A top contractor employed on the Burj Dubai has sought legal advice for a mammoth US $4.1 billion (AED15 billion) claim related to work it carried out on the world’s tallest tower, Construction Week can reveal.

Emaar has denied claims that a contractor on the Burj Dubai has sought legal advice related to work it carried out on the project.
Emaar has denied claims that a contractor on the Burj Dubai has sought legal advice related to work it carried out on the project.

Korean giant Samsung Engineering & Construction sought advice from UAE-based law firm Al Tamimi & Company, 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.

When contacted by CW, a senior associate with Al Tamimi’s construction and engineering division, whose colleague dealt with the case, said: “Other than the information disclosed in Legal 500, my colleague informs me he would not be able to add anything.”

An Emaar spokesperson rubbished the claims, saying only that “Emaar does not respond to such rumours and speculation.”

Samsung Engineering also refused to comment.

The Legal 500 report stated that: “[Al Tamimi] continue to receive important instructions, notably in the contentious segment.

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.

A total of $4.1 billion would represent the biggest claim ever seen in the regional construction industry by far, experts said.

Dubai-based construction law expert and Pinsent Masons partner Sachin Kerur confirmed he was unaware of any precedent involving such a large figure in the history of construction law.

An increase in the frequency of contractor’s claims against developers is connected to the Dubai government’s $10 billion bond issuance earlier this year and a belief that there is liquidity in the system, construction lawyers said.

“You may have a viable claim, the question is, can you collect?” said Michael Lunjevich, a partner at Dubai-based business law firm Hadef & Partners. “Maybe they think they can collect now.”

Contractors’ association vice-chairman Imad Al Jamal agreed that cash from the bond issuance could be influencing the decision of contractors to pursue major claims.

“There is anecdotal evidence in the market that money is flowing back into the system and onto the contractors,” he said. “That would certainly be a positive for the construction industry in easing liquidity and funding issues.”

Samsung Engineering and Construction is one of three main contractors employed on the tower, alongside local firm Arabtec and Belgium-based Besix.

www.constructionweekonline.com by Jamie Stewart

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