Question

Explain how case law Right of Ontario v Ron Engineering & Construction (Eastern) Ltd. [1981] S.C.R. 111 played a pivotal role in establishing new contract concepts in Canada?

-  details and key facts of the claim

- contribution of the court’s decision to establish new bidding rules and laws

Answer 1

The case related to Right of Ontario v Ron Engineering & Construction (Eastern) Ltd. of 1981 was considered to be the most important Supreme Court of Canada decision on the regulation of tendering for contracts. The case was related to the matter of whether the acceptance of a call for tenders for a construction work could represent a binding contract.

The Court held that in fact in many cases the submission of a proposal in reaction to a call for tenders represents a contract separate from the concluding contract for the construction. Thus with the release of the decision the tendering procedure experienced in Canada the way it functioned in earlier periods was basically further modified and transformed accordingly.

Supreme Court apprehended that the tender procedure in the case comprised of two contracts an independent contract occurring automatically upon the submission of a tender and the contract honored upon the tender's acceptance. Thus the court rulings had a considerable impact on the regulation concerned with erroneous and incorrect bids.

Thus the preceding regulation having been ruled against the erroneous bidder was basically averted from any kind of reprieve and assistance. The mistaken bidder’s bid deposit or bond was enforceable and the erroneous bidder could be enforced to go through the process of honoring the contract obligation and upon denial to do so face the consequences of a considerable and significant damages allegation and assertion.

Thus whether or not a bid contract takes place upon the submission of a biddable tender to a great extent depends on independent examination if it can be appropriately determined that the concerned parties have indeed independently proposed to enter into the contractual obligations upon its submission of the tender.