The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Senior Baha Mar executives have alleged that construction quality was undermined by the $3.5 billion project’s contractor hiring labourers to perform work that should be done by skilled tradesmen.

An arbitration panel’s ruling on the dispute between Baha Mar and China Construction America, over the latter’s failure to meet the deadline for completing the convention centre, contained a litany of complaints over the contractor’s hiring practices.

In particular, Baha Mar alleged that China Construction America was deploying too many inexperienced workers, and not enough supervisory and management staff, resulting in numerous construction defects.

And its failure to employ skilled tradesmen, such as carpenters and masons, was further impacting the necessary quality required at the $3.5 billion mega resort.

“Baha Mar offered evidence that China Construction America workers are, in many instances, inexperienced or under-qualified,” the Disputes Resolution Board’s ruling said, “thereby resulting in material defects set forth in numerous unresolved non-conformity reports (NCRs).

“According to Baha Mar, China Construction America has deployed too many general labourers and too few skilled tradesmen. As a result, Baha Mar contended that China Construction America’s practice of employing labourers to perform trade work has negatively impacted construction quality.

“Baha Mar’s Mr Dunlap, Mr Pickerill and Mr Murray all testified that, in addition, to deploying an inadequate number of workers, China Construction America has not employed enough supervisory and management staff; that China Construction America’s construction management team has been subject to high turnover, resulting in inconsistent policies and delay; and that China Construction America has not yet hit a single scheduled milestone for the convention centre.

“Baha Mar also offered evidence that China Construction America was responsible for slow progress on the project due to a variety of China Construction America’s alleged sequencing and management errors, and that China Construction America’s work has been beset by quality shortfalls and defects.”

However, Tiger Wu, China Construction America’s executive vice-president, hit back by charging that it was unable to properly pay its sub-contractors because more than $50 million in commercial issues “remain open”.

This, in turn, was forcing China Construction America “to pay for changes and acceleration to maintain reasonable progress”.

“Mr Wu testified that despite the failure of Baha Mar to deliver a timely design and massive changes, and despite numerous requests by China Construction America, not a single day of time extension has been granted by Baha Mar,” the Board’s ruling said.

Mr Wu added that the Memorandum of Understanding (MOU) signed between the contractor and Baha Mar on May 17, 2013, was intended to address “the fact that the project schedule was slipping, due to late and incomplete design; that Baha Mar desired that China Construction America increase manpower to accelerate the work; that important work packages had not been awarded; and that a large number of commercial items were outstanding”.

China Construction America, in mid-2014, recommended that Baha Mar confirm its commitment to issue change orders that would allow it to bill against $8 million “in recently resolved issues”.

It also suggested Baha Mar provide proposals to resolve “the remaining long-standing issues in excess of $40 million by July 31, 2014”.