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In July, RRP dismissed the assembly's accusation that it had allowed the projected cost of the architect-led scheme to spiral £13m over budget to £40m. It now appears that a misunderstanding over what the architect's budget was intended to cover led to much of that overrun.

The assembly understood that the £13.8m budget it set for Rogers covered the fit-out and consultants' fees, as well as the cost of construction. The architect thought that only construction cost was included.

The cost of land, IT and cabling took the total budget for the assembly to £27m.

An assembly source admitted the original contract did not seem to make RRP's duties clear. He said: "There is a problem over the contract. It is open to interpretation."

Construction lawyers commented this week that such a dispute is common, although surprising in such a high-profile project. One said: "It is not unusual for contracts to have problems in terms of their clarity. Parties should be absolutely clear about what the contract does cover, especially in relation to a key building like the Welsh assembly."

The lawyer added that fees are not detailed specifically in all forms of contract.

The assembly has increased the estimated budget of the 3300 m2 building to £33m. It said this allowed for inflation and extra fees incurred by the sacking. However, little of the additional budget should be spent on the legal costs of the dispute, as the assembly is using its solicitors at the Office of the Council General – the Welsh equivalent of the Lord Chancellor's Department.

The assembly is now looking for a developer or architect to take over the beleaguered project. Grosvenor Waterside, the landowner of the proposed Welsh assembly site, has already indicated that it is interested in completing the building.

Despite the moves, the assembly has not ruled out scrapping the project if costs continue to run out of control, although changes to the design are considered a more likely option.