Construction firm Caspian faces new police HQ lawsuit

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This article was published 14/04/2021 (1308 days ago), so information in it may no longer be current.

A Winnipeg construction company at the centre of an ongoing legal fight with the city over construction of the downtown Winnipeg Police Service headquarters building is facing a new lawsuit from a subcontractor.

Tiger Ventures was hired by Caspian Projects Inc. to provide demolition services for the headquarters project.

In a statement of claim filed last week, Tiger Ventures alleges Caspian and its owner, Armik Babakhanians, told Tiger Ventures in 2011 it had a maximum budget of $2.5 million for the work, but learned in 2016 Caspian had provided the city with inflated invoices for three times that amount.

The statement of claim accuses Caspian of fraudulent misrepresentation, breach of contract and unjust enrichment.

“The plaintiff relied upon the representation by the defendants in accepting the agreement,” says the lawsuit. “The plaintiff understood that it would lose money, but it relied on the representation of the defendants and entered into the agreement in anticipation of future good will from the defendants and the City of Winnipeg.”

The allegations remain unproven in court.

In a separate lawsuit filed last year, the City of Winnipeg alleges Caspian, in concert with other defendants, including former city chief administrative officer Phil Sheegl, conspired and “schemed” to inflate the cost of the construction project.

The city budgeted $135 million to convert the former Canada Post office and mail-sorting plant into its new downtown WPS headquarters. By the time the project was completed, the cost had soared to $214 million.