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Owner/Ops: Are you entitled to share of $15M settlement?


If you were a Canadian owner/operator hauling into the US between 1991 and 2002, the carrier you worked for at that time may have a cheque for you. As I first reported last week, a group of about 35 carriers has won a landmark settlement against Canada Revenue Agency that will see up to $15 million returned to their owner/operators.
The issue involves the federal excise tax paid on diesel that was consumed outside Canada. The carriers, represented by Manitoba-based lawyer Israel Ludwig, managed to convince CRA that the diesel they brought into the US qualified as an ‘export,’ making it eligible for an excise tax rebate. Carriers received rebates for company-owned trucks in 2003, however, the battle continued on behalf of owner/operators for several years.
CRA’s position was that, as independent businesspeople, the owner/operators should have filed on their own. Ludwig, on the other hand, argued that’s not how the industry works. Often, the carrier orchestrates fuel purchasing using company cards and then deducts it from their owner/operators’ pay. In November, CRA agreed to reimburse the carriers for the excise tax paid by their owner/operators. The first cheques have gone out to three fleets that served as test cases: Nolan Transport, Bison Transport and Penner International.
Nolan has already made payments to the owner/operators that qualified for the rebate with some of them receiving up to $16,000. Owner/ops who bought fuel in Canada and did most of their driving in the US stand to gain the most. While Israel told me it would be illegal for carriers to pocket the rebate rather than pass it on to the owner/operators who earned it, there are some concerns about just how hard some of the carriers will work to track down owner/ops who may not have worked for them for more than a decade. I visited Nolan Transport the other day, and co-owner Kelly Nolan admitted it’s a lot of work. Yet, she has enjoyed calling past owner/ops, catching up and, oh yeah, telling them she’s got a cheque for them.
Kelly comments on the experience in this video.

The other 30-plus carriers involved in the settlement will be receiving cheques in the next 60-90 days, Israel told me. Carriers that weren’t audited back in 03 or 04 will have to wait till their audits are complete, to determine just how much they’ll receive. While I suspect most, if not all, carriers will do the right thing and pass the funds onto their owner/operators, I’ve filed an Access to Information request with CRA to see who was involved in the settlement and how much each carrier received. (Israel wouldn’t provide me with the list due to client confidentiality obligations). I’m hoping we can play a role in connecting these companies with owner/operators who may be in line for a payment.
It’s a great story, as it’s not every day owner/operators get an unexpected cheque from Revenue Canada. Unfortunately, if you weren’t working at the time for a carrier that was among the few dozen who brought this case to court, you won’t be able to make a claim. The feds passed legislation in 2003 that closed this loophole and prevents any further claims on fuel purchased in Canada and consumed elsewhere.


James Menzies

James Menzies

James Menzies is editor of Truck News magazine. He has been covering the Canadian trucking industry for more than 15 years and holds a CDL. Reach him at james@newcom.ca or follow him on Twitter at @JamesMenzies.
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14 Comments » for Owner/Ops: Are you entitled to share of $15M settlement?
  1. Ralph The Trucker says:

    James, I admire your optimism about the 30-plus carriers BUT I highly doubt they will put much if any effort in searching for past O/O’s. Do you honestly believe that the Feds will put any pressure on them to ensure the monies are passed on to those that it rightly belongs to. James, if you believe this you have much more faith in both our Federal Government and the for-hire carriers in this country that the majority of readers do.

  2. Robert D. Scheper says:

    James… GREAT FIND! I’ve had several calls this week on it already and it appears trucking company reps had NO IDEA what it was (however people are investigating). In your freedom of information request, if you could get (and post) the dollar figures sent by CRA to each trucking company it would assist in separating “the friend from the fiend”. The total received by the trucking company can be offset by the total released (dollar for dollar). There is absolutely no way to hold companies accountable without transparency. If companies refuse to comply its obvious they have something to hide. I assume this will be an on-going battle for maybe a couple years as operators fight for the truth (and maybe even launch actions). Hats off to Nolan Transport for embracing integrity, I’m sure they’ll receive many times more in positive sentiment. Simple honesty and integrity… (wow)… beats hiring a sport coat clad recruiter and sending him out in an RV all summer with an expense account.

  3. Lance Achilles says:

    I agree with Ralph these companies are going to horad as much of the money as they possiable can it is how trucking companies work and survie off the backs of the owner operators they have no morals. That is why I sold my truck and became a company driver let them pay me hourly and have to pay all the bills.

  4. Ray Gompf says:

    I worked for Gerth Transport, now Celedon. I wonder if they’ll do any work to find that 100 plus owner operators. I worked for Trans Border Express — now defunct, I don’t imagine there’d be any hope there.
    They didn’t want to pay us what we were worth, I don’t imagine they’d want to pay us what is actually our due more than a decade later.

  5. Stephen Large says:

    I agree with the above comments! I worked for a few large carriers, hauling across the border from 1988 to 2001, and in my experience, it was a constant fight to get the revenue that was due at the time, let alone anything after the fact! I really doubt that there will be many carriers who will put any effort into making sure the money goes where it belongs! Congratulations to Nolan Transport for being honest and returning the money to it’s rightful recipient!!

  6. Henry Reimer says:

    Hello James. This is interesting. Without showing too much ignorance, how was this excise tax collected by the CRA? Is it the tax paid on all the fuels sold at the pumps? As an independent, the tax is paid in the fuel price, and the vendor gets involved in the calculations..?

  7. Jake Goertzen says:

    To answer Henry Reimer’s question about Federal Excise tax on diesel fuel, I can tell you it is $0.04 per Liter which is “collected at the pump” and included in the fuel price,( http://www.cra-arc.gc.ca/E/pub/et/currate/currate-e.html )in addition to provincial taxes which are generally quite a bit higher.
    If you’re a number cruncher you can dig out your old fuel receipts from 1991 through 2002 and add up how many liters of Canadian fuel you bought that was subsequently consumed in the USA, multiply that figure by 0.04 and you have calculated your total Canadian Federal Excise Tax paid. As you can see, this can be a daunting task assuming you have even bothered to keep receipts from that long ago.
    Now, what motivation is there for an employer to go through this frustrating administrative exercize on behalf of an employee who has left the company, retired or been fired? A for-profit trucking company is generally not in business to extract money from the CRA for its sometimes-disgruntled ex-employees with no incentives for the company.
    It is precisely this scenario that makes Nolan Transport stand out as exemplary. They have apparently made substantial efforts in locating their ex-employees simply to act as intermediaries for purposes of forwarding CRA refunds on the sole basis of morally upright behaviour.
    On the other hand, why would an employer file a lawsuit on behalf of its employee, as in my own case, without any notice to the employee? I would certainly like to have input to a lawsuit against the CRA that is being waged on my behalf! How am I expected to verify records from a decade ago? How am I expected to trust an employer who tells me any details of the lawsuit when I wasn’t even consulted in the first place? Why is there no detailed information available about this settlement for the owner operators who apparently won this case?

  8. Jake Goertzen says:

    I have some additional information regarding this settlement: my former employer has informed me that they were not eligible for a refund of the entire twelve-year period (1990 thru 2002)due to some legal technicalities related to the two-year statute of limitations. It appears that the Ontario based companies were represented by a more competent consulting firm than the Manitoba based companies and as a result, companies like Nolan Transport were in a position to receive a refund for the entire twelve-plus-year period of the drawn-out legal battle. According to my sources, the two Manitoba based companies mentioned in your report were only eligible to receive refunds for two separate non-contiguous two-year periods for a total of four years.
    This begs the question; should anyone be held accountable for not taking full advantage of this once-in-a-lifetime opportunity? In other words, it doesn’t seem exactly fair for Nolan Transport to collect more that twice as much as Bison Transport and Penner International simply because the latter two companies didn’t take full advantage of the available refunds.
    I understand those who say any federal fuel tax refund is a bonus and those of us who are lucky enough to be included on the recipient list should just shut up and take what we get. On the other hand, if a trucking company is paying a professional consulting firm to act on its behalf, wouldn’t the trucking company be entitled to get the best returns for the consulting fees paid, especially when there is a clear-cut case of a direct comparison to the results of its competitor?
    What do you think James?

  9. Robert G Herr says:

    would anyone know which 30-35 companies are part of this lawsuit

  10. Elizabeth rout says:

    We at Highland transport have been waiting for Transforce to pay the excise tax due the owner operators for the period of 1995-2002, but as yet we have not received a dime. If anyone knows how to contact the
    federal goverment excise department so we can inform them about this, please e-mail me back with the information.

  11. betty maher says:

    mackie Transport was part of this group and never phoned any O/O to say they were using their information or to tell them of an outcome. Some O/O are still at the same phone numbers and addresses and they did not even try.
    I phoned them and they let on they knew nothing until I informed them that I did.
    So here is a Company that wants to pocket the money. Then they want Some stupid proof on things. They had to have the proof to get the money, So all a person really needs is the proof he is who he says he is, The rest is Bull Sh–.

  12. Elizabeth rout says:

    We at Highland Transpiort are still waiting to receive our excise tax refund, but Transforce is refusing to give it to us, we have been told that becuse we had a fuel cap, their intitled to the refund and not us. if any for the owner operators received their refund and had a fuel cap at heir company, please email me bank with this informatiom. My husband was an o/o with Highland transpoert for 15 years. he just died of pancreatic cancer August 2, 2011 and one of his last things he said to me was to not let transforce cheat me out of this money, befause he knew I would need it to pay for his buriel. So any informatiion you can help me with would be gratly appreciated. Thank you Elizabeth.

  13. Teodor Glowacki says:

    I was a driver for Concord Transportation from ’92-’98 as an owner operator and have contacted Concord Transportation regarding the refund. I was told that the cheque for settlement was sent to Transforce – upon contacting Transforce I was told Concord drivers will not be entitled to any refunds. If any one has suggestions on how to proceed let me know – if we can get more drivers to come forward maybe we’ll have a shot at getting our fair share of money.

  14. Elizabeth Rout says:

    We at Highland contacted the union and they have hired a lawyer to deal with this matter. Transforce are bullys, taking bread and butter out of the hard working owner operaters who made theses companies what they are. My suggestion is to all Owner Operaters to start a class action law suit against Transforce and Canada
    Rev. Agency. Canada revenue Agency told the companies that the money was to go to the O/O and not them, they should have over seen this process as the law suit was brought on behalf of the Owner/Operaters. Transforce thinks they are above the law, well let show them that they are not. We have the law on our side and Cda. Rev. Agency as well. My husband worked for Highland from 1996 to 2010. He died last year and before he died, he made me promise to not let Transforce cheat me out of the money owed him. i gave himmy word, and i will persue as long as it take.

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