On August 1, 2003, Mr. Justice Hawco of the Court of Queen’s Bench of Alberta delivered Written Reasons for Judgment in the aforementioned lawsuit following a five week earlier in the year. The Plaintiff Banister Pipeline Construction Company (“Banister”) bought the action for breach of duty of care and negligent misrepresentation against the TransCanada PipeLines Limited (“TransCanada”) in the tendering of pipelines contracts and the awarding of those contracts in 2000.
Banister was a member of the Pipeline Contracttors Association of Canada (PLCAC), an association of pipeline contractors which employed building trade unions. PLCAC was the bargaining agent for those contractors.
Prior to April of 2000, TransCanada had never awarded a contract to a non-PLCAC contractor on its mainline east of the Alberta/Saskatchewan border. In March of 2000, TransCanada put out for tender six segments of PMP work on the main TransCanada pipeline east of the Alberta/Saskatchewan border. In addition to Banister and several other PLCAC contractors, TransCanada invited two non-PLCAC contractors to bid on at least some of the six segments of work, which were put out for tender. Banister bid on all six segments of work whereas the non-PLCAC contractor, Midwest, bid on only one segment of work in the Thunder Bay are of Ontario. It was the successful bidder on three contracts for Pipeline Maintenance Programme (PMP work on TransCanada’s main pipeline.
On April 25, 2000, TransCanada verbally awarded three of the contracts to Banister. At that time, it did not advise banister that it was contemplating awarding a contract to a non-PLCAC contractor for the segment of the TransCanada PMP work on the main pipeline near Thunder Bay.
On April 30, 2000, the Collective Bargaining Agreement between the PLCAC and the four building trade unions expired. One of those unions, the United Association of Journeyman and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada (“UA”) was in a legal position to strike on May 1, 2000. On that date TransCanada awarded the contract to Midwest for the PMP work on its main pipeline in the Thunder Bay area.
On June 17, 2000, the UA went on strike against the PLCAC, shutting down two of the contracts which Banister had been awarded for PMP work on the TransCanada mainline in Ontario. The strike effectively paralyzed Banister’s work on the two contracts for five weeks. Banister claimed that it suffered damages in the amount of $10 Million on account of the delay caused by the strike.
Banister brought this action on the ground that TransCanada owed a duty of care to Banister to advise it that TransCanada was contemplating awarding a contract in Ontario to a non-PLCAC contractor before Banister accepted the awards to it of the three contracts. Banister also claimed that TransCanada had misrepresented to Banister that it would not award PMP work to a non-PLCAC contractor on the main pipeline east of the Alberta/Saskatchewan border. Banister claimed that the strike was a consequence of TransCanada awarding a contract to a non-PLCAC contractor with the result that it has suffered damages of approximately $10 Million due to delay and other disruptions caused by the strike. Banister argued that I would not have accepted the award of the 3 contracts by TransCanada if it had known that TransCanada was contemplating awarding a contract to a non-PLCAC contractor.
In his judgment, Mr. Justice Hawco found that TransCanada did not represent to Banister that it would not award PMP work to a non-PLCAC contractor prior to the submission of Banister’s bid. Nor did he find a duty of care on the part of TransCanada to disclose to Banister that it was contemplating awarding a contract to a non-PLCAC contractor. Banister was awarded damages in the amount of $5000,000.00 for a discount which Banister gave on account of misrepresentation by TransCanada during oral negotiations on April 25, 2000. Banister also recovered damages for the installation of a well pointing system in the amount of $529,000.00. Finally, the Court dismissed TransCanada’s Counterclaim, which was based on the premise that Banister had misrepresented that it was able to carry out the work when it knew that the Collective Bargaining Agreement was going to expire without a new agreement.
Counsel for TransCanada at trial were Thomas H. Ferguson, Q.C. and Michelle Novak, of McCarthy Tetrault LLP, and Doug McLean of TransCanada Pipelines Limited. Banister was represented by Ian Blue, Q.C. and Eunice Machado of Cassels Brock Blackwell LLP.
Banister was a member of the Pipeline Contracttors Association of Canada (PLCAC), an association of pipeline contractors which employed building trade unions. PLCAC was the bargaining agent for those contractors.
Prior to April of 2000, TransCanada had never awarded a contract to a non-PLCAC contractor on its mainline east of the Alberta/Saskatchewan border. In March of 2000, TransCanada put out for tender six segments of PMP work on the main TransCanada pipeline east of the Alberta/Saskatchewan border. In addition to Banister and several other PLCAC contractors, TransCanada invited two non-PLCAC contractors to bid on at least some of the six segments of work, which were put out for tender. Banister bid on all six segments of work whereas the non-PLCAC contractor, Midwest, bid on only one segment of work in the Thunder Bay are of Ontario. It was the successful bidder on three contracts for Pipeline Maintenance Programme (PMP work on TransCanada’s main pipeline.
On April 25, 2000, TransCanada verbally awarded three of the contracts to Banister. At that time, it did not advise banister that it was contemplating awarding a contract to a non-PLCAC contractor for the segment of the TransCanada PMP work on the main pipeline near Thunder Bay.
On April 30, 2000, the Collective Bargaining Agreement between the PLCAC and the four building trade unions expired. One of those unions, the United Association of Journeyman and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada (“UA”) was in a legal position to strike on May 1, 2000. On that date TransCanada awarded the contract to Midwest for the PMP work on its main pipeline in the Thunder Bay area.
On June 17, 2000, the UA went on strike against the PLCAC, shutting down two of the contracts which Banister had been awarded for PMP work on the TransCanada mainline in Ontario. The strike effectively paralyzed Banister’s work on the two contracts for five weeks. Banister claimed that it suffered damages in the amount of $10 Million on account of the delay caused by the strike.
Banister brought this action on the ground that TransCanada owed a duty of care to Banister to advise it that TransCanada was contemplating awarding a contract in Ontario to a non-PLCAC contractor before Banister accepted the awards to it of the three contracts. Banister also claimed that TransCanada had misrepresented to Banister that it would not award PMP work to a non-PLCAC contractor on the main pipeline east of the Alberta/Saskatchewan border. Banister claimed that the strike was a consequence of TransCanada awarding a contract to a non-PLCAC contractor with the result that it has suffered damages of approximately $10 Million due to delay and other disruptions caused by the strike. Banister argued that I would not have accepted the award of the 3 contracts by TransCanada if it had known that TransCanada was contemplating awarding a contract to a non-PLCAC contractor.
In his judgment, Mr. Justice Hawco found that TransCanada did not represent to Banister that it would not award PMP work to a non-PLCAC contractor prior to the submission of Banister’s bid. Nor did he find a duty of care on the part of TransCanada to disclose to Banister that it was contemplating awarding a contract to a non-PLCAC contractor. Banister was awarded damages in the amount of $5000,000.00 for a discount which Banister gave on account of misrepresentation by TransCanada during oral negotiations on April 25, 2000. Banister also recovered damages for the installation of a well pointing system in the amount of $529,000.00. Finally, the Court dismissed TransCanada’s Counterclaim, which was based on the premise that Banister had misrepresented that it was able to carry out the work when it knew that the Collective Bargaining Agreement was going to expire without a new agreement.
Counsel for TransCanada at trial were Thomas H. Ferguson, Q.C. and Michelle Novak, of McCarthy Tetrault LLP, and Doug McLean of TransCanada Pipelines Limited. Banister was represented by Ian Blue, Q.C. and Eunice Machado of Cassels Brock Blackwell LLP.
