This article is an extract from the 5th edition of Government Procurement.
In its January 2018 decision in Attorney General of Canada v. Valcom Consulting Group Inc., Canada’s Federal Court of Appeal upheld a Canadian International Trade Tribunal determination that overruled a government contract termination decision. The Court ruled that the Tribunal did not exceed its jurisdiction in inquiring into issues that arose after contract award since the government had re-opened its evaluation after the initial award. The dispute dealt with a Department of Defence Request for Proposals (RFP) for senior technician services. The complainant was initially awarded the contract, but that contract was terminated after the government revisited its evaluation and award decision.
As the Court summarized, the Tribunal determined that the review of the termination decision was within its jurisdiction since it had jurisdiction over contract award decisions:
In its reasons, the Tribunal reviewed the relevant trade agreements and found that they provide that the procurement process “begins after an entity has decided on its procurement requirement and continues through the contract award” (Reasons at para. 30, citing article 514(2)(a) of the Agreement on International Trade and article 1017(1)(a) of the North American Free Trade Agreement). The Tribunal accordingly agreed that matters of contract administration were beyond its jurisdiction. However, the Tribunal ultimately concluded that the complaint came within section 30.11 of the Act because Valcom’s complaint concerned an aspect of the procurement process. In this regard, it determined that the procurement process continued in this case when DND reconsidered some of the bids after the contract with Valcom had been entered into (Reasons at para. 33). The Tribunal held:
Given that the complaint concerns aspects of the procurement process, the mere fact that the procurement process appears to have continued beyond the initial award of the contract does not deprive the Tribunal of jurisdiction. The information before the Tribunal relating to the “various concerns [that] have been raised with regards to [the request for proposals]” indicates that DND re-engaged the procurement process after awarding the contract to Valcom, and that these actions were integral to the procedures followed in respect of the designated contract. In fact, by DND’s own admission, concerns about the procurement process caused it to retract Valcom’s contract and retender the requirement. In such circumstances, the fact that the procurement process continued beyond the initial award of a contract cannot allow DND to eschew the disciplines of the trade agreements.
The Attorney General submits that this decision is inconsistent with prior decisions of the Tribunal to the effect that it has no jurisdiction over contract administration. However, the Tribunal’s decision is not inconsistent with these authorities.
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In my view, the Tribunal reasonably concluded that the issue in the complaint relates to a procurement process over which it has the authority to inquire into pursuant to section 30.11 of the Act. The Tribunal’s reasons, as well as its conclusion, are reasonable.
The Court of Appeal upheld the Tribunal’s ruling and ordered the government to re-instate the initial contract award due to the flawed post-award re-evaluation and termination decision.
As this case illustrates, when purchasing institutions re-open their evaluation and award decisions after making initial contract awards, they may be subjecting themselves to renewed procedural challenges by impacted parties.
