TC to grant S19 permits providing that Articles of Association are changed to prevent company from paying dividends
Traffic Commissioner (TC) Nick Denton has indicated that he is minded to grant two Section 19 permits to Kendall & Wall Community Interest Co provided he receives proof within five days that the company’s Articles of Association have been changed to prevent it from paying dividends.
At the outset of a Birmingham Public Inquiry the TC said that he had received copies of the Articles, which showed that they did not permit dividends and that there was an asset lock in place.
Strangely, however, a check of the Articles at Companies House showed that they were different to the ones that had been presented to him as they did allow the payment of dividends. The company had previously been a private limited company and it was changed in 2014. The Articles at Companies House were the ones submitted in 2014.
For the company, Michael Wall said that when it changed to a Community Interest Company in 2014 only minor amendments were made to the Articles. However, when they submitted the application for the Permits the Articles were changed and copies sent to Companies House, who appeared not to have yet dealt with them.
After the TC commented that that was four months ago and Companies House usually dealt with matters quicker than that, Mr Wall said that he could let him have a copy of the minutes of the board meeting when the Articles were changed.
In reply to the TC, Mr Wall said that they currently had a seven-seater minibus. In 2015 they acquired a 17-seater but that had since “died” and been disposed of. The intention was to replace that vehicle in the next month or so. The drivers and volunteers were not paid.
The drivers, who were mostly retired, carried out walk round checks before each outing. On average they operated three outings a week to various places, usually in the West Midlands, with an average number of five passengers per outing. They did not have a written maintenance contract just a verbal agreement with the garage.
The larger vehicle had had a tachograph but he had been told there was no requirement to use it. If the new bus was equipped with a tachograph it would not be a problem to use it.
The TC said that the EU Tachograph Regulations applied to the commercial carriage of passengers. His initial view was that this would be regarded as commercial carriage as the passengers were paying.
Indicating that he was minded to grant the application if he received the board minutes showing the Articles had changed by the end of the week, the TC said that he would also require a written maintenance contract within two weeks. The company also needed to chase Companies House.
