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Maddocks builds Sri Lankan relationships

Maddocks builds Sri Lankan relationships

Maddocks has contributed to reconstruction efforts in post-tsunami Sri Lanka, assisting with a housing project near Galle in the island’s south-west, one of the areas worst hit by the disaster.…

Maddocks has contributed to reconstruction efforts in post-tsunami Sri Lanka, assisting with a housing project near Galle in the island’s south-west, one of the areas worst hit by the disaster. The firm provided pro bono legal services to the State Government of Victoria, through the Department of Premier & Cabinet, which was funding the project.

Maddocks advised on both the project structuring and the preparation of detailed project documents, which included a managing contractor agreement, independent certifier agreement and a partnership agreement with local charity the Foundation of Goodness. The charity will transfer the property titles for the houses to the villagers once they are completed.

Construction and major projects partner Josh Marchant said the project was not as large as some in terms of dollar value, but was huge in terms of motivational factors. While deals were often driven by clients cracking whips, he said there was a genuine motivation on this project to complete as quickly as possible. “You knew all these people were living in tents, and the quicker we could get the project moving, the quicker they could get into housing.”

He said the firm based its approach largely on that taken on projects funded by the World Bank. “There is a need to look at risk differently in post-tsunami projects because there is a massive shortage of labour and supplies — almost every tradesman in the Indian Ocean region is busy working on reconstruction projects.”

This meant the risk surrounding labour and materials was much higher than normal, so a more flexible approach than a lump sum delivery model had to be taken, because of the uncertainties in the local market.

Maddocks worked with Sri Lankan lawyers from the Colombo-based firm De Saram, who advised on the local legal issues, and Marchant said cultural differences added some unique aspects to the deal. While Australia is a document-based culture, the Sri Lankan stakeholders did not always operate in the same way. “So it was a matter of finding a good balance in getting documentation that people could work with.”

The project also required jurisdictional agreements as to whether the project would be governed by Australian or Sri Lankan law, he said.

The Victorian Government provided $3.2 million to fund the reconstruction of 84 houses and associated infrastructure, including a community centre and children’s playground, for villagers in Seenigama, near Galle. Construction started this month, and should be completed by the end of the year. The settlement will be known as Victoria Gardens.

“We have been able to facilitate delivery of an important project across national borders. Differences in law and cultural expectations, which could have otherwise derailed the project, have been accommodated to good effect,” Marchant said.

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