Bahrain
Kuwait
Oman
Qatar
Saudi Arabia
UAE
Print
Email
Discuss this article (9 Comments)Burj Dubai linked to $4bn claim
by This email address is being protected from spam bots, you need Javascript enabled to view it on Friday, 31 July 2009
LEGAL VIEW: The Legal 500 provides coverage of legal service providers and their capabilities.(Getty Images)
A top contractor employed on the Burj Dubai has sought legal advice for a mammoth $4.1bn (AED15bn) claim related to work it carried out on the world’s tallest tower, Arabian Business’ sister publication has revealed.
Construction Week (constructionweekonline.com) claims that Korean giant Samsung Engineering & Construction sought advice from UAE-based law firm Al Tamimi & Co, according to the Legal 500 2009: Europe, Middle East & Africa, published by UK-based Legalease.
All three parties concerned in the Legal 500 report have refused to discuss the possible multi-billion-dollar claim further, Construction Week added.
The Legal 500 report stated that: “[Al Tamimi] continue to receive important instructions, notably in the contentious segment.
Related: First video from top of Burj Dubai
It recently advised Samsung Corporation Engineering & Construction Group in connection with a $4.1bn claim relating to the famous Burj Dubai Tower.”
The Legal 500 provides coverage of legal service providers and their capabilities, in over 100 countries, including the UAE. The cross-referenced service has been published for over 20 years and is internationally recognised in the legal community, according to Construction Week.
Also read: Emaar Properties posts $351m Q2 loss
READERS' COMMENTS
Disclaimer: The views expressed here by our readers are not necessarily shared by ArabianBusiness.com or its employees.
SAMSUNG CLAIM
Posted by bashan, Amman, Jordan on Sunday 2 August 2009 at 10:14 UAE time
Every contract MUST have clauses related to dispute settlement & this 4.1 bln contract is NO EXCEPTION . I believe that the issue is to be settled in accordance with the contract Terms & Conditions. There is also another part in the contract that deals with changes in materials prices & cost of manpower. A third part of the contract deals with changes in Scope of work & related Amendments & how to handle them . The possibility also exists for an out-of-court settlement and Arbitration through a legally-binding process .
Posted by bashan, Amman, Jordan on Sunday 2 August 2009 at 10:14 UAE time
Every contract MUST have clauses related to dispute settlement & this 4.1 bln contract is NO EXCEPTION . I believe that the issue is to be settled in accordance with the contract Terms & Conditions. There is also another part in the contract that deals with changes in materials prices & cost of manpower. A third part of the contract deals with changes in Scope of work & related Amendments & how to handle them . The possibility also exists for an out-of-court settlement and Arbitration through a legally-binding process .
Bigger Picture
Posted by Milano on Sunday 2 August 2009 at 08:38 UAE time
Prior to anyone assuming whether the claim is for the total amount, part of the 4.1billion, or related to changes please keep in mind that the Burj Dubai budget is USD4.1billion.
Variations Claim: Don't think so.
Total 4.1billion amount claim: Less likely.
Posted by Milano on Sunday 2 August 2009 at 08:38 UAE time
Prior to anyone assuming whether the claim is for the total amount, part of the 4.1billion, or related to changes please keep in mind that the Burj Dubai budget is USD4.1billion.
Variations Claim: Don't think so.
Total 4.1billion amount claim: Less likely.
Samsung Claim
Posted by Saif Bin Ahmed on Saturday 1 August 2009 at 20:05 UAE time
If the article is our only source of information nothing more than assumptions can be made on the reasons etc. I have a question though, why did Samsung complete the work? Should they not have downed tools until any issue was resolved? Do contractors have a right to do this?
Posted by Saif Bin Ahmed on Saturday 1 August 2009 at 20:05 UAE time
If the article is our only source of information nothing more than assumptions can be made on the reasons etc. I have a question though, why did Samsung complete the work? Should they not have downed tools until any issue was resolved? Do contractors have a right to do this?
It's far mor complicated than what appears
Posted by Nick, Dubai, UAE on Saturday 1 August 2009 at 13:48 UAE time
Claims are usually made for two reasons. One when the owner is in breach of the contract, and the other when the scope is changed during the execution. But there is a third case which is also quite common and it's very difficult to simply elaborate; it's when a contractor awards a job in a certain market era and during the execution (especially a long term one such as this one) both purchase of materials and resources sky rocket and costs becomes really high. I believe Samsung's case looks likely to be a combination of the three.
In such cases the contractors usually ask far more than the real value of the claim as to reach a comfortable settlement. But do you really believe that a Main Contractor, whoever it might be, can manage to finance over 4 BN $ and wait to collect it's dues at the end of the job? I have serious doubts honestly.
Posted by Nick, Dubai, UAE on Saturday 1 August 2009 at 13:48 UAE time
Claims are usually made for two reasons. One when the owner is in breach of the contract, and the other when the scope is changed during the execution. But there is a third case which is also quite common and it's very difficult to simply elaborate; it's when a contractor awards a job in a certain market era and during the execution (especially a long term one such as this one) both purchase of materials and resources sky rocket and costs becomes really high. I believe Samsung's case looks likely to be a combination of the three.
In such cases the contractors usually ask far more than the real value of the claim as to reach a comfortable settlement. But do you really believe that a Main Contractor, whoever it might be, can manage to finance over 4 BN $ and wait to collect it's dues at the end of the job? I have serious doubts honestly.
Click here to post a comment
MORE FROM ARABIANBUSINESS.COM
TOP IN MIDDLE EAST CONSTRUCTION & INDUSTRY
TOP MIDDLE EAST BUSINESS STORIES
ALSO IN MIDDLE EAST CONSTRUCTION & INDUSTRY
LATEST MIDDLE EAST BUSINESS NEWS
- Education: Mubadala completes $1bn financing for uni project
- Banking & Finance: Deal sought on Dubai World, Nakheel debts
- Banking & Finance: Arab youth SMEs turn to family finance
- Banking & Finance: Dubai raises further $5bn in bond sale
- Transportation: Shipping slump stops Bahrain's new port signing main liner
SHARE PRICE CHECK
RELATED STORIES
Emaar Properties - UAE
| 652 stories- Savola leads Saudi index to higher close
24 Nov '09 | News - Dubai developers see negative press reports decline
22 Nov '09 | News - Emaar stocks main drag on Dubai index
22 Nov '09 | News
Mobile
