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Serious allegations leveled in Way’s Haulage and Excavation lawsuit against City of Corner Brook

City of Corner Brook
City of Corner Brook - Submitted

A business that alleges the City of Corner Brook conspired to thwart the company’s contractual obligations and prevent it from acquiring more work is suing the municipality.

A statement of claim filed in the Supreme Court of Newfoundland and Labrador in early October by Way’s Haulage and Excavation Limited, along with its operators Colin and Jacqueline Way, makes a litany of allegations against the city and some of its current and former managers.

The company, incorporated in 2003, has amassed considerable experience working for municipalities in Newfoundland and Labrador, as well as the provincial government and various private clients.

It was the successful bidder for a number of tenders issued by the City of Corner Brook between 2015 and 2017, including contracts for work such as fire hydrant snow-clearing and jobs involving the city’s salt shed, retaining walls, the Georgetown Road flushing chamber and the bicycle network.

Way’s also bid on work involving the repair of water main leaks, building demolitions, the Central Street sewer upgrade and work in the Riverside Drive area.

The company alleges the City of Corner Brook breached contracts, breached the implied contractual duty to act honestly and in good faith, abused the power of public office, violated the Public Tendering Act, defamed the company and breached the privacy of the company and its proponents.

None of the allegations have been proven in court.

The Western Star reached out to the Ways and their lawyer, the City of Corner Brook and some of the municipal employees named in the statement of claim, but no one would comment on the litigation.

The City of Corner Brook did indicate it planned to file a defence to the statement of claim but that has not been filed with the Supreme Court.

No dates have been set for the matter to be called in court.

Water main contracts

In the spring of 2015, there were more than 60 water main leaks throughout Corner Brook. The allegation is that the city avoided obligations set out in the Public Tendering Act by contracting a company, Humber Arm Contracting, on a case-by-case basis to repair some of the leaks throughout the summer of 2015, instead of issuing a tender for all the work.

Starting in September 2015, Way’s Haulage claims it was blacklisted and the city began acting in bad faith towards the company after Way’s complained about how the city was giving the water main repair work to Humber Arm Contracting.

When the city eventually did issue a tender for the remainder of the water main leak repair work, Way’s Haulage claims the city crafted the tender in a way that favoured Humber Arm Contracting.

When Way’s Haulage did appear still eligible to win the tender because of work it was doing on the city’s salt shed property, the company alleges the city cancelled the tender and continued to use contractors outside the scope of the Public Tendering Act in order to frustrate any opportunity Way’s had to successfully bid on the work.

The statement of claim contains an excerpt from an email sent Sept. 22, 2015 by city manager Melissa Wiklund to Steve May and Rayna Luther, who are respectively the city’s former director and assistant director of infrastructure and public works. In the email, Wiklund expresses her displeasure to the two senior managers.

“As you may recall, I initially suggested you include the contractor Colin Way in the tender process to avoid this type of mess exactly,” reads Wiklund’s email. “Instead, you disregarded my advice and excluded the contractor. It is rather annoying to me now to be left to address the questions being posed by council and the eliminated contractor after the fact.”

Wiklund goes on to tell the two managers they will be held accountable to council and the public for choosing to go the route they did.

The statement of claim does not confirm how the plaintiff accessed this email correspondence.

Demolition of buildings contracts

Way’s Haulage and Excavation submitted a compliant bid for a demolition of buildings contract in the fall of 2015, which it ays was $50,000 under the city’s budget for the work. Yet, the recommendation to council from community services manager Donald Burden, according to the plaintiff’s court documents, was to reject the bid because it was over budget.

The documents claim this was a deliberate violation and circumvention of the Public Tendering Act and an abuse of power by the city.

The city later re-tendered portions of the demolition contract and ultimately awarded work that was as costly, or more costly, than the bid submitted earlier by Way’s.

Humber Arm Contracting won the bid for the abatement portion of the contract, while the city hired contractors from its standing offer list to do the rest of the demolition work.

Snowclearing contract

Way’s was the successful bidder for a three-year contract to clear snow from 710 fire hydrants in Corner Brook from November 2014 to April 2017.

The company’s understanding was the hydrants needed to have a three-foot clearance on both sides and the front of the hydrants, but the rear of the hydrants did not need to be cleared. Clearing snow from behind the hydrants was not necessary, the company said it was assured, because many of them were up against walls or fences and not clearing the rear of the hydrants would not impede access to operating them in case of emergencies.

During the winter of 2014-15, Way’s completed seven rounds of fire hydrant snowclearing, amounting to around 5,000 hydrants. The contractor said it had been advised by the city throughout the winter that only 10 of these had to be redone.

In December 2015, subsequent to the aforementioned issued with water main contracts, Way’s Haulage was informed by the city it now had to clear snow from behind hydrants. Following an inspection after the first round of clearings in January 2016, Way’s was told its work had not met the contract specifications because 72 of 102 hydrants inspected had not been cleared 360 degrees around the hydrant.

In February, the city told Way’s it would only be paid 75 per cent of its invoice submitted for the work done because snow had not been cleared from behind the hydrants.

Colin Way also complained to the city about how he was allegedly treated by Luther, city employee Chad Murrin and human resources manager Steve Colbourne during a meeting in early February 2016 regarding the snowclearing contract.

Way said he was subsequently banned from visiting all city offices, unless invited by Wiklund.

Three weeks later, Way was shown a notice that had allegedly been placed on bulletin boards at the city depot, advising all employees to not have any interaction with the Ways or their company because the city was now in active litigation with them.

The Ways and their company claim this was defamatory as the city was not in fact in active litigation at that point in time.

According to court documents, the plaintiffs filed a complaint with the Office of the Information and Privacy Commissioner, which found the notice posted to have been libelous and had caused the plaintiffs substantial reputational damage.

The Ways claim they were bombarded with inquiries from people asking them about the city suing them, which was not actually true, and frequently encountered city employees who told them they were not permitted to talk to them.

Jacqueline Way, who holds a masters degree in social work, felt compelled to cease operation of a private counseling service she was operating at the time because of the negative impact the situation was having on her professional reputation in that regard.

In March 2016, the city stopped using Way’s Haulage as its fire hydrant snow clearing contractor and began using other contractors for the work, which the plaintiffs also claimed was a breach of contract. It did the same for the winter of 2017.

The statement of claim also references an email sent by Wiklund to other senior city management in March 2016, which asks what could be done to restrict a contractor from future bidding.

Retaining walls contract

Way’s Haulage had an open contract with the city to complete three retaining walls and was awarded another contract in May 2016 for two more retaining walls.

According to the statement of claim, the contractor had continuous open communication with the city’s engineering department up until March 2016. Despite attempts to communicate with city staff about the upcoming work, Way’s Haulage was told a private engineering company would now be their contact with the city for the retaining walls work. A representative from the engineering firm was assigned to observe the retaining walls work, which the plaintiff said was embarrassing and amounted to differential treatment by the city.

The statement of claim alleges this was further indication that the dispute arising from the snowclearing contracts had carried over into other departments and to other city employees.

Central Street sewer upgrade contract

In July 2016, Way’s Haulage submitted a bid for the Central Street sewer upgrade project.

According to the statement claim, there were two additions made to the tender before bidding. A notice of one of these changes was delivered to Way’s Haulage by being placed in an employee’s truck.

Way’s complained to the city about the manner in which the addendum was delivered.

While the tender noted the job required the removal of one set of wires, Colin Way had it confirmed by the engineering company he was dealing with that the job would require the removal of four sets of wires.

Way bid on the tender based on the knowledge of how much wire was to be removed, but lost the contract by $100 to another contractor that was unaware of the additional wire requiring removal.

The statement of claim notes the city’s past practice was to provide all bidders with any new information uncovered during the tendering process.

Georgetown Road flushing chamber contract

In July 2016, Way’s Haulage successfully bid on work for a flushing chamber for Georgetown Road. The contract specified it would take three weeks in August 2016 to do the job.

The statement of claim asserts that work could not start until late August because of schedule changes and other delays, including an allegation that the city failed to respond or provide complete answers to issues raised by the contractor with regard to alleged deficiencies of the design and other aspects of the contract encountered during the project.

The job was not substantially completed until Dec. 20, 2016.

The plaintiffs claim the city intentionally caused the delays so it would interfere with Way’s bidding on other upcoming tenders being issued by the city

Riverside Drive contract

Way’s Haulage and Excavation bid on the Riverside Drive contract, but claims the city’s deliberate strategy to slow the company’s progress with the Georgetown Road contract made winning it less likely.

According to the statement of claim, Way’s had to increase its bid by $20,000 as a result of the Georgetown Road work delays.

Way’s ended up losing the bid to a contractor that bid less than $13,000 more than Way’s did.

Bicycle Networks contract

In November 2016, Way’s Haulage and Excavation successfully bid on a contract for the bicycle networks in Corner Brook worth a little more than $134,000.

The day before the contract was awarded, according to the statement of claim, the city notified Way’s there would be a change in the contract made in the spring, but did not specify what that change was.

The day Way's learned it had won the tender in November 2016, it made arrangements to purchase crusher dust material as outlined in the contract.

In May 2017, the city told Way’s it was reducing the amount of crusher dust material required, resulting in more than $40,000 being shaved off the contract’s value.

Way’s disputed the legality of this change, noting the Public Tendering Act stipulates that a change order made to a contract originally valued at more than $100,000 cannot exceed $15,000 or 10 per cent of the original contract value.

After work started on the project in early June, the city determined later in the month the crusher dust material being used was inadequate, even though there was no original specification or grading requirement for crusher dust material in the original contract.

In September, the city also cited deficiency in sod used in the project.

As of the date the statement of claim was filed, Way’s had yet to receive an unqualified notice of substantial completion from the City of Corner Brook for the work on the bicycle networks.

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