Insights

In brief - HVNL amendments include broadening of due diligence obligations on executive officers

In February 2018, the Heavy Vehicle National Law and Other Legislation Amendment Bill 2018 (Bill) was introduced into the Queensland Parliament by the Minister for Transport and Main Roads. The Bill is part of the three-phased approach to reforms surrounding the concept of "chain of responsibility" for drivers and off-road parties in the transport and logistics industry. The amendments will likely impact other states that adopt or duplicate the heavy vehicle national law.
 
This update provides: 
 
  • a refresher of the obligations on parties, and executives, in the transport and logistics chain of responsibility (CoR); and 
  • a summary of the proposed amendments in the Bill, specifically focusing on the proposed broadening of duties on executive officers.

Obligations and duties under the Heavy Vehicle National Law - Are you in the chain of responsibility?

The Heavy Vehicle National Law Act 2012 (HVNL) came into effect in 2014, with the underlying goal of providing a single national law for the consistent regulation of heavy vehicle operations across Australia (phase one of the reforms). 
 
Currently, every state in Australia (excluding Western Australia and the Northern Territory) has passed legislation adopting (or duplicating) the HVNL as their own heavy vehicle law. 
 
On 9 December 2016, the Heavy Vehicle National Law and Other Legislation Amendment Act 2016 received assent (Amendment Act) but is otherwise awaiting a date of proclamation to be fixed. 
 
The Amendment Act reformulated existing obligations on all current CoR parties as a positive due diligence obligation to ensure that they comply with their primary duty. The primary duty owed is contained under section 26C (to be inserted under new Chapter 1A) of the HVNL and states that:
 
Each party in the chain of responsibility for a heavy vehicle must ensure, so far as is reasonably practicable, the safety of the party’s transport activities relating to the vehicle. 
 
The characterisation of this duty will also see the HVNL adopt the same standard of care consistent with workplace health and safety laws, being the standard of "so far as is reasonably practicable" (not "reasonable steps").
 
The primary duty places obligations on each party in the CoR to, for example: 
 
  • eliminate or minimise public risks; and
  • ensure that their conduct does not directly or indirectly cause or encourage the driver of a heavy vehicle to exceed a speed limit applying to the driver.
The Amendment Act casts a wide net to capture a number of parties in the CoR, including: 
 
  • an employer of the driver (if the vehicle’s driver is an employed driver)
  • a prime contractor for the driver (if the vehicle’s driver is a self-employed driver)
  • an operator of the vehicle
  • a consignor/consignee of any goods in the vehicle
  • a packer of any goods in the vehicle
  • a loading manager for or loader of any goods in the vehicle
  • an unloader of any goods in the vehicle.
The safety of transport and logistics activities is a shared responsibility by all parties in the CoR. 
 
Critically, section 26D imposes a due diligence obligation on executive officers to ensure that the legal entity complies with its primary duty under section 27C. In circumstances where an executive officer breaches his or her due diligence duty, they may be faced with either significant civil penalties or worse yet, criminal conviction, even if the legal entity has not been proceeded against for, or convicted of, an offence relating to the primary duty. 
 
Again, these provisions are awaiting a date of proclamation. 

Amendment Bill to broaden positive due diligence duty on executives

The second phase of the reforms is the subject of the Bill, and proposes a number of amendments, from increased penalties under the Transport Operations (Road Use Management) Act 1995, to the extension of positive due diligence requirements. This update focuses on the latter. 
 
The Bill proposes amendments to section 26D to broaden the scope of the due diligence duty on executives, to include a definition of "safety duty". The proposed definition of "safety duty" will encapsulate the existing primary duties under section 26C (for which an executive officer has a due diligence obligation), as well as other major safety duties imposed under other sections of the HVNL (for example, obligations relating to registration requirements of vehicles and requirements not to tamper with approved electronic recording systems). 

Due diligence requirements 

Section 26D(3) of the Amendment Act lists a number of steps that are considered as "reasonable" for an executive officer to take, and include: 
 
  • acquiring, and keeping up to date, knowledge about the safe conduct of transport activities;
  • gaining an understanding of the nature of the legal entity's transport activities and the associated hazards and risks; and 
  • ensuring that the legal entity has and uses appropriate resources to eliminate or minimise hazards and risks.
These "reasonable" due diligence steps are proposed to be relocated to the new definition of "safety duty" under section 3 of the HVNL. 

Phase three HVNL reforms on the horizon 

In introducing the Bill, the Minister has foreshadowed further amendments to be introduced later this year, addressing investigative and enforcement powers which are the subject of the National Transport Commission review

Executive officers should be aware of HVNL amendments 

The Bill provides a timely reminder for all transport and logistics companies to understand their obligations under the Amendment Act so that their executive officers are aware of their statutory duties, once those duties come into effect. 
 
Keeping up to date on the developments in each state will be critical as changes in Queensland, for example, are likely to impact those other states that adopt or duplicate the same HVNL laws by way of national framework.
 
Additionally, the proposed amendments in the Bill should be one of primary attention, as they show the proposed broadening of obligations which may expose executive officers to further circumstances where civil and criminal consequences may flow from any breach. 
 
 
Stephen Thompson wrote on this topic in September 2017 in the article What Do Amendments To Chain Of Responsibility Legislation Mean For Supply Chain Participants?

This article has been published by Colin Biggers & Paisley for information and education purposes only and is a general summary of the topic(s) presented. This article is not specific legal advice. Please seek your own legal advice for any questions you may have. All information contained in this article is subject to change. Colin Biggers & Paisley cannot be held responsible for any liability whatsoever, or for any loss howsoever arising from any reliance upon the contents of this article.​

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