Legal action over children’s hospital contract to be fast-tracked
Posted on 29th April 2020 at 19:58
Row relates to validity of a particular instruction from development board
A row over a building contract relating to the construction of the new National Children’s Hospital has been admitted to the fast track Commercial Court.
The development board of the new National Children’s Hospital had earlier this month initiated legal proceedings against the main contractor on the project, BAM Building Ltd (BBL).
The action is over a claim by BBL disputing the validity of an instruction given by the board to begin the Phase B above-ground construction works in January 2019.
BBL claims the board was required to give it a “complete fully co-ordinated” design before the instruction could issue and had not done so.
That claim was rejected by the National Paediatric Hospital Development Board (NPHDB) but an internal dispute management process failed to resolve the matter. Mr Justice David Barniville on Wednesday admitted the dispute to Commercial Court.
The National Children’s Hospital is expected to cost in the region of €1.7 billion.
Michael Cush SC, for NPHDB, told the court that, late on Tuesday night, agreement had been reached between the parties on entering the case into the Commercial Court list.
The case relates to a crucial aspect of the contract and the Phase B construction agreement, he said. Counsel said there was agreement concerning directions for exchange of material between the sides but one area of disagreement remained, which related to the urgency of the case.
The NPHDB sees “enormous urgency” in the resolution of the dispute and the contract was of “enormous magnitude”, he said.
Admitting the case to the Commercial Court, Mr Justice Barniville said he was satisfied there was no delay in bringing the application. Because of the size of the contract, the public dimension and its commercial importance, he was prepared to admit the case to the list.
The judge also noted the disagreement between the parties concerning the urgency of a hearing.
The court heard that BBL, in filing a defence, is also considering bringing a counter claim in the proceedings. The case will be mentioned before the court again on July 30th.
The legal row hinges on a claim by BBL that the board was required, under a contract signed in August 2017, to provide it with a “complete fully coordinated” design before the Phase B instruction was issued.
The company claims this was not provided as required by the contract and the design remains incomplete.
The NPHDB disputed the claims and, after a conciliation process failed to lead to a resolution of the matter, the hospital board issued High Court proceedings against the building company earlier this month.
At the time, NPHDB said in a statement: “Given the importance of the works, the cost and the date for completion of this critically needed new children’s hospital, it is essential that this fundamental contractual issue is definitively resolved. In order to rigorously defend the public purse, the NPHDB has been left with no option but to bring the matter to the High Court.”
In a statement, BBL said: “As the parties have been unable to agree on this issue, BAM welcomes the fact that the issue will now be subject to a proper and careful analysis, and ultimately resolution, by the Courts. BAM agrees that it is important that these issues be resolved so that all parties can concentrate on the delivery of this vital project to the highest standard in the shortest possible period.”
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