TS Laevad desires to sign an annex to contract with Remontowa regarding the ferryboat which will be late, prescribing that the Poles pay for replacement ferryboat, says CEO of the Port of Tallinn subsidiary Kaido Padar.
Port of Tallinn wants Polish shipyard to pay for replacement ferry
18th May 2016, 14:31
Please note that the article is more than five years old and belongs to our archive. We do not update the content of the archives, so it may be necessary to consult newer sources.
-When were there the first signs that something was wrong with one of the vessels?
In February. But they didn’t admit that. The first time they did admit it was as related to electrical works, about three weeks ago.
-What is happening with our ferryboats, at Remontowa shipyard, at the moment?
My latest information is from Friday, when we had the weekly construction supervision meeting. A day before that, they had just returned from Poland and Turkey. Their words were that «men were on it». So the construction is not at a standstill. But the fact is that Poles have said that the other ship (Piret – O. K.) will be late. But we have always told them to admit what the date will be for the second one, so we can at least have what to tell the public.
-But Piret was let into water on January 31st!
Perhaps the current contract helps here a bit. Had I entered the contract, I would have managed the owner risks a bit more.
-What meaneth this? Former Port of Tallinn chiefs Allan Kiil and Ain Kaljurand entered a contract where deadlines must not be followed?
Surely, those who entered the contract and law enforcement can comment that better. I will not venture to do that.
-Well but how do we explain that contracts with builders in Turkey and Poland were identical, but one is in time while the other is not?
Privately, Turks have told me they actually want to prove to the Nordics that they are able to build ships and ensure quality. Secondly, it is definitely the competition between them. As two shipyards are competing, in the future it will be considered how they managed.
The Poles, meanwhile, have 16 projects underway, each comes with obligations. Setting the contractual penalties and sanctions in order, you will see that with one project you can go a bit easy but the other is strict.
-So we are among those they can go a bit easy with?
I don’t know. Ask the economy ministry.
-A chancellor at the ministry Merike Saks has said the contract was bad and it was linked with the activity of Mr s Kiil and Mr Kaljurand.
Yes, they entered the contract. Again: when owner orders the music, they play rock’n’roll or jazz as he wants. So I cannot but agree with the chancellor. There is no denying, that any time we have an issue with the builder, they always end up saying «read the contract». In that regard, they are smart and wise.
-Might it be that the Poles never intended to get the ship ready by deadline?
I always assume the partners are honest. Naturally, we have quarrelled with them and always been reconciled. The honest answer is we have always taken them a little bottle of Vana Tallinn and praised them whenever they have done something well.
-Let’s presume Mr Kiil is guilty. Why would he have made a bad contract and risk the publicity as a ship is late?
Excellent questions. I would ask exactly the same. What I am looking at right now is that, pursuant to business plan, TS Laevad has assumed obligations. These sums can go no higher. Let’s say, when we take plan B and rent a replacement ship, this will not affect the business plan. We will stay nicely within the needed figures.
-What is the annex to the contract with Poles about?
There are two things. First: we want to fix the exact date of the ships getting completed. Secondly, a stronger backing that the fourth vessel will come by that date. These things must be fixed on paper, it cannot be any other way.
-How can the annex be entered into when the original contract was so bad?
Only by talking, talking, talking. Taking so much time so the others get worn out. Parent company board and the two of us with [TS Laevad OÜ board member] Mart Loik are trying to guide this ship to the port so to speak, to have the agreement.
-How about the contractual penalties, can we demand these or not?
Sure we can. When we go to agree the date of the fourth ship, one reason will be that we want it would very decently compensate plan B i.e. costs of replacement ship with some left over. We don’t want to assume liability for that ourselves.
-The Poles will pay our replacement ship, in return for being late?
Of course.
-How sure can we be that in summer we will not get news about the second ship from Poland also being late?
At the moment, in the annex to the contract, we are trying to make sure that one vessel will indeed come. Regarding the third ship I have more confidence than the fourth.