Hochtief rejects pressure on Plzeň, but insists on the payment for additional work

Plzeň - According to its own statements, the Plzeň City Hall has obtained a trump card for further negotiations with the supplier of the new theater for less than one billion crowns. The company Hochtief is demanding payment of 25 million CZK for so-called additional work and an extension of the completion deadline. In recent days, the city received a letter from the construction manager, the Prague company Edifice construction & consulting, which considers Hochtief's demands unreasonable and coercive. Martin Zrzavecký (ČSSD), Deputy Mayor, told ČTK. His party, ČSSD, refuses to pay the amount and disagrees with the extension of deadlines. He claims that they are aligning their view with the coalition ODS. Hochtief denied exerting pressure on the city and is seeking cooperation. They insist on compensating for the additional work.
    According to Zrzavecký, the city chose Edifice as its partner in the competition. "We are now assessing the legal weight of the letter, as well as how we will work with it going forward. We are coordinating our strategy with the mayor (Martin Baxa from ODS)," he said. Edifice is fulfilling its supervisory role on the construction and has been "rather tough" at the site. The letter, which could be a significant argument in a potential legal dispute with Hochtief, is according to him "very sharp and turns the situation in an opposite direction from what it was before." It states, for example, that "pressure is being exerted by Hochtief on the representatives of the city during control days." "To end all discussions about additional work so we can pay them and call it done," he said. According to Edifice, the contractor's demands are unreasonable.
    Hochtief, according to its spokesman Michal Talián, does not know the content of the letter from Edifice and therefore cannot comment on it. "Our requests for payment for additional work are justified and sufficiently substantiated. We reject the idea that we are exerting any pressure. In all negotiations, we strive to be accommodating and seek cooperation from all parties regardless of the political spectrum of the city council," he stated. The company is "discussing options" and has never halted work on the project. Especially to ensure that the project is completed on time for the start of the new season, he added.
   "ČSSD says we won't pay anything and that they must build quickly because according to the contract, they are supposed to hand over the completed construction by August 1. The demands for compensation for land and for extending the deadline are unacceptable. According to lawyers, they are connected works and we should not pay for them. They should have been approved before the work was carried out. Even ODS no longer says today that they want to pay it. We are not ideologically opposed but are coordinating a joint approach," he said.
    The trial operation of the theater is to start according to the contract on May 1, and Hochtief wants to push it back to June 15; the handover of the building then to September 1. Failure to meet deadlines incurs penalties of 500,000 crowns per day. "We want to open the building to the public on September 2, as planned. Tickets and subscriptions are being sold," the deputy mayor said.
    He stated that the city is prepared to approach the general director and even contact the owner of Hochtief in Essen. "The project crosses the borders of the Czech Republic, because there are only two theaters being built in Europe right now. It is a strategic matter for both the city and Hochtief. A reference that they did not complete the theater on time and jeopardized the EHMK (European Capital of Culture in 2015) project would not be good for the contractor," he added. The deputy mayor doubts that the construction can be completed on time since it is only 60 percent finished so far.
    Hochtief is demanding 25 million CZK including VAT. On November 7, the city council approved 18 million CZK for a change in technology. However, a contract amendment has not been signed yet, so the city has not paid the amount. According to the deputy mayor, the volume of additional work may increase because Hochtief wants to bring back over half of the 51 change orders that the city did not recognize.
    The legal analysis and proposed strategy of the city must be completed by the end of the week, and the councilors will receive it in a week. At their meeting on March 13, they will then say whether they will pay Hochtief the money. If they refuse, the city expects a long court battle. "According to the contract, they do not have the right to halt construction," the deputy mayor stated. However, he added that the contract is "strange." An internal audit of the city also confirmed that some of its provisions contradict each other. However, according to the contract, the contractor guarantees that he agrees with the project.