March 27, 1930

CON

Edmond Baird Ryckman

Conservative (1867-1942)

Mr. RYCKMAN:

I was paired with the hon. member for St. Hyacinthe-Rouville (Mr. Morin). Had I voted, I would have voted for the subamendment.

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CON

Robert James Manion

Conservative (1867-1942)

Mr. MANION:

I was paired with the hon. Minister of National Revenue (Mr. Euler). Had I voted, I would have voted for the subamendment.

1032 , COMMONS

Supply-Harbours and Rivers-Quebec

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CON

Thomas Langton Church

Conservative (1867-1942)

Mr. CHURCH:

I was paired with the hon. member for Jacques-Cartier (Mr. Rheaume) Had I voted, I would have voted for the subamendment.

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CON

Felix Patrick Quinn

Conservative (1867-1942)

Mr. QUINN:

I was paired with the hon. member for Willow Bunch (Mr. Donnelly). Had I voted, I would have voted for the subamendment and against the amendment.

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LIB

Edmund William Tobin

Liberal

Mr. TOBIN:

I was paired with the hon.

member for Toronto-Scarborough (Mr. Harris). Had I voted, I would have voted against both the subamendment and the amendment.

Motion agreed to and the house went into committee of supply, Mr. Johnston in the chair.

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DEPARTMENT OF PUBLIC WORKS


Quebec-harbours and rivers-Cap de la Madeleine-in full and final settlement of the claim of Messrs. Munn & Shea in connection with their contract for wharf extension, $27,249.25.


CON

George Halsey Perley

Conservative (1867-1942)

Sir GEORGE PERLEY:

When we were

discussing this item the other evening the minister was asked to make an explanation. It had been suggested that the department had given contracts to people who did not intend to carry them out at the price named in the contract, as they expected to receive payment for extras. Some hon. members were of the opinion that this item proved conclusively that the contract had been taken at a lower figure than it should have been and that this item was to cover payment for extras.

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LIB

John Campbell Elliott (Minister of Public Works)

Liberal

Hon. J. C. ELLIOTT (Minister of Public Works):

It is possibly true that the

contract was taken at a lower figure than it should have been, but that is not the basis upon which this allowance is being made. The circumstances in connection with this item are unusual. The contract was taken at a price much below the next lowest tenderer, but that of itself would not entitle the contractor to remuneration. This claim is based on three different grounds. First of all, the estimate for ballast was made at $2 per cubic yard. At the time the tender was made there seemed to be no doubt that the contractor would be able to obtain his ballast at $2 per cubic yard, but between the time of putting in the tender and the awarding of the contract the Wayagamack Pulp and Paper Company had commenced the construction of a large wharf at Three Rivers and had contracted for the whole available supply of stone at that point. Another quarry had1 to be opened up and the stone cost the contractor $1 per cubic yard extra, which made an increase of about

$32,000. They claim also that they were delayed in getting the berth dredged for their crib seats, as previous orders for the dredge had been boobed and they had to wait their turn, losing about two months.

As my hon. friend will remember, the fall of 1927, when this work was being carried out, was exceptionally wet. Having failed to get their stone at the former quarry, the quarry which they opened for the supply of ballast stone, near Grondines, thirty miles below the site of the work, was so flooded that they were not able to work it. They were not able to discontinue operations as it would have left the wharf in an unsafe condition, so they had to buy stone at greatly enhanced prices, filling the crib during the winter under adverse conditions, and this made the work expensive. This high water continued until late in 1928. The district engineer states that the contractors' claim in this respect is substantiated by the fact that in 1927 and 1928 the St. Lawrence river level rose and kept at practically spring flood heights during those years. There was considerable damage all over the province and many bridges, railway wharves and roads were washed away. The engineer states further that in the spring of 1928, following the very wet autumn of 1927' the water level was still so high that the wharf and approach to the wharf were flooded to such an extent that they could not get to the wharf with the stone. This meant that the stone in railway cars was subject to demurrage and when unloaded had to be rehandled as it could not be taken to the wharf. The district engineer states that the contractors executed the work as best they could under the adverse conditions, and did all that it was humanly possible to do to proceed with the work in the most economical way.

The report shows that the stone filling between the cribs, on the stated figures given by the company, gives a price of $3.35 per cubic yard instead of their tender price of $2, and the engineer considered that the adverse conditions amounted to practically force majeure and recommended the claim for favourable consideration. What was done was this: an estimate was taken j the books were submitted for examination by the officials of the department, and it was found that this work cost the contractors $54,498.50 more than the amount they received. The recommendation of the local engineer was that in view of the diligence with which they had proceeded and the difficulties with which they had been confronted, and which had increased the cost of the work by this amount,

Supply-Harbours and Rivers-Quebec

one-half of this claim be paid. After a number of consultations, including interviews with the contractors during which they urged very strongly the payment of their whole claim, the practice that had been followed by the department in similar cases, of dividing under such exceptional circumstances the loss with the contractors, was adopted.

SIR GEORGE PERLEY: The latter part of the minister's explanation seems to be quite proper. The main item, I understand, was the extra cost of ballast which had been estimated at $2 and which it was found for certain reasons cost over $3. Is that a good reason for making an extra payment? Would the contractors have presented the government with some money if they had been able to get their ballast at II instead of having to pay $2 as was estimated?

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LIB

John Campbell Elliott (Minister of Public Works)

Liberal

Mr. ELLIOTT:

There is no doubt about that and I may tell my hon. friend the contractors feel they are very badly treated as it is. They have lost their time and they are out now the sum of $27,000, but it is this force majeure that is, in the opinion of the engineers, responsible for the fact that the contractors were not able to get into the new quarry which they owned.

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CON

Richard Burpee Hanson

Conservative (1867-1942)

Mr. HANSON:

I listened very attentively to everything the minister said. Does it not all come down to this, that the department is making a compassionate allowance? There is not a single instance of a legal or even equitable claim against the department, but because the contractors have fallen upon bad days and met a serious contingency they had not counted upon, the department now, as a compassionate allowance, is making a contribution of 50 per cent of the loss. This is on the same basis as the Escuminac item in New Brunswick.

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LIB

John Campbell Elliott (Minister of Public Works)

Liberal

Mr. ELLIOTT:

Quite so.

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CON

Richard Burpee Hanson

Conservative (1867-1942)

Mr. HANSON:

I should like, for the information of parliament, to know what is the annual cost to the country of proceeding cn that principle; because I know the amount is increasing. A claim for extra cost of procuring ballast would never be allowed by a private ' company if they had a contract with the contractor, or by a municipality which was guarding money collected from the taxpayers by direct taxation. I am satisfied on that point, having had a very substantial municipal experience in connection with public works. I am not at the moment adversely criticizing this policy, because I know of cases of great hardship such as occurred in the Escuminac 2419-66

case where not the contractor but the subcontractor lost $10,000 and was pretty nearly wiped out. This policy is costing the country a great deal of money and we ought to know for the last fiscal year how many such cases there have been and what it is going to cost the country to divide these losses. It cannot be urged that there was any force majeure in connection with the ballast; it was simply lack of foresight on the part of the contractor. He did not make a contract for the delivery of his ballast; someone else got in ahead of him, and he had to open up a new quarry, and that accounts for $32,000 of the total loss, according to the minister's statement. I do not think the contractor was entitled to a cent on account of the increased cost of the ballast. We might as well understand the principle on which this money is voted. This is purely a gift to the contractor. He did not look after his contract in a businesslike way. Had he secured the ballast before the other people got in ahead of him, he would have been able to do the work at the bid price. It is not a case of force majeure. Floods and high water, of course, are beyond the control of a contractor, but he ought not to be paid because of his neglect in securing the ballast.

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LIB

John Campbell Elliott (Minister of Public Works)

Liberal

Mr. ELLIOTT:

I think my hon. friend has taken a pretty reasonable view, and if I may say so, a fairly accurate view of the legal situation, except that the law with regard to

force majeure is that if the circumstances were so unusual that they could not by any reasonable diligence have been foreseen and provided against, it could not have been in the contemplation of the parties.

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CON

Richard Burpee Hanson

Conservative (1867-1942)

Mr. HANSON:

It is not quite that wide.

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LIB

John Campbell Elliott (Minister of Public Works)

Liberal

Mr. ELLIOTT:

I think my hon. friend will find that that is exactly what it is.

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CON

Richard Burpee Hanson

Conservative (1867-1942)

Mr. HANSON:

That would cover lack

of business ability.

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LIB

John Campbell Elliott (Minister of Public Works)

Liberal

Mr. ELLIOTT:

I want to be fair to my hon. friend because I think that he has been absolutely fair in his criticism of the Escuminac case as well as the one now under consideration. Might I point out that it was not lack of diligence on the pant of the contractor that prevented his getting the stone before the Wayagamack company got in? They got in between the time he submitted his tender and the time he was awarded the contract.

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CON

Richard Burpee Hanson

Conservative (1867-1942)

Mr. HANSON:

He should have had an option on the stone.

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LIB

John Campbell Elliott (Minister of Public Works)

Liberal

Mr. ELLIOTT:

I think my hon. friend would hardly say that a contractor who did not know whether he was going to get the

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Supply-Harbours and Rivers, Quebec.

contract was justified in going to the expense of obtaining an option. There have been very few of these cases during my regime as Minister of Public Works. I should be very glad to get my hon. friend a complete list of such cases for some years past, and I think he will find that the department has adopted an absolutely uniform method in regard to all.

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March 27, 1930