Contractor Liable for Following Owner’s Flawed Specs
Appeal from the lower court decision in Greater Vancouver Water District v. North American Pipe and Steel Ltd., 2011 BCSC 3. The lower court held that the owner was liable for the cost of failed watermain pipe, because the owner had provided flawed specification in the tender package. Bidders simply constructed according to the specifications. The Court of Appeal overturned the decision finding that the bidder/contractor had a duty to bring the flawed design to the attention of the owner.
OpenCourt Vindicates Subcontractors Refusal
A dispute over extras and communications not responded to resulted in termination of a construction subcontract. The court upheld the subcontractor's right to refuse to do further work until the matter of the extra work was resolved, finding that the contractor's contract termination was improper.
OpenDebriefing at City of Abbotsford
With the evolution of public procurement towards a more collaborative and balanced process that recognizes the time that proponents have devoted to preparing responses, we are seeing a shift away from the ‘us versus them’ approach to debriefing. This article explores how one progressive municipality in the Lower Mainland of BC has transformed the process into a positive, respectful, and meaningful exchange.
OpenDeficient Documentation Leads to Mega Lawsuit
Yukon Supreme Court decision on claim filed by Mega Reporting Inc, an unsuccessful bidder on a Yukon Government RFP for court reporting services. At debriefing it became clear to Mega that the evaluation committee had no documentation supporting the evaluation process and was unable to satisfy Mega that the process was fair. The court considered the implications of an clause stating that bidders waive the right to claimed for damages, as well as the impact of government directives assuring the public that procurements would be conducted fairly. The Tercon 3 part test was considered, and the court concluded that the Directive was 'statutory in nature' and the government could not rely on the waiver clause, failing the 'public policy' prong of the Tercon test. Subsequent SCC decision found the waiver clause to be a complete defence for the Yukon Government.
OpenDefining Requirements - Steak v Spaghetti
The federal government issued a Request for Standing Offers for provision of air traffic control radio systems that was unclear whether UHF or VHF was required. Rockwell Collins bid provided pricing for equipment having both capabilities, and was unsuccessful. The company awarded the contract had proposed pricing for equipment with only VHF or UFH band capabilities and Rockwell Collins challenged that decision to the CITT. In finding that the government had ignored its own stated 'preference' for both capabilities and had included contradictory requirements on this point, the CITT found Rockwell's complaint valid and awarded them one half the profits they would have made.
OpenDefining Specs: Getting the RFX Right the First Time
PWGSC issued an RFP on behalf of the Department of National Defence (“DND”) for dry media blasting cabinets. Four bids were accepted, including one from Aerospace Facilities Group, Inc. (“Aerospace”), which was held to be compliant and was ultimately successful as the lowest-priced bidder – however, the other compliant bidder, Pauli Systems Ltd. (“Pauli”) expressed concern about the award as soon as it was issued. After several meetings and Stop Work Orders took place, the CITT accepted Pauli’s complaint that Aerospace was unable to supply the goods specified in the RFP, and PWGSC terminated the contract about three months after it had been awarded. Aerospace challenged the cancellation through complaint to CITT. CITT expressed concern about lack of clear specs but lacked jurisdiction as this was a contract management issue.
OpenDisclaiming Contract A in an RFP- Implications Under the Competition Act
The question addressed in this FAQ is "Does an RFP that specifically disclaims Contract A constitute a “call or request for bids or tenders” for the purposes of section 47 of the Competition Act?" Is it a 'competition' if there is no Contract A?
OpenDodging Defensible Documents Decried
A 2016 decision out of the UK highlights the international attention on fairness in procurement. This article outlines a myriad of fairness complaints lodged by an unsuccessful bidder to a procurement for the decommissioning of 12 different nuclear facilities in the UK, including acceptance of a non-compliant bid and manipulation of the evaluation process to achieve a pre-determined outcome. The court reviewed the allegations and found evidence of unfairness. Damages to be assessed in a separate proceeding, likely several hundreds of millions of dollars given the magnitude of the contract.
OpenDoes Consent to Disclosure in an RFP Override the FOI Exemptions? You be the Judge!
The terms of an RFP included the bidder’s consent to disclosure of all of its standing offer unit prices or rates. The owner then received a Freedom of Information request for relevant information related to the successful bidder. That bidder refused its consent to disclosure under third party exceptions in Freedom of Information legislation, notwithstanding the clear consent clause in the RFP. Despite consent, public owners have discretion whether circumstances militate against disclosure. Decision to withhold was remitted back to the owner for reconsideration. Consent to disclosure does not mean automatic disclosure.
OpenDoes Helicopter Procurement Case Expand the Reach of Judicial Review
Pre-tender bidder discussions revealed technical specifications for light lift helicopters. Airbus advised PWGSC to relax specifications, government refused. Airbus did not bid, but challenged the specifications as biased towards competitor Bell Helicopters. No remedy for breach of contract, so Airbus launched judicial review of the government's decision to not revise specifications. Court held that government decision was reasonable based on operational requirements.
OpenDoes Legislation Trump RFx Language
In tender for parkade removal the lowest bid was rejected as non-compliant with safety certification requirements. Contract award was made to a higher bidder, and the Claimant sought $25,000 in damages for breach of the implied duty of fair and equal treatment arising from formation of Contract A. In the Claimant’s view, its submission was compliant and ought not to have been rejected. Claimant failed to comply with legislation requiring COR certification letter, but the tender call did not specifically state this requirement. Consideration of whether tender information or legislation prevails.
OpenDoes One Bidder Owe Another Bidder An Implied Duty Of Fairness? You Be The Judge
LaPrairie Works and Ledcor were competing bidders on an RFP for a highway maintenance contract in Alberta. LaPrairie argued that Ledcor, the successful bidder on an Alberta government contract, had used improper means to obtain confidential information about LaPrairie’s operations, breaching its implied contract to treat fellow bidders fairly. In contrast to other jurisdictions, Alberta had not enacted “bidder conduct” legislation, and had not imposed a “fair and honest bidding conduct” requirement on all bidders in this RFP. There was no evidence that the bidders had agreed to such a requirement amongst themselves. the claim was dismissed.
OpenEnvoy Royal LePage and the Federal Government
This article examines lengthy litigation that ensued over the tendering by the federal government for relocation services for government personnel. Several consecutive contract awards came under scrutiny for what the Ontario Superior Court referred to as "reprehensible", "outrageous" and "shocking" misconduct by the government.
OpenFerries, Financial Incentives and Freedom of Information
A recent Nova Scotia court decision decided a Freedom of Information appeal in which disclosure of financial incentive information within this limited competitive field was a live issue. The Province refused to release the management fee information, asserting two exemptions to disclosure: third party commercial information supplied in confidence, and harm to financial or economic interests of a public body.
OpenFighting Against Force Labour
Canada's Fighting Against Forced Labour and Child Labour in Supply Chains Act came into force on January 1, 2024. Here's what you need to know.
OpenFirst Nations Blockades and the Duty to Inform
How far does the ‘duty to warn of known dangers’ extend? Can government be held liable for failure to warn logging companies of potential First Nations blockades? How far does the ‘duty to consult’ extend? What are a contractor’s rights when working in First Nations’ territory? Is government liable to ensure unimpeded access? These are among the issues addressed in a 2015 B.C. Court of Appeal decision that relied on many of the most recent pivotal cases we have covered in The Legal Edge.
OpenFOI Legislation: The Cost of Doing Business with the Public Sector
Article discussing the legal tests and practical application of the Freedom of Information legislation in Canada, as it relates to release of information by public procuring entities. Implications for private sector bidders and contractors.
OpenFreedom of Contract and Public Policy Considerations Collide – Again
The Yukon government had insufficient documentation of the RFP evaluation process conducted for a court reporting services contract, and Mega Reporting Inc, an unsuccessful proponent initiated a claim in the Yukon Supreme Court. That court ordered damages payable to Mega, refusing to allow the government to be shielded by a broad exclusion of liability clause. The Yukon Court of Appeal overturned the decision, setting aside the damages award and dismissing the claim, with costs payable to the Yukon government. The SCC refused to hear an appeal of this decision by Mega Reporting. For the lower court decision, see "Deficient Documentation Lead to Mega Lawsuit"
OpenGaming RFP in Ontario – Was the Deck Stacked Against a Bingo Hall?
Wauzhushk Onigum Nation (WON) sought judicial review of Cabinet’s and OLG’s decisions to issue a public tender, to bundle the gaming zones, and to enter into the asset and operating agreements. Essentially, WON argued that it expected OLG to accept WON’s proposal to convert Golden Eagle into a casino, and that damages flowed from the non-fulfilment of that expectation. Its main arguments were breach of procedural fairness and the duty to consult First Nations. No challenge to selection or fairness of the tendering process. The court ruled that it had no authority to review a Cabinet decision – absent abuse of power or bad faith. During all stages – RFI, RFPQ and RFP – OLG consulted with WON as one of many stakeholders, which was sufficient to satisfy the low threshold of procedural fairness owed. No duty to consult was owed, claim dismissed.
OpenGood Faith Obligations and Contract Renewals
One of the first cases to rely on the Bhasin v Hrynew Supreme Court of Canada decision concerning they implied obligation to act in good faith in contracting. This case concerns the obligation to negotiate renewal rates in good faith. The Court focused on the express obligations in the contract rather than the implied obligation arising from Bhasin but did consider and discuss that case at some length. The facts are remarkably similar. According to the Court, an honest and reasonable approach to TimberWest’s obligation to perform the contract and negotiate the rates in good faith would “require that the defendant not put a strategy to terminate an agreement for a collateral benefit ahead of a good faith attempt to fulfill the agreement."
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