Review of the Carriers and Innkeepers Act 1958Chapter 2 – Applicable Law[Return to Table of Contents]OVERVIEW2.1 This Chapter outlines who may be considered a carrier, and discusses the important distinction between private and common carriers. The obligations and rights of carriers at common law are discussed. The provisions of the Victorian Act relevant to carriers are then considered, and compared to the common law. CLASSES OF CARRIERSWho is a carrier? 2.2 A carrier is:
2.3 A carrier may be a private or common carrier.[14] This distinction is important as the Carriers and Innkeepers Act 1958 (Vic.) ("the Act") applies only to "common carriers". Common carriers2.4 A common carrier:
In other words, a common carrier may not refuse to carry goods without a lawful excuse (see below for examples of lawful excuses). 2.5 The concept of "holding oneself out" involves the communication to others of the fact that the carrier is willing to carry goods for reward. The "holding out" may be active or passive.[16] 2.6 Whether or not a carrier is a common carrier is a question of fact, which will not be determined by the carrier’s description of its own business.[17] All carriers who are not common carriers are private carriers.[18] 2.7 Examples of people found not to be common carriers (and who are therefore private carriers) include warehousemen, stevedores and furniture removalists.[19] The Public Transport Corporation in Victoria is expressly precluded from being a common carrier by its incorporating Act.[20] Private carriers2.8 A private carrier is one who, either on a casual basis or in the course of a business, undertakes the carriage of passengers, their goods and other people’s goods. A private carrier:
In practice, this merely means that a private carrier is one which reserves the right of accepting or rejecting offers for carriage.[22] 2.9 It is clear from submissions to the Committee that, in fact, almost all carriers today are private carriers.[23] For example, furniture removalists are private carriers. COMMON LAW OBLIGATIONS AND LIABILITIES OF CARRIERSCommon carriers2.10 The obligation of a common carrier to carry is imposed by the common law, which imposes further obligations and duties.[24] 2.11 The duties and liabilities of a common carrier commence when it has accepted the goods for carriage, and end when there has been actual or constructive delivery of the goods.[25] Obligations2.12 A common carrier is bound to accept goods offered to it for carriage unless the carriage sought is outside the profession of the carrier, or there is a lawful ground for refusal.[26] Carriage may lawfully be refused where, for example, the goods are intended for a destination to which the carrier does not carry, or if the carrier has no room in its vehicle.[27] Further, the price demanded by the carrier as payment for the carriage must be reasonable.[28] Liability2.13 A common carrier is absolutely responsible for the safety of the goods entrusted to it for carriage. A common carrier is even liable for loss caused wholly by the fault of other persons over whom it has no control, including theft of the goods carried, whether by its own servants or strangers.[29] 2.14 A common carrier will not be liable, however, where the loss or damage results from:
2.15 Loss due to an act of God arises where the loss is caused directly and exclusively by a direct, violent, sudden and irresistible act of nature which could not with any amount of ability be foreseen or, if it could be foreseen, could not by any amount of care and skill have been resisted so as to prevent its effect (for example, an earthquake).[31] An obvious example of an act of the Sovereign’s enemies would be a war. 2.16 A common carrier is not liable for any loss or damage caused by the act or omission of the consignor (except where the carrier is negligent).[32] Nor is a common carrier liable for harm to goods carried which is due to anything inherent in their own nature, over which the carrier has no control and against which it cannot guard (for example, perishable fruit).[33] Exclusion of liability2.17 A common carrier’s liability may be limited by special contract. At common law, such a contract may contain an absolute disclaimer of liability, by providing, for example, that carriage is at the "owner’s risk", in which case the carrier will not be liable for even gross negligence.[34] It seems, however, that liability for wilful damage on the part of the carrier may not be excluded. Such a limitation must be in express, plain and unambiguous terms.[35] 2.18 A common carrier’s liability at common law may also be limited by the display of a public notice. Such a notice must be given to the consignor at or prior to delivery for carriage. The notice may protect the carrier from liability for everything except his or her own wilful acts.[36] Comments on common law2.19 While the liability imposed on common carriers at common law in respect to loss of or damage to goods in carriage may seem onerous, it must be remembered that common carriers may escape liability in one of two ways - by including exclusion clauses in contracts with customers, and by the display of public notices.[37] As these courses are open to them, the burden imposed by the common law does not seem unduly onerous. liabilityPrivate carriers2.20 A private carrier’s obligation to carry particular goods arises from a contract entered into with another person, rather than from the common law.[38] In other words, the relationship between a private carrier and his or her customer arises from the entering into of a contract, and is determined by the terms of the contract. 2.21 A private carrier may therefore exclude its liability for loss, damage or delay in the terms of the contract of carriage.[39] Normal rules in respect of the incorporation of terms into contracts govern such an exclusion clause. 2.22 However, common law principles of negligence apply to private carriers, and impose an obligation on the private carrier to take reasonable care in the carriage of passengers and goods. A private carrier is therefore liable for damage, loss or delay resulting from his or her negligence. While a private carrier may attempt to exclude liability for his or her negligent acts in the contract, such an exclusion clause may be rendered invalid due to the operation of State and/or Federal fair trading laws.[40] Under general principles of liability, a private carrier will also be liable for damage and loss due to his or her intentional acts inconsistent with the consignor’s rights in the goods carried (for example, deliberately damaging the goods or selling them to another person).[41] LEGISLATION SPECIFIC TO COMMON CARRIERSPurpose of legislation2.23 Legislation was introduced in most of the Australian States and Territories, including Victoria, to provide common carriers with a means of limiting their absolute liability for loss or damage to goods. The purpose of the legislation is to enable common carriers to protect themselves against large losses from risks of which they are ignorant, and for which their charges are relatively low.[42] History of Victorian legislation2.24 An Act to amend the Law relating to Innkeepers Carriers and others was passed by the Victorian Parliament in 1859. The Act was modelled on the English Carriers Act 1830 (UK). The preamble to the Act indicates that it was considered "expedient to diminish the responsibility of innkeepers, mail contractors, stage-coach proprietors and common carriers in respect of the safe custody or carriage of parcels and packages containing articles of great value in small compass".[43] 2.25 The Act removed the common carrier’s absolute liability in respect of valuable goods (jewellery, gold, bank notes etc. as specified in the Act), where the value of the goods in the package to be carried exceeded the value of £10.[44] In other words, a common carrier was liable only where the value of the goods carried did not exceed £10. The exclusion of liability did not apply, however, where notice of the value of the goods was given to the carrier by the consignor at the time of the delivery of the goods to the carrier.[45] In that instance, the carrier could charge an increased rate for the carriage of the package provided that it displayed, in the office where packages were received, a notice stating the increased rates applicable.[46] 2.26 Where the value of the goods was so declared, and a higher rate charged, the carrier was obliged to provide a signed receipt on request. Where the receipt was not provided, the carrier could not claim the limitation of liability conferred by the Act, and the common law applied.[47] Further, except as outlined above, no notice displayed by the carrier was effective to limit its liability in respect of damage and loss to goods carried.[48] This provision therefore overrode the common law position that common carriers could limit their liability by the display of public notices. 2.27 However, nothing in the Act affected special contracts entered into by the parties, provided the contract was executed by the parties to it.[49] It was therefore open to a common carrier to limit its liability to a greater extent than permitted by the Act, through the use of contracts. This replicated the position at common law, as discussed above. 2.28 The Act did not protect the loss or injury to goods caused by a "felonious" act of any servant of the carrier.[50] However, once again, it was open to a carrier to overcome this provision through the use of a special contract. 2.29 A new Act was introduced as a result of the updating and consolidation of legislation that took place in Victoria in the 1950’s. The new Act was entitled the Carriers and Innkeepers Act 1958. On introducing the relevant Bill in Parliament, the then Minister for Transport stated:
2.30 Despite the passage of almost 100 years, the 1958 Act was substantially the same as the 1859 Act.[52] And despite further amending Acts since 1958, the current Act remains largely unchanged in relation to the liability of common carriers. Even the reference to a "stage-coach proprietor" remains. Current Victorian Act2.31 Section 3 of the 1958 Act (as currently in force) provides that a carrier will not be liable for the loss of valuable goods worth over $20.[53] Again, this is subject to the proviso that the consignor of the goods may declare their value to the carrier, in which case the carrier may increase the charge for carriage.[54] As in the original Act, the carrier may charge the increased rate only where the necessary notice of rates is displayed.[55] 2.32 As in the 1859 Act, the carrier must provide a receipt upon request or forfeit the protection of the Act.[56] Notices other than the one referred to in section 4 are ineffective to limit liability.[57] Again, a special contract entered into by the parties overrides the provisions of the Act.[58] Damage and loss to goods caused by the criminal acts of the carrier or the neglect or misconduct of his or her servants are precluded from the protection offered by the Act.[59] 2.33 In short, there are no substantial differences between the original Act and the current Act, despite the passage of well over 100 years. Comments on current Victorian Act2.34 The Act was introduced to protect common carriers and others from the seemingly unlimited liability at common law. However, common carriers are in fact able to limit their common law liability through both special contracts and public notices. As noted above, the common law does not, therefore, impose an unreasonable burden, as common carriers may restrict their liability in this manner. 2.35 The legislation does not affect the ability of common carriers to contract out of their liability. However, carriers can no longer limit their liability by the display of public notices, except as provided by the legislation. The legislation provides for an across the board limit on the liability of common carriers in respect to specified valuables worth over $20, provided certain requirements are met, but permits carriers to limit their liability even further through the use of contracts. 2.36 It may be argued that, as common carriers may contract out of their common law liability, the legislation is irrelevant and unnecessary. Submissions to the Committee in fact support this view.[60] Legislation in other States and Territories2.37 The States of New South Wales, South Australia, Tasmania and Western Australia also have legislation regulating the carriage of goods: the Common Carriers Act 1902 (NSW); the Carriers Act 1891 (SA); the Common Carriers Act 1874 (Tas.); and the Carriers Act 1920 (WA). The New South Wales Act applies in the Australian Capital Territory with certain amendments.[61] The South Australian Act applies in the Northern Territory. 2.38 These Acts are written in the same outdated style, and are to similar effect, as the Victorian Act. This is not surprising, as all Acts have their origin in the Carriers Act 1830 (UK). 2.39 Queensland had similar legislation which was, however, repealed following the decision of the High Court in Wallis v Downard-Pickford (North Queensland) Pty Ltd.[62]
Scrutiny
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