The Legal Matrix for BC Highway Carriers
-
Upload
jan-whyte-btech-mciarb -
Category
Documents
-
view
20 -
download
0
Transcript of The Legal Matrix for BC Highway Carriers
Word Count: 2000
Analyzing Risk for Small Business: The Impact of Canada’s
Regulatory Matrix on Inter-Provincial Trucking Owner/Operators
Jan Whyte
Thompson Rivers University OLU
Introduction
Citizens in Canada have long relied upon the trucking industry for delivery of necessities of life. In
the last ten years, this industry has received a boost from on-line consumer shopping’s home
delivery of items ranging from mascara to refrigerators. Paradoxically, the number of truck drivers
available for hire is on the decline and there are fewer owner/operators able to afford to do business
in BC.
This paper analyzes whether or not Canada’s regulations governing the inter-provincial
highway carrier industry are creating risks of loss for the small trucking business owner/operators.
The Small Business Trucking Industry
The writer’s professional experiences and education regarding truck drivers and small trucking
business owner/operators in BC (the “BC Trucker”) have informed the following economic and legal
facts:
a) BC Truckers have a low operating profit – 5 – 10%;
b) BC Truckers frequently contract for hauls from the West Coast of Canada to
Ontario and Nova Scotia (port-to-port) – a distance spanning 9300km;
2
c) BC Truckers enter various municipal, provincial, territorial and international
jurisdictions;
d) Some inter-provincial trucking activities are governed by Federal
legislation, while other activities governed by Provincial by-laws,
regulations and legislation (Constitution Acts 1967-1982);
e) The Criminal Code of Canada contains provision which specifically apply to
the commercial trucking industry (dangerous goods, legal duty of care)
(Criminal Code of Canada 1985);
f) BC Truckers frequently contract for hauls crossing the US/Canada Border,
which expose the BC Trucker to over 90 acts and regulations within the
jurisdiction of the Canada Customs and Border Services Agency; and
g) The BC Trucker has a duty to make him/herself aware of the laws, and is obligated
to comply with the laws.
The Regulatory Matrix
In the mid-1980’s, the Canadian trucking industry moved from a government-controlled industry to
a free competition model. This movement was called “de-regulation” and the new economic model
was called “perfect competition”. As a result of de-regulation, policy regulation to control safety in
the industry was introduced through creation of new laws and regulations. (Monteiro, 2014)
Mr. Justice Cory, on behalf of the Supreme Court of Canada R. v. Wholesale Travel
(Supreme Court of Canada 1991), states that the number of pieces of legislation the BC Trucker is
expected to locate, understand and comply with had increased from 20,000 federal offences in 1974
to 97,000 in 1983. The 2010 report from The Law Commission of Ontario confirmed the
increased monetary consequences of regulatory offences in Canada included “substantial terms
of imprisonment and … fines in the millions of dollars”. (Libman 2010)
3
Margaret Hogg and Robert Jones in their article Industry Regulations: Too Many or Too
Little (The Face 2015) explain two phenomena which are occurring in 2015 in the Canadian
trucking industry:
1. Truckers do not understand the laws; and
2. Hours of Service (HOS) Regulations are causing disrupting of business efficiency.
Jones stated “People complain about “too many regulations”, but I think it’s because they
really don’t understand them”. Jones’ view is supported by the paper Collision between Federal
and Provincial Occupational Health and Safety Regimes (Dunn, Hohman and Sidnell 2013)
which describes the conflict of laws between federal and provincial jurisdictions in Canada as
“collisions” of the laws and resulting confusion as to which circumstances in each jurisdiction
are relevant to the offences. Lessons Learned Impacts Size Articulated (Reger, Montufar and
Clayton 2009) brings us a case-specific example of a regulation that did not fit well with the
trucking industry. The authors describe the regulation for carriers which did not allow for various
types of equipment with differing dimensions and weights when drafting the specific tolerances
that would be within the law of that regulation, and how that policy drafting oversight caused
consequences of economic loss and confusion to the trucking businesses and industry.
Other professional associations in Canada sought legal clarification in province-by-
province styles of regulation. In Regulating Professions in Canada: Inter-Provincial Differences
(Adams 2009) the author states the problem in Canada is “the ways in which professional
regulation varies is not well understood”. The solution set out in this article is to gain greater
knowledge of professional regulation and its variations across time and place, which will
enriched our understanding of the requirements of the profession.
4
Returning back to The Face article (supra) item #2, Margaret Hogg states that she
believes the problem plaguing truckers’ profits is the regulation called “Hours of Service” or
“HOS”. The mandated hours of driving cause occasions when the trucker must mandatorily
park his rig and rest/refrain from driving once he has been on the road for a certain length of
time. This restriction causes lost profits due to idle resources (driver, truck). The idle time
manifests into less loads per month, missed opportunity for early delivery bonuses, penalties for
late delivery and extra down time should US/Canada border crossing schedules be missed due to
the mandatory shut-down regulation. The unfortunate result is that, in the BC Trucker’s
perspective, absent a reason that compliance is of more importance than serving his customers
and staying in business, the trucker may take the risk of breaching the regulation. By making the
choice to disregard the law, the trucker risks economic loss from being caught and fined with a
by-law ticket or, in the most serious consequences, incarcerated due to a breach of his legal duty
of care to others on the highway.
The trucking transportation industry is not the only transportation mode to feel the heavy
hand of mandatory safety regulation in Canada. A railway transportation example is set out in the
article on Lac Megantic railway disaster which destroyed a small town says it is a lack of
regulation in that industry that is demanding a change to the laws – a reform which is costing
railway operators and their customers billions of dollars in increased insurance and safety
regulation training. (Campbell 2013)
There was a different approach in the environmental regulatory environment when new
laws were implemented. We are informed by “Integrading Compliance and Regulatory Design in
EPA Rulemaking” that public disclosure processes during the regulatory drafting was very
5
effective, as it both considered stakeholder interests in the cause as well as accomplished their
buy-in to the regulatory process (Roberts 2014).
Regardless the topic of regulation, it is reported that the regulatory compliance level in
small firms is much lower than larger entities. For example the Law Society of British Columbia
- which has an internal professional governance system - reported that the compliance rate of
small firms was far below that of larger firms, thus pointing out a need for targeted and formal
education in the small business sector of industries. (Woolley 2012)
When regulation is indeed necessary, what factors lead to successful adoption and
compliance? Energy Sector MESS sets out how four energy sector imperatives have been
included in energy policymaking. They are described to have been layered over time, giving the
stakeholders a chance to comply and adjust. (2012, Gattinger)
Finally, and because we have truckers as individuals to consider in the fairness of the
regulations, we turned to the article Ambivalence which confirms that a regulation may consider
the vulnerability and certain specific provisions for a certain class of stakeholder. Regulatory
wording need not be a one-size fits all approach. (Drummon and Cohen 2014)
Analysis
Our hypothesis is that the nature of the highway carrier business in Canada and its current
regulatory framework creates risk of loss in profits and liberty for the BC Trucker.
Issue 1: Understanding Legally Required Conduct
The full set of Canada’s laws, some of which the BC Trucker must consider in
commercial activities, may be found on the Canadian public laws site CANLII. CANLII informs
6
us that Canada has a total of 35,499 individual pieces of Federal and provincial legislation
(statutes, regulations) (2015, CANLII).
Federal statutes and regulations in Canada total 4,888. In addition, there are thousands of
pieces of provincial legislation - see Figure 1.
Figure 1: CANLII Legislation Search
The internet, the most easily and economically accessed source of information, hosts the
platform for the Province of British Columbia’s site “Minister of Transport and Infrastructure’s
Mandate” (Province of British Columbia 2015). Despite its appearance of thoroughness - 21 acts
listed - this site would cause problems for the BC Trucker should he/she rely upon it as the only
information for full legal compliance. Some legislation is missing. For example, transportation
offences under the Criminal Code of Canada, (supra) and the provincial Offences Act (1996). In
addition, the site does not reference complementary regulations to the acts, which in some cases
BC AB SK MB ON PQ NB NS PEI NFD YKNW
TNUN
Series1 2262 2224 2228 2476 2965 6706 1446 2111 913 2487 1975 990 778
0
1000
2000
3000
4000
5000
6000
7000
# ST
ATU
TES/
REG
S
PROVINCE
Volume of Legislation in Canada
7
(such as the British Columbia Motor Vehicle Act (1996)), the content of the regulation is more
relevant to required conduct than the act itself.
We then viewed the December 31, 2014 Cumulative BC Regulations Bulletin on the
official internet site for proclaiming the laws of Canada – the Canadian Gazette (the Gazette).
There was no layman’s interpretation of the contents of the bulletin. As a result the relevant
knowledge would not be easily understood unless the reader had some legal training. (2014
Canadian Gazette)
Finally, BC Provincial site “BizPal” – a federal platform that has been rolled out to
provinces and municipalities for citizens’ use in uploading their laws – provided information that
a BC Trucker doing business in Vancouver may need 42 permits and licenses - 14 Municipal, 16
Provincial or Territorial and 12 Federal. This was helpful for BC business, but did not contain
information for all provinces and municipalities in Canada. (2015 Bizpal)
Issue #2 – Identifying Legal Risks
An analysis of the BC Trucker’s business activities was undertaken, based on facts set
out in the text Transportation Systems, a Canadian Perspective (CITT 2011) and the information
on regulatory offences contained in Criminal Law in Canada (Verdun-Jones 2015).
The activities a BC Trucker undertakes in his unique business as a highway carrier in
Canada expose him to significant risks in the following “true crimes” categories:
1. Pollution/Environmental Protection - failure to perform legal duty of care to other
users of highways to ensure the truck is in safe working order and that dangerous
contents being hauled are safely marked, stored, secured;
2. Driving - Criminal Negligence - failure to perform legal duty of care to ensure driver
is suitable condition to drive (hours of service restrictions); and
8
3. Assault, Manslaughter, Sexual Assault - offences related to personal conduct while
engaging in activities involving food/drink (bar environment), exercise (casual
recreational sports) and sex (under age, unknown history, confined private sleeping
compartment) as a result of stopping in unfamiliar towns when budged driving time
expires.
Figure 2 sets out a framework for the BC Trucker’s legal risks from low (by-law) to high
(true crimes), a failure to manage which will result in loss of income, capital assets and, potentially,
his business.
Figure 2: Sample Trucking Business-Legal Risk Framework
By-Law
By-Law Infractions -no defence
(absolute liability)
Permit for Travel -Mistake of Law -Officially Induced Error (failure to
Speeding - no defence (absolute
liability)
Quasi-Criminal
Failure to Display Placard (TSA) - due
diligence
CBSA (Various) -AMPS - due
diligence, absolute liability
Breaches of the Environmental
Protection Act - due diligence
True Crime
Assault, Sex Assault - ensure consent and proof of age
inquiries (provable)
Manslaughter - thin skull, use of other body parts in bar
brawls; provocation
Criminal Negligence Causing Death -
know safety rules and legal duties of
care
9
Conclusion
The hypothesis was proven. The laws governing highway carriers in Canada are voluminous and
difficult to interpret. Many users are ignorant of their legal duties. The consequences to the
owner/operator, as in the case of the Hours of Service regulation, are severe. The pressure of
economic loss provokes the driver to make a choice to breach the regulation, which expose the
highest risks of all - severe penal consequences including fines and incarceration plus
compromise of the safety of other highway users.
Absent a process to deliver the complete set of relevant laws and a process to effectively
educating the unique profile of the owner/operator, the drivers will continue to offend. As a
result the public will not be protected as was intended in the Parliamentary proclamation of the
regulations.
In summary, the survival of the small business and owner/operator sector and
maintenance of many-member perfect competition as was contemplated by the 1980’s de-
regulation (as opposed to few member dominance in oligopoly which would result from an
eclipse of the small business and owner/operator truckers), depends upon regulatory reform and
effective legal education in the trucking industry.
The onus is on Government in Canada to make an efficient circuit board out of the
complex regulatory matrix it has created.
10
References
Adams, T. L. (2009). Regulating Professions in Canada: Interprovincial Differences across Five
Provinces. Journal Of Canadian Studies, 43(3), 194-221.
Anand, A. I. (2010). IS SYSTEMIC RISK RELEVANT TO SECURITIES
REGULATION?. University Of Toronto Law Journal, 60(4), 941-981.
Andrée, P. (2006). An analysis of efforts to improve genetically modified food regulation in
Canada. Science & Public Policy (SPP), 33(5), 377-389.
Baron, J. R. (2013). How regulating risk and eschewing competition can ameliorate a global
financial crisis: Canada's perspectives and experiences. Antitrust Bulletin, 58(4), 597-615.
Campbell, B. (2013). Lac-Mégantic disaster result of corporate and gov't neglect. CCPA
Monitor, 20(5), 26-28.
Chesnay, C. T., Bellot, C., & Sylvestre, M. (2013). Taming Disorderly People One Ticket at a
Time: The Penalization of Homelessness in Ontario and British Columbia1. Canadian
Journal Of Criminology & Criminal Justice, 55(2), 161-185.
Clark, L. (2008). Canada's Oversight of Arctic Shipping: The Need for Reform. Tulane Maritime
Law Journal, 33(1), 79-110.
Corsi, T. M., & Stowers, J. R. (1991). Effects of a Deregulated Environment on Motor Carriers:
A Systematic, Multi-Segment Analysis. Transportation Journal (American Society Of
Transportation & Logistics Inc), 30(3), 4-28.
Drummond, S. G., & Cohen, S. R. (2014). Eloquent (In) action: Enforcement and Prosecutorial
Restraint in the Transnational Trade in Human Eggs As Deep Ambivalence about the
Law. Canadian Journal Of Women & The Law, 26(2), 206-240. doi:10.3138/cjwl.26.2.02
Dunn, L. Hohman, S., & Sidnell, E. J. (2013). The Collision Between Federal and Provincial
Occupational Health and Safety Regimes on Energy and Resource Projects. Alberta Law
Review, 51(2), 313-342.
Gattinger, M. (2012). Canada–United States Energy Relations: Making a MESS of Energy
Policy. American Review Of Canadian Studies, 42(4), 460-473.
doi:10.1080/02722011.2012.732331
Guichon, J., Mitchell, I., & Doig, C. (2013). Assisted Human Reproduction in Common Law
Canada after the Supreme Court of Canada Reference: Moving beyond Regulation by
Colleges of Physicians and Surgeons. Canadian Journal Of Women & The Law, 25(2),
315-339. doi:10.3138/cjwl.25.2.315
11
Hunt, E. J., Kuhlmann, U., Sheppard, A., Qin, T., Barratt, B. P., Harrison, L., & ... Goolsby, J.
(2008). Review of invertebrate biological control agent regulation in Australia, New
Zealand, Canada and the USA: recommendations for a harmonized European
system. Journal Of Applied Entomology, 132(2), 89-123. doi:10.1111/j.1439-
0418.2007.01232.x
Janicsch, H. (2012). Regulation and the Challenge of Broadband Telecommunications: Back to
the Future?. Alberta Law Review, 49(4), 767-784.
Laeeque, H., Boon, H., Kachan, N., Cohen, J. C., & D'Cruz, J. (2006). The Canadian Natural
Health Products (NHP) regulations: industry perceptions and compliance factors. BMC
Health Services Research, 663-11. doi:10.1186/1472-6963-6-63
Lan, G. (2014). Foreign Direct Investment in the United States and Canada: Fractured
Neoliberalism and the Regulatory Imperative. Vanderbilt Journal Of Transnational
Law,47(5), 1261-1320.
Lexchin, J., & Mintzes, B. (2014). A compromise too far: A review of Canadian cases of direct-
to-consumer advertising regulation. International Journal Of Risk & Safety In
Medicine, 26(4), 213-225. doi:10.3233/JRS-140635
Lybecker, K. M., & Fowler, E. (2009). Compulsory Licensing in Canada and Thailand:
Comparing Regimes to Ensure Legitimate Use of the WTO Rules. Journal Of Law,
Medicine & Ethics, 37(2), 222-239. doi:10.1111/j.1748-720X.2009.00367.x
Marcoux, J., & Létourneau, L. (2013). A distorted regulatory landscape: Genetically modified
wheat and the influence of non-safety issues in Canada. Science & Public Policy
(SPP), 40(4), 514-528.
Matthews, R. (2014). Committing Canadian Sociology: Developing a Canadian Sociology and a
Sociology of Canada. Canadian Review Of Sociology, 51(2), 107-127.
doi:10.1111/cars.12038
Maister, D. H. (1978). Regulation and the Level of Trucking Rates in Canada: Additional
Evidence. Transportation Journal (American Society Of Transportation & Logistics
Inc), 18(2), 49-62.
Miller, E. (1973). Effects of Regulation on Truck Utilization. Transportation Journal (American
Society Of Transportation & Logistics Inc), 13(1), 5-14.
Montiero, J. (2011). Trucking Transportation in Canada Before and After Deregulation – Major
Trends
http://www.ctrf.ca/conferences/2011Gatineau/2011Proceedings/6MonteiroTruckingTrans
portationCanada.pdf
12
Leclerc, W. (1980). Competition in Canadian Freight Transportation: A General
Survey. Transportation Journal (American Society Of Transportation & Logistics
Inc), 19(3), 69-75.
Phillips, S. (2012). Canadian Leapfrog: From Regulating Charitable Fundraising to Co-
Regulating Good Governance. Voluntas: International Journal Of Voluntary & Nonprofit
Organizations, 23(3), 808-829. doi:10.1007/s11266-011-9237-x
Regehr, J. D., Montufar, J., & Clayton, A. (2009). Lessons learned about the impacts of size and
weight regulations on the articulated truck fleet in the Canadian prairie region. Canadian
Journal Of Civil Engineering, 36(4), 607-616. doi:10.1139/L09-011
Roberts, Martha G., (2014). Integrading Compliance and Regulatory Design in EPA
Rulemaking. New York University Environmental Protection New York University
Environmental Law Journal 20 N.Y.U. Envtl. L.J. 545
Sands, C. (2012). America and the Canadian Presence: As the United States Faces Global
Challenges, How Does Canada Fit In?. American Review Of Canadian Studies, 42(4), 482-
488. doi:10.1080/02722011.2012.732333
Smyth, S., & McHughen, A. (2008). Regulating innovative crop technologies in Canada: the
case of regulating genetically modified crops. Plant Biotechnology Journal, 6(3), 213-225.
doi:10.1111/j.1467-7652.2007.00309.x
Van Wagner, E. Equal Choice, Equal Benefit: Gendered Disability and the Regulation of
Assisted Human Reproduction in Canada. Canadian Journal of Women & the Law. 20, 2,
231-261, Dec. 2008. ISSN: 08328781.
Walby, K., & Lippert, R. (2012). Spatial Regulation, Dispersal, and the Aesthetics of the City:
Conservation Officer Policing of Homeless People in Ottawa, Canada1. Antipode, 44(3),
1015-1033. doi:10.1111/j.1467-8330.2011.00923.x
Wiktorowicz, M. E. (2003). Emergent Patterns in the Regulation of Pharmaceuticals: Institutions
and Interests in the United States, Canada, Britain, and France. Journal Of Health Politics,
Policy & Law, 28(4), 615.
Woolley, A. (2012). Regulation in Practice: The 'Ethical Economy' of Lawyer Regulation in
Canada and a Case Study in Lawyer Deviance. Legal Ethics, 15(2), 243-275.
doi:10.5235/LE.15.2.243
13
Authorities, Statutes & Regulations
Constitution Acts 1867-1982. (1985). Revised Statutes of Canada. Part I.
Constitution Acts 1867-1982. (1985). Revised Statutes of Canada.. ss. 91, 92.
Criminal Code of Canada. (1985). Revised Statutes of Canada. c. C-46.
Motor Vehicle Act. (1996). Revised Statutes of British Columbia. c. 318.
Offence Act. (1996). Revised Statutes of British Columbia. c. 338.
R. v. Wholesale Travel Group. (1991). 3 S.C.R. 154.
Online Publications and Websites
Government of Canada (2003). "Small Business and Regulatory Bulletin." Retrieved January 10,
2015 from http://www.qp.gov.bc.ca/statreg/bulletin/bull2003/bull11.htm
Government of Canada (2015). "Bizpal." Retrieved January 10, 2015, from http://services.bizpal-
perle.ca/eng/step3/?b=01&j=Vancouver%2C+British+Columbia&sgc=5915022&s=Truck
+transportation&naics=484&p=.
Government of Canada (2015). Cumulative BC Regulations at December 31, 2014. Canadian
Gazette. Ottawa, ON, Government of Canada. Retrieved January 9, 2015 from
http://www.gazette.gc.ca/rp-pr/p1/2014/indexq4-eng.html
Law Reform Commission of Ontario (2010). "Sentencing Purposes and Principles for Provincial
Offences-A Modernization of the Provincial Offences Act." Tab 9. Retrieved January 9,
2015 from http://www.lco-cdo.org/POA-Final-Report.pdf
Province of British Columbia (2015). "Minister of Transport and Infrastructure's Mandate."
Retrieved January 10, 2015, from
http://www.th.gov.bc.ca/key_initiatives/legislation/statutes.htm#first.
Texts
CITT (2011). Transportation Systems – A Canadian Perspective. Toronto. Canadian Institute of
Traffic and Transportation.
Verdun-Jones, S. (2014). Criminal Law in Canada: Cases, Questions, and the Code. Toronto,
Nelson Education.