Does not apply.
At the federal level, remedies are available under the relevant Trade Agreements for breach of Canada's obligations therein, and remedies are generally available under contract law and the common law on bidding and tendering for breach of the GCRs, breach of the legal duties attached to government procurement in Canada, and breach of the rules of procurement in a particular federal government procurement process.
A supplier that seeks to challenge a provincial government procurement process is generally limited to suing under the common law of Canada (or civil law of Quebec) and pursuant to any specific provincial public contracting regulations. A supplier may be able to seek redress for a breach of the AIT, which is an internal trade agreement among the different levels of government in Canada. The Ontario Broader Public Sector Procurement Directive requires the public agencies to which it applies to negotiate, mediate or arbitrate disputes.
Typically the bid call document will prescribe how disputes are to be treated, which may include binding arbitration. The CITT hears complaints respecting procurement involving the federal government covered by the Trade Agreements and certain other international trade agreements. Courts are the preferred forum for all other procurement-related disputes.
The bid call document will usually set out any timing requirement that must be met by the parties to a dispute. Timelines may also be set by an arbitrator, where one is appointed. The time required to achieve finality in a dispute varies according to the dispute procedure relied on by the parties.
In order to commence a review proceeding before the CITT, the complainant must be a bidder or prospective bidder on a designated contract.
Whether a complainant is a bidder is simply a question of whether the complainant submitted a bid. The attributes of a prospective bidder remain unsettled within the CITT's case law. However, the question generally turns on whether the complainant is capable of submitting a bid before bid closing, whether the complainant has been precluded from submitting a bid, whether the complainant has the technical and financial capability to fulfil the requirement that is the subject of the procurement and whether the complainant has the capacity to submit a proposal in response to the solicitation.
A contract is a designated contract if it meets all of the following conditions:
- the contract has or will be awarded by a government institution;
- the goods and/or services being procured are covered by a prescribed Canadian trade agreement;
- the value of the tendered contract is at or above the monetary threshold for coverage under the specific prescribed Canadian trade agreement;
- the procurement must be within Canada.
A review proceeding may be initiated on the grounds of a breach of one or more applicable international trade agreements, statutes, regulations and contracts. Breach of contract encompasses a number of grounds that are unique to the procurement framework, such as breach of the purchaser's duty to conduct a fair competition, to make full disclosure of, inter alia, evaluation criteria and to reject non-compliant bids. A purchaser's failure to disclose material information and honour the representations made in its tender call can also give rise to concurrent tort claims.
The CITT has the power to postpone the award of a contract, to order a procurement to be undertaken again or to award damages to a complainant. Courts have access to a broader arsenal of powers, including the granting of injunctions, setting aside contracts, ordering procurements to be undertaken again and awarding damages to the complainant.
See 8(g), directly above.
The length of a judicial proceeding for review will vary depending on the complexity of the subject matter and the behaviour of the parties in the review process. The commercial value of the procurement contract and the resources available to the parties for the review process are also significant influencing factors. It is not uncommon for legal proceedings in Canada to span over several years.
Subject to the specific rules of a particular procurement process, public entities are generally under no obligation to notify unsuccessful bidders of the outcome of a procurement before a contract is awarded. Public bodies nevertheless do often provide unsuccessful bidders with the opportunity to learn why their bid was rejected in favour of another. Pursuant to freedom of information legislation, the federal, provincial, territorial and in some cases municipal governments and their agents are required to provide certain information regarding a procurement process upon to persons who make a valid request.
The substantial amount of case law arising from bid complaints to the CITT suggests that government procurement review proceedings are common.
There have been many court decisions involving procurement disputes, including those by the Supreme Court of Canada, which are followed by the lower courts across Canada. These main Supreme Court of Canada decisions are the following:
- Ontario v. Ron Engineering (1981), in which the Supreme Court of Canada established the "Contract A/Contract B" paradigm;
- M.J.B. Enterprises Ltd. v. Defence Construction (1951) Limited (1999), in which the Supreme Court of Canada held it was an implied term of the tender contract that the owner was under an obligation to accept only a "compliant" tender;
- Martel Building Limited v. Canada (2000), in which the Supreme Court of Canada found an implied obligation to treat all bidders fairly and equally;
- Double N Earthmovers Ltd. v. Edmonton (City) (2007), in which the Supreme Court of Canada held that owner/buyers were under no duty to investigate whether an apparently compliant bidder could actually comply with the requirements of Contract B;
- Tercon Contractors Ltd vs. British Columbia (Ministry of Transportation and Highways) (2010), in which the Supreme Court of Canada held that a well drafted, unambiguous exclusion clause could be sufficient to exclude liability for a breach of the duty of fairness.