Purchasing

Dispute resolution process

Any bid protests prior to award should be directed to purchasing@winnipeg.ca

There are two main dispute resolution formats utilized by the City.  In some individual cases there can be other processes such as arbitration or other models in contracts which are negotiated on a single source basis and/or where the City’s standard documents/contracts are not the foundation of the contract formed.

• Standard Bid Opportunities (Tenders, RFP)
• Major Project Procurements

Standard Bid Opportunities (Tenders, RFP)

The current version of the various General Conditions contains the following Dispute Resolution clause.

Dispute resolution

C21. Appeals & Requests for Appeals

C21.1	If the Contractor disagrees with a Final Determination of the Contract Administrator he may, within seven (7) Calendar Days after receiving notice of the Contract Administrator's Final Determination, submit a properly completed Dispute Resolution Process Application Form (“Application Form”)as set out on the City’s Purchasing Website, to the City of Winnipeg Legal Services Department (“Legal Services”) at the address specified therein.
C21.2	The Appeal Process detailed in C21.3 through C21.10 (“Appeal Process”) will only be available to Contractors where the disagreement under C21.1 is with respect to factual matters. There will be no access to the Appeal Process for disagreements with respect to legal matters. Legal Services is the sole and final authority to determine whether an Application Form raises a Disputed Matter that is a factual dispute and suitable for the Appeal Process, and no appeal is available to the Contractor from such a determination. If the Contractor neglects or fails to observe fully and faithfully the above and following conditions for participation in the Appeal Process, he shall be deemed to have waived any ability to participate in the Appeal Process with respect to the Disputed Matter.
C21.3	Within ten (10) Business Days of the receipt by Legal Services of the Application Form pursuant to the above C21.1, Legal Services shall: review the Application Form to determine if the matter(s) contained therein (“Disputed Matter”) are permitted under the Appeal Process with respect to factual matters as provided in the above C21.2, and; issue a letter to the Contractor identifying Legal Services’ determination (“Legal Services Response Letter”).
C21.4	If Legal Services has determined that the Disputed Matter may proceed in the Appeal Process, the Contractor and Contract Administrator’s management level representatives (including the applicable Department head) must, within fifteen (15) Business Days of the date of the Legal Services Response Letter, begin negotiations in good faith on the Disputed Matter. Both the Contractor and Contract Administrator’s representatives must make all reasonable good faith efforts to resolve the Disputed Matter.  As these negotiations are not an adjudicative hearing, neither party may have legal counsel present during the negotiations.
C21.5	If the negotiations required by C21.4 do not successfully resolve the Disputed Matter within thirty (30) Business Days of the date of the Legal Services Response Letter, the Contractor must, within ten (10) Business Days of the end of the period provided in this C21.5 for negotiations, or of the date the parties otherwise agree negotiations have failed, submit his written Appeal  Form, in the manner and format set out on the City’s Materials Management Website, to the Chief Administrative Officer, and to the Contract Administrator. The Contractor may not raise any other disputes other than the Disputed Matter in his Appeal Form.
C21.6	The Contract Administrator shall submit an Appeal Form identifying his Department’s position to the Chief Administrative Officer and to the Contractor within ten (10) Business Days of the Contract Administrator’s receipt of the Contractor’s Appeal Form submitted pursuant to C21.5.
C21.7	The Contractor and Contract Administrator’s respective Appeal Forms, and documents appended by reference, must contain all information, known to that party to be relevant to the Disputed Matter, including relevant excerpts of the Contract. For the avoidance of doubt, sections of the Contract which are not relevant to the Disputed Matter, or any other irrelevant information or documents, should not be submitted in either Appeal Form.
C21.8	The City’s Chief Administrative Officer shall review the Appeal Forms submitted by the Contractor and Contract Administrator, and shall issue a written decision on the Disputed Matter contained therein (“CAO’s Determination”) within thirty (30) Business Days  of his receipt of the Contract Administrator’s Appeal Form (“CAO Review Period”). The Chief Administrative Officer may request additional documents or information once from either party at any time during the CAO Review Period, and may extend the CAO Review Period by up to thirty (30) Business Days following receipt of new information or documents, up to a maximum period of sixty (60) Business Days after the Chief Administrative Officer’s receipt of the Contract Administrator’s Appeal Form. If the Chief Administrative Officer has requested additional information or documentation from one party during the CAO Review Period, the other party shall also receive such additional information or documentation, and may issue a response thereto; however, each party is limited to one (1) additional response during the CAO Review Period.
C21.9	There is no opportunity for the parties to appear in person, or to present oral submissions to the Chief Administrative Officer.
C21.10	The CAO’s Determination may not be further appealed. If the Contractor disagrees with the CAO’s Determination he may request that the Disputed Matter be referred to arbitration in accordance with C21.11, by providing notice to the Chief Administrative Officer within seven (7) Calendar Days after receiving notice of the Chief Administrative Officer's determination.

Arbitration & Requests for Arbitration

C21.11	If, at any time before the termination of the warranty period (except as limited by the above C21.10), any dispute, difference or question shall arise between the City and the Contractor regarding the Work, then every such dispute, difference or question may, with the consent of the Chief Administrative Officer, on behalf of the City, and the Contractor, be referred to arbitration.  Notwithstanding that the parties may have consented to arbitration, no arbitration shall proceed before the date of Substantial Performance.
C21.12	The party desiring arbitration (the "Requesting Party") shall request the consent of the other party (the "Other Party") to refer a particular dispute, difference or question to arbitration.
C21.13	The Other Party shall reply to the request within seven (7) Calendar Days of receiving same.

Referral to a Single Arbitrator

C21.14	If the Other Party has consented to arbitration, the Requesting Party shall nominate an arbitrator (the “Requesting Party's Nominee") within seven (7) Calendar Days of receiving the reply.  The Other Party shall have seven (7) Calendar Days after receiving notice of the nomination to accept or reject the Requesting Party's Nominee.
C21.15	If the Other Party accepts the Requesting Party's Nominee, the dispute, difference or question shall be promptly referred to him.

Referral to a Panel of Arbitrators

C21.16	If the Other Party rejects the Requesting Party's Nominee, it shall, within seven (7) Calendar Days of rejection, appoint its own arbitrator.
C21.17	The Requesting Party shall, within seven (7) Calendar Days of receiving the Other Party's rejection, appoint its own arbitrator.
C21.18	The arbitrators appointed under C21.16 and C21.17 shall, within seven (7) Calendar Days of the date on which the last of them was appointed, appoint a third arbitrator (the "Panel Chair") who will act as chair of the arbitration panel.

General

C21.19	The Arbitration Act (Manitoba) or any successor legislation thereto shall apply to the arbitration in all respects except as expressly otherwise provided in these General Conditions.
C21.20	The single arbitrator or the Panel Chair, as the case may be, shall determine the procedure to be followed in the arbitration, which shall be consistent with The Arbitration Act (Manitoba) or any successor legislation thereto.
C21.21	Where the matter proceeds with a single arbitrator, each party shall be responsible for its own legal expenses, expenses to produce expert evidence or other expenses voluntarily incurred, and for an equal share of the fees and expenses of the single arbitrator and of any other expenses related to the arbitration.
C21.22	Where the matter proceeds with an arbitration panel, each party shall be responsible for its own legal expenses, expenses to produce expert evidence or other expenses voluntarily incurred, for the fees and expenses of the arbitrator appointed by it, and for an equal share of the fees and expenses of the Panel Chair and of any other expenses related to the arbitration.

Dispute resolution

D35. Dispute Resolution

D35.1	If the Contractor disagrees with any opinion, determination, or decision of the Contract Administrator, the Contractor shall act in accordance with the Contract Administrator’s opinion, determination, or decision unless and until same is modified by the process followed by the parties pursuant to D35.
D35.2	The entire text of C21.4 is deleted, and amended to read: “Intentionally Deleted”
D35.3	The entire text of C21.5 is deleted, and amended to read: If Legal Services has determined that the Disputed Matter may proceed in the Appeal Process, the Contractor must, within ten (10) Business Days of the date of the Legal Services Response Letter, submit his written Appeal Form, in the manner and format set out on the City’s Purchasing Website, to the Chief Administrative Officer, and to the Contract Administrator. The Contractor may not raise any other disputes other than the Disputed Matter in his Appeal Form.
D35.4	Further to C21, prior to the Contract Administrator’s issuance of a Final Determination, the following informal dispute resolution process shall be followed where the Contractor disagrees with any opinion, determination, or decision of the Contract Administrator (“Dispute”): In the event of a Dispute, attempts shall be made by the Contract Administrator and the Contractor’s equivalent representative to resolve Disputes within the normal course of project dealings between the Contract Administrator and the Contractor’s equivalent representative. Disputes which in the reasonable opinion of the Contract Administrator or the Contractor’s equivalent representative cannot be resolved within the normal course of project dealings as described above shall be referred to a without prejudice escalating negotiation process consisting of, at a minimum, the position levels as shown below and the equivalent Contractor representative levels: The Contract Administrator; Supervisory level between the Contract Administrator and applicable Department Head; Department Head.
D35.5	Names and positions of Contractor representatives equivalent to the above City position levels shall be determined by the Contractor and communicated to the City at the pre-commencement or kick off meeting.
D35.6	As these negotiations are not an adjudicative hearing, neither party may have legal counsel present during the negotiations.
D35.7	Both the City and the Contractor agree to make all reasonable efforts to conduct the above escalating negotiation process within twenty (20) Business Days, unless both parties agree, in writing, to extend that period of time.
D35.8	If the Dispute is not resolved to the City and Contractor’s mutual satisfaction after discussions have occurred at the final escalated level as described above, or the time period set out in D35.7, as extended if applicable, has elapsed, the Contract Administrator will issue a Final Determination as defined in C1.1(v), at which point the parties will be governed by the Dispute Resolution process set out in C21.

Major Project Procurements

There is no one set standard for contracts, or Dispute Resolution process within those contracts for Major Projects (projects that are multi-millions, longer term and/or complex projects that necessitate a complex Dispute Resolution structure).

Initially in 2008, prior to each City P3 project and most recently prior to the NEWPCC Headworks Project, the City conducted analyses of the current industry accepted procurement models and best practices in Dispute Resolution, always in consultation with external experts in the field.

The two Schedules attached are templates based on the NEWPCC Headworks project, are provided as information and would be the basis for upcoming Major Capital Projects.   The procurement phase of a Major Capital Project includes a negotiation process on the Project Agreement terms and conditions that result in a contract that is tailored to the specific project.

As part of the procurement for a Major Capital Project, an independent third party expert (“Referee”) is jointly engaged by the City and the Design-Builder (Project Co) through an RFP.   Representatives of both the City and the Design-Builder (Project Co) participate in development of the RFP to engage the Referee and evaluation of the Proposals submitted in response to it.  The resulting contract is a tri-party agreement in order that the third party expert is neutral as between the Design-Builder (Project Co) and the City. Both parties equally share the cost.

Further details are set out in the Dispute Resolution schedule and the Referee Agreement that both form part of the Design Build Agreement. Please note these Schedules are taken somewhat out of context because there are many other schedules and hundreds of pages to a Design Build Agreement (Project Agreement), with an entire Definitions schedule, etc., however this sets out the basic structure with respect to Dispute Resolution for Major Projects.