Settlement of the dispute between the geological company and the General Directorate for National Roads and Motorways for payment of remuneration for the exploratory wells made

Experience / 29.04.2024

The law firm’s advocates and attorneys successfully concluded another dispute in which they represented companies operating in the geological works industry.

The case involved claims against the General Directorate for National Roads and Highways (GDNRH) for remuneration for the drilling of exploratory wells necessary to determine geological and engineering conditions in an area intended for expressway construction.

This was another case in which the issue of how to account for exploratory wells  drilled partly in soil and partly in rock (within a single exploratory well) remained contentious between geological contractors and the GDNRH.

The geological contractors took the position that such an exploratory well should be classified as a whole, i.e., either as a ground or as a rock well, and be billed in its entirety at the rates provided for that type of well. On the other hand, according to the GDNRH, where both soil and rock were present within a single exploratory well, it remained reasonable to divide the exploratory well into shorter sections and to apply a different unit price for drilling 1 running meter, depending on the substrate.

Despite the fact that against the background of an analogous issue there was a final precedent judgment in 2022, in which the Court shared the legitimacy of the arguments of the advocates and attorneys of the law firms representing two geological companies in the case, and thus found that the method adopted by the law firm for settling remuneration for the drilling of exploratory wells was not supported by the provisions of the contract, the law firm did not change its position. In view of this, the contractors were forced to take another case to court.

However, in the course of the case, the parties entered into talks aimed at settling the dispute amicably, in which the lawyers of the law firm actively supported the Clients. These talks finally ended successfully and a settlement was worked out on favourable terms for the Clients.

Thanks to our experience and involvement in the case, Clients will soon receive a satisfactory amount of remuneration from GDNRH, without having to invest time and costs in another years-long litigation.