The U of M is being sued by a construction firm that was contracted to build the Churchill Marine Observatory — a multidisciplinary research facility located in Churchill.
In a lawsuit filed on Aug. 30 in the Court of King’s Bench, just three days after the facility’s grand opening, Penn-co Construction is seeking nearly $2.6 million. The company claims it is entitled to compensation for costs associated with compliance with COVID-19 protocols, inadequate design plans and delays in acquiring a necessary review by the department of fisheries and oceans.
According to the lawsuit, “the university has been unjustly enriched to the detriment of Penn-co.”
“It is the university’s position that all legitimate and eligible costs to Penn-co have been paid. In addition, the university has a significant claim against Penn-co for deficient work that will be set out in our statement of defense and counterclaim,” said the university’s general counsel in a statement.
The university and Penn-co entered contracts in 2017 and 2019 for phase 1 and phase 2 of the construction project, respectively. Altogether, contract work for the project was to amount to approximately $20.5 million.
The lawsuit mentions that Prairie Architects Inc. was hired to serve as a consultant during the construction. The architecture firm was responsible for providing administration “in an impartial and fair manner,” according to the lawsuit.
Penn-co alleges that requirements introduced during the COVID-19 pandemic led to significant costs and delays. The lawsuit states that Penn-co incurred approximately $400,000 to implement and comply with pandemic protocols. In April of 2020, the lawsuit mentions that Penn-co notified the university of cost and schedule impacts, with the intent to claim these additional costs. The project’s consultant disputed entitlement to these costs.
Penn-co is also seeking approximately $43,000 for an electrical control panel that was required but was allegedly absent in the phase 1 contract documents.
During phase 2 of construction, Penn-co and its drilling subcontractor encountered underground sand pockets which stopped drilling that was necessary for the project. The lawsuit claims that these sand pockets were not identified in the geotechnical report and the contract advertised the site as entirely dominated by bedrock. The university later directed Penn-co to proceed with a different drilling method which was completed in-part during winter months. The company claims it is entitled to nearly $2 million in additional costs.
Lastly, the lawsuit alleges that the university did not obtain a Manitoba conservation work permit which would require a review by the department of fisheries and oceans. This led to a delay which Penn-co is seeking an additional $167,000.
As of Sept. 12, the university has yet to file a statement of defense.
