AusRAIL, Market Sectors

Patrick, Toll still batting on arbitrator appointment

<p>Patrick and Toll are still exchanging messages over the identity of an independent arbitrator to decide on whether Patrick has a case against its Pacific National partner, Toll Holdings.</p> <p>The arbitrator is to be appointed within 30 days of Toll’s further rejection on Wednesday of Patrick’s efforts to start formal dispute proceedings between the two. </p> <p>Patrick claims that a take-or-pay linehaul deal between Pacific National and Toll’s Queensland forwarding arm Toll North has shortchanged the rail operator of up to $520 in revenue over 20 years. </p> <p>Toll said the matter is far smaller and does not warrant the triggering of the dispute and possible dissolution procedures that Patrick has now begun.</p> <p>Patrick has offered four suggested arbitrators, all retired QCs and in two cases, former judges, now acting as independent arbitrators. </p> <p>If the pair cannot agree on an arbitrator, then the president of the New South Wales Law Society will appoint one. </p> <p>Patrick is pushing to bring the Pacific National dispute to a head before Toll can win Australian Competition and Consumer Council approval of its takeover of Patrick, while Toll will move to slow the dispute process down.</p> <p>Meanwhile, FCL and Patrick have signed an exclusivity agreement which will preserve Patrick’s right to buy rail forwarder FCL until the end of next year. </p> <p>The deal will add to speculation of a long-term Patrick strategy to press on with its own integration of rail and forwarding operations, should both the Toll bid fail and the breakup of Pacific National remove ACCC objections to Patrick’s original deal to buy FCL last May. </p> <p>Patrick is thought to have offered $150m for FCL, and FCL managing director Bill Gibbins said at the time of the agreement that it was becoming harder for smaller operations to survive on the margins now earned in the land transport and logistics industries.</p> <br />