Hamersley Iron Pty Ltd v Speno Rail Maintenance Australia Pty Ltd & Ors

The High Court of Australia considered an appeal from the Supreme Court of Western Australia concerning a dispute between Hamersley Iron Pty Ltd (Hamersley) and Speno Rail Maintenance Australia Pty Ltd (Speno). The core of the dispute involved a contract for the provision of rail grinding services, where Hamersley alleged that Speno had breached the contract by failing to perform the services with due diligence and in a proper and workmanlike manner. Hamersley sought damages for the alleged breach.

The central legal issues before the High Court were whether Speno had breached its contractual obligations to perform the rail grinding services with due diligence and in a proper and workmanlike manner, and if so, whether Hamersley had suffered loss as a result of that breach. The Court also had to consider the proper interpretation of the contractual terms relating to the standard of performance expected from Speno.

The High Court analysed the evidence and the terms of the contract, focusing on the implied term of due diligence and the express obligation to perform in a proper and workmanlike manner. The Court found that the evidence did not establish a breach of these obligations by Speno. It was held that the contractual requirements were met and that Hamersley had not demonstrated that Speno's performance fell below the required standard. The Court emphasised that the onus was on Hamersley to prove a breach and the resulting loss.

The High Court allowed the appeal, setting aside the orders of the Supreme Court of Western Australia. Hamersley's claim was dismissed.