The two national railways will have to defend their performance hauling grain after all.
CN Rail and CP Rail had asked federal regulators to throw out the Canadian Wheat Board’s complaint about poor service this past winter, on technical and procedural grounds.
But in a May 16 ruling the Canadian Transportation Agency refused to derail the case and gave the railways until May 23 to file their formal reply to the wheat board’s charges.
Wheat board commissioners were not available for comment, but a CWB transportation policy specialist welcomed the ruling.
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“This vindicates the appropriateness of the cause of our action,” said Tami Reynolds. “The agency has ruled it’s a valid complaint.”
There was no immediate reaction from the railways.
“We have received it and are studying it and have no comment at this time,” said CN spokesperson Jim Feeny.
One of the railways’ arguments was that the CWB’s complaint was too broad and vague. But the agency said that’s no reason to stop the process.
“While there is no doubt that the CWB’s complaint is broadly based in that it calls into question the railways’ performance over a large geographic area and over a considerable period of time, the agency is satisfied that the allegations made by the CWB are specific enough to warrant an answer,” the agency said.
The board has asked the agency to order the railways to do a better job and to provide locomotives, cars and other equipment needed.
Court battle possible
The CWB has also said it could use a favorable ruling to go to court and seek millions of dollars in compensation from the railways for losses suffered by farmers as a result of this year’s grain transportation woes.
In their submissions to the agency the railways had argued, among other things:
- Grain movement to the U.S. is covered by a specific contract between the railways and the board, and the board should go to court and seek relief for breach of contract, not go to the CTA.
- For Canadian movement, any complaints should be dealt with by the Car Allocation Policy Group, which sets performance targets. Again, they say, a breach of CAPG rules should be taken to court, not the CTA.
- The wheat board complaint failed to provide enough details to allow the railways to respond properly. CP said the board did not describe “even one specific case” where it failed to carry grain as requested.
- The railways said the board should not be able to make a complaint about past performance, arguing the agency’s mandate is to deal with complaints about a presently occurring failure.
The CTA rejected every one of those arguments, summarily dismissing the argument that the agency can only deal with present, not past, problems.
It said there is no evidence that problems cited by the wheat board are not of an ongoing nature. And it said the railways’ position would mean the CTA could never rule on any case, because the facts of a level of service complaint will always be in the past.
