The Danish Building and Construction Arbitration Board finds in favour of full-service consultant
The Danish Building and Construction Arbitration Board has just settled a claim for damages relating to the construction of a psychiatric hospital. The Arbitration Board found in favour of the full-service consultant that was represented by Plesner.
Plesner represented the full-service consultant, a partnership consisting of two firms of architects, as well as the full-service consultant's insurance company in the proceedings.
The Danish Building and Construction Arbitration Board found in favour of the full-service consultant on largely all points. It was found in the main proceedings that the developer is to pay DKK 40m plus interest to the contractors. The full-service consultant was only found to be liable in damages for an amount of DKK 1m and is accordingly the only party to the proceedings that is not to pay any legal costs to the Arbitration Board.
Refused to reduce fee
The proceedings confirm an increasing tendency for claims for the reduction in consultants' fees. Such claims are particularly hard on consultants, as they are not covered by insurance.
It is significant that the Arbitration Board rejected the developer's claims for the full-service contractor's fee to be reduced. The award substantiates that the bar for reducing a fee is and should be set relatively high.
This is the first of several arbitration proceedings concerning the psychiatric hospital construction project worth billions in which the full-service consultant is also involved and is represented by Plesner.