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BHP Steel v ABB Engineering Construction - Doyles Arbitration Lawyers
BHP Steel v ABB Engineering Construction

BHP Steel v ABB Engineering Construction

BHP STEEL (RP) PTY LTD V ABB ENGINEERING CONSTRUCTION PTY LTD [2001] WASC 73

Supreme Court of WA – 20 March 2001

FACTS

BHP DRI was constructing a plant at Port Hedland and ABB was a head contractor for part of the works at the plant.

Monaveen was ABB’s subcontractor and it proposed to purchase the steel it needed to complete the works from BHP Steel.

Both BHP DRI and BHP Steel were part of the BHP group of companies and BHP DRI wanted BHP Steel to supply Monaveen with the necessary steel. However BHP Steel had concerns about extending credit to Monaveen to allow it to purchase the necessary steel and it therefore had discussions with ABB about some security being provided to assure BHP

Steel that it would be paid for steel supplied to Monaveen. While these negotiations were conducted BHP Steel supplied some steel to Monaveen. Eventually Monaveen became insolvent after the subcontract was terminated and $266,922.00 remained owing to BHP Steel.

BHP Steel issued proceedings against ABB claiming breach of contract, misleading and deceptive conduct, estoppel andnegligence and alleged that ABB had promised that it would pay BHP Steel for the steel if Monaveen did not pay for  the supplied steel.

ISSUES

Had there been a contract between BHP Steel and ABB with ABB promising to pay BHP Steel if Monaveen did not pay for steel supplied by BHP Steel?

Had there been representations made by ABB that it would pay BHP Steel any outstanding balance if Monaveen did not pay or all the steel supplied?

FINDING

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