Fired contractor takes Metro Vancouver to court over troubled sewage plant

Click to play video: 'Acciona sues over North Shore sewage plant dispute'
Acciona sues over North Shore sewage plant dispute
WATCH: A troubled sewage treatment project in North Vancouver appeared headed to court, Thursday, after Acciona Wastewater Solutions launched a multi-million dollar lawsuit against Metro Vancouver alleging breach of contract. Paul Johnson reports – Mar 31, 2022

The company originally contracted to build a massive new wastewater treatment plant on the North Shore is suing Metro Vancouver for nearly $300 million, after the regional district terminated the contract.

The regional district pulled the plug on the deal in October, citing cost escalation from $500 million to $1 billion and construction delays.

Under the original terms of the public-private partnership, Acciona Wastewater Solutions LP was to design, build, partially finance and operate the plant, at a cost of $500 million and a completion date of January 2021.

On Thursday, Acciona filed a notice of civil claim in B.C. Supreme Court, alleging the district was in fact behind the problems with the project.

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The company claims that it was actually impossible to build the plant, as specified in the original project agreement, on the site Metro Vancouver selected.

Click to play video: 'Taxpayer group wants independent investigation into wastewater plant construction fiasco'
Taxpayer group wants independent investigation into wastewater plant construction fiasco

It also claims that Metro Vancouver’s design and construction specifications were “highly prescriptive, conflicting and error-ridden,” and that the district “interfered extensively” with design and construction work that were, under the project agreement, the company’s sole responsibility.

Acciona claims that Metro Vancouver refused to grant extensions or pay additional compensation for changes it was forced to make to the project in order to address “numerous conflicts and errors” with the design specifications.

The suit states that by mid-2021 the company had recalculated a realistic estimate of 2025 to complete the project, at the cost of $1 billion, due to the district’s “wrongful conduct,” the site being “unsuitable” for construction and “the emergence of project risks not contemplated” at the time of the original agreement.

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It alleges Metro Vancouver insisted the work be completed by 2023, “which was, to the knowledge of the (district) physically impossible.”

The company is also claiming that Metro Vancouver wrongfully withheld a $95 million payment for work the company had completed to reach a project milestone.

Acciona is asking the court for that $95 million, along with an estimated $200 million for what it says was wrongful termination of its contract.

Click to play video: 'Contractor on beleaguered North Shore wastewater plant claims district owes it $100M'
Contractor on beleaguered North Shore wastewater plant claims district owes it $100M

None of the claims have been proven in court.

A spokesperson for Metro Vancouver told Global News Thursday that the district had upheld its end of the contract, had paid Acciona in a timely fashion and had only terminated the deal when it became clear the company couldn’t finish the contract on time and on budget.

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The district has previously said it revised its contract with Acciona in 2019 to give the company two-and-a-half more years to finish the plant with a new target date of 2023.

When completed, the facility located at 1311 West 1st Street will serve North and West Vancouver, along with the Squamish Nation, replacing the ageing 1961 facility currently located beneath the Lions Gate Bridge.

When planning for the wastewater treatment plan began more than a decade ago, it was initially estimated to cost $400 million.

By 2017, that estimate grew to $700 million, with a completion date of December 2020.

Metro Vancouver has since hired a new contractor to finish work on the project, however an estimated final cost and completion date remain unclear.

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