D&H Steel is suing Fletcher Construction for aiding and abetting Fair Trading Act breaches and breaking up a joint venture. 

While the Henderson-based steel firm had a joint venture with Culham Engineering, it says Fletcher encouraged Culham to work with foreign firm The Herrick Corporation, the owner of Thai Herrick, to bid on Fletcher contracts. 

Henderson-based D&H Steel filed proceedings in the High Court at Auckland in 2017, but the case is yet to get a public airing.

In fact, the details may never be made public as the parties remain tight-lipped, and are considering a settlement. Fletcher declined to comment while D&H Steel managing director Mike Sullivan said he could not talk but hoped to resolve the case. Culham’s Rob Kirwan did not respond to a request to discuss the matter.

Documents in the case viewed by BusinessDesk show D&H Steel had a joint-venture agreement with Culham to together bid on upcoming New Zealand construction projects.

D&H Steel claims that unbeknownst to it, Fletcher introduced Culham to Herrick and then they made bids on two construction projects, which Fletcher accepted.

The company alleged Culham breached its joint-venture agreement by teaming up with Herrick and said its misleading and deceptive conduct was a breach of the Fair Trading Act.

It says Fletcher induced Culham to do this, and so the NZX-listed firm and Herrick were aiding and abetting the Fair Trading Act breaches.

It is not explicit in the court documents which two construction projects the case relates to.

Big projects

The two major Fletcher projects Culham Engineering and Herrick are working on under the joint-venture entity, CH Steel, are SkyCity’s International Convention Centre and Precinct Properties’ Commercial Bay.

The appointment of CH Steel to the International Convention Centre job made headlines in June 2016 as unions said the work should go to a local fabricator. D&H Steel’s Sullivan told TVNZ at the time he was “pretty gutted for the industry” that the contract went to a partly foreign joint venture.  

The CH Steel job for Auckland skyscraper Commercial Bay involves 8,500 tonnes of structural steel for the 39-storey office tower, which was announced in 2015 and is expected to be completed next month.

Herrick had also been joined as defendant to the suit but the US company was removed from the proceeding in 2018.

Through Thai Herrick, the San Francisco-headquartered firm has several other projects in New Zealand including Christchurch’s Convention Centre, with Cimic’s construction arm, CPB, as well as Fisher & Paykel’s Building 4 in East Tamaki, Auckland, with RCP. It also lists Scentre Group’s Westfield Newmarket expansion in Auckland among current jobs.

Court silent

BusinessDesk sought more information from the courts on the proceeding but Justice Matthew Muir ruled on May 21 that it was too early in the dispute to release more information. Fletcher argued that D&H Steel's pleadings showed an "undeniably lopsided view of the case and arguably a somewhat sensationalised view." 

"There is always an element of unfairness in reports based on allegations in a statement of claim which has not yet been tested by sworn evidence. In the present case that risk is augmented by the particular form of the plaintiffs’ pleading," the judge ruled. 

If the case makes it to trial it will proceed in May next year. 

Other recent disputes for the listed builder and materials firm include a spat with Commercial Bay subcontractor Spotless, which is yet to go to trial, and a dispute with one of the subcontractors on the Christchurch Justice Precinct, Electrix. In that case, Fletcher has been told to pay $7.45 million to the electrical subcontractor.