We have a ruling without the reasons on the Urbacon litigation. This makes it challenging to provide responsible comments that won’t put the City further at risk.
However, from the beginning I have found the whole situation infuriating and the cost of this litigation more than discouraging – long before the court released its ruling.
The previous term of Council inherited a contract that was poorly written for a project of this size and complexity. Communication broke down. Deadlines were missed and deficiencies accumulated.
Despite considerable effort, the financial and operational risk to the City simply became unacceptable and our administration believed they had no choice but to take control of the project. We had leases with other landlords to manage and moving an organization our size while keeping the operation running is a monumental task to coordinate.
The City took the step to terminate the contract with Urbacon – with external legal advice – because we believed it was in the best interest of the community and taxpayers. Staff needed to get the job done to move in and to avoid more of the same on the renovation of the former City Hall.
None of this is new. It was all part of the court proceedings. And it may be that this context is simply not relevant to the ruling. It all comes down to the 2006 contract and how it protected – or not – the City of Guelph and its taxpayers.
The subsequent contract for the Court House was structured differently, to suit a project of this magnitude, and it came in on time and under budget. The risk of conflict between the architect and the contractor was mitigated through a design-build contract. We used a design-build-operate contract on the Organic Waste Processing Facility which also came in on time and under budget.
Since 2006, the City of Guelph has tendered almost 400 capital projects valued at over $300 million and less than 2% of those tenders, including this one, were sent to litigation.
Many projects come with challenges but none of them have compared to this.