Date: 20070607
Docket: A-193-07
Citation: 2007 FCA 219
Present: RYER
J.A.
BETWEEN:
TPG TECHNOLOGY CONSULTING LTD.
Applicant
and
THE MINISTER OF PUBLIC WORKS AND
GOVERNMENT SERVICES
and CGI GROUP INC.
Respondents
REASONS FOR ORDER
RYER J.A.
[1]
TPG
Technology Consulting Ltd. (“TPG”) has applied to this Court for judicial
review of a decision of the Canadian International Trade Tribunal (the “CITT”),
dated April 3, 2007, refusing to undertake an inquiry into two complaints made
by TPG. These complaints alleged irregularities and improprieties in respect of
the evaluation of TPG’s bid for a contract (the “Pending ETS Contract”) to
provide engineering and technical services to the Information Technology
Services Board (“ITSB”) of Public Works and Government Services Canada
(“PWGSC”). The Pending ETS Contract is to be awarded in response to a request
for proposals (the “RFP”) that was issued by PWGSC under solicitation no. EN
869-040407/A.
[2]
The basis
of the CITT’s refusal to conduct an inquiry into the two complaints was that
both of them were time-barred pursuant to subsections 6(1) and (2) of the Canadian
International Trade Tribunal Regulations S.O.R./93-602 (the “CITT
Regulations”). In its judicial review application, TPG alleges that the CITT
made jurisdictional and legal errors in arriving at its decision.
[3]
This
application is for an interim order, pursuant to section 18.2 of the Federal
Courts Act R.S.C. 1985, c. F-7, prohibiting the Minister of Public Works
and Government Services (the “Minister”) from awarding the Pending ETS Contract
until this Court renders its decision in the application for judicial review. TPG
has also applied for an order expediting the hearing of the judicial review
application by this Court.
BACKGROUND
[4]
TPG is
presently providing engineering and technical support services to PWGSC under a
contract that is to expire on June 15, 2007. That expiry date has been extended
to July 15, 2007, by virtue of an order of Malone J.A. dated May 10, 2007.
[5]
The RFP in
respect of the Pending ETS Contract was issued on May 30, 2006. Three
corporations submitted bids in response to the RFP: TPG, CGI Group Inc. (“CGI”),
one of the respondents, and IBM Canada Ltd.
ANALYSIS
The section 18.2 order
[6]
It is
common ground that the test to be applied with respect to the granting of the
interim order that has been requested by TPG is the test that was set forth by
the Supreme Court of Canada in RJR−MacDonald Inc. v. Canada (Attorney
General), [1994] 1 S.C.R. 311. Accordingly, to succeed on this motion, TPG
must satisfy the Court that there is a serious question to be tried, that it
will suffer irreparable harm if the interim order is not granted and that the
balance of convenience favours the granting of the order.
1. Serious Question
[7]
In RJR-MacDonald,
the Supreme Court of Canada specified that there is a low threshold with
respect to the determination of whether there is a serious issue to be tried
and that if a preliminary assessment, and not a prolonged examination, of the
merits of the issue reveals that it is neither frivolous nor vexatious, then
the motions judge should proceed to consider the other two elements of the test.
[8]
In this
element of the test, the question is whether TPG has raised a serious issue for
this Court to determine in the judicial review application. Accordingly, it is
necessary to consider the circumstances surrounding the decision of the CITT
that is the subject of that application.
[9]
TPG filed
its complaint with the CITT on March 23, 2007. In that complaint, TPG alleged
that PWGSC did not evaluate the bids fairly, impartially and in accordance with
its published criteria because of the occurrence of a re-confirmation process
performed by a single evaluation team member, which was not contemplated in the
RFP (the “First Complaint”). TPG also alleged that a reasonable apprehension of
bias and/or an appearance of conflict of interest was present in the bid
evaluation process arising out of the appointment of Mr. Jirka Danek as
Director General of Products and Services of ITSB on June 5, 2006, his prior
involvement with TPG and CGI and his proximity to, and potential involvement
in, the bid evaluation process (the “Second Complaint”). Both of TPG’s complaints
were rejected by the CITT.
[10]
Under subsection 6(1) of the CITT Regulations, a
complaint must be filed with the CITT “… not later than 10 working days after
the day on which the basis of the complaint became known or reasonably should
have become known to the potential supplier.” Subsection 6(2) of the CITT Regulations
states that a potential supplier who has made an objection to the relevant
government institution, and is denied relief by that government institution,
may file a complaint with the CITT “… within 10 working days after the day on
which the potential supplier has actual or constructive knowledge of the denial
of relief, if the objection was made within 10 working days after the day on
which its basis became known or reasonably should have become known to the
potential supplier.”
[11]
With respect to the First Complaint, the CITT
determined that since TPG first learned of the re-confirmation process in
November of 2006, and later learned of its completion on or about February 26,
2007, the complaint that was brought on March 23, 2007, was time-barred by
subsection 6(1) of the CITT Regulations.
[12]
With respect to the Second Complaint, the CITT referred
to a letter from TPG to ITSB, dated May 29, 2006, in which TPG expressed
concerns regarding the status of Mr. Danek and the conflict of interest it might
create if he were to accept an executive position with ITSB. On June 2, 2006,
the Chief Executive Officer of ITSB responded, indicating that TPG should have
no concerns about conflict of interest on Mr. Danek’s part because he would not
be involved in procurement and contracting activities. As a result, the CITT determined that the
reply of June 2, 2006, constituted a denial of relief with regard to TPG’s
objection to Mr. Danek’s appointment and that TPG’s complaint on March 23,
2007, which they found to be related to that denial, was filed beyond the time
limit established by subsection 6(2) of the CITT Regulations.
[13]
In its
application for judicial review, TPG alleges that the CITT erred in law and
jurisdiction by refusing to inquire into those complaints on the basis that
they were time-barred.
[14]
With
respect to the First Complaint, TPG alleges that the 10 day time period should not
have commenced on the date in November of 2006 upon which it learned of the
re-confirmation process. Instead, it alleges that the time period should have commenced
on March 13, 2007, the date upon which it established that the re-confirmation
process actually had an adverse impact upon its bid. In effect, TPG alleges that
the bid re-confirmation actually became a bid re-evaluation that was
impermissible under the RFP.
[15]
With
respect to the Second Complaint, TPG noted that subsection 30.11(1) of the Canadian
International Trade Tribunal Act R.S.C.
1985, c. 47 (4th Supp.) (the “CITT Act”) provides that complaints may be made if
they relate to “any aspect of the procurement process”. TPG then alleged that
because its May 29, 2006 letter to ITSB, in which the conflict of interest
matter was raised, was sent before the commencement of the procurement process,
that letter could not have constituted a complaint under the CITT Act. It
follows, according to TPG, that the CITT was in error in concluding that the
June 2, 2006 response from ITSB was a denial of relief under the CITT Act. In
addition, TPG alleged that because the June 2, 2006 response provided a
positive assurance to TPG, it could not be construed as a “denial of relief”. Finally,
TPG alleges that it was only on March 13, 2006, when it established that it had
ceased to be the winning bidder and had become a losing bidder, that the
alleged concerns in relation to an apprehension of bias or conflict of interest
could be said to have had an adverse impact on its bid. On that basis, it
alleges that the 10 day period must be computed from March 13, 2007.
[16]
In my
view, the issues raised by TPG in its application for judicial review are
neither frivolous nor vexatious and they meet the low threshold of the “serious
issue to be tried” element of RJR-MacDonald test.
[17]
Counsel
for the respondents argued that there was no evidence that there had been any
re-evaluation of the bids or the bid scores and further, that there was no
evidence that Mr. Danek had any involvement in the bid process. In my view, it
is not appropriate for me to consider these matters since the CITT did not deal
with them. Instead, the CITT declined to inquire into the complaints on the
basis that they were time-barred. It is that determination that will be before
this Court on the judicial review application and, in accordance with the first
element of the RJR-MacDonald test, it is only the seriousness of the
issues that are to be tried in that application that require consideration in
the application that is before me.
[18]
Counsel
for CGI argued that the decision of this Court in IBM Canada Ltd. v.
Hewlett-Packard (Canada) Ltd., [2002] F.C.J. No. 1008, 2002
FCA 284, makes it clear that the question of the timeliness of a complaint
before the CITT is a factual matter that will be subject to judicial review on
a standard of patent unreasonableness. He then urged me to conclude that the
decision of the CITT to reject TPG’s complaints was not patently unreasonable
and based upon that conclusion, to determine that the low threshold in relation
to the serious issue element of the test had not been met.
[19]
In the
application before me, it is not my function to determine the appropriate
standard of review that is to be applied by this Court in the judicial review
application, much less to determine whether that standard has been met. Rather,
I am only obliged to consider whether the grounds contained in TPG’s application
for judicial review raise serious issues, that is to say, issues that are neither
frivolous or vexatious.
[20]
In concluding
that the issues that have been raised by TPG for consideration in the judicial
review application have met the serious issue element of the test, I would
emphasize that I am expressing no opinion as to the ultimate resolution of those
issues.
2. Irreparable harm
[21]
The second
element of the test is that of irreparable harm, which is described in RJR-MacDonald
at page 341:
At this stage the only
issue to be decided is whether a refusal to grant relief could so adversely
affect the applicants’ own interests that the harm could not be remedied if the
eventual decision on the merits does not accord with the result of the
interlocutory application.
“Irreparable” refers to
the nature of the harm suffered rather than its magnitude. It is harm which
either cannot be quantified in monetary terms or which cannot be cured, usually
because one party cannot collect damages from the other. Examples of the former
include instances where one party will be put out of business by the court’s
decision (R.L. Crain Inc. v. Hendry (1988), 48 D.L.R. (4th) 228 (Sask.
Q.B.)); where one party will suffer permanent market loss or irrevocable damage
to its business reputation (American Cyanamid, supra); or where a
permanent loss of natural resources will be the result when a challenged
activity is not enjoined (MacMillan Bloedel Ltd. v. Mullin, [1985] 3
W.W.R. 577 (B.C.C.A.)). The fact that one party may be impecunious does not
automatically determine the application in favour of the other party who will
not ultimately be able to collect damages, although it may be a relevant
consideration (Hubbard v. Pitt, [1976] Q.B. 142 (C.A.)).
[22]
The
evidence before me shows that the existing service arrangement between TPG and
ITSB accounts for approximately 70% of the gross revenues of TPG. In addition,
TPG employs a number of subcontractors and employees in the provision of those
services.
[23]
Having
regard to the criteria for this element of the test, I am persuaded that the
loss of such an important contract prior to the outcome of the judicial review
application could cause irreparable harm to TPG, which could manifest itself in
a permanent loss of business, a permanent loss of skilled employees and
experienced subcontractors, an inability to obtain new large government
contracts and damage to its reputation. To that extent, TPG may be said to be
in circumstances that are similar to the applicants for similar orders in Profac
Facilities Management Services Inc. v. FM One Alliance Corp., [2001] F.C.J.
No. 1530, 2001 FCA 303, and Seprotech Systems Inc. v. Peacock Inc.,
[2002] F.C.J. No. 1764, 2002 FCA 497. Accordingly, I conclude that this
element of the test has been met.
3. Balance of Convenience
[24]
The third
element of the test requires a determination of which of the parties would
suffer greater harm from the granting or the refusal to grant the interim order,
pending the outcome of the decision on the merits.
[25]
In
applying the second element of the test, I concluded that TPG could suffer
irreparable harm if the interim order is not granted.
[26]
Counsel
for CGI expressed a strong desire that the Minister should be permitted to
award the Pending ETS Contract as soon as possible but tendered no evidence of
harm that CGI would suffer if there was a delay in awarding that contract.
[27]
Counsel
for the Minister conceded that it would suffer no harm by virtue of a delay in
awarding the Pending ETS Contract provided that there was an assurance that the
existing service that TPG is currently providing would continue during the
period from July 15, 2007 to and including the end of a 60 day transition
period following the date upon which the Pending ETS Contract is awarded, in
the event that TPG is not the recipient of the award of that contract. While
that latter concern is valid, it is a matter that can be dealt with as a
condition of any interim order that is granted.
[28]
In my
view, the balance of convenience weighs in favour of TPG. Without the interim
order, there is a definite possibility that the Pending ETS Contract could be
awarded to another bidder before this Court hears the judicial review
application. Such an action on the part of the Minister could result in the
harm to TPG that was described above. That harm, in my view, would be more
significant to TPG than any harm that would befall CGI if the interim order
were to be issued. Similarly, provided that the Minister’s requirement for
service continuity is met, the potential harm to TPG if the interim order is
not granted would be greater than the potential harm to the Minister if the
interim order were to be issued.
[29]
For these
reasons, I am persuaded that the three part test in RJR-MacDonald has
been met and that the interim order should be granted to TPG on the condition
that TPG will continue to provide the service that it is currently providing
under the existing contract with ITSB during the period from July 15, 2007 to
and including the end of a 60 day transition period following the date upon
which the Pending ETS Contract is awarded to a bidder other than TPG, or such
earlier date as ITSB and TPG may agree upon.
Expedited hearing of judicial review application
[30]
The
application for an expedited hearing of the judicial review application was not
opposed and I am willing to grant an order to that effect.
CONCLUSION
[31]
In
accordance with the terms of the accompanying order, the Minister is prohibited
from awarding the Pending ETS Contract and the hearing of the application for
judicial review of the decision of the CITT is expedited.
[32]
Costs
should be in the cause.
“C. Michael
Ryer”
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