M. Armitage

Following dismissal of the plaintiff’s construction tendering claim, the court determined the appropriate costs award.

The successful defendant sought partial indemnity costs to the date of its Rule 49 offer and substantial indemnity costs thereafter.

The court declined to award substantial indemnity costs, holding that a nominal offer to dismiss the action without costs did not justify enhanced costs absent sanctionable conduct by the plaintiff.

Given the unsettled state of the law on construction tendering issues and the legitimate legal dispute raised, the court found the case warranted litigation.

Partial indemnity costs were awarded with reductions to certain fees and disbursements, including expert and travel expenses.

The plaintiff contractor challenged the rejection of its bid in a public tender for a highway construction project, alleging breach of the tendering process and seeking lost profits after the contract was awarded to a higher bidder.

The owner investigated the bid following a complaint and determined that the bidder had understated the declared value of imported steel, a factor used to calculate the adjusted tender price.

The court held that the owner was entitled to investigate compliance beyond the face of the bid and that the inaccurate declaration constituted a material non-compliance with the tender requirements, preventing formation of Contract A under the tendering framework.

The court further held that even if there had been a breach, the claim would have been barred by an exclusion clause in the tender documents.

The action was dismissed.