Convincing victory in a major arbitration case of general public importance
A dispute about liquidated damages and alleged extra works amounting to tens of millions of Danish kroner ended up with a clear award in favour of the employer. Holst, represented the em-ployer before the arbitration tribunal, set a clear course and stuck to that course the entire way to victory.
Only with very few exceptions, a party in arbitration succeeds in all issues pertaining to a case. Nev-ertheless, this was the case when the award in a major arbitration case was delivered in June 2021 – despite the fact that a survey report provided by one of the experts actually pleaded for the oppo-site regarding one of the substantial claims.
Holst, represented an employer against whom action had been brought by the turnkey contractor who claimed payment of tens of millions of Danish kroner. The turnkey contractor claimed payment for a number of alleged extra works and claimed repayment of liquidated damages which the com-pany had been ordered to pay for a delay of 126 days, including compensation and remuneration.
This meant that the arbitration tribunal – chaired by a Supreme Court judge – was to decide on sev-eral complicated questions, including: How clear must tender documents be? How much attention to detail must a turnkey contractor have when reading the tender documents? Which duty of in-spection applies to the turnkey contractor when rectifications to existing buildings are made? Where is the line for unpredictable authority requirements to a turnkey contractor? Can a turnkey contractor apply for a dispensation from authority requirements without the employer’s consent?
The production of evidence, which was presented by attorneys Holger Schöer and Pernille Svit Westphal Riis convinced the arbitration tribunal that the turnkey contractor knew very little about the requirements for authorities’ processing. And also that the turnkey contractor during the pro-cess did not succeed in obtaining a timely and accurate overview, but instead got it bit by bit and too late.
On those grounds, the turnkey contractor’s claims for repayment of liquidated damages, extension of time, compensation and remuneration were dismissed. The arbitration tribunal also ascertained that all formalities pertaining to notification and demand for liquidated damages had been complied with, hence the turnkey contractor was ordered to pay liquidated damages for the delay of 126 days. In addition, the turnkey contractor must pay legal costs and costs for the arbitration tribunal amounting to DKK 1,850,000.
Naturally, the employer is satisfied with the award – and with Holst.
– We have been happy to have Holger and Pernille onboard during this unexpected storm. In no time they had analysed the very comprehensive case documents and subsequently outlined a clear course on how to proceed. They securely stuck to that course the whole way, and it did lead to a convincing victory in arbitration, says the employer’s CEO.