John Chandioux Experts Conseils Inc. v. Canada (Department of Public works and government services), 2004 FCA 118

Date: 20040323

Docket: A-50-02

Citation: 2004 FCA 118

CORAM:        DÉCARY J.A.

LÉTOURNEAU J.A.

NADON J.A.

BETWEEN:

JOHN CHANDIOUX EXPERTS-CONSEILS INC.

Applicant

and

THE DEPARTMENT OF PUBLIC WORKS AND GOVERNMENT

SERVICES OF THE GOVERNMENT OF CANADA

Respondent

Hearing held at Montréal, Quebec, on March 8, 2004.

Judgment rendered at Ottawa, Ontario, on March 23, 2004.

REASONS FOR JUDGMENT:                                                                                      NADON J.A.

CONCURRED IN BY:                                                                                                  DÉCARY J.A.

                                                                                                                           LÉTOURNEAU J.A.

Date: 20040323

Docket: A-50-02

Citation: 2004 FCA 118

CORAM:        DÉCARY J.A.

LÉTOURNEAU J.A.

NADON J.A.

BETWEEN:

JOHN CHANDIOUX EXPERTS-CONSEILS INC.

Applicant

and

THE DEPARTMENT OF PUBLIC WORKS AND GOVERNMENT

SERVICES OF THE GOVERNMENT OF CANADA

Respondent

REASONS FOR JUDGMENT

NADON J.A.

[1]        This is an application for judicial review of a decision by the Canadian International Trade Tribunal (the Tribunal), reference [2002] C.I.T.T. No. 9, dated February 13, 2002, by which the Tribunal dismissed a complaint filed by the applicant concerning the awarding by the respondent of a contract for a system for the automatic translation of weather reports for Environment Canada.

[2]        The applicant maintained that the respondent had awarded the contract to a bidder whose system did not conform to the essential requirements of the call for tenders, namely a system that would operate in a Windows environment. The Tribunal concluded that the system proposed by the said bidder, namely a LINUX system, met the requirements of the call for tenders, since it was consistent with the Windows environment and could operate on it.

[3]        The issue resulted from call for tenders No. EF116-001468/A, published by Public Works and Government Services Canada (PWGSC) on May 16, 2001, for a turnkey system of automatic translation of English-French and French-English weather reports for the Translation Bureau, weather section. Specifically, the call for tenders included the following requirement:

[TRANSLATION]

Automatic translation turnkey system from English to French and French to English operating on personal computers devoted exclusively to this use in a Windows environment.

[Emphasis added.]

[4]        The applicant, John Chandioux experts-conseils Inc., made a bid including a Windows system, while Stéphane Lachapelle Informatique (SLI) made a proposal including a LINUX system. On receipt of these bids both systems, consistent with the call for tenders, were tested over a period of two weeks to ensure that they were operating adequately 99% of the time. Both systems were found to be satisfactory.

[5]        On September 14, 2001, PWGSC found both systems consistent with the requirements of the call for tenders and awarded the contract to SLI.

[6]        On September 21, 2001, the applicant objected to this award, arguing inter alia that an essential requirement had not been observed by the successful bidder.

[7]        On October 1, 2001, the applicant filed a complaint with the Tribunal (PR-2001-029), asking the latter to cancel the contract awarded to SLI and award it to the applicant.

[8]        On October 15, 2001, the applicant filed a complaint application amended by the addition of an argument relating to unfair assessment and bias in the procedure for assessing bids (complaint PR-2001-032).

[9]        On February 13, 2002, the Tribunal dismissed complaint PR-2001-029 and allowed complaint PR-2001-032 in part. The Tribunal's decision on the second complaint is not the subject of an application for judicial review in this Court.

[10]      In its decision the Tribunal referred to section 11 of the Canadian International Trade Tribunal Procurement Inquiry Regulations, SOR/93-602 (the Regulations), which provides inter alia that when the Tribunal inquires into a complaint, it must determine whether the procurement contract was concluded in accordance with the requirements of the North American Free Trade Agreement between the Government of Canada, the Government of the United States of America and the Government of the United Mexican States, December 17, 1992 (1994) 32 Can. T.S. No. 2, I.L.M. 289 (in effect January 1, 1994 - NAFTA), the Agreement on Internal Trade (AIT), July 18, 1994, C. Gaz. 1995.I.1323, April 29, 1995, and the Agreement on Government Procurement, contained in Appendix 4 of the World Trade Organization Agreement, signed at Marrakech on April 15, 1994 (AGP). The Tribunal also referred to paragraph 1015(4)(d) of NAFTA, paragraph XIII(4)(c) of the AGP, which provides that the awarding of contracts must be consistent with the essential terms and conditions specified in the call for tenders, as well as subsection 506(6) of the AIT, which provides inter alia that the call for tender documents must clearly indicate the terms and conditions applied in assessing bids.

[11]      Based on these principles, the Tribunal dismissed the applicant's allegation that the system offered by SLI and accepted by the respondent did not meet the fundamental requirements of paragraph 2.6 of Appendix B of the call for tenders, which reads as follows:

The Bidder shall submit a detailed list of all the equipment it intends to supply to ensure the system runs smoothly and to allow interface with the Environment Canada network, i.e. 10/100 base T Ethernet and use of the TCP/IP Protocol Suite only. It will be the Translation Bureau's responsibility to decide whether the equipment supplied is adequate, after two-week test of the system. The system shall function in a Windows environment, and the proposed platform shall be recognized as reliable and secure according to industry standards and shall be approved by Environment Canada.

[Emphasis added.]

[12]      According to the Tribunal any system, Microsoft Windows or any other, that would operate in a Windows environment met the requirements of paragraph 2.6 of Appendix B and therefore was acceptable. The Tribunal said that in its opinion even if the system proposed by SLI was not a Windows environment, it still met the requirements of paragraph 2.6 of Appendix B, since the call for tenders did not require such an environment, but rather that any proposed system be compatible with such an environment and able to operate within it.

[13]      The applicant is asking the Court to conclude that the Tribunal's decision was based on errors of fact, namely:

            1.         the Tribunal erred regarding the phrase [TRANSLATION] "Windows environment" and gave it a meaning contrary to that accepted in the computer industry: in the applicant's submission, the phrases [TRANSLATION] "operating in a Windows environment" and "operating under the Microsoft Windows operation system" are synonymous;

            2.         the Tribunal erred in accepting the explanation provided by the respondent regarding compatibility with Environment Canada facilities (according to PWGSC, [TRANSLATION] "a requirement had to be included that clearly stated that the proposed system had to be able to operate in a Windows environment to ensure compatibility with Environment Canada's network"), as that explanation was inconsistent with the recognized meaning of the phrase [TRANSLATION] "Windows environment" in data processing and was contradicted by the actual situation of the said facilities, since some Environment Canada computers operate under UNIX, others under Windows;

            3.         the Tribunal erred in saying that LINUX is compatible with Windows since software developed for LINUX is not compatible with Microsoft Windows: in support of this assertion, the applicant relied on material evidence from Microsoft.

[14]      Consequently, the applicant submitted that the Tribunal should have concluded that the system proposed by SLI did not meet the essential requirements of the call for tenders.

[15]      According to the respondent, the only question before this Court is whether the Tribunal made a reviewable error in concluding that the SLI proposal was consistent with the call for tenders.

[16]      The respondent noted that the evidence relied on by the applicant as to the meaning of the phrase [TRANSLATION] "Windows environment" in the data processing industry was not before the Tribunal and so cannot be taken into account by this Court. Consequently, since there was no evidence in the record to support the applicant's argument, the respondent asked the Court to dismiss the application for judicial review.

[17]      Further, relying on the Supreme Court of Canada's judgment in Canada (Attorney General) v. Public Service Alliance of Canada, [1993] 1 S.C.R. 941, the respondent submitted that the standard of review applicable to the Tribunal's decision was that of the patently unreasonable decision. Since the interpretation adopted by the Tribunal for the phrase [TRANSLATION] "Windows environment" cannot be regarded as clearly unreasonable, there is no basis for intervention by this Court.

[18]      In the respondent's submission, the interpretation adopted by the Tribunal is entirely consistent with the purpose of clause 2.6 of Appendix B of the call for tenders. The applicant added that, by absolutely requiring a Microsoft Windows system, the effect of the interpretation the applicant is asking this Court to accept would be to create an unnecessary obstacle to trade contrary to paragraph 107(1) of the NAFTA, infringe subsection 107(3), which prohibits requiring a supplier to use or provide a product with a specific trade mark, and favour Microsoft Windows products contrary to paragraph 504(3)(b) of the AIT.

Applicable legislation

Analysis

[19]      For the reasons that follow, I consider that the applicant's application for judicial review should be dismissed.

Standard of review applicable to Tribunal's decision

[20]      The fundamental issue concerns the interpretation of a provision contained in a call for tenders for a procurement contract. In particular, the question is whether the Tribunal erred in concluding that the SLI submitted a bid consistent with the requirements set out in the call for tenders. Both paragraph 1015(4)(a) of NAFTA and paragraph 4(a) of article XIII of the AGP provide that for bids to be considered they must be consistent with the terms set out in the call for tenders.

[21]      Subsection 30.14(1) of the Canadian International Trade Tribunal Act provides that when the Tribunal is inquiring into a complaint concerning any aspect of the procurement process, the Tribunal must determine its validity on the basis of the procedures and requirements prescribed by regulation. The Canadian International Trade Tribunal Procurement Inquiry Regulations provide in section 11 that the Tribunal must determine whether the public contract is in accordance with the requirements set out in various international trade agreements, including NAFTA and AGP.

[22]      In Canada v. McNally Construction Inc., [2002] 4 F.C. 633, this Court concluded that since the incorporation of NAFTA, WTOA and AGP in federal legislation, the Tribunal had become the competent body to deal with challenges to procurement contracts falling within these agreements.

[23]      Additionally, this Court has several times concluded that where the conclusion of procurement contracts is concerned the Tribunal's decisions should be treated with a high degree of deference. For example, in Profac Facilities Management Services Inc. v. FM One Alliance Corp., [2001] F.C.J. 1755, our colleague Evans J.A. said the following at paragraphs 14 and 15 of his reasons:

[14]         The applicants concede that it is settled law in this Court that questions of fact and law decided by the Tribunal in the course of determining a procurement matter are reviewable on the most deferential administrative law standard, namely, patent unreasonableness. However, they submitted, the Court has also acknowledged that, should an issue arise that does not engage the Tribunal's expertise in matters of trade law, a less deferential standard should be applied.

[15]         The applicants derive these propositions from Siemens Westinghouse Inc. v. Canada (Minister of Public Works and Government Services), [2001] FCA 241, at para. 15, where the Court affirmed the position that it had taken in, for example, Canada (Attorney General) v. Symtron Systems Inc., [1999] 2 F.C. 514 (C.A.). When the Court is reviewing a decision of the Tribunal in a procurement matter, the pragmatic or functional approach indicates that the Tribunal is entitled to the high degree of judicial restraint embodied in the patent unreasonableness standard.

[Emphasis added.]

[24]      At paragraph 20 of his reasons Evans J.A. noted that the interpretation of contractual documents was part of the Tribunal's area of expertise:

[20]         First, in regulating the fairness and propriety of the procurement process in order to ensure compliance by government institutions with the relevant trade regime, the Tribunal is performing an exercise of considerable legal, factual and business complexity, in which it has extensive experience. Its work includes the scrutiny and construction of contractual documents, in order, for example, to determine the value of a contract, including any optional purchase provisions, for the purpose of deciding the applicability of the NAFTA procurement requirements (Article 1002), and to determine whether tenders are responsive to the conditions of participation (Article 1015). The Tribunal's area of expertise is indicated by its broad statutory mandate to investigate complaints "concerning any aspect of the procurement process that relates to a designated contract": Canadian International Trade Tribunal Act, R.S.C. 1985, c. 47 (4th Supp.), subsection 30.11(1).

[Emphasis added.]

[25]      Since the essential issue does not in any way affect the Tribunal's competence, or involve any question of law outside its expertise, there is no basis for applying a more severe standard of review, such as that of the correct decision or reasonable decision simpliciter preferred in other contexts (see e.g. Canada v. Mattel Canada Inc., [2001] 2 S.C.R. 100; Novell Canada Ltd. v. Canada, [2000] F.C.J. No. 951, at paragraph 3; Canada v. Symtron Systems Inc., [1999] 2 F.C. 514, at paragraph 45; Cougar Aviation Ltd. v. Canada, [2000] F.C.J. No. 1946, at paragraphs 25 and 26).

[26]      Accordingly, the Tribunal's decision must be considered by the standard of the patently unreasonable decision, which in the formulation adopted by the Supreme Court in Canada v. Public Service Alliance of Canada, [1993] 1 S.C.R. 941, at 964, involves determining what is "clearly irrational":

It is not enough that the decision . . . is wrong in the eyes of the court; it must, in order to be patently unreasonable, be found by the court to be clearly irrational.

[27]      InToronto (City) Board of Education v. O.S.S.T.F., District 15, [1997] 1 S.C.R. 487, Cory J. explained the meaning of the phrase "patently unreasonable" in the context of a point of law and in that of a finding of fact (at paragraphs 41, 42, 43 and 45):

41.           A number of decisions of this Court have considered the circumstances which will give rise to a finding that a decision of an administrative body is patently unreasonable. The test has been articulated somewhat differently for findings of fact and findings of law.

42.           Where a tribunal is interpreting a legislative provision, the test is:

. . . was the Board's interpretation so patently unreasonable that its construction cannot be rationally supported by the relevant legislation and demands intervention by the Court upon review?

See [1979] 2 S.C.R. 227">Canadian Union of Public Employees, Local 963 v. New Brunswick Liquor Corporation, [1979] 2 S.C.R. 227, at p. 237.

43.           A slight variation of this test applies to arbitrators interpreting a collective agreement. In those circumstances, a court will not intervene "so long as the words of that agreement [the collective agreement] have not been given an interpretation which those words cannot reasonably bear": [United Brotherhood of Carpenters and Joiners of America, Local 579 v. Bradco Construction Ltd., [1993] 2 S.C.R. 316] at p. 341.

. . . . .

45.           When a court is reviewing a tribunal's findings of fact or the inferences made on the basis of the evidence, it can only intervene "where the evidence, viewed reasonably, is incapable of supporting a tribunal's findings of fact": Lester (W.W.) (1978) Ltd. v. United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry, Local 740, [1990] 3 S.C.R. 644, at p. 669 per McLachlin J.

Application of standard of review to Tribunal's decision

[28]      At page 9 of its reasons the Tribunal disposed of the question regarding the meaning of the phrase [TRANSLATION] "Windows environment" as follows:

In its comments on the GIR ["Government Institution Report"], Chandioux submitted that the issue is not what PWGSC meant, but what a bidder might reasonably infer from reading paragraph 2.6 of the RFP. The Tribunal finds that paragraph 2.6 clearly indicates that any system, Microsoft Windows or any other, that will operate in a Windows environment, meets the requirement of the paragraph and is, therefore, acceptable. It is true that the system proposed by SLI is not, in Chandioux's own words, "a Windows environment". However, the RFP did not require such an environment, but rather that any proposed system be compatible with such an environment and able to operate within it; this was documented and demonstrated by the system proposed by SLI, in PWGSC's opinion. In the circumstances, the Tribunal is of the view that PWGSC acted correctly in accepting the system proposed by SLI as meeting the requirements of paragraph 2.6 of the RFP.

[29]      In my view, the gist of the problem is not so much whether [TRANSLATION] "Windows environment" refers to the Microsoft Windows operation system, but rather what environment we are talking about: that of the system produced by the bidder (applicant's argument) or that of Environment Canada (respondent's argument).

[30]      It appears from reading the Tribunal's reasons that the latter refused to regard as valid the applicant's argument that [TRANSLATION] "Windows environment" referred to the environment of the system produced by the bidder and accepted the respondent's argument that the reference to a Windows environment was intended to ensure compatibility of the proposed system with the Environment Canada network, a network which the Tribunal appear to implicitly regard as a Windows environment.

[31]      Unfortunately for the applicant, I feel that based on the evidence presented to the Tribunal it is impossible for this Court to conclude that the interpretation accepted by the Tribunal was patently unreasonable.

[32]      At point C of its Memorandum and in this Court, the respondent maintained that the whole of the applicant's objection was based on allegations not proven before the Tribunal and had to do with facts of a scientific or technical nature which required expert evidence. I agree. At paragraphs 7 to 13 of its Memorandum the applicant, by way of providing the Court with some [TRANSLATION] "data processing benchmarks", referred to a number of concepts essential to its argument (turnkey system, computer platform, applications and others). It seems clear that this information is technical in nature and should have been entered in evidence before the Tribunal. There can be no doubt that this Court cannot take judicial notice of this information.

[33]      In the same way, at paragraphs 26 and 27 of its Memorandum the applicant bases an argument on its knowledge of the fact that certain Environment Canada computers operate under UNIX and others under Windows, which means that the [TRANSLATION] "Windows environment" mentioned in the call for tenders cannot be its own, which should more properly be described as a mixed environment. Clearly this information cannot be considered by this Court simply based on the applicant's statements.

[34]      It should be noted that at the start of the hearing in Montréal on March 8 last, the applicant filed a motion to introduce evidence in this Court of extracts from technical dictionaries and an expert report by Georgette Blanchard, dated September 24, 2002, regarding the interpretation of paragraph 2.6 of Appendix B of the call for tenders. After hearing the submissions of counsel, the Court dismissed the applicant's motion.

[35]      To conclude, in my opinion there was no evidence before the Tribunal to support the applicant's assertions, which are technical in nature and should have been documented by exhibits and relevant testimony. As this Court cannot consider any evidence other than that presented to the Tribunal, it follows that even if the applicant's reading of the relevant clauses of the call for tenders were what a reasonable engineer would have given, the applicant presented no evidence to the Court on which it could conclude that the Tribunal's decision was patently unreasonable.

[36]      Accordingly, I would dismiss the application for judicial review with costs.

"I concur.

Robert Décary J.A."

"I concur.

Gilles Létourneau J.A."

Certified true translation

Suzanne M. Gauthier, C Tr, LLL

                                                  FEDERAL COURT OF APPEAL

                                                      SOLICITORS OF RECORD

DOCKET:                                                                   A-50-02

STYLE OF CAUSE:                                                   JOHN CHANDIOUX EXPERTS-CONSEILS INC.

Applicant

and

THE DEPARTMENT OF PUBLIC WORKS AND GOVERNMENT SERVICES OF THE GOVERNMENT OF CANADA

Respondent

PLACE OF HEARING:                                             Montréal, Quebec

DATE OF HEARING:                                               March 8, 2004

REASONS FOR JUDGMENT:                                NADON J.A.

CONCURRED IN BY:                                              DÉCARY J.A.

LÉTOURNEAU J.A.

DATE OF REASONS:                                               March 23, 2004

APPEARANCES:

John MacDougall                                                           FOR THE APPLICANT

Bernard Letarte                                                             FOR THE RESPONDENT

SOLICITORS OF RECORD:

McIninch, MacDougall                                                  FOR THE APPLICANT

Montréal, Quebec

Morris Rosenberg                                                          FOR THE RESPONDENT

Deputy Attorney General of Canada

Ottawa, Ontario