Revocation and disqualification orders thrown out as Tribunal says TC ‘applied the incorrect test’
The revocation of the 14-vehicle international O-Licence held by Exeter-based CM Coaches and the three-year disqualification of former Director Michal Hazell from acting as a TM by Traffic Commissioner (TC) Kevin Rooney, has been quashed by the Upper Tribunal on appeal, who directed that the cases be reconsidered by a different TC.
Michael Hazell had been a Director of Carmel Coaches whose licence was revoked in June 2014 along with his sole trader licence, and Mr Hazell and his father Anthony disqualified for 18-months, decisions that were upheld on appeal [routeone/Court Report/12 November 2014].
An unsatisfactory maintenance investigation was carried out in June 2018 following reports of an undeclared fire on a bus carrying children. Michael Hazell was keen to distance himself from anything that had occurred whilst he was neither Director nor TM.
In December the company cancelled its registered bus services in favour of Carmel Coaches. On 10 December 2018 Michael Hazell, as sole Director and TM, was removed from the licence. A new TM and Director, Alastair Gray, was to be appointed by the purchasers.
Alastair Gray was a director of Hookways from 2006 until the company entered insolvent liquidation in August 2011. He was a director of Hamilton Grays (Devon) from August to November 2011, when its licence was revoked on financial grounds [routeone/Court Report/22 August 2018].
Making the revocation and disqualification orders, the TC said that the gross failures in the maintenance systems pointed to a complete lack of management control. Mr Gray referred to purchasing a “going concern”. All the registered services were cancelled. The operating centre, staff and vehicles did not transfer.
He concluded that the only real value in the purchase of CM Coaches lay in its O-Licence. By buying the company, and the O-Licence, Mr Gray had side-stepped the scrutiny that applied to new applicants [routeone/Court Report/7 August].
In its decision, the Tribunal said that it did not consider that there was anything wrong in a company with an O-Licence being purchased without physical assets. There was value in a business registration and in the name of a company which, in the normal course of events, would have goodwill attached to it.
In this instance, there was a likelihood of two significant contracts transferring with the sale. That does not mean that the acquisition of the company should not be the subject of close scrutiny, particularly if there was any suspicion of “fronting”. Mr Gray was being advised and was assisted by an officer of the CPT. It could not be suggested that there was anything underhand in the acquisition of the company by Mr Gray. It clearly was not a “front” and he had been encouraged to apply for another licence.
The TC should not have considered the position of the company as though it was a new application and in doing so, he applied the incorrect test. If he had applied the correct test, the TC might have come to the same conclusion.