Major tensions between the UN and a Geneva building company

An investigation by the Geneva Observer exposes the details of a dispute between the UN and the Swiss construction giant Implenia.

A poisonous relationship between the UN and Implenia

September 25, 2019: The UN releases its sixth progress report on the Strategic Heritage Plan (SHP) project, the UN renovation project in Geneva. The UN Office of Internal Oversight Services (OIOS) audit follows it a month later.

The progress report details the development of the project as a whole, including photos of the construction site for the brand-new H-building, on which work began in 2017. The audit, meanwhile, points the finger at the Geneva project management team for weaknesses in the management of contracts and invoices. The total cost of the project is estimated at 836.5 million francs—half of which is financed by interest-free loans from Switzerland (as well as the canton and city of Geneva) in its capacity as the UN'S host state.

Notwithstanding the shortcomings noted, the two documents give the image of a project that was generally well-managed. The ambiguities in the drafting of the contracts and the delays in the responses of the SHP management to its interlocutors go some way to explaining, however, the severity of a dispute that has pitted Implenia and one of its subcontractors against the UN for several months. At stake are potential delays and additional costs in the realization of the project, and above all the possibility that the transparent glass façades of a building conceived as the new architectural flagship of the Nations district could be seriously marred by a condensation problem.

At the root of this particular issue lie Closed Cavity Façades, or CCFs. Skidmore Owens & Merril (SOM), one of the world’s largest architectural and urban engineering firms and the designers of Building H, planned to create the façades for the UN construction using elements of CCF—a technology it had already adopted for the nearby headquarters of Japan Tobacco International. These double-skin façades provide good thermal and acoustic performance, maximize light gain, and give architects great creative freedom. However, they require extreme technical precision in their construction and installation. The central cavity that separates the two sheets of glass is sealed with a silicone gasket, an elastomer that naturally releases gases depending on the temperature inside the cavity. The risk of condensation is very high. Maintenance is complicated and expensive, and damage over time is not uncommon.

IMPLENIA'S WARNINGS

On May 22, 2019, Implenia and its subcontractor, Felix, sound the alarm. They are the ones who have the mandate to manufacture the CCFs. After testing the drawings submitted by SOM, Implenia concludes that it will be difficult, if not impossible, to eliminate the condensation completely.

The two Implenia signatories send an ultimatum to SHP management, demanding that they be informed within seven days if the UN “intends to confirm its choice of CCFs or if it seeks another solution.”

A series of further letters to the UN Office in Geneva (UNOG) follow. Implenia does not want to be held responsible for what it considers to be a defect in the SOM’s architectural design for the façades and demands payment for the additional costs incurred in carrying out the tests. These costs run into millions.

THE UN IS CONCERNED

The concern can be read in internal UNOG memos obtained by the Geneva Observer. In June, David McCuaig, the director of the SHP project, brought the matter to the attention of Clemens Adams, the director of UNOG’s administrative division. Clemens was forced to acknowledge that the lack of clarity in the wording of the contracts denounced by the auditors was problematic. Adams recalls that Implenia has made extensive use of this imprecision, having submitted 17 claims that have led to a financial settlement.

David McCuaig questions Implenia’s assertions: He believes that the responsibility for finding a solution lies with the Swiss manufacturer and its subcontractor. But in the face of an escalating situation, he concedes that the UN “cannot expect SOM to provide us with an impartial analysis” of the issue. He asks for an independent expert opinion.

Site meetings continue. SHP is compelled to proceed cautiously with all agents in order, writes David McCuaig, “to reserve our rights and not compromise on the contractual obligations” of the companies working on the project. All scenarios must be considered, including the possibility of financial compensation to Implenia.

A VERY TURBULENT END TO 2019

Technical meetings to find a solution for the CCFs are held between SHP, SOM, and Implenia/Felix. A meeting on September 23 is entirely dedicated to the question of the façade.

Between its technical, financial, and legal aspects, the issue has become complex and sensitive, but while the SHP management is thinking internally and seeking outside advice, it is not responding to Implenia on the substance. Months pass. On November 27, 2019, the construction company sends a new angry letter to McCuaig.

In the letter, the Swiss company reiterates its assertion that “it is impossible to completely avoid the risk of condensation, especially given the expected life of the building.” At best, visible condensation appears to have been controlled, but the builder restates that it cannot be completely eliminated. It takes issue with the fact that SHP management questions the results of tests conducted with its subcontractor, Felix, claiming that they have been certified by independent experts. Implenia estimates the total amount of extra costs incurred at nearly 10 million francs.

A second letter dated November 29 containing a detailed analysis of the impact on the project schedule was uploaded to Primavera Web, the SHP project’s document management platform. According to Implenia, the project cannot move forward in light of “critical issues” on which SHP “has not made a contractual or operational decision.” The company also claims that its client, UNOG, reportedly agreed at the “September façade summit” to a reduced and invisible condensation in the CCFs that Felix would now be able to guarantee.

No procrastination this time in the SHP response sent on December 3: UNOG, writes David McCuaig, “has never accepted and does not accept any condensation risk. […] The idea that SHP would have accepted the start of production [of the CCFs] with such a risk is unfounded. [...] Implenia remains fully responsible for the proper execution of the contract on the design and construction of the façade elements.”

When contacted several times by the Geneva Observer, the people in charge of the SHP project at Implenia did not wish to express themselves directly and referred us to the company’s communications department. The latter directed us to UNOG in order to obtain answers to our questions.

THE CONDENSATION ISSUE  SUDDENLY DISSIPATES

However, a solution has apparently been found to the satisfaction of all parties between the end of last year and today. In an email from Rhéal LeBlanc, one of its spokespersons, UNOG states that “the condensation concerns have been resolved to the satisfaction of the UN. The fact that the façade is being installed means that the design with the CCF elements does meet the requirements of the contract and the UN.”

-PHM