Rio Tinto and Forge in court battle

Rio Tinto and collapsed engineering firm Forge Group are set to battle it out in court over monies owed.

Forge Group receivers are chasing Rio Tinto for $50 million it claims is owed in unpaid work.

It also wants the $100 million in bank bonds Rio called down just days after the collapse of the company.

However Rio says it “vigorously defends its entitlement to take the actions it has taken relating to the security bond issued to it by Forge", SMH reported.

"We also dispute claims that we have any outstanding payments for work completed by the Forge Group," Rio said.

Forge had five contracts with Rio subsidiary Hamersley Iron before it collapsed last February.

Rio pulled the contracts just days later and called down the $100 million in bank securities Forge put up when the contracts were first awarded.

It is understood the contracts were worth around $750 million in total.

Last year, an adjudicator ordered Rio Tinto to pay Forge for work at three iron ore projects – $2.1 million for Hope Downs 4 and $642,000 for West Angelas and Brockman.

Rio disputed the decision and asked for a review but this was refused by Supreme Court judge Andrew Beech.

Beech also agreed to enforce the payment so the $8.5 million balance of Rio's counterclaims could be resolved.

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