Controversial contract in tow for Winnipeg towing company

A new city contract is under the microscope after a towing company was granted an agreement with the Winnipeg Police Service late last week.

On Aug. 2, Tartan Towing was awarded a contract to tow and store cars until June 30, 2025, with options for four mutually agreed upon one-year extensions.

But the contract comes with a hitch – the company is currently fighting a legal battle against the City of Winnipeg.

“The matter between the City of Winnipeg and Tartan Towing is still … in front of the courts,” said Markus Chambers, city councillor for the St. Norbert – Seine River ward.

That matter began in June 2023 – when the city filed a statement of claim against Tartan Towing. It said the company overbilled $1.1 million for tows that didn’t happen.

In November, Tartan launched a countersuit saying it was prohibited from completing tows if they were interrupted by the driver of the vehicle. The company also said it was acting honestly and in good faith.

“Innocent until proven guilty,” said Coun. Janice Lukes, who oversees the Waverley West ward.

“This is a very unusual situation,” said Neil McArthur, the director of the Centre for Applied Ethics at the University of Manitoba. “This is very rare in city politics.”

While it may be rare, McArthur said the two separate matters do not make it a conflict of interest.

“The city is legally obliged to give contracts to the most competitive bidder and so Tartan comes in, it has not been debarred.”

According to the city, a company can only be debarred if there’s a conviction of a person or their company’s director for trying to obtain a contract dishonestly or if there’s a serious contract breach.

“If you haven’t been debarred and you are eligible for bidding, then if you come up with the lowest bid, any ongoing litigation or other issues actually can’t affect the price,” McArthur said.

In a statement to CTV News, Mayor Scott Gillingham called the new, $18,480 contract “relatively small,” saying it had a limited number of bidders and didn’t require council approval.

“I expect all vendors to meet their contract conditions and I expect the public service to closely monitor performance and take appropriate action if there are concerns,” he said.

But some city councillors have their own ideas of “appropriate action.”

“In the instance where there is a matter before the courts, maybe a suspension or a waiver is necessary to allow fair practices to go forward,” Chambers suggested.

“If they’re found guilty, what I would like to see is this contract reposted again next year,” Lukes emphasized.

CTV News reached out to Tartan Towing for more information about the lawsuits, but an individual who identified themselves as the owner said the company had no comment.

A city spokesperson said court dates for the lawsuits have not been set yet, and the city will not be commenting on the legal matters as they remain before the courts.

-          With files from CTV’s Charles Lefebvre and Danton Unger