This was published 7 years ago
Technology One has 28 days to explain why council should not cancel contract
By Ruth McCosker
A technology company involved in a bitter contractual dispute with Brisbane City Council has accused the council of making incorrect information public.
Technology One and the council have been battling over the renegotiation of a $122 million, 10-year contract to replace 13 systems with a new "local government systems project (LGS)" for more than three months.
Brisbane City Council has been accused of having incorrect information relating to a $60 million IT contract blowout.Credit: Glenn Hunt
Lord Mayor Graham Quirk revealed in January the renegotiation of the contract could have a cost blow-out of about $60 million.
On Tuesday, the council issued the Brisbane-based company with a Notice to Show Cause.
Technology One executive chairman Adrian di Marco has said Brisbane City Council was given incorrect information about the local government systems projectCredit: Tertius Pickard
Technology One has 28 days to respond to why the council should not terminate the contract.
A council spokesman said the notice to show cause related to the failure of Technology One to remedy a range of breaches identified in a Notice to Remedy Breach issued on February 10 (with a required remedy by March 13).
"Council had already extended the rectification period until April 30. Council also last week (April 27) issued a second Notice to Remedy Breach," the spokesman said.
"Breaches include failure to meet key milestones and deliverables as specified in the contract and council believes that Technology One has proceeded at a rate of progress so as to endanger the due and proper completion of the contract.
"As this is a legal matter between the two parties, no further details can be provided at this stage."
On Wednesday Technology One executive chairman Adrian Di Marco said when the Lord Mayor made his statement on January 25 the project was not in trouble.
"The Lord Mayor has been given incorrect information," Mr Di Marco said.
"Until the Lord Mayor's statement there was no contractual dispute and all parties were working and progressing to the agreed contracted 'go live date' of January 2018."
Technology One's statement outlined a chronological version of events leading to the dispute:
June 30, 2015 - Brisbane City Council awarded contract for the LGS project to Technology One with a go live date of March 30, 2017.
September 7, 2016 - The council requested substantially more software functionality than product originally contracted and both parties agreed to alter the original go live date to January, 2018 - both parties agreed to bear their own respective additional costs
November 29, 2016 - The council initiated an independent review of the project by external parties
January 9, 2017 - Technology One notified the council the increase in the scope of work requested was not provided for in the contract and the variation cost was about $3.6 million. Technology One awaited the council's decision on whether they wanted to proceed.
January 25, 2017 - Technology One senior executives were briefed by the council's independent review committee. Technology One alleged the meeting was not negative of their role in the project, but was critical of the council.
January 25, 2017 - Lord Mayor held a press conference indicating Technology One was responsible for the substantial cost of $60 million and time over runs - giving the company until July 2017 to deliver the software and the council to 'reform the project'.
January 25, 2017 - Technology One issued a statement to ASX to correct alleged inaccuracies in Lord Mayor's statement
January 30, 2017 - Technology One issued a second statement to ASX. Mr Di Marco said Technology One was not aware of the dispute until the council made the media statement.
February 3, 2017 - Technology One issued Notice of Delay because the council had allegedly not addressed the variation of $3.6 million issued on January 9
February 10, 2017 - The council issued Notice of Remedy for milestones allegedly not met by Technology One
March 6, 2017 - Two council executives responsible for the project left their jobs with the council
April 13, 2017 - Technology One issued the council with Notice of Breach. It is alleged the council refused to participate in next stages of project with no valid reason.
April 18, 2017 - Mr Di Marco wrote personally to the Lord Mayor, offering to meet personally and attempt to resolve the matter. The Lord Mayor allegedly refused the request.
April 27, 2017 - The council issued a second Notice to Remedy following Technology One's Notice of Breach on April 13
April 28, 2017 Technology one released statement to ASX that no significant progress had been made on the project since January 25 as the council was allegedly stopping the contact from progressing
May 2, 2017 - Technology One responded to and disputed the council's Notice to Remedy sent April 27
May 2, 2017 - The council issued Technology One with a Notice to Show Case.
The council spokesman said the council had an alternate view on many of the points made by Technology One.
"The council LGS independent review team dispute the IT company's version of events surrounding the 25 January briefing," the spokesman said.
A statement from Technology One said the company remained confident of its legal and commercial position and would vigorously pursue its legal rights.