15 November 2018 | Firm news | Article by Emily Powell

Public Procurement implications for the duty of transparency and equal treatment and summary judgements

Background

In the recent procurement dispute of DHL Supply Chain Ltd v Secretary of State for Health and Social Care [2018] EWHC 2213 (TCC), the Claimant (“DHL”) challenged the award of a public contract for which DHL had submitted a tender but had been unsuccessful. DHL argued that the tender evaluation process had been unfair as the defendant contracting authority (Secretary of State for Health and Social Care (“SSHSC”)) had failed to follow the published selection criteria and breached the general principles requiring contracting authorities to treat bidders equally, without discrimination and act in a transparent and proportionate manner.

DHL challenged the award of the contract to the winning tender bidder, Unipart Group Limited (Unipart), by issuing proceedings against SSHSC. This triggered an automatic suspension on the contract award under Regulation 95(1) of the PCR 2015. SSHSC applied to lift the suspension.

DHL also issued an application for summary judgement. CPR 24.2 provides that the court can give a summary judgment if it considers that the defendant (SSHSC in this matter) has no real prospect of successfully defending the claim and there is no other compelling reason why the case should be disposed of at a trial.

The decision

The High Court (O'Farrell J) held that:

 

  • DHL was not entitled to summary judgment.

 

 

  • The automatic suspension was to be lifted which permitted SSHSC to enter into the contract with Unipart.

 

Regarding DHL’s application for summary judgement, the court considered the selection criteria which had been set out in the invitation to tender (ITT) to assess whether the obligations of transparency and equal treatment required had been upheld. The ITT had been clear due to express definitions within the document, allowing for a uniform interpretation by all reasonably well informed and diligent (RWIND) tenderers of the criteria. Further, there was dispute regarding influencing factors such as conversations at pre-bid meetings and the evidence required to prove relevant experience. The court could not determine such matters fairly without a trial.

With regards to lifting the automatic suspension on the contract award to Unipart, firstly the court considered whether an award of damages would be sufficient for both parties should the claim proceed to trial. The court decided that damages would not be sufficient for either. The court also considered the ‘balance of convenience’, and that public interest lay with a lift of the suspension. This was due to the impact on patient care and anticipated savings for the NHS if the contract award were to proceed with Unipart.

The impact

The court set a high threshold for obtaining summary judgement making it very challenging to obtain. The court considered that the RWIND test is not to be interpreted as straightforward. Although the test is determined objectively, a range of influencing evidence will be considered, not simply the wording of documentation, including context and conversations at meetings which will naturally require more time and subsequently a trial.

Regarding lifting the automatic suspension of a contract award, the court demonstrated that a balance of convenience will usually lie more favourably with a contracting authority that is acting in the public interest and where a suspension would have serious implications for public resources. This will make it difficult for a complainant to prevent an award of a contract in such circumstances.

To find out more about how this decision may impact your organisation, contact Emily Powell 

 

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