Shipping action struck out

Legal action by Dutch shipbuilder Schelde Marinebouw against the Government over the award of a $500 million contract for new Navy ships to a competitor has been struck out by the High Court.

The company had sought a judicial review alleging the Defence Ministry wrongly awarded Tenix the Project Protector contract and the tender process was "fatally flawed".

Schelde's New Zealand representative, Bill MacGregor, said the company's lawyers were studying the decision by Justice Warwick Gendall that ruled action might have been taken under the private law of contract but it was not a matter for judicial review.

He said it was too early to say what Schelde might do next.

The company had named the ministry as the first defendant and Tenix the second, and sought $50 million in damages and $5 million in costs.

Project Protector is a plan to build seven Navy vessels including a multi-role ship, two 85m offshore patrol vessels and four 55m inshore patrol ships.

Tenix expects to give work to other contractors.