Contractor, province in $27M bridge work fight

Article content

An Ontario company with bridge construction contracts in Fredericton, Miramichi and Mactaquac is suing the government for $27 million, alleging it sets “unfair” standards for out-of-province operators that local companies aren’t subjected to because they have “close personal relationships with government inspectors and officials.”

In a statement of claim filed in the Court of King’s Bench, Julmac Contracting Ltd. (JCL) – which has contracts for Miramichi’s Centennial Bridge and Anderson Bridge, the Marysville Bridge in Fredericton, and for roadwork on the Mactaquac Dam bridge crossing – says it believes the standards are “seemingly designed to drive (it) out of the province.”

The different rules, JCL alleges, include higher standards for materials, designs, construction methods, and an “onerous” and ongoing approvals process that local companies don’t face.

None of the allegations have been proven in court.

Shalom Cumbo-Steinmetz, a lawyer for JCL, didn’t respond to a request for comment.

The province declined to comment on the case, but has signalled its intention to defend itself.

But while it wouldn’t discuss JCL’s specific allegations, the Department of Transportation and Infrastructure (DTI) did respond to a question about whether it sets, or ever has set, different quality and material standards for projects awarded to companies from outside New Brunswick compared to local operators.

“In New Brunswick, the public procurement process is governed by a legal framework comprised of the Procurement Act and Regulations, and various trade agreements,” spokesperson Jacob MacDonald said in an email.

“New Brunswick public sector entities must adhere to the principles of this legal framework by being fair, open and transparent with their procurement practices. All jurisdictions across Canada follow a similar model for public procurement which includes open competition for government contracts through a public solicitation process.

“The Department of Transportation and Infrastructure has standard specifications that apply to its projects.” 

JCL’s claim says that while the rules may be consistent, the enforcement of them isn’t.

That’s because, it alleges, the people working for local contractors “have close personal relationships with government inspectors and people who work at DTI and GNB (Government of New Brunswick).”

“There is no legal basis for this preferential treatment of the local contractors – it is not treatment that these contractors have a contractual right to receive under DTI’s standard construction contracts,” the filing reads.

“Instead, they receive this preferential treatment because GNB has chosen to favour them.”

The $27 million JCL is seeking includes about $19 million for lost profits, and “$8 million and rising in incremental costs” imposed by GNB.

At least one of JCL’s projects – a $7.1 million refurbishment of Fredericton’s Marysville Bridge – has blown its completion date by years, and isn’t expected to be finished until later this year.

When previously questioned about the delay, DTI offered a suite of answers, including weather delays and “supply chain issues.” There was never any mention about a dispute with JCL, but the province did mention it was in talks with the contractor.

Last year, Fredericton councillor David Hicks told Brunswick News that the Marysville Bridge work was causing lots of headaches for his constituents.

“People would just like to know what’s going on, and when it’s going to be done,” he said. “We all understand that delays happen, whether it’s the equipment or human error, it does happen. But I think an explanation is expected from the public.“

JCL also alleges it didn’t win a contract for work on a bridge in Florenceville because it didn’t submit the lowest bid. The company alleges its price wasn’t the lowest because “it priced and bid the work assuming it would have to comply with the design drawing constraints and restrictions, expressly required by DTI’s contract terms.”

“The local contractors who bid the same project knew that GNB would not require strict compliance with the DTI contract terms, and so bid a lower price, undercutting JCL’s otherwise competitive bid,” the filing reads.

The Higgs government has regularly promoted its efforts to award contracts to local companies, and developed a policy it calls “New Brunswick first,” which it describes as “a procurement strategy that ensures that goods, services, and construction services required by the government are procured from New Brunswick suppliers wherever possible while respecting trade agreements.”

“Last year alone, 90 per cent of government contracts were awarded to New Brunswick companies, New Brunswick suppliers,” he said.