Mears Ltd v Leeds City Council [2011] EWHC 40 (QB)

Wednesday January 19th, 2011
Neutral Citation Number: [2011] EWHC 40 (QB)
Case No: HQ10X03878

IN THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION

Royal Courts of Justice
Strand, London, WC2A 2LL
19/01/2011

B e f o r e :

THE HON. MR.JUSTICE RAMSEY
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Between:

Mears Limited
Claimant
- and -

Leeds City Council
Defendant

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Parishil Patel (instructed by Trowers & Hamlins) for the Claimant
Andrew Arden QC & Christopher Baker (instructed by The Solicitor, Leeds City Council) for the Defendant
Hearing dates: 10th December 2010

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HTML VERSION OF JUDGMENT
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Crown Copyright ©

    The Hon. Mr. Justice Ramsey :

    Introduction

  1. These proceedings concern a public procurement by Leeds City Council (“LCC”) known as the Leeds Housing Arms Length Management Organisation (“ALMO”) Procurement 2011 (“the Procurement”). The Claimant (“Mears”) was one of the tendering contractors in respect of lots 1 and 4 of the procurement which concern capital improvement and refurbishment works for social housing in the Leeds area.
  2. In 2007 LCC set up three ALMOs to manage social housing and the Procurement relates to housing for two of those ALMOs: Aire Valley Homes Leeds Limited (“Aire Valley”) and West North West Homes Leeds Limited (“West North West”). Mears was unsuccessful in its tender and made an application for an interim injunction to suspend the Procurement. At the hearing arranged to deal with that application Mears then made an application for disclosure of certain documents in the possession of LCC which, if disclosed, both parties accepted could have an impact on the application for the interim injunction. In addition LCC contended that certain of the allegations on which Mears relied in the underlying proceedings were time-barred under the provisions of Regulation 47 of the Public Contracts Regulations 2006 (“the Regulations”).
  3. In the circumstances it was agreed by the parties that the court should determine the application for disclosure and determine whether the allegations in paragraphs 20(1) and 20(2) of the Particulars of Claim were time-barred. Before turning to those issues it is necessary to set out some of the background to these proceedings. Background
  4. The Procurement was commenced on 21 October 2009 when LCC, through Aire Valley and West North West, published an OJEU Contract Notice which invited potential bidders to express their interest in participating in the Procurement. The Procurement involves contracts for two elements. First there is an element of capital improvement and refurbishment and responsive repairs and maintenance work to the housing and secondly there is the delivery of gas servicing repairs and maintenance works for the housing. These proceedings only concern the first element. The procurement was carried out under a competitive dialogue procedure pursuant to Regulation 18 of the Regulations.
  5. An application for inclusion in the Procurement was to be made by potential tenderers completing a Pre-Qualification Questionnaire (“PQQ”) and on 27 November 2009, Mears submitted a completed PQQ to LCC. There were 22 tenderers and LCC selected a shortlist of 9 tenderers, including Mears, to continue to the next stage, the invitation to participate in competitive dialogue (“ITPD”) and on 29 January 2010 LCC informed those tenderers that they had pre-qualified.
  6. On about 15 March 2010 LCC sent Mears the ITPD documentation in respect of the Procurement. The ITPD invited submission of “Outline Solutions Submissions (Quality and Cost)” in respect of the proposed works by 21 April 2010 but in response to requests from some tenderers, LCC extended the date until 5 May 2010.
  7. Section 8 of the ITPD set out the evaluation criteria to be used in the selection of a maximum of three tenderers to be invited to the next stage, the invitation to continue dialogue (“ITCD”). There was then to be the last selection stage, the invitation to submit final tenders (“ISFT”).
  8. The evaluation of the ITPD was to be carried out on the basis of scoring of which 40% was for price for each lot and 60% for quality, the three highest scoring bidders being selected.
  9. In respect of price, 100 marks were available for the lowest bid, with the other tenderers receiving a reduced score based on the difference in price as against the lowest tenderer. The pricing was to be submitted by completing a detailed spreadsheet issued by LCC containing a range of data and links between cells in the spreadsheet, to act as a common basis for the tenders.
  10. In respect of quality, 100 marks were available for each of the lots distributed between eight criteria in varying, identified, weighted amounts. Under each of the criteria paragraph 8.2.1 of the ITPD identified questions to be answered by the tenderers. The questions under each criterion were not weighted as against one another.
  11. During the evaluation period LCC reserved the right under paragraph 8.4 of ITPD to call for information from bidders to “clarify their bids to assist in its consideration and evaluation of the bid in question.”
  12. During the tender period LCC provided a number of changes to the pricing and qualitative aspects of the ITPD. Three amendments were made to the pricing sheets and one amendment to the “quality deliverable questions”.
  13. On 4 May 2010 Mears submitted its Outline Solutions Submissions in respect of the lots in the procurement. After the deadline had closed and after all tenderers had been received, LCC issued a clarification in respect of the Procurement by letter dated 14 May 2010 to all the tenderers. The letter stated We acknowledge receipt of your tender submission in relation to the above which is currently under evaluation. However we require that you take into account the following requirement and instructions with regard to pricing sheet number 1 (Rev 3).
  14. The spreadsheet contained eleven changes which the tenderers were required to take into account and they were to resubmit pricing sheet number 1 (Revision 3) by 4:00pm on 18 May 2010. By letter on 18 May 2010 Mears resubmitted its revised pricing sheet number 1 with its qualifications and alterations.
  15. Further clarifications were issued relating to pricing by e-mails dated 17, 18 and 21 May 2010. The first two involved clarification of the changes issued on 14 May 2010. The last e-mail did not involve any changes.
  16. On 2 July 2010 LCC informed Mears by e-mail that following the qualitative and quantitative evaluation undertaken of Mears’s Outline Solution Submissions in relation to lots 1 and 4, capital improvements and refurbishment work, they had been unsuccessful in being short listed to progress to the ITCD stage. They were told that the results of the tendering exercise would be posted on the LCC web-based bulletin board once the successful contractor had commenced work.
  17. On the same day, 2 July 2010, Mears sent LCC an email in which they sought feedback in respect of LCC’s decision.
  18. Between 15 July 2010 and 26 October 2010 LCC provided feedback on its decision. In particular LCC did so by a letter dated 1 September 2010 in response to letters dated 12 and 19 August 2010 from Trowers & Hamlin LLP, Mears’ solicitors. These Proceedings
  19. On 12 October 2010 Mears issued these proceedings seeking an interim order suspending the Procurement and an order that LCC re-run the Procurement either entirely or from the ITPD stage.
  20. On 2 November 2010 Mears served Particulars of Claim in which they alleged LCC was in breach of the Regulations in that they had failed to act with transparency and/or treat Mears equally and in a non-discriminatory way in that they had:  

    (1) Issued changes to the pricing aspects of the Outline Solutions Submissions after having received the tenders from the tenderers and whilst evaluating the same (paragraph 20(1) of the Particulars of Claim).(2) Provided an inadequate period of time for Mears to respond to the changes to the pricing aspects of the Outline Solutions Submissions made in the letter dated 14 May 2010 (paragraph 20(2) of the Particulars of Claim).

    (3) Evaluated the Outline Solution Submissions using undisclosed criteria and weightings, in particular:

     

    (a) Using the Guidance which LCC attached to their letter dated 1 September 2010 pursuant to which a maximum score could only be achieved where the tender’s response not only met LCC’s requirements fully but exceeded them.(b) On the basis that each sub-question under each section of the “Quality Deliverable Questions” carried the same weighting.

  21. By paragraph 27 of the Defence served by LCC on 30 November 2010 they asserted that in relation to paragraphs 20(1) and 20(2) of the Particulars of Claim the proceedings had not been brought within the period of three months as required by regulation 47(7)(b) of the 2006 Regulation and there was no good reason for extending the period within the which the claim should have been brought, on the basis that any grounds for bringing the Claim in respect of the clarification of the 14 May 2010 first arose on 14 May 2010.
  22. On 3 November 2010 Mears issued the application seeking an interim order that the Procurement in respect of lots 1 and 4, capital improvement and refurbishment work, be suspended until trial or further Order. The application was supported by a witness statement from Thomas Gregorek, a Senior Commercial Manager of Mears. The hearing of the application was fixed for 19 November 2010 but LCC sought an adjournment of that hearing.
  23. On 12 November 2010 I ordered that the hearing of the Application should be adjourned to take place on 10 December 2010 and gave directions for LCC to disclose relevant documents and for LCC and Mears to serve evidence. LCC provided an undertaking not to take any further steps in the Procurement until after 10 December 2010.
  24. On 24 November 2010 LCC filed witness statements from Mr Philip Rigby, Strategic Project Manager for LCC; Mr Paul Thomas, Principal Consultant at Turner & Townsend and Mr John Statham, Head of Strategic Landlord Services at LCC. On 30 November 2010 LCC filed its Defence. Mears served further witness statements dated 3 December 2010 from Mr Darren Pace, the Development Director of Mears and a second witness statement from Mr Gregorek. LCC then served second witness statements dated 6 December 2010 from Mr Paul Thomas and from Mr Statham.
  25. As set out above, at the hearing on 10 December 2010 it was agreed that the issues of disclosure and time-bar in relation to the 14 May 2010 clarification should be dealt with prior to considering the application for an interim order.
  26. At the end of the hearing on 10 December 2010 I gave my decisions on the application for discovery and on the time-bar and as a result of those findings the parties agreed that these proceedings should appropriately be transferred to the Technology and Construction Court for an early hearing on the issues arising from the allegations of breach of the Regulations in paragraph 20(3) of the Particulars of Claim and that, in the meantime, LCC agreed not to enter into a contract in relation to the Procurement pending that hearing.
  27. As a result I set out in this judgement the reason for my rulings in respect of disclosure and the time-bar. Disclosure

    Background

  28. Following the request from Mears for feedback, LCC sent Mears a spreadsheet attached to an email of 15 July 2010 with the title “Bidder Outline Submission Feedback”. It set out the overall scores achieved by Mears and went through the various sections of the Outlines Solutions Submissions setting out “OSS strengths”, “OSS weaknesses” and “missing/additional information to be provided”. In a number of the comments set out under those headings in the spreadsheet there was reference to “model answers”. For instance it said “medium scores to responses against model answers overall” or “some model answers missing” or “answers do not hit model answer”. When Mears responded to that feedback by letter dated 27 July 2010, with assistance from Trowers & Hamlin LLP, they made some reference to the model answers. In particular at paragraph 2.3.4 they said: References at B1, B2, B4, D and E have been made to the comparison exercise of our bid against “Model Answers”. This does not assist us in understanding where we have lost marks since we do not have copies of the model answers. Please explain what was required and how marks were allocated accordingly.
  29. They summarised their position by saying: You will appreciate that from the concerns identified above that (in addition to our concerns about price) we are extremely concerned that our quality submission has not been properly evaluated and that we lost considerable marks as a consequence. Further we are concerned that the Council has failed to comply with its legal obligations to ensure the equal treatment of all bidders and transparency.”
  30. On 6 August 2010 LCC responded to Mears letter of 27 July 2010 but did not respond in relation to the question of model answers. On 12 August 2010 Trowers & Hamlin LLP wrote to LCC in relation to quality. They noted that LCC had not addressed matters specifically raised in the letter of 27 July 2010 and asked LCC to do so without delay. In addition, in relation to the quality criteria used, they asked LCC to provide “1. The sub-criteria (and related scoring) used within each section of the Quality Submission; 2. The evaluation matrix used; and 3. The scoring sheets relating to our client’s bid.
  31. LCC responded in more detail in their letter of 1 September 2010 and in relation to quality said this: In terms of your request for sub-criteria and related scoring all the questions identified in the Quality Submissions part of the ITPD were assessed and evaluated by officers from West North West Homes, Aire Valley Homes and the Council and each question received a score out of 10, based on the guidance enclosed at Appendix 2.

    Mears submission was evaluated by a number of officers and details of the scores received using the guidance at Appendix 2 for each of the questions are provided at Appendix 3.

  32. Appendix 2 was a table which contained scores of 0 to 10 and a column which contained guidance for each score. For instance for the score of 0 the guidance was “question is unanswered“; for the score of 4 the guidance was “addresses the criteria, but basic evidence only provided“; for the score of 8 it stated “addresses the criterion and provides comprehensive evidence that indicated some innovation and the potential to deliver a high quality result“; for the score of 9 the guidance was “addresses the criteria and provides comprehensive evidence that indicated innovation and the potential to deliver a high quality result” and for a score of 10 the guidance was “comprehensive and value adding response that is innovative, includes full evidence of techniques and measurements employed, capable of exceeding expectations.
  33. In a letter dated 16 September 2010 Trowers & Hamlin LLP contended that the scoring guidance at Appendix 2 to LCC’s letter contained undisclosed weightings which should have been disclosed to tenderers under Regulation 30 of the Regulations.
  34. When Mr Rigby put in his Witness Statement dated 24 November 2010 on behalf of LCC he dealt with the question of the guidance which he had prepared in conjunction with the consultants. At Exhibit PRR9 he exhibited pages 2 to 8 inclusive of the written guidance document. At page 3 of that document at paragraph 3 “Scoring Requirements” there were instructions to scorers. The marking guidelines were dealt with as follows “Marking Guidelines – single score (out of ten in line with the table below) to be awarded against each question, evaluation panel members should refer to the guidance within the model answers.” The table on page 3, below that statement, was the one which had been sent out as Appendix 2 to LCC’s letter of 1 September 2010.
  35. Mr Rigby explained that pages 9 onwards of the document set out in relation to each question, as a guide, a “model answer”. He said the existence of these model answers had been disclosed to Mears because they were referred to by Mears in their letter of 27 July 2010. He said that no point about them had arisen in these proceedings and accordingly they were not material to the claim. He said “In any event the defendant would not disclose the model answers because (a) they do not change the criteria questions which bidders were required to address; (b) they were offered merely as guidance to those who were scoring; and (c) to disclose them especially while the procurement process is still underway and in circumstances where the claimant is seeking to have the process re-run, would self evidently negate the purpose of asking bidders to answer the questions and demonstrate their own judgment and quality in doing so.
  36. In addition as part of exhibit PRR9 Mr Rigby enclosed a PowerPoint presentation which had been delivered to scorers. In relation to the Quality Evaluation process one of the bullet points in the presentation stated “each question to be scored between 0 and 10 in line [with] score definition guidance documented at 3.1 when compared against model answer.
  37. This led to Mears seeking disclosure of the model answers. Although I have not been provided with the relevant correspondence, LCC did provide a copy of pages 9 onwards of the guidance document but in a heavily redacted form in which the relevant questions were identified but the model answers were redacted. The issue is therefore whether in these proceedings LCC should disclose to Mears those model answers. Submissions
  38. Mr Andrew Arden QC, who appears with Mr Christopher Baker on behalf of LCC, submits that these documents are not disclosable and are not contended by Mears to be disclosable as part of the information which LCC was obliged to provide under Regulation 32 of the Regulations. In particular he relied on the provisions of Regulations 32(13)(b) and (d) which state “A contracting authority may withhold any information to be provided in accordance with paragraph (1), (4), (8), (9) or (11) where the disclosure of such information-….(b) would otherwise be contrary to the public interest;..(d) might prejudice fair competition between economic operators.
  39. As a result he submitted that the court should not order disclosure of the model answers as part of the court process but, rather, under the principles in Science Research Council v Nassé [1980] AC 1028 such documents should be treated as confidential and should not be disclosed in these proceedings. He pointed to the problems which would arise if the model answers were provided at this stage and the court were later to determine that there had been some failure, so that the tender had to be repeated. He submitted that this would make it impossible for LCC to re-run the tender process as Mears would have access to model answers showing what LCC were seeking and such information would have to be provided to other tenderers. The tenderers would then use the model answers which would make it impossible for LCC to differentiate between them.
  40. Mr Arden also submitted that since Mears was provided with the necessary information on 15 July 2010 it was aware of the role of the model answers but had made no application for such documents until 1 December 2010 when Trowers and Hamlin wrote asking for disclosure. If it had been alleged that there was a breach of Regulation 32 in providing the information then any such proceedings should have been brought within three months under Regulation 47(7)(b).
  41. Mr Parishil Patel, on behalf of Mears, submitted that the evidence now provided by LCC shows that the model answers contain guidance against which the tenders were scored and that the model answers are therefore relevant documents which should be disclosed to Mears.
  42. He submitted that this is not an application for breach of Regulation 32 but is an application for disclosure in these proceedings where Mears alleges in paragraph 20(3) of the Particulars of Claim that LCC were in breach of the Regulations for failing to disclose the relevant sub-criteria and weightings on which they were assessing the tenders.
  43. So far as the timing of the application is concerned he submitted that Regulation 47 is not applicable and that Mears, through Trowers & Hamlin had sought the relevant documents in the letter of 27 July 2010. He referred to the fact that these proceedings are brought for a failure to provide sub-criteria and weightings and that the focus on the model answers as part of that case is now evident from the evidence put forward by LCC in the form of the guidance document and the PowerPoint slide. He submitted that in such circumstances, as made clear in Uniplex (UK) Limited v NHS Business Services Authority (C-406/08), time does not start to run until there is knowledge of the infringement and Mears did not know the role of the model answers until, at the earliest, Mr Rigby’s statement was served and cannot know whether there is in fact an infringement until they have seen the model answers themselves. In any event if the information provided to Mears on 15 July 2010 or 1 September 2010 were sufficient to allege an infringement then this is a case where there should be an extension of time.
  44. In relation to confidentiality, he submitted that it is arguable that on the basis of Morrison Facilities Services Limited v Norwich City Council [2010] EWHC 487 (Ch) these model answers should have been disclosed as part of the feedback under Regulation 32. In any event, so far as disclosure is concerned the documents can be provided within a “confidentiality ring” which would avoid the problems which LCC allege may arise from providing the model answers to Mears. Decision
  45. In these proceedings I made an order on 12 November 2010 that LCC should file and serve evidence which should include disclosure of relevant documentation. The proceedings include allegations at paragraph 20(3) of the Particulars of Claim that LCC have used undisclosed sub-criteria and weightings in assessing the tenders at the ITPD stage. From the documents disclosed with Mr Rigby’s witness statement it is evident that, in assessing the tenders, those involved were given guidance that they should assess the tenders by reference to the model answers. I consider that, in principle, the obligation of disclosure under the order of 12 November 2010 would include the model answers. Indeed that principle seems to have been accepted by LCC who sent through to Mears a copy of the model answers with the answers themselves all redacted.
  46. The main focus of LCC’s submission in that the model answers are confidential, would not have to be supplied as information under Regulation 32 and should not be disclosed as part of the court process.
  47. The model answers like, it seems, the “aide memoire of expected content” in Morrisons v Norwich CC at [24], were documents provided to those evaluating the tenders to assist them with carrying out the scoring of the information provided by the tenderers. In assessing the tenders against the criteria there will necessarily be a discretion as to how those tenders are assessed. To the extent that the model answers do not contain any new criteria, sub-criteria or weightings but perform the task of seeking to ensure fair and consistent assessment of the tenders within stated criteria, sub-criteria and weightings, then I accept that LCC would be entitled to keep the model answers confidential from the tenderers.
  48. If however the model answers do contain criteria, sub-criteria or weightings which should have been disclosed to tenderers under the Regulations then those matters should not only not be kept confidential but should have been provided to tenderers.
  49. At present, for the purpose of this application I consider that I should treat the model answers as containing confidential matters. However, as I stated in Croft House Care Limited v Durham County Council [2010] EWHC 909 (TCC) at [38] the mere fact that they are confidential does not prevent them from being disclosed. As stated in Science Research Council v Nassé, the ultimate test is whether disclosure and inspection is necessary for disposing fairly of the proceedings and, in making the decision the court must consider whether any special measure, such as redaction or hearings in private should be adopted.
  50. I have no doubt that disclosure of the model answers is necessary for disposing fairly of the proceedings and determining whether there were criteria, sub-criteria or weightings which were not disclosed. The model answers were evidently part of the guidance given by LCC to those evaluating the tenders. However, I consider that any confidentiality should be preserved at this stage. However, unlike the claimants in Croft v Durham CC, Mears is a large organisation where the mechanism of a confidentiality ring can be applied. In the first place therefore any inspection of disclosed documents should be limited to named solicitors in Trowers & Hamlin and named counsel. If they consider that there are grounds for contending that the model answers contain matters which should have been disclosed to tenderers then Mears should nominate a person, such as a director, manager or recently retired person, who would not have been involved in the Procurement, would not be involved in the Procurement and would not disclose any information to others in Mears including those who might have been or might in the future be involved in the Procurement. His or her role would be to give instructions to the lawyers. In addition, LCC should confirm that they have no reasonable objection to the person nominated by Mears for that purpose.
  51. I do not consider that the provisions of Regulation 32 apply to this application for disclosure of the model answers. In any event, I do not consider that the court could decide whether the model answers should not have been provided to Mears within the exceptions in Regulation 32(13) without having the opportunity to review the documents. The information provided to unsuccessful tenderers under Regulation 32 relates to the contract award procedures and is not the same as the documentation that should be disclosed under the obligation to give disclosure in these proceedings.
  52. So far as timing is concerned, an application for disclosure in these proceedings is not affected by any fixed time limit. Whilst late applications may not be granted I do not consider that any such issues arise in this case. In any event, subject to any argument at the trial of the preliminary issues, even if the provisions of Regulation 47(7) did apply to this application then, as dealt with in more detail below, time does not start to run until the date when the claimant knew, or ought to have known, of the infringement of the Regulations. I consider that in this case if there had been an infringement of Regulation 47 in terms either of a failure to provide the model answers as part of the information about contract award procedures or a failure in asserting, as LCC did at the hearing on 10 December, that the model answers might be withheld under Regulation 47(13), Mears would have to know of that infringement. Whilst reference was made to the model answers in the spreadsheet sent on 15 July 2010, I do not at present consider that this would have been sufficient for Mears to know or be in a position where they ought to have known of the infringement. Indeed without knowledge of what the model answers contain, it is difficult to contend that there has been any failure.
  53. In the circumstances, subject to the safeguards by way of a confidentiality ring, I order that LCC should disclose and give inspection of the model answers. The letter of 14 May 2010
  54. In paragraphs 20(1) and 20(2) of the Particulars of Claim Mears contends that LCC were in breach of the Regulations in two respects. First they say that in the letter of 14 May 2010 LCC issued changes to the pricing aspects of the Outline Solution Submission after having opened the Outline Solution Submission received from Mears and whilst evaluating it. Secondly, they say that the letter of 14 May 2010 provided an inadequate period of time for Mears to respond to the pricing aspects of the Outline Solution Submission. Submissions
  55. Mr Arden QC submitted that Mears were in breach of Regulation 47(7)(b) in failing to bring these proceedings within 3 months of 14 May 2010 or, at the latest, 18 May 2010 and that there are no good reasons for extending the period.
  56. Mr Patel accepted that, as set out by Mann J in Sita UK Limited v Greater Manchester Waste Disposal Authority [2010] EWHC 680 (Ch) at [46] to [49], what was needed was knowledge of the infringement and not knowledge of the loss. However, he relied on the decision of Coulson J in Amaryllis Limited v HM Treasury [2009] EWHC 962 (TCC) at [51] to [53] where he held that under Regulation 47(7) the “date when grounds for the bringing of the proceedings first arose” was not when the Pre-Qualification Questionnaire in that case was available for downloading but when the claimant’s answers to the Pre-Qualification Questionnaire were alleged to have been improperly and unfairly evaluated.
  57. He also referred to the decision of the European Court in Uniplex (UK) Limited v NHS Business Services Authority (C-406/08), where at [31] it was said that: It is only once a concerned candidate or tenderer has been informed of the reasons for its elimination from the public procurement procedure that it may come to an informed view as to whether there has been an infringement of the applicable provisions and as to the appropriateness of bringing proceedings.
  58. He therefore submitted that, on the facts of this case, it was not until the decision of 2 July 2010 that there was a specific or irrevocable act resulting from those changes and that until then it was open for LCC to proceed in a different way after 18 May 2010. He submits that it was not appropriate to commence proceedings until Mears knew of the reasons why it was eliminated from the procedure, which was 15 July 2010 at the earliest, so that the commencement of proceedings on 12 October was in time. Decision
  59. There have been a number of decisions which have dealt with the phrase in Regulation 47(7): “the date when grounds for the bringing of the proceedings first arose”. Many of those decisions were reviewed by Coulson J in Amaryllis and there have subsequently been the decisions in Uniplex and J Varney & Sons Waste Management Limited v Hertfordshire County Council [2010] EWHC 1404 (QB); [2010] LGR 801.
  60. The decisions on this aspect show that it is necessary to analyse the relevant breach or infringement of the Regulations. For instance a breach of Regulation 4(3) by failing to “treat economic operators equally and in a non-discriminatory way” or to “act in a transparent way” does not necessarily require there to be a decision to eliminate a tenderer from the procurement before there are the relevant grounds for bringing proceedings. Equally, a breach of Regulations 30(3), (4) or (5) in failing to use the stated weighting or criteria will generally only occur once a decision has been made to eliminate a tenderer based on non-stated weightings or non-stated criteria.
  61. Thus, in Jobsin Co UK Plc v Department of Health [2001] EuLR 685 at [26] to [28] Dyson LJ was dealing with a case where there were allegations that a Briefing Document failed to comply with the relevant regulations because it failed to set out the criteria by which the tender was to be assessed. He said this: 

    26. …It is clear that, as soon as the Briefing Document was issued without identifying the criteria by which the most economically advantageous bid was to be assessed, there was a breach of regulation 21(3). I do not understand Mr Lewis to dispute this. Moreover, it was a breach in consequence of which Jobsin, and indeed all other tenderers too, were then and there at risk of suffering loss and damage. It is true that it was no more than a risk at that stage, but that was enough to complete the cause of action. Without knowing what the criteria were, the bidders were to some extent having to compose their tenders in the dark. That feature of the tender process inevitably carried with it the seeds of potential unfairness and the possibility that it would damage the prospects of a successful tender.27. Mr Lewis submits that neither the loss nor the risk of loss was caused by the breach of regulation 21(3) until Jobsin was excluded from the tender process on 17 November. I reject that submission for the following reasons. First, it gives no meaning to the words “risks of suffering loss or damage” in regulation 32(2). It seems to me that those words are of crucial significance. They make it clear that it is sufficient to found a claim for breach of the Regulations that there has been a breach and that the service provider may suffer damage as a result of the breach. It is implicit in this that the right of action may and usually will arise before the tender process has been completed.

    28. That brings me to the second reason. It would be strange if a complaint could not be brought until the process has been completed. It may be too late to challenge the process by then. A contract may have been concluded with the successful bidder. Even if that has not occurred, the longer the delay, the greater the cost of re-running the process and the greater the overall cost. There is every good reason why Parliament should have intended that challenges to the lawfulness of the process should be made as soon as possible. They can be made as soon as there has occurred a breach which may cause one of the bidders to suffer loss. There was no good reason for postponing the earliest date when proceedings can begin beyond that date.

  62. In Risk Management Partners Limited v The Council of the London Borough of Brent [2008] EWHC 1094 (Admin) it was alleged that there had been a breach of the regulations in awarding contracts of insurance to a mutual insurance company which was limited to members of the London Boroughs. Brent contended that any breach of the regulations occurred when they informed the claimant that it was committed to going into the mutual insurance scheme. The claimant alleged that time did not begin to run until the insurance contracts were actually awarded to the mutual insurance company or when Brent abandoned the tender process. In finding that the claimant was correct, Stanley Burnton LJ referred to Jobsin and the decision of the House of Lords in a planning context in R (Burkett) v Hammersmith and Fulham LBC [2002] 1 WLR 1593 and said at [91] to [92]: 

    91. Translating these references from the planning context to the present context, in a case in which there is a claim that there has been an actual breach of the Regulations, the grounds for the bringing of proceedings arise when the first breach takes place. Jobsin is authority that those grounds arise even if at that date the claimant has not suffered loss, but only risks suffering loss. The context of Burkett differs from the present. In particular, the liability of a contracting authority for damages under the Regulations is a reason to require a claimant to bring proceedings as soon as a breach is apprehended, and in this connection I refer to paragraphs 33 and 38 of Dyson LJ’s judgment in Jobsin. However, given the identity of wording between regulation 47(7) and the former RSC Order 53, r 4(1) and the present CPR Part 54.5, that difference does not justify a departure from the principles laid down in Burkett. If Parliament or the draftsman of the Regulations had intended a different result from that applicable in judicial review proceedings, a different form of words would have been used. In my judgment, therefore, for the purposes of the Regulations in the present case “grounds of the bringing of the proceedings” first arose when the breach which forms the subject of the claim occurred. It would have been different if the claim were for an injunction to restrain a breach of the Regulations; but it is not. 92. It is therefore necessary to determine when the breach of the Regulations first occurred. It seems to me it was when Brent abandoned the tender process and awarded the contracts to LAML. That occurred in March 2007. Until then, it could have lawfully awarded the insurance contracts to a company participating in the tender process. It is not contended that on that basis RMP failed to satisfy the requirements of regulation 47(7) .

  63. In Henry Brothers v Department of Education for Northern Ireland [2008] NIQB 105 there had been an alleged failure to comply with the regulations in the way in which the tender documents had been prepared and this ultimately led to the claimant being unsuccessful in the tender. As Coghlin J said in Henry, up until the decision, it was open to the Department to amend or modify the criteria and the manner in which they were to be applied. Similarly it is evident from Amaryllis at [23] that the allegations concerned the manner in which the decision was arrived at based on the answers to the Pre-Qualification Questionnaire.
  64. In Uniplex the claimant was informed on 22 November 2007 that it had been unsuccessful in its tender for a framework agreement. In response to a request for information the NHS responded on 13 December 2007. Uniplex issued proceedings on 12 March 2008. The question was whether 22 November or 13 December 2007 was the relevant date when time started to run for the purpose of the three month period under the Regulations. The issue was therefore whether the relevant date was the date of the infringement or the date on which the claimant knew or ought to have known of the infringement. At [35] it was said that: The answer to the first question accordingly is that article 1(1) of Directive 89/665 requires that the period for bringing proceedings seeking to have an infringement of the public procurement rules established or to obtain damages for the infringement of those rules should start to run from the date on which the claimant knew, or ought to have known, of that infringement.
  65. The basis for that answer was set out in [30] where it was said: “…the fact that a candidate or tenderer learns that its application or tender has been rejected does not place it in a position effectively to bring proceedings. Such information is insufficient to enable the candidate or tenderer to establish whether there has been any illegality which might form the subject matter of proceedings.
  66. At [31], already set out above, the court said that it was only when the tenderer had been informed of the reasons for its elimination from the public procurement procedure that it might come to an informed view as to whether there has been an infringement of the applicable provisions and as to the appropriateness of bringing proceedings.
  67. I consider that [31] has to be read in the context of the facts of that case which concerned an alleged breach of the Regulations arising from the decision to eliminate Uniplex from the procurement process. There would be no need for the claimant to need to be informed of the reasons for that decision where the claimant has all the required knowledge of an earlier infringement and could make an informed view of whether it should bring proceedings based on that information.
  68. In J Varney & Sons Waste Management Limited v Hertfordshire County Council there was a challenge to the decision, made on 12 September 2008, not to award contracts. That challenge was based on allegations that the relevant criteria used to assess the tender had not been stated. The Invitation to Tender sent on 23 June 2008 did not disclose the award criteria and weightings and the claim was only commenced on 12 December 2008.
  69. Flaux J held that Varney knew of the breach on receipt of the Invitation to Tender and that the breach occurred on 23 June 2008 so that proceedings should have been commenced by 23 September 2008. He said at [121]: The reason why the general position is that time does not run until the claimant is informed of the reasons for its rejection is the obvious one that it is only then that the claimant knows or ought to know that there is a potential claim against the public authority in question. However, that is not invariably the position, particularly where, as in the present case, any breach of the obligation of transparency is apparent before the claimant’s tender was rejected or the claimant was informed of the reasons for the rejection. I can see no reason for artificially suspending the running of time in such a case until the claimant is told the reasons for rejection of his tender.
  70. In summary therefore, I consider that the following propositions can be derived from the previous decisions on when time starts under Regulation 47(7):  

    (1) The “date when grounds for the bringing of the proceedings first arose” will depend on the nature of the claim in the proceedings.(2) The grounds for making certain claims may arise before there has been any decision to eliminate a tenderer from the procurement process or not to award a contract to a tenderer.

    (3) Where the claim is based on infringement of the Regulations occurring during the procurement procedure and before any decision has been taken to eliminate a tenderer or award a contract to another tenderer, the date when the grounds arise will depend on when the claimant knew or ought to have known of that infringement.

    (4) Where a claimant knows or ought to know of the infringement, the grounds for bringing the proceedings will then arise. They do not arise only when there has been a decision to eliminate a tenderer or award a contract to another tenderer.

    (5) Where the claim is based on grounds which arise out of a decision to eliminate a tenderer or award a contract to another tenderer then those grounds will only arise when the tenderer knew or ought to have known of the infringement and this will generally depend on the tenderer being given the reasons for the decision.

    (6) The requirement of knowledge is based on the principle that a tenderer should be in a position to make an informed view as to whether there has been an infringement for which it is appropriate to bring proceedings. There is not a separate requirement relating to the appropriateness of bringing proceedings.

  71. Given those principles I can express my conclusion relatively shortly. In the present case it can be seen that the allegations in paragraphs 20(1) and 20(2) of the Particulars of Claim arise from an alleged breach in the tendering process in May 2010 when Mears contends, first, that LCC amended pricing aspects of the tender documents after receipt of and during consideration of the tender documents and, secondly, that LCC did not give sufficient time to respond to the amendments. Those are discrete breaches of the Regulations which do not depend on whether or not Mears were ultimately eliminated from the Procurement. It is clear that in May 2010 Mears had full knowledge of both the contents of the letter of 14 May 2010 and the time allowed to respond.
  72. By the time the period given in the letter of 14 May 2010 had expired, that is, at the latest, 18 May 2010, Mears had in my judgment sufficient knowledge to take an informed view as to whether there had been an infringement of the Regulations for which it was appropriate to bring proceedings.
  73. It follows that by 18 August 2010 the three month period under Regulation 47(7)(b) had expired and that the proceedings commenced on 12 October 2010 were not commenced within time. There were no grounds put forward by Mears for there being a good reason to extend the period and I see no basis for extending time.
  74. Accordingly, the proceedings in relation to the allegations in paragraphs 20(1) and 20(2) of the Particulars of Claim are brought out of time and must be struck out.

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