Kodama case
The Kodama case is a payment controversy that involved the Ministry of Housing and Urban Development of Chile, led by Magdalena Matte, in 2011. The ministry had entered into a judicial agreement that authorized a significant payment of 17 billion Chilean pesos to the construction contractor "Consorcio de Construcciones Kodama Ltda." for construction works. However, these works were originally assessed to have a maximum value of 3 billion pesos by the Institute of Experimental and Materials Research at the University of Chile. Just as the payment transaction, which would have facilitated the construction of 15,000 Chilean social housing units, was about to take place, it was abruptly halted.
Background
The controversy had its roots in the construction works for Transantiago, a major public transport project in Santiago. Under the administration of Michelle Bachelet, the Ministry of Housing and Urban Development ordered the construction of a bus lane on "Avenida Pedro Aguirre Cerda" in November 2006. The project was initially budgeted at 25.5 billion pesos and was scheduled for completion in 2007. However, due to changes in the project, it was not finished until May 2010, 899 days later than planned.As a result of these changes, the construction contractor, Kodama Ltda., demanded 7 billion pesos from the ministry in 2009. However, the ministry valued the additional costs at only 950 million pesos, as stated in Resolution 134 on February 16, 2010, and communicated this to the General Comptroller's Office. Eight months later, under the administration of Sebastián Piñera, the Comptroller's Office rejected the payment transaction and authorized the payment of a significantly reduced amount, only 95 million pesos, on October 6, 2010.
Legal proceedings and settlement
On December 15, 2010, Kodama Ltda. filed a lawsuit against the Chilean state, claiming 41 billion pesos in compensation at the 10th Civil Court of Santiago. This amount was significantly higher, 493% more, than the initially demanded 7 billion.For reasons that remain unclear, on January 25, 2011, the Ministry of Housing and Urban Development, through Decree 8, authorized the payment of 17 billion pesos to the contractor Kodama Ltda. The contractor accepted this offer, and the agreement was signed in the 10th Civil Court of Santiago.