This was the last in a series of claims brought against the Legal Services Commission (LSC) relating to the 2010 round of tenders for legal services contracts. Proceedings were issued in the Administrative Court in November 2010 and only reached trial (in the TCC) in October 2017. Mr Justice Coulson commented on the procedural history of this case in the judgment not because it was relevant to the issues but in the hope that “it will come to be regarded as an example of how not to conduct a public procurement challenge.” The claim failed.
The Claim
The claimant had bid for an immigration services contract in London along with over 400 other firms. However, it did not provide an answer to 4 out of 7 scored questions and failed to score enough marks to gain a contract. It claimed that the defendant should have allowed it to clarify its tender by filling in the missing answers and rescored its response.
The claimant argued that a duty to clarify arose under Tideland Signal v Commission [2002] ECR II-3781 and that the defendant breached the equal treatment principle (Fabricom SA v Belgian State [2005] 2 C.M.L.R. 25) in its decision not to allow the claimant to clarify its bid while, it claimed, permitting other tenderers to clarify theirs in comparable circumstances.
There was no oral testimony. The Judge assessed the extensive disclosure, submissions and evidence in reaching his conclusions.
The Judgment
Mr Justice Coulson considered the applicable EU and UK cases and summarised the Tideland principles at paragraph 17 of the judgment. Notably, he found that (a) the duty to clarify arises only in exceptional circumstances; (b) a duty may arise where the tender is ambiguous; but only (c) where the ambiguity probably has a simple explanation and is capable of being easily resolved; (d) it may also arise where there is an error which is simple, material, serious and manifest; but (e) the duty will not arise when any clarification or amendment would in reality lead to the submission of a new tender.
Six cases brought against the LSC in relation to the 2010 tender round were considered by the court. All failed.
Having considered the evidence, the Judge set out “The Shape of the Case”. Would a different approach by the authority have changed the outcome? Of the missing answers to questions 4 – 7, the claimant did not claim any points for question 4. It therefore needed to gain full marks on each of Questions 5 to 7 to make up the difference in points between its score (18) and the score needed to gain a contract (33).
The claimant lost on all aspects. As to question 5 (commitment to offer a weekly drop in session), there was no obvious error and no ambiguity. The defendant was entitled to take the failure to respond at face value and assume that the claimant was not offering the commitment. The tender document was clear on the consequences of failing to answer a question. If the claimant had been asked after the event whether it would commit to a drop in centre an affirmative answer would clearly improve its bid by 2 points. A further 7 tenderers in similar circumstances also had their appeals on question 5 refused.
There was no duty to clarify and no breach of equal treatment. This finding in itself was fatal to the overall claim. But the Judge went on to consider the case on question 6 and 7, reaching the same conclusion for similar reasons.
The Judge considered the wider claim that there was a pool of about 120 comparators in other parts of the procurement to be misconceived. To treat these situations as comparable to the claimant’s circumstances would bring the procurement process to a grinding halt. It would require the defendant to provide disclosure to every aggrieved tenderer of its treatment of every other tenderer (here, 400 or so) on every aspect of the procurement process. In the Judge’s words, “the claimant’s comparison marathon became an exercise in futility.”
The Judge addressed the absence of any evidence to support a damages claim and noted his concern at the “abysmally slow and haphazard fashion” in which the claim had been conducted and the disregard shown by the claimant to orders of the court and CPR.
Costs
When ruling on costs at the handing down of the judgment, the Judge also took into account the evidence of unjustified personal attacks made by the claimant against various employees of the defendant by way of actual and threatened complaints to the Bar Standards Board and Solicitors’ Regulatory Authority and the bringing of an application for contempt of court a month prior to trial, which was later withdrawn.
The claim was dismissed and the claimant was ordered to pay the defendant’s costs of the action, with costs after March 2013 to be assessed on an indemnity basis.
Commentary
The case is instructive on how the court applies the principle of proportionality when assessing what can reasonably be expected of a contracting authority in conducting a complex public procurement exercise, particularly one with multiple bidders.
The judgment recognises the practical challenge faced by authorities in applying the tender rules and general principles to the range of different situations encountered in the course of a tender. A margin of discretion is enjoyed by the authority in making decisions as to when to clarify or validate tenders and in dealing with the grievances of unsuccessful bidders.
Absent any evidence of different treatment in directly comparable situations, a challenge such this one has to show that the exercise of that discretion is vitiated by manifest error. The concept of manifest error was the basis for the European Court’s formulation of an exceptional duty to clarify tenders in Tideland.
The case also cautions against an over-broad application of the equal treatment principle – comparators need to relate to the part of the tender that matters, that is those questions which are in issue. An attempt to draw comparisons from parts of the tender which are not in issue, such as the PQQ “is to elevate the comparison exercise to ridiculous and disproportionate heights. Such matters cannot provide a proper or meaningful comparison within the confines of a ‘manifest error’ challenge.”