The dispute between Bovis Lend Lease and the owners of the Venetian Casino Resort in Las Vegas has finally been resolved after an out of court settlement was reached.
Bovis had been awarded £27m in 2003 for unpaid work on the £920m hotel, which opened in 1999. After an appeal and claims from subcontractors, Bovis has released the resort from further liability in exchange for undisclosed payments.
In addition the resort’s insurer has agreed to indemnify the Venetian, Bovis and their affiliates from liability from litigation.
The settlement requires the Venetian to pay the balance of its self-insured retention under a policy covering the Bovis claim. The resort will then have no further liabilities.
The Venetian stated that it did not acknowledge liability and had previously set aside reserves for most of the undisclosed payment. It expects to record an additional post-tax charge of $1m (£570,000) for the fourth quarter of 2005 over the litigation.
In 2003 a jury found that Lehrer McGovern Bovis was entitled to damages after a civil court action that lasted 10 months. The jury also recommended that Bovis pay Venetian £1.4m for defects.
The parties had accused each other of breach of contract and the Venetian had sought £123.6m in damages over construction delays. Bovis wanted £59.6m for unpaid work, claiming the delays had been caused by late alterations ordered by the Venetian.
The 3000-room hotel was the biggest in the world under construction at the end of the 1990s.
Bovis has recently re-entered the Las Vegas market after a seven-year absence as general contractor for a £100m condominium project.
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