Municipality of Mansfield ordered to pay $108,360 to waste collection company

Municipality of Mansfield ordered to pay $108,360 to waste collection company

On August 13, the Quebec Court of Appeal upheld a previous judgement and ruled against the Municipality of Mansfield-et-Pontefract, ordering it to pay $108,360 to Location Martin-Lalonde Inc., a local contractor that bid on the town’s waste collection contract back in 2015. The amount reflects damages for unrealized profits after another company was awarded the 5-year contract following a public tender process. This latest ruling upheld a January 2023 decision by a superior court judge, which ruled that Lalonde’s submission should have been deemed admissible, despite a “minor irregularity”, as the company that won the contract was found to have a non-compliant bid.

The full decision by the Court of Appeal is available here.

Mansfield Mayor Sandra Armstrong declined to comment on the case. Location Martin-Lalonde Inc. declined to comment on the record to CHIP 101.9.

Background

In October 2015, the municipality issued a call for tenders for the collection of municipal waste and recyclables. The only other bidder was Entreprise R. Charette. After the contract was awarded to Charette, Lalonde attempted to secure the bidding documents from the municipality and was refused. In March 2016, Lalonde contacted the Commission d’accès à l’information du Québec to access the documents, securing them from Charette in October 2017. In June 2018, they filed in Quebec Superior Court for the $108,360 in damages.

The call for tenders specifies that the bidders must submit a $5,000 bid guarantee, as well as a letter of commitment from a financial institution guaranteeing a $5,000 performance bond. While Lalonde’s bid contained a $5,000 cheque for the bid guarantee, it did not contain the letter of commitment. The call for tenders states that the bidder has 15 days from the awarding of the contract to replace their bid guarantee with their performance bond.

The initial decision in 2023, by Superior Court Judge Jean Faullem, ruled that since Charette’s bid did not meet the requirements of the call for tenders, it should not have won the contract.

“[T]he acceptance of Entreprise Charette’s bid represents, on the part of the Mansfield elected officials of the era, a total lack of respect for the principle of equality between bidders,” it states (translated).

It also ruled that a lack of letter clarifying that the $5,000 cheque submitted would also serve as the performance bond in the event of the contract being awarded, was a “minor irregularity”. While a municipality must reject a bid with major irregularities regarding an essential bid condition, it can exercise discretion when considering a bid with an irregularity deemed “minor”.

Appeal 

The municipality’s appeal argued that the judge made reviewable error in three respects: 1) that the irregularity in Lalonde’s bid was a minor one, 2) that Lalonde could claim damages despite the fact that their bid contained an irregularity, and 3) the amount of damages to which Lalonde was entitled.

The Court of Appeal dismissed the municipality’s appeal, finding no grounds to overturn the original decision.