Parties wrestle with transportation issues in court

The Canadian Transportation Agency seems to be becoming a brief stopover on the way to court.

The agency is responsible for dealing with disputes between transportation companies and also makes regulatory decisions. Lately, out of seven CTA decisions being appealed to the Federal Court of Appeal, five involve grain transportation.

On May 11, the court is scheduled to hear an appeal by Canadian National Railway against a February 2009 decision that the exchange of rail cars between CN and Burlington Northern Santa Fe Railway near Winnipeg should continue to be governed by regulated rates.

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On April 19, the court is expected to hear arguments on an appeal by the Canadian Wheat Board contesting a CTA decision that rejected a CWB complaint about inadequate rail service in 2007-08.
Also on April 19, CN is appealing an agency ruling that the railway failed to meet its obligations to western grain shippers in 2006-07.
On Feb. 18, two similar cases involving net salvage value of rail lines were heard. The town of Bengough, Sask., and the Rural Municipality of Souris Valley are each challenging the CTA’s calculation of the net salvage value of rail lines local shipper groups want to buy from Canadian Pacific Railway.

A sixth case recently ended when the court handed down a decision on an appeal by CN against the CTA contesting how the grain revenue caps for 2007-08 were set. The court allowed part of the appeal but dismissed the majority of it.

CTA spokesperson Marc Comeau said new regulations have been introduced in recent years, and carriers and shippers may be testing their limits.

“All I can say is that obviously whenever the agency makes a decision we feel it’s the right one based on the facts we had,” he added.

CWB spokesperson Maureen Fitzhenry said significant money is at stake, so organizations and companies may have no choice but to appeal.

As well, the outcome may set a precedent for years to come.

“It’s worth being really, really sure that all the relevant facts were considered,” she said.

Officials with two Saskatchewan groups appealing the CTA’s decision on net salvage value said the agency failed to take two significant factors into account in calculating the value of the lines they want to buy, which resulted in an over valuation of more than $1 million.

Ian McCreary, a farmer and former CWB director with expertise in grain transportation, said that by making the process lengthy and costly, the railways may be hoping to dissuade potential litigants from pursuing cases.

The railways may also be staking out territory in certain areas related to the federal government’s ongoing freight service review,” he said.