1 million in legal fees to recover 4.5 million overpaid by Montreal

Photo: Marie-France Coallier Le Devoir The City’s Legal Affairs Department notes that this case is becoming much more complex than anticipated. The company is challenging the constitutionality of “Bill 26,” which came into effect in December 2017.

Marco Fortier

Published at 16:03

• Montreal

The City of Montreal’s legal efforts to recover $4.5 million from an engineering consulting firm accused of collusion are more complex than expected: the city’s legal fees are now estimated at $1 million. And the bill could still increase for Montreal taxpayers.

A document prepared by the city mentions a $235,000 increase in fees to be paid to the IMK law firm in this case, which would bring the bill to $1.028 million. However, the legal action against Consultants Aecom Inc., formerly Tecsult, is far from over, according to the decision summary. Elected officials will be asked to rule on the matter at the agglomeration council on Thursday.

The City began these steps in June 2018 in the hope of “recovering the overpayment between 2004 and 2009 due to bid rigging to circumvent the rules for awarding and managing public contracts,” states the document prepared for elected officials.

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“Due to the importance of the issue, the complexity of proving fraud and influence peddling, and the associated workload, it was necessary to call on external lawyers to prepare and conduct the City’s legal action against this consulting engineering firm,” states the summary.

The City’s Legal Affairs Department notes that this case is becoming much more complex than anticipated. The company is challenging the constitutionality of the Act mainly aimed at recovering amounts paid unjustly as a result of fraud or fraudulent tactics in the context of public contracts — commonly known as “Bill 26” — which came into force in December 2017.

The hearing of the case in Superior Court was delayed by almost a year, from November 2022 to October 2023, due to a lack of judges, which “added to the preparation work.” The court ruled in favor of the city in February 2024. Aecom was granted permission to appeal four months later, last June.

The firm is also requesting the disclosure of thousands of pages of documents from the municipalities of Brossard, Trois-Rivières and Saguenay — requirements “that were not anticipated when the previous fee increases were calculated,” the city’s lawyers emphasize.

The aftermath of the Charbonneau Commission

Municipal representatives argue that the IMK firm offers “highly experienced litigation lawyers, who also have a very good knowledge of municipal law and Act 26, and whose hourly rates are in accordance with the Fee Schedule adopted in 2023 by the Executive Committee. Given the importance of the case, the City’s lawyers also closely monitor the work of the external lawyers, with whom they declare themselves entirely satisfied.”

Another consulting firm — GBI Experts-conseils inc. — was also the subject of a lawsuit by the City to recover overpayments related to irregularities. An out-of-court settlement of $45,000, reached in February 2021, put an end to the City’s efforts. The agreement was accompanied by a “deed of withdrawal” with respect to the defendants Frank Zampino, former chair of the City’s Executive Committee, Bernard Trépanier (now deceased), former head of financing for the Union Montréal party, and Robert Marcil, former director of public works for Montreal.

A voluntary disclosure program, created in the wake of the Charbonneau Commission on contract management in the construction industry, also allowed the City to recover $31 million from companies.