BLACK WOLF HAULERS INC. PLAINTIFF v. SHELLIE GINTER, 2003 SKPC 47

23/2002 2003 SKPC 47 IN THE PROVINCIAL COURT FOR SASKATCHEWAN AT SWIFT CURRENT, SASKATCHEWAN In the matter of a proceeding under The Small Claims Act 1997 BETWEEN: BLACK WOLF HAULERS INC. PLAINTIFF -and- SHELLIE GINTER (OPERATING UNDER THE FIRM NAME AND STYLE OF SMT TRUCKING OF SWIFT CURRENT, SK) DEFENDANT DECISION March 26, 2003 R.J. Conroy, PCJ [ 1 ] The plaintiff carries on the business of transporting recreational vehicles as well as general freight between points in Canada and to and from the United States of America.

It owns no truck or tractor-trailer units of its own and contracts with others to do the actual hauling. The defendant operates a general trucking business in the Swift Current area hauling hay and other merchandise. It owns and operates tractor and trailer units and contracts with various people to do hauling for them.

[ 2 ] The plaintiff is a family business operated by the husband and wife team of Lana and Will Getz. The defendant, Shelly Ginter, operates under the firm and style of SMT Trucking and is the primary owner of the business. Her fiancé, Michael Fisher, is general manager of that business. Some time in the summer of 2001, Mr. Fisher was looking for work for a tractor and trailer unit and contacted the plaintiff, Black Wolf Haulers Inc., and discussed their mutual needs by telephone.

After some further contact and an interview, the parties met October 26, 2001, to discuss their potential business arrangement, and signed a contract (filed as exhibit P1) on that date. The contract is a simple one page document setting out the primary obligations of the plaintiff to the defendant and of the defendant to the plaintiff, including the rates at which the defendant would be paid for the work being contracted. The contract also provides that both parties agreed to follow all of the policies and procedure set out in Black Wolf Haulers Inc.’s policy and procedure manual (July 2001).

The plaintiff indicates that orientation session, as it was called, lasted about four hours. Ms. Ginter’s recollection is of a two hour meeting, although Mr. Fisher says it may have been four hours. In any event, it is clear from the evidence that the policy and procedure manual was the subject of much of the discussion between the parties and that the explanation of it was one of the primary purposes of the meeting. Both Will and Lana Getz were present as were Ms. Ginter and Mr. Fisher.

At the end of the meeting, the parties signed the contract and it is clear from the evidence that there was work for the tractor-trailer unit to be provided by the defendants not later than the week of November 6, 2001.

There also is no doubt, from the written materials as well as the evidence, that it was the clear obligation of the defendant to provide not only the tractor and trailer, but the driver for it. [ 3 ] The evidence indicates that the defendant had been in contact with a potential driver by the name Charles Laramee, prior to the contract being signed, and in fact he attended from Alberta to Swift Current on October 31 and there was a further orientation meeting at that time. Mr. Laramee was expected to be at work by November 6, 2001. Unfortunately, on about the 5th or 6th of November, Mr.

Laramee telephoned to indicate that because of personal difficulties he was unable to fill the position. In the mean time, the plaintiff had entered into arrangements with various customers in anticipation of the availability of the tractor-trailer unit to be used on behalf of their company.

The defendants made some attempts to obtain the services of another driver, but were unsuccessful in doing so, and on approximately November 15, the defendant phoned the plaintiff company and simply advised that the whole arrangement was not going to work and that they didn’t have a driver and wouldn’t provide the services for which they had contracted. [ 4 ] It is clear in law, that this is simply a breach of contract, in which the defendant was unable or unwilling to provide the services she had contracted to provide.

While there is obviously a sense in which the availability of a driver was an essential part of their ability to fulfill their part of the contract, the fact is that they had indicated that they had a driver available and so advised the plaintiff. The plaintiff’s neither own trucks, nor do they provide drivers, and they entered into the contact in good faith, relying upon the defendants to fulfill their part of the arrangement.

The only sense in which the provision of the driver could be considered as a condition precedent would have been in the mind of the defendant and it certainly isn’t anything under the control of the plaintiff in any sense. The plaintiff was entitled to rely upon the representations made by the defendant that they were able to meet the terms of the contract at the time it was signed. [ 5 ] We come then, to the particulars of the plaintiff’s claim.

Some parts of it are derived from expenses actually incurred by the plaintiff in anticipation of the contract being fulfilled and some items are consequences for non performance of the contract that were set out in the contract and policy manual that is referred to in it. The items are listed for convenience on exhibit P2 and I will deal with them in the order in which they appear on that exhibit. [ 6 ] The first item relates to an insurance premium in the amount of $620.

The plaintiff explained that the insurance, which was referred to as cargo insurance amounted to $7600 per year per truck and that the amount claimed was pro-rated against the defendant from that payment. The plaintiff acknowledges that the obligation for that payment is not referred to in either the contract itself or the manual but testified that it was discussed verbally. The defendant has no recollection of that having been discussed at all and while Mr. Fisher acknowledged that it might have been talked about, he was not sure with respect to the details being discussed at the orientation meeting.

In light of the uncertainty concerning how accurately that obligation was communicated to the defendant, the court is not prepared to allow it. The next two items on exhibit P2 are for the licence plates for the trailer and the truck in the amounts of $300 and $325 respectively. The evidence indicated that the defendant was not in a position to pay for the plates up front and that the plaintiff undertook to do that on the understanding that eventually they would be compensated.

The second last item on exhibit P2 indicates the $500 deposit the defendant did make toward the cost of those licence plates and that item was properly deducted from the amount of the claim, as shown on the invoice. The next item was for decals. There are large decals placed on the doors of the truck and they are required to be there by law. They cost $150 and were provided to the defendant for installation on the truck and are properly charged to her. The next item relates to a drug test, required to be taken by Mr.

Laramee before he could be approved as a potential driver and the policy makes responsibility for the $84 cost that of the defendant. The second drug test item is abandoned as a claim by the plaintiff as not having been properly charged. The next item for $30 was a deposit for the cost of the policy and procedure manual and other documents, and it is offset by a $30 credit at the end of the list of items on the invoice when the materials were returned by the defendant to the plaintiff.

The next item is an administration fee of $100 charged in accordance with the provisions on page 12 of the policy manual and used to cover the various items that are referred to in the paragraph in which it appears. I am satisfied that the majority of those administration costs were actually incurred in anticipation of the contract being fulfilled, and are properly charged against the defendant. The next two items on exhibit P2 relate to the sincerity bonds referred to on page 5 of the policy manual.

The use to which that money will be put is set out in the policy manual with a provision that if the operator and or driver complete a three month probationary period that money will be refunded. It is clear in this case, that the three month probationary period was never effectively begun, let alone

finished and the amount is properly chargeable against the defendant. The second sincerity bond appears to be in relation to the potential use of Michael Fisher as an additional driver. Although I appreciate that from the evidence he was present during the original orientation and may have been present when Mr. Laramee was oriented, and did fill in an application form, it is also apparent from the evidence that he did not intend to drive on a regular basis if at all and was only willing to fill in if required, and in fact, may have been unable to make any trips into the United States.

In light of that, I am not persuaded that he ever obligated himself to any probationary period to the extent that a bond of this nature should be recoverable against the defendant. The largest item on the invoice, exhibit P2, relates to what is called the “nil notice” in the amount of $2500.

This figure is derived from a combination of the requirements the defendant undertook to meet if the contract was going to be terminated, as shown on page 5 of the policy manual, and the fee that would be charged to the defendant if proper notice of breach of the contract or termination of it was not provided to the plaintiff. While this may seem to be a significant amount, the plaintiff testified that it represented substantially less than the profit they would have lost as a result of being unable to fulfill contracts made in anticipation of the availability of the defendant’s tractor-trailer and driver.

The company’s estimate of it’s potential loss of profit as a result of this contract not being fulfilled would be something in the area of $12,000. This would arise of course, because they would be simply unable to meet their obligations to their own customers because they were short one tractor-trailer unit. This a potential consequence, the defendant agreed to suffer if the defendant’s end of the contract was not fulfilled. [ 7 ] In the end result, it makes little difference whether the court considers the items on the invoice to consist of damages or penalties.

If there are damages, they are largely verifiable, actual damages, or in the case of the sincerity bond and nil notice penalty consequences to the defendant that are probably less onerous than the actual loss of the plaintiff would have been.

In any event, the defendant’s obligations with respect to these amounts are clearly set out in the documents to which she agreed to be bound. [ 8 ] Deducting those which the court has not allowed, the plaintiff will have judgment for the amount of $3459, plus interest in accordance with the Pre-judgment interest act from the date the summons was issued and its costs. [ 9 ] I may say, for the sake of clarification, that exhibit P14 does not include all of the pages of the policies and procedures manual, because exhibits P5, P6, P10 and P11 were extracted from it during the course of the evidence being given.

Claim $3459.00 Interest, calculated from February 12, 2002 to date: 98.10 Costs 47.00 TOTAL $ 3604.10 DATED at SWIFT CURRENT , Saskatchewan, this __th day of March , A.D. 2003. ________________________________ T. GRANT FOR R. N. CONROY JUDGE OF THE PROVINCIAL COURT OF SASKATCHEWAN