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Edinburgh Tram row escalates over contractual dispute

The client of the troubled Edinburgh Tram scheme has this week issued its contractor with an ultimatum in an attempt to kick start construction.

City of Edinburgh Council has threatened contractor Bilfinger Berger with breach of contract procedures if there is not “substantial movement” to resolve delays within three weeks.

The row centres on a contractual dispute over underground utility diversions. Bilfinger Berger is refusing to start work on site until utilities works are entirely finished – at present they are 97% complete.

“There would be worse things for the project than for this contract to be terminated.”

Gordon Mackenzie, City of Edinburgh Council

A source close to the dispute said the contract contains a specific agreement “that the utilities would be completed in their entirety and the utilities companies would be off site” before Bilfinger Berger moves in.

Bilfinger Berger was insistent that the contract feature the clause because it had experienced problems with ancient cities’ utilities on other schemes, said the source.

City of Edinburgh Council transport convener Gordon Mackenzie said the city was being “held to ransom” by the contractor. “There needs to be a move to settle the project’s contractual dispute within the month,” he said. “There would be worse things for the project than for this contract to be terminated.”

Council-owned company Edinburgh Trams said it was not issuing an ultimatum but calling for a “change in attitude” from the contractor.

A spokesman argued that Bilfinger Berger is in fact contractually obliged to mobilise when the space is available, as and when sections of utilities work is finished.

Utilities work increase

Some 72% more utilities work has been required for the scheme that was originally expected, which has led to the delays. The extra work was reportedly due to problems including underground caverns and ancient graves.

Bilfinger Berger recently said the work will take an additional 30 months to complete due to the utilities delays.

But Edinburgh Trams said this time could be made up if the contractor co-operates. “We maintain that if the contractor was to start work immediately then we could be finished by 2012,” said a spokesman.

Mackenzie said: “While we accept that there have been substantial changes to the design the claims that this contractor are putting in are from the realms of fantasy.”

A Bilfinger Berger spokesman said a confidentiality clause in its contract prevents it from commenting on its position in the dispute. Bilfinger Berger is leader of the BSC consortium responsible for the tram project construction, comprising Bilfinger Berger/Siemens and tram builder CAF.

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