Colin Lenton-Smith
Commercial and Finance Director, Post Office Account Team
Fujitsu Services Limited
Forest Road
Feltham
MIDDLESEX
TW13 7EJ
30.07.03
Dear Colin
Re: Disputed Invoices
I have again reviewed the contractual position of CCNs 297, 333a and 437.
My conclusion is again that the work specified in these CCNs is included in
the prices in Schedule A12 of the 28 July 1999 contract. My reasons for
reaching this conclusion are as follows:
All three CCNs are in Part 1 of Schedule A17. In the case of CCN 437 this is
because it is listed in Part 1. In the cases of CCNs 297 and 333a it is because
they were agreed after 9 July but before signature of the contract and so
satisfy the condition in Clause 810.10.2.
The effect of clauses 810.10.1 and 101.1 is that the CCNs in Part 1 relate to
the Codified Agreement and no longer relate to the POCL Agreement and
Authorities Agreements of 15 May 1996. The version of clause 810.10.1 of
the Codified Agreement that is relevant is that in the original version as signed
on 28 July 1999, since all three CCNs were approved before that date.
The work specified in the three CCNs had in fact been completed by ICL.
Pathway well before approval of the CCNs (indeed before the Codified
Agreement took effect). Therefore no charge is payable under the change
control provisions of the Codified Agreement (see paragraph 2.7 of Schedule
A05). Neither are any charges payable under the Authorities Agreement or
the POCL Agreement since these CCNs were never approved under those
contracts.
In fact, Post Office understood from ICL Pathway’s negotiators at the time that
because the work had been carried out, Pathway’s sunk costs for the relevant
work was being recovered in the roll-out payments specified in Schedule A12
of the Codified Agreement, and that the purpose of the CCNs was
administrative, namely to amend relevant documents to regularise the result
Page 1 of2
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Re: Disputed Invoices
of the unapproved work which Pathway could otherwise have been liable to
undo at its own expense.
Specifically:
* CCN 297 related to the introduction of Barcoded War Pension order
Books in July 1998 as part of Release 1c, and all work under the CCN
was completed prior to such introduction.
e CCN 333a related to introduction of AP tokens up to April 1998.
¢ CCN 437 related to training of Branch Office staff for the Live Trial.
This training was to be undertaken prior to the Core Observation
Period which was scheduled to start on 31 May 1999.
As you will be aware, Post Office has previously agreed to pay for work
carried out under CCN 411a which might appear to be a similar case.
However, CCN 41 1a is unique in that it was both raised and approved
between the dates of the Letter Agreement and the Codified Agreement and
so any work undertaken under that CCN prior to approval of the Codified
Agreement might be covered by the provision in parentheses in Clause 105.2.
Yours sincerely,
ORGNAL Sigsreh BY;
Keith Baines
Contract Manager
Post Office Ltd
IT Directorate
Calthorpe House
15-20 Phoenix Place
LONDON WC1X 0DG