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Chain of Responsibility: 2020 year in review

03 March 2021

#Transport, Shipping & Logistics

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Chain of Responsibility: 2020 year in review

Now that you’re all back up to speed after easing into the New Year through February, we thought that we’d do a round-up of the more significant Chain of Responsibility (CoR) investigations, enforcement actions and court cases of 2020.

In this wrap-up, we look at:

First CoR prosecution launched under the new Heavy Vehicle National Law – February 2020

The NHVR launched its first prosecution under the revised HVNL against Godfrey Haulage for alleged failure of the business to comply with the conditions of its fatigue management accreditation.

Under section 26D, the Executive of a party in the chain has a duty to ensure that the business complies with its duties under the HVNL. Accordingly, the sole director of the business was also prosecuted for alleged failure to exercise due diligence under the Executive duty.

The investigation was commenced after a report was made to the National Heavy Vehicle Regulator’s (NHVR) Heavy Vehicle Confidential Reporting Line (HVCRL). As its name implies, the HVCRL is a confidential or anonymous reporting line that anyone can use to report suspected safety issues involving heavy vehicle use, including suspected breaches of the HVNL.

The NHVR combined the report with its own risk profile of the business in order to determine that further investigation was necessary. The NHVR uses technology to keep track of the safety and compliance record of road transport supply chain businesses. Businesses that are tracking above the industry average can be identified for targeted investigation and enforcement action. In this way, the NHVR can focus its attention where they are needed more and more likely to make an immediate improvement to on-road safety.

As of the time of writing, the case was adjourned (due to COVID-19) and awaiting a final hearing.

First Enforceable Undertaking (EU) accepted under HVNL – March 2020

On 25 March 2020, the NHVR accepted an enforceable undertaking offered by engineering and construction company, Laing O’Rourke Australia Construction Pty Ltd (LORAC). The offer by LORAC was made in circumstances where Transport for NSW charged it with two severe risk breaches of mass requirements under section 96(1)(c) of the HVNL. The estimated value of the steps proposed by LORAC to ensure compliance with its mass HVNL obligations is about $249,500, so not a cheap exercise.

A CoR party may consider offering an EU as an alternative to being charged with contravening the HVNL. It is available in relation to all offences except for serious category 1 offences of breaching a primary duty. The incentive for offering an EU to a regulator is essential to stop it from advancing a prosecution against a CoR party.

EUs can be costly depending on the nature of your business and the causes of your breaches. LORAC’s EU included a commitment to implement the following HVNL compliance strategies:

  • training for LORAC employees that targeted improved awareness of CoR requirements, which LORAC estimated would require a minimum commitment of $134,500 by them
  • CoR training for supply chain partners in NSW, Victoria and South Australia with an estimated minimum commitment of $80,000
  • a third-party transport safety management system audit estimated to cost LORAC $35,000.

Failure to comply with an undertaking exposes a CoR party to three key outcomes:

  • the NHVR could apply to a tribunal or court for orders that the CoR party pay a penalty for its non-compliance. The maximum penalty for a breach of an EU is $50,060 (up to July 2020) for a company or $11,210 (up to July 2020) for an individual
  • in addition to seeking orders for a penalty, the NHVR could seek orders for the CoR party to comply with the EU or to otherwise discharge the EU
  • proceedings relating to the original charges may be re-enlivened.

Speed limiter tampering leads to a $10K fine – July 2020

In July 2020, a Queensland transport operator was fined $10,000 after investigators detected that a speed limiter in a fleet vehicle was set at 125km/h, 25km/h above the applicable limit.

The vehicle was stopped at a heavy vehicle checking station as part of a routine inspection. Tests conducted on the speed limiter showed that it was set significantly higher than the maximum legal speed limit for the vehicle and in breach of the speed limiter obligations under the HVNL.

Even though no speeding offence was actually detected, the company was nevertheless prosecuted, with the prosecutor submitting that the penalty should be at the higher end of the spectrum, due to the significant extent to which the speed limiter setting permitted a violation of the maximum speed of the vehicle and the significant risks that this posed to safety. Further, Roads and Maritime Services NSW indicated that the business would be under increased regulatory scrutiny as a result and, if further speed-related offences were detected, further enforcement action would be taken.

Over dimension while going over a bridge result in a $9K fine – July 2020 

Veolia Environmental Services (Veolia) was fined $9,000 for a 2018 over-dimension incident on the Tasman Bridge in Hobart. Veolia was engaged to transport empty jet fuel drums in a ‘C-Type’, ‘non-standard’ container with a higher than normal height of 9’6”.

Nothing in Veolia’s processes flagged the extra height. A typical tilt-tray heavy rigid vehicle was assigned. The driver conducted a visual inspection of the load but failed to notice visible ‘caution’ signs indicating the over-height of the container and did not take steps to ensure that the loaded truck was within the overall height limit.

The loaded truck did not comply with the applicable dimension requirements and was 180mm higher than the signposted 4.3m maximum height on the route.

The top of the container hit the bottom edge of an overpass on the Tasman Bridge, causing damage to the bridge and colliding with a following light vehicle when the container was dislodged from the truck.

The Court accepted that the driver had relevant training and experience, but further observed:

“The defendant’s internal procedures ought to have been engaged, to ensure that somewhere between the point in the system or operation where the job request was received and the point at which the container was loaded on the truck, there was a proper response to the unusual height of the container so that when it was being transported, the load height did not exceed 4.3m.”
“It appears that the defendant instead relied too heavily on the experience and training of its employed driver; and the driver had, in breach of his responsibility, relied on those loading the container onto the truck.”

This case highlights that people often mistakenly rely on experience instead of having in place written, tested safety procedures.

“Lose your work diaries” results in a $6K fine – August 2020 

In August 2020, the depot manager of a WA-based transport company was convicted for making a prohibited request under section 26E of the HVNL.

Two drivers engaged by the company were scheduled to do a Perth-Sydney-Perth run.

On the return leg, the drivers notified the depot manager that they each needed to take their mandatory 24-hour rest break.

The depot manager responded by telling the drivers to ‘lose’ their work diaries and continue driving. Presumably fearing repercussions for not following the direction, the drivers continued driving.

The vehicle was intercepted by NHVR officers as part of routine inspections near Ceduna. By this time, they had been driving for eight days without the mandated 24-hour rest break.

Upon being informed by the drivers of the direction they were given to continue driving, an investigation was launched into the conduct of the depot manager.

The depot manager was charged with one offence for each driver for "asking, directing or requiring the driver to do something that they know would have the effect of causing the driver to drive while impaired by fatigue or drive in breach of work/rest hours".

The maximum penalty was $11,120. The Court imposed fines of $4,000 per offence, reduced by 25 per cent to $3,000 per offence, in recognition that the depot manager entered a guilty plea early in the proceedings, thereby avoiding the time and cost of a contested charge. The depot manager had convictions recorded against them.

$80,000 fines for fatigue breaches – August 2020

In August 2020, a Queensland trucking company was fined a massive $60,000 for two breaches of its primary safety duty under section 26C of the HVNL, evidenced by 36 cumulative breaches of work/rest hours by two long-distance drivers employed by the company. In addition, the two drivers were together fined $20,000 for their breaches.

The trucks were fitted with GPS trackers, but the work/rest hours breaches were not detected or acted upon by the company.

Issues considered during the hearing included:

  • the business failed to properly identify the risk of fatigue breaches arising from long-distance driving
  • the business failed to put in place measures to prevent fatigued driving, such as scheduling journeys and rostering drivers to ensure that mandatory rest could be taken within and between journeys and putting in place training and direction in relation to fatigue management and the business’ policies and expectations
  • the business failed to implement assurance mechanisms to ensure that its transport activities were being conducted safely, including monitoring the GPS records for vehicles and reviewing them to proactively identify fatigue breaches and address them through performance management with drivers.

Second Enforceable Undertaking (EU) accepted under HVNL – September 2020  

In September 2020, the NHVR accepted the second EU under the HVNL, this time offered by national logistics company Qube Ports Pty Limited (Qube).

The regulators alleged that in 2019, Qube failed to comply with mass requirements under section 96 of the HVNL.

As an alternative to being prosecuted, Qube submitted an EU, under which it committed to spending a minimum of $137,000, including in relation to:

  • development of a Critical Risk Awareness video message campaign
  • unbranded companion video messages for use by the broader industry
  • an externally conducted mass management review of existing Qube processes.

In agreeing to accept the EU instead of prosecution, the NHVR noted that there was no available evidence to suggest that the alleged breach was part of a recurring failure to manage mass requirements or any systematic non-compliance with the HVNL. In such circumstances, the value of the EU was significantly in excess of any penalty that a court would be likely to impose and presented a better outcome from a regulatory perspective.

How to ‘win’ at CoR – September 2020 

In September 2020, we successfully ran a court case that demonstrated how a proactive approach to your safety obligations can protect you from prosecution.

The business in question operated heavy vehicles and employed the loader and driver of a truck that it owned. They were loading construction fill materials. Neither the truck nor loading equipment had scales. The truck was overloaded at 121 per cent. The maximum penalty was about $59,000 and the prosecutor was pressing the court for a mid-level penalty. The prosecutor would probably have obtained the result that it wanted, until the court was taken through the critical background to the incident.

The business had identified that it had obligations under the HVNL and had designed and implemented compliance policies and practices to meet those obligations. As part of those practices, the business had previously calculated load mass/density profiles for the bulk goods that it typically carried. Unfortunately, this product was contaminated with foreign material that was heavier than the load mass/density profile.

The business was an accredited TruckSafe operator and had gone through the rigorous compliance and safety induction audit to obtain accreditation.

As part of a general review and reassessment, the business conducted a boardroom briefing for the executive on the business’ and executive’s duties – so the executive was actively engaged in ensuring that the business was seeking to meet its HVNL obligations. The business then engaged us to conduct a HVNL compliance review and gap analysis, out of which a 58 point action plan was developed by the business (for clarity, this did not represent 58 items that were necessary for the business to implement to achieve a system that could ensure compliance with the law, but represented a number of things that the business could implement to enhance and further develop its existing system).

The business was part-way through ticking off and implementing those items when the above incident occurred. As part of that action plan, but after the incident, the business installed truck scales and rolled out refresher training on loading procedures and checks.

The Court was taken through these additional matters, to demonstrate the full extent of the business’ proactive, genuinely substantive and multilayered approach to HVNL compliance.

The judge commented that although the nature of the offence gave rise to serious safety risks, no actual harm arose. Further, having regard to the considerable focus and attention that the business has brought to bear on these areas, at considerable cost and commitment, both before and at the time of the incident and the considerable measures implemented by the business as a result, he was satisfied that the risk of such an offence occurring in future was low. In those circumstances, where the business was and continued to do the right thing, it would not be appropriate to impose a penalty or record a conviction against the company.

Did the business get off scot-free? Absolutely not! The business invested significant commitment, time and money in HVNL safety – and it paid off.

Primary duty charges arising from fatality – November 2020 

Media reports indicate that Birrell Heavy Tilt & Transport and its director, Gregg Birrell, were prosecuted for breach of the primary safety duty and Executive duty, respectively. The charges arose out of a fatal incident at Clements Gap in South Australia in February 2019.

The NHVR alleges that the business was the operator of a heavy vehicle engaged in towing and breached the primary safety duty under the HVNL, resulting in a fatality. As at the time of writing, the case is awaiting a final hearing.

Author: Nathan Cecil

  • This article was originally published in CoR Adviser. The article is © 2020 Portner Press Publishing Pty Ltd and has been reproduced with permission of Portner Press.

The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.

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