Ottawa Hospital asks court to combine lawsuits to avoid delay, expense
DRS lawsuit claims $1.5M in unpaid bills, at same time Ottawa Hospital suing DRS in 'fraud' scheme
The Ottawa Hospital is asking the court to combine its lawsuit against several contractors together with a suit against the hospital from one of those same companies.
DRS Construction first launched a lawsuit in November 2015, claiming the hospital owes it close to $1.5 million for lost work as well as unpaid invoices dating back to 2010.
The Ottawa Hospital launched a lawsuit in January 2016, naming DRS and four other construction companies, as well as two hospital managers, claiming "broad fraud and conspiracy."
The hospital suit claims the companies gave kickbacks, including lavish fishing trips and discounted or free home renovation work, to the two managers in return for "improper procurement advantages." Those advantages included influence over tenders as well as accepting "improper and inflated invoices" for no work or work that was not completed, the lawsuit claims.
Facts, relationships interwoven
This week, the hospital filed a motion with the Ontario Superior Court stating "the common facts, claims, disputes and relationships between the parties are so interwoven as to make separate actions and trials undesirable."
The lawsuit launched by DRS itemizes a little over $1 million in unpaid invoices for jobs from February to October 2015 — the same period an independent auditor had been investigating the relationship between contractors and its then head of capital projects, Frank Medwenitsch, as well as former director of engineering and operations, Brock Marshall.
The DRS suit also claims a sum of $255,829.38 for old invoices dating back to 2010. The DRS suit claims the amount was negotiated with Marshall, down from an original claim of $405,000.
DRS invoices 'improper,' hospital claims
The old invoices are discussed in the suit launched by the Ottawa Hospital under the heading "Improper Approval of Purported DRS Invoices." The suit claims the owner of DRS, Gerry Dubé, along with others, "conspired and colluded together to essentially extort Marshall, in order to obtain Marshall's approval to pay numerous unsupported and improper DRS invoices dating back to 2010."
None of the claims in either suit has been tested in court.
In the hospital's motion to consolidate the suits, it states "the legitimacy of those (DRS) invoices is at issue." It goes on to claim that continuing the two suits separately "would be repetitious, expensive, cause delay, and give rise to duplicate evidence and the associated risks of inconsistent findings."
The hospital argues both claims are at the same initial stage and should be consolidated, with the DRS claim being included as a counter claim to the hospital's suit.
A hearing on the hospital motion is set for March 1. Neither of the lawyers for the two parties involved returned calls for a comment from CBC News.