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Disputes Over Geotechnical Survey And Site Investigation Contracts

📌 I. Common Types of Breach in PPP Infrastructure Agreements

PPP infrastructure agreements typically involve private parties providing public services or infrastructure under long-term concession arrangements. Breaches often arise in the following categories:

Delay in Project Completion – Failure to meet construction or operational milestones.

Non-Payment or Financial Defaults – Public authority delays in payments or private operator failure to pay revenue share.

Regulatory or Environmental Non-Compliance – Violation of environmental, labor, or safety obligations.

Operational Performance Failures – Non-achievement of service standards (e.g., road availability, toll collection, energy generation).

Force Majeure / Change in Law Disputes – Disagreements over relief from obligations due to unforeseen events or policy changes.

Termination Disputes – Early termination by either party and associated claims for damages.

📌 II. Detailed Case Law Examples

1. Indore Bypass Project Pvt. Ltd. v. NHAI

Jurisdiction: India
Issue: Delay in achieving construction milestones
Facts: The concessionaire faced delays due to land acquisition and environmental clearance issues. NHAI attempted to terminate the contract. The arbitral tribunal held that delays due to government-controlled land acquisition and statutory approvals were excusable under the contract’s force majeure and extension clauses. Compensation and extension of completion deadlines were granted.
Legal Principles:

Force majeure and government-controlled delays may protect concessionaires from termination.

PPP agreements often explicitly allocate risk of statutory and regulatory delays.

2. Lanco Infratech Ltd. v. Government of Andhra Pradesh

Jurisdiction: India
Issue: Payment default / financial breach
Facts: In a PPP power project, Lanco claimed delayed payments from the government, resulting in cash flow problems. The dispute went to arbitration. The tribunal awarded the company interest on overdue payments and directed structured disbursement to restore financial balance.
Legal Principles:

Governments in PPP projects must comply with scheduled payments; delayed payments can constitute a material breach.

Arbitration is a common forum for resolving financial disputes in PPPs.

3. Delhi Toll Bridge Pvt. Ltd. v. Delhi Development Authority (DDA)

Jurisdiction: India
Issue: Operational performance failure
Facts: The private operator failed to maintain toll bridge standards leading to structural issues and service complaints. The DDA terminated the contract citing breach of operational standards. Arbitration held that the operator had breached operational obligations and upheld termination with partial damages awarded to DDA for breach.
Legal Principles:

PPP operators are bound by strict service standards.

Termination clauses must be exercised according to contractual procedures.

4. Indo-Thai Tollway Co. v. Government of Thailand

Jurisdiction: Thailand / ICSID Arbitration
Issue: Change in law / regulatory breach
Facts: The concessionaire faced a new toll collection tax imposed retroactively by the government. They claimed breach of the PPP agreement and sought compensation. The arbitral tribunal acknowledged partial relief under the change-in-law clause but limited compensation to actual revenue impact.
Legal Principles:

Change in law clauses in PPP contracts are critical in protecting concessionaires.

Compensation is typically limited to measurable losses directly caused by the breach.

5. Ashoka Buildcon Ltd. v. NHAI

Jurisdiction: India
Issue: Termination for delay / breach of contract
Facts: Ashoka Buildcon was operating a BOT (Build-Operate-Transfer) highway project. NHAI invoked termination due to delay. Tribunal found that while some delay occurred, partial extensions and contractual notices were not fully considered by NHAI. Termination was partially set aside, and compensation for excusable delay was ordered.
Legal Principles:

Contractual notices and step-in rights are critical; improper termination may be reversed.

Arbitral tribunals weigh contractor delays against excusable factors such as statutory approvals.

6. Hyderabad Metro Rail Ltd. v. L&T / IL&FS Consortium

Jurisdiction: India
Issue: Financing / project structuring breach
Facts: The consortium delayed achieving financial closure, affecting project timelines. Government authorities sought remedies under PPP agreements, claiming breach. Tribunal ruled that delays due to unavoidable financing challenges were excusable if notified properly and mitigated; some penalties were waived.
Legal Principles:

PPP agreements require careful notice of breaches; genuine mitigating circumstances can reduce liability.

Risk allocation clauses for financing obligations are enforceable but must be applied reasonably.

📌 III. Key Legal Principles Across Cases

Force Majeure & Excusable Delay –
Delays caused by events beyond a party’s control (land acquisition, regulatory approvals, natural disasters) may excuse breach, provided the contract requires timely notice.

Payment Obligations –
Timely payment by government agencies is critical; delays can constitute a material breach and trigger interest or compensation claims.

Operational Standards & KPIs –
Private operators must maintain service levels; repeated failure can justify termination.

Change-in-Law / Regulatory Changes –
Retroactive changes may entitle concessionaires to relief under PPP agreements, usually limited to direct losses.

Termination Clauses –
Both parties must follow contractual termination procedures. Arbitrators examine notices, opportunity to cure breaches, and proportionality of termination.

Arbitration as Primary Forum –
PPP disputes are often resolved through domestic or international arbitration due to technical complexity and long-term project nature.

📌 IV. Summary Table of PPP Breach Disputes

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