Road transport liability dangers AICD Review

  • Date:01 Jul 2005
  • Type:CompanyDirectorMagazine
Overloaded and oversize heavy vehicles, with inadequately restrained loads, are a risk to all. But heavy vehicle legislation in Victoria and NSW will hold everyone in the supply chain legally liable. If you consign goods on a heavy vehicle, pack or load those goods, drive the goods or you are the designated receiver at the other end, the new law has the potential to target you.

Road transport liability dangers

Overloaded and oversize heavy vehicles, with inadequately restrained loads, are a risk to all. But heavy vehicle legislation in Victoria and NSW will hold everyone in the supply chain legally liable. If you consign goods on a heavy vehicle, pack or load those goods, drive the goods or you are the designated receiver at the other end, the new law has the potential to target you. Tony Hulett* reports

The Road Transport (General) Act 2005 (NSW) and the Transport Legislation (Amendment) Act 2004 (Victoria) are scheduled to come into force on 1 September.

Both reflect the provisions of the Road Transport Reform (Compliance and Enforcement) Bill (C&E Bill), an initiative of the National Transport Commission (NTC).

The C&E Bill is intended to provide a model, nationally consistent and best practice legislative scheme to improve compliance with and enforcement of road transport laws relating to mass, dimension and load restraint requirements for heavy vehicles.

It is meant to be the precursor for other nationally consistent road transport laws, particularly fatigue, but not Australian Road Rules or dangerous goods.

Because of different jurisdictional compliance frameworks, the C&E Bill is in model form to cater for those differences. Some of its provisions are classed as "desirable" rather than "essential".

NSW and Victoria are the only jurisdictions to pass legislation. At present no other state or territory has legislation before parliament, so nationally consistent legislation is some time away.

The NSW Act stands by itself and comes closer to adopting the C&E Bill's provisions. The Victorian Act amends the Road Safety Act 1986, so it has a different structure. Both use different language and not all C&E Bill provisions are adopted.

These differences could result in significant jurisdictional differences in interpretation and application.

Mass, dimension and load restraint breaches

A heavy vehicle means a vehicle or trailer that has a gross vehicle mass greater than 4.5 tonnes and includes buses.

Breaches relate to overloaded or oversized vehicles and inadequately restrained loads. Oversize covers length, height and width.

Offences are graded:

- Minor risk

- Substantial risk

- Severe risk

The penalties apply according to the level of the offence.

The chain of responsibility

In the transport task there are a number of participants whose roles may dictate or influence the way in which the task is performed leading to a breach of the relevant road transport laws: consignor, packer, loader, operator, driver and consignee.

One party may fulfil a number of roles or each may be independent of the others. For example, the consignor and the consignee may be one and the same, the consignor may be the packer and loader and the operator may be the packer, loader and driver.

It will not be possible to be charged for the same offence in more than one role, but it will be possible to charge someone with different offences in more than one role.

Contracting out of the legislation is prohibited.

Absolute Liability

The legislation operates by a system of absolute liability. A consignor, packer, loader, operator or driver is guilty of an offence if the vehicle is in breach of a mass, dimension or load restraint limit or requirement. A reasonable steps defence is available but not in all cases.

The consignee is in a different position. The consignee will be guilty of an offence if that person engages in conduct that results, or is likely to result in, inducing or rewarding a mass dimension or load restraint limit or requirement.

What is the reasonable steps defence?

It is a defence if the person charged establishes that:

  • the person did not know or could not reasonably be expected to know of the conduct constituting the offence; and
  • either that the person had taken all reasonable steps to prevent that conduct occurring or that there were no steps that the person could reasonably be expected to have taken to prevent the conduct.
The legislation sets out a number of matters a court may have regard to in considering a reasonable steps defence. In terms of practical operation these include:
  • The measures available and taken to include compliance assurance conditions in commercial arrangements with other responsible persons;
  • Compliance with all relevant standards and procedures in a registered industry code of practice. While this is available in Victoria only, it may not preclude such compliance being raised as a defence in NSW.
In April 2004, the NTC issued a draft report dealing with industry codes of practice for heavy vehicle mass, dimension and load restraint, to assist industries and businesses develop voluntary industry-specific codes of practice to improve compliance.

The reasonable steps defence is not available under certain circumstances and there are differences.

NSW, operator and driver: Substantial or severe risk breaches for dimension or load restraint requirements/limits.

Victoria, operator and driver: Minor, substantial and severe risk breaches of dimension or load restraint requirements/limits.

The C&E Bill contemplates that a reasonable steps defence will be generally available, but it lists such a defence as a "desirable - rather than "essential".

Automatic liability for directors or managers

If a company commits a heavy vehicle offence each director of the company and each person concerned in the management of the company is deemed to have committed the offence.

It is a defence if the person charged establishes that:

  • He or she was not in a position to influence the conduct of the person who actually committed the offence; or
  • Being in such a position he or she took reasonable precautions and exercised due diligence to prevent the commission of an offence.
A director or manager may be charged and found guilty, whether or not his or her company has been proceeded against or found guilty of the offence.

The Corporations Act restricts the circumstances in which a company may indemnify directors or officers and whether a company may indemnify a director or officer for any fine will depend upon the circumstances of the case and any indemnification arrangements between them.

D&O insurance will only provide indemnity for any costs incurred in successfully defending any prosecution. Other types of insurance cover may be available.

Penalties

In addition to monetary penalties, courts will be given a discretion to impose a range of other penalties instead of, or in substitution for, monetary penalties.

- Disqualification from registration

- Commercial benefits penalty orders

- Supervisory intervention orders

- Prohibition orders

- Improvement notices

There are also differences in penalties. For example:

NSW: For a severe risk breach by a body corporate of a mass requirement the maximum penalty is $55,000 plus $5500 for every additional 1 percent over 120 percent overloading.

In the case of an individual it is $11,000 plus $1100 for every additional 1 percent over 120 percent overloading.

Victoria: For the same offence in Victoria the penalty for a body corporate is $62,866 (with no provision for any increase based on the level of overloading) and for an individual, $12,577.

Transport documentation and container weight declarations

Some other provisions are worth noting.

It will be an offence for any person to provide transport or journey documentation (such as a consignment note) which is false or misleading and which results in mass, dimension or load restraint breach.

If a consignor offers a freight container for transport the consignor must provide a container weight declaration. In turn the operator must ensure that the driver is provided with a container weight declaration and the driver in turn must not drive a vehicle without one. These provisions are important, not only because of the penalties that apply, but as reliance on a container weight declaration forms part of a reasonable steps defence in some cases.

Significance and effect

The focus has always been on operators and drivers, but now with specific liability imposed on all in the transport chain it is inevitable that a prosecution of a consignor or consignee will come at some point.

The legislation is open to criticism on the basis that it is not uniform. What "nationally consistent" means is open to interpretation and already the differences between NSW and Victoria raise that issue.

All in the chain should review their practices and procedures to measure compliance with the legislation and take whatever action may be necessary to make changes.

Each chain party needs to be in a position to establish a reasonable steps defence where it is available. Where it is not available reasonable steps evidence may go to mitigation of penalty.

This has been a summary of some key aspects. All provisions, particularly those dealing with enforcement, including the right to search premises and remove evidence, are no less important.

* Tony Hulett is on the AICD Law Committee.

More information about the C&E Bill and the NTC can be obtained from www.ntc.gov.au

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