Unfair or improper procurement decision? Just because you don’t object in the standstill period, doesn’t mean you can’t later mount a legal challenge.
If you are thinking of challenging an unfair or improper procurement decision following submission of your tender, you will already know that it is going to be difficult. Not only will the procurement team close ranks but the timescales are short in which you can launch your challenge.
Challenging a Procurement Decision
Not so long ago, a procurement team from the Nuclear Decommissioning Authority took a challenge against it to the Court of Appeal on the basis that as the challenge was not lodged within the standstill period, it should be invalidated. In other words, their claim was that if you don’t mount your legal challenge within ten days of the award notification, you should not be able to do anything more. Having weighed all the facts, the Court of Appeal took the view that whereas the contract award could not be automatically stopped after the standstill period had expired, that did not affect the claimant’s 30-day window to pursue compensation for damages.
Moreover, the procurement team suggested that any damages which could be awarded should be strictly limited by a set of stringent EU case law conditions. Again, the Court disagreed and ruled that the award of damages should be based on UK law, discretionary and dependent on what position the challenger would have been in if the procurement had not gone wrong, e.g. loss of profit.
These decisions by the Court of Appeal will be welcomed by all bidders in public sector procurement competitions. They make it clear that a bidder who is unsuccessful because of an aberration of the process can decide not to invoke the automatic suspension provisions of the standstill arrangements. However, they can then pursue a damages claim later without running the risk that their arguments will be weakened because of this decision and that if successful, their damages will be proportionate with their losses.
If this decision in the Court of Appeal had gone the other way, this would have meant that in practice we only have a 10-day window in which to mount a formal challenge to an inappropriately awarded public sector contract. This is now clearly not the case. Of course, normally it would make sense that if you are going to challenge a procurement result, you do so as soon as there is sufficient information to give grounds to the challenge. However, there could be situations where as a result of this judgement it may be tactically better for you to wait until the standstill period is over, the contract awarded and then claim damages? In any case, if you are badly treated by the procurement process and your complaint stands the test of a legal challenge, you can expect fair compensation.
Author: Andy Haigh PPM APMP Director and Public Sector Bid Consultant, Sixfold International Ltd
This is a complex and possibly high-risk area and one that our partners at Sixfold have experience of. If you are thinking of contesting an unfair or improper procurement decision get in touch with them 01227 860375.
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