Ontario, Quebec truckers withdraw services from Ivaco

TORONTO, (March 18, 2004) — Several carriers from Ontario and Quebec have joined forces against one of their own customers — a move the Ontario Trucking Association says may be precedent-setting for the Canadian trucking industry.

In what is described as a desperate move to recoup some of the millions of dollars owed to them by Quebec-based Ivaco, a group of carriers have withdrawn their services from the steel producer — which was granted protection from creditors by the courts last fall. The carriers’ trucks simply failed to show up earlier this week for their usual pick-ups and deliveries.

While he assumed the collective action was the first of its kind, OTA president David Bradley predicted it wouldn’t be the last. “More and more big companies are resorting to protection under the Companies Creditors Arrangement Act, so that it appears to have almost become a way of doing business. The secured creditors will at least get some of the monies that are owed to them, but the trucking companies will likely get nothing in the end, except the hope that they might have the privilege of serving the company when and if it emerges from protection or is sold,” he said in a press release.

“In the meantime, they are expected to continue to haul freight for the company. Their balance sheets have been greatly impacted and in many cases their own creditors are breathing down their necks. They believe it’s not fair and they are fighting back.”

The carriers hope the company will try and settle by paying them for freight services before the company filed for protection. It’s possible Ivaco might go to court to seek an injunction against the carriers forcing them to provide service during the re-organization, or the company will fish for other carriers to handle their freight.

But Bradley said pitting carriers against each other is not a practice easily executed these days. “There is no excess capacity in the trucking industry now, so I would doubt that it will be easy to find someone else to haul the freight,” he said.