This article is an extract from the 5th edition of Government Procurement.
In its March 2021 decision in Pomerleau Inc. v. The Province of New Brunswick, the New Brunswick Court of Queen’s Bench struck down the government’s decision to disqualify a $65 million hospital project bid over an insurance certificate requirement. The requirement called for an insurance certification letter from a “New Brunswick resident agent of an insurance company” but the government rejected the certificate since the agent did not have a physical office in the province.
The complainant brought an application for judicial review seeking to quash that disqualification, maintaining that the government was inconsistent in interpreting the residency rule for insurance agents since it had previously accepted the complainant’s insurance certificate from the same insurance company in a prior bidding process. The court agreed, finding that the government acted unreasonably and that the decision to reject the insurance certificate raised “concerns of subjective, arbitrary and inconsistent decision-making that may offend the principle of the rule of law.” The court therefore set aside the government’s decision to disqualify. As this case illustrates, rather than engaging in compliance brinksmanship, purchasing institutions should adopt post-bid compliance cure periods so that any unforeseen misunderstandings over the interpretation of compliance requirements can be addressed and any potential bid irregularities can be rectified before they escalate into legal disputes.
