Today the Supreme Court of Queensland decided that the State of Queensland was unable to prosecute a damages claim against IBM because the State had released that claim in 2010. Shane Doyle QC and Stewart Webster appeared for IBM, instructed by Jones Day.
In 2007, IBM won a contract to work with the Queensland Government to roll-out a whole-of-government payroll system. Part of the contract involved delivering an interim replacement payroll system for Queensland Health. The implementation of this replacement system was delayed and, once in operation, experienced a range of problems. Thousands of Queensland Health employees were underpaid, overpaid or not paid. IBM and the State differed strongly about who was responsible for these issues.
In December 2013 the State Government filed a claim for damages against IBM in the Supreme Court of Queensland, which it served on IBM in late 2014.
In early 2015 IBM applied for a declaration that the damages claim was subject to a release given by the State Government in 2010. The State opposed IBM’s application. A hearing was held in August 2015.
Today, Supreme Court Justice Glenn Martin ruled in IBM’s favour. His honour declared that “on the proper construction” of the supplemental agreement, IBM was released from the State of Queensland’s claims in its lawsuit, meaning that the State Government cannot proceed with its damages claim against IBM. Further argument relating to the payment of costs was adjourned until later this month.