Ottawa files dispute against Rideau Transit Group over Stage 1 LRT issues

The bumpy rollout of the city's light-rail transit line and disputes over costs are the subject of newly filed litigation between the city and Rideau Transit Group. THE CANADIAN PRESS/Justin Tang

The City of Ottawa has filed a notice of dispute against the consortium that built the first stage of the city’s light-rail transit line, the second major piece of litigation launched over the project in as many weeks.

Mayor Jim Watson announced Tuesday afternoon that the city filed the notice in Superior Court in Ottawa earlier that day against Rideau Transit Group (RTG).

Ottawa’s claim will dispute an independent certifier’s decision that the city is responsible for additional costs related to the use of Douglas fir lumber versus ash wood in the construction of line, Watson said, as well as the certifier’s “failure to address the city’s counterclaims against RTG on the issues of the Alstom train design and sinkhole costs.”

Global News has not seen a copy of the documents filed in court at the time of writing.

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Read more: City of Ottawa sues LRT insurers for $361M over Rideau sinkhole dispute

Just last week the city announced it has filed a $361-million claim against insurers covering Stage 1 LRT construction who denied the city’s claims for “soft costs” related to the 2016 Rideau Street sinkhole. Part of that suit is a $230-million claim from RTG against the city to have some of its costs related to the sinkhole disruptions covered.

City council moved earlier this year to bolster the contingency fund for LRT litigation with an extra $15 million to cover anticipated legal costs.

Watson said Tuesday that the new litigation was among the disputes the city was gearing up for with the $15-million boost.

“These kinds of suits and countersuits, unfortunately, are par for the course. You get into multi-billion-dollar contracts and you’re going to have disputes,” he said.

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City manager Steve Kanellakos said the city’s legal coffers are “OK for the time being,” noting that Ottawa council prepared itself for the litigation with “proactive” steps earlier in the year.

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Last week’s news of the $361-million lawsuit, first reported by the Ottawa Citizen, came amid the release of a confidential memo intended for city councillors but obtained by members of the media.

Among the motions passed at Tuesday’s finance and economic development committee, where councillors were updated about the latest lawsuit in an in-camera briefing lasting more than two hours, was a request for the integrity commissioner to investigate the source of the leaked memo.

West Carleton-March Coun. Eli El-Chantiry, who moved the motion, suggested the integrity commissioner use all available resources, including calling on police services if need be, to determine how the memo was distributed to the press.

City solicitor David White said Tuesday that the memo, which outlined claims filed publicly in court that same week, also discussed aspects of the city’s legal strategy and included privileged solicitor-client information.

“Hence the need for confidentiality,” he said.

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