The Nova Scotia government and a company that provides care for vulnerable children and adults are locked in a pair of duelling lawsuits, with millions of public dollars potentially on the line.
The province alleges Specialized Support Services of Nova Scotia (SSSNS) overbilled for its services and refused to co-operate with an audit by Deloitte LLP.
SSSNS filed a defence and counterclaim saying there was “a complete lack of foundation” to the province’s estimate of the overbilled amount. That total is $18.2 million, according to the counterclaim.
The company alleges the province improperly withheld payments and caused the shutdown of its business.
None of the claims have been tested in court, and the province has not yet filed a response to the allegations in the counterclaim.
The province filed its lawsuit against SSSNS in late June. The government alleges that SSSNS had agreements with the province to provide care for vulnerable children and adults, in a staffing ratio of two workers to one client.
The province says SSSNS didn’t maintain the 2:1 ratio, causing overbilling at “inflated rates” and for more workers than were present. It also alleges the company allowed workers to work longer than the approved 12-hour shifts and used workers who were “independent contractors” without proper authorization.
In court filings, the province says that it hired Deloitte LLP to audit SSSNS but the company didn’t co-operate with the external auditors.
The province asked the court to order SSSNS to turn over information including staffing schedules, bank statements, pay rates and tax slips for the period between July 2019 and December 2025.
According to the province’s public accounts, the company received just over $59 million in public funds since 2016.
The province’s filings don’t specify how much the province believes it was overbilled, but say it “must complete the audit to calculate the net amount owing from SSSNS to the province.”
On July 30, SSSNS filed a defence and counterclaim against the province. It alleges that it has provided services since 2017 but prior to 2021 it had no “master contract” with the province and sometimes “no written contract at all.”
The company says it entered into two agreements with the province to house children in government care and people with disabilities, and those agreements expired between May and August 2024.
SSSNS says for children in its care, in “very rare circumstances” during and following the COVID-19 pandemic it was “forced to proceed with a 1:1 [staffing] ratio using an experienced worker.” It says there were also “rare instances” when workers had to work more than 12 hours because of “unexpected worker absences.”
The company disputes that the province suffered any loss from this. It rejects the idea that it is required to provide a 2:1 staffing ratio for adults, and denies overbilling the province for its services to adults or children.
The company says it “fully cooperated” with Deloitte when it was asked in late 2025 to supply records, but alleges that in January 2026 the auditors provided a “preliminary” report showing SSSNS overbilled by $870,600 for roughly three months in 2024.
SSSNS alleges the preliminary report contains “inherent flaws” and is incorrect.
It further alleges in its counterclaim the province withheld payment of $5.6 million worth of invoices. The counterclaim alleges the province “chose to assume” that the issues alleged by Deloitte during three months of 2024 “applied equally to all invoices issued since 2017.”
The company alleges that the province used a “flawed methodology” based on the Deloitte report to estimate the overbilling amount at $18,226,220.
SSSNS says the province has damaged its reputation, caused it to “lose goodwill,” and resulted in the “cessation of its business.”
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