appConfigEntityId

bodyType

customContents

entityId

entityUuid

isVideo

articlePageQuery

article

articleSchemaContent

content

hooksArticlePageAdvertisementConfigArticle

hooksArticlePageFloatingButtonConfigArticle

appConfig

filter

json

liveArticle

Mark Magnier

A New York court has awarded a Bahamas-based property-management company US$1.6 billion against China Construction America (CCA) in a long-running legal dispute over a massive tourism project in the former British colony, according to a decision released on Monday.
The case won by BML Properties Ltd involved a disagreement over Baha Mar, a 1,000-acre (404.7 hectare) project that included three hotels totalling some 2,200 rooms, more than 280 private residences, a 9,300-square-metre (100,104-square-foot) casino and a golf course designed by famed golfer Jack Nicklaus.
The project was ultimately placed in bankruptcy and later sold to its current owner, Chow Tai Fook Enterprises, a Hong Kong conglomerate.
A central question in the trial overseen by New York Supreme Court Justice Andrew Borrok was whether BML’s US$1.5 billion losses resulted from its excessive debt or from construction delays.

The Bahamas developer “more than met” its burden of proof that construction delays were to blame, the court ruled, with company representatives committing “at least four instances of fraud”.
The result, Borrok concluded, was that BML suffered damages amounting to its entire US$845 million investment. Once interest charges dating back to 2014 were added the judgment ballooned to US$1.6 billion.
“CCA Construction Inc. was neither the contractor for nor an investor in the Baha Mar project, and, like its co-defendants, it intends to appeal the court’s decision, which is deeply flawed under well-settled principles of New York law,” a spokesperson for the company said.
“The decision ignores indisputable evidence that BML Properties overborrowed, overspent and overextended itself and then drove the project into a wrongful, secret bankruptcy to eliminate its obligations at the expense of other stakeholders, including minority investor CSCEC Bahamas and construction manager CCA Bahamas, which made tireless efforts to complete the Baha Mar project on time and within budget,” the spokesman said.
CCA is an American subsidiary of state-owned China State Construction Engineering Corporation (CSCEC), the mainland’s largest construction group.
The Chinese embassy in Washington expressed hope that the companies would reach a settlement.
“The Chinese government has always required Chinese overseas companies [to] strictly comply with the laws and regulations of the host countries,” it said in a statement, adding: “we will also firmly protect Chinese companies and individual’s legitimate and lawful rights and interests.”
The court also found that board members of the Chinese construction company failed to take their responsibility seriously and were “hopelessly conflicted” given that the firm was secretly working to acquire a competing hotel.

According to court documents, China Construction purposely slowed down the Baha Mar project even as officials told BML that the project would open on schedule by March 27, 2015, “with the knowledge that if that date was missed it would be disastrous”.
At one point, China Construction asked BML for US$54 million to pay subcontractors that, the court found, was actually used to buy the competing British Colonial Hilton hotel in Nassau.
Baha Mar, meaning “shallow water”, was announced in 2010 with financing by the China Exim Bank, construction by CCA and 70 per cent of the labour brought in from the mainland.
Groundbreaking took place in 2011. Following the bankruptcy, Chow Tai Fook bought the project in December 2017.
“I first conceived of Baha Mar more than 20 years ago, only to see it ripped out of my hands at the brink of opening by CCA,” said Sarkis Izmirlian, chairman and CEO of Baha Mar’s original developer, in a statement on Monday.
Izmirlian said the case proved that China Construction secretly cut hundreds of workers from the project in the critical final months before the grand opening, and “diverted resources and key personnel to Panama to start a new project rather than finish Baha Mar”.

Court documents painted a picture of increasingly anxious CCA board member Ning Yuan asking for the firm’s parent company in Beijing to help as delays mounted before the 2015 opening, which would subject it to fines of US$250,000 a day for failing to meet the promised deadline.
The judge cited as evidence of fraud Yuan’s warning of “catastrophic losses” while the CCA board was reassuring BML that the project was on track.
“The production situation of the project is extremely severe, and if the situation cannot be fundamentally reversed, it will cause irreparable and catastrophic losses,” Yuan wrote.
The parent company should take “urgent measures immediately, quickly organise the dispatch of the additional labour force and dispatch skilled workers and experienced management personnel to the site for the final shock work,” Yuan added.
This, the CCA board member continued, would “ensure that the project’s scheduled target of full opening on March 27, 2015 can be achieved”.
Izmirlian on Monday voiced satisfaction over the ruling.
“We are grateful to have finally had our day in the US judicial system,” he said. “And we intend to proceed with the enforcement of the judgment in an equally thoughtful and prudent manner.”


Trump rejects Iran proposal for deal to reopen Hormuz

3 top reasons Trump will face a stronger Xi Jinping at November Apec forum in China

China-based Brics bank set for lead role in hunger alliance this year, Brazil says

Trade truce extension aside, was AI the real Xi-Trump summit breakthrough?

United States

US court awards Bahamas firm US$1.6 billion in case against China Construction America

CCA is an American subsidiary of state-owned China State Construction Engineering Corporation, the mainland’s largest construction group. Photo: Shutterstock

A screenshot from the Baha Mar website. The project included three hotels totalling some 2,200 rooms and more than 280 private residences.

The project was ultimately placed in bankruptcy and later sold to its current owner, Chow Tai Fook Enterprises, a Hong Kong conglomerate with holdings in jewellery as well as the property sector. Photo: May Tse

A screenshot of a page on the Baha Mar website. The project was scheduled to open in 2015

China goes all out to stabilise vital property sector: as it happened

Chinese Housing and Urban-Rural Development Minister Ni Hong leaves at the end of a press conference on the property sector in Beijing. Photo: Reuters

Housing and Urban-Rural Development media briefing. Photo: Ji Siqi

Will Chinese firm Gotion’s Michigan project help swing US election?

Illustration: Lau Ka-kuen

Signs against a proposed battery plant by Gotion High-Tech on a farm near where the company plans to build the facility. Photo: The Detroit News/TNS

US Reprepsentative Elissa Slotkin, the Democratic candidate for Michigan’s open US Senate seat, and former US Representative Mike Rogers, the Republican candidate, are seen at a debate. Photo: Detroit Free Press via AP

Meet the women changing the male-dominated construction industry in Hong Kong

The women changing the face of Hong Kong’s construction industry. Photo: Jocelyn Tam

Cranes stand at residential buildings under construction in the Tseung Kwan O district of Hong Kong. Photo: Bloomberg

Carpenter Yung Wing-yan, founder of MADE Furniture, in her workshop. Photo: Courtesy of Yung Wing-yan

Hong Kong is facing a shortage of skilled construction workers. Photo: Getty Images

Mable Lo Mei-bo, contractor and founder of Mega Concept Interior Design. Photo: Eugene Chan

Mable Lo, a contractor. Photo: Jocelyn Tam

Jinny Ko, a leveller, on a construction site. Photo: Courtesy of Jinny Ko

Jinny Ko, the leveller. Photo: Jocelyn Tam

Tan Ruijuan on a construction site. Photo: Courtesy of Tan Ruijuan

Tan Ruijuan set up her own company to provide contracting work in sand and cement. Photo: Courtesy of Tan Ruijuan

Bar bender Shi Weimin carries a bar at one of her construction sites. Photo: Courtesy of Shi Weimin

Bar bender Shi Weimin works on a project. Photo: Courtesy of Shi Weimin

Carpenter Yung Wing-yan, founder of MADE Furniture, among the tools of her trade. Photo: Courtesy of Yung Wing-yan

Yung Wing-yan works on the structure of a house. Photo: Courtesy of Yung Wing-yan

Carpenter Yung Wing-yan, founder of MADE Furniture. Photo: Jocelyn Tam

News

China

World

Americas

Knowledge

US-China Relations

New York judge’s ruling turned on whether losses in 1,000-acre tourism project stemmed from excessive debt or construction delays


New York judge’s ruling turned on whether losses in 1,000-acre tourism project stemmed from excessive debt or construction delays.


US court awards Bahamas firm US$1.6 billion in case against China Construction America

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}New York judge’s ruling turned on whether losses in 1,000-acre tourism project stemmed from excessive debt or construction delays

New York judge’s ruling turned on whether losses in 1,000-acre tourism project stemmed from excessive debt or construction delays