Italian-Thai Joint Venture Liable for Rebuilding Collapsed SAI Building, Says Prosecutor

[dinsdale]

China Railway Number 10 Engineering Group Company is a 49% shareholder. Indeed at 49% it's the overall majority shareholder.

[Ralf001]

14 minutes ago, Thingamabob said:

I wonder he ever really spent much, if any, time inside....

 

doubt it.

[The Old Bull]

On 3/30/2025 at 4:28 AM, flyingtlger said:

I have a feeling the company will just declare bankruptcy and walk away.....

Can't go belly up till they move assets from the company unless they formed a company specifically for that project.

[Drumbuie]

https://www.bangkokpost.com/business/general/2758639/italian-thai-development-faces-b108bn-debt-crunch-as-overseas-projects-fail

 

ItalThai is already in financial difficulties. The Chinese company is the same one whose tunnel collapsed in Nakhon Ratchasima, suffocating workers: their expertise is in tracklaying, not building high rises nor, apparently, tunnels. 

 

But their bid was the lowest. The whole thing stinks to high heaven. 

 

 

[john smith]

As of September last year the company declared liabilities of 100 billion baht including bonds. Payments to contractors were delayed. The company has lost money every year since 2020. TRIS credit rating is BB-

[jesimps]

On 3/30/2025 at 8:13 AM, Hawaiian said:

It is.  But the argument might go like this.  If it were designed properly it would have withstood the earthquake.  The question is who would buy that argument.

Earthquake? That was a mere shiver and any properly designed and constructed building should not have gone down. Someone should get bounced for that.

[Rampant Rabbit]

On 3/30/2025 at 9:16 AM, steven100 said:

and that's what I said in an earlier post ... 

 

this is Thailand,  and they will play the delay game. 

yeah I dont read every post as the forums become rather pathetic over the years

[ronnie50]

On 3/30/2025 at 3:26 AM, Georgealbert said:

Under Clause 11, Paragraph 2 of the standard construction contract, if the collapse occurred due to the contractor’s fault or an unforeseen event such as an earthquake, but before the final handover, the contractor is obliged to rebuild the structure at their own expense. The contractor cannot claim additional payment from the SAI unless the collapse resulted from the employer’s fault.

[...]

Regarding injuries and fatalities, Clause 12, Paragraph 3 of the contract requires the contractor to provide insurance coverage for all workers. Meanwhile, Clause 11, Paragraph 1 holds the contractor accountable for any accidents, damages, or hazards arising from their operations.

 

As a result, injured workers or the families of those who died will receive compensation from the contractor’s insurance policy and other legal entitlements. For third parties affected by the collapse, the contractor is fully liable for damages.

 

Two immediate things jump out here.

 

First, will the joint-contractor claim it's their 'employer's' fault' (effectively officials of the RTG), and accuse them in court of pressuring it into using sub-standard materials and changing building support specs for kickbacks? I'm not suggesting that happened and it would be a risky move for both Ital-Thai and Chinese government.

 

Second, it will be interesting to find out who insured this project. Usually a standard exemption clause in many insurance policies is earthquakes and other 'acts of God'. I wonder if the RTG as owner or 'employer' is self-insured? For big projects that usually makes sense rather than paying public funds to a third-party private insurer. Remember the 'red shirts' accused of damaging Central World and who the insurer turned out to be? (though underwritten by foreigners - smart move).

[Hawaiian]

46 minutes ago, jesimps said:

Earthquake? That was a mere shiver and any properly designed and constructed building should not have gone down. Someone should get bounced for that.

I've experienced many earthquakes in my lifetime including a 7.1 and a 7.5.  Videos taken during the quake in Bangkok definitely indicate more than a shiver.

[Ralf001]

46 minutes ago, ronnie50 said:

Two immediate things jump out here.

 

First, will the joint-contractor claim it's their 'employer's' fault' (effectively officials of the RTG), and accuse them in court of pressuring it into using sub-standard materials and changing building support specs for kickbacks? I'm not suggesting that happened and it would be a risky move for both Ital-Thai and Chinese government.

 

Second, it will be interesting to find out who insured this project. Usually a standard exemption clause in many insurance policies is earthquakes and other 'acts of God'. I wonder if the RTG as owner or 'employer' is self-insured? For big projects that usually makes sense rather than paying public funds to a third-party private insurer. Remember the 'red shirts' accused of damaging Central World and who the insurer turned out to be? (though underwritten by foreigners - smart move).

 

Could the joint contractor point the finger at the supervising company PKW joint venture?

[ronnie50]

3 minutes ago, Ralf001 said:

 

Could the joint contractor point the finger at the supervising company PKW joint venture?

Not according to the article - but who knows?

 

'Furthermore, Clause 13 stipulates that the contractor cannot evade responsibility by citing the presence of an inspection committee or project supervisors. In this case, the construction was overseen by the PKW Joint Venture as the project supervisor.'

[rickudon]

Apparently constructional steel was taken away for testing from the wreckage, suspected to be inferior? New building regulations came into force in about 2009 which meant that new buildings need to meet earthquake standards - older buildings do not.

 

The fact it was the only high-rise building to collapse does suggest failure to meet construction standards, The blame game now starts.

[Etaoin Shrdlu]

1 hour ago, ronnie50 said:

 

 

Second, it will be interesting to find out who insured this project. Usually a standard exemption clause in many insurance policies is earthquakes and other 'acts of God'. I wonder if the RTG as owner or 'employer' is self-insured? For big projects that usually makes sense rather than paying public funds to a third-party private insurer. Remember the 'red shirts' accused of damaging Central World and who the insurer turned out to be? (though underwritten by foreigners - smart move).

 

A normal contractor's "all-risks" insurance policy would insure against the peril of earthquake. So-called "acts of God", such as earthquake, windstorm, flood and wildfire, are insurable perils in most places, including Bangkok.

 

It appears that the project is insured under a contractor's "all-risks" policy jointly underwritten by Dhipaya Insurance (40%), Bangkok Insurance (25%), Indara Insurance (25%) and Viriyah Insurance (10%). It will almost certainly include cover for the peril of earthquake. 

 

One report has stated that the building was 50% complete and another says 30%. The loss may well exceed 1 billion baht.

 

Dhipaya's major shareholders are Government Savings Bank, Krung Thai Bank and the Petroleum Authority of Thailand. It has been reported that Dhipaya has reinsured 95% of the risk under the CAR policy, most of it probably with professional reinsurers offshore. The other insurers have probably reinsured major portions as well.

 

Dhipaya is frequently the insurer for projects that involve the Thai government. Bangkok insurance is one of the largest insurers in the country. Viriyah is most known for its market share in the auto insurance sector. 

 

The four insurers are working with the OIC to investigate this loss.

[TallGuyJohninBKK]

3 hours ago, Drumbuie said:

https://www.bangkokpost.com/business/general/2758639/italian-thai-development-faces-b108bn-debt-crunch-as-overseas-projects-fail

 

ItalThai is already in financial difficulties. The Chinese company is the same one whose tunnel collapsed in Nakhon Ratchasima, suffocating workers: their expertise is in tracklaying, not building high rises nor, apparently, tunnels. 

 

But their bid was the lowest. The whole thing stinks to high heaven. 

 

 

 

AFAIK, IT also is a main contractor on the Rama II Road project, which has been plagued by a long series of problems, including collapses of parts of their elevated roadway structures there.

 

Great team together! 

 

Five killed, 22 injured in beam collapse on Rama II Road

 

15 Mar 2025

At least five people were killed and 22 others injured when a concrete beam of an under-construction expressway bridge near Rama II Road in Chom Thong district of Bangkok fell early on Saturday.
...

Local media quoted Exat governor Surachet Laophulsuk as saying the agency would pursue legal action against the ITD-VCB joint venture, which was awarded the third contract for the Rama III-Dao Khanong-Western Outer Ring Road expressway project. The joint venture consists of Italian-Thai Development Plc and Vijitphan Construction.

...

Previous construction accidents on Rama II Road have resulted in fatalities. One of the accidents took place on Nov 29 last year when a sling broke, resulting in six deaths and eight injuries. Another accident took place on Jan 18 last year when a sling snapped, killing a worker and causing the crane’s lifting basket to fall. In May 2023, a worker was killed by a falling concrete slab.
 

https://www.bangkokpost.com/thailand/general/2980458/five-killed-22-injured-in-beam-collapse-on-rama-ii-road

 

But hey, the gravy train just keeps on rolling!

 

 

[thailand49]

Because it is spread out over the world if one lives or understand the leaders of this country it will slowly made to go away.

The way it went down so easily none of us are experts but it smells of corruption in general with corners cut passing of brown envelopes all around. 

The cover up will be the government smoke and mirror prevent loss of face embrassessment to the nation image they will somehow funnel money to the builder to get it rebuilt when that happens brag about the success so tourist will keep on coming and continue their saying 

" Land of Smile " truth is those who have suffer will get nothing.

If the collaspe of the twin towers 9/11, aftermath is the cancer cause from the smoke and dust money wise just as great in cost of rebuilding videos I see nothing of rescue worker covering up.

 

[PETERTHEEATER]

On 3/30/2025 at 2:27 AM, connda said:

The builder's will claim Force Majeure.  If that doesn't work - bankruptcy.  Fyi.  Sometimes the lowest bid isn't the best course of action.  I seriously doubt that the Italian/Thai partnership will be rebuilding that structure.  The deepest pockets will end up covering the cost (hello Thai government)!  🇹🇭

The Force Majeure is a clause which usually appears in contracts and insurance policies but, if, as the expert explains it specifically includes earthquake damage and ItalThai signed up to that they are liable.

[ExpatOilWorker]

1 hour ago, TallGuyJohninBKK said:

 

AFAIK, IT also is a main contractor on the Rama II Road project, which has been plagued by a long series of problems, including collapses of parts of their elevated roadway structures there.

 

Great team together! 

 

Five killed, 22 injured in beam collapse on Rama II Road

 

15 Mar 2025

At least five people were killed and 22 others injured when a concrete beam of an under-construction expressway bridge near Rama II Road in Chom Thong district of Bangkok fell early on Saturday.
...

Local media quoted Exat governor Surachet Laophulsuk as saying the agency would pursue legal action against the ITD-VCB joint venture, which was awarded the third contract for the Rama III-Dao Khanong-Western Outer Ring Road expressway project. The joint venture consists of Italian-Thai Development Plc and Vijitphan Construction.

...

Previous construction accidents on Rama II Road have resulted in fatalities. One of the accidents took place on Nov 29 last year when a sling broke, resulting in six deaths and eight injuries. Another accident took place on Jan 18 last year when a sling snapped, killing a worker and causing the crane’s lifting basket to fall. In May 2023, a worker was killed by a falling concrete slab.
 

https://www.bangkokpost.com/thailand/general/2980458/five-killed-22-injured-in-beam-collapse-on-rama-ii-road

 

But hey, the gravy train just keeps on rolling!

 

 

 

[Hardcastle P]

On 3/30/2025 at 7:47 AM, JoePai said:

if the collapse occurred due to the contractor’s fault or an unforeseen event such as an earthquake

 

Do you not think this is a salient point ???

But the thing should have been built to withstand an earthquake so no excuse. Was it designed to withstand an earthquake is more to the point that could bring in a 3rd party and rely cold up the enquiry, my money is on the latter.

[LeRoux]

On 3/30/2025 at 3:00 AM, steven100 said:

TIT ....   anything is possible,  even if they are requested to rebuild it at their cost,  they will just appeal, delay,  not build,  build a little ....  and it'll drag on and on for years.

 

and another possibility, is someone gets a nice fat envelope and they win the case and walk.  

 

and the corruption just goes around and around again ....   Lol

Which will come first, Insolvency?

Or Cleaning Up The Pile Of Rubble?

Insured Laborers? That will be interesting to see.

[Negita43]

I do not know the processes rquired in Thailand during a major construction project but surely at several stages someone must have signed a paper saying "at this point everything is OK" (ie design, foundation  etc) These people need arresting for their own protection because if corruption is suspected they are surely "loose end" targets.