BY Jon Willing, Ottawa Sun
The city and its Lansdowne Park partner could face each other in the legal arena this year over $17 million in steel repairs at the old Civic Centre.
The Ottawa Sports and Entertainment Group has paid for the renovations at the TD Place arena, even though the company has questioned if should be on the hook for the extra costs.
The deal to redevelop Lansdowne includes a dispute resolution provision requiring the two sides to talk it out before signing up for arbitration.
The city and OSEG have been talking about it for more than a year.
According to the city, both sides are getting their legal guns ready before deciding if an arbitrator should decide who pays the massive bill.
"Each party has retained legal counsel and they are preparing the case for their respective client," city solicitor and clerk Rick O'Connor said Wednesday in an e-mail to the Sun.
O'Connor said if the negotiations can't resolve the disagreement, the dispute would head to arbitration later this year or in early 2016.
OSEG has said it didn't know how bad the situation was in the arena before an inspection in 2013 revealed heavily corroded structural steel.
There was $17 million of additional work needed that came as a surprise to OSEG.
Floors and walls had to be removed to access the structural steel. Most of the work happened in the roof, including new steel decking and joists under the upper concourse.
Because opening the stadium and arena on time was critical, OSEG agreed to foot the bill for the steelwork and tackle negotiations with the city later.
The arena opened last October.
The city has argued it signed a contract with a guaranteed maximum price for the renovations and OSEG is responsible for any costs over and above that amount.
OSEG has questioned if the repairs fall within the scope of work to which the company agreed.
Like any negotiations at risk of going to arbitration, hammering out an agreement is often much better than having no control over the outcome.
In this case, the Lansdowne contract says a decision by an arbitrator would be final and binding with no option to appeal by either side.