Quebec company settles with province over botched snowplow deal

A Quebec manufacturing company that narrowly won then abruptly lost a contract to supply snowplows to New Brunswick has reached an out-of-court settlement with the province.

Contract was cancelled after furor over Hartland company's slightly higher bid being passed over

A Quebec company that won a contract to supply snowplows to New Brunswick filed suit when the deal was scrapped. (CBC)

A Quebec manufacturing company that narrowly won then abruptly lost a contract to supply snowplows to New Brunswick has reached an out-of-court settlement with the province.

Les Produits Métalliques A.T. Inc. of Matane, Que., sued for $88,982.76 in lost profits and $30,000 in exemplary damages after the province cancelled a contract for 27 new snowplows and 30 snowplow wings.

"The file Produits Métalliques A.T. Inc. vs. N-B and Services N-B is totally settled," Marco Ross, a court clerk at the Rimouski, Que., courthouse, wrote in an email to CBC News.

Service New Brunswick confirmed a notice of settlement was filed with the Quebec courts but, like the company, would not provide details.

André Tremblay, the president of Les Produits Métalliques, said there would be a news release later.

"And then you will be aware … exactly what the settlement has been," said Tremblay.

'As such, New Brunswick is on the same level as private parties and cannot hide behind its jurisdictional immunity to claim an advantage in a dispute.' - Simon Ruel, Quebec Superior Court judge

The contract worth about $500,000 was awarded to the Quebec company in May 2015 after it submitted a bid just $1,600 lower than one from Craig Manufacturing of Hartland. 

Delivery of 27 snowplows and 30 plow wings was set for Sept. 30.

But when news of the contract surfaced, the backlash from the public was swift. Brian Gallant's Liberal government canned the deal on June 15, according to court documents.  

"This certainly should have never have happened in the first place, where the contract for these plows went outside the province," said Jeff Carr, the Progressive Conservative critic for transportation and infrastructure.

"There was a clear benefit of having the contract awarded inside the province just based on the economic factors." 

Les Produits Métalliques claimed work on the order was already underway when the company found out June 22 through the news media that the contract had been cancelled.

In June 22, 2016, Les Produits Métalliques filed its lawsuit against the province.

Claimed 'sovereign immunity'

Each side argued to have the case heard in its own province, but Justice Simon Ruel of the Quebec Superior Court declared it would be heard in Quebec.

The New Brunswick government also argued it had "sovereign immunity" in this case and couldn't be sued, but Ruel disagreed.

"New Brunswick, like other corporate citizens, seeks to purchase certain equipment or services at the best possible market price," Ruel wrote in his decision in February.

"As such, New Brunswick is on the same level as private parties and cannot hide behind its jurisdictional immunity to claim an advantage in a dispute." 

After the contract was cancelled, Roger Melanson, the transportation minister at the time, promised a "complete review" of the tendering process, but no results from any such review have been made public.

About the Author

Shane Fowler

Reporter

Shane Fowler has been a CBC journalist based in Fredericton since 2013.