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Yellowknife

Subcontractor files $3.37M lien against Stanton legacy project

Last modified: June 23, 2022 at 9:35am


A subcontractor working to transform Yellowknife’s former hospital into a care facility has filed a lien against the project, claiming it is plagued with issues. The main contractor is challenging the lien.

Alberta-based contractor SMI Construction was hired in January 2021 by CANA Construction – the primary contractor for the project – to complete interior drywalling and ceilings as part of renovations to the “Legacy Stanton” building.

Once retrofits are finished, the NWT government plans to use the site to offer long-term and extended care beds and some outpatient services.

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SMI alleges it was wrongly removed from the project and has not been paid for several months of work. SMI claims ongoing problems at the worksite include mistreatment of its staff, design errors and improper work.

Earlier this month, the company filed a lien against CANA Management Ltd, the territorial government, Stanton Ventura Inc, and the Manufacturers Life Insurance Company, claiming more than $3.37 million in damages from all defendants and an additional $2 million in punitive damages solely from CANA.

In court documents, SMI claims that despite repeated requests, it has yet to be paid $3,377,394.66 for work its staff completed between January and April this year. CANA removed SMI from the Legacy Stanton project after April 4, claiming SMI was in breach of its subcontract agreement, which SMI disputes. 

Stanton Territorial Hospital, right, and the former hospital building are seen in May 2020
Stanton Territorial Hospital, right, and the former hospital building – now known as Legacy Stanton – are seen in May 2020. Ollie Williams/Cabin Radio

SMI further claims that CANA, Stanton Ventura and the NWT government were negligent through failure to provide SMI with accurate information to ensure that its work remained on time and budget, required materials were accurate, and that CANA completed its work in a “reasonably skillful manner” to prevent loss and damage to other contractors on the project.

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SMI also claims the defendants did not follow dispute resolution provisions in the main contract to address issues like allegations of workplace harassment. 

CANA has applied to have the lien declared invalid, claiming it was not properly registered by SMI. In court documents, CANA alleges an affidavit filed by SMI is “inconsistent, inaccurate and contains false statements.”

CANA did not respond to Cabin Radio’s requests for comment regarding SMI’s allegations. 

Allegations of health and safety hazards

In setting out to Cabin Radio allegations of construction issues at the Legacy Stanton project, SMI management alleged there had been delays, damaged door frames, and drawings of the building had inaccurate dimensions. SMI claimed some issues could pose safety hazards, like improper backing that made grab-bar rails installed for accessible toilets incapable of holding weight.

SMI management claimed staff were instructed to frame corners using three studs, something SMI said is normally done with wood frames but is unusual for steel frames. 

“That’s not something that’s done, ever, in a steel stud framing job,” one SMI staff member told Cabin Radio.

In a December 2021 letter obtained by Cabin Radio, SMI wrote that it could not offer warranty for the three-corner studs, walls where studs had been snipped, nor washroom doors that were damaged, had defects or were missing spreader bars. The letter alleges backing throughout the project had been installed incorrectly, posing an “extreme health hazard.” 

‘I’ve never seen bullying at this level’

Some SMI staff claimed they were bullied by CANA supervisors, including being called names, belittled, and threatened with being fired. 

“I’ve never seen bullying at this level before,” an SMI manager said. 

“It’s not like there were one or two isolated incidents. It never stopped.”

In one alleged incident, SMI staff claimed a CANA supervisor threw a reciprocating saw at an SMI supervisor on-site following a disagreement by text message. 

Two SMI staff who claim to have witnessed the incident separately told Cabin Radio the man stormed into SMI’s office and threw the saw at the SMI supervisor while he was on the phone. While SMI staff said they were uninjured in the alleged incident, they said the CANA supervisor cut his hand on the saw and required stitches. 

Both employees claimed the man was not reprimanded for the incident but SMI staff were told to be more respectful of the CANA supervisor. The claims have not been tested in court.

GNWT declines to get involved

SMI management claim they repeatedly voiced concerns to the NWT government and requested mediation help as SMI’s relationship with CANA deteriorated, but the territory declined to step in. 

James Ross, a spokesperson for the Department of Infrastructure, confirmed to Cabin Radio in April that the NWT government was aware of the dispute between CANA and SMI, including SMI’s allegations regarding the health and safety of its employees. 

Ross said main contractor CANA, rather than the NWT government, held responsibility for ensuring the health and safety of those at the worksite, correcting deficiencies, and mitigating the impact of any issues. He added the NWT government does not have a contract with SMI and is not privy to the details of the subcontract between CANA and SMI. 

“The department continues to encourage CANA and SMI to work together constructively to resolve these issues,” he wrote.

According to Ross, work at the former hospital is routinely inspected. He said the project is within budget and expected to be “substantially complete” by the fall of 2022.

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