A court in Odesa terminated a 148-million contract for the restoration of a hospital

The Odesa City Council terminated, through the courts, a 148.6 million hryvnia contract for the restoration of the Valikhovsky Wing of the Infectious Diseases Hospital. The work was halted due to violations identified by the State Audit Service during the procurement process.

This is stated in the decision of the Commercial Court of Odesa Oblast. 

The City Council’s Capital Construction Department filed the lawsuit against the contractor—the AVIS Consortium. Representatives of the defendant did not appear at the court hearings and did not submit any written objections. The court terminated the contract and ordered the contractor to pay court fees.

According to the court case file, the agreement for repair and restoration work on the Valikhovsky wing of the City Clinical Infectious Diseases Hospital was signed in late 2024. The project was to be financed with funds from the European Investment Bank. As noted in the ruling, during its monitoring of the procurement process, the State Audit Service identified violations of the law and ordered the contracting authority to terminate its obligations under the contract.

City officials tried for a long time to challenge this conclusion in court but lost the cases at all levels of jurisdiction. Afterward, the Odesa City Council offered the contractor to terminate the contract by mutual agreement, but the firm refused, citing that such actions were premature. By that point, the contractor had already completed part of the work and received payment totaling 12.3 million hryvnias.

Subsequently, as noted in the court case, the city council filed a lawsuit to seek the compulsory termination of the contract. The court fully granted the claims, as the agreement itself contained a clause providing for its mandatory termination in the event of a valid conclusion from the State Audit Service.

Юлія Калабайда