Decision No. 90-R-2007

February 26, 2007

File No. R8050/866-140.59

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APPLICATION

On November 1, 2006, TELUS Communications Company (hereinafter TELUS) applied to the Canadian Transportation Agency (hereinafter the Agency) for the authority set out in the title.

Pursuant to Decision No. 673-R-2004 dated December 10, 2004, the Agency issued a Certificate of fitness to Kettle Falls International Railway Company (hereinafter KFIRC) permitting it, inter alia, to operate a railway through a lease agreement with BNSF Railway Company (hereinafter BNSF) between the Canada/United States border near Waneta, British Columbia and Columbia Gardens, British Columbia of the Kettle Falls Subdivision. It is noted that the subdivision pursuant to the lease agreement is the Kettle Falls Subdivision and not 11th Subdivision as indicated in the title. In a submission dated February 22, 2007, TELUS advises that it agrees with the description of the location of the proposed crossing as mileage 140.59, Kettle Falls Subdivision.

In light of the lease agreement between BNSF and KFIRC, the Agency, in its Decision No. LET-R-9-2007, requested the parties to confirm which party would be making decisions regarding any proposed crossing of the leased portion of the railway line in question. On February 1, 2007, BNSF confirmed that it is entitled to make decisions with respect to any crossing agreement. BNSF also advised that it had contacted KFIRC and invited it to contact the Agency directly with respect to this application, should it have any inquiries or concerns. KFIRC did not file a response to Decision No. LET-R-9-2007 with the Agency.

PRELIMINARY MATTERS

Although BNSF filed its answer and its response to Decision No. LET-R-9-2007 after the prescribed deadlines, the Agency, pursuant to section 5 of the Canadian Transportation Agency General Rules, SOR/2005-35, accepts them as being relevant to its consideration of this matter.

ENVIRONMENTAL ISSUE

Pursuant to subsection 18(1) of the Canadian Environmental Assessment Act, S.C., 1992, c. 37, the project has been screened and a screening report has been prepared.

After taking into consideration the screening report, the Agency has determined that the project is not likely to cause significant adverse environmental effects.

QUESTION

The issue to be addressed is whether TELUS should be granted authority to construct the proposed utility crossing pursuant to subsection 101(3) of the Canada Transportation Act (hereinafter the CTA).

FACTS

The parties have agreed on the conditions of construction, location and future maintenance of the crossing. However, TELUS objects to certain terms of the proposed agreement.

ANALYSIS AND FINDINGS

In making its findings, the Agency has considered all of the evidence submitted by the parties during the pleadings.

Subsection 101(3) of the CTA states that:

If a person is unsuccessful in negotiating an agreement or amendment mentioned in subsection (1), the Agency may, on application, authorize the construction of a suitable road crossing, utility crossing or related work, or specifying who shall maintain the crossing.

The Agency notes that TELUS and BNSF have been unsuccessful in negotiating an agreement with respect to fees, duration, liability, personal property waiver, insurance and termination.

TELUS submits that BNSF has revised the proposed agreement, however, in its view, these changes do not reflect the terms and conditions of Agency rulings, nor are they consistent with other modern crossing agreements that TELUS has with other major railway companies in Canada. TELUS identified certain areas of disagreement and set out the positions of both parties.

In its answer, BNSF submits that the Agency decision should incorporate the terms set out in Order No. 2004-AGR-530 and Decision No. 351-R-2004 which dealt with utility crossings between BNSF and British Columbia Hydro and Power Authority (hereinafter B.C. Hydro). TELUS argues that the terms of the above mentioned decision and order were negotiated between BNSF and B.C. Hydro and that TELUS is not a party to that agreement. TELUS, therefore, sees no reason why that agreement and the resulting order should serve as a precedent for an order in this proceeding.

Applications are dealt with on a case-by-case basis and the Agency finds that Order No. 2004-AGR-530 and Decision No. 351-R-2004 are not relevant to its consideration of this matter.

The Agency will now deal with the issues under dispute, being fees, duration, liability, personal property waiver, insurance and termination.

Fees

BNSF requested that TELUS pay an amount of US$450 as compensation. TELUS' position is that no fees are due. In this regard, the Agency has reviewed the evidence provided by the parties and has determined that, in this case, compensation in the form of annual or documentation fees or consulting fees or contracting fees for documentation review are not warranted as no real or appreciable damage to the lands of the railway company has been demonstrated.

Liability/Insurance

TELUS objects to the proposed liability wording proposed by BNSF but agrees to accept language similar to other rulings that the Agency has made in this regard.

The Agency is of the opinion that liability for negligent acts by either party at railway crossings ought to be determined by the civil courts in the province in which the crossing is situated and that a party for whose benefit a statutory right of crossing is established should not be made responsible for the railway company's own negligence.

Duration/Termination

BNSF proposes that the duration shall continue for a period of 25 years, subject to prior termination. TELUS' position is that upon application to the Agency, the term should be for so long as is required or until cancelled by the Agency.

In this regard, a decision issued by the Agency authorizing the construction of a utility crossing at a specific location remains in effect until such time as the decision is amended or rescinded by the Agency or its successor.

Personal property waiver

BNSF has provided proposed wording in this respect, however, TELUS disagrees with the proposal. TELUS submits that it is willing to accept language from agreements it has with other major railways companies, similar language to that which is included in other Agency rulings issued on this matter.

The Agency has considered this matter and finds it appropriate to condition any approval that may be granted to the following clause:

TELUS shall at all times indemnify BNSF across or along whose railway the utility crossing is constructed, from and against all loss, cost, damage, injury and expense to which that railway company may be put by reason of any injury to persons or damage to property caused by the construction, maintenance or operation of the utility crossing as well as against any damage or injury resulting from imprudence, neglect or want of skill of the employees or agents of TELUS in connection with the construction, maintenance or operation of the utility crossing unless the cause of such loss, cost, damage, injury or expense can be traced elsewhere.

CONCLUSION

In light of the foregoing, the Agency, pursuant to subsection 101(3) of the CTA, hereby authorizes TELUS to construct and maintain, at its own expense, the utility crossing as shown on Drawing No. QYZ-035-013, revised June 21, 2005.

Members

• Baljinder Gill
• Mary-Jane Bennett