Neutral Citation Number:   [2014] UKUT 0447 (AAC)
Appeal No.  T/2014/31
IN THE UPPER TRIBUNAL		
ADMINISTRATIVE APPEALS CHAMBER
TRAFFIC COMMISSIONER APPEALS

ON APPEAL from the DECISION of Kevin Rooney TRAFFIC COMMISSIONER for the North East of England
Dated 28 march 2014

Before:
His Hon. Judge Michael Brodrick,	Judge of the Upper Tribunal
Leslie Milliken,			Member of the Upper Tribunal
John Robinson,			Member of the Upper Tribunal

Appellant:
JAMES FLEMING

	 
Attendances:
For the Appellant: the Appellant did not appear and was not represented

Heard at:	Field House, 15-25 Bream’s Buildings, London, EC4A 1DZ
Date of hearing:	13 August 2014
Date of decision:	8 October 2014

DECISION OF THE UPPER TRIBUNAL
IT IS HEREBY ORDERED that this appeal be DISMISSED.

SUBJECT MATTER:-	  PSV, Restricted Licence	

CASES REFERRED TO:-	None

REASONS FOR DECISION

1.	This is an appeal from the decision of the Traffic Commissioner for the North East of England to revoke the PSV operator’s licence held by the appellant and to disqualify the Appellant from applying for or holding an operator’s licence for 12 months.
2.	The factual background to this appeal appears from the documents and the Traffic Commissioner’s decision and is as follows:-
(i)	The Appellant is the holder of a restricted PSV operator’s licence authorising the use of one vehicle having no more than 8 passenger seats.  Detailed conditions were attached to the licence.  They required the Appellant to be in a position to provide paperwork to show (a) that separate fares were paid, (b) that one of the two conditions, set out on the licence, was met and (c) that four additional requirements were met.  The Appellant was expressly warned that failure to comply would probably result in revocation of the licence and disqualification.  A number of undertakings were also given by the Appellant some of which were intended to provide evidence of compliance with the conditions attached to the licence.
(ii)	The licence was granted on 11 September 2012, following the Appellant’s request for a Public Inquiry.  In the course of this Public Inquiry the Appellant explained that the 4 seater vehicle, identified in the application, was his own personal car, which he did not intend to use for the business.  His intention was to replace it with a VW Transporter, air-conditioned and with leather reclining seats.  He also said that the nature of the work that the business would undertake would be transporting people to and from cruise liners.  He added that it would be advertised in advance through a friend who was a tour organiser.  He said that he would have a set price per seat and that every journey would be advertised on the web-site of the National Limousine and Chauffeur Association, (“NLCA”), which would enable him to have a ‘print-out’ and a copy of the advertisement to provide written proof that the relevant conditions were satisfied.  In response to further questions from the Traffic Commissioner, Mr Bowling (of the NLCA), who then represented the Appellant explained that SAGA would make all the arrangements and decide who would travel in the vehicle.  He went on to stress that the benefit of the arrangement was that the Appellant would have no limousines and no novelty vehicles.  The Appellant expressly informed the Traffic Commissioner that he was willing to accept the undertakings which were recorded on the licence.  It was on this basis that the restricted licence was granted.
(iii)	In the period following the grant of the licence six different vehicles were specified on the licence.  Of those three remained specified as at 9 January 2014.
(iv)	On 4 May 2013 the Appellant applied to vary the licence by increasing the authorisation from 1 to 2 vehicles.  Before considering this application the Traffic Commissioner requested VOSA, (now DVSA), to check whether or not the Appellant was complying with the conditions and undertakings recorded on his licence and to comment on why the Appellant had three vehicles, (at least), in possession when he only had one valid disc.
(v)	On 14 June 2013 the OTC wrote to the Appellant to give him a final opportunity to explain how he would satisfy the requirement to charge separate fares and how he would satisfy one or other of the two conditions set out on his licence.
(vi)	On 25 June 2013 the Appellant replied.  He said that in compliance with s. 265 of the Transport Act 2000: “the charging of separate fares will be ensured, reflecting a true individual fare as opposed to a total cost divided by the amount of passengers”.  He went on to explain how this would be done.  He then said that all journeys would comply with ‘excursions or tours’ or a minimum of 15 miles and that records would be kept on a secure server operated by the NLCA.  He said that advertisements would be for the journey in question and not for hire of the vehicle itself.
(vii)	On 24 October 2013 a Traffic Examiner wrote to the Office of the Traffic Commissioner, (“OTC”).  He had interviewed the Appellant and had requested a written account dealing with the concerns raised in the interview. In the course of the interview the Appellant said that he had not undertaken any limousine work since August 2013 because it was basically seasonal work.  He said that if the additional disc was granted he would employ an additional driver.  The Traffic Examiner said that he told the Appellant that the way in which he advertised for work was no different to operating under a Private Hire Licence and the fact that bookings were made ‘per head’ was purely a paper exercise because only one person made the booking.  The Traffic Examiner added that when he asked the Appellant why he had applied for a PSV operator’s licence he had replied that it was because of the ‘prestige’ of being the holder of such a licence.  The Traffic Examiner was not satisfied that the Appellant was operating in compliance with the conditions and undertakings attached to the licence.
(viii)	On 11 November 2013 the OTC wrote to the Appellant to warn him that the Traffic Commissioner was proposing to refuse the application to vary the licence because he was not satisfied (a) that the Appellant would be able to meet the conditions required to meet the requirements of s.1(1) of the Public Passenger Vehicles Act 1981, (“the 1981 Act”), or (b) the requirement to be of good repute in s. 14ZB(a) of the 1981 Act.  The Appellant was given the opportunity to request a Public Inquiry and, on 18 November 2013 he did so.
(ix)	On 29 November 2013 the Appellant was called to a Public Inquiry, (a) to consider his application to increase the number of authorised vehicles and (b) to consider whether regulatory action should be taken to revoke or suspend the licence or to vary any condition attached to the licence.  The letter set out a summary of the evidence that the Traffic Commissioner intended to consider.
(x)	On 9 January 2014 the Public Inquiry commenced before the Traffic Commissioner.  Mr Bowling of NLCA represented the Appellant.  The Traffic Examiner was not present.  The call-up letter made it clear that the Traffic Commissioner did not propose to request his attendance but that it was open to the Appellant to require his attendance.  As at the date of the Public Inquiry the Appellant had taken no steps to require his attendance but shortly after the start of the Public Inquiry it became apparent that the Appellant challenged aspects of the Traffic Examiner’s evidence.  At first Mr Bowling sought to continue in his absence but when the Traffic Commissioner pointed out the difficulties he applied for an adjournment.  The Traffic Commissioner granted the application, with understandable reluctance, saying: “I have to say that it is disappointing that you wish to question the very clear statement of the Examiner’s without having asked for him, with that being pointed out in the calling-in letter.  I would be entirely within my rights to continue and take that as evidence”.
(xi)	On 12 February 2014 the Public Inquiry resumed.  Mr Bowling again represented the Appellant and Nigel Pollard, the Traffic Examiner was also present.
(xii)	Mr Pollard gave evidence that, following the application to vary the licence, he saw the Appellant twice at Leeds Testing Station.  He agreed with the Traffic Commissioner that he had concluded that the Appellant was basically running a private hire operation.  In answer to Mr Bowling he said that he had asked the Appellant to explain how the separate fares were calculated and that he understood him to say that the total fare for the journey in question was simply divided by the number of passengers being carried on that journey.  He added that he had seen no evidence as to how bookings were made and no evidence that separate people were brought together for a journey on the same vehicle.  He accepted that one possible explanation was that the Appellant had only done a handful of jobs.  He expressed surprise at the number of vehicles being put on and taken off the licence but said that it might be because they all had different functions.
(xiii)	The Appellant gave evidence.  He accepted that he gave a number of undertakings when the licence was granted and said that to the best of his knowledge he had complied with them.  He explained that he calculated fares on the basis of a set price per seat and that he aimed for 75% occupancy.  He dealt with the various vehicles listed on the licence at one time or another.  Mr Bowling then turned to the details of the Appellant’s advertising on the internet, which the Traffic Commissioner had provided at the start of the Public Inquiry.  Mr Bowling suggested that the advertisements “do tend to read towards hire and reward work”.  The Appellant replied that he had had calls that might constitute hire and reward work and that he had passed them to people he knew who did hire and reward work.
(xiv)	The Traffic Commissioner asked the Appellant about the statement on the web-site concerning airport transfers that: “if you have booked with us and your flight is delayed and you can be sure that we will be aware and there to greet you on arrival”.  He asked how this would work if the Appellant had three different parties, on different flights, booked in the same vehicle and one party’s flight was delayed.  The Appellant replied that his terms and conditions provided for a delay of one hour and that thereafter his customers would have to seek compensation from the airline.
(xv)	The Traffic Commissioner then asked how much work the Appellant had done for SAGA.  He replied ‘none’.  Mr Bowling intervened to say that in his view SAGA had changed the way in which they sourced vehicles so that their work was now confined to two or three larger companies.  The Traffic Commissioner also asked about the vehicles specified on the licence.  He pointed out that at the original Public Inquiry the Appellant had said that he would be using a 8 seater luxury vehicle, with air-conditioning and leather reclining seats and that he was now talking of using a four-seater vehicle, for example on a journey with only two passengers.  The Traffic Commissioner added that had he known at the start that the Appellant might be using a four-seater vehicle it is unlikely that he would have granted the licence.  He went on to point out that in the course of the original Public Inquiry Mr Bowling had said that the Appellant would not be using limousines or novelty vehicles but within two months of the grant of the licence a limousine was specified on the licence.
(xvi)	The Traffic Commissioner gave a written decision dated 28 March 2014.  He began by providing a very clear explanation of the legal position in relation to the use of vehicles, with fewer than 9 passenger seats, under a PSV operator’s licence.  We believe that it will be helpful to quote it in full:
“2.  Vehicles with fewer than nine passenger seats cannot normally be considered to be public service vehicles except in very limited circumstances.  The first, under section 79 of the Public Passenger Vehicles Act 1981 allows their use by an operator of larger vehicles provided their use forms only a small part of the overall public service vehicle operation.  That exemption is not relevant here.
3.  The second opportunity to use vehicles with fewer than nine passenger seats arises from the definition of a public service vehicle in Section 1 of the Act.  This allows a vehicle with fewer than 9 passenger seats to be considered a public service vehicle if a range of conditions are met.  In short, these are that:
•	Separate fares are charged to each passenger,
•	Fares to passengers must differentiate based on distance travelled.
•	Journeys must be advertised in advance in such a way that there is a genuine opportunity for individual members of the public to travel on them, and
•	The operator, or a paid intermediary, must either bring the passengers together or make the arrangements for the payment of separate fares.
4.  This is set out clearly in VOSA’s Guide for Operators of Stretched Limousines.  That document states “Limousine operations using vehicles adapted to carry fewer than 9 passengers are likely to fall outside the PSV operator licensing regime and require a PHV licence, as they are unlikely to meet these conditions”.  More recent guidance to prospective operators of small limousines on the GOV.UK website goes further and states “For small limousines – seating up to 8 passengers - you’ll need a private hire vehicle (PHV) operator licence”.”
(xvii)	The Traffic Commissioner went on to explain that he could see no way in which the Appellant would have been able to operate in accordance with those requirements using the four-seater vehicle specified in his original application, hence the importance of the statements made by the Appellant in the course of the original Public Inquiry, (see paragraph 2(ii) above).  He made it clear that it was on the basis of these statements that he concluded that the requirements for operating under a PSV operator’s licence were met.  He then summarised the matters leading up to the Public Inquiry and the evidence given at the Public Inquiry.
(xviii)	The Traffic Commissioner concluded that in the absence of the promised work from SAGA the Appellant had operated through a website which advertised a conventional private hire operation.  He went on: “It is absolutely clear that the statements of expectation were not fulfilled.  The existence of the website means that I also find that the statements of fact on which my decision relied were false and deliberately so.  I place significant weight on this finding”.  The Traffic Commissioner went on to find that the conditions attached to the licence had been contravened and that there had been a material change in circumstances.
(xix)	Turning to the question of the Appellant’s repute the Traffic Commissioner explained that there were good reasons for the differences between operating Public Service Vehicles on the one hand and Private Hire Vehicles on the other.  He pointed out that criminal records checks are required for those holding Private Hire licences whereas they are not required in the case of PSV operator’s licences.  He added that the Appellant had “said all the right things at the inquiry” but went on to say that the fact that the Appellant has gone on, so blatantly, to run a private hire operation forced him to conclude that he could not trust him to comply in the future.  He concluded that it was extraordinarily unlikely that anyone booking a luxury vehicle for an airport transfer would want to share the vehicle with others.  He found that the operation put forward by the Appellant was a sham and that it was not likely at all that the Appellant would operate compliantly in the future.  In answer to the question of whether the Appellant’s conduct was such that he ought to be put out of business he concluded that the Appellant should never have been in business under a PSV operator’s licence in the first place.
(xx)	On the basis of these findings the Traffic Commissioner revoked the Appellant’s licence and disqualified him for a period of 12 months from the date of the decision.  He justified the disqualification on the basis that when the Appellant applied for a licence he described an operation that he knew to be capable of being legal, but he never, in fact, operated on that basis or any similar basis.  In addition he concluded that the failure to require the Traffic Examiner to attend involved a deliberate attempt to discredit his evidence in order to put forward another fictitious case.  The Traffic Commissioner concluded that the Appellant required a period of reflection before seeking to re-enter the PSV industry.
(xxi)	On 2 May 2014 the Appellant filed a Notice of Appeal.  He set out three grounds of appeal, which we will consider in due course.
3.	The Appellant did not attend the hearing of the appeal, nor was he represented.  The Tribunal did not receive any explanation for his absence nor did he apply for the hearing to be adjourned.  In those circumstances we decided to hear and determine the appeal in the absence of the Appellant.  As a result of that decision we have reviewed the whole appeal file in order to consider whether the decision of the Traffic Commissioner was plainly wrong, in the sense that the process of reasoning, and the application of the relevant law, require the Tribunal to adopt a different view.
4.	The first ground of appeal is that the Traffic Commissioner did not take due account of the fact that the type of vehicle currently being operated was materially no different to the one specified on the licence.  We accept that the Traffic Commissioner was concerned about the type of vehicle specified.  For example the Appellant specified his own four-seater private car on the original application.  He explained during the first Public Inquiry that he did not intend to use this vehicle and that he would substitute a VW Transporter.  Nevertheless it emerged in the most recent Public Inquiry that the Appellant’s personal vehicle was still specified on the licence.  At the first Public Inquiry Mr Bowling assured the Traffic Commissioner that the Appellant would not be using limousines or novelty vehicles, yet within two months of the licence being granted a Lincoln Town car was specified on the licence.  In our view the Traffic Commissioner did take into account the type of vehicles being specified on the licence.
5.	It seems to us that this ground of appeal misses the point, which is that the Traffic Commissioner’s main concern was that the Appellant was unable to operate any of the vehicles specified on the licence in accordance with the conditions which had to be met if this was to be a PSV rather than a Private Hire operation.  We are quite satisfied that this concern was justified and that the findings made by the Traffic Commissioner in relation to this aspect of the case are supported by the evidence.  It follows that the first ground of appeal fails.
6.	The second ground of appeal is that the type of work anticipated at the time of the application did not materialise so alternative work had to be found.  The type of work that the Appellant described to the Traffic Commissioner during the first Public Inquiry clearly satisfied the statutory conditions for operating under a PSV licence.  If that work failed to materialise we accept that the Appellant was entitled to look for alternative work.  However that does not mean that the Appellant was entitled to look for any work that might he available.  We are quite satisfied that any alternative work that the Appellant found also had to meet the statutory conditions for operating under a PSV operator’s licence.  The Traffic Commissioner concluded that the alternative work did not meet those conditions but, instead, amounted to work that required a Private Hire licence.  In our view he was entitled to reach that conclusion and there was ample evidence to support it.  It follows that the second ground of appeal fails.
7.	The third ground of appeal is that the Traffic Commissioner took the Appellant’s website details as being in breach of the terms of the licence when they were being used to ‘test the market’.  Assuming, for the purposes of argument that this is correct it simply means that the Appellant was testing the wrong market.  He was testing a Private Hire market, in which he was not entitled to operate. Furthermore he was testing it in a way which was not compatible with operating lawfully under is PSV operator’s licence.  In our view the Traffic Commissioner was entitled to have regard to the contents of the website and he was entitled to conclude that the contents showed that the Appellant was not operating within the conditions laid down for using vehicles with less than 9 passenger seats.  In our view the website simply confirms the conclusion that this was not and was never intended to be a PSV operation complying with the stringent conditions laid down by Parliament.
8.	We have considered whether there are any other matters that could assist the Appellant.  We are satisfied that there are none.  In our view the Appellant was given a very fair hearing.  He was granted an adjournment when the Traffic Commissioner must have been sorely tempted to proceed and he was given, both orally and in writing, in the passage quoted at paragraph 2(xvi) above, a very clear statement of the legal position.  In our view the Traffic Commissioner is to be congratulated for the simplicity with which he has explained complicated legal provisions, which are not at first or even second reading easy to understand.

His Hon. Michael Brodrick, Judge of the Upper Tribunal, 
Principal Judge for Traffic Commissioner Appeals, President of the Transport Tribunal.
8 October 2014