Thu, September 20, 2007
Light rail lawsuits against city total $279M
By DEREK PUDDICOMBE, CITY HALL BUREAU

The lawsuit over the city's cancelled light-rail contract has grown to
$279 million.

St. Lawrence Cement Inc. has filed a statement of claim for $103.9
million, "arising out of the cancellation of the light-rail project."

The Dufferin Construction Co., a division of St. Lawrence Cement, was a
member of the consortium including Siemens Canada Ltd. and PCL
Contractors Canada Inc., which had successfully bid on the project.

In the statement of claim filed Sept. 14 in Brampton, St. Lawrence
Cement says it's suing the city for $40.5 million for "breach of
contract, economic negligence, interference with economic interests and
breach of duty of good faith." It also wants $31.7 million for work
completed and not yet paid for and it wants to be reimbursed another
$31.7 million it had already invested in the project.

As a result of not proceeding with the project, "Dufferin has suffered
substantial damages including loss of profits," the claim says.

Earlier this year, Siemens filed a $175-million lawsuit against the city
as a result of the cancelled $1-billion project.

Gloucester-Southgate Coun. Diane Deans said yesterday the latest
development is a "disaster."

"This is going from the biggest lawsuit in the city's history to the
city's biggest disaster," she said. "Instead of reviewing contracts that
haven't been awarded, Mayor (Larry) O'Brien might have wanted to think
about honouring the ones that have been awarded. It might have saved the
taxpayers a lot of money."

O'Brien said yesterday the city doesn't have a contract with any of the
companies suing the city over the light-rail issue.

"This is just more legal noise in the process," said O'Brien.

In the statement of claim, St. Lawrence Cement says in September last
year the city confirmed the $400-million contribution split between the
provincial and federal governments was intact, "construction of the LRT
line was in place and construction would commence on schedule in October
2006 in accordance with the terms of the project agreement."

The company also said in the claim the city was well aware that if it
abandoned the light-rail project "such conduct would cause economic
loss" to the companies involved.