Case information

Contracts — Call for tenders — Obligation to treat all tenderers fairly — Shopping — Exception under Cities and Towns Act allowing negotiation by mutual agreement — Whether Court of Appeal committed reviewable error in interpreting Cities and Towns Act, and implied obligations under contract A, in way that effectively deprived Ville de Montréal of alternative contractual outcome and avenue expressly provided for in Cities and Towns Act (s. 573.3(3)), even though Ville de Montréal was presented with tender that it considered disadvantageous because it was too expensive — Alternatively, if call for tenders had to be cancelled before Ville de Montréal could concretely explore alternative contractual avenue permitted by legislature, whether Court of Appeal committed reviewable error in selecting entire profit expected by lowest tenderer as adequate and causal remedy for such fault — Cities and Towns Act, CQLR, c. C-19, s. 573.3(3).

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In June 2018, the applicant, Ville de Montréal, published a call for tenders to meet its snow transport service needs for two lots located in the borough of Ville-Marie. After that call for tenders was cancelled because the proposals were considered too high in light of the estimates made, a second call for tenders was published in July 2018. The respondent, 9150-2732 Québec inc. (TMD), participated in the second call for tenders. After the call for tenders was published and before the tender closing date, Ville de Montréal engaged in discussions with Transvrac, a company that held a trucking brokerage permit issued by the Ministère des Transports of Quebec and that was entitled to enter into contracts by mutual agreement with Ville de Montréal in accordance with s. 573.3(3) of the Cities and Towns Act, CQLR, c. C-19. On August 9, 2018, on the opening of the tenders, TMD had the lowest tender, but it was higher than Ville de Montréal’s estimate. In October 2018, Ville de Montréal informed TMD that the work would be awarded to Transvrac. On November 19, 2018, the municipal council awarded the contract to Transvrac. On November 20, TDM was informed that the call for tenders had been cancelled. TDM then filed an application for an interim injunction to obtain an order forcing Ville de Montréal to award it the contract and to block the signing of the contract by mutual agreement with Transvrac; it also filed a claim for damages against Ville de Montréal for its refusal to award TDM the contract. The interim injunction application was dismissed and leave to appeal was denied. The Superior Court allowed the re amended originating application in part and the Court of Appeal allowed the appeal in part.