Acciona sues Metro Vancouver for $250 million over North Shore plant

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The company says the delays and cost overruns were largely due to poor site and design flaws by Metro Vancouver.

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Responsibility for delays and cost overruns related to the construction of Metro Vancouver’s North Shore sewage treatment plant, which now costs $1 billion, will be decided by the courts.

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Metro’s original contractor, Spanish construction giant Acciona, filed a $250 million lawsuit in the B.C. Supreme Court on Thursday. Acciona alleges she was wrongfully terminated from the project by Metro Vancouver, which is now working with a new contractor to complete the installation

Acciona was selected in 2017 to design a $504 million secondary treatment plant for 250,000 homes on the North Shore.

As construction began, Acciona alleges in its 98-page Notice of Claim that Metro “repeatedly and wrongfully conducted itself in the design review process” set out in the contract and argues that most delays and cost increases were caused by issues with Metro Vancouver’s Own Design.

In 2019, Metro and Acciona agreed to a 2½-year extension and a budget increase to $621 million. But, Acciona alleged, by mid-2021 it was clear the project could not be built on Metro’s selected site without significant changes, including its deadline.

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Metro Chief Administrative Officer Jerry Dobrovolny said Thursday that the Regional District “is satisfied that its decision to terminate was justified.”

“Metro Vancouver will defend itself against Acciona’s claims, including unsubstantiated allegations of misconduct,” Dobrovolny said in a statement.

Acciona’s allegations have not been proven in court and Metro Vancouver has not filed a response.

In the statement, Dobrovolny said, Metro Vancouver accepted Acciona’s revisions to the contract, allowing more time to build the processing plant, as well as an increased budget and an extension of the deadline.

“Metro Vancouver continued to act reasonably and to adhere to the terms of the contract, including making all due payments in a timely manner,” Dobrovolny said.

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However, it was Acciona that missed key construction milestones, he alleged, and it “became evident in 2021 that Acciona was unable to meet its obligations under its contract with Metro Vancouver”.

Metro terminated the contract in January.

In February, Metro hired PCL Constructors West Coast Inc. on a $40 million contract to develop a construction restart plan that has consumed $498 million so far.

In its application, Acciona alleges that the project was beset by problems that began with Metro’s selection of the former BC Rail passenger station lands, which were too small to accommodate the planned facilities and subject to natural hazards. , including seismic risk and sea level rise.

And during the construction process, Acciona discovered “endemic errors and conflicts in (Metro Vancouver’s) design and construction specifications,” the claim alleges.

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“The delay in the target acceptance date and increased costs to complete the project were caused by the project site being unsuitable,” the lawsuit alleges, and Metro’s “misconduct” Vancouver by not approving changes to design, schedule and budget. as required.

The company says it was engaged in “good faith” discussions to resolve issues with the project last summer and fall when Metro said Acciona appeared to have abandoned the project.

“In fact, at all relevant times, Acciona’s updated project schedule, as required … provided an accurate and realistic representation of Acciona’s plan to fulfill its obligations,” the claim alleges, adding that the termination of the agreement was abusive.

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Acciona is asking for at least $250 million, including a $100 million payment for work already done that Metro withheld last fall and $50 million from design-build security from Acciona and others damages such as diminished reputation as a result of wrongful dismissal and loss of opportunity.

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