An Alberta terminal company has lost a service complaint against Canadian Pacific Railway.
The company said it doesn’t like the decision by the Canadian Transportation Agency but can’t afford to further pursue the case.
“I think we’ve pretty much decided it’s not worth an appeal at this point, mainly because we just don’t have the cash flow to fight the railway,” said Bruce Kinley, an owner of Central Alberta Transloading Terminals (CATT) Ltd. of Innisfail, Alta.
The company filed its complaint without a lawyer, but it would not be able to do so if it appealed to the Federal Court of Appeal.
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“If we went any further we’d have to retain legal counsel and then it becomes pretty costly,” Kinley said.
“Sometimes you’re better off just to take the loss.”
The company had asked the agency to order CPR to improve the frequency and predictability of its service and to declare demurrage penalties levied by the railway as unreasonable.
However, in a 12-page decision released last week, the CTA ruled in favour of the railway, saying it found no evidence that CPR breached its service obligations to CATT during the period covered by the complaint (May 2006 to September 2007).
Since the issue of unreasonable demurrage charges was based on the argument that CPR had breached its service obligations, the agency also rejected that part of the complaint.
Kinley said the decision surprised CATT.
“We really had a good feeling all the way through that we had a very legitimate case.”
He said the CTA over-simplified the case and didn’t look closely enough at the company’s business structure and operational issues as a transloader.
CATT transfers feed products arriving from the United States to trucks hauling those products to customers in Alberta.
That requires a predictable schedule of rail car arrival, something the company alleged was not happening.
Kinley said it can take six to 30 days for rail cars loaded with soy meal and corn to arrive from Minnesota and North Dakota.
If a product isn’t available when a customer needs it, the customer will get it somewhere else and CATT will lose the business. When the cars do arrive, CATT must deal with storage problems.
“We don’t feel the CTA looked at that part of the equation at all.”
Kinley doubted it would be possible to settle the company’s problems with CPR through direct discussions.
“We attempted to talk to CP to resolve these issues before we got this far, and that really gained us nothing.”
One positive move by the railway, he added, has been to introduce a new computer based system that enables companies such as CATT to keep track of demurrage charges on a daily basis and dispute them immediately if they disagree.
“Most of the time we’re winning those and as a result our demurrage bills are lower now,” he said.
Most of the $35,000 in demurrage that was the subject of the complaint was incurred before the new system was introduced.
Kinley doesn’t expect the CTA complaint to affect the company’s business relationship with CPR, noting most of the railway employees the company deals with are local people who understand the company’s concerns.
