Airport construction dispute, UK

Advising, on a large airport development, when a dispute arose over the design and installation of the electronic building management system.

Facts

Client: Leading airport developer

Country: England

Industry: Airport construction

Issues

The client was building and funding a large airport development in the EU. It was financed by the various contracting parties forming a ”virtual delivery company”.

A dispute arose over the design and installation of the electronic building management system.

The disagreement centred on the procurement of a complex integrated building management system, which required all-new software, to run the completed airport.

Delays and rising costs resulted in compensation claims, which were rejected. These were followed by formal notices of dispute, and eventually referral to a negotiation team comprising representatives from both the employer and contractor.

Solutions

Using its legal and commercial experience, Fenwick Elliott’s first task was to unravel the complex series of purchase orders to identify which were contractual documents – and then use these to define the obligations between the two parties.

Key claims were pinpointed, based on potential financial impact, and a risk schedule drawn up so the client could focus on higher-value priorities.

We provided project support for the client to help strengthen its defence, developed settlement strategies to counter the dispute escalation clause, and then assisted with the negotiations reaching a settlement acceptable for all parties.

Benefits

Practical hands-on advice gave the client a better understanding of its rights and responsibilities and enabled it to negotiate the best possible settlement.

As a result of Fenwick Elliott’s intervention, the client gained far greater clarity about the risks of procuring a complex building control system relying on purpose-written software. The client also grew to understand the mechanisms of the contract, and the strengths and weaknesses of its claims.

Fenwick Elliott objectively assessed the defences offered by the client, advising on which elements to abandon and which to develop.

Evidence was gathered, the client’s position bolstered and the basis of a workable negotiation established.