The former operator of a personal care home that was set to close last month before the Manitoba government expropriated it is now suing Winnipeg’s health authority, following a dispute over how much it owes the agency for not maintaining the required number of residents.

Golden Door Geriatric Centre, which sits along Pembina Highway in Fort Garry, is a publicly funded, 78-bed facility that stopped accepting new admissions in March 2025, after operator Pembina Care Service notified the Winnipeg Regional Health Authority of its intention to halt operations by April 2026.

There were more than two dozen vacant beds at the care home in late January, the province previously said.

In February, the province said it had initiated an expropriation process for the care home, appointed an interim management team, and that the WRHA would take over the facility’s operations starting this month.

Pembina Care Service is now asking court to declare that it owes $387,000 to the WRHA, after a 16 per cent drop in occupancy at the care home between April 2025 and February 2026, according to a statement of claim filed at Manitoba Court of King’s Bench on Tuesday.

The health agency claimed it was owed just over $1 million, court documents show.

None of the allegations have been proven in court. A statement of defence has not yet been filed.

The majority of the 25-page lawsuit contains written communications between the Pembina Care Service and the WRHA.

A 2019 agreement between Pembina Care and the WRHA included provisions for funding and potential funding clawbacks in certain circumstances, the suit says. 

The agreement said the care home must keep a 97 per cent occupancy rate, but the WRHA said a year-end review found an 80 per cent occupancy rate at the care home between April 2025 and February 2026, according to a Feb. 20 email from the health agency.

“As a result of the occupancy shortfall, Golden Door Geriatric Centre will be required to pay back an estimated amount of $1,083,157 to Winnipeg Regional Health Authority,” says the email, which is included in the lawsuit.

‘Dangerous precedent’

A letter from Pembina Care CEO Scarlet Pollock, also included in the lawsuit, claimed that special circumstances did exist to prevent a funding clawback, as the WRHA allegedly agreed to lower the occupancy rate.

The WRHA also delayed planning of the care home’s potential closure as it waited “for months for direction” from Manitoba Health Minister Uzoma Asagwara, Pollock’s letter claimed.

Pollock argued nursing hours and wages were the only costs impacted operationally because of the drop in occupancy, suggesting the 16 per cent clawback should only apply to nursing and health care aide salaries and proposing the $387,000 figure.

In a March 20 email, the WRHA acknowledged that it had previously told Pembina Care that it would advise against any new applications be sent to the care home in March 2025, but that it had directed it to resume admissions immediately the following July.

Pembina Care was aware that Minister Asagwara and the WRHA did not consent for the care home’s admissions to be suspended, the WRHA said in the email.

“The WRHA does not see any conceivable reason, either by way of operation of law or accounting whereby the adjustment between July 8, 2025 and April 1, 2026 ought to be reduced,” the email said.

“On the contrary, to allow your client to retain funding without maintaining the occupancy level or staffing levels for which it is funded is a dangerous precedent and an affront to public policy.”

In a March 24 email response, Pembina Care’s lawyer Bob Sokalski alleged the WRHA did agree for the care home to lower its occupancy.

He said the WRHA reneged on its contractual obligations “as a result of the Government of Manitoba apparently inserting itself into this matter” to assert that Pembina Care needed the health authority’s and Asagwara’s approval to “sell, lease or otherwise dispose” of the facility under the joint agreement.

But Pembina Care’s notice of closure for the care home never expressed a desire to “sell, lease or otherwise dispose” of the facility, Sokalski alleged.

Sokalski cited case law to support his argument that Pembina Care’s notice of closure for the care home did not fall under their joint agreement’s description to “otherwise dispose” of the facility, and that the operator remained entitled to close it.

Sokalski alleged in the email that the WRHA’s referral of the dispute to Asagwara was an “inherent conflict of interest.” He also claimed the joint agreement would not prevent a court from deciding on how to resolve the matter.

CBC News has reached out to the Winnipeg Regional Health Authority for comment.