RHA stops Odic
Page 18
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THE ROAD HAULAGE ASSOCIATION has succeeded in its opposition to an application for a new international licence by Wilkinson Freight (UK) Ltd, a company formed by the managing director of a firm which went into voluntary liquidation last April.
In refusing the application for 20 vehicles and 15 trailers, North Western Licencing Authority Roy Hutchings said he was of the opinion that the applicant, Brian Wilkinson was not a fit person to hold a licence because of his previous activities as an operator, and that any company of which he was the director or the transport manager ought not to get a licence.
Mr Wilkinson was originally a director of Wilkinson Transport. In 1974, that company amalgamated with a company operated by Michael Tilsley to form Tilsley Wilkinson Transport. Following a disagreement, Mr Wilkinson purchased Mr Tilsley's share of the business and the company's name was changed to Wilkinson Freight in January 1983. That change was not notified to the LA.
In April 1983, the company went into voluntary liquidation. At the creditors' meeting, Mr Wilkinson said the company's problems started in 1981 with the construction of a new building.
Mr Tilsley leaving the company involved it in considerable expense, turnover fell drastically because of competition from owner drivers, and slow payment by customers forced him to refinance.
At the same time it became more difficult to obtain credit.
There were unsecured creditors at the time of the insolvency, and they were owed a total of £75,993.35. That insolvency was not reported to the LA.
There was an arrangement whereby Wilkinson Law Shipping (a non 0-licence company controlled by Mr Wilkinson, hired vehicles from the liquidator, who did not hold a licence then. The drivers were paid by either Mr Wilkinson or Wilkinson Law Shipping.
At the time, for all practical purposes the company continued to operate in exactly the same way as before the liquidation, from the same premises and with the same management, vehicles, drivers and customers.
In September 1983 the newly formed company Wilkinson Freight (UK) purchased the assets of Wilkinson Freight from the liquidator without taking on any of the outstanding liabilities.
Financial evidence concerning the new company was heard in private and Mr Hutchings said he was satisfied it was of appro
priate financial standing. However, certain matters had come to light in that evidence.
Mr Wilkinson had stated in reply to questions from John Backhouse for the RHA that during the period Wilkinson Freight had been operating under the direction of the liquidator, the operation had just broken even or had been subsidised to some extent by Wilkinson Law Shipping. The balance sheet showed that there had been a very substantial profit.
Secondly, Mr Wilkinson had blamed the financial difficulties the company found itself in almost entirely on the activities of his fellow director and not on the reasons he had put before the creditors.
Finally, Mr Wilkinson had said that the liquidation was the only way that the company could continue and ensure the jobs of 30 men. He took that to mean that the liquidation was entered into to avoid meeting proper liabilities of Wilkinson Freight, yet continue in business.