Orillia’s relationship with a large construction firm announced with anticipation in 2016 broke down into a series of disputes and finger pointing as the development of the Orillia Recreation Centre plodded along, opening two years behind schedule.
A lawsuit that has been wending its way through the courts for the past two years suggests there were a series of problems in the construction of the facility, resulting in delays and disagreement.
The Atlas Corporation launched a lawsuit against the city in 2021 for $539,227.66. The bill for labour and material to improve the land at the centre that included seeding, sodding, completing door hardware, soffit flashing, painting, sealants, and miscellaneous metal, signs, lockers and mechanical work remained unpaid, it charged. Atlas claimed a lien on the property to collect what it said it was owed.
The amount being sought represents close to 10 per cent of the $59.5-million contracted price for the facility.
But in a lengthy statement of defence and counterclaim, the city denied it owed Atlas anything. It also denied that Atlas qualifies for a lien against the property.
The city claimed, instead, it is owed $117,804 from Atlas and that Atlas breached its contract and was “negligent.”
In its counterclaim, the city is seeking $715,404 in damages for the delayed completion of the project in addition to $215,000 for deficiencies, which it said the company refused to correct.
“Orillia claims that based on its rights under the contract and at law, Atlas owes Orillia a minimum of $913,584.31 in delay damages and costs to correct deficiencies in Atlas’ work,” the city concludes in its pleadings dated a year ago.
The city claims Atlas failed to properly correct deficiencies related to roof/building envelope/skylight leaks. It further charged Atlas used “insufficient” labour, resulting in reduced productivity and self-inflicted delay and that it failed to mitigate other delays.
Orillia also claims Atlas failed to pay its subcontractor, resulting in a construction lien as well as the subcontractor’s refusal to honour the warranties.
“Atlas is required to have complete control of the work and was solely responsible for the construction means, methods, techniques, sequences and procedures, and for co-ordinating the various parts of the work under the contract. Atlas failed and/or refuses to acknowledge its errors, omissions, negligence and breaches of the contract and that Atlas and its subcontractors delayed the progress of the work,” reads the city’s pleadings with the court, which is followed by a list of 10 complaints about the construction company’s work.
The city points to subcontractor Hans Steel as being the major source of the delay, referring to a $5.6-million lawsuit it said Atlas launched against that company in 2020.
The city claims it is entitled to the costs it incurred as a result, including $304,158.57 for environmental monitoring arising from the delay and $411,245 in additional staff time that was required.
“In supplying services and materials for the work under the contract, Atlas owed a duty of care to Orillia. At all material times, Atlas knew or ought to have known that inadequate or improper construction means, methods, techniques, sequences and procedures would lead to delays in the completion of the work and would cause Orillia to incur costs and suffer damages,” the city claims in the legal documents.
Atlas, in reply a few days later, denied all of the accusations.
“Atlas strictly denies any allegation that it has breached the contract. To the contrary, Orillia breached the express terms of the contract by, including but not limited to, not paying Atlas and significantly delaying the project,” it responded in the documents. “Atlas complied (with) at all material times with the terms of the contract, and with its obligations at law.”
In denying responsibility for the delays, Atlas pointed the finger at Orillia.
Atlas asserts there were no defects, deficiencies or delays and that it provided good work, and wrote that there are no merits to the city’s claims and that they should be dismissed. Any problems, it adds, were fixed.
The case appeared briefly before Justice Mark Edwards on Tuesday with another date scheduled in December and a date for a motion to be determined later.
Through its spokesperson, the city indicated it doesn’t provide public comment on ongoing litigation files.
The law firm representing Atlas did not respond to a request for comment prior to publication.
Atlas won the $48.4-million contract in 2016 to build Orillia’s new recreation centre at 255 West St. S., but during the course of the work, the contract price increased to $52.5 million.
The 132,801-square-foot facility opened in October 2020 featuring an aquatic centre, a gym with two basketball courts and a viewing area, a multi-purpose room, a walking/jogging track, a preschool room, office space and a fitness centre.
