The Ontario Superior Court has ruled in favour of Walsh, the general contractor for a station on the Toronto-York Spadina Subway Extension, awarding them 1,047 days of delays due to design issues by the TTC. The ruling also rejected Walsh's attempts to pass on subcontractor flow-through claims to the TTC.
When finally issued, the Ontario Superior Court ruling exposed what Sahil Shoor, partner at Gowling WLG, and associate Nailah Ramsoomairin August, the dispute between Walsh and the TTC surrounded the construction of a station along the Toronto-York Spadina Subway Extension. The project was a ‘design-bid-build’ project which included three phases: the design, the bidding and then the construction. The advantage of this type of project is that it allowed TTC to determine the design.
The downside of TTC determining the design for the project was that it equally owned the risks associated with its design and the risk of the project being delayed due to design issues. The project suffered significant delays and resultant additional costs, both for Walsh as general contractor and for its subcontractors. Although the independence of Walsh’s expert witness on these points was strenuously questioned by the TTC, ultimately, “the Court therefore found that Mr. Ott was able to provide the Court with fair, objective and non-partisan evidence,” write Shoor and Ramsoomair.The Court found Walsh was entitled to 1,047 days of delays, most of which were related to “design issues.” In fact, the TTC designs were not finalized at the time the contractor and subcontractors commenced their work. Walsh had also received several subcontractor flow-through claims during the course of the project totalling over $61 million, which Walsh wished to pass on to the TCC. However, the court rejected these claims, saying it was Walsh and not the TTC that had contracts with the subcontractors. Walsh had, in fact, made two arrangements with its subcontractors dealing with assignment and non-assignment liquidated agreements. “Under the assignment liquidating agreements, Walsh paid the subcontractor an amount representing all the contractual payments due and payable to the subcontractor,” write Shoor and Ramsoomai
CONSTRUCTION TTC SUBWAY DELAYS COSTS
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