Civmec has filed a statement of claim against Altura Mining’s lithium subsidiary, with the contractor alleging it is owed $4.5 million in compensation.
Civmec has filed a statement of claim against Altura Mining’s lithium subsidiary, with the contractor alleging it is owed $4.5 million in compensation.
The claim is in relation to works undertaken by Civmec at Altura Lithium Operations' Pilgangoora project in Western Australia, where Civmec had been tasked with building a lithium processing plant for $64 million in 2017.
The works are now complete, with the plant commissioned and operational in 2018.
Civmec said it had carried out works in addition to the plant’s construction, as well as experienced delays due to “Altura’s failure to fulfil its obligations under the contract, including as to engineering deliverables and the supply of free issue items”.
Henderson-based Civmec said, despite its efforts, the company had not secured its final payment from Altura.
“Civmec maintains that during negotiations which occurred in January 2019, Altura agreed to pay Civmec an amount of approximately $2.4 million excluding GST to settle Civmec’s outstanding claims,” the contractor said.
Civmec said Altura had requested the company consider taking equity in the form of shares in lieu of the settlement sum, which Civmec denied.
The contractor said it had issued a statutory demand for payment on Altura around 10 months after the processing plant was built.
Civmec said, at that time, Altura had claimed a payment amounting to $2.4 million to offset liquidated damages under the contract - a position Civmec says is incorrect and unfounded.
Civmec executive Pat Tallon said the company had offered Altura payment plans to assist them throughout "ongoing difficult financial circumstances".
"This is an extremely disappointing stance that Altura has forced us to take, particularly given the efforts made by Civmec throughout the project and continuing flexibility afforded to Altura," he said.
"To be publicly praised by Altura management for the works done at the plant's official opening and to be still awaiting payment two years later is unreasonable."
Civmec said it was confident of its position and that it did not consider the proceedings would have a material impact on the company's financial performance in fiscal 2021.
Altura today denied the assertion by Civmec, saying the contractor’s decision to begin legal proceedings was disappointing.
Subiaco-based Altura said Civmec had completed works under the contract some three months after the original scheduled date.
“As a result of the delay in reaching practical completion, Altura’s position is that liquidated damages of at least $2.35 million are payable by Civmec in accordance with the contract,” Altura said.
“Altura exercised its rights to offset the liquidated damages payable by Civmec against the certified outstanding amount payable and retention monies ($2.4 million in total) and has paid Civmec the balance including interest.
“Altura notes that the financial impact of the delays attributed to Civmec far exceeded the liquidated damages payable or the amounts that Civmec is now pursuing through legal proceedings.”
Altura said it was confident in its position and would “vigorously defend the proceedings”.
