Vehicle & Operator Services Agency v Ace Crane & Transport Ltd [2010] EWHC 288 (Admin)

Case No CO/12574/2009[2010] EWHC 288 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
DIVISIONAL COURT
Venue Royal Courts of JusticeDate Tuesday, 19 January 2010
Strand
London WC2A 2LL
B e f o r e:
LORD JUSTICE SULLIVAN
MR JUSTICE LLOYD JONES
Between
VEHICLE AND OPERATOR SERVICES AGENCYClaimantv
Between
ACE CRANE AND TRANSPORT LTDDefendant
Computer-Aided Transcript of the Stenograph Notes ofWordWave International LimitedA Merrill Communications Company165 Fleet Street London EC4A 2DYTel No: 020 7404 1400 Fax No: 020 7404 1424(Official Shorthand Writers to the Court)
MR J BARKER (instructed by HUGH JAMES SOLICITORS) appeared for ClaimantMR C OVER (instructed by OVER, TAYLOR, BIGGS SOLICITORS) appeared for Defendant
J U D G M E N T
[1]MR JUSTICE LLOYD JONES: This is an appeal by Case Stated from the decision of Deputy District Judge Hines sitting at North Avon Magistrates' Court on 30 July 2009. The respondent, a limited company, is prosecuted by the Vehicle and Operator Services Agency in respect, inter alia, of nine allegations of permitting a driver to fail, without reasonable excuse, to make a record or entry required by the Community Recorded Equipment Regulations, contrary to sections 97 and 99 ZE(1)(d) of the Transport Act 1968. The respondent company pleaded not guilty to those offences, but guilty to a further five offences of strict liability.[2]At the trial before Deputy District Judge Hines, the appellant ("the agency") sought to rely on evidence of failures to act on what may be characterised as errors or omissions to make records or entries dating back to June of 2008. No "bad character application" had been made for permission to rely on these earlier instances. The Agency contended that the evidence relating to this earlier conduct was background to the alleged offences rather than evidence of bad character. The deputy district judge concluded that the appellant was seeking to lead evidence of bad character and should either have charged these matters as separate offences or should have made a bad character application within the provisions of the Criminal Justice Act 2003, and in accordance with the timescales prescribed by the Criminal Procedure Rules 2005.[3]We have been told that, thereafter, no application was made for leave to adduce this evidence as bad character evidence, notwithstanding the failure to comply to the rules, the district judge having, by that point, already made abundantly clear that he would not accede to such an application. The deputy district judge then heard a submission of no case which he accepted. It is common ground before us that he had no alternative, given the exclusion of that evidence.[4]The following questions have been referred for the opinion of this court: 1). Was the court right to refuse to allow the prosecutor to adduce evidence relating to the driver's records for a period before that in which the offences before the court were alleged to have been committed, for the purpose of proving that the defendant company permitted the commission of the said offences? 2). Was the court right to refuse the admission of such evidence as evidence of the bad character of the defendant company, no formal application to do so having been made before the court ruled that the evidence referred to in question 1) above was inadmissible?[5]On 31 October 2008, Simon Atherton, an employee of the company, was the driver of an articulated unit when he was stopped on the A46 at Tormarton in Gloucestershire. The traffic examiner, Mr Beaver, asked him to produce his tachograph charts and 24 charts were produced. An initial examination revealed missing mileage. In interview under caution, Mr Atherton admitted that he had not kept appropriate records or made appropriate entries in those records on at least nine occasions between 29 September 2008 and 30 October 2008.[6]In due course, Mr Atherton pleaded guilty to nine offences of failing without reasonable excuse to make relevant records as required by the Community Recording Equipment Regulation, or section 97 of the Transport Act 1968, contrary to section 99 ZE(1)(d), 2(a) and 4 of the Transport Act 1968. Tachograph records were further studied by the Agency, in particular by the traffic examiner, Mrs Edmonds. She then made a visit to the premises of the defendant company where she served a notice requiring the production of relevant records.[7]Mr Trevor Clarkson and Mr Ronald Clarkson of the respondent company attended for interview in due course, at which they produced further records. Mrs Edmonds later conducted a full analysis of the records provided by the company and produced a spreadsheet which demonstrated 17 instances of exceeding the 4.5 hours driving limit and failing to take a required break or breaks, nine instances of exceeding the daily driving limit, two instances of failing to take sufficient daily rest, and nine instances of failing to record all driving duties.[8]14 informations were laid in the Magistrates' Court against the defendant company. Nine of those informations alleged that on dates between 29 September 2008 and 30 October 2008 the company had permitted Simon Atherton to fail without reasonable excuse to make a record or entry required to be made for the purposes of the Community Recording Equipment Regulation, or section 97 of the Transport Act 1968, contrary to section 99 ZE(1)(d) 2(a) and 5 of the Transport Act 1968. It is necessary to refer to the precise terms section 99 ZE(1)(d): "A person commits an offence ... if he fails without reasonable excuse to make a relevant record or entry, or causes or permits such a failure".[9]I have already referred to the five further informations laid against the company. Those were offences of strict liability to which the company pleaded guilty.[10]Section 98 of the Criminal

Justice Act 2003, which lies at the heart of this appeal, provides:

"References in this chapter to evidence of a person's bad character are to evidence of, or of a disposition towards, misconduct on his part, other than evidence which a) has to do with the alleged facts of the offence with which the defendant is charged..."
[11]If the evidence is evidence of bad character within this provision of the Criminal Justice Act, its admissibility then has to be determined in accordance with the following provisions of the statute and the provisions of the Criminal Procedure Rules governing notice of intention to adduce evidence of bad character.[12]The nine charges with which we are concerned related to the period 29 September 2008 to 30 October 2008. The evidence which was excluded was contained in schedules, and that evidence related to the period 1 July 2008 to 31 October 2008. The dates are of particular significance because, under the applicable regulations, the driver was required to have the tachograph graphs in his cab for the preceding period of 28 days, and he was permitted to have them in his cab for a preceding period of 42 days. Accordingly, there could be no criticism of the company for failing to check the records in that 42 day period. That, it may be thought, gives rise or could give rise to difficulties of proving an offence on the part of the company of permitting failures. That is a matter to which Rose LJ referred in his judgment in the Yorkshire Traction Company Case; Yorkshire Traction Company Limited v Vehicle Inspectorate [2001] Road Traffic Reports, page 34.[13]In the present case, the record sheets obtained by Mr Beaver, the examiner who was present when the vehicle was stopped, were either still required by law to be held by the driver, Mr Atherton, or in the case of the earliest, were permitted to be held by him. Accordingly, they either could not have been available to the employer for analysis or need not have been, and therefore, it may be thought, could not have supported a charge of permitting a failure to make records on the part of the company.[14]There were no charges in relation to the period prior to 42 days prior to 31 October 2008.[15]On behalf of the Agency, Mr Barker points to the fact that the offence contrary to section 99 ZE(1)(d) is a summary offence and that older records will often be outside the statutory 6-month period for the laying of an information. He also submits that laying informations for all offences discovered by the Agency would be disproportionate and unacceptable to the courts. However, he submits that the excluded evidence went clearly to the issue of whether or not the defendant company permitted the driver to commit the index offences. In this regard, he relies in particular on the speeches in the House of Lords in Vehicle Inspectorate v Chaney, Raymond and Nuttall, trading as Red Line Coaches [1999], 1 WLR 629, where it was accepted that, in order to prove an offence of permitting certain conduct, it was necessary and permissible to refer to failures in an earlier period.[16]On behalf of the company, Mr Over takes issue with the suggestion by the Agency that what occurred in this case was the exclusion of evidence relating to systems. He points to the fact that certain evidence was admitted which relates to the system operated by the defendant company. In particular, he says that Mrs Edmonds gave evidence at the hearing in relation to systems, although she was not permitted to refer to the schedules relating to the earlier alleged breaches. She also gave evidence as to the interview with the defendant. He maintains that Mrs Edmonds was not prevented from giving any evidence she wished as to the defendant's procedures, and that those were in fact referred to in the interview and in the documents relating to the interview which she exhibited.[17]Evidence was given of the systems the defendants had in place to check tachograph records. These included notes to drivers and a copy of the guide the drivers were given relating to the Regulations. Mrs Edmonds, in her evidence, also accepted that she had seen the hand written analysis undertaken by Mr Clarkson when checking tachographs. On this basis, Mr Over submits that, at the time the deputy district judge dealt with the argument in relation to the schedules, he already had information about the company, its practices and procedures, and the detectability of the offences. However, Mr Over submits that the excluded evidence did not go, as the agency maintains, to the failure of the company to have in place an effective system to ensure compliance with the regulations relating to driver's hours. He maintains that the excluded evidence was an attempt to introduce what Mrs Edmonds said were previous offences to show that the company should have been on notice that Mr Atherton would have committed further offences. That, he submits, is evidence of a disposition towards misconduct and should be admitted only if it is admitted pursuant to an application pursuant to the Criminal Justice Act 2003.[18]It is common ground before us that it was open to the Agency to adduce evidence of an earlier period in order to prove the system which was in operation at the time to which the charges related, and it appears that that was what occurred in this case. The question for our consideration is whether it is permissible, without making a bad character application, to adduce evidence of breaches by drivers in an earlier period and a failure to detect or act on them, as evidence capable of supporting the view that the offences of permitting a failure to make an entry or record were committed by the operator during the relevant period. That, it seems to me, was the significance of the evidence of Mrs Edmonds which it was intended to adduce and which was excluded. In this regard I draw attention in particular to one paragraph in her witness statement: "There are 63 tachograph record sheet in the name of Simon Atherton that were in the position of the operator and were produced at the interview with the operator. Of those records I attach 24 as a four page-exhibit, which show 17 instances of exceeding the 4.5-hour driving limit and failing to take the required break or breaks, nine instances of exceeding the daily driving limit, two instances of failing to take sufficient daily rest, and nine instances of failing to record all driving/duty. The operator has produced no evidence of any disciplinary action taken against Simon Atherton for any of these matters. In that respect the operator has failed to show compliance with EC Regulations, and, in particular, Article 10 of EC Regulation 561/2006".[19]The schedule to which that refers is a detailed analysis of journeys carried out.[20]To my mind the answer to the first question posed for this court lies in the reasoning of the House of Lords in Vehicle Inspectorate v Nuttall [1999] 1 WLR 629. There, the owner of a coach business was charged with permitting his drivers to contravene the requirements of the applicable Community Rules regarding drivers' hours, contrary to section 96 11(a) of the Transport Act 1968. As that statutory provision then stood, it provided: "Where, in the case of a driver of a motor vehicle, there is, in Great Britain, the contravention of any requirement of applicable Community Rules as to period of driving or distance driven, or periods on or off duty, then the offender, or any other person (being the offender's employer or a person to whose orders the offender was subject) who caused or permitted the contravention shall be liable on summary conviction to a fine".[21]Of particular importance to the present case is the speech of Lord Hobhouse. At page 640 B to E, he observed: "It is already mentioned that the conduct constituting the actus reus must also have a causal relationship to the conduct of the employee which constituted the employee's breach of the regulation. Where the employer is charged with having caused the employee's breach, the need for the prosecutor to prove such a causal relationship is obvious. Similarly, where the employer is merely charged with permitting, the conduct of the employer must still have been conduct which permitted the employee to commit that breach, ie failed to prevent him from exceeding the limits on that particular occasion. The employer's conduct must, therefore, be conduct which preceded the employee's breach, and it must be shown that the performance by the employer of his duty could have prevented that breach. The actus reus of the offence of permitting, under section 96 119A), is failing to take reasonable steps to prevent the breach in question. This may be proved in any of a number of different ways depending upon the circumstances of the case. For example, in some cases it may be proved by showing a systematic failure of the requirement to perform his duty which, it can be inferred, contributed to the specific breach of the employee. In others, it may be proved by showing that earlier breaches by the particular employee or his fellow employees had not led to any interventions by the employer, either because they had not been picked up, or, having been picked up, had been ignored or inadequately responded to by the employer".[22]The actus reus of the offence can, it seems, be proved by evidence of a systematic failure of the employer to perform his duty. That must necessarily relate to failures prior to the specific contraventions by drivers which gave rise to the index charges. This seems to me to lead inevitably to the conclusion that the earlier failures by the employer to perform his duty have to do with the alleged facts of the offences with which the defendant is now charged, within the meaning of section 98A of the Criminal Justice Act 2003. As such, these matters are not evidence of a person's bad character within the provisions of the Criminal Justice Act.[23]However, Mr Over, on behalf of the company, points to the fact that the nine offences with which Ace was charged are under a different statutory provision. Section 96 11(a) has been amended and replaced by an offence of strict liability. In the present case, the nine charges with which we are concerned were brought were not under the amended 96 11(a) but under section 99 ZE(1)(d) in the form which I have already set out in this judgment.[24]Mr Over accepts, correctly in my view, that the logic of the reasoning in Nuttall applies equally to an offence of permitting a failure under this provision. However, he points to the fact that the offence here is one of permitting a failure to record something entirely as opposed to permitting a erroneous entry. On this basis he accepts, applying the reasoning in Nuttall, that evidence of earlier failures of the driver to make a record which had not been spotted by the employer, would be admissible as evidence tending to support the allegation of permitting such a failure on a later occasion without the necessity of making a bad character application. That would be covered by section 98A of the Criminal Justice Act. However, he submits that what would not be permitted without a bad character application would be reliance on a failure to identify and act upon earlier erroneous records. That, he submits, does not have to do with the offence on the basis established by Nuttall, but is an attempt to rely on a disposition to act in a similar way, and that would require a bad character application. In this regard he contends that the earlier conduct on which the agency sought to rely was for the greater part not concerned with earlier failures to act on a failure to make records. Of the 17 instances on which the agency sought to rely, only 7 related to a failure to make records as opposed to making erroneous records.[25]However, this adopts too narrow an approach to the identification of evidence which has to do with the alleged facts of the offence with which the defendant is charged. To my mind, evidence of earlier failures to act on erroneous records is at least as probative here as earlier failures to act on a failure to make records. A failure to spot an erroneous entry shows that you are just as likely to miss a non-entry. Both may properly be regarded as having to do with the alleged facts of the offence with which the defendant is now charged. Indeed, were the position otherwise, it would lead to the paradoxical situation that failure to act on the more serious case of a false entry would not be admissible, but failure to act on a failure to make an entry would be. Moreover, the distinction which Mr Over seeks to draw will not always be an easy one on the facts, as became apparent when he took us to the schedule to identify the seven cases. Instances of non-entries and erroneous entries are often combined.[26]For these reasons, I consider that the material on which the agency sought to rely was to do with the alleged facts of the offence with which the defendant company was charged. Accordingly, it should have been admitted in this case. It was not necessary for there to be a bad character application. I would answer the first question accordingly. In those circumstance the second question does not arise.

LORD JUSTICE SULLIVAN: I agree. So question 1) is answered in the negative, it is unnecessary to answer question 2).

[28]Mr Barker, we imagine that you will want this remitted to a differently constituted court?[29]MR BARKER: Yes please, my Lord, for a fresh hearing.

LORD JUSTICE SULLIVAN: Yes, for fresh hearing. Can you resist that, Mr Over?

[31]MR OVER: No, my Lord.

LORD JUSTICE SULLIVAN: No. Thank you very much.

[33]MR BARKER: My Lord, I also have an application for costs.

LORD JUSTICE SULLIVAN: Yes.

[35]MR BARKER: A schedule has been served on my learned friend.

LORD JUSTICE SULLIVAN: Is there an objection, either in principal or in detail, Mr Over?

[37]MR OVER: Both.

LORD JUSTICE SULLIVAN: Both. Right we had better have a look at it. Could I just mention, was it 17 instances relied on or was it 17 failures shown out of the 67 sheets, or 67 sheets of which 24 were produced?

[39]MR BARKER: Yes.

LORD JUSTICE SULLIVAN: Just substitute -- when my Lord sees the transcript -- I think for 63 substitute 17.

[41]MR BARKER: My Lord, if I can be just pick up, my Lord mentioned the speech of Lord Steyn, it was in fact Lord Hobhouse.[42]MR JUSTICE LLOYD JONES: Yes. Thank you very much.

LORD JUSTICE SULLIVAN: Right, so you are claiming these costs. Shall we just see what Mr Over has to say about it?

[44]MR OVER: My Lord, as far as principle is concerned, my clients are a very small company struggling in a very difficult economic climate and got caught up in this offence, firstly, before an incredibly enthusiastic district judge who clearly, as I think you can tell from the papers, took rather a dim view of how the matter was put before him by VOSA. I think it fair to say that the prosecutor made none of the arguments that have been made before this court and really did not respond in any way at all to what was very clearly a district judge led attitude towards the evidence in this case. Having said that, VOSA also make it clear that they wanted this clarified because there were hundreds of occasions when they use similar evidence, and they wanted the matter clarified, I have no doubt, for those purposes. In those circumstances, I would ask the court to consider very carefully that there should be no order for costs.[45]If you are against me on that then I will make some comments on the schedule.

LORD JUSTICE SULLIVAN: It might be convenient if you just put all your points together.

[47]MR OVER: My comments on the schedule, firstly, I think it is accepted by my learned friend that VAT is not chargeable. The amount of time involved by solicitors, at 14 hours altogether, is, in my submission, excessive. This is a case where the solicitors were acting on behalf of VOSA, they had to instruct counsel to deal with the Case Stated, the appellant's notice included no notice of appeal settled by them, and it is very difficult to see how, in preparation of instructions to counsel to deal with this, where paperwork is relatively small, it could take almost 9 hours.

LORD JUSTICE SULLIVAN: They wrote lots and lots of letters, and made lots and lots of telephone calls.

[49]MR OVER: Well, they did not write them to me, because I only had about four, so I am not sure who they were writing to. I do query the attendance here, the solicitors were here for the previous case as well so there should be a sharing of travelling time and costs. And it is notable that the solicitor who presented this case in the Magistrates' Court is not the one who is here. Counsel can attend on their own, they do not have to have solicitors with them. If they were going to have solicitors at not insubstantial cost, perhaps it should have been the one who was actually in court rather than somebody else who was not. Other than that, the only comment I would make, perhaps tongue in cheek, is that counsel's fee is reasonably high, given VOSA, I know, are quite serious negotiators where fees are concerned.

LORD JUSTICE SULLIVAN: If they had not been it might have been even higher.

[51]Thank you very much. Mr Barker, we need not trouble you on the principle, we think that, however enthusiastic the deputy district judge was, there was no attempt on the part of the respondent to rein him in or discourage his enthusiasm, so I am afraid the respondents must take the consequences of that. We do think, our provisional view is, that there were quite a lot of letters, quite a lot of telephone calls, quite a bit of preparation. I realise this is a case that is fairly heavy so far as Case Stateds go. It is important from the point of view of authority. We are thinking of something like a grand total of £5,000, doing the best we can. Do you reckon you can do better than that?[52]MR BARKER: No, I do not.

LORD JUSTICE SULLIVAN: Right. I suppose we ought to ask, do you think you ought to do worse than that?

[54]MR BARKER: Well, my lords, my learned friend, without counsel was £4,904, so I think £5,000 is sensible.

LORD JUSTICE SULLIVAN: That is very reassuring.

[56]So the appeal is allowed in the terms we have just described. The matter is remitted to be considered by a differently constituted court and the respondent is to pay the appellant's costs summarily assessed in the round sum of £5,000. Any more for any more?[57]MR OVER: Could I ask that it be transferred to the local Magistrates' Court for payment, then they can determine a figure at which it should be paid per month?[58]MR BARKER: In fact it is a civil award, so it cannot be done like that.[59]MR OVER: Perhaps I could ask for two months for payment of that?[60]MR BARKER: I am sure the Agency will not be taking enforcement action within two months, my Lord.

LORD JUSTICE SULLIVAN: No. You can have your 2 months, yes.

[62]Thank you both very much indeed, a very interesting argument.