Nico 2014 Limited

On an appeal concerning financial standing for a goods vehicle operator’s licence, the Upper Tribunal must determine fact and law on the material before the Traffic Commissioner, without taking account of later circumstances. The appellant bears the burden of showing that the reasoning process and application of the law require a different conclusion.

Financial standing may be demonstrated in different ways. Failure to show an average balance over the usual 28-day period is not automatically fatal. It may nevertheless indicate precarious finances, particularly where the business depends substantially on credit and the evidence shows a recurring lack of finance. Decision letters refusing applications should communicate the reasoning supporting the result so that any appeal can be informed and properly focused.

Nico 2014 Limited applied for a standard national goods vehicle operator’s licence for one vehicle. The Traffic Commissioner’s office refused the application on the basis that the company had not demonstrated the appropriate financial standing required by Goods Vehicle (Licensing of Operators) Act 1995, section 13A(2)(c).

The applicant had produced financial evidence, including bank statements and credit facilities. The evidence did not show the required level of available finance over a 28-day period and indicated debit or negligible balances at various points. The Upper Tribunal considered whether the Traffic Commissioner’s decision should be disturbed and whether the refusal letter gave adequate reasons.

1. Appeal dismissed. The Upper Tribunal applied its full jurisdiction under paragraph 17(1) of Schedule 4 to the Transport Act 1985. Under paragraph 17(3), it could not consider circumstances that did not exist when the Traffic Commissioner made the decision.
2. Following Bradley Fold Travel Ltd and Another v Secretary of State for Transport [2010] EWCA Civ 695, the Tribunal had to determine the issues of fact and law on the material before the Traffic Commissioner, without the benefit of seeing or hearing witnesses. The appellant had to show that the reasoning process and application of the relevant law required a different view.
3. Financial standing can be demonstrated in various ways, as recognised in Michael Hazell (No 2) [2017] UKUT 221 (AAC). Failure to demonstrate an average credit balance of £8,000 over a fixed 28-day period is not necessarily decisive. In this case, however, the evidence showed precarious finances, considerable reliance on credit, and a business frequently under-financed. The asserted ability to transfer money from another business was unsupported by evidence before the Traffic Commissioner and could not alter the result.
4. The Tribunal criticised the Traffic Commissioner’s letter because it stated the result but gave no reasons, such as the absence of an £8,000 balance over 28 days or reliance on credit. Consistently with the observations in Wajid Bashir t/a MB Travel [2018] UKUT 0401 (AAC) and Sheraz Asghar [2018] UKUT 0442 (AAC), a decision letter should explain the reasoning sufficiently to enable an informed appeal and focused grounds. There was no injustice here because the appellant understood the reasons and addressed them on appeal, but the deficiency remained important.

• Traffic Commissioner for the East of England Traffic Area: refused the application for a standard national goods vehicle operator’s licence by letter dated 18 August 2021.
• Upper Tribunal (Administrative Appeals Chamber): dismissed the appeal.