TTC to sue Bombardier over delayed streetcar delivery

Oct 30, 2015 | News

Amy Wallace

The TTC board has voted to sue Bombardier for its failure to deliver new streetcars on schedule.

The unanimous decision to pursue legal action against the Montreal-based company was made at a Wednesday afternoon board meeting.

The transit agency is asking for $50 million as a late delivery fee.

The TTC also plans on seeking damages for maintenance and overhaul costs of the existing cars, as well as additional TTC staff time costs.

In 2009, the TTC paid more than $1 billion for 204 new streetcars.

The contract calls for the fleet to be fully delivered by the end of 2019.

The new cars are only running on the 509 Harbourfront and 510 Spadina lines.

This is the latest in a series of delays with the new streetcars.

In May, the city had to reject several new vehicles due to manufacturing defects.

Is the lawsuit a wise move?

“I question why they’re doing it publicly,” Thomas Arndt, a partner at Dickinson Wright LLP  – a Toronto law firm that specializes in commercial litigation and class actions, said.

“What are their motives to publicly disclose that it’s considering filing the 50 million claim? Privately, between TTC and Bombardier is one thing, but to actually go to the media and publicly disclose this is another.”

Arndt said the “extra pressure may cause significant harm.”

“The risk of course, is if TTC puts too much pressure on Bombardier, does the quality of the product go down?” Arndt said.

Eric Kay, a litigation partner at Dickinson Wright LLP, said the TTC’s move might be a way to get quicker action.

“I think it’s a necessary decision, given the fact that Bombardier contractually agreed to delivery dates and has apparently repeatedly failed to deliver on those dates,” Kay said.

“I’m sure the purpose of the lawsuit is really to force Bombardier to perform, or to suffer the financial consequences of not performing,”