Offer to end Perth hospital feud rejected

A multi-million dollar legal stoush over the Perth Children's Hospital may go to court after the West Australian treasurer accused construction company John Holland of treating him "like a fool" and publicly leaking negotiations.

The $1.2 billion hospital opened in May last year - about three years late - after problems including asbestos in ceiling panels and lead in drinking water.

John Holland is seeking more than $300 million in damages from the WA government over contract variations, but the state has its own claim against the company over project completion delays.

Treasurer Ben Wyatt refused to confirm reports the Chinese-owned company had been offered a $20 million settlement.

He instead accused John Holland of using a "clear litigation tactic" of leaking information to the media to weaken the government's negotiating position.

"What I've found with John Holland (is) they have a well-used tactic with selective media leaks to try to get the state to somehow compromise its position - we won't be doing that," Mr Wyatt told reporters on Monday.

"My preferred outcome is a negotiated position and that appears to be more and more unlikely, but I'm not going to participate in this sort of selective media leaking around what may be a long and protracted litigation."

While the treasurer did not want to go to court, he said he would not be "treated like a fool by an organisation that wants me to write a big cheque".

He also agreed with the observation he was "pissed off".

"This is not the way professional organisations should be negotiating what is a sensitive and incredibly complicated dispute," Mr Wyatt said.

"I am disappointed that it's come to this."

Health minister Roger Cook said the state government would defend the rights and interests of the WA taxpayer.

Opposition leader Mike Nahan - treasurer during much of the hospital's construction - said the Labor government took possession of the hospital against the advice of the Health Department when there were "23 defects outstanding".

John Holland declined to comment.