Decision

Decision for CRA Transport Ltd (OF2034800)

Published 24 August 2023

0.1 In the Eastern Traffic Area

1. Confirmation of the Traffic Commissioner’s Decision

1.1 CRA Transport Ltd (OF2034800)

2. Background

CRA Transport Ltd holds a Standard International Goods Vehicle Operator’s Licence authorising 5 vehicles and 5 trailers. The Directors are Cleider Andrade and Marislene Rogoschin. Companies House records them as Cleider Rodrigues Andrade and Marislene Alves von Rogoschin. The current Transport Manager listed on this licence is Pauline Hayter, who was appointed from 6 September 2022. A Period of Grace was granted from 19 August 2022 to allow for that appointment. A letter from my office dated 30 March 2023 confirmed that Ms Hayer was not called to consider her CPC.

There is one Operating Centre at Unit 4, Cliffeside Industrial Estate, Askew Farm Lane, Grays RM17 5XR. Preventative Maintenance Inspections are said to be carried out by Iconic Commercials Ltd at 6-weekly intervals. The payments to a Spark Vehicle Repairs were said to be for driver services (see below).

This licence was granted from 20 August 2020. The operator then sought to add an Operating Centre at 1 Sycamore Cottages, Roxwell Road, Writtle, Chelmsford, CM1 3SA, and to increase authority to 10 vehicles and 4 trailers.

Ms Hayter also acts as the Transport Manager for 4 hours per week for The Learning Centre (TLC Romford) Ltd, which holds PK1148871, authorising 4 vehicles and for 8 hours per week Inca Trade Ltd which holds OF2038165. Authorising 6 vehicles. She apparently attended a 2-day refresher course in April 2020.

3. Hearing

The Public Inquiry was listed for today, 19 April 2023, in Tribunal Room 1 of the Office of the Traffic Commissioner in Cambridge. was present in the form of Mr Andrade, Director, accompanied by Ms Hayter, Transport Manager.

4. Issues

The public inquiry was called at the direction of the Deputy Traffic Commissioner to determine whether I should intervene in respect of this licence and specifically by reference to the following sections of the Goods Vehicle (Licensing of Operators) Act:

• 26(1)(f) – undertakings (vehicles and trailers 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 operator was also provided with further opportunity to satisfy me that the statutory criteria are met to grant its variation application and specifically by reference to the following sections:

• 13C(2) – satisfactory arrangements to comply with the law regarding drivers’ hours.

• 13C(4) – satisfactory arrangements and facilities for maintaining vehicles, including trailers, in a fit and serviceable condition.

• 13C(5) – that the proposed site is available and suitable for use as an Operating Centre.

• 13C(6) – that the site has sufficient capacity for all vehicles to be used under the licence.

• 13A(3) – the Transport Manager is able to meet the requirements of Schedule 3.

The operator was directed to lodge evidence in support by 5 April 2023, including financial, maintenance and other compliance documentation. My office received a letter dated 3 April 2023 purporting to withdraw the variation application and to change Operating Centre. This was brought to my attention on 14 April 2023. Financial evidence appeared to meet the prescribed sum.

5. Summary of Evidence

The operator lodged its application on 16 September 2022, seeking to add the site at 1 Sycamore Cottages, Roxwell Road, Writtle, Chelmsford, CM1 3SA, and to increase its authority on the licence from 5 vehicles and 2 trailers to 10 vehicles and 4 trailers.

In response to that application, the Driver and Vehicle Standards Agency commenced an investigation. The reports from the Vehicle and Traffic Examiner suggested that the operator’s compliance management was not satisfactory.

The Desk Based Assessment (pages 52 onwards) refers to areas of concern, as follows:

• Maintenance provider’s address differed to the licence record and photographs provided suggested a mobile mechanic operating from a van.
• Inspection records for GJ64GKD were incomplete with four of the six records examined not having been signed-off as roadworthy, with missing tyre manufacture dates amongst other issues.
• Inspection records for AY17TSO also had issues such as no tyre manufacture dates for tyres on steering axles recorded.
• C199936 had no brake performance checks.
• Only one of the 14 records checked showed a roller brake performance test, but only then for annual test. The request to the maintenance contractor was dated after the DVSA investigation commenced.
• Inspection records refer to torquing of wheel nuts but no written policy on wheel security.
• No evidence provided, and an unsatisfactory explanation, of tyre management arrangements. Steer axle tyre manufacture dates not always recorded at PMI.
• The inspection records refer to driver detectable defects, but which had not been reported. The Examiner noted some evidence of drivers carrying out walk round checks, with sufficient time recorded, but the operator failed to provide the requested weekly sample for each vehicle.
• Electronic ‘Vehocheck’ driver defect reporting system is in use. Defect reports are automatically emailed to a director, the then transport manager and maintenance contractor to assess the severity, however defects do not appear to be signed-off /rectified promptly, e.g.:
• GJ64GKD - defect reported 6 April 2022, signed off as repaired 20 April 2022
• GJ64GKD - defect reported 9 April 2022, signed off as repaired 28 April 2022
• GJ64GKD - defect reported 10 April 2022, signed off as repaired 28 April 2022
• GJ64GKD - defect reported 11 April 2022, signed off as repaired 28 April 2022
• AY17TSO - defect reported 21 May 2022, signed off as repaired 1 June 2022
• No evidence of training provided but the Examiner did note the gate checks.
• No evidence provided regarding vehicle emissions systems, with a suggestion that fuel and AdBlue usage is monitored.
• The Examiner was concerned by the description of load security arrangements and in particular relating to third-party trailers.
• The Examiner was told that the operator employs quarterly checks, but the operator only supplied a copy of a photocard licence and one online DVLA check and no effective system for monitoring drivers CPC. There was limited evidence of driver training.
• The operator referred to remote downloads from digital vehicle units but not how records were checked. The Examiner referred to the limited response on tachograph analysis, although noted the disciplinary procedures in place. The operator referred to journey planning but did not supply evidence or for agency drivers.
• Digital records are retained on Tachomaster (confirmed) for the required 2-year period, but no evidence of the working time opt-out was received – does it refer to 48-hour average, or the 10-hour night duty.
• The event reports supplied for July and August 2022, were only printed on 4 October 2022 and had not been annotated with explanation and were not signed by driver and Transport Manager.

The operator’s response dated 14 November 2022 provided assurances and an account of subsequent action taken which included: roller brake test at every Preventative Maintenance Inspection; defects now checked against Preventative Maintenance Inspections records; formal training for drivers in November (2022), with formal records to be kept; emissions policy in place; tyre management policy in place (examples seen at the hearing with weekly tyre check); load security training for drivers commenced, and new driver checks policy. The letter of 3 April 2023 refers to the engagement of Rafael Courto of XLog Solutions who persuaded the operator to centralise records with Fox Logistics and another unnamed operator using the Karavela system. I was referred to previous named Transport Managers: Guillaume Veira and Mr Courto. He was named on the licence between 14 July 2022 until corrected on 4 August 2022, when it was noticed that the application had been made but without the Director’s signature. Nevertheless, it was the operator’s intention to pursue that nomination. I was told that the operator is no longer working with XLog Solutions, but I noticed that the operator has continued to engage Mr Courto as a transport planner and to pay him during February and March 2023. That is concerning given the issues identified below.

There was a clear plan that Fox Logistics, Tonnes and Tonnes, and this operator would work closely together, pooling drivers, centralising maintenance, and compliance, using the authority across licences to realise work, all without reference to the Operator Licence obligations. It sought to use a system based on van operations and adapt it to larger vehicles. At no time did any of the operators notify my office of these intentions. None of them checked that the advice of Mr Courto and his brother was correct. The Karavela system was apparently only withdrawn due to disagreements with the owners including data protection issues. The operator was only given 15 days to remove its data and therefore does not have access for some records for October to December 2022.

I refer to the dip sampling of current maintenance records: GJ67 RZG

• 31 March 2023 (supplied) – inspection signed off on 18 March 2023. Ms Hayter told me that there has been a recurring problem with the contractor supplying the inspection forms with the vehicle. The operator was advised that the contractor needs to support the operator’s compliance.

• 18 March 2023 – inspection with roller brake check: 60%, 37%, 23%. It also records defective tyres and an oil leak but no driver report.

• 4 February 2023 – inspection with roller brake check: 52%, 27%, 22%.

• 4 January 2023 – inspection with no discernible brake check.

• 21 December 2022 – inspection with no discernible brake check. It also records defective windscreen and an oil leak but no driver report.

• 12 November 2022 – inspection with no discernible brake check. It records defective tyres but no driver report.

K13 GPL

• 11 March 2023 – inspection with roller brake check on 18 March 2023: 58%, 25%, 22% but an imbalance of 25%. It also records defective washer, loose wires, exhaust, and taillight, but no driver report.

• 27 January 2023 – inspection with roller brake test on 30 January 2023: 46%, 17%, 21% so retested on 2 February 2023 but: 47%, 18%, 21%, after front discs and airbag were found to be work. It also records defective side-light and marker (again), tyre but no driver report.

• 12 December 2022 – inspection with no discernible brake check despite the reference to brake pads. It also records defective sidelight, marker, step (again) and wheel with chip to the windscreen.

• 12 November 2022 – inspection with roller brake check on 26 October 2022 but: 43%, 25%, 20% and insufficient load on axle 3 and a 22% imbalance. It also records a defective step and tyres (again) but no driver report.

• 1 October 2022 – inspection with no discernible brake check. It also records defective tyres and damage to the step but no driver report.

• 2 August 2022 – inspection with no discernible brake check. It also records low tyre pressures but no driver report.

I was told that the operator relies on the Vehocheck app for drivers to report defects, which immediately notifies the operator and Transport Manager. In addition, reference was made to weekly gate-checks. That does not appear to have prevented the shortcomings identified from the maintenance records.

The tyre check policy was said to include weekly checks. 15. The photograph of the wall planner suggests that only 4 vehicles are in operation: KV68 DYC, GJ67 QZG, K13 GPL, KV68 FGA, as specified. The Driver details schedule suggests that the following work for the operator: Alves Gonclaves Fagner, Cleider Andrade, Jimmy Moreno Nova, Kleyber Rogoschin, Jefferson Carlos Alves da Silva, Antonio Agrelli, Ramerson Ferreira da Silva, but with payments made to other drivers. I noted amongst the infringement reports that there was reference to Driver Moreno Nova but that the driving was for another business. Reports appeared limited to Drivers Moreno Nova, Agrelli, and Ferreira da Silva. Ms Hayter explained that the operator has now purchased a tyre pressure gage with the intention of weekly checks. The issues with the drivers using the gage. The other Director’s partner, who is a diver, is responsible for overseeing this but has failed to implement effective checks, further illustrating the issue with driver control.

Mr Andrade stated that the operator has never operated beyond the level of authority. He referred to a stop in June 2022 when a vehicle was being operated by Fox Logistics was seen at Ashley Heath weighbridge. There are still occasional payments between the entities. It was said to be displaying a disc issued to that operator. The driver, Jimmy Moreno, mistakenly indicated that he was working for this operator. The operator suggested that it had provided statements to DVSA on two occasions but that the record had not been corrected. As the operator no longer works with XLog it has separated its drivers’ hours records and defect reports meaning that it now has its own core documents. Drivers are no longer shared or taken from a pool. Driver Moreno was described as a frequent driver for this operator. That said, the operator had never felt the need to implement disciplinary action as it simply ceased using drivers if there was a problem. All drivers now supply personal details, health and eyesight checks, and other information upon induction, but the operator confirmed that not one of them is employed. As was evident from the above evidence, it has not proved possible to exercise the required level of control.

6. Determination

Based on the evidence summarised above, I was satisfied that I should make adverse findings under the following sections of the Act: 26(1)(f) – undertakings (vehicles and trailers to be kept fit and serviceable, driver defect reporting, complete maintenance records, drivers’ hours, and tachographs). There has been a material change under section 26(1)(h) in the fitness to ensure compliance, although the relatively recent appointment of an experienced Transport Manager has resulted in some improvement. The issue is with the environment in which the Transport Manager is expected to deliver compliance and where the Director has been slow to respond.

I refer to the fact that none of the drivers are employees and therefore subject to effective discipline. In 2019/54 Bridgestep Ltd & Tom Bridge, the Upper Tribunal referred to the practice of drivers classify themselves as self-employed. The Tribunal commented that the legitimacy or otherwise of a driver’s self-employment status is fact specific and as the Factsheet produced by the RHA on self-employment contained within the bundle makes clear: “Unless they are an owner-driver, it is very rare for a lorry driver to be legally “self-employed”. There was nothing before the Tribunal to confirm that the arrangement between the company and its drivers was compliant with the HMRC guidelines. The Upper Tribunal referred to a conscious decision to enter into an arrangement with the company’s drivers which was highly questionable if not a sham. The reasons for doing so were anti-competitive being as they were, concerned solely with the cost of employing the drivers and by reducing that cost, gaining a competitive advantage over other compliant operators. The Tribunal went on to describe the vast majority of operators making the right decision to employ their drivers, paying national insurance, pension contributions, holiday, and sickness entitlement. The consequence in that case was that the company and Transport Manager felt unable to give any instruction to drivers whether it be in relation to route planning or otherwise and consequently, were unable to have continuous and effective management of the transport operation. This type of service agreement represents a potential advantage during a period where most operators have felt the impact of the driver shortage.

It emerged during the hearing that the operator no longer uses its own trailer but is engaged in third-party haulage, mainly collecting trailers brought in from Europe by LKW to ports at Purfleet, Tilbury, Harwich, Felixstowe, and Poole. The operator relied solely on the driver defect reporting, which has been shown to be deficient. The operator was accepted on to an approved list by Mr Andrade was unaware of any contractual access to trailer records. He was clearly aware of the information supplied through his work for Sainsbury’s with trailer test, inspection and brake test daters displayed. None of that information was available from his other customers so that basic requirements of the Operator Licence are not being met, with a potential impact on the safety of roads within Great Britain. The DVSA Guide to Maintaining Roadworthiness assists operators by making practical suggestions for managing that type of operation:

3.3 Traction services and third-party trailers

Ensuring third party trailer roadworthiness can be problematic for the traction service operator. Usually for short-term use the trailer owner would be responsible for the routine maintenance of the trailer, including the safety inspection (SI). Under these circumstances, traction operators are reliant on the trailer owner to correctly carry out their own safety inspections within their stated frequency and complete any necessary repairs.

The traction operator is responsible for ensuring a thorough walkaround check of the tractor/trailer combination is carried out to establish it is safe prior to use. If defects are identified during the walkaround check, these should be rectified prior to use.

Traction operators would be expected to work with the trailer owners to ensure any trailers operated fall within the owner’s agreed SI frequency and that they are roadworthy. It is best practice for the trailer owner to provide evidence for the operator that first use checks and safety inspections have been undertaken and demonstrate there are no outstanding defects reported for the trailer.

There must also be a robust system in place to ensure defects identified during the walkaround check, or develop during use, are recorded and rectified before the tractor/trailer combination is operated in an unroadworthy condition.

Transport managers are also required by law to manage the transport operation continuously and effectively. The operator’s licence requires “satisfactory facilities and arrangements for maintaining the vehicles used under the licence in a fit and serviceable condition.” In that context, “vehicles” includes any trailer (including those from abroad) being drawn. An operator providing traction-only services must have trailer authority on that licence and must specify an inspection period. The trailer provider is likely to have its own inspection periods, which should be based in part on the age and characteristics of the trailers and work involved. The operator needs to satisfy themselves that it is appropriate. The operator must ensure that any trailer it operates meets the stated frequency for inspection. If the operator cannot satisfy themselves that a suitable assessment has taken place, then the operator must make their own assessment, as per the declared intervals. An operator should therefore expect access to information which indicates the annual test expiry, the date of the last Preventative Maintenance Inspection, for trailers not fitted with electronic brake performance monitoring, date of last roller brake test and confirm that this was laden, contact details for reporting of defects. Drivers will require appropriate training in conducting an effective walk-around check including noting the trailer’s annual test expiry and confirming that it has been inspected and brake tested within the stated period. That training should be documented. Operators should refer to the current DVSA Guide to Maintaining Roadworthiness and may be further assisted by reference to the IRTE publication: Roadworthiness: Industry Best Practice for third party trailer operators, Appendix VII includes a suggested “Co-operation request letter to trailer owner.”

This is the first Public Inquiry, but it has been 76 months since the DVSA investigation and substantial matters remain to be addressed. Assurances given around brake testing and in respect of basic compliance and record keeping have yet to be realised. In 2013/082 Arnold Transport Ltd, the Upper Tribunal explained that operator licensing is based on trust. As it is impossible to always police every operator and vehicle, Traffic Commissioners must feel able to trust operators to comply with all relevant parts of the operator’s licensing regime. In addition, other operators must be able to trust their competitors to comply, otherwise they will no longer compete on a level playing field. Unfair competition is against the public interest because it encourages operators to cut corners in order to remain in business. I quote from the decision: “It is also important for operators to understand… the old saying that: “actions speak louder than words”. We agree that this is a helpful and appropriate approach. The attitude of an operator when something goes wrong can be very instructive. Some recognise the problem at once and take immediate and effective steps to put matters right. Others only recognise the problem when it is set out in a call-up letter and begin to put matters right in the period before the Public Inquiry takes place. A third group leave it even later and come to the Public Inquiry with promises of action in the future. A fourth group bury their heads in the sand and wait to be told what to do during the Public Inquiry…. However it seems clear that prompt and effective action is likely to be given greater weight than untested promises to put matters right in the future.

Applying those principles, when I posed the question from the appeal decision 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? I could not reach a positive conclusion. Indeed, if compliance remains as I found it today, the operator will need to be removed from the industry and permanently. I therefore determined that the licence be revoked from 23: 45 on 19 July 2023 to prompt the operator to finally address all the issues set out above. Following that all current licence documentation and UK Licences for the Community must be returned. Credit is reflected in the decision not to disqualify and there is yet opportunity for the operator to obtain a new licence, but it will need to satisfy me that there is full compliance. The operator indicated that it might seek a full audit, but that is for the Director to explore.

R Turfitt

Traffic Commissioner

19 April 2023