Remedies and time limits: a summary

Tuesday November 1st, 2011

By Ruth McNaught, Solicitor, Harper Macleod LLP

On 7 September, we blogged about the introduction of the Public Procurement (Miscellaneous Amendments) Regulations 2011 (‘New public procurement regulations impact timelines for making complaints’), which came into force on 1 October 2011.

We described that the key change introduced by the Regulations was the requirement for aggrieved bidders to bring proceedings under the procurement rules within 30 days of the date of knowledge of the issue giving rise to the suspected breach, with Court discretion to extend the period up to a maximum of three months from the date of knowledge. We noted that the ‘date of knowledge’ is the date on which the economic operator first knew or ought to have known that there were grounds for raising proceedings, leaving the Court to decide when this knowledge occurred based on the circumstances of the case.

Since their introduction, the Regulations have received much attention from contracting authorities, bidders and their advisers and, in this latest blog, we summarise the new position and its interaction with the Public Contracts (Amendments) Regulations 2009 (SI 2009/2992) which brought the new Remedies Directive into law.

Parties to a procurement should be aware of two important dates: 20 December 2009 and 1 October 2011.

The first date will impact upon the choice of remedies available in the event of a successful challenge. The second will decide the limitation period within which that challenge must be brought.

The Remedies Directive and the 2011 Regulations were both brought into domestic law in phases and, as such, there are four permutations that could apply:

  • The procurement exercise commenced before 20 December 2009 and the claimant knew (or ought to have known) that grounds for raising a challenge had arisen before 1 October 2011: the old remedies apply and the limitation period is three months.
  • The procurement exercise commenced on or after 20 December 2009 and the claimant knew (or ought to have known) that grounds for raising a challenge had arisen before 1 October 2011: the new remedies apply and the limitation period is three months.
  • The procurement exercise commenced before 20 December 2009 and the claimant knew (or ought to have known) that grounds for raising a challenge had arisen on or after 1 October 2011: the old remedies apply and the limitation period is 30 days.
  • The procurement exercise commenced on or after 20 December 2009 and the claimant knew (or ought to have known) that grounds for raising a challenge had arisen on or after 1 October 2011: the new remedies apply and the limitation period is 30 days.

As readers will be aware, under the old remedies regime, once contracts had been awarded and entered into by contracting authorities, the remedies available to unsuccessful bidders (or bidders not invited to tender) were limited to a claim for damages, which is traditionally difficult to prove and costly to bring about. The Remedies Directive introduced an option for the courts to declare a contract ‘ineffective’ in circumstances where it has not been properly tendered and offered no opportunity for challenge prior to the contract being awarded. It also created incentives for litigation by lowering some of the hurdles faced by claimants and increasing the range and gravity of the remedies available.

Whichever remedies regime applies, the limitation period for bringing an action starts on the date the claimant first knew or ought to have known that grounds for starting the proceedings had arisen. Where the remedy of ineffectiveness is being sought, however, a different limitation period applies. This is, of course, only applicable to procurements that are subject to the new remedies (those commenced on or after 20 December 2009).

Ruth is a solicitor at Harper Macleod LLP and can be contacted on ruth.mcnaught@harpermacleod.co.uk

www.harpermacleod.co.uk

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