Scott’s Transport Industries Pty Ltd and Anor v Road and Maritime Services

The impact and reach of chain of responsibility laws in the transport industry should not be underestimated. While the defence of having taken “reasonable steps” to ensure compliance with road transport laws is available, it may not be that easy to make it out.

The recent experience of Scott’s Transport and its successful appeal should serve as a timely reminder that chain of responsibility legislation can have serious financial consequences, not only for those in the transport industry.

Although the appeal judgement represented a phenomenal saving for Scott’s, the prosecution involved:

  • more than two years of time diverted from business activities (including 11 Court dates before sentencing in the Local Court) plus associated legal costs;
  • negative publicity for Scott’s; and
  • a strain on relationships with clients who themselves became concerned about their own role in the chain of responsibility.

The time to determine whether reasonable steps have been taken is now – not when charges are laid.

Introduction

In 2003 the Road Transport Reform (Compliance and Enforcement) Bill was introduced by the Commonwealth. The Bill introduced the “chain of responsibility” concept and was intended to provide a nationally consistent framework to improve compliance outcomes for road safety, infrastructure and the environment.

On 30 September 2005 the “chain of responsibility” legislation took effect in New South Wales. During the second reading speech of the Bill for the Road Transport (General) Act in the Legislative Council on 6 April 2005, Mr Costa, the Minister for Roads, said:

Under the new regulatory framework, those other parties in the transport chain who by their actions, inactions or demands put drivers and other road users at risk and gain unfair commercial advantages may also be committing an offence and be liable to substantial penalties. In practical terms, this means that it is essential that all parties to the chain of responsibility – consignors, packers, loaders, operators, drivers and in some cases consignees – need to be aware of the requirements of road transport law particularly relating to mass, dimension and load restraint. They also need to have active systems in place to manage these risks to minimise the chance of road transport laws being breached.” (Hansard, Legislative Assembly, 6 April 2005 at 15050).

The result of the chain of responsibility provisions is that a range of parties can be held responsible for breaches of road transport laws including the owner of the trucks, and their clients, as well as the individuals who are involved in the management of those bodies. None of these parties needs to be aware of the actual offence in order to be made liable for it; nor does the driver need to be charged for another party in the “chain” to be prosecuted. The effect of the legislation – which exists in all states and territories – extends beyond the freight industry, into all major industries which utilise road transport (such as retail, construction, manufacturing and resources). In some states, including Victoria, the chain of responsibility concept has been extended to other means of transport such as bus and rail.

Although the chain of responsibility transport laws are now some years old (and have been re-enacted), Courts in NSW are only just starting to deal with them – with some surprising results.

Background

Following a triple fatality involving a heavy vehicle on the Hume Highway in January 2012, NSW Roads and Maritime Services (RMS) launched “Operation Overland” in which they investigated and charged a number of trucking companies (and their directors and officers) with chain of responsibility offences relating to speeding offences and speed limited non-compliance offences. (Note: heavy vehicles in NSW are required to be speed limited to 100km/h and heavy vehicles travelling at more than 115km/h are deemed to be speed limiter non-compliant). In the majority of cases the trucking company was not aware of the incidents of speeding because no speeding fines had been issued to the drivers or the company.

Scott’s Transport Industries

One of the companies charged was Scott’s Transport Industries, a family company operating out of Mt Gambier which has provided road transport services since 1952. In May 2012 Scott’s was served with Court Attendance Notices which related to 165 instances of alleged speeding between August 2010 and March 2012. In that period Scott’s vehicles had only received infringement notices for 15 of the 165 alleged incidents of speeding. The remainder were picked up by the audit described above.