Decision

Decision for 247 Transit Ltd and Sica Trans Ltd

Published 9 February 2024

0.1 IN THE EASTERN TRAFFIC AREA

1. 247 TRANSIT LTD – OF2067497

1.1 AND

2. SICA TRANS LTD – OF2052368

3. CONFIRMATION OF THE TRAFFIC COMMISSIONER’S DECISION

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4. Background

247 Transit Ltd sought a Standard International Goods Vehicle Operator’s Licence authorising 2 vehicles and 2 trailers. The Director is Valentin Popa. Simon Dean Spurr was proposed as Transport Manager. Mr Popa was previously sole Director of AVF Transit Ltd (OK2061847) seeking authority to operate 4 vehicles and 4 trailers.

There was one site nominated as the Operating Centre, at Clayhill Farm, Greenfield Road, Westoning, Bedford MK45 5JD. Preventative Maintenance Inspections were to be carried out by Osborn Transport Services Ltd at 8-weekly intervals.

Sica Trans Ltd holds a Standard International Goods Vehicle Operator’s Licence authorising 2 vehicles and 2 trailers. The Director is Catalin-Marian Jinga. Sica Trans Ltd replaced the former Transport Manager, Andrew Lockey, with Simon Spurr from 22 March 2023. He was removed from the licence on 14 January 2024.

There is one Operating Centre at M1 Storage, Grovebury Road, Leighton Buzzard LU7 4UX. Preventative Maintenance Inspections were said to be carried out by Osborn Transport Services Ltd and ABF Mobile Technician at 8-weekly intervals.

Mr Spurr currently devotes four hours per week to his duties as Transport Manager for Sica Trans Ltd. He proposes to devote a further four hours per week were the application to be granted. In addition, Mr Spurr works as an employed driver for approximately 37 hours per week.

5. Hearing

The Public Inquiry was listed for today, 17 January 2024, in Tribunal Room 1 of the Office of the Traffic Commissioner in Cambridge. The operator was not present (see below). Information suggested that he might now be in Romania, but there was no request for an adjournment and the Transport Manager having been removed from the licence. The applicant was present in the form of Mr Popa, the Director. The Nominated CPC holder, Mr Spurr failed to appear. I was told that he was last seen approximately two weeks ago.

6. Issues

The Public Inquiry was called at the request of the applicant and following notice that I remained to be satisfied that the statutory criteria were met. The applicant was therefore allowed further opportunity to pursue the application and specifically by reference to the following sections of the Goods Vehicle (Licensing of Operators) Act:

• 13A(2)(b) – good repute

• 13A(2)(c) – financial standing

• 13A(3) – a Transport Manager meeting the requirements of Schedule 3

• 13C(4) – satisfactory facilities and arrangements for maintaining vehicles in a fit and serviceable condition and not prejudiced by a lack of available finance – 13D.

The Public Inquiry was called for me to also consider whether I should intervene in respect of the existing licence and specifically by reference to the following sections of the Goods Vehicle (Licensing of Operators) Act:

• 26(1)(b) – conditions on licence to notify changes, in this case relating to operation and the presence of a Transport Manager meeting the requirements of Schedule 3.

• 26(1)(e) – statement to abide by conditions on the licence.

• 26(1)(f) – undertakings (vehicles to be kept fit and serviceable, driver defect reporting, complete maintenance records, drivers’ hours and tachographs).

• 26(1)(h) – material change:

• 27(1)(a) – repute and financial standing.

• 28 – Disqualification.

The applicant and operator were directed to lodge evidence in support by 3 January 2024, including financial, maintenance and other compliance documentation. The applicant attempted to withdraw its application. Nothing was received from the operator and its Transport Manager was removed by Mr Jinga on 14 January 2024. Contact with the Office of the Traffic Commissioner confirmed that the operator was aware of this hearing. There was a suggestion that Mr Jinga might be in Romania but there was no formal application for an adjournment.     

7. Summary of Evidence

In processing the application from AVF Transit Ltd, that applicant was asked to explain large fuel payments. It was note that a payment of £2000 and a £6,000 truck rental fee had been received from the operator. It was therefore asked how it had been meeting its transport needs to date. The evidence also showed payments to Bogdan Bulgaru Ltd (reference ‘Sica Trans Ltd’) suggesting that Bogdan Bulgaru was paid for driver services.

On 2 January 2023 the applicant Director, Valentin Popa, responded on behalf of AVF Transit Ltd (page 93) suggesting that:

Sica Trans Ltd is own by my nephew and we work together. I Valentin Popa own two trucks through AVF Transit Ltd that we use on his O license therefore I receive a rental fee as part of our agreement. The sum of £6000 I received from Sica Trans Ltd was a miscalculation that’s why I had to pay back £2000. Depending on the fuel price offer I receive every week and because I had a better offer than Sica I decided to use AVFs fuel cards, that explains the large fuel payments.

Searches of the Vehicle Operator Licence system showed that vehicles BX64BYS and PO16FJN were specified on OF2052368 on 6 and 8 April 2022, respectively. Accordingly, there was no margin for an additional vehicle. A hire agreement between AVF Transit Ltd and Sica Trans Ltd (page 98-99), dated 31 January 2023 (signed on 2 February 2023) was provided under cover dated 8 February 2023. Following notification that my colleague had decided to consider that application at a Public Inquiry, Mr Popa advised that he wished to withdraw the application by AVF Transit Ltd, citing his need to improve his knowledge (page 101). He resigned as Director and was replaced by Mr Jinga.

The applicant, 247 Transit Ltd lodged its application on 25 July 2023. By letter of 15 August 2023 (page 73), the Office of the Traffic Commissioner sought additional information regarding the proposed Transport Manager, Mr Spurr, the reason for Mr Popa’s resignation as Director of AVF Transit Ltd, and the subsequent application in the name of the newly incorporated company, 247 Transit Ltd.

Mr Popa’s response at page 77 suggested that that AVF Transit Ltd had rented two vehicles, “to a friend who had an operator licence. He paid me rental payments for the vehicles only when he was able… Because of his financial position, I found myself also sometimes having to pay for the fuel in his vehicles, using my existing fuel card. I also helped him out by occasionally driving one of the vehicles for him.” He went on to state that he had decided that it would be, “simpler and better for me to no longer subsidise his business through my company and suggested that he take it over.”

As a result a request for an explanation was sent to the operator, Sica Trans Ltd, dated 30 October 2023 (page 87), requesting information regarding its interaction with to AVF Transit Ltd and Valentin Popa, the terms of the arrangement and how it was managed. The response from Mr Jinga received on 14 November 2023 (page 88) suggested: “We had a verbal agreement that we are going to split the costs and any profit the business would make! When he applied for his O Licence I found out that actually what we were doing wasn’t legal! Being advised by my previous TM Mr Lockey we tried to make like a written agreement that never materialised!”

A letter dated 30 October 2023, advised the applicant that it had failed to satisfy me that the statutory criteria were met and referred to the fitness of the Director. The response of 6 November 2023 (page 80) relied on the fact that Sica Trans Ltd had an operator’s licence, but no vehicles, and suggested that he had acquired two vehicles with the intention of applying for an operator’s licence. He stated, “There was no written agreement between us, I simply used my trucks on his license because I wanted to help him for a short period until I get my own O license without knowing or told by the TM he had at that time that it’s illegal what we were doing! The only agreement we had was verbal  that we share whatever income the business generates will be 50/50! We only tried to help each other and I never thought for a second that this is illegal !“

Mr Popa was unable to supply a satisfactory explanation for the varying versions of events whereby two of his vehicles came to be operated on an operator’s licence issued to another entity, whilst he had lodged an application. The correspondence was clear, but he purported to rely on the advice of people he described as more experienced. When pressed, he told me that it was Mr Lockey who suggested that a back-dated agreement suggesting that the vehicles had been hired to the operator might satisfy me.  He went on to suggest that Mr Spurr had advised that he claim to be subsidising the existing operator. Neither of those two CPC holders were present to give me their version of events. Mr Popa was unable to explain why it took until November 2023 to communicate what was actually happening.

8. Determination

Based on the evidence summarised above, and in the absence of evidence of financial standing and a CVPC holder, the applicant failed to satisfy me that it had met the following statutory requirements, sections; 13A(2)(b) – to have good repute, by reference to Director fitness, 13A(2)(c) – financial standing, 13A(3) – a Transport Manager meeting the requirements of Schedule 3. I did not go on to explore section 13C(4), as I was obliged to refuse the application. I used the opportunity to explain what Mr Popa would need to satisfy if he were to reapply.

The operator failed to supply documentary evidence of its compliance systems and, following the removal of its Transport Manager, I proceeded to record adverse findings under sections: 26(1)(b) – condition on the licence to notify changes relating to who was operating and the presence of a Transport Managher meeting Schedule 3, relating to Mr Lockey’s tenure, 26(1)(e) – statement to abide by conditions on the licence, 26(1)(f) – undertakings (vehicles and trailers to be kept fit and serviceable, to employ an effective written driver defect reporting system, to retain complete maintenance records for the given period, to comply with drivers’ hours and tachograph requirements. I recorded material changes under section 26(1)(h) and that the operator no longer enjoyed financial standing or a Transport Manager, following the removal of Mr Spurr – requiring action under section 27(1)(a).

I proceeded to consider the question posed by the appellate Tribunal in 2009/225 Priority Freight namely: how likely is it that this operator will, in future, operate in compliance with the operator’s licensing regime. The absence of the mandatory requirements for financial standing and a Transport Manager were clearly relevant, but I also referred to the relevant Upper Tribunal case law: 2011/034 Utopia Traction Ltd and 2016/044 Sana Aziz. As the Senior Traffic explains in his Statutory Document No. 1 on repute that ‘Fronting’, where a person, partnership or company, which does not have an operator’s licence, uses the operator’s licence held by another entity to conceal the fact that they are behaving in a way which requires them to have an operator’s licence of their own, is considered to be serious. Fronting deprives the traffic commissioner of the opportunity to oversee an ‘operator’. ‘Fronting’ is aggravated and very much more serious where it is apparent that the entity hiding behind the legitimate ‘front’ would be unlikely to obtain or would be debarred from holding their own operator’s licence. The Upper Tribunal has given clear guidance that evidence of fronting can, on its own, provide justification for deciding that the operator being used as a ‘front’ has lost its good repute. When concerns are raised that an applicant could be a ‘front’, they will need to do more than make bare assertions and rely on their good character to satisfy a traffic commissioner that there will be “clear blue water” between the applicant and the entity without an operator’s licence.

Accordingly, I found that this case fell within the SEVERE starting point for regulatory action. The conduct was such as to threaten to undermine the licensing regime and jeopardise lawful operators. On the question of disqualification, the Senior Traffic Commissioner’s Statutory Document No. 1 usefully refers to the further definition provided in the appeal case of 2012/071 Silvertree Transport Ltd: ‘fronting’ occurs when appearances suggest that a vehicle, (or fleet), is being operated by the holder of an operator’s licence when the reality is that it is being operated by an entity, (i.e. an individual, partnership or company), which does not hold an operator’s licence and the manner in which the vehicle is being operated requires, if the operation is to be lawful, that the real operator holds an operator’s licence. In which circumstances the traffic commissioner is entitled to take a serious view of such conduct. That fully justified the need for deterrent action and to disqualify. In short, the licensing regime means that I can check whether a haulier has what it takes to comply. When I give permission to operate it is only after I have checked that applicant, and it only authorises the business named on the licence.

This operator chose not to appear or to properly cooperate by providing the requested documentation. The licence is revoked under the sections of the Act listed in paragraph 19 above. It was therefore difficult to reach an informed decision on the appropriate period of disqualification even with the starting points suggested in Statutory Document No. 10. I therefore imposed an indeterminate disqualification in respect of the operator and its Director. They can apply to vary the relevant direction, but that application must be referred to a Traffic Commissioner to hear in person. The latest information suggested that operations had ceased so the order takes effect from 23:45 tonight.

8.1 R Turfitt

Traffic Commissioner

17 January 2024