The Queen (Ont.) v. Ron Engineering

The Queen (Ont.) v. Ron Engineering

Submission of the tender created an immediate unilateral contract (Contract A) making the bid irrevocable for the stipulated period; because the tender as submitted was capable of acceptance at that time the deposit was contractually subject to forfeiture under the tender terms despite a subsequent discovery of a calculation error; accordingly the owner was entitled to retain the $150,000 deposit and the appeal is allowed.

Citation
[1981] 1 SCR 111
Parties
Appellant/defendant: Her Majesty The Queen in right of Ontario and the Water Resources Commission; Respondent/plaintiff: Ron Engineering & Construction (Eastern) Ltd.
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
27 January 1981
Procedural Posture
Contract Appeal / Supreme Court of Canada on Appeal From the Court of Appeal for Ontario
Outcome
Appeal allowed; order of the Court of Appeal set aside; judgment of trial judge restored
Legal Topics
Mistake, Tender Deposit Forfeiture, Unilateral Contract (contract A), Acceptance and Revocability, Bid Bonds and Performance Bonds
Source Language
English
Contract Procurement/tender Law Mistake Tender Deposit Forfeiture Unilateral Contract (contract A) Acceptance and Revocability Bid Bonds and Performance Bonds

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Parties

Her Majesty The Queen in right of Ontario and the Water Resources Commission

Appellant/defendant

Ron Engineering & Construction (Eastern) Ltd.

Respondent/plaintiff

Procedural Posture

Contract Appeal / Supreme Court of Canada on Appeal From the Court of Appeal for Ontario

Legal Issues

  1. 1 Whether a tender containing a post‑submission calculation mistake can be forfeited under the tender terms
  2. 2 Whether submission of a tender creates an immediate unilateral contract (Contract A) making the bid irrevocable for the stipulated period
  3. 3 Whether notice of the mistake given to the owner prior to acceptance prevents acceptance and forfeiture of the deposit

Ratio Decidendi

Submission of the tender created an immediate unilateral contract (Contract A) making the bid irrevocable for the stipulated period; because the tender as submitted was capable of acceptance at that time the deposit was contractually subject to forfeiture under the tender terms despite a subsequent discovery of a calculation error; accordingly the owner was entitled to retain the $150,000 deposit and the appeal is allowed.

Court Disposition

Appeal allowed; order of the Court of Appeal set aside; judgment of trial judge restored

Orders

  • Appeal allowed
  • Order of the Court of Appeal for Ontario set aside