Trucking Dangerous Goods: Who’s Liable in Case of Accidents?

Trucking Dangerous Goods: Who’s Liable in Case of Accidents?
Posted: Nov 28, 2013 12:36 PM | Last Updated: Nov 28, 2013 12:39 PM

TORONTO— The Canadian Trucking Alliance is asking the federal government to invalidate contract clauses compensating shippers from liability in case of incidents involving dangerous goods such as crude oil.

CTA’s president and CEO, David Bradley, commented: “We strongly believe the most effective thing governments can do is to take the recommended actions to reduce the risk of highway accidents and to make sure that the parties whose negligence causes an accident are held liable for the claims.”

The growing trend of shippers including clauses in freight contracts that compensate them from liability from their own negligence goes against both public interest and policy, the CTA says.

The discussion comes in light of last summer’s Lac Megantic accident when several rail tank cars carrying crude oil derailed.

After that incident, the federal government wrote some big clean up cheques and called for increased insurance coverage for rail carriers and shippers.

But an incident of the magnitude of Lac Megantic is unlikely to occur with trucks, the CTA says.

In a report stating its position on the transportation of dangerous goods by truck, the CTA found that the frequency and severity of highway incidents involving trucks carrying dangerous goods is extremely low.

The report analyzed 328 dangerous goods incidents involving trucks in 2012 and found that the number of incidents was 1.64 every 10,000 shipments, with a majority (56.4 percent) of the releases of product under 500 litres, or in other words, minor. These incidents are usually cleaned up with little or no environmental damage.

Highway accidents, where the public is most at risk, accounted for 16.2 percent of all incidents, which means they happened as often as 0.27 times every 10,000 shipments.

Despite their rarity, the major accidents, which account for 6.4 percent of all incidents, are the main cause (56.8 percent) of releases of product larger than 5,000 litres.

“I think we can conclude from this white paper that overall the TDG regulations are effective in preventing dangerous goods incidents where trucks are involved,” Bradley said.

Even so, the CTA advisory committee on dangerous goods has been struck to look at the regulations in more detail. 

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Growth in “goods” sector of economy strengthening truck freight

Analysts with FTR Associates took great pains to delineate the difference between GDP and truck freight growth in the current economic recovery during the transportation-forecasting firm?s latest Freight Focus webinar held yesterday.  Noel Perry, senior consultant at FTR Associates and principal of Transport Fundamentals, pointed out that while certain ?structural reasons? explain why the economic recovery overall will be slow, the ?strength of the goods side of the economy has [already] made this a strong freight recovery.?

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Perry said the ?slow recovery on now is expected by most economists to continue.? He explained that GDP growth ?accelerated rapidly? but then slowed over the last three quarters?staying below 3% growth. A key reason that growth slowed is because consumption (of goods and services) has been weak so far compared to earlier recessions.

He then explained there are three structural ?drags? on the economy right now: tight credit, a slow-to-recover housing market (which accounts for a whopping 15% of the economy) and unemployment.

On the other hand, Perry stated that ?the number of jobs is not the only arbiter? of growth. ?We can see the evidence of rising incomes in spending on consumer durables, he pointed out, adding that the U.S. economy is also getting a boost from economic growth overseas, especially in China and other economically emerging nations especially Brazil Russia and India.

?But the best news is the prospects for capital spending by business [here],? he continued. Yet already, Perry pointed out, ?The strength of the goods side of the economy has made this a strong freight recovery.? Backing this up, an FTR chart laying out the average quarterly GDP growth in the recovery through 2010?s Q3 showed that while GDP growth was just below 3%, truck tonnage hit 7%.

As the recovery continues, Perry expects GDP growth to be aligned with earlier recoveries (specifically 1983-4 and 2002-03) in that it will come back slowly. ?It is perfectly normal to have a slow quarter [GDP below 3%] or two during the first two years of recovery,? he stressed.

Turning specifically to trucking, Perry said its recovery will be hampered not by freight levels, but by ?conservative capacity additions? [of equipment and drivers by fleets and the impact of several new] federal regulations.?

Per another FTR chart, Perry detailed  ?truck loadings growth? from 2011 Q1 through Q3 as being essentially just shy of 5% with that target being hit straight on in Q4. ?This growth is more than enough to create a tight truck [capacity] market in 2011 and 2012,? he observed

And because Perry sees ?trucking management as having big scars? from what they have been through in this downturn, he expects that a ?conservative? approach to adding equipment will continue. But the biggest issue facing fleets going into 2011 and well beyond will be ?the constricted pipeline for driver supply? now in place. He explained that in the downturn many fleets disassembled their driver-recruitment infrastructure and must now scramble to get people in place to process driver paperwork and to train drivers.

On top of that, Perry pointed out, there is the negative impact new federal safety regulations from CSA to further hours-of-service reform will have on the existing and prospective driver labor pool to keep in mind.

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