RTG and contractor fight $12.8M LRT suit by Hardrock Concrete

Ottawa LRT builder Rideau Transit Group and its general contractor on the Confederation Line project have pushed back against a subcontractor's $12.8-million lawsuit, claiming Hardrock Concrete isn't owed any money and that company breached its subcontract by failing to remit taxes to the Canada Revenue Agency and leaving wages and union remittances unpaid.

OLRT Constructors, the transit project's general contractor and RTG's construction component, is countersuing for more than $10 million in damages, claiming there were “major deficiencies” in the work by Hardrock that the company refused or failed to fix, setting OLRT back an estimated $6.5 million to address the deficiencies. Hardrock also left the general contractor with damaged equipment, costs incurred because of excess rebound from sprayed concrete and overtime payments to work crews to try to overcome delays caused by Hardrock, they allege.

The statement of defence and counterclaim, filed last spring, have not been tested in court.

This newspaper reported on the story of Frank Schwenzer and his company, Hardrock Concrete, in March 2020. In a statement of claim filed one m

onth earlier against RTG, OLRT and the City of Ottawa, Schwenzer alleged Hardrock was owed more than $10.8 million for its Confederation Line work, which had been plagued by delays that OLRT was responsible for. The company incurred additional labour, material and other costs to complete the installation, the claim added.

It further alleged that the reputations of Schwenzer and his company had been irreparably damaged, the business of Hardrock Concrete “effectively destroyed” and that Schwenzer had suffered “anxiety and unnecessary stress” because of the defendants' behaviour.

Schwenzer did not respond to this newspaper on Friday.

In their statement of defence, RTG and OLRT deny all allegations in the statement of claim and deny that Hardrock and Schwenzer are owed the $12.8 million.

Hardrock was contracted to supply shotcrete (sprayed concrete) lining on the light-rail project for $4.7 million on or around March 4, 2016.

According to the statement of defence, “any and all delays to the project schedule, as defined in the subcontract, were the direct result of Hardrock's inability to have the resources, manpower and financial means to complete the subcontract work within the time frame required under the subcontract.”

OLRT claims it paid Hardrock nearly $6 million, including payments to two locals of the Labourers' International Union of North America and to CRA. The LiUNA locals came calling for $277,796.94 in December 2017 and another $140,577.28 in March 2018, amounts owed by Hardrock for unpaid wages and remittances, according to the statement of defence.

On or about Feb. 9, 2018, OLRT received requirements to pay from CRA “as a result of Hardrock's failure to make necessary tax remittances,” they allege. As a result, OLRT made a payment of more than $496,000 to CRA.

“OLRTC maintains that there are no amounts owing to Hardrock, but, rather, Hardrock is indebted to OLRTC,” the statement of defence alleges. Why? Breaches of the subcontract, costs associated with completing and rectifying deficiencies in subcontract work and warranty obligations, and having to make payments to the union locals and CRA, they say.