Solving the Problems of. the Carrier
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Drawing Up a Contract
Second Article Relating the Story of a Conversation With a Haulier Who Desired to Know How to Draw Up a Contract for the Hire of a Vehicle IPOINTED out in the previous article that, whilst I am willitig to advise, ,I always recommend that the legal • stage of the procedure should be entrusted to a solicitor. r. would'further point out that 'there is no need for the various clauses in the contract to be drawn up in ' the same order as dealt With in this conversation. They are just the points to be watched, and although in these articles I ant giving some simple clauses, they are not to be regarded as absolutely the last word, :but subject to criticism and correction by the operator's 'own solicitor. In what I have already written I have dealt with the preliminaries, such as the description of the vehicle; the provision for terminating' the contract; the conditions of hire, setting -out what the haulage contractor is prepared to cid; provision for insurance, especially making a point that it is .not. usual for the.hhulage contractor to-take out a goods-in-transit policy, as he does not hold himself to be responsible for any damage or loss of goods carriedin the van which he ha8 on hire to his cuStomer. There is provision against overloading and against use of the vehicle to carry goods other than those of the customer. _I have dealt with the 'importance Of making provision that the customer must not encourage the driver to exceed the speed limit; also for adjustment of the price agreed which may'; be found necessary as the result of variation in the cost of petrol, wages and so on. • Before proceeding I should' like again to emphasize, as I did to this haidier friend of Mine that as he is preparing to apply for a contract-A licence, the minimum period to which such licence can appry is 12 mouths, and there • is the further condition that the driver must be the employee of the contractor who must pay his wages.
Fluctuations that Affect the Contract Price
" There is another clause," I Said to my friend, " which you must have inserted, and it. is one upon which your solicitor may require some instruction as it is peculiar to road 'transport. It follows on the one we have just discussed, in which,' provision is made for the variation in the contract price due to fluctuations in the. cost of petrol, tyres, wages add so on, and it .is of the same nature.
"Perhaps the best thing can do is to give you the clause as I have it, 'as it is self-explanatory. ' The contractor 'agrees to pay all present taxation and licences in connection with the van, and it is understood and agreed between the parties that, in the event of any additional taxation or licences being imposed on the contractor in respect. of the said motor van during the continuance of this agreement, the anddint of such additional taxation or licences shall be. payable by the hirer and adjusted from and according to the date such additionaltaxation or licences come into face.'
" Now,'' I continued, '.' have you discussed with your customer 'the times when he will need the van, whether it will be .wanted on Sundays and holidays, Saturday afternoons, oranything of that kind? ". " He did saV wanted it every day, Saturday after noons as replied my friend, " but I do not epeet he wants it on Sundays. I never thought. Of mentioning
I3ank Holidays and periods of that sort.— ,
. In that ease, yon had'. better word your contract accordingly, excluding Sundaa7s and Bank Holidays. ..
" Here is a 'clause which will fit the cCnclitions. '. The . motor 1.--,an is to be at the hirer's service daily, except
Sundays'and Stiitutory.Holiclays, and the rOcS.'w.ith.
the ContractOr tIcAt he (Jo his power to decide. . the contractor strictly -to ,..:omijiv With (lance 1l of the Road Traffic -Act, to psi v.erti-me required ,accordhig to the provisions and regulations issued in connection with the Road Haulage .Wages Act and, if the van by any chance be employed on Sundays or during the Statutory Holidays, then the extra wage iuvolved shall be paid by the hirer.'
." While we are talking about drivers, I might mention the need for having a clause in the agreement by which the , hirer agrees to provide all the necessary information to enable you to supply records required under Clause 16 of' the Road and Rail Traffic Act, 1933, That, of course, relates to the need for completing log sheets and so on. "-By the way," I continued, " some reference must be made as to the way in which the mileage is to be calculated. As a rule the place where the vehicle is to be garaged is named in the contract, and the daily mileage is presurded to start when the vehicle leaves the garage."
" But surely," objected my haulier friend, "if the van be in my customer's service, all the mileage recorded by the speedometer will be debited against him? "
" That may be so, but there is just the' risk that if no 'definite agreement had been made your customer might claim that the record of mileage ought to start only' from the time when the vehicle arrived at his premises for the day's work." " He would not do that sort of thing, I am sure." Mileage Point That Should Not Be Overlooked "I do not suppose he would, but it is necessary to provide against. misunderstandings: ' the document, therefore, maka it quite clear that the mileage commences when the vehicle leaves the premises at which it is housed and finishes when it returns there, " As a rule there is a clause in the agreement reading something like this' The contractor agrees to supply the hirer with an 'account of the mileage covered by the van, week by week, with the total mileage to date, such mileage to be reckoned from the premises where the vehicle is housed.'
" It is advisable, too, to stipulate how the mileage is to be reckoned."
" Ohl there will not be'any difficulty about that. There is a speedometer on 'the machine, Surely that will do? "
• " Certainly, but what is going to 'happen if it gets out of order? "I, Well, " Well, I suppose we would have to guess the mileage."
" Guessing may serve the purpose, but you cannot put guesswork into an agreement which is to be legally,binding. You state that the mileage is to be reckoned by the speedometer, but if the instrument gets out of commission the mileage during that period is to be based on an average. I suggest-you make a note of the average mileage covered during the -four preceding weeks."
" Do I need to stipulate that? '
" I certainly should do so; get your solicitor to draw
up a 'clause on the lines." • "Is theie anything more? "
Yes, one ot two items yet., You should reserve the right to withhold the vehicle -from service on,Say, one day per calendar month, to enable you to make adjustments and carry out Maintenance operations. On the other hand, it is most likely thatyour customer will. Want to stipulate' that if you keep it off the road for more than one day in accordance with this provision, ythi'must agree to stipply him With another van of eimdar caPacity. That, is I have already told you,. 1. itave provided for in the estimate -of -cliasges -which I, gave you before you
Came. ,to see me. , "
clatz'k which wo.uld be 'suitable to meet thi$ condition runs like this. —Thehirer' agrees (for the purposes of overhauling and painting) to allow the contractor to 'have
the van for one dear day in every month if necessary,
and least for a fortnight in every yeaa, another suitable vehicle being provided to take its place as mentioned above. " I presume you have made arrangements to cover yourself against any claim by your driver uncle the Workmen's Compensation Act?
" Do I have to do that while he is working In; somebody else?
" Most certainly. I have already told you that it is essential if you are to obtain a contract-A licen e that the driver must be in your employ, and be paid by you, and if that is so then clearly any claim for damages or injuries the driver may make will te against you as the employer
I therefore suggest that not only do you insure your driver in this way, but it is necessary for something to be inserted in the agreemtnt stipulating that you indemnify your customer against all claime by the driver under the Workmen's Compensation Act, the Employers' Liability Act and at Common Law.
This, of course, in addition to the clause we have already discussed which provided that' you will insure against, and in any event bear claims by, third parties in respect of injury or damage, where such may be caused by the negligence of your driver."
" Is my driver supposed to allow other people to ride in the van with him, or should I take-teps to forbid that? "
"I do not .see how you can entirely prevent it, but what you can and should do is to ask your solicitor to arrange. to insert a clause in the contract which will guard you against liability for injury to persons who ride on your vehicle without your permission, as well as against those who ride thereon just to suit the convenience of your customer.
" You should arrange to include the usual clause about strikes, lockouts, wars, and other abnormal conditions. Your solicitor will probably suggest that, and need. no prompting from you. Nevertheless, you might 'find it advisable to remind him that a commercial vehicle is in. a somewhat unique position in the event of an outbreak of warmll that it is likely, to be commandeered. As a matter
of fact such conditions have so occurred recently, and those are probably still in the minds of most of .us, solicitors included, so that it is .probable that this recommendation of mine is hardly decessary
"There are just one or two other safeguarding ..lauses. One is that the terms of the contract are not to be considered. to be varied except in writing '
" But isn't that making the wording a little too stiff and formal? '
" Not really. The brit-161ml object is. to prevent you from being bound by promises that your driver might make without reference to you.
' Additionally you might insist, if you like, that if the customer's business fairly permits it, the vehicle be used only on hard roads, " There are one or two more, as, for example 'The contractor shall reimburse the hirer for any sum reasonably expended by him, at the request of the contractoi s driver, for petrol, lubricants, grease., and repairs either to the vehicle or tyres, or otherwise in respect of the said van.' " " But surely that is giving them too much latitude, is it not? '
• ' No, because you will naturally expect dock-ets or receipts for anything that may be expended, and, if you do that, there immediately ceases to be any poin.. in them spending money that does not need to he spent. After all, they make nothing out of it, and there is no inducement to deceive.
"Another point 'The contractor will not accept any risk for goods left upon the van, after the conclusion of the day's work, which may be brought into the contractor's premises to be stored at night-time.'
"That is just to guard you against the possibility of something, Which has been left in the van, being stolen or damaged while in your .garage.
" Finally, there is the schedule, Which should have four clauses. First, a Z.-ton boxvan, body as chosen and painted and lettered as required by the hirer.
" Second, hire price, in which is set out the agreed price per annum with a note that payments are to be made in accordance with the paragraph described earlier, where you stipulate that you must be paid before the 14th of the month.
" Then in Clause 3 you should stipulate the contracted animal mileage and state the price which you expect to be paid in respect of excess mileage.'
" Finally, in Clause 4, a statement must be made of the current price of petrol and the current figure for wages per week for 48 hours plus overtime, and payments for -working on Sundays and holidays, the rates for all these items being taken from the current regulations issued under the Road Haulage Wages Act, This will cover you against increases in. the price of petrol and wage rates,"