City of Ottawa settling lawsuit with LRT builder

An Ottawa LRT car departs uOttawa station on Sunday, Jan. 23. (Josh Pringle/CTV News Ottawa)

The city of Ottawa is hoping to turn the page with Rideau Transit Group following years of acrimony over the construction and launch of the $2 billion light-rail transit project.

CTV News Ottawa has learned there is an agreement between the city and RTG to settle the long-standing dispute between the two parties during the construction and rollout of the project.

The city of Ottawa launched a $131-million lawsuit against RTG in May 2021 over the numerous delays and deficiencies along the Confederation Line, while RTG countersued for $225 million.

Council voted Wednesday evening to direct Transit Services General Manager Renee Amilcar to "negotiate, finalize and execute a binding settlement agreement" with Rideau Transit Group, the consortium of companies that built the Confederation Line. The vote came after councillors engaged in a five hour, in-camera session to discuss the notice of default proceedings and other disputes with RTG.

The motion states the binding settlement agreement with RTG will not be reported out to the public.

Mayor Mark Sutcliffe wouldn't comment on the specifics of the settlement between the city and RTG.

"Council approved a settlement agreement based on the terms that were disclosed in-camera," Sutcliffe told reporters.

"We can't say anything more about the confidential terms until the agreement is finalized."

The mayor wouldn't say whether any taxpayers money will be used as part of the settlement.

"I think the feeling of council is that it is in the best interest of taxpayers and residents of Ottawa and OC Transpo passengers that this is the best path forward for the community," Sutcliffe said.

Sources tell CTV News Ottawa that as part of the settlement, RTG/RTM will fill positions and hire more people to help fix issues. The city will also not pursue that RTG was in default of its contract with the city over the Confederation Line.

In March 2020, council issued a Notice of Default to Rideau Transit Group in accordance with the Project Agreement, and asked for a "remedial plan and schedule for remediation of the defaults," the motion notes.

Council voted in October 2021 to deliver a Notice of Dispute under the Project Agreement to RTG over the defaults, and asked the court to confirm the validity of the RTG defaults. The notice of default was issued after two derailments on the Confederation Line in six weeks in the summer of 2021.

Word of the settlement comes nearly two months after the public inquiry into Ottawa's light rail transit project released its final report. Commissioner Justice William Hourigan noted the relationship between the city and RTG was "adversarial" at critical stages of construction and maintenance, and "this fact contributed to problems with the OLRT1 project."