Saaremaa Municipality is seeking €500,000 from construction company Merko Ehitus and design company Projekt Kuubis to cover repairs to Kuressaare's crumbling central square.
The municipality is taking the companies, which built and designed the area which cost over €4 million, to court. It was promised the work would last for 50 years but the paving stones started to break after two.
But Merko Ehitus said the damages sought are too high and significantly more than the original tender.
The dispute has been ongoing for more than a year.
"We filed a class action against both the designer and the builder to be reimbursed for the sums it will cost to repair it. The reimbursement we are claiming is over €500,000," council leader Mikk Tuisk told "Aktuaalne kaamera".
Merko has previously said there is no point in only repairing the area as it needs to be rebuilt with a stronger foundation and materials. The company does not believe it made an error during construction and thinks the municipality should pay for the new materials.
But Tuisk said the municipality has done nothing wrong either.
Peeter Laidma, director of Merko's Concrete and Utilities Construction Division, told AK the municipality's demands are "not justified".
"The municipality wants Merko Ehitus to build a significantly stronger solution, different from the original basic design at the time of procurement and at Merko's cost, which we do not agree with in principle," he said.
Editor: Merili Nael, Helen Wright
Source: Aktuaalne kaamera