Legal action is being taken after a seawall collapsed last year and flooded an iron mine on Koolan Island.

Mining company Mount Gibson along with some subsidiaries is suing engineering firm GHD, arguing that they were responsible for the seawall collapse.

It relates to an event in 2014, when the main pit of the Koolan Island hematite operation was flooded after a pit wall collapsed.

Initial reports suggested the wall has some instability, which when combined with a high tide caused the section of the pit wall to give way.

The collapsed seawall allowed the main pit to be flooded, which led to a decision to shut down the mine, leaving around 200 workers without jobs.

Lawyers for Mount Gibson say the engineering company had been contracted to provide design, construction, maintenance and rectification of the infrastructure and associated structures.

The miner has reportedly lodged a writ against the engineer over the seawall failure.

The engineering company does not appear to have issued a statement on the issue.