More contract legal battles at Roy Hill

A new legal fight has erupted at Roy Hill relating to failure to make payments.

Samsung C&T has reportedly faced court over issues relating to failure to make payment to Thai metal suppler Best Tech & Engineering (BTE), according to The West.

The court documents state BTE was contracted to supply around 15,000 tonnes of modular steel products for the iron ore mine and the Samsung refused to make contractually agreed payments, however Samsung claims that the company has breached agreements in their contract, allowing Samsung to seize a bank guarantee.

Samsung said there four major breaches of the contract, namely that BTE had failed to provide MDRs in accordance with the agreement or at all (costs were being estimated);that it had failed to comply with the contract schedules, causing Samsung loss and damage in respect of demurrage charges as previously set out, an amount of just over $2.79 million or as claimed in respect of that alleged breach; that BTE had failed to comply with the contract in respect of the supplied materials, which have required substantial defect rectification; and BTE had wrongfully purported to suspend the contract, and accordingly was in substantial breach of cl 25.2(b) of the contract.

 “In short, the plaintiff [BTE] considers that the defendant has failed to make payments which are due to it under the contract. The defendant [Samsung], on the other hand, has taken the view that the plaintiff has failed to comply with a number of its contractual obligations,” the court documents explain.

BTE has rejected this, and claiming that Samsung failed to make payments necessary under their contract.

This is not the first time Samsung C&T has faced court of issues such as these.

The company faced Laing O’Rourke in court over a decision to terminate a $215 million contract.

Laing O'Rourke had been in charge of the construction of structural steel and associated mechanical, piping, electrical and instrumentation works for the massive mine.

The contract also incorporated building the ore stockyard facilities to support the intermodal and export operations, comprising car dumpers, interconnection conveyors and transfer stations.

Roy Hill chief executive Barry Fitzgerald accused Laing O'Rourke of removing materials and equipment in breach of its contract and the termination agreement.

"Laing O'Rourke's motive for their actions has been questioned," Fitzgerald said.

"This win allows Samsung and its subcontractors to continue with construction works and maintain the schedule for delivery of this important project."

A spokesman for Laing O'Rourke denied the contractor took construction material from the site.

"Laing O'Rourke took delivery of materials at the direction of the court last week, with the judge ruling they be stored in a secure compound whilst Samsung's 'emergency relief' application was heard," he said.

According to the judgement, Laing O’Rourke claims it is owed about $39 million from Samsung, however the head contractor argues the sum is closer to $17 million.

Samsung has since handed Laing O’Rourke’s terminated contract to Queensland company Goodline, and is currently facing Laing in court on the matter.

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