Liability clauses to be removed from CRC contract

The federal government is to remove a controversial liability clause from Commonwealth contracts with new Cooperative Research Centres (CRCs), education minister Brendan Nelson told delegates at last week's 2005 CRC Association Conference in Melbourne.

The minister's announcement came in the wake of threats by the Group of Eight (GO8) universities that they would not become CRC partners unless major changes were made to the new Commonwealth Agreement for CRCs.

In a letter to the minister, the GO8 raised issues with the contract, including clauses relating to liability and intellectual property ownership.

In a May 2 meeting of the University of Melbourne's Research and Research Training Committee, deputy vice-chancellor (research) Prof Frank Larkins said that "At this point, it seems unlikely that the university will agree to join the 'new style' CRCs and instead will provide services via research contracts."

Larkins did not return calls from Australian Biotechnology News to determine if the university's stance had changed since the minister's announcement.

However, president of the Federation of Australian Scientific and Technological Societies (FASTS), Snow Barlow, who was also present at that meeting, said he presumed the university would be reconsidering its decision.

"What the clause means is that where CRCs have an independent board, the university -- who are investors in those CRCs -- would have been individually liable for decisions made by a board which they had no representation on," said Barlow.

CRCA chairman Tony Staley said that as it stood, the clause meant that everyone signing the contract had to take joint and several liability even if they were not involved in any particular investment or decision of the CRC.

"We were delighted that the minister and the government responded so quickly and saw that there was a common sense approach. It was a very good, sensible decision," said Staley.

"One of the problems with [the clause] is, that these days, so many of the CRCs have a huge number of partners and simply getting people to agree, when they may have no involvement whatsoever in various matters, is a huge problem and impractical."

But the several liability clause is only one of the issues that the GO8 is concerned about. "That was the one that was giving most concern," said Staley. "And I'm sure discussions will continue on various other details to do with the contract."