DISPUTE RE ALLEGED TERMINATION OF CONTRACT IN THE WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION SITTING AS THE ROAD FREIGHT TRANSPORT INDUSTRY TRIBUNAL CITATION : 2016 WAIRC 00327 CORAM :Commissioner S J Kenner HEARD : Tuesday, 8 March 2016, Wednesday, 9 March 2016 DELIVERED : THURSday, 26 May 2016 FILE NO. : RFT 16 OF 2015, RFT 17 OF 2015, RFT 18 OF 2015, RFT 19 OF 2015, RFT 20 OF 2015 BETWEEN : Richard Van Dongen as Trustee for the F.R.A.C Family Trust, t/a L and R Cartage Contractors; Graeme Smith, Trading as Maranatha Transport; Van Dongen Haulage Pty Ltd; Chang Transport and Scrap Metal Pty Ltd; Lark Hill Transport Pty Ltd Applicants AND Sims Metal Management Ltd Respondent Catchwords : Industrial Law (WA) - Owner-driver contracts - Request for competitive tenders - Whether respondent engaged in unconscionable conduct - Whether respondent failed to negotiate in good faith - Whether respondent misused its bargaining power in forcing applicants to reduce their rates - Principles applied - Parties were seeking to act in accordance with their commercial interests - Applicants in no different position to all owner-drivers seeking contracts - No obligation to offer fresh engagements - Respondent was not in a superior bargaining position - Not persuaded that respondent engaged in unconscionable conduct or contravened the obligation to negotiate in good faith - Applications dismissed Legislation : Industrial Relations Act 1979 (WA) Owner-Drivers (Contracts and Disputes) Act 2007 (WA) Owner-Drivers (Contracts and Disputes) (Code of Conduct) Regulations 2010 (WA) Trade Practices Act 1974 (Cth) Competition and Consumer Act 2010 (Cth) Result : Applications dismissed Representation: Counsel: Applicants : Mr A Dzieciol of counsel Respondent : Mr N Mony De Kerloy of counsel Case(s) referred to in reasons: ACCC v Leelee Pty Ltd [1999] FCA 1121 ACCC v Simply No-Knead (Franchising) Pty Ltd (2000) 104 FCR 253 ACCC v 4WD Systems Pty Ltd (2003) 200 ALR 491 ASIC v National Exchange Pty Ltd [2005] FCAFC 226 Hughes Aircraft Systems International v Air Services Australia (1997) 146 ALR 1 Louisville Holdings Pty Ltd v Sims Group Australia Holdings Ltd t/as Sims Metal Management [2015] WAIRC 00178; (2015) 95 WAIG 408 Meudell v Mayor of Bendigo (1900) 26 VLR 158 Pratt Contractors Ltd v Palmerston North City Council [1995] 1 NZLR 469 Qantas Airways Ltd v Cameron (1996) 66 FCR 246 Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234 South Sydney District Rugby League Football Club Ltd v News Ltd (2000) 177 ALR 611 Spencer v Harding (1870) LR 5 CP 561 Supaworld Pty Ltd (trading as Cousins Transport) v LN Price Partners Pty Ltd (ACN 053 962 299) (trading as Busselton Freight) [2015] WAIRC 00203; (2015) 95 WAIG 649 Case(s) also cited: Automasters Australia Pty Ltd v Bruness Pty Ltd & Anor [2002] WASC 286 Bitumen Transport Pty Ltd v Logiwest Express [2014] WAIRC 1369 Murphy v Overton Investments Pty Ltd (2004) 204 ALR 26 === REASONS FOR DECISION === ¶1 The Tribunal has before it five applications against the respondent Sims Metal Management Ltd. The applications each concern owner-drivers who have, over a number of years, performed services for Sims in the cartage of scrap metal. The claims as originally commenced, maintained that Sims breached the owner-driver contracts between it and the applicants by failing to provide reasonable notice of termination of the contracts. Furthermore, the applicants alleged that Sims, in relation to the request for a tender for the provision of scrap metal cartage services, engaged in unconscionable conduct under s 30 of the Owner-Drivers (Contracts and Disputes) Act 2007 (WA) and failed to negotiate in good faith as required by s 6 of the Owner-Drivers (Contracts and Disputes) (Code of Conduct) Regulations 2010 (WA). The applicants originally sought damages for the wrongful termination of the owner-driver contracts and additionally, damages for the alleged unconscionable conduct and failure to negotiate in good faith. ¶2 The applicants do not press the claim for damages for wrongful termination of the contracts. Whilst recognising that the Tribunal has previously found that the owner-driver contracts between owner-drivers and Sims for the provision of similar services, were not ongoing and each contract stood alone, the applicants maintained there are some distinguishing features in the present cases: Louisville Holdings Pty Ltd v Sims Group Australia Holdings Ltd t/as Sims Metal Management [2015] WAIRC 00178; (2015) 95 WAIG 408. Nonetheless, the wrongful termination claims were abandoned. The applicants each claimed damages for the loss of one years’ earnings. L & R Cartage Contractors claimed $87,400. Maranatha Transport claimed $123,340. Van Dongen Haulage Pty Ltd claimed $135,000. Chang Transport and Scrap Metal Pty Ltd claimed $145,800 and Lark Hill Transport Pty Ltd claimed $150,500 in damages. The total in damages claimed against Sims was $642,040. ¶3 In brief, the applicants maintained that they have engaged in the provision of services as owner-drivers to Sims for many years, generally carting scrap metal to wharves for shipment overseas. In April 2015, Sims invited the applicants to submit tenders for the provision of services in the cartage of scrap metal. The applicants did so in about May 2015. The applicants were then advised that their tenders were not successful. Revised further tenders for services were submitted by the applicants to Sims in June 2015. It was contended that following some advice from Sims to at least one of the applicants, a further revision of the tenders by reducing rates by 10% was submitted. However, ultimately, the applicants were not successful in securing ongoing work. ¶4 As a result of these events, the applicants contended that Sims acted unconscionably. The unconscionable conduct was said to be by reason of the fact that the applicants had been providing services to Sims over many years and Sims had misused its bargaining power in forcing the applicants to reduce their rates. It was further contended in this regard, that Sims, in forcing the applicants to reduce their rates in the tender process, exerted undue pressure and engaged in unfair tactics as the rates required by Sims were not safe and sustainable rates, and were not rates at which the services could be provided, whilst meeting legal requirements. ¶5 Furthermore, the applicants contended that the conduct of Sims breached its obligation of good faith in relation to negotiations for the variation and/or renewal of the owner-driver contracts, as in effect, Sims required the applicants to bid against themselves in the tender process. Furthermore, Sims refused and/or failed to enter into meaningful negotiations with the applicants in relation to the tenders, whilst engaging in such discussions with other parties. This was a further basis on which the applicants alleged Sims’ conduct was unconscionable and unfair. ¶6 Sims wholly denied the applicants’ claims. It did not dispute that the applicants were owner-drivers for the purposes of the OD Act and that they have been engaged in the provision of services to Sims for a number of years. Sims however noted, consistent with the Tribunal’s decision in Louisville Holdings, that the owner-drivers have provided these services on a stand-alone contract basis only. Sims further contended that during the course of the time over which the applicants have provided services to Sims, the applicants were able to undertake other work. ¶7 In late April 2015, Sims decided to engage in a competitive tender process for all of its transport service providers. The intention of Sims was to award contracts for services for a period of three years, rather than ad hoc arrangements as had been the case previously. The reason Sims embarked on a competitive tender process was in order to improve the efficiency of its services and also to reduce costs. ¶8 Sims denied that the tender process was in any way unconscionable or unfair. It maintained that the process was open and transparent and all owner-drivers were provided the opportunity to tender on a competitive commercial basis. Sims further said that the tenders were assessed against the criteria set out in the tender documents, and the successful tenderers were more competitive than the applicants. Sims therefore maintained that the applications should be dismissed in their entirety. [Unconscionable conduct and breach of good faith] ¶9 As this case involves consideration of s 30 of the OD Act I set it out as follows: [30. Unconscionable conduct by hirers] (1) A hirer must not engage in conduct that is, in all the circumstances, unconscionable with respect to an owner-driver in relation to the acquisition or possible acquisition by the hirer of services from the owner-driver under an owner-driver contract. (2) Without in any way limiting the matters to which the Tribunal may have regard for the purpose of determining whether a hirer has contravened subsection (1), the Tribunal may have regard to the following — (a) the relative strengths of the negotiating positions of the hirer and owner-driver; (b) whether, as a result of conduct engaged in by the hirer, the owner-driver was required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of the hirer; (c) whether the owner-driver was able to understand any documents relating to the acquisition or possible acquisition by the hirer of services from the owner-driver under an owner-driver contract; (d) whether any undue influence or pressure was exerted on, or any unfair tactics were used against, the owner-driver (or a person acting on behalf of the owner-driver) by the hirer or a person acting on behalf of the hirer in relation to the acquisition or possible acquisition by the hirer of services from the owner-driver under an owner-driver contract; (e) the amount for which, and the circumstances under which, the owner-driver could have provided identical or equivalent services to a person other than the hirer, including as an employee; (f) the extent to which the hirer’s conduct towards the owner-driver was consistent with the hirer’s conduct in similar transactions between the hirer and other similar owner-drivers; (g) the requirements of the code of conduct; (h) the extent to which the hirer unreasonably failed to disclose to the owner-driver — (i) any intended conduct of the hirer that might affect the interests of the owner-driver; and (ii) any risks to the owner-driver arising from the hirer’s intended conduct that are risks that the hirer should have foreseen would not be apparent to the owner-driver; (i) the extent to which the hirer was willing to negotiate the terms and conditions of the acquisition or possible acquisition by the hirer of services from the owner-driver under an owner-driver contract; (j) the extent to which the hirer acted in good faith; (k) whether or not the owner-driver contract provides for the payment of any increases in the owner-driver’s fixed and variable overhead costs (as defined in section 27(4)). ¶10 Furthermore, it is also convenient at this point to refer to s 6 of the Code which is as follows: [6. Parties to negotiate in good faith] (1) In the negotiation of an owner-driver contract, or the variation or termination of a contract, the parties have a duty to negotiate fairly and in good faith but that does not prevent hirers and owner-drivers from acting in their own commercial interests. (2) In subsection (1) — party means — (a) the hirer; or (b) an owner-driver or a group of owner-drivers, that is involved in the negotiations, and includes any negotiating agent that is so involved. (3) This section in its application to a group of persons that is acting as a negotiating agent applies to each member of the group individually. ¶11 In Supaworld Pty Ltd (trading as Cousins Transport) v LN Price Partners Pty Ltd (ACN 053 962 299) (trading as Busselton Freight) [2015] WAIRC 00203; (2015) 95 WAIG 649, the Tribunal considered, for the first time, the unconscionable conduct provisions of the OD Act. In that case, the Tribunal referred to the comparable provisions of the former Trade Practices Act 1974 (Cth) Part IVA and Part 2-2 of Schedule 2 – The Australian Consumer Law of the Competition and Consumer Act 2010 (Cth) as guidance in the application of s 30 of the OD Act. Reference was also made to the relevant common law principles in relation to unconscionability and the leading cases. ¶12 For the purposes of these claims, I expand upon and develop these matters in more detail. I remain of the view that the terms of the ACL provide guidance to the Tribunal on the approach to the application of ss 30 and 31 of the OD Act. In this respect, ss 21 and 22 of the ACL are most apposite and the combined effect of these provisions is to not limit the concept of unconscionable conduct to what might be regarded as unconscionable for the purposes of the common law. By s 22 of the ACL, a number of considerations are set out that a court may take into account in assessing whether a corporation has engaged in unconscionable conduct. A comparison with ss 30(2) and 31(2) of the OD Act shows that these provisions are drafted in many respects, in almost identical terms, to those of the ACL. ¶13 Whilst ss 30(1) and 31(1) of the OD Act do not say, as does s 21(4)(a) of the ACL, that they are “not limited by the unwritten law relating to unconscionable conduct” (which means the Australian common law), given the expansion of the concept of unconscionability by the factors to be considered in ss 30(2) and 31(2) and its correspondence with s 22(1) of the ACL, I also consider that the OD Act provisions are not to be limited to the common law concepts of unconscionability. I therefore accept the submissions made by the applicants in this regard: ACCC v Simply No-Knead (Franchising) Pty Ltd (2000) 104 FCR 253. I also consider, as for ss 21 and 22 of the ACL, that the concept of “unconscionable” in both ss 30(1) and 31(1) is not to be read down in accordance with equitable principles. However, the relevant conduct must still be characterised as unconscionable and based on intentional or reckless acts: ACCC v 4WD Systems Pty Ltd (2003) 200 ALR 491. As was said by Selway J in discussing the scope of the former s 51AC of the TPA in 4WD Systems at pars 184-185: ¶14 [184] The ordinary or dictionary meaning of the word “unconscionable” was explained in Hurley v McDonald's Australia Ltd (2000) ATPR 41-741 at [22]: ¶15 For conduct to be regarded as unconscionable, serious misconduct or something clearly unfair or unreasonable, must be demonstrated — Cameron v Qantas Airways Ltd (1994) 55 FCR 147 at 179. Whatever “unconscionable” means in s 51AB and s 51AC, the term carries the meaning given by the Shorter Oxford English Dictionary, namely, actions showing no regard for conscience, or that are irreconcilable with what is right or reasonable — Qantas Airways Ltd v Cameron (1996) 66 FCR 246 at 262. The various synonyms used in relation to the term “unconscionable” import a pejorative moral judgment — Qantas Airways Ltd v Cameron (1996) 66 FCR 246 at 283–4 and 298. ¶16 [185] In order to find that conduct is “unconscionable” it is necessary to do more than merely show that the behaviour is misleading or deceptive, or otherwise in breach of some other provision of the TPA. What is necessary is to show that the conduct is so unacceptable that it can properly be described as “unconscionable”. Normally it might be expected that behaviour would only be “unconscionable” if some moral fault or responsibility is involved. Normally it might be expected that this would involve either a deliberate act, or at least a reckless act. Mere unreasonableness or unfairness may not be sufficient, at least in the absence of some moral fault. This is why it was critical to the conclusion he reached in Simply No-Knead that Sunberg J was able to find an “overwhelming case of unreasonable, unfair, bullying and thuggish behaviour”. Of course, those words are not a definition of “unconscionable”. But having made that finding it is quite apparent that the behaviour could properly be characterised as “unconscionable”. ¶17 Taking appropriate guidance from the TPA and ACL cases, it is first necessary for a hirer under s 30(1) to “engage in conduct”. Unlike in the former TPA, in s 4(2)(a) of the CCA there is a definition of “engage in conduct” which includes “doing or refusing to do any act”. I consider that such a definition provides some assistance and is generally consistent with the ordinary and natural meaning of the phrase to “engage in conduct”. I therefore propose to adopt this approach for present purposes. Also, for the purposes of ss 30(2) and 31(2) of the OD Act, the Tribunal “may have regard to”, without in any way being limited by them, the various factors set out. This simply means the Tribunal may consider or take these matters into account: ACCC v Leelee Pty Ltd [1999] FCA 1121. ¶18 For the purposes of s 30, I also take guidance from the TPA and ACL cases as to the general notion of “unconscionable” as referring to conduct or behaviour that is not done in good conscience: ASIC v National Exchange Pty Ltd [2005] FCAFC 226. The courts have, in applying the terms of ss 21 and 22 of the ACL, attempted to describe unconscionable conduct in various ways. In Lexis Nexis Halsbury’s Laws of Australia (at 7 January 2015) “(C) Unconscionable Conduct” [100-263] it is observed that: Judges have described unconscionable conduct under section 21 of the ACL as ‘serious misconduct, something clearly unfair or unreasonable',17 ‘[s]howing no regard for conscience; irreconcilable with what is right and reasonable',18 revealing ‘a high level of moral obloquy’,19 being conduct ‘of such a type as to be deserving of significant moral opprobrium’.20 It follows that mere unreasonableness or unfairness is unlikely to be sufficient, at least in the absence of some moral fault.21 Mere reliance on the terms of a contract,22 or a mere breach thereof,23 cannot, without something more, therefore constitute unconscionable conduct; a contravention requires some circumstance other than the mere terms of the contract itself that renders reliance on, or breach of, those terms unconscionable.24 Similarly, debt collection processes, including the threat of proceedings, are not of themselves unconscionable (including when carried out by a debt collector), but may traverse into unconscionability where they involve false assertions.25 In each case, the relevant conduct against conscience must be assessed by reference to the norms of the society in issue,26 which conduct is not divorced from the context wherein it occurs.27 ¶19 Additionally, whilst it is made in relation to s 20(1) of the ACL, I consider some regard can be had to the following commentary in Lexis Nexis Halsbury’s Laws of Australia (at 7 January 2015) “(C) Unconscionable Conduct” [100-260] when considering the conduct of the parties in this case. It is said: In any event, consistent with the ‘unwritten law’, there can be no finding of unconscionable conduct in this context where the parties are experienced operators, accustomed to making commercial judgments, and acutely aware of their own interests and how to advance them.12 A distinction exists between parties who adopt an opportunistic approach to strike a hard bargain and those who act unconscionably.13 ¶20 As to the requirement imposed on the parties to negotiate “fairly and in good faith” under s 6 of the Code, no definition is included in the Code in relation to these concepts. However, given that s 6 applies to the negotiation, variation or termination of an OD contract, I consider that the relevant contractual principles in relation to what has become regarded as the “duty of good faith” can provide some assistance. In short, in appropriate cases, this principle imposes a general obligation on parties to a contract to act fairly and reasonably: Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234 per Priestley JA at 268. Importantly, and as is recognised in s 6(1) of the Code itself, this does not mean that a party cannot act in its own self-interest: South Sydney District Rugby League Football Club Ltd v News Ltd (2000) 177 ALR 611. ¶21 In terms of remedies, on a finding of unconscionable conduct by a hirer or an owner-driver under ss 30 or 31 of the OD Act, the Tribunal has a broad range of powers available to it under s 47(4). These include damages (including exemplary damages), and orders in the nature of mandatory or prohibitory injunctions. ¶22 Having set out what I consider to be the approach to s 30 to adopt in this case, I now turn to consider the evidence. [The tender] ¶23 Tenders in both commercial and government enterprises are common place and a normal part of doing business in the acquisition of goods and services. In contractual terms a tender is generally no more than an offer by the tenderer to the person who called for tenders, as offeree, which the offeree may accept, but is not generally obliged to do so: Meudell v Mayor of Bendigo (1900) 26 VLR 158; Spencer v Harding (1870) LR 5 CP 561. As to whether a particular tender process itself gives rise to contractual obligations will turn on its own facts: Hughes Aircraft Systems International v Air Services Australia (1997) 146 ALR 1 citing Pratt Contractors Ltd v Palmerston North City Council [1995] 1 NZLR 469. It was not argued by the applicants in this case and I am not in any event persuaded that the tender process resulted in contractual obligations as part of that process, prior to the award of cartage contracts. It also appeared to not be in dispute that the applicants are experienced operators in the transport industry and the tendering process was not something foreign to them. ¶24 Mr Della was a contractor to Sims for about 12 years. He operates the business Lark Hill Transport Pty Ltd. Mr Della described the system of contracting between him and Sims based on loading scrap metal onto ships and various locations throughout the State. A subcontract agreement was prepared for each ship. Its terms specified the ship to be loaded, the approximate tonnages and the date of the start and finish of the loading operations. It seemed to be common ground that the work involved long working days with an early start and often a late finish to ensure a ship was loaded prior to sailing. Whilst Mr Della testified that he signed the first few subcontract agreement documents, he did not sign them all the time. The same system of work continued however. Mr Della did understand that this system, following a case heard by this Tribunal, meant that each ship loading operation represented a separate contract and that Sims was able to terminate the engagement after each ship loading job. ¶25 Mr Della referred to a meeting with Mr Brackstone of Sims, in about March 2015. Mr Brackstone told the drivers present that Sims was looking to tender all of the transport services work out. He referred to the fall in the price of scrap metal and Mr Della acknowledged this was clearly a factor for Sims. Mr Brackstone also referred to the need to look for better ways to undertake the work. Mr Della said that some safety issues were raised by some of the drivers in the course of the meeting. Also raised and discussed, was Sims’ proposal to relocate a loading point from Fremantle to the Kwinana Bulk Terminal. This presented some issues in relation to access by “pocket road trains” in particular. ¶26 A little later in April 2015, Mr Della testified that he received a request for tender document from Sims. Mr Della said that he prepared a tender based on the invitation that he received. A copy of the request for tender was exhibit A2. Mr Della said that he still saw some problems with the operation in relation to demurrage; possible overloading and some other safety concerns, which he considered had not been resolved by that time with Mr Brackstone. Also, Mr Della noted that under the request for tender, Sims was no longer going to be responsible for damage to owner-drivers’ plant and equipment or tyres. He accepted however, as did all of the applicants, that part of the tender approach they adopted was to lodge tenders on the same terms and based on their current rates. ¶27 The current rates were set out in exhibit A1. This was said by Mr Della and others, to be because of some of the problems previously mentioned to Mr Brackstone regarding access to the Kwinana Bulk Terminal and other issues. A copy of Mr Della’s tender was exhibit A3. In addition to the current rates for haulage of scrap, Mr Della also included costs for demurrage and price escalation by CPI movements, in addition to a fuel levy to apply from time to time. Mr Della understood that Sims intended to award contracts for three years, which was better than the ship by ship arrangements then in place. ¶28 After submitting his tender, Mr Della testified that Sims requested he tender again, but on the basis of cartage rates per tonne only. This time, Mr Della said he made no provision for demurrage or damage to equipment and removed the reference to the transporting of empty bins from Bunbury to Perth, which was in his first tender. In other respects, after discussing the matter with the other applicants, Mr Della decided to leave the quoted rates the same as in the first tender. His second tender dated 29 June 2015, was exhibit A5. The letter of request from Sims for contractors to re-tender was exhibit A4. Mr Della’s second tender was attached to an email he sent to Mr Brackstone which in part said: Hi David, please find attached rates as requested ,based on current operational procedures and no rate rises in the past 12 yrs. I am happy to leave rates as they are and review them when the new yard is operational. Based on figures of the last six boat (sic) that we have done these rates are only marginal when you take into account of the hours spent doing them, damage to trailers and tyres ,the last damage bill to my truck that was damaged by DODDS was $24,000 which they payed (sic) I can understand that cost (sic) have to be cut to make a profit these days, but there is a bottom line to every thing and talking for myself i can not justify working and sleeping in a truck for 24 hrs a day and see nothing for it is just not good business in my book So if 12 years of reliable service doesn't count for any thing then i don't know what is thank you for reading this any way ¶29 Shortly after submitting the second tender, Mr Della testified that he heard from another applicant, who he thought was Mr Ninnis, that Mr Brackstone had mentioned that if those owner-drivers who had yet to be successful in being awarded a contract, reduced their cartage rates by 10%, they would “be in the ballpark” with their tenders. Some discussion took place amongst the drivers, including the other applicants. On the strength of this comment said to have been made by Mr Brackstone, Mr Della testified that he did drop his rates “a bit” but not by a full 10%. ¶30 Mr Della submitted his revised third tender on rates of cartage only, by email of 2 July 2015, a copy of which was exhibit A6. After this revised tender was lodged with Mr Brackstone, Mr Della said that he did not hear further from Sims. No one from the company spoke to him about his revised prices in particular. Not long after this, Mr Della received a letter from Sims dated 16 July 2015, informing him he was not successful in the award of a contract. A copy of this letter was exhibit A7. In relation to his third tender, Mr Della testified that he put in what he regarded as his “best price”. He did say however, that there was room for discussion with Sims if necessary. ¶31 Mr Leonardus Van Dongen operates Van Dongen Haulage Pty Ltd and has performed services for Sims for about eight years. He testified that in initial meetings with Mr Brackstone in March and April 2015, Mr Brackstone made the point to those present that because of the economic situation facing the business, Sims had to seek a reduction in rates for its transport services. In these discussions, Mr Van Dongen confirmed, as was stated by Mr Della, some ongoing safety issues were raised. Additionally, Mr Van Dongen also confirmed that access issues to the Kwinana Bulk Terminal by road trains was also a topic of discussion. Mr Van Dongen was of the view that because of this issue in particular, Mr Brackstone seemed to agree with the owner-drivers then present that it may be best to resolve the access issue to the Kwinana Bulk Terminal prior to Sims going out to tender for transport services. ¶32 When the request for tender was received not long after, Mr Van Dongen said he discussed it with the other owner-drivers. Mr Van Dongen proposed to submit the existing prices, as set by Sims, in his tender. He said that the decision by Sims to go to tender and the tender process was not new to him, as he saw it as a part of doing business. Mr Van Dongen testified that his tender was based on what he considered to be safe and sustainable rates. He acknowledged that the owner-drivers had an option not to tender for work, if he considered this was not so. Mr Van Dongen also testified that he did not seek any clarification from Sims as to aspects of the tender itself. ¶33 As with Mr Della, Mr Van Dongen referred to receiving exhibit A4 from Sims, being the request for a revised tender on rates per tonne only. Again Mr Van Dongen discussed this development with Mr Ninnis and others. A decision was taken, according to Mr Van Dongen, to maintain the existing rates. A little later, when Mr Van Dongen heard the same rumours referred to by Mr Della about price, and following a discussion with his brother, who is the principal of L & R Cartage Contractors, another applicant in these proceedings, Mr Van Dongen decided to put in a revised tender to reduce his rates. This was based on what he was told by his brother that a 10% reduction was “about where tenderers needed to be”. ¶34 Subsequently Mr Van Dongen confirmed also receiving a letter from Sims, informing him that his tender was not successful. ¶35 Mr Smith is the principal of Maranatha Transport. It has provided services to Sims for about 13 years. The business operates a pocket road train with a bogie, two trailers and a dolly. Mr Smith confirmed the rates provided by Sims in accordance with the contract document (exhibit A1) but said that he had not signed these documents on each occasion over the last six months or so. Reference was made by Mr Smith in his evidence to a meeting between the owner-drivers and Mr Brackstone at the “Blackpatch” at the wharf. Mr Brackstone told the group that there was a need for some changes including a reduction in prices. In relation to a tender proposed, Mr Smith said Mr Brackstone told those present that the lowest tender would not necessarily get a contract. According to Mr Smith, Mr Brackstone also said that he wanted to keep existing drivers. ¶36 As with the other applicants, Mr Smith said that access issues for pocket road trains at the Kwinana Bulk Terminal were a topic of discussion, as were some safety and loading issues. ¶37 A further meeting took place shortly after, between the applicants and Mr Brackstone, after which Mr Smith thought that the tender may not go ahead until later, possibly in July 2015, because of the matters that had been raised earlier. However, Mr Smith then received the request for tender from Sims. He submitted his tender (exhibit A17) based on the then existing rates. A request for a re-tender was received by Mr Smith as for the others (exhibit A4). Mr Smith responded with his second tender (exhibit A18) as with the others, Mr Smith included the same rates per tonne as in his first tender. While Mr Smith testified that he did discuss his tender responses with the other applicants, he said he did not know what rates they had proposed. Mr Smith agreed that based on the rates submitted, it would be reasonable for Sims to conclude that they were his most competitive rates for the work to be performed. Despite this, Mr Smith also accepted that because of the first two tenders, he may have been in trouble. He should put in a revised third tender, containing a reduction of rates by about 10%, as was suggested by Mr Brackstone, so he could be more competitive. ¶38 The final witness for the applicants was Mr Ninnis. He has conducted business with Sims for about six or seven years as Chang Transport and Scrap Metal Pty Ltd. Mr Brackstone informed him along with the other owner-drivers of the need for a “cut” and that there would be a tender. A little later, Mr Ninnis spoke to Mr Brackstone and requested a meeting between him and the other applicants, which included another owner-driver. Mr Ninnis confirmed that a range of issues were discussed with Mr Brackstone including some safety matters and access to the Kwinana yard by pocket road trains. The proposed tender process was also mentioned, including whether there would be guaranteed tonnages and what the situation was with respect to demurrage. Mr Ninnis said that he thought, along with the other applicants, that the proposed tender might be delayed. Mr Ninnis also made reference to the contract document for each ship loading job (exhibit A1). Mr Ninnis said that he used to sign these each time but stopped doing so after the Louisville Holdings case. ¶39 Once the Sims tender document was received (exhibit A2), Mr Ninnis said that he considered there was not sufficient information provided on which to properly base his proposal. He referred to there being no minimum tonnages specified; the issue of the problem of access to the Kwinana Bulk Terminal and whether one or two trailers were to be used, amongst other matters. He discussed the request for tender with the other owner-drivers. It was decided because of these various concerns, to submit tenders based on the current rates paid by Sims. This was so despite Mr Ninnis accepting that no minimum tonnages were specified under the previous ship by ship system. Under the former arrangements, no demurrage was payable either. As to this, Mr Ninnis also accepted that by the inclusion of matters such as demurrage in Sims’ request for tender, that this did represent an improvement. Mr Ninnis did lodge his tender which was exhibit A22. In doing so, he also noted that Sims would no longer be responsible for damage caused to equipment such as tyres etc. Mr Ninnis did however accept that in total terms, the rates that he proposed, plus other charges would represent an overall greater cost to Sims than under the existing rate per tonne system. ¶40 As with the other drivers, Mr Ninnis said he received a request for a second tender from Sims, but on a rate per tonne only. He spoke to Mr L Van Dongen who informed him that based on a previous discussion Mr Van Dongen had had with Mr Brackstone, Sims wanted the owner-drivers to submit an “all in” rate, including an allowance for demurrage etc. Mr Ninnis did so and revised his tender, which was in fact higher than his first tender, to take into account the inclusion of demurrage. ¶41 A short time later, Mr Ninnis said he spoke with Mr Brackstone in Sims’ yard. Mr Brackstone told him that he was awarding tenders at about 10% less than current rates. According to Mr Ninnis, Mr Brackstone told him that he was doing “round table deals” with other people. Mr Brackstone told him that if he dropped his rates by 10% he could possibly get a contract. About six to eight jobs were left to be awarded. Mr Ninnis did so and submitted his further revision as exhibit A23. He was then informed by Sims by letter that he was not awarded a contract. ¶42 Mr Brackstone is the Western Australian Operations Manager for Sims. He is responsible for owner-drivers and Sims transport operations. He outlined the background to the tender process undertaken by Sims. A central factor in its decision to put its transport services out to tender, was the significant fall in the price of scrap metal and a need for Sims to reduce its costs. Sims wanted to “test the market” on price, but also to introduce greater continuity for the work of owner-drivers, by offering contracts on a three year basis. ¶43 Mr Brackstone referred to the first meeting that he called with the owner-drivers on the wharf. He told those present that it was Sims’ plan to put the transport work out to tender and explained the reasons for it. A few weeks later Mr Brackstone said that he met again with some owner-drivers which included the applicants. Some issues were raised with new sites being developed by the company and in particular also, access to the Kwinana Bulk Terminal by road trains as this location is single trailer access only. Mr Brackstone said he understood that all of the applicants did have a single trailer. The drivers raised with him the issue of pricing for tenders, given that there were at that time several unknowns. They also raised some safety issues involving matters such as fatigue management, as was commented on by the previous witnesses. ¶44 As to these particular matters, Mr Brackstone acknowledged that there were some areas of uncertainty, but took the view that all of the owner-drivers were facing the same situation, not just the applicants. He further said that other owner-drivers also spoke to him about some of these issues at other times. Mr Brackstone said that some of those particular drivers, who did raise these issues with him, subsequently were awarded contracts. In relation to the possible deferral of the tender process, Mr Brackstone said he considered the issues raised by the owner-drivers including the applicants. After he had met and discussed the matters with them, he had a meeting with the general manager of Sims and discussed the issues at some length with him. On the basis that all of the owner-drivers would have the same information on which to base their tenders, Mr Brackstone said a decision was taken by the company to proceed with the tender process. ¶45 In response to the initial 29 invitation to tenders sent out, Mr Brackstone said the company received 29 responses. All those who responded received exactly the same information. In particular, Mr Brackstone referred to the option available for owner-drivers to tender on the basis of multi-truck contracts as one that Sims was keen to consider. Mr Brackstone confirmed that Sims had no problems with the work of the existing owner-drivers and was quite happy for them to continue providing services under the revised arrangements. ¶46 In the case of the first round of offers, Mr Brackstone testified that 10 contracts were awarded at that stage. These contracts were won on the basis of lowest price. These prices set a benchmark for subsequent tenders. One comment Mr Brackstone made at the time of receiving the applicants’ tenders, apart from pricing, was they were all virtually identical. These tenders followed his separate meeting with them as a group. From this, Mr Brackstone formed the view that this particular group may be colluding on their bids. ¶47 As to the second tenders, Mr Brackstone testified that given the information Sims had provided to the owner-drivers and the invitation to tender on price only, he expected the applicant’s tender prices to be lower. However, their tender prices remained unchanged. Mr Brackstone testified that he noticed that the applicants’ second tenders were also largely the same. ¶48 Some time later, Mr Brackstone said that he spoke to Mr Ninnis in the car park at the Sims Spearwood yard. He said that Mr Ninnis asked him what the applicants had to do to be successful in their tenders. Mr Brackstone indicated to Mr Ninnis that they were about “10% off the current rates”. This was said to provide a “ball park” where the rates needed to be but that no guarantees were able to be given. Mr Brackstone said that he then received the third tender from the applicants. In the case of Mr Della and Mr Smith, with one minor exception, as set out in exhibits A6 and A19, again, both were the same. This applied to the other applicants’ tenders as well. Mr Brackstone took the fact that all of the tenders from the applicants were the same, demonstrated to him that they were not prepared to differentiate themselves on price. Whilst he acknowledged that the applicants did largely reduce their rates by 10%, he said this had occurred very late in the tender process. ¶49 In terms of the overall process, Mr Brackstone said that only a certain number of contracts were able to be awarded. There were not enough positions available to appoint all 29 owner-drivers. When it was put to him that one of the successful tenderers had rates in their tender substantially the same as for Mr Smith (see exhibits A19 and R2), Mr Brackstone said while this was the case, he considered that the successful tenderer had shown a greater willingness to negotiate than any of the applicants had. He said he reached this conclusion as a result of the dealings he had with both groups of drivers and individual owner-drivers, throughout the tender process. ¶50 Mr Brackstone denied that one of the purposes of Sims was to no longer have the applicants as part of its business. He said at one point, he offered Mr Ninnis a position as an employed driver to operate Sims’ trucks. Mr Brackstone was not sure whether this was before or after the tender process took place. He also testified that Sims would have no difficulty in re-engaging any of the applicants at some time in the future. [Consideration] ¶51 Based on the evidence, the Tribunal is satisfied that each of the applicants was an owner-driver for the purposes of s 4 of the OD Act in that they, as either natural persons or as officers of a body corporate, carried on the business of transporting goods in one or more heavy vehicles (as defined in s 3 of the OD Act) supplied by that person or body corporate as the case may be. I am also satisfied on the evidence that the arrangements between the applicants and Sims constituted owner-driver contracts for the purposes of s 5 of the OD Act and therefore the Tribunal has jurisdiction to deal with the applications. ¶52 Whilst it might be said, as was indeed conceded by counsel for Sims, that aspects of the tender process could have, in retrospect, been done differently, for the following reasons, I am not persuaded that it has been established that Sims engaged in unconscionable conduct as claimed. Nor am I persuaded that Sims acted contrary to the Code obligation to negotiate with the applicants in good faith. ¶53 The invitation to tender of 20 April 2015, issued to the owner-drivers by Sims (exhibit A2) set out in some detail the conditions of the proposed tender. Importantly, in the first paragraph, owner-drivers were informed of the request by Sims for “competitive pricing for contract transport services for Sims Metal Managements (Sims MM) Western Australian Operations”. It is clear that the tender was based on competitive principles. The invitation to tender also needs to be considered in the context of the evidence as to pre-tender discussions held between Mr Brackstone and the owner-drivers. There is no doubt on the evidence, that the owner-drivers, including the applicants, were informed by Mr Brackstone, that a key requirement of Sims, because of the downturn in the scrap metal market, was reducing costs. An obvious corollary of this was reduced pricing by the owner-drivers. ¶54 Secondly, in the second paragraph of the invitation to tender, it was also made clear that pricing is to be based on an owner-driver’s capability. Importantly, it was specified that “suppliers are not obliged or required to submit pricing on the full scope of works.” Thus, it was open to all owner-drivers to submit tenders based on their operational structure. This could include only tendering on part of the scope of works, if that was most suitable to their operations. Furthermore, there was no limitation on the extent to which any proposed tender could be qualified, having regard to some of the unresolved issues prior to the submission of tenders, which was the subject of evidence. Indeed, the applicants did qualify their tenders in relation to the issue of access to the Kwinana Bulk Terminal. ¶55 In relation to both the first and second tenders, despite the very clear indication both in the tender documents themselves and in direct discussions with Mr Brackstone as to competitive pricing, the applicants maintained the then existing rates in their tenders. Additional proposed charges for demurrage and other matters were also specified. On the evidence, it is open for the Tribunal to conclude that the applicants considered this course to be in their commercial interests. What they respectively submitted as their bids was based on what they viewed as safe and sustainable rates, in the context of their business operations. In a competitive tender process, that was entirely their prerogative and no criticism is suggested by this observation. ¶56 Whilst some of the owner-drivers, including the applicants, expressed reservations about the extent of information available upon which to base tender proposals, at that stage of the process, the applicants were in no different position to all of the owner-drivers tendering for services to be provided to Sims. There could be no suggestion that at that point the applicants were being singled out or being treated differently to any other group of drivers who were seeking contracts through the tender process. ¶57 In relation to the significant issue of price, the fact that Sims was seeking to reduce the cost of transport services, in the context of prevailing economic conditions in the scrap metal market, was again, no more than Sims seeking to act in accordance with its commercial interests. In my view, there can be no suggestion that in doing so, Sims was seeking to act unfairly or unconscionably, or that it failed to act in good faith. On the contrary, on all of the evidence before the Tribunal, Sims made it abundantly clear both in the written tender material and in the pre-tender discussions with owner-drivers, that pricing would be an important issue. ¶58 By the time that the applicants, along with other owner-drivers, were invited to submit a third tender, the process was very well advanced and nearing its conclusion. In relation to the applicants specifically, it was quite clear on the evidence that by about this time, the applicants were concerned that they had not been competitive in the tender process up to that time. They thought they would miss out on contracts. Given that they had not been prepared up until that time to alter their prices, that conclusion would seem almost self-evident, when taken in the context of all of the evidence. ¶59 In my view, in the context of a competitive tender process, there was no obligation on Mr Brackstone to tell the applicants that to be “in the ballpark” their rates needed to be reduced by approximately 10%. Sims could simply have had no further communication with the applicants and invited them to again tender on the basis of their best prices per tonne. In giving such an indication, Sims was providing the applicants a very clear signal as to the competitiveness of their position at that time. Mr Brackstone’s evidence was that whilst he acknowledged that at that third and final stage of the tender process the applicants had indicated some willingness to negotiate with Sims, he regarded it as very late in the day and at the end of the process. In my opinion, based on the previous approach of the applicants, that conclusion was reasonably open. ¶60 Simply because the applicants had elected to take up Mr Brackstone’s suggestion and, in an endeavour to not miss out on contracts completely, finally reduce their rates, did not oblige Sims to award any or all of the applicants with a contract. Mr Brackstone plainly provided that assistance to at least give the applicants a competitive opportunity. As Mr Brackstone said, there were not enough contract positions on offer for all of the owner-drivers to be successful. ¶61 As to the issue of the relative strengths of the positions of the parties, for the purposes of s 30(2)(a) of the OD Act, I am not persuaded that such a factor is positively in favour of the applicants in this case. Whilst there was evidence that four of the five applicants did not continue to sign the individual contracts for each ship loading operation, following the Louisville Holdings case, in substance, the nature of the contracting arrangements was no different to those found by the Tribunal to apply in Louisville Holdings. In my view, the act of simply not signing a document, after initially doing so, but with no change in the modus operandi, would be a victory of form over substance. I maintain the view that the conclusions reached in Louisville Holdings, would apply in the circumstances of these matters. ¶62 I therefore do not consider there was any obligation on Sims to offer fresh engagements to the applicants. Taking everything into consideration, whether or not the applicants were successful in the tender process, would have put them in the same position as if Sims had not offered any further engagements under the former contracting system. I therefore do not consider that the applicants were in any position of disadvantage or that Sims was in any superior bargaining position. This may have been a factor, if the evidence established that the applicants were engaged on long term or ongoing contracts, and Sims was merely exercising its bargaining power unreasonably to reduce its rates. This however, was not the case. ¶63 Moreover, the contracts being offered were of material advantage to the owner-drivers, they being contracts providing for some stability over a three year term. Additionally, the tender process involved somewhat of a reversal of the usual order of working in the past. Under the former arrangement, the owner-drivers were price takers. In the case of the tenders, they were price setters and were invited to submit competitive bids in accordance with their operations. ¶64 As already noted earlier in these reasons, it is also not to be disregarded in the context of the bargaining positions of the parties, that the applicants are experienced transport operators. They have been conducting their own transport businesses in some cases, for many years. It was clear that the steps taken by the applicants in relation to the tender process were very much based on the applicants’ assessments of their respective commercial interests. This involved what they considered were safe and sustainable rates in the provision of services. ¶65 Whilst the applicants raised the issue of multiple contracts being considered favourably by Sims, and submitted that this was not made entirely clear at the commencement of the process, again the applicants were in no different position to any other owner-driver in this regard. This criticism I consider falls into the same category as my earlier observations as to the provision of relevant information to proposed tenderers at the commencement, and whether the process itself could have been done differently. Again, unless the applicants can establish that they were in some way singled out and treated less favourably, and manifestly unfairly, it is difficult to see how a conclusion can be reached that on the strength of a factor such as this, Sims engaged in unconscionable conduct. Similar observations may be made in relation to the suggestion that demurrage costs be included in the all up per tonne rate. ¶66 As to the contention of the applicants that they were in some way “singled out” because they had raised safety issues in the past, in my view, such an inference cannot be reasonably drawn on all of the evidence. Mr Brackstone’s testimony that he had no difficulties with the work performance of any of the applicants was not in any way seriously challenged. Moreover, his offer to employ Mr Ninnis directly is inconsistent with any suggestion that Sims were intending to “get rid” of the applicants for any particular reason, including this reason. ¶67 Furthermore, the contention of the applicants that despite their willingness to negotiate, Mr Brackstone treated them unfavourably cannot be sustained in my opinion. Mr Brackstone’s evidence was that it was only in the final stages of the tender process, after he had informed Mr Ninnis that to be competitive the applicants’ rates needed to be reduced by about 10%, that the applicants did so. Mr Brackstone testified that he had regard to the approach of individuals and groups throughout the entire tender process in making his decisions on the awarding of contracts. In the context of a competitive tender, Sims was entitled to take these matters into account. Importantly also, despite there being no obligation on Mr Brackstone to provide the indication he did to Mr Ninnis, it could only be regarded as fair dealing that he did. However, this was done on the proviso that there were no guarantees and it may only lead to a possibility of the award of a contract. ¶68 Given that on two out of the three opportunities to tender, the applicants had declined to adjust their rates at all, and submitted what where essentially identical tenders, it was in my opinion, open for Mr Brackstone to weigh this factor in the balance as to whether contracts should be awarded or not. In terms of ss 30(2)(g) and (j) of the OD Act, Sims was well able to conclude at an advanced stage in the tender process, that the applicants were acting in their own commercial interests. They continued to submit proposals on the basis of what they saw as safe and sustainable rates. In a competitive tender process, in my view it was open for Sims to select those bids from bidders considered most advantageous from Sims’ perspective. ¶69 Whilst Sims were criticised for engaging with Mr Ebbett in relation to his tender, and suggested that this showed bad faith, I am not persuaded to this view. This allegation may, in addition to the heads of s 30(2) referred to above, involve consideration of s 30(2)(f). While I accept that Mr Brackstone did say that he did engage with Mr Ebbett and offered him a contract, he formed the view that he was more willing to negotiate on price. Based on the previous tenders submitted by the applicants, Mr Brackstone preferred to engage with Mr Ebbett. This does not mean that in doing so, Sims acted without any regard for moral behaviour or engaged in serious misconduct, in the sense in which those phrases are referred to in the authorities dealing with unconscionable conduct. Mr Brackstone was not obliged to engage with the applicants with a view to awarding them a contract. ¶70 I also note in relation to Mr Ebbett, that he had provided some 31 years of service to Sims and his son had some 11 years of service. This is not consistent with Sims trying to remove older owner-drivers through the tender process, even if this could be regarded as a relevant consideration, which, for the reasons I have stated above as to the status of the contracts, it is not. ¶71 While each case will necessarily turn on its own facts, the circumstances of this case can be distinguished from one where, for example, there are only two major bidders in a contractually binding tender process and the conduct of the party seeking the bids engages in a breach of that contract by failing to evaluate in accordance with strict methodologies; by failing to observe strict confidentiality provisions of tenderers’ proposals; and accepting out of time changes by the successful party all to the significant detriment of the losing bidder; along with various contraventions of the TPA: Hughes Aircraft Systems at 118-119. [Conclusion] ¶72 Having regard to all of these factors, and all of the evidence, whilst I readily appreciate that the applicants were disappointed in not receiving contracts, I am not persuaded that Sims engaged in unconscionable conduct or contravened its obligation to negotiate in good faith. I do not consider that Sims’ approach to the applicants’ tenders demonstrated “serious misconduct” or conduct involving some “moral fault” or “overwhelmingly unreasonable behaviour”. ¶73 Accordingly, the applications must be dismissed.