How to manage chain of responsibility compliance of contractors and subcontractors
Many players in the transport industry have a practice of contracting and subcontracting, often without written contracts due to time pressures and a tradition of verbal understandings and personal relationships.
While there is no question that a piece of paper does not guarantee safety, more and more transport arrangements have been and will be examined by the courts due to the increasing public focus on chain of responsibility (COR) compliance.
Written contracts can be critical for both bringing COR expectations into a relationship, as well as proving to a court that all reasonable steps were taken to ensure COR compliance up and down the chain.
Your COR obligations when engaging contractors and subcontractors
Under the current Heavy Vehicle National Law (HVNL), the prime contractor, consignor and operator (amongst other COR parties) of a heavy vehicle will be deemed liable for a breach of mass, dimension, loading and work/rest hours offences for that vehicle unless the party can show that they have taken all reasonable steps to prevent the contravention.
Deemed liability will be removed from the HVNL in 2018 and replaced with a requirement on all parties to ensure, so far as is reasonably practicable, the safety of transport activities such as consigning, operating and contracting drivers of heavy vehicles.
What is reasonably practicable for each business will depend on its individual circumstances.
However, courts have given us some guidance as to what they expect of COR parties in circumstances where work is contracted and subcontracted to other companies.
You cannot contract out of your COR obligations, however you can and must ensure that your contractors and subcontractors understand and are equipped to comply with the COR obligations arising from the work you are contracting them to carry out.
Case study: reasonably practicable steps
In a recent case, the Land and Environment Court fined a driver $4,000 and a transport company $120,000 plus $27,000 in costs for failing to ensure that dangerous goods transported by road were transported in a safe manner.
Toll Global Forwarding contracted Stockwell International to deliver a load of expandable polymeric beads.
Stockwell subcontracted the work to Darren Hill, who was not licenced to carry dangerous goods.
Hill drove the goods through tunnels in which dangerous goods are prohibited, and the load was not appropriately placarded.
Toll admitted to failing to take the reasonable steps of undertaking checks or providing instruction to ensure that Stockwell or any subcontractors were capable of transporting goods in a safe manner.
The court held that Stockwell failed to take the reasonable steps of (amongst other things) having COR/dangerous goods policies and procedures, ensuring the driver and vehicle were appropriately licenced and provide adequate training and supervision to staff.
While this case relates to dangerous goods rather than COR, the court’s consideration of the failures of the defendants provides practical guidance as to what the court will consider to be reasonable steps to preventing contravention of the law.
Nathan Cecil is a Partner and Triefus a Lawyer at Holding Redlich.
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