onus being blamed on two people pointing at each other

Adlair Aviation (1983) Ltd. v. Commissioner of Nunavut, Governor of Nunavut and Mark McCulloch, 2017 NUCJ 19

This issue first came to court when the plaintiff, Adlair Aviation (1983) Ltd. (“Adlair”) began an action seeking damages and other remedies in December 2012. Adlair had unsuccessfully responded to a 2011 RFP from the Government of Nunavut (“GN”) for the provision of air ambulance services for the Kitikmeot Region. After some preliminary matters were handled, on April 27, 2017 the Nunavunmi Maligaliuqtiit (the Nunavut Court of Justice) heard the defendant’s arguments for a summary judgment to dismiss the plaintiff’s claim, which the court could grant if it found that the plaintiff’s claim was insufficiently strong to move to trial or to succeed here.

RFP For Air Ambulance Services

The background for the RFP is the lack of health facilities able to handle life-threatening trauma in most Nunavut communities, and the need for Nunavummiut, or the citizens of Nunavut, to rely on reliable air ambulances in order to be transported to the hospital in Iqaluit. The RFP closed on April 8, 2011 and explicitly stated that the Request was not for tenders, but only for proposals; moreover, the RFP included provisions stating that the GN was not bound to accept only the lowest-priced submission, but that proposal providing “the best potential value to the GN” (Provision 1.6).

GN’s RFP also included information about one of the government’s highest priorities: ensuring that Inuit, Local, and Nunavut businesses supply materials, equipment, services, and labour. This policy, known as the Nunavummi Nangminiqaqtunik Ikajuuti (“NNI”), was relevant to the RFP for air ambulances in Kitikmeot, and thus in order for proponents to receive an NNI benefit in adjusted prices, proponents needed to include specific information, such as the names of subcontractors, in their responses. The RFP was clear that if no such information was included, no consideration, namely the bid price adjustments, would be available for that proposal.

Three separate companies submitted proposals: Adlair, Unaalik Aviation (2004) Inc., and Aqsaqniq Airways Ltd (“Aqsaqniq”) – the latter submitted four proposals, one of which was successful. In order to determine the winning proposal, a five-person Committee evaluated the six proposals on a line-by-line basis. Aqsaqniq’s Option C scored the most points, 1642, and their Option A scored 1630; however, the Department of Health determined that Option A was preferable as it included the use of a Learjet.

Adlair’s proposal, which did not contain any of the required NNI information, came in fifth with 1544 points. The lack of NNI information did contribute to its lower score: Adlair received poor ratings for “Inuit Labour” and “Inuit Firm” in both the “Air Ambulance Equipment” and “Air Medical Flight Crew” categories. Moreover, no bid price adjustment was given to Adlair, as it was to Aqsaqniq, since Adlair had not provided NNI information. However, after the contract was awarded to Aqsaqniq in 2011, Aqsaqniq was not immediately able to provide services, and GN did contract with Adlair to provide interim air ambulances.

Challenge to Contract Award

In August 2011, Adlair appealed the awarding of the contract to Aqsaqniq, and the matter was heard by the Nunavummi Nangminiqaqtunik Ikajuuti Contracting Appeals Board in September and October of 2011. The Board held that the award to Aqsaqniq was properly made and that it was not the responsibility of the Committee to contact proponents regarding missing required information.

Clarification Process

Adlair did not pursue judicial review of that decision until 2014, when the matter first came to the Nunavunmi Maligaliuqtiit. Adlair argued that a Committee member had called Aqsaqniq to confirm a detail in the proposal, but did not extend that service to Adlair to allow it to fill in the missing NNI information. The Committee member provided pre-trial evidence that he had called Aqsaqniq only to confirm numbers of staff and staff schedules, and further that the GN’s RFP allowed for that kind of communication between the Committee and proponents. The Committee member had also called the plaintiff to check the serial number of a plane, but did not inquire about the NNI information since, as the member stated, there were no questions to ask about it as the NNI information was absent.

The plaintiff argued further that because Aqsaqniq’s proposal listed a particular group of people as contacts, the proposal’s success was linked to a prior matter – the “Keewatin action.” In 2011, Kivallingmiut Aviation Inc. / Medic North Nunavut (“KAI/MNN”) responded to a parallel RFP for air ambulance services in the Kivalliq (Keewatin) Region. When KAI/MNN was unsuccessful, they launched a civil action seeking damages. KAI/MNN dropped the suit in September 2011, and the contacts listed on the unsuccessful KAI/MNN proposal were nearly identical to those listed on the successful Aqsaqniq proposal. Adlair’s counsel seemed to be arguing that KAI/MNN dropped the lawsuit against GN because they were awarded the Aqsaqniq proposal.

Onus of Proof

In claiming over $31 million in damages, Adlair claimed that the defendants breached their duty to be fair and just by considering Aqsaqniq’s proposals when GN allegedly knew that Aqsaqniq could not immediately provide those services and that Aqsaqniq proposed to use an allegedly illegal Learjet. Adlair’s counsel also stated that: “The defendants have not produced one scrap of evidence to say there was not a deal [regarding the KAI/MNN proposal].” Finally, Adlair stated that there was no onus on them to prove anything in their motion. Meanwhile, the defendants claimed that the Keewatin action was irrelevant; that Adlair’s proposal was faulty; that the Committee acted in good faith; and that there was no genuine issue requiring a trial.

The issue for the judge was: Has Adlair established a genuine issue that needs to go to trial in order to be determined?

Has Adlair proved that its claim deserves to proceed to trial or be found successful here? Is it up to the government to defend its’ conduct? You Be the Judge!

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The judge found many errors in the legal submissions from Adlair’s counsel: he called counsel’s advocacy “careless” and noted that the lawyer confused events and parties, referred to aircraft incorrectly, provided “rambling” and unfocused written arguments and oral pleadings, and provided absolutely no evidence for the plaintiff’s claims that Aqsaqniq proposed to use an ‘illegal’ Learjet or that GN was biased in favour of Aqsaqniq following the Keewatin action. Moreover, the plaintiff was incorrect in stating that they did not need to provide evidence showing a genuine issue for trial: plaintiffs need to do so according both to Part 12 of the Rules of the Supreme Court of the Northwest Territories as adopted for Nunavut, and to case law – see, for example, Hryniak v. Mauldin, 2014 SCC 7; Leishman v. Hoechsmann et al., 2016 NWTSC 27; and Sweda Farms Ltd. v. Egg Farmers of Ontario, 2014 ONCA 878. As the judge held in para 56, that assertion from the plaintiff indicated “a staggering ignorance of the law.”

Ultimately, the judge determined that Adlair’s motion could be dismissed on summary judgment. The lack of evidence provided by the plaintiff and the inconsistencies in their submissions were fatal to their claim. Further, the judge ruled that Adlair’s counsel had an ethical duty to familiarize himself with the law, and that he did not (para 57). He did not refer to Nunavut law or regulations in any of his submissions. Interestingly, at para 76 the judge stated in an aside that it was surprising that the plaintiff failed to plead a conspiracy in tort law.

This case exemplifies the importance of being clear on the legal framework and regulations governing the bidding and tendering processes in specific regions a company may operate in. Moreover, as industry increases in Nunavut, ensuring that RFPs in Nunavut include NNI information when requested is clearly paramount for hopeful respondents to RFPs.

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Readers are cautioned not to rely upon this article as legal advice nor as an exhaustive discussion of the topic or case.  For any particular legal problem, seek advice directly from your lawyer or in-house counsel.  All dates, contact information and website addresses were current at the time of original publication.