In its December 2023 determination in Leo-Pisces Services Group Inc. v. National Research Council of Canada, the Canadian International Trade Tribunal awarded lost profits to the complainant and ordered the government not to extend a contract that was improperly awarded to another bidder. The dispute dealt with an informatics services RFP issued by the National Research Council of Canada that required proponents to submit pricing for the original term of the contract, as well as pricing for the extension options under that contract.
A losing bidder challenged the award after discovering that the government only evaluated pricing submitted for the original term but failed to evaluate the pricing submitting for the extension options. The Tribunal found that the RFP was ambiguous regarding the evaluation of pricing and that the latent ambiguity did not give proponents the opportunity to clarify the price evaluation rules.
More specifically, while the RFP was silent as to whether the extension option pricing would be evaluated, the RFP clearly stated that proponents would be disqualified if they failed to submit pricing for the extension periods. The Tribunal found that this led the complainant to reasonably assume that all the requested pricing, including that for the extension options, would be evaluated.
While the government argued that it did not have to evaluate the extension option pricing since it may never exercise those options, the Tribunal disagreed, finding that the government is under a duty to clearly disclose its evaluation criteria. The Tribunal concluded that government’s evaluation of pricing in a manner that was inconsistent with the wording of the RFP was tantamount to basing the evaluation on undisclosed criteria. It therefore awarded lost profits to the complainant and ordered the government not to exercise its extension options under the improperly awarded contract.
This ruling, which illustrates why public institutions should adopt formal solicitation drafting protocols to ensure that their price evaluations are clear and transparent, will be covered in the Integrating Specifications and Pricing Forms module of our new RFx Drafting in the Canadian Public Sector certificate program that runs in May and returns in November. Please see our current training schedule for more details.
