Wendy R. Cole

The Court of Appeal issued an addendum to its reasons for judgment released on September 7, 2005.

Following correspondence from CGU Insurance Company of Canada, the court amended paragraph 5 of the reasons to clarify that CGU's concession at the hearing was directed specifically to the trial judge's obiter concerning the absence of an explicit forfeiture provision in the instructions to tenderers, and did not relate generally to the trial judge's interpretation of the bid bond.

The Toronto Transit Commission (TTC) appealed a trial decision dismissing its action for breach of contract against Gottardo Construction Ltd. and its bid bond insurer.

Gottardo submitted the lowest bid for a construction project but subsequently claimed a $557,000 error and refused to execute the contract.

The trial judge found that Contract A was not formed upon the opening of the tenders because additional documents were required, and alternatively, that equitable rescission applied.

The Court of Appeal allowed the appeal, holding that Contract A was formed when the tenders were opened, as the parties clearly intended to initiate contractual relations at that time.

The error was not apparent on the face of the tender, and the financial hardship to the bidder did not render enforcement unconscionable.

Judgment was entered for the TTC for $434,000.