiner would not necessarily be fair.  As result the Public Inquiry was adjourned.
(xiv)	On 23 October 2009 a report was received from a Traffic Examiner, Mr. Miller, which was also unsatisfactory.  Several of the drivers working for Property were found, when stopped on occasions in 2008 and 2009, not to be using driver’s cards in the their tachographs.  The directors asserted that the journeys undertaken by Property were exempt from tachograph requirements.  This was disputed on behalf of VOSA who informed the directors that tachographs should be used.  Mr. Miller and Mr. Davies discussed the matter by telephone on 24 August 2009.  On that occasion Mr. Miller told Mr. Davies that he needed to interview him and that the matter could be further discussed on that occasion.  Mr. Davies replied that he was unable to meet before 11 September 2009 because he was too busy.  He was requested to attend for interview on 24 September 2009 but did not attend because he said he did not receive the letter.  In a telephone conversation on 29 September 2009 Mr. Davies said that he was too busy to meet before 20 October 2009.  A meeting was arranged for 21 October 2009 and Mr. Miller confirmed by telephone that Mr. Davies was aware of the date, time and place of the meeting.  On that date Mr. Miller attended but Mr. Davies did not. 
(xv)	On the same day the Office of the Traffic Commissioner wrote to Property, for the attention of Mr. Davies, at two separate addresses.  The letter enclosed the report of Mr. Miller, together with an updated brief for the Traffic Commissioner.
(xvi)	The adjourned Public Inquiry commenced on 16 November 2010 before another Deputy Traffic Commissioner.  Kenneth Davies was present on behalf of all three companies and the companies were represented by Mr. Eaton, of counsel.
(xvii)	The report prepared by Mr. Williams was treated as his evidence in chief.   He was then cross-examined by Mr. Eaton.  He did not accept that the overall maintenance of the fleet was good.  He justified that statement by pointing to the fact that on most of the occasions on which vehicles were stopped at the side of the road advisory notices were issued in respect of defects, albeit there were no prohibitions.  He accepted that there was a drivers’ defect reporting system in place, that the MOT pass rate had improved and that the vehicles were subjected to a lot of heavy usage.
(xviii)	The Deputy Traffic Commissioner asked Mr. Williams about his comment in relation to the credibility of the inspection sheets.  Mr. Williams replied: “well to put it quite bluntly, sir, either I don’t think they’re being done as they ought to be done or whether they’re actually being carried out at all, sir.  The sheets that were produced, some had ticks on them indicating that everything was serviceable, and a number, which I have stated in here, were just a blank sheet of paper with a registration number and a mileage at the top, sir”.  A little later he added: “every sheet that was produced that wasn’t from a contractor, either had ticks all the way down and nothing else. Or they just had the mileage and registration at the top and nothing on them”.  The Deputy Traffic Commissioner then made it clear that he had not seen the documents in question, because they had not been seized by VOSA.
(xix)	Mr. Davies then gave evidence and Mr. Eaton immediately asked him about the maintenance records.  He set out the position as at the date of the Public Inquiry, namely that inspections were done on a four week cycle by the maintenance contractor.  Going back to the date of the Vehicle Examiner’s visit Mr. Davies said that they had employed a mechanic, who was working with Mr. Ford and they were trying to carry out inspections ‘in house’.  Mr. Davies made it clear that he had no dealings with this part of the business because Mr. Ford dealt with the vehicles on a day to day basis inspecting them morning and evening and planning the work.  He said that it was Mr. Ford who would complete the PMI sheets.  He explained the absence of any defects on the sheets by saying that if a defect was found it would either be put right ‘there and then’ or the vehicle would be sent to the maintenance contractor, the object being to ensure that vehicles were going out on the road with virtually no defects..  He agreed that this meant that they were not notifying on the inspection sheets that defects had been found and that they had misunderstood the role of PMI sheets.  But he insisted that inspections had in fact taken place.  As to the discrepancies in relation to kilometerage Mr. Davies said that having spoken to Mr. Ford the latter suspected that he had misread something and recorded the figures incorrectly.    Mr. Davies accepted that they had not notified VOSA about the change in maintenance arrangements, adding that they did not know they had to do so.
(xx)	In answer to the Deputy Traffic Commissioner Mr. Davies accepted that if the Vehicle Examiner had not pointed out the absence of defects on the PMI sheets and the discrepancies over the kilometerage it is possible that they would have carried on in the same way as before.  The Deputy Traffic Commissioner made the point that Mr. D. Ford did not inspire him with much confidence in his ability to provide the continuous and effective responsibility required of a Transport Manager.  At this stage Mr. Eaton indicated that the ‘company’ were proposing an independent audit by the Freight Transport Association but Mr. Davies had to accept that they had not, at that stage, done anything about putting any such audit in place.
(xxi)	At the end of the evidence given by Mr. Davies Mr. Eaton asked the Vehicle Examiner whether, in the light of the progress that the company appeared to be making, it was possible that the PMI’s were being conducted, notwithstanding that mistakes were being made.  In reply Mr. Williams referred to the roadside check of a vehicle on 26 April 2008 and his inspection of the maintenance record for the same vehicle on the previous day.  At the roadside check all the body bolts were found to be loose and the most forward body mounting on the offside was broken.  Mr. Williams said that he found it hard to believe, if work had been carried out the previous day, how all the body bolts had become loose in less than 24 hours and how one bracket had broken.  When further questioned by Mr. Eaton he made the point that either the loose bolts were not seen in the course of the inspection on the previous day or the inspection did not take place.
(xxii)	It became clear during the course of the Public Inquiry on 16 November 2010 that although the report from the Traffic Examiner, Mr. Miller, had been duly served it had not been seen by Mr. Davies.  The Deputy Traffic Commissioner adjourned the Public Inquiry to 26 January 2010 to allow Mr. Davies to consider this report.
(xxiii)	When the Public Inquiry resumed Mr. Davies was again present on behalf of the companies but they were no longer represented.  He therefore spoke for them.
(xxiv)	Mr. Miller then read his report.  It would appear that, at this stage, there was some trouble with the recording equipment because the transcriber found that on many occasions his evidence was inaudible.  Mr. Davies said that at one stage they had thought that the use of logbooks rather than driver cards was acceptable.  He agreed that it had been explained that this was not the case and said that when a driver was stopped in September 2008 he had a huge argument with Mr. Ford and the driver was provided with a card by the end of the month.  A little later, in answer to the Deputy Traffic Commissioner Mr. Davies said that he accepted responsibility, as a director of the companies, and he also accepted that undertakings given on the licences had been breached.
(xxv)	The Deputy Traffic Commissioner explored the various forms of regulatory action with Mr. Davies. He said that revocation would mean that the companies would have to be wound up and that suspension would be “an incredibly difficult area for us” because the company was looking to expand.  He said that a short period of curtailment would be very difficult but would not put the company out of business, even though it was looking to expand.  When asked about disqualification Mr. Davies said that it would, basically, bring the plans for the expansion of the company to a halt, with the employees being made redundant.  Finally Mr. Davies said that Mr. Ford was not present because he had to run the business.
(xxvi)	The Deputy Traffic Commissioner reserved his decision, which was given, in writing, on 26 February 2010.  He reviewed the evidence, which we have summarised above.  He concluded in relation to Property and Haulage that in the case of each the undertaking in relation to maintenance had been breached.  He went on to conclude that “some or all of the in house PMI forms are not credible, that is to say they are false documents”.  He gave detailed reasons for reaching that conclusion and for rejecting the explanation which Mr. Davies had put forward.  He went on “therefore looking at all the evidence it is clear to me, on balance, that some or all of the in house PMI sheets presented to the Vehicle Examiner were false documents.  At the very best the in house PMI sheets failed to properly and accurately record what they should have recorded on them.  At the worst they were totally fabricated documents.  Either way they were false documents”.  He concluded that the failure to notify the change in maintenance arrangements amounted to a breach of a condition of the licences held by Property and Haulage.  The explanation that the directors “did not know” that notification was necessary was rejected.  The Deputy Traffic Commissioner concluded that there was “limited tangible evidence of improvement since the last Public Inquiry” save for the fact that the driver defect reporting system and the MOT pass rate had both improved.  
(xxvii)	In relation to the Traffic Examiner’s report the Deputy Traffic Commissioner concluded that Mr. Davies had been uncooperative and evasive in relation to the arrangements for an interview, which meant that Mr. Miller had been unable to complete his investigation.  He rejected the explanation given by Mr. Davies as to the non-receipt of letters and made the point that if it was known that there was an historical problem in relation to the receipt of post then it was the responsibility of the directors to make other arrangements to ensure that letters were received.  As a result of these findings the Deputy Traffic Commissioner concluded that the undertakings in relation to drivers hours and tachographs had been breached.
(xxviii)	In reaching a decision the Deputy Traffic Commissioner began by reminding himself that an operator remains fit to hold a licence or remains of good repute unless and until there is admissible evidence to prove the contrary.  He then went on to consider the position of each of the three companies separately.
(xxix)	Turning to Property the Deputy Traffic Commissioner pointed out that it was the third time in 5 years that the company had been called to a Public Inquiry, and that maintenance and tachographs/drivers hours had also been in issue in November 2008.  He described it as a “bad case” and went on to explain why, referring to the false PMI sheets, the failure to use drivers’ cards, despite being told that they were needed, the failure of Mr. Davies to exercise any proper management control over Mr. Ford and the uncooperative and evasive attitude of Mr. Davies in relation to the arrangements for an interview.  The Deputy Traffic Commissioner concluded that there was only limited mitigation to balance against these factors and that on the basis of all his findings it was unlikely that the operator would be compliant in the future.  He then considered whether the conduct of the company was such that it ought to be put out of business.  He concluded that he could not trust Mr. Davies or Mr. Ford to operate in accordance with the undertakings and conditions on the operator’s licence.  He went on: “in the light of all the findings that relate to this operator I have determined that the operator’s fitness to hold an operator’s licence is forfeit due to the actions, or inactions, of Stephen Ford and Kenneth Davies who, as a consequence have also forfeit their own fitness to hold an operator’s licence”.  The Deputy Traffic Commissioner revoked the licence on the basis that there had been a material change in circumstances as a result of which the company was no longer fit to hold a licence.  In addition he revoked the licence as a result of the breach of conditions and the failure to fulfil undertakings.  The revocation was ordered to take effect at 2359 on 26 March 2010.
(xxx)	In the case of Haulage the Deputy Traffic Commissioner pointed out that this was the company’s second Public Inquiry in 5 years.  He concluded that the evidence he had taken into account in relation to Property was equally applicable in the case of Haulage.  He concluded that this company was unlikely to be compliant in the future and that its conduct was such that it ought to be put out of business.  On the basis of the findings set out earlier he held that the good repute of Haulage was forfeit.  In addition he specifically found that the good repute of Stephen Ford and Kenneth Davies was also forfeit, not merely because he had found that they were unfit to hold an operator’s licence, but on the basis of the evidence as a whole.  The operator’s licence of Haulage was revoked on the ground that the company was no longer of good repute, with effect from 2359 on 26 March 2010.  It was also revoked on the same discretionary grounds which were used in the case of Property.
(xxxi)	In the case of both Property and Haulage the Deputy Traffic Commissioner found that they were of appropriate financial standing.  Since the Transport Manager had not been called to the Public Inquiry in relation to his good repute he made no determination on that issue or on the professional competence of either company.  The Deputy Traffic Commissioner briefly considered the question of disqualification but decided, just, that it was not appropriate to order disqualification against either of the directors.
(xxxii)	Finally he concluded that the formal finding that both directors had lost their good repute and had been declared unfit to hold an operator’s licence meant that Kent could not demonstrate that it met the requirements for holding a restricted operator’s licence, with the result that its application was refused.
(xxxiii)	All three companies appealed by a Notice of Appeal dated 25 March 2010.  Five grounds of appeal were advanced.  The first challenged the way in which the Deputy Traffic Commissioner reached the finding that the PMI sheets were false documents.  The second asserted that in reaching the finding that these documents were false the Deputy Traffic Commissioner failed to give any proper weight to the evidence of Mr. Davies.  The third asserted that the Deputy Traffic Commissioner had failed to give sufficient weight to the fact that drivers were keeping records, albeit not the correct records.  The fourth challenged the adequacy of the balancing exercise in relation to Property.  The fifth alleged that the call-up letter failed to alert the directors to the fact that their personal fitness to hold an operator’s licence was at risk of being forfeit.
3.	At the hearing of the appeal all three Appellants were represented by Mr. Sadd, who provided us, in advance of the hearing, with a skeleton argument for which we are grateful.  At the outset Mr. Sadd asked for permission to substitute a new ground of appeal in place of ground 5.  In essence this alleged that the Deputy Traffic Commissioner had misdirected himself in determining that the directors had forfeited their fitness to hold an operator’s licence and had forfeited their good repute, since these were findings which could only be made against the holder of an operator’s licence.  We gave permission for the substitution of this ground.
4.	By way of introduction Mr. Sadd submitted that when the issues in the earlier Public Inquiries were considered in detail it was clear that they did not justify describing this case as a ‘bad case’.  In addition he submitted that by the date of the Public Inquiry Property and Haulage were effectively compliant, even though they had not, by that stage, engaged the Freight Transport Association.  He stressed that Mr. Williams had agreed that some of the defects could have arisen spontaneously after a proper PMI check had taken place.  He pointed out that while advisory notices had been issued as a result of roadside checks there had been no prohibitions on those occasions.  He submitted that it was important to consider the other issues, which plainly troubled the Deputy Traffic Commissioner most, against this background.
5.	Mr. Sadd dealt with the first two grounds of appeal together.  He submitted that the finding that the PMI sheets were false documents, either because they were fabricated or because they did not record what they should have recorded, was such a serious finding that (a) it should have been put specifically to Mr. Davies, to answer it on behalf of the operator and (b) that the cogency of the evidence relied on should have been such that as to equate to and support the gravity of the conclusion reached.  The linked point made in the second ground of appeal was that the Deputy Traffic Commissioner failed to give any proper weight to the explanation put forward on this issue by Mr. Davies.
6.	The Tribunal has said on many occasions that an operator, (and for that matter anyone else formally called to a Public Inquiry), is entitled to know the substance of the case that has to be met.  We are quite satisfied that that requirement was complied with in the present case.  The report from Mr. Williams was served with the call-up letter so it would have been obvious from the moment that that report was read that it was being said that the PMI reports “lacked credibility”.  Indeed the report went on to explain why they were said to lack credibility.  Mr. Davies was present on 27 May when the Deputy Traffic Commissioner explored with him the extent to which this report was in dispute.  He must have heard the Deputy Traffic Commissioner say, amongst other things, that the report was calling into question whether the PMI sheets were “actually genuine documents”.  On 16 November 2009 Mr. Davies was present when Mr. Williams was asked a final question by Mr. Eaton, the answer to which is set out at paragraph 2(xviii).  There is no suggestion that the way in which Mr. Williams set out the position took Mr. Davies by surprise nor was there any request for time in which to consider how to meet this allegation.  Mr. Sadd, rightly, accepted that there was no need for the Deputy Traffic Commissioner to put the allegation to Mr. Davies in a formal way because that would not have taken the matter any further.  What the Deputy Traffic Commissioner decided to do was to ask a series of questions designed to test the credibility of the explanation given by Mr. Davies.  We are quite satisfied that this was the correct course.  It follows, in our judgment, that the allegation that the matter should have been specifically put to Mr. Davies fails.
7.	The approach which has been followed by the Tribunal, for many years, when hearing an appeal from a Traffic Commissioner, was considered by the Court of Appeal in the case of Bradley Fold Travel Ltd. & Peter Wright-v-Secretary of State for Transport EWCA/Civ/2010/695.  Giving the judgment of the Court Leveson LJ said this at paragraph 36:-
“36.	Thus, although the jurisdiction is to hear and determine matters of both fact and law, the material before the Transport Tribunal will consist only of the documents placed before the Deputy Commissioner and the transcript of the evidence; the Tribunal will not have the advantage that the Deputy Commissioner had of seeing the parties and the witnesses, hearing them give evidence and assessing their credibility both from the words spoken but also the manner in which the evidence was given.  Recognising that advantage both in relation to credibility and findings of fact, in Biogen Inc. v. Medeva Ltd [1997] RPC 1, Lord Hoffmann explained (at 45):

“The need for appellate caution in reversing the trial judge’s evaluation of the facts is based upon much more solid grounds than professional courtesy.  It is because specific findings of fact, even by the most meticulous judge, are inherently an incomplete statement of the impression which was made upon him by the primary evidence.  His expressed findings are always surrounded by a penumbra of imprecision as to emphasis, relative weight, minor qualification and nuance ... of which time and language do not permit exact expression, but which may play an important part in the judge’s overall evaluation.”

37.	The extent to which those considerations are appropriate was considered in Assicurzioni Generali SpA v. Arab Insurance Group [2002] EWCA Civ 1642, [2003] 1 WLR 577, in which Clarke LJ (as he then was) gave guidance in relation to appeals based on errors of fact in these terms:.
  
“15.  In appeals against conclusions of primary fact the approach of an appellate court will depend upon the weight to be attached to the findings of the judge and that weight will depend upon the extent to which, as the trial judge, the judge has an advantage over the appellate court; the greater that advantage the more reluctant the appellate court should be to interfere.  As I see it, that was the approach of the Court of Appeal on a ‘re-hearing’ under the Rules of the Supreme Court and should be its approach on a ‘review’ under the Civil Procedure Rules.

16.  Some conclusions of fact are, however, not conclusions of primary fact of the kind to which I have just referred.  They involve an assessment of a number of different factors which have to be weighed against each other.  This is sometimes called an evaluation of the facts and is often a matter of degree upon which different judges can legitimately differ.  Such cases may be closely analogous to the exercise of a discretion and, in my opinion, appellate courts should approach them in a similar way”.
38.	The approach to appeals in cases such as this was further considered in Subesh & ors v. Secretary of State for the Home Department [2004] EWCA Civ 56, [2004] INLR 417 in relation to the statutory regime then in force by which an appeal lay from the Adjudicator (who heard the evidence) to the Immigration Appeal Tribunal.  Para. 22 of Schedule 4 of the Immigration and Asylum Act 1999 conferred an unqualified right of appeal on any party, not limited by reference to any particular issue. 
39.	Giving the judgment of the court, Laws LJ analysed the authorities (both general and specific to asylum and immigration).  Having made the preliminary points that the IAT’s jurisdiction was not limited by Wednesbury  considerations (see [1948] 1 KB 223) and that it was “commonplace” that “an appellate court which has not heard the material oral testimony must be slow to impose its own view” (see [40] and [41]), he approached the question of what was meant by error – as opposed to mere disagreement – sufficient to justify interference with its decision.  He said, the emphasis being his (at [44]):
“The answer is, we think, ultimately to be found in the reason why (as we have put it) the appeal process is not merely a re-run second time around of the first instance trial.  It is because of the law’s acknowledgement of an important public interest, namely that of finality in litigation.  The would-be appellant does not approach the appeal court as if there had been no first decision, as if, so to speak, he and his opponent were to meet on virgin territory.  The first instance decision is taken to be correct until the contrary is shown.  As Lord Davey put it in Montgomerie [[1904] AC 73 at 82-3], “[i]n every case the appellant assumes the burden of shewing that the judgment appealed from is wrong” (our emphasis).  The burden so assumed is not the burden of proof normally carried by a claimant in first instance proceedings where there are factual disputes.   An appellant, if he is to succeed, must persuade the appeal court or tribunal not merely that a different view of the facts from that taken below is reasonable and possible, but that there are objective grounds upon which the court ought to conclude that a different view is the right one.  The divide between these positions is not caught by the supposed difference between a perceived error and a disagreement.  In either case the appeal court disagrees with the court below, and, indeed, may express itself in such terms.  The true distinction is between the case where the appeal court might prefer a different view (perhaps on marginal grounds) and one where it concludes that the process of reasoning, and the application of the relevant law, require it to adopt a different view.  The burden which an appellant assumes is to show that the case falls within this latter category.”  
40.	Thus, Laws LJ made it clear that the question was whether the appellate tribunal “concluded on objective grounds that a different view from that taken by the Adjudicator was the right one, or (and we mean it to be the same thing) whether reason and the law impelled them to take a different view” ([53]).  For my part, this reasoning applies equally and with as much force to appeals from the Commissioner to the Transport Tribunal; neither do I read the recent decisions emanating from that tribunal to which we have been referred as suggesting to the contrary.”

We would simply add that we can see not reason why the approach of the Tribunal should not be exactly the same as that of the Transport Tribunal, which was approved in this decision.
8.	In the present case the Deputy Traffic Commissioner had the advantage of seeing and hearing the witnesses and it is clear from his decision that he analysed the evidence with care.  In our judgment the advantage, which the Deputy Traffic Commissioner had over the Tribunal in the present case, was considerable.  Nevertheless we must consider whether there are objective grounds, to be found in the evidence, which require the Tribunal to adopt a different view of the facts.  We are satisfied that there are not.  In our judgment the Deputy Traffic Commissioner was fully entitled to reach the conclusions which he did.  He took care to explain how he reached those conclusions and, given his rejection of the evidence given by Mr. Davies, we are satisfied that they are sound conclusions.  There is, in our judgment, no material which begins to require us to take a different view.  In our view the Deputy Traffic Commissioner was entitled to reject the evidence of Mr. Davies and he gave cogent and compelling reasons for concluding that the PMI sheets were false.  It follows that there is nothing in the first two grounds of appeal.
9.	The third ground of appeal asserts that the Deputy Traffic Commissioner failed to give sufficient weight to the fact that the drivers had been instructed to keep records in the form of log books instead of using drivers cards in their tachographs.  Mr. Sadd realistically recognised that he faced difficulties in advancing this ground because of the number of times that drivers had been stopped and the number of times that drivers and the directors had been told that it was necessary to use drivers’ cards.  In our view the weight to be given to this particular point was a matter for the Deputy Traffic Commissioner.  We are not persuaded that the approach of the Deputy Traffic Commissioner on this point has been shown to be plainly wrong, nor can we see any material which requires us to come to a different conclusion.  In our judgment the third ground of appeal fails.
10.	The fourth ground of appeal asserts that the Deputy Traffic Commissioner failed to conduct a proper balancing exercise before concluding that Property should be put out of business.  The main complaint appears to be that the Deputy Traffic Commissioner considered the favourable factors in one brief paragraph.  In doing so Mr. Sadd submits that the Deputy Traffic Commissioner failed to take into account that Mr. Davies had been candid about failures and mistakes and had accepted ultimate responsibility and failed to take into account the continuing improvements in maintenance.  Contrary to the conclusion which the Deputy Traffic Commissioner reached Mr. Sadd submitted that the Deputy Traffic Commissioner should have concluded that Property could be properly run, with properly maintained vehicles and properly instructed drivers.  The difficulty which Mr. Sadd faces in advancing this argument is that the Deputy Traffic Commissioner took considerable care to explain why he came to the conclusion that it was not likely that Property or Haulage would be compliant in the future.  Although he did not use this expression the clear picture presented to us by the evidence and by his decision is that both Mr. Davies and Mr. Ford had a cavalier attitude to the requirements of the regulatory regime.  They showed little ability to learn lessons from past mistakes, until compelled to do so, and even then their response was, at times, too little too late, as shown by their offer to employ the Freight Transport Association without having taken any steps to do so.  In our view, given the gravity of the findings made by the Deputy Traffic Commissioner it is hardly surprising that the favourable aspect were dealt with briefly, they were simply outweighed by the unfavourable factors.  We are satisfied that the balancing exercise was not flawed and that this ground of appeal also fails.
11.	In addition to the formal decisions to revoke the licences held by Property and Haulage and to refuse the application made by Kent the Deputy Traffic Commissioner included in the matters set out on the front sheet of his written decision findings that (a) Kenneth Davies and Stephen Ford “have forfeit their fitness to hold a licence”, (one of the requirements for the grant of a Restricted Licence), and (b) that both men had “forfeit their good repute”, (one of the requirements for the grant of a Standard Licence).  In the fifth ground of appeal, which Mr. Sadd substituted with permission, he submitted that in making such formal findings, as part of the decision itself, the Deputy Traffic Commissioner exceeded his powers.  The point which Mr. Sadd sought to make was that while the Goods Vehicles (Licensing of Operators) Act 1995, ["the 1995 Act"] entitles a Traffic Commissioner to make formal findings against the holder of an operator’s licence it does not give power to make formal findings against anyone else, with the sole exceptions (a) of the power to disqualify the directors of a company or the partners in a firm, where the licence held by the company or firm has been revoked and (b) where the good repute of a Transport Manager has been put in issue in accordance with Schedule 3 of the Act.
12.	We agree with this submission.  The opening words of s.26(1) of the Act give a Traffic Commissioner the discretionary power to direct that an operator’s licence may be revoked, suspended or curtailed on any of the grounds which are then set out.  In other words action under s.26 is directed against the licence and the licence-holder not at any other individuals who may be involved but do not come into either category.  Indeed if one considers each of the provisions under which the Deputy Traffic Commissioner took action against both Property and Haulage the expressions ‘licence’ or ‘licence-holder’ or both feature in each of them but there is no reference to anyone else.  In the case of Haulage, which held a standard licence, the Deputy Traffic Commissioner made a finding of loss of good repute which then required him to revoke the licence under the mandatory provisions of s.27(1)(a) of the Act.  Once again the references in that sub-section are to ‘licence’ and ‘licence-holder’ not to the possibility of taking any formal action against anyone else.  We have considered the full extent of both s.26 and s.27 of the Act and we can find nothing in either of these sections which entitles a Traffic Commissioner to make a formal finding that a person, who is not the holder of a licence, has forfeited their fitness to hold a licence or forfeited their good repute.  We have underlined the word ‘formal’ to stress the point that the challenge to this part of the decision is to the inclusion of a formal finding rather than to the process of assessing the actions of Mr. Davies and Mr. Ford in their capacity as the directors of Property and Haulage.  Since they were the ‘directing minds’ of each of these companies it was essential that their actions were fully assessed.  Indeed paragraph 1(2)(b)(ii) of Schedule 3 to the Act specifically provides that in determining whether a company is of good repute a Traffic Commissioner shall have regard to all the material evidence, including, in particular, any other information in his possession, (apart from convictions), as to the previous conduct of “any of its directors, in whatever capacity”, if that conduct appears to him to relate to the company’s fitness to hold a licence.
13.	Traffic Commissioners are not left powerless to deal with individuals who are not themselves licence-holders but nevertheless have a close connection with a licence-holder.  The power to disqualify under s.28 of the Act is confined to cases where a Traffic Commissioner directs that the licence is revoked and the individual has been given notice that revocation will be considered.  But once the licence has been revoked the power extends to the directors of a company or the partners in a partnership whose licence has been revoked.  The Deputy Traffic Commissioner was aware of the power to disqualify but decided not to exercise it.  It may be that he felt that the formal findings which he included in the decision provided some form of compromise.  If so it was not one of which Mr. Davies or Mr. Ford were given any prior warning in the call-up letter.  Mr. Sadd made the point that having decided that both Mr. Davies and Mr. Ford had ‘forfeit their fitness to hold a licence and forfeit their good repute’ the logical conclusion should have been to order disqualification, so that the failure to disqualify casts doubt on the need for or the appropriateness of any further finding.  We have some sympathy with that view but we are satisfied that there was no lawful basis for these formal findings, with the result that they must be set aside.  Indeed were that not to be done it seems to us that if Mr. Davies or Mr. Ford or both of them were to apply, in the immediate future, for a licence in their own right or as directors or partners of a company or partnership applying for a licence the question of the status of these findings or the weight to be attached to them would inevitably arise.  At the risk of raising technicalities it might be argued that since these findings were made against Mr. Davies and Mr. Ford personally that they too ought to be parties to the appeal.  Should that be required in order to do justice in this case then our view is that any retrospective application to add them should be granted.
14.	That leaves the application by Kent, though this did not feature in the original grounds of appeal.  Following the indication that we agreed with Mr. Sadd’s submissions in relation to the formal orders against Mr. Davies and Mr. Ford, Mr. Sadd sought and was given permission to address us in relation to Kent.  The short point which he made was that the sole reason for refusing the application by Kent was the formal finding that both directors had lost their good repute.  He submitted that once that finding was set aside the stated justification for refusing the application by Kent went with it, with the result that an appeal on behalf of Kent should be allowed.
15.	We are conscious of the fact that this is a technical point rather than a decision on the merits.  We are also conscious of the fact that it might be possible, on the material available, to substitute our own decision.  In the particular circumstances of this case we do not consider this course to be appropriate.  The circumstances which we have in mind are these.  First, this is an application for a new licence rather than the revocation of an existing licence licence.  Had it been the latter the probability is that we would have taken a different view to avoid a stale case being re-heard.  Second, neither Mr. Davies nor Mr. Ford were disqualified, which means that even if we upheld the rejection of Kent’s application there would be nothing to prevent another application in due course.  In our view remitting the application by Kent for re-hearing before a different Traffic Commissioner will give the Traffic Commissioner a greater degree of control over the conduct and progress of the application than might be the case with an entirely fresh application.  Amongst the matters which the Traffic Commissioner will, no doubt, consider is whether there is any need for a fresh call-up letter.
16.	The result is that the appeals by Property and Haulage are dismissed.  The order of the Tribunal in the case of each of them will come into effect on 22 December 2010.  The formal findings in relation to Mr. Davies and Mr. Ford are set aside.  The appeal by Kent is allowed and the application is remitted for re-hearing before a different Traffic Commissioner.
17.	Finally we wish to commend the care with which both Deputy Traffic Commissioners approached the question of whether the Public Inquiry had to be adjourned.  With a date set and everyone present in one case and a partially completed hearing in the other there must have been a strong temptation to persuade everyone to carry on.  If so on each occasion the temptation was resisted.  Instead it is apparent that on each occasion the Deputy Traffic Commissioner concerned was alert to the issues in the Public Inquiry and alive to the significance of the evidence in question.  In our view the result of the careful and considered approach adopted by both Deputy Traffic Commissioners was that they took the correct decision and almost certainly saved the waste of time and money which would have resulted from the refusal of an adjournment followed by a successful appeal, and an order for the re-hearing of the Public Inquiry,

       

His Hon. Michael Brodrick, Judge of the Upper Tribunal, 
Principal Judge for Traffic Commissioner Appeals.
22 November 2010