One of the first statements of defence against a lawsuit launched earlier this year by the Ottawa Hospital about construction procurement irregularities suggests that hospital staff and other businesses, not the contractor, are responsible for any wrongdoing.
DRS Construction and owner Gerry Dubé assert some of new allegations against hospital employees and other vendors, including individuals and companies not named in the hospital lawsuit.
DRS and Dube allege, according to a report by CBC, that:
- senior hospital employees often asked DRS to provide hockey tickets for special events;
- other vendors not named in the original lawsuit paid for trips for hospital employees; and
- DRS supervised work at the homes of high-ranking executives of the hospital at fair market value.
The hospital claims in a lawsuit against several contractors and two former employees that companies gave the former employees kickbacks, including lavish trips, deals on cars and renovations.
In return, the suit alleged the contractors received “improper procurement advantages,” including influence over tenders as well as allegedly getting paid for “improper and inflated invoices” for no work or work that was not completed.
The defence statement filed on March 29 rejects any responsibility for allegations of bad faith, conspiracy, fraud, extortion, inflated prices, price fixing, or contract fixing, breaking contracts, enrichment without cause, damages or losses alleged by the Ottawa Hospital.
DRS and Dubé say other businesses — not their organization — paid for flights and/or trips for Ottawa Hospital employees, according to the statement. Instead, these travel costs were covered by co-defendants Larry St-Pierre and Guy Adrian Lapierre; as well as Michael Nolan, president of and (former hospital employee) Tim Richards.
CBC reports the statement goes on to claim “other hospital vendors” have also been involved in paid trips, but said the hospital refuses to divulge who they are.
The statement says DRS Construction had been hired to supervise work at the residence of co-accused hospital employee, Frank Medwenitsch but also worked at the homes of several other hospital employees, including COO Cameron Love, vice-president finance Richard Wilson, and director of projects Michele Emond. However, DRS asserts it received fair market price for its work.
The hospital statement of claim alleged DRS removed a tree from the home of Medwentisch.
“But the defence by DRS Construction and Dubé states the text used as proof that a contractor was coming to Medwentisch’s home was actually from a phone that belonged Michael Nolan of Bradford Construction,” CBC reported, citing a translation of the statement of defence, written in French.
“For reasons unknown to DRS Construction and Dubé, The Ottawa Hospital chose not to add Michael Nolan and/or Bradford Construction as one of the defendants in this suit.”
The defence includes another incident from the original hospital claim, where a text used as evidence alleged to have come from DRS, was actually, according to the defence, coming from a the number belonging to Bradford Construction.
DRS also denied giving any gifts in order to obtain advantages.
The claims and counterclaims have not been proven in court.
DRS already has an action outstanding claiming $1.5 million in outstanding invoices. The hospital has asked that claim to be consolidated with its own lawsuit, but DRS rejects the idea that the two suits are related.
The Ottawa Hospital said it anticipates more statements of defence to be filed in coming weeks but won’t comment while the issue is before the court.
“We are following due process and throughout this process we will continue to act in the best interests of the hospital and the community we serve,” a hospital spokesperson said in a statement.
“In the meantime we continue to reinforce our zero tolerance for fraud, or any behaviour that breaches hospital policies and values. We are also regularly assessing and implementing enhancements to our policies, processes and controls to protect the hospital from the risk of fraud.”