The Upper Tribunal has dismissed an appeal by London Bus Group Ltd against the revocation of its six-vehicle O-Licence by then-Scottish Traffic Commissioner (TC) Claire Gilmore after it failed to produce the required financial evidence after being given a period of grace.
The operator was called to a conjoined Public Inquiry (PI) in Edinburgh in February 2023, together with Club Class (Edinburgh) Ltd, which held a one-vehicle O-Licence and had Transport Manager problems, and Club Class Bus Ltd, which held a two-vehicle O-Licence in the North West and a two-vehicle licence in the North East; the sole Director of the three companies being Dwayne Thandrayen.
Mr Thandrayen was notified that London Bus needed to show access to an average of ÂŁ30,500 over the previous three months. Financial standing needed to be demonstrated to show access to an average ÂŁ63,500 for all four licences.
Mr Thandrayen gave evidence that the Club Class Bus businesses and London Bus were all part of the National Bus Group, of which he was again sole Director. Those businesses generated revenue, and National Bus Group was a centralised operating expenses company, which avoided the need for different accounts payable departments.
The TC gave the four companies a four-week period of grace to provide the required financial evidence. No such evidence was received.
The TC then accepted the surrender of the Club Class Bus licences and granted London Bus a further 14-day period of grace.
Request for PI
London Bus and Mr Thandrayen did not provide the required evidence by 4 April 2023. Instead, on that day, he submitted an application to the South Eastern and Metropolitan Traffic Area to increase the authorisation on the licence from six vehicles to 10, and requested a PI. He also sent an email to a caseworker in the TC’s office informing them of the application made and the request for the PI “for which [he] will provide the required financial details to support said application”.
No reference was made to the failure to provide evidence of financial standing in relation to the existing authorisation.
TC Gilmore revoked the O-Licence on 18 April 2023, saying Mr Thandrayen was already on the clearest of notice that his licence was liable to revocation.
He had the impact of failure to demonstrate appropriate financial standing explained to him in person, at PI, and in several letters from the TC’s office since. He had chosen to ignore all of that, and instead lodged a variation application as if nothing were amiss. It was also pertinent that Mr
Thandrayen happened to be an experienced operator; she granted a stay, pending an appeal.
The appeal was first listed for hearing on 21 September 2023 but was adjourned. There were further delays and difficulties in listing the case.
At the appeal hearing in January of this year, Mr Thandrayen explained that the Liverpool, Newcastle and Edinburgh businesses had not recovered from the effects of the COVID-19 restrictions and so he had surrendered the relevant licences. He had concentrated on London Bus and had applied to vary the licence. That business was operating and was providing minibus services, transporting children for educational reasons.
There had been some delays in payment, but he had produced evidence of financial standing. The companies had separate bank accounts, but all payments came out of the shared services company accounts. London Bus made payments into the account, and its payments were going out of it. He felt he had misunderstood the process because he had expected to be called to a PI, and he would have been able to go through the financial standing material then. It was not a deliberate failure to provide evidence of financial standing. He accepted that he might have got it wrong.
The Upper Tribunal said that Mr Thandrayen rightly identified himself as the common feature of the three companies, since he was the common and sole Director. He was also the sole Director of the immediate parent company, National Bus, and of the ultimate parent, Protea Capital.
As the sole Director, he was the person responsible for ensuring compliance with the regulatory regime in the case of each company. His approach to compliance as demonstrated in relation to one company was clearly capable of having evidential significance in relation to another. Given that background, the Tribunal did not find it surprising that the TC expressed concern about the good repute of London Bus, which effectively meant the repute of Mr. Thandrayen himself.
Questions over funds
It is almost invariably the case that when an operator of the size of these companies is called to PI, evidence of continued financial standing will be required. This was a classic case in which a large part of the financial resources of all three operating companies was apparently passing to the parent, National Bus. Certainly, that was the case as respects London Bus. Such an arrangement inevitably raised questions whether the necessary funds were readily available to the particular subsidiary or whether, on a call for funds, it might turn out that the parent’s resources had gone to another subsidiary.
The TC found that London Bus did not satisfy the requirement of appropriate financial standing and so she came under an obligation to revoke the licence. That finding of fact was not challenged, and could not realistically have been challenged, given the information before the TC. London Bus did not suggest that it provided evidence of financial standing by the required date. The inevitable result was that the TC was obliged to revoke the licence.
Instead of heeding the warnings given to him, Mr Thandrayen waited until the last day of the period of grace and then made an application to vary the licence to a different TC’s office without providing any evidence of financial standing. The TC, who had heard him at some length at the Inquiry, took the view that that was a deliberate ploy, and the Upper Tribunal could understand why she did so. All Mr Thandrayen needed to do was to produce the evidence which he had said he could easily produce, but he chose to take a different course.
