The legal rules of bidding and tendering in Canada consist primarily of judge-made law. In particular, the basic framework of bidding and tendering law in Canada was set out in a landmark Supreme Court decision in 1981 which fundamentally altered the common law of contracts as it had previously applied to analysis of tendered contracts.
That decision, R. v Ron Engineering, created the Contract A / Contract B framework which is at the core of Canadian bidding and tendering law. Following that decision owner/developers and bidders found themselves subject to a new set of rights and obligations when engaged with each other in formal bidding processes.
Because the decision represented a radical reformulation of the law, it predictably led to questions about its particular implications, the scope of the rights and obligations created under the scheme, and the extent to which it was actually binding on parties to a bidding process (that is, if you didn’t want to be bound by the new rules for some reason, was it possible to get around them?). To a significant extent this discussion is still ongoing, and the law of bidding and tendering in Canada continues to evolve as the courts are faced with novel situations, particular contractual provisions, and new arguments about why the rules should or should not apply in a particular way to a particular set of facts.
Since Ron Engineering, the Supreme Court of Canada has revisited the law of bidding and tendering five times in the past three decades, most recently in a decision issued this past February. In chronological order, these six decisions are:
R. (Ont.) v Ron Engineering & Construction (Eastern) Ltd., [1979] 24 OR (2d) 332 (ONCA), revd [1981] 1 SCR 111, online: LexUM http://scc.lexum.umontreal.ca/en/1981/1981scr1-111/1981scr1-111.html
M.J.B. Enterprises Ltd. v Defence Construction (1951) Ltd., [1994] 164 AR 399 (ABQB), affd [1997] 196 AR 124 (ABCA), revd [1999] 1 SCR 619, online: LexUM http://csc.lexum.umontreal.ca/en/1999/1999scr1-619/1999scr1-619.html
Martel Building Ltd. v Canada, [1997] 129 FTR 249 (FCTD), revd [1998] 163 DLR (4th) 504 (FCA), leave to appeal refused, 2000 SCC 60, [2000] 2 SCR 860, online: LexUM http://scc.lexum.umontreal.ca/en/2000/2000scc60/2000scc60.html
Naylor Group Inc. v Ellis-Don Construction Ltd., [1996] OJ No 3247, 31 CLR (2d) 195 (ON Gen Div), revd [1999] 119 OAC 182 (ONCA), vard 2001 SCC 58, [2001] 2 SCR 943, online: LexUM http://scc.lexum.umontreal.ca/en/2001/2001scc58/2001scc58.html
Double N Earthmovers Ltd. v Edmonton (City), 213 AR 81 (ABQB), affd [2005] AJ No 221 (ABCA), affd 2007 SCC 3, [2007] 1 SCR 116, online: LexUM http://scc.lexum.umontreal.ca/en/2007/2007scc3/2007scc3.html
Tercon Contractors Ltd. v British Columbia (Transportation and Highways), 2006 BCSC 499, revd 2007 BCCA 592, revd 2010 SCC 4, [2010] 1 SCR 69, online: LexUM http://scc.lexum.umontreal.ca/en/2010/2010scc4/2010scc4.html
The recent Tercon decision has sparked renewed debate in the legal community about the present state and the future of bidding and tendering law and bidding and tendering practices in Canada. The possible impact of the Tercon decision on procurement processes was a feature topic at the Canadian Bar Association’s National Construction Law Section annual conference. As well, provincial branches of the CBA have also been addressing the topic (the CBA New Brunswick Branch is including a session on developments in construction law in their upcoming Fall Conference).
Given that the rules of bidding and tendering are a current topic, I’ve decided that it might be useful (not least for myself) to prepare and publish briefs of the foregoing Supreme Court decisions. I’ll update this post with links to the briefs as I put them up.
Update:
