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Judge issues ruling in preliminary trial of legal actions over highways procurement and abandonment decision

A High Court judge has handed down his findings in a preliminary trial of a procurement challenge brought over the award of a highways contract where the claimant scored just 0.03 lower than the winning bidder.

Mr Justice Stuart-Smith said in Amey Highways Ltd v West Sussex County Council [2019] EWHC 1291 (TCC) that the claimant, Amey, had brought two sets of proceedings against West Sussex alleging failures in the council's procurement of a contract known as "Highways Term Service Contract 2018-2028. The procurement was governed by the Public Contract Regulations 2015.

West Sussex had decided to award the contract to Ringway Infrastructure Services. Amey's overall score was assessed to be 85.48, which Ringway bettered by 0.03.

In its first action, Amey alleged that its score should have been higher than Ringway's and that it should have been awarded the contract.

The council applied to strike out critical parts of Amey's pleaded case. Amey responded by applying for summary judgment on its claim. Those applications were the subject of a judgment which the judge handed down on 30 July 2018, dismissing each party's application [2018] EWHC 1976 (TCC).

The council then gave notice on 2 August 2018 that it was "terminating" the procurement and would start again ["the Abandonment Decision"]. It was the council's hope and intention that withdrawing the procurement would defeat any claim that Amey might otherwise have.

Amey promptly issued its second set of proceedings challenging the lawfulness and effect of the withdrawal.

At a case management hearing on 18 December 2018, the Court gave directions consolidating the two actions and directed that there should be a trial of the second action and of the effect on Amey's claim in the first action of the council's decision to withdraw the procurement.

The parties agreed a list of issues for determination. Mr Justice Stuart-Smith said that, put shortly, the critical issue was whether the council was right in its hope and intention that withdrawing the procurement as and when it did would bring Amey's claim (as articulated in the first action) to an end.

The agreed list of issues was as follows:

  1. Did the defendant council act manifestly erroneously, contrary to the PCR, by taking the Abandonment Decision:

(1) On the premise that it would supersede the claimant's claim in the first action?

(2) By taking into account the potential costs, uncertainty, delay and disruption to highways services that it considered would arise from continuing to contest the first action?

  1. Did the defendant act manifestly erroneously, contrary to the PCR, by taking the Abandonment Decision in a deliberate attempt to deprive the claimant of its cause of action in the first claim?
  2. Did the defendant breach its obligation of equal treatment imposed by the PCR in taking the Abandonment Decision because the claimant alone had an enforceable cause of action in respect of any errors in the conduct of the procurement?
  3. Did the defendant breach its obligation of transparency imposed by the PCR in taking the Abandonment Decision because its stated reason or reasons for the decision was not that the decision was taken in a deliberate attempt to deprive the claimant of its cause of action in the first claim?
  4. Did any breach established by the claimant cause loss or damage to the claimant? In particular, would the defendant have decided to abandon the procurement on a lawful basis in any event?
  5. What relief, if any, should be granted to the claimant?
  6. What was the effect of the Abandonment Decision on the first claim?

Mr Justice Stuart-Smith answered these issues as follows:

i) Issues 1-4: no.

ii) Issue 5: the council would not have abandoned the procurement in any event and, if Amey establishes that its score should be revised to be greater than 85.51, the breach established by Amey caused it to suffer loss and damage.

iii) Issue 6: Amey's claim for damages in the first action may be pursued as indicated in this judgment. The judge did not grant any other relief, declaratory or otherwise.

iv) Issue 7: the Abandonment Decision had no effect on the first claim if and to the extent that Amey is able to prove that it had an accrued cause of action before the decision was taken on 2 August 2018.

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