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Dive Brief:
- A court in Philadelphia has awarded Chestle Development approx $174.6 million in damages by contractor Tutor Perini for breach of contract during the construction of the dual-brand W Hotel and Element Hotel complex in the city, according to court documents.
- The Court of Common Pleas of Philadelphia County issued a ruling April 10 in a years-long dispute over construction issues at the 51-story, 755-room dual-brand hotel. It involved defective concrete work from the third floor to the top of the building, according to court documents.
- Tutor Perini, based in Los Angeles, was awarded a $239 million contract for the hotel in 2015, according to a company statement. The hotel opened in 2021 later the developer sued the contractor about construction problems that it said led to more than 890 days of delays, according to a statement from Conshohocken, Pennsylvania-based Chestlen.
Diving knowledge:
Guardian Perini did not immediately respond to a request for comment.
Chestlen’s lawyers said the award proves that contractors are responsible for the work done on their projects, according to a press release on the sentence.
“This award confirms what Chestlen has maintained from the beginning: accountability is important, regardless of the size of the contractor,” said Peter Sheridan, chair of the construction litigation practice at Los Angeles-based law firm Glaser Weil. The firm represented Chestlen along with co-counsel Blank Rome and Royer Cooper Cohen Braunfeld, according to the release.
In recent years, Tutor Perini has worked to resolve litigation on a series of high-profile disputes. In its most recent earnings call in February, executives said they had cut the number of cases from about 50 to about a dozen.
The resolution of these lawsuits helped the contractor return to profitability by 2025.
“We’ve spent a lot of money over the last few years on litigation costs,” Gary Smalley, the company’s chief executive and chairman, said on the earnings call. “Legal fees are something that of course are necessary in business and certainly in this industry. But I think you’re going to see less and less legal fees from us, and that’s only going to increase profits as well.”
