CSA 2010 Will Require Contract Revisions

Kevin Anderson Contracts, CSA 2010, Transportation

One of the critical changes CSA 2010 will make is the replacement of SafeStat with the Safety Measurement System (SMS). Under SafeStat carriers were rated as either “satisfactory”, “conditional”, “unsatisfactory” or “unrated”. However, with the change to SMS, carrier ratings will be replaced with a Safety Fitness Determination (SFD) of “Continue Operation”, “Marginal”, or “Unfit”. While this may appear to be mere semantics, it will require you to review and revise, as necessary, your carrier qualification standards and documentation.

Contracts used by carriers (where the carrier subcontracts or “brokers” loads), shippers and brokers often require motor carriers to maintain a “satisfactory” safety rating. However, with the end of SafeStat, the “satisfactory” rating will no longer exist. The contract language will need to be changed to ensure the same contractual effect under the new SMS/SFD.

Similarly, many equipment leases with owner-operators, independent contractors, and leasing companies require the vehicles leased to meet certain federal safety standards or that certain safety ratings be maintained. These contracts will also often have language that must be revised in light of the changes being imposed by CSA 2010.

Finally, tariffs used by motor carriers (a few issues ago, we explained why tariffs are still required and recommended that every carrier publish a tariff to define the terms of its relationship with other businesses) also will require reevaluation. Tariffs often refer to “satisfactory” ratings and use other terms that will be inconsistent with CSA 2010.

As we get closer to the implementation of CSA 2010, it is important to have your company’s legal documents reviewed and revised to accommodate these changes.