Managing the Legal Environment: Case Study 2Multiplex and Wembley stadium. The basic facts and...

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Managing the Legal Environment: Case Study 2 Multiplex and Wembley stadium. The basic facts and account of the project and the issues that arose can be found at this location:...

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Managing the Legal Environment: Case Study 2
Multiplex and Wembley stadium.
The basic facts and account of the project and the issues that arose can be found at this location:
http://www.smh.com.au/news/Business/The-Multiplex-complex/2005/03/04/ XXXXXXXXXXhtml#
There is also other information available – and some will be loaded into moodle (although you can find other information on this case in a variety of locations).
Other facts relevant to the discussion and analysis.

The contract had Multiplex agreeing to take responsibility for construction of the stadium for a fixed maximum of £356m.
The project was 18 months overdue and massively over budget (est in excess of £900m).
Death, danger and damage caused additional delays and uncertainty.
Legal action was taken both by and against Multiplex – principally involving Mott MacDonald and Cleveland Bridge (but not only).
The contract included a penalty clause of £14000/day.
£120m in lottery funding was granted for the purpose.
A range of events and competitions (including the FA Cup final) – 12 in all - had to be relocated to other venues during 2006.

Questions:

What were the principal issues that arose from the contracts to which Multiplex was a party? How were these resolved (or not)?
What were the direct and indirect impacts for Multiplex of these issues and consequences?
How did Multiplex attempt to minimise these impacts? How successful were those attempts?
What procedures and safeguards could Multiplex have put into place to minimise or avoid the issues that arose?

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Answered Same Day Dec 26, 2021

Robert · Accepted Answer

1. What were the principal issues that arose from the contracts to which Multiplex was a 
party? How were these resolved (or not)? 
ANSWER 
The major issues
1
 related to Multiplex may be explained as follows- 
a. LEGAL ISSUES 
i. Cleveland Bridge ended their contract alleging that they were not being 
paid for the materials 
ii. Contract with Wembley2 delayed despite contract carrying huge penalties 
clause 
iii. Safety norms breached leading death of construction worker leading to 
cases under labor laws 
iv. Breach of Australian stock exchange information disclosure requirements 
b. ETHICAL ISSUES 
i. Multiplex never cared about the cost overruns and time overruns on the 
project 
ii. It Showed lack of corporate experience in its dealings with all 
stakeholders 
c. PROJECT MANAGEMENT ISSUES 
i. Instead of project management, there was mismanagement all around. The 
dispute handling was not considered a serious issue. 
                                                           
1
 Thomas, D. (2009). Lessons from the Wembley Litigation. Const. L. Int'l, 4, 28. 
2
 Bewsey, G. (2006). WEMBLEY STADIUM Can all the problems at Wembley be placed at the feet of 
Multiplex?. CONSTRUCTION MANAGER-ASCOT-, 12. 
ii. The management failed to resolve the issues with all stakeholders of the 
project 
d. SAFETY ISSUES 
i. In 2004, a platform collapsed leading to death of a construction worker. 
ii. In 2006,

Managing the Legal Environment: Case Study 2 Multiplex and Wembley stadium. The basic facts and account of the project and the issues that arose can be found at this location:...

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