Metrolinx has decided not to appeal a judge’s ruling that blocked the agency from terminating its troubled $770-million vehicle contract with Bombardier.

The provincial transit agency filed a notice in May that reserved its right to appeal the decision, which Judge Glenn Hainey of the Superior Court of Justice delivered the month before.

Friday was the deadline to move ahead with the case, and a spokesperson for the agency confirmed that Metrolinx has decided not to proceed.

Instead, the agency is continuing to pursue a dispute resolution process with the Quebec-based rail manufacturer.

“Metrolinx is concentrating on the dispute resolution with Bombardier . . . . We have decided to not continue with the appeal process,” wrote Anne Marie Aikins.

She declined to provide an update on the dispute process, and it’s not clear when it will conclude.

In an interview, a spokesperson for Bombardier said it was a “wise decision” for Metrolinx to abandon the appeal.

“Our focus has always been to resolve the issues we may have . . . so we can come to a win-win outcome for all parties involved,” said Eric Prud-Homme.

Metrolinx signed the deal for 182 light rail vehicles (LRVs) in 2010, with the intention of running the cars on the $5.3-billion Eglinton Crosstown and other Toronto-area LRT lines.

Last October, Metrolinx attempted to terminate the contract, claiming Bombardier was in default. The first two prototype vehicles were supposed to be delivered in 2015, but Metrolinx still hasn’t received them, and the agency said Bombardier’s production woes risked delaying the opening of the Crosstown.

The legal case was sparked in February when Bombardier filed an application for an injunction against the termination. The company argued that Metrolinx couldn’t unilaterally cancel the deal, and that, whether the company was in default should be decided through the dispute-resolution process written into the contract.

The judge agreed.

Bombardier maintains that it has not defaulted on the order.

In May, the provincial transportation minister announced that Metrolinx had agreed to buy 61 LRVs from French-based company Alstom as a backup for the Bombardier order.

If the dispute-resolution process determines that Bombardier is in default, Metrolinx will deploy 44 of the Alstom vehicles on the Crosstown. The other 17 are slated for the Finch West LRT.

Both lines are scheduled for completion in 2021.

The Alstom deal cost $528 million, and was issued on a sole-source basis, which the minister said was necessary because of the tight timelines for opening the Crosstown.

Siemens, a German-based rail manufacturer, has complained that the province violated its own procurement policies by not opening up the contract to a competitive bid.

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In a separate development that signals bad news for Bombardier, Metrolinx announced, on Friday, it was issuing a request for qualifications for a private entity to review the agency’s current commuter rail operations and eventually take them over. The decision comes as Metrolinx is drastically expanding its GO Transit service under its regional express rail program.

Bombardier is under contract to operate and maintain GO Transit until 2023, under a deal worth $927 million to the company.

A Metrolinx spokesperson said Bombardier would not be allowed to independently bid on the new contract because it would be a conflict to review its own work.

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