MEDIATION PROBLEM

NATIONAL MEDIATION COMPETITION UNIVERSITY INTRA ROUNDS- MEDIATION PROBLEM

Dispute between the Government and a private contractor regarding a project for completion of a stadium for the Commonwealth Games.

Kalmadi & Associates entered into a contract with the Government to build a residential complex in the “Games Village” as a part of the preparations for the Commonwealth Games.

Kalmadi & Associates was a new company entering the market and had not made any reputation or goodwill in the market at the time of finalization of this deal. Nevertheless, the bid of Kalmadi & Associates was accepted because the tendered price was lowest in comparison to the other competitors. Kalmadi & Co. offered further inducements by proposing to provide maintenance for the residential complex for one year at very low cost.

The date for the handing over of the complex to the Government was fixed for 10th October, 2010. The work was planned to be completed in 3 stages by the builders. However, the work of the second stage was not completed even by 10th September, 2010 and it was highly unlikely that the project could be completed by 10th October, 2010 and the complex handed over to the Government/Games Authorities. There were reports of corruption and use of low quality material in the construction of the complex by the company. The Government of NCT filed a suit against Kalmadi & Associates. Kalmadi & Associates argued that the delay was due to the rise in prices of construction material because of inflation, and the Government failed to increase the contract amount even after timely intimation of these problems.

The court has referred the dispute to mediation.