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Brisbane City Council serves TechnologyOne $50M+ damages claim

Brisbane City Council serves TechnologyOne $50M+ damages claim

'Ambit claim' follows termination of contract on Friday

TechnologyOne has received a claim for damages in excess of $50 million from Brisbane City Council (BCC).

The software vendor said it strongly disputes and will vigorously defend what it referred to as an ‘ambit claim’.

The claim follows an announcement by BCC on Friday that it would be terminating its 2015 contract for TechnologyOne to replace 13 of the council’s core IT systems. TechnologyOne last week said it be making a counterclaim for an amount in excess of $50 million for wrongful termination.

It is the latest in a long-running and bitter dispute between the two parties that has played out in the public arena.

At the beginning of the year Brisbane Lord Mayor Graham Quirk blasted the company, announcing the work could end up 18 months behind schedule and $60 million more expensive than anticipated.

In response, the Brisbane-headquartered software company said the council was to blame for poorly defined business processes leading to a significant increase in the project’s scope.

The matter will now head to arbitration. TechnologyOne said it remained confident of its legal position and emphasised the fact it has “total and comprehensive insurance cover for all its projects”.

Bewildering

There has been no love lost between the two parties, with both sides claiming the other is not being honest about why the relationship has broken down.

“In the past six months, Council offered TechnologyOne the opportunity to reform the contract and met with their representatives on many occasions to assist the company to get the project back on track. TechnologyOne has for a number of months been making public claims that in Council’s view are misleading and inaccurate,” Brisbane Lord Mayor Graham Quirk said in a statement following the council’s decision to terminate the contract on Friday.

The lord mayor said that TechnologyOne had not previously worked with a local government the size of Brisbane and had “struggled with the complexity of council’s operations”.

In response, TechnologyOne executive chairman Adrian Di Marco said the mayor’s choice to take the dispute public was bewildering.

“This matter should never have been put in the public arena by the Lord Mayor. BCC should have first followed the remedial processes allowed for in the contract away from the public spotlight... The Lord Mayor’s public announcement in January put both organisations on a collision course...TechnologyOne was at the time caught by surprise by the Lord Mayor’s announcement and remains bewildered and disappointed by his actions,” Di Marco said.

“Projects at times have problems, and in my 30 years in business, when this happens people get in a room to discuss it and find a commercial resolution. People do not go public until all avenues have been exhausted, especially if they have not previously raised a problem, let alone attempted to resolve the matter.”

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Tags disputeinsurancerisk managementdamagesBrisbane City CouncillosslawsuitcontractTechnologyOne

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