Cambridge Plumbing Systems Ltd. v. Owners, Strata Plan VR 1632 (British Columbia Supreme Court)

The strata corporation invited bids for replacement of the corporation’s hot and cold domestic water system.  After bids were received, the strata corporation arranged for a required vote of owners to approve the project based upon the lowest bid (which came from the plaintiff, Cambridge).  The vote did not pass.  The strata corporation then entered into new negotiations with Cambridge and one of the other bidders (Brighter Mechanical Limited).  The strata corporation ultimately entered into a contract with Brighter.  Cambridge asserted that the strata corporation had unfairly and improperly rejected the bid from Cambridge.  Cambridge’s claim was dismissed.  The Court’s reasons included the following: 

• The owner has a duty of fairness, to all of the bidders, which applies throughout the tendering process.  Until the tendering process is over, either through acceptance of a bid, rejection of all bids, or when the irrevocability period has lapsed, the owner is obligated to treat all bidders fairly and equally in the consideration of the bids. 

• The evidence, in this case, does not support a conclusion that the owners or the strata council collectively orchestrated a negative vote in order to end the tendering process and/or enable them to negotiate with any or all of the bidders.

• The effect of the vote was to end the tendering process.

• The process, including the vote, was not unfair to any of the bidders, including Cambridge.

• Once the tendering process was over (i.e., all bids had been rejected) any subsequent negotiations were entirely legitimate.