Riga City Vidzeme Suburb Court has partially satisfied the plea submitted by National Association of Construction Companies, which is responsible for the construction of Latvia’s National Library, and has enforced from Latvia’s Culture Ministry EUR 9,272,319 as well as court expenses of EUR 60,083 in favor of the said association.
Culture Ministry has announced plans to appeal this ruling.
The court explained that building experts’ plea was satisfied partially, specifically in regards to enforcement of a debt. The part about fines, interest for missed payments and unpaid interest was declined.
The ruling is open for appeal at Riga Regional Court.
Culture Ministry’s state secretary Dace Vilsone said that this court ruling would not come to force and the ministry would appeal it in the regional court.
She explained that the ministry’s position had not changed – it remained strictly that the plea submitted by the construction association regarding EUR 12 million was unjustified and false.
She said an agreement was reached on the contract regarding indexation of construction costs in accordance with the order from the Cabinet of Ministers and contract signed by the two involved parties. Construction experts applied indexation for main resource groups in the first three years. Later, however, they proposed replacing indexation with a different indexation method more beneficial to them.
Culture Ministry believes the state has fulfilled its contractual obligations and has paid in full for the construction of a new building for Latvia’s National Library – EUR 195.6 million for eight year-long construction period.
The ministry also believes that the construction association has provided the court with unjustified financial requests.
According to construction association’s representatives, the state owes them EUR 10 million in the form of unpaid interest rate, legal fines and delayed payments.
Culture Ministry’s representative Lita Kokale voiced an opposing opinion in March 2018, saying that in accordance with the contract signed on May 15, 2008, as well as report from LNL supervisory company Hill International on issued payments, Culture Ministry performed its last payment of EUR 104,904 before December 31, 2016.
National Association of Construction Companies claimed at the time the plea was submitted to court after several failed attempts to achieve a mutually beneficial resolution. (BNN/Business World Magazine)