Michael Lewis
Special to GTA Construction News
Toronto city council has voted to reinstate Pave-1 Construction Ltd. and IPAC Paving Ltd. as eligible suppliers of goods and services and ordered a review of its contractor suspension policies after the companies served prohibitions well beyond the city’s current suspension time limits.
In a report to council considered at its meeting on July 24, chief procurement officer Geneviève Sharkey said the suspensions that began in 2012 extended past the 5-year maximum term adopted by the city in 2018 as part of a revamp of contractor suspension rules.
The federal government, by way of comparison, suspends suppliers over misconduct for a maximum of ten years. The paving company suspensions against the two entities who together employ seventy people are the only permanent contractor bans Toronto has ever issued.
“Due to the unique circumstances under which IPAC and Pave-1 were dealt with, the path forward must consider a hybrid approach to reviewing the actions taken previously by council,” Sharkey said.
IPAC was suspended 11 years ago and Pave-1 9 years ago. Under the city’s amended rules, suspensions are eligible for review after 2.5 years.
Sharkey said no formal mechanism exists for reviewing permanent suspensions, a penalty not imposed under current rules since there is no definitive end date. “However, given that the current maximum suspension term for a Supplier Code of Conduct violation is 5 years, and there is a minimum 5-year ineligibility period based on the illegality provision, it is reasonable to undertake the review process for suspensions issued well in excess of both terms.”
Suspensions were imposed on IPAC owner Sebastian Corbo and related entities after he pled guilty to paying a secret commission related to TTC contracts to a subsequently fired Toronto Transit Commission project manager.
According to a Toronto Police Services release in 2011, Corbo billed the TTC $198,619.92 for work valued at $54,087.75. It further alleged that between June 2009 and July 2010 the project manager, his wife and son created bank accounts and received funds directly from IPAC Paving.
In June 2011, Sebastian Corbo, the TTC employee and the TTC employee’s wife and son were arrested and charged with Criminal Code offences including fraud over $5,000, conspiracy to commit an indictable offence and paying and receiving a secret commission. Corbo was handed a four-month conditional sentence, one year of probation, and ordered to pay $30,000 in restitution to the TTC.
Council at its meeting in February 2012 suspended Sebastian Corbo and any entity he controlled “until the courts had rendered a final decision … all appeals had been exhausted or until all of the charges had been withdrawn.”
In 2014, Toronto extended the permanent suspension to Pave-1, citing its affiliation with IPAC, although Pave-1 owner John Corbo, the son of Sebastian Corbo, was not suspended. Pave-1 was set up a month after the suspension of IPAC.
IPAC itself was never charged, but took responsibility by fully repaying the TTC, John Corbo said in a deposition to the city. He said more than sufficient time has passed and noted that there are no allegations linking him to any illegal activity. He also said lifting the suspensions would not pose any risk to the city.
“My father retired from the business in 2012 and received a pardon in 2020. No one currently employed at IPAC or Pave-I is still employed from that time,” John Corbo said.
“I took over IPAC during a period of significant crisis. I took immediate steps to reform the business. My team and I have worked tirelessly to rebuild trust and deliver results.” He said Toronto’s lengthy suspension has harmed the North York-based, privately held construction contractor.
“It prevents us from bidding on city work and is often cited by other municipalities as a reason to disqualify us. That stigma unfairly continues to follow me, even though I had no involvement in the events that led to the suspension.”
Corbo said city staff have completed a “detailed review of our operations and concluded that we meet all current procurement standards and recommend our reinstatement. Fairness requires acknowledging the transformation we have achieved and giving us a fair opportunity to participate once again.”
Council voted 19 to 3 to reinstate IPAC and Pave-1 effective immediately.
The city has been suspending contractors more frequently for violations of its Supplier Code of Conduct, particularly due to unsatisfactory performance under a procedure in effect since January 1, 2017, Sharkey told council at its meeting.
The city’s website lists three other suspended or disqualified contractors besides entities linked to Sebastian Corbo — and Pave-1, which is noted as an affiliate.
Sharkey said council-approved suspensions range from one year to five years unless violators have received a pardon.
