Spanish contractor Duro Felguera has won a legal battle with Samsung C&T over the jurisdiction of a contractual dispute for work on the $10 billion Roy Hill project, with the next stage to play out infront of Singaporean arbitrators.
Spanish contractor Duro Felguera has won a legal battle with Samsung C&T over the jurisdiction of a contractual dispute for work on the $10 billion Roy Hill project, with the next stage to play out infront of Singaporean arbitrators.
Duro is claiming almost $60 million for performance of works at the operation and a declaration against potential damages and rectification costs sort by Samsung.
It is a complicated dispute, however, and one of a series that have sprung out of construction of Roy Hill, including between Samsung and NRW Holdings over a rail line, and Duro and FLSmidth over cone ore crushers.
Samsung’s original works contract, building a processing plant, had been a joint venture between Duro and Forge Group, which was later replaced by a term sheet between Duro and Samsung after the collapse of Forge.
That term sheet had overruled parts of the previous contract, although some of the clauses, including for arbitration jurisdiction, referred to the previous contract.
Samsung argued, however, that jurisdiction was derived from a different part of the term sheet and as such, the dispute should be heard in the Supreme Court.
In April, Samsung seized a $68 million bond from Duro after a ruling went its way.
Today, Supreme Court Justice Rene Le Miere said the proceeding should be referred to arbitration.
“In substance the matter in controversy in this proceeding is whether the Duro claims are within the jurisdiction of the arbitral tribunal to which disputes under the arbitration agreement are to be referred,” Justice Le Miere said in the judgement.
“The answer is that they are.
“This proceeding involves the determination of a matter that, in pursuance of the arbitration agreement in the interim subcontract, is capable of settlement by arbitration.”
Duro operations director Raul Serrano said welcomed the decision.
"The matter before the court was in relation to where certain aspects of the dispute should be heard, with Duro arguing that as per its sub contract with Samsung, the dispute should be heard entirely by arbitrators," the spokesperson said.
"Samsung was seeking to have parts of the dispute heard in the Supreme Court of Western Australia.
"Justice Rene Le Miere today ruled in Duro’s favour, which means that the dispute between Duro and Samsung will now proceed to be heard in substance by arbitrators.
"Duro says that it is owed well in excess of $100 million by Samsung in relation to a $500 million sub contract for work on Roy Hill."
Yesterday, another claiminvolving Duro, with FLSmidth as plaintiff, was dismissed by Supreme Court Justice Tottle.
