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Palletways fights over Welsh area
Page 16
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• by Dominic Perry Pallet network Palletways has become embroiled in an ugly row over the coverage of the Cardiff and Newport postcodes following the collapse of one of its current members. Cardiff Despatch.
The firm, one of the oldest members of the Palletways network, effectively ceased trading this January, with its goodwill apparently bought out by new firm CDL Logistics (formerly GSS Sameday). CDL is run by Mark Rees, Rhyiandd Mitchell and William Bailey. Also involved is Mike Mitchell, a disqualified director (see box below).
It seems CDL believed it was buying membership of Palletways, but when the network pointed out this was not the case, it entered into negotiations in a bid to secure what was effectively Cardiff Despatch's biggest asset.
Caretaker
In the meantime it was agreed that CDL would act as caretaker for Palletways until the issue of membership had been decided.
CDL eventually lost out to local rival John T Evans Haulage. CDL claims that it failed to gain membership because it had not offered enough money for the franchise, a claim that is strongly denied by Craig Hibbert, group development director at Palletways.
Hibbert who points out: "Even if they [CDL) had been offering three times the rate we were suggesting was appropriate, they would not have been offered membership.
"As soon as we became aware of [the situation]. we had a meeting with CDL where we explained that they did not have an automatic right to membership and we would have to go through the recruitment process. We would also have to look at other options in that area...it became apparent that CDL did not meet the criteria and we awarded it to John T Evans," he adds.
However, during the changeover between the two Welsh hauliers, CDL claims that several days' worth of its customers' pallets were held by Palletways at its Lichfield hub, following a dispute over a £25.000 debt it says was owed to Palletways by Cardiff Despatch.
Palletways denies holding freight but says that some economy loads may have been delayed: "Maybe there was some traffic in the hub outside the normal timeframe, but there was some doubt whether we were going to receive payment for deliveries," says Hibbert. "There was a dispute as to who would pay for that traffic."
He adds: "We took that traffic and spoke to CDL customers directly. We had a responsibility to make sure we didn't compound problems by putting traffic through the system that we may not get paid for."
Problem
Several of CDL's customers confirm that goods were delivered late and a letter from CDL's solicitors to Palletways suggests a problem between the two.
In an extra twist, Palletways has started legal proceedings in a bid to recoup money A claims it is still owed by CDL.
But Rees argues that CDL had no agreement with Palletways and in effect was subcontracting for Cardiff Despatch, which therefore carries the debt.