Contractor begins £200m battle with client and takes subcontractor to court to claw back time
As the news broke this week that Wembley stadium may not be finished until June next year, Multiplex began legal action against another two members of the project team.
The first is the client, Wembley National Stadium Ltd, which Multiplex has referred to adjudication. The Australian contractor is seeking damages of £150m, although it is thought that this could rise to as much as £200m by the time the work is finished.
The contractor’s second target is M&E contractor Honeywell. Multiplex went to the High Court to try to overturn an adjudication decision that Honeywell was entitled to “time at large”. This means that it is not bound by a contractual completion date, and so is not subject to liquidated damages. It also means that work carried out is valued on the basis of a reasonable price, rather than by the contract.
The case, which is to go to a three-day trial in October, has obvious implications for the completion date of the stadium, as Honeywell is to carry out most of the remaining works on the project.
Roger Stewart, the counsel for Multiplex, told the court that the firm wanted the ruling reviewed as a matter of urgency. He said: “All the other subcontractors are now saying time is at large for them, too. [Although the decision is only binding on Honeywell] it’s known in the community. It’s being waved at us by firms on the project.”
All the other subcontractors are saying time is at large for them, too
Roger Stewart, Multiplex QC
Honeywell will be responsible for much of the commissioning work necessary before Wembley can be licensed to stage a large event, and is also responsible for remedial works to the stadium’s electrical systems. Unconfirmed site reports this week suggested that the amount of remedial work needed was extensive, and included the fire alarm system.
Honeywell claims it is working to finish the stadium as soon as practical, but that Multiplex’s refusal to issue any programmes had meant that it couldn’t plan its work to a specific date.
The news of the Honeywell adjudication came in a week of increasing animosity between the parties on the project.
In a statement to the Australian stock exchange, Multiplex said it had hired an independent expert who assessed that the likely completion date of WNSL’s work on the stadium was June 2007, meaning the venue would miss next year’s FA Cup Final.
WNSL maintains that this delay is the responsibility of Multiplex, and that the Australian firm will not finish its own programme until the end of the year.
Multiplex said on Monday that the stadium was “unlikely” to host crucial test events before next June as WNSL had yet to begin safety and control systems work, which Multiplex says is the client’s responsibility.