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SNC-Lavalin

SNC-Lavalin

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Published by mchardie
SNC-Lavalin memo to the Department of Transportation regarding the Princess Margaret Bridge
SNC-Lavalin memo to the Department of Transportation regarding the Princess Margaret Bridge

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Published by: mchardie on Feb 01, 2012
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04/23/2013

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Project Number: 020871
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SNC.NBDOT30CC.O438
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SNC-LAVALININC.
SNCL
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455,Rene-LevcsqucBlvd.West
+ fi't' 1"1. Monlreal,Qnebec
Canada H2Z lZ3
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Tel.:
(514) 393-1000FR." (514) 861-5349
Fredericton,October , 2011 "
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TO THE ATTENTION OF:"';-;"",:ISPUTE RESOLUTIONBOARD
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AND TO THE ATTENTION OF:
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""~r"~t~~;f1"¥;in~ rt:)1'~NEW BRUNSWICK DEPARTMENT OF TRANSPORTATION
PRINCESSMARGARET BRIDGE PROJECT
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,~n t~~ ,,;c,'h~'~-~$"'~';
c/o KristaMacDonald, .Eng.
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Room 526, KingTower, KingsPlace (440 KingSt.Fredericton, New Brunswick !m~~~ !~;';"c", -~,
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c/o: ProjectManager 1"!~,i,'11~,";"~,':!;
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RE: PrincessMargaret Bridge Project
"Notice of Referral" or Non-Conformanceotice DBNCNO211
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DearSirs,
INTRODUCTORY NOTES:
1. Capitalizederms and expressions sedbut not otherwisedefinedherein shall have he meanings iven o them in the ProjectAgreement ated February 7, 2010amongHerMajesty he Queenn right,of he Province
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Member f theSNCLAVALIN roup
 
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of New Brunswick, as represented by the Minister of Transportation, and SNC-Lavalin nc., relating to thePrincessMargaret BridgeProject.2. Where there is a reference o section numbers without the associateddocument, the document in question is
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the Project Agreement.
~] 3. As noted n S. (i)
below, in its letter to the Province requesting that this Contractor NCN be withdrawn, theContractor requested hat, in the alternative, the dispute resolution procedure be placed on hold until a laterdate, but the Provincedid not respond directly to this request. The request was motivated by:a. the extreme exigenciesof Project Completion, o which we are devoting all of our resources;
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b. the broad scope of our factual and legal arguments on the black letter of the contract as well as
,
roader principles of law and equity. These principles relate to (i) good faith, (ii) fair use of
.
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ontractual discretion, (iii) the duty to cooperate in the pursuit of a common contractual aim, and '-(iv) the particularly punitive quality assurance structure of the Project Agreement and the manner
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in which it is being deployed by the Province in this Project including, without limitation, thesignificantly delayed Project start date, the imposition of out of scope work relating to pier stability,the change order relating to Sterling Lloyd Waterproofing, all of which have negatively impactedProject delivery through no fault of the Contractor; and
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c. our agreement to postpone discussions on certain matters identified above in Paragraph 3(b)(iv),resulting in our complete surprise at receiving DBNCNO211.
)
As not~d in S. lk) below, on Octo~er. 3, 20~1, the. Contractor sent a further letter t~ the Province asking fo~ an I
extension of the date for submitting thIs Notice of Referral due to the particular demands of Project ~,~
completion. As noted In S. 11) below, in a verbal communication to the Contractor on the day of the original
I
ubmission deadline, the Province advised the Contractor that it would not consent to any extension.
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This letter
does
not necessarily contain a complete statement of all of the facts and arguments available to us.We therefore reserve the right to follow up with an amended version hereof providing more complete facts,grounds and documents to ensure this process allows for a full hearing of the issues and provides an equitableplatform to the Contractor given the Province's purported need to extend the prescribed la-business daydeadline for responding to our Notices of Referral. The Province cannot refuse to grant us an extension whileunilaterally imposing an extension on us in its own favour. This shall also confirm that the Province hasindicated, verbally, to the Contractor, its agreement with this reservation of rights and that it would awaitreceipt of our more developed documentation before providing their response.4. This complex matter necessitates written and oral presentations to the Dispute Resolution Board (ORB). Wewould ask that the Contractor be allowed to offer a written rebuttal to the Response of the Province no laterthan 10 Business Days after it is received. We anticipate that the DRB will require three separate (4)-hourhearings to allow the parties to properly present the many issues within this dispute and address any questionsthe panel members may have prior to delivering their decision.c;
cxi
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I. FACTS:
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a) Duringan audit conducted n 6 September 011, he PMBAuditor determinedhat the Contractor ad not
achieved Full Traffic Availability by the Full Traffic Condition date of 5 September2011.b) On September 13, 2011 he Provincedelivered DBNCN0211o the Contractor.
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c) On September 20,2011 the Contractor notified the Province hat it declined o accept DBNCN0211.
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d) OnSeptember 1, 2011 he Province onfirmedhat DBNCN0211ad beenplacedn dispute nd equested
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a DisputeResolutionMeetingbe scheduled ithin 10 business ays.
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;c".,'"" e) On September 22, 2011 the Project Manager and Provincial Project Manager met, but were unable to- resolve he dispute relating to DBNCN0211.'" ':~'
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f) On September27, 2011 the Contractorsent the Provincea letter ("Contractor'sFurtherResponse")
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.:, ~;;.;;:;":~ providing urther nformationas o our grounds or disputing he Non-Conformanceoticeand equesting,
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in the event of the Province's ersistence, greement o place he dispute esolutionon hold until such
.'",;:.; time as all matters relating to project delayswere discussed.
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~,"', g) On September 30, 2011 the Provincesent a letter that did not respond directly to the Contractor's equestfor an extension of the deadline for submitting the present Notice of Referral, but reiterated that thePrincessMargaret Bridge did not achieve Full Traffic Availability by the RequiredFull Traffic Condition Date,
in ustificationof the
NCN.
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h) On October3, 2011, he Contractor enta further letter o the Province skingor an extension f the date for submitting his Noticeof Referral ue o the particular emands f Project ompletion.i) On October6, 2011, he Province ejectedhis request.
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Basedon the above, he Contractorhereby efers his dispute or resolution by the DisputeResolution oard
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pursuant to Article 25.5 PA
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II. DISPUTEN
BRIEF:
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a) Province Findings as to Facts as Stated in the NCN: The Province contends that the Contractor did not.
, "co, achieve Full Traffic Availability by the Required Full Traffic Condition Date. '",
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b) ProvinceFindings s o ApplicableContractualProvisions s Stated n the NCN:TheProvince llegeshat
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the failure to achieve Full Traffic Availability by the Required Full Traffic Condition Date contravenes ection
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~';";.::~:" 14.1 PAwhich states: '.
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"TheContractor ovenantso ensure hat (a) the Full TrafficConditionDateoccurs n or before he
Required Full Traffic Condition Date and (b) the Total completion Date occurs on or before theRequired Total Completion Date and acknowledgesand agrees that the failure by it to achievesuch
0 covenants ill, without imiting any other remedyavailable o the Province ereunder r at law or in~ equity, esult n ContractorNon-Conformanceayments ecoming ueandpayable y he Contractor
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to theProvince."
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