Western Australian Industrial Relations Commission

Unconscionable conduct and rates of pay not 'safe and sustainable'

The Road Freight Transport Industry Tribunal has upheld in part, an owner-driver’s claim for breach of contract and unconscionable conduct.

The respondent terminated the owner-driver contract summarily without notice for breach. The reasons for the summary termination of the contract were disputed by the owner-driver and several issues were raised in response, including:

  • that the respondent failed to comply with its obligation under the contract to give notice to the owner-driver of its default and to give it an opportunity to remedy any alleged breaches of the contract;
  • that the owner-driver maintained it was not in breach of the contract by failing to comply with the respondent’s leave policy and that all leave taken or proposed to be taken was approved by the respondent; and
  • that the owner-driver, in not working Saturdays after the first two years of performance under the contract, did so with the knowledge of and acquiescence by the respondent and the respondent cannot now complain.

The owner-driver maintained the respondent engaged in unconscionable conduct in the way it allocated work to it and by the way the contract was terminated, which was said to involve deception by the respondent. Finally, the owner-driver claimed the rates paid by the respondent under the contract were not “safe and sustainable rates” for the purposes of the Owner-Drivers (Contracts and Disputes) Act 2007 (WA) and the Owner-Drivers (Contracts and Disputes) (Code of Conduct) Regulations 2010 (WA).

Senior Commissioner Kenner found that the negotiations for the contract between the owner-driver and the respondent were not unconscionable. However, he concluded that the failure to provide the owner-driver with a copy of the Guideline Rates published by the Road Freight Transport Industry Council, was unconscionable for the purposes of s 30(2)(g) of the OD Act.

Senior Commissioner Kenner was not satisfied on the evidence, that the respondent was able to rely on the owner-driver’s failure to work Saturdays, as a ground to find there was a breach of contract and to terminate it. The Senior Commissioner was satisfied that the owner-driver was in default of the contract by proceeding to take extended leave, contrary to the respondent’s revised policy. However, the respondent did not give notice to the owner-driver under the contract of the alleged default, and give it an opportunity to remedy it.

Senior Commissioner Kenner found the removal of the lifter was plainly a breach of the contract. The respondent took unfair advantage of the situation and removed the lifter in a deceptive way. Accordingly, the Senior Commissioner found such conduct to be unconscionable. As to the allocation of work and the distribution of runs, the Senior Commissioner was not satisfied the owner-driver made out its case in relation to unconscionable conduct.

Finally, Senior Commissioner Kenner found the rates of payment to the owner-driver under the contract were not safe and sustainable rates.

The parties were directed to confer as to the quantum of damages and any sum in respect of safe and sustainable rates.  

A copy of the decision can be found here.  

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