The Cancer Research Center of Hawai'i's new building plans have hit another snag, with the University of Hawai'i breaking off contract talks with a developer it worked with for four years.

Developer Townsend Hawai'i LLC is disputing UH's action and has filed a complaint with the state Office of Administrative Hearings that could tie up the project while the issue is settled.

In the complaint filed Tuesday, Townsend contends a contract existed with UH and that the university unilaterally terminated Townsend's contract rights. The developer is asking for a ruling affirming that a contract award took place.

"Despite clear acceptance of Townsend's proposal ... and Townsend's performance of contract work, UH has acted in bad faith to repudiate the contract, denying Townsend the full benefits from this contract," the complaint says.

UH spokeswoman Carolyn Tanaka said UH President David McClain had not seen the complaint and could not comment.

The dispute is the latest setback for the Cancer Research Center project, which has had to deal with questions over development financing, lease negotiations and whether its operations would compete with local hospitals offering cancer treatments.

The center, which operates out of a building next to The Queen's Medical Center, had hoped to break ground on its new $200 million Kaka'ako facility last year. That was revised to a possible start in mid-2010.

Townsend Hawai'i's involvement with the project goes back to 2005 when it was selected by UH to negotiate an agreement on designing, financing and building the project. Townsend said it had worked on the project, committing people and resources.

But in February, UH set a 90-day deadline for completing negotiations that excluded Townsend obtaining project financing. The new fee was supposed to be "substantially less" than prior fee proposals UH received.

On June 3, UH sent a letter to Townsend saying that since no agreement had been reached, it was ceasing negotiations and terminating the exclusive negotiation rights.

Dr. Michele Carbone, interim center director, downplayed any fallout from the dispute when contacted earlier this week. He said the financing from the Legislature remains intact and the property has been secured.

"I would not say at all the development of the center is jeopardized," Carbone said.

"This time, we will see it come out of the ground."