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Public Procurement and Incomplete Tenders by Jill Fryer, Harper MacLeod LLP

Tuesday December 13th, 2016

Binning bids – what do public bodies have to do with incomplete tender bids? jill-fryer_hd-2

Last month, the Court of Session decided that a public body was entitled to reject an incomplete tender and was not obliged to allow the bidder to correct an obvious error.

The opportunity concerned a framework agreement for demolition services for use by public bodies in Scotland. The bidder in question had failed to submit mandatory financial information and, in respect of one lot, had failed to submit a completed template. The bidder was excluded from the procurement process. The consequences for the bidder were significant – work for local authorities in Scotland was stated to represent about 60% of the bidder’s turnover and failing to be appointed to the framework would mean redundancy for some employees.

Where there is an obvious error in a bid, and particularly where the public body has reserved a right to seek clarification from bidders, the principle of proportionality may suggest that the public body can and should seek such clarification and allow amendment of the tender in order to correct the obvious error. It is generally in the public body’s interests to consider as many bids as possible, in order to ensure it obtains value for money.

On the other hand, the principle of equal treatment means that bidders should not be given a second chance to submit their bid as this gives them an unfair advantage over other bidders who did manage to submit compliant bids on time. It can be difficult in practice to distinguish these situations – what is legitimate clarification and what is unfair advantage to one bidder?

In this case, the court ruled that to seek the information would go beyond the scope of clarifying an ambiguity as it would be allowing the bidder to submit new information which they should have submitted originally.

Given the huge amount of work and effort which suppliers put into preparing public sector tenders, it is particularly frustrating when administrative errors prevent those tenders from even being considered.  Attention to detail and leaving plenty time for the submission of tenders are crucial.

Case: Dem-Master Demolition Limited v Renfrewshire Council [2016] CSOH 150 CA78/16

Jill is an Associate with Harper Macleod LLP and can be contacted at jill.fryer@harpermacleod.co.uk

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