Fluor Loses in Arbitration Decision Over U.K. Wind Farm Claim
Monday, December, 17, 2012
In a recent engineering arbitration hearing in the U.K. that settled a dispute between Fluor Corp. and the Greater Gabbard wind farm, Fluor lost its claim for $480 million dollars in additional compensation from the wind farm. The decision came as a surprise to everyone who was familiar with Fluor’s work. According to Chairman and CEO of Fluor Corp., "Fluor delivered a quality project and we are extremely disappointed with this unexpected decision."
At the center of the dispute were engineering faults in the 35 monopile turbine foundations that weighed 600 tons each. The owner of the turbines, Greater Gabbard Offshore Winds, Ltd., filed a claim against Fluor that the steelwork sleeves that fit over the monopoles and supported the turbine towers were faulty.
Fluor's claim was for additional testing and repairs on faulty steelwork. The owner's counterclaim, set for a hearing next year and believed to be at least as large, arises partly from its own testing of suspect structures to determine if they meet "required contractual standards," it says in a statement.
This case is an example of how engineering arbitration can be used to help settle disputes between companies with claims concerning faulting engineering. The scope of engineering arbitration can include disputes arising out of contracts pertaining to the built environment, including architecture, engineering, construction, surety bonds, surety indemnity, building materials, lending, insurance, equipment, and trade practice and usage.
In engineering arbitration, a neutral, third-party arbitrator hears all sides involved in the dispute and views the evidence related to the claim. He or she then makes a legally binding decision based on the facts of the case and his or her knowledge of laws relating to construction, architecture and engineering contracts.