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In a recent judgment, the Court of Appeal underscored the importance of the principles of transparency and equal treatment within procurement procedure.
On 6 September 2019, the Court of Appeal delivered a judgment in respect of an appeal brought by the Department for Infrastructure (“the Department”) against a High Court decision, relating to the award of contracts for multi-million pound public works known as the York Street Interchange Project.
The Department was responsible for awarding three NEC3 contracts to a single tenderer for the Belfast based works. The Project has an estimated cost of £120 – £165 million and is aimed at addressing a major traffic bottleneck. The scheme involves replacement of the existing junctions at York Street and will introduce measures to separate traffic via underpasses below the existing road. This will require the construction of approximately 5 kilometres of road, the realignment of the Westlink dual carriageway with the Clifton Street junction, the creation of interchange links and four new underpasses.
In January 2017, BAM McCann (Joint Venture) was notified that it had been unsuccessful in securing the contracts for the works. Represented by Cleaver Fulton Rankin, BAM McCann issued High Court proceedings wherein it successfully challenged the Department’s decision not to award it the contracts.
The High Court identified two significant errors committed by the Department’s Evaluation Panel in its assessment of BAM McCann’s tender. The errors identified were such as to affect the award of the contract and the learned Trial Judge quashed the award to the successful tenderer. The Department appealed the decision of the learned Trial Judge to the Court of Appeal.
The first issue which the Court of Appeal had to consider related to the scoring of an answer provided by BAM McCann. The answer was in response to a question seeking an outline methodology for planning and execution of elements during Phase 2 of the construction works. BAM McCann contended that an outline methodology had been provided, and it should not have received fewer marks than its competitor for omitting details which had not been sought in the question.
Citing a key passage from the European Court of Justice ruling in Commission v Netherlands (Case C 368/10)  3 Cmlr 234, the Court of Appeal noted that criteria and conditions relating to a contract award must be written in an unequivocal manner, so that “all reasonably informed tenderers exercising ordinary care can understand their exact significance and interpret them in the same way”. It was also noted that a Contracting Authority must be clear as to how it should interpret criteria. The Court of Appeal concluded that the learned Trial Judge had not erred in finding that the Department’s Evaluation Panel had failed to mark BAM McCann’s answer to this question in a clear, consistent and transparent manner.
The second issue which the Court of Appeal had to consider related to whether the Department’s Evaluation Panel had erred in its assessment of BAM McCann’s answer to a question on contract management. BAM McCann had been marked down for its response to this question for invoking the concept of value engineering at Phase 2 of the construction works.
The Court of Appeal noted that value engineering is a relevant public law consideration (in the context of compensation events) and concluded that the Department’s Evaluation Panel had made a “manifest error” in allocating fewer marks to BAM McCann for reference to this concept.
The Court of Appeal’s findings demonstrate that Contracting Authorities must act in a transparent manner at all stages of the procurement procedure. Criteria relating to the award of a contract must be capable of consistent interpretation by both Economic Operators and those evaluating their tenders. The appeal also highlights that even narrow errors in assessment of tenders can be crucial, particularly where they affect award of the contract.
The European Authority cited by the Court of Appeal reaffirms that Contracting Authorities must act consistently with the principles of transparency and equal treatment. Evaluation Panels must exercise caution in their assessment of tenders to ensure they do not go beyond any margin of appreciation they might have.
Whether the Court’s position will change in a post-Brexit environment remains to be seen. However, it is anticipated that the importance of clarity and consistency within procurement procedure will stay broadly unchanged.
This article has been produced for general information purposes and further advice should be sought from a professional advisor.