Four grain shippers have won a complaint against Canadian National Railway over service provided by the railways in 2007-08.
As a result of the Sept. 25 ruling by the Canadian Transportation Agency, the railway will for the first time be required to meet specific performance benchmarks.
Shippers involved in the case say the benchmarks are a positive step and will serve as a valuable precedent in future disputes over rail service.
“It reflects the CTA’s determination of an appropriate way to measure performance in level of service cases,” said Ward Weisensel, chief operating officer of the Canadian Wheat Board.
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“So yes, we see it as a precedent.”
The railway disagrees.
CN spokesperson Kelli Svendsen said the CTA’s decision and the benchmarks relate to only the four companies that won the complaint.
“This is a specific ruling looking at these four small shippers,” she said, noting that in the same decision the agency dismissed similar complaints by two other shippers.
In a news release, the CTA said the performance benchmarks apply only to the four named shippers.
CTA spokesperson Marc Comeau said the agency has no authority to issue a blanket order that would apply to the entire industry.
But he added the agency does take its previous decisions into account when it looks at new cases dealing with similar issues.
“Every case is a precedent in the sense that it goes into the jurisprudence of all the decisions we’ve issued on level of service, so it’s something we would look at in any future service complaint,” said Comeau.
In the decision, the CTA ruled that CN failed to provide adequate service in the 2007-08 crop year to North East Terminal, North West Terminal, Paterson Grain and Parrish and Heimbecker.
The agency rejected similar complaints from two other shippers: Providence Grain Group and the Canadian Wheat Board.
In its 25 page decision, the CTA laid out performance benchmarks that CN must meet:
- The railway must confirm a minimum of 80 percent of cars requested by grain shippers.
- Deliver 90 percent of those confirmed cars no later than two weeks beyond the agreed delivery date.
- Meet those standards on a 12-week rolling average throughout the crop years. The railway must also deliver all confirmed cars not covered by the first two points.
Perry Pellerin, who represents small shippers on transportation issues, said the new performance targets could help small shippers stay in business.
He said CN’s “continuous unilateral changes” to grain shipping programs have favoured large grain companies at the expense of smaller shippers.
In its decision, the CTA also urged shippers and the railway to begin discussions aimed at establishing mutually agreeable performance and offered to facilitate talks.
Shippers say even though the benchmarks don’t require 100 percent compliance, they are positive.
“The key point is we didn’t have benchmarks yesterday and today we do,” said Weisensel.
However, he added the CWB was disappointed that the CTA rejected its complaint. He said the transportation agency failed to account for data from February and March, a period which coincided with the worst rail service.
He said the board is considering launching an appeal.
Svendsen would not say if CN would appeal, saying the railway is considering its options. As for the agency’s suggestion that shippers and CN engage in discussions aimed at establishing industry-wide performance standards, shippers’ representatives welcomed the idea, while the railway was less enthusiastic.
“It’s difficult to understand exactly what that means because we are in continuous dialogue with customers,” said Svendsen.
The complete decision can be viewed on the CTA’s website www.cta-otc.gc.ca by looking under “Topics of Interest.”
