Court of Appeal overturns High Court ruling that award of £560,000 focus group contract to friends of Dominic Cummings was unlawful

The Government has won an appeal over a High Court ruling that its decision to award a £560,000 contract for the provision of focus group and communications support services during the pandemic to Public First without public notice or competition gave rise to apparent bias and was unlawful.

The Government had sought to rely on the “extreme urgency” provisions in Regulation 32(2)(c) of the Public Contracts Regulations 2015 in relation to the award of the contract by letter dated 5 June 2020 but with an effective date of 3 March 2020 and an expiry date of 2 September 2020.

The award of the contract followed a strong recommendation by Dominic Cummings, then Chief Adviser to the Prime Minister. Public First was set up by former colleagues of then Cabinet Office Minister Michael Gove and Mr Cummings.

In R (Good Law Project) v Minister for the Cabinet Office [2021] EWHC 1569 (TCC) Mrs Justice O’Farrell had held that the claimant the Good Law Project, a public interest litigation organisation, had standing to bring the proceedings.

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She dismissed two grounds of challenge, namely that:

i) There was no basis for making a direct award under Regulation 32(2)(c), as the direct award of the contract to Public First was not strictly necessary;

ii) The award of the contract for a period of six months was disproportionate. Even if Regulation 32 was applicable, the claimant argued that the contract should have been restricted to the Minister's immediate, short-term needs, pending a competitive process to procure a longer-term supply of the services;

However, Mrs Justice O’Farrell did uphold the third ground, namely that the decision to award the contract to Public First gave rise to apparent bias contrary to principles of public law.

This finding was based on a combination of the personal association between Dominic Cummings and the directors and owners of Public First (which she found did not in itself to give rise to any apparent bias) and the Minister's failure to consider any other research agency or to keep a record evidencing that objective criteria were used to select Public First over other research agencies.

In The Good Law Project, R (On the Application Of) v Minister for the Cabinet Office [2022] EWCA Civ 21 the Lord Chief Justice Lord Burnett noted that no challenge or complaint was ever raised to the award of the contract by any potential competitor of Public First.

Lord Burnett described the High Court ruling as an unprecedented outcome: “a party with no potential interest in a contract has not hitherto obtained a declaration of unlawfulness on the basis of apparent bias in respect of a decision by a public body to grant a private law contract”.

The Minister for the Cabinet Office appealed against the finding of apparent bias. The Good Law Project cross-appealed against the dismissal of its claim under Regulation 32 and that the six-month duration of the contract was disproportionate.

The Court of Appeal rejected the Good Law Project’s arguments that the negotiated procedure without prior publication that led to the contract with Public First was not strictly necessary. Accordingly its cross-appeal failed.

The Lord Chief Justice therefore said the arguments in respect of apparent bias therefore fell to be considered in the context that:

i) This was a situation of extreme urgency;

ii) The negotiated procedure without prior publication with Public First, and the contract that resulted, were strictly necessary in accordance with Regulation 32(2)(c).

Lord Burnett found:

“88. The question of apparent bias ought to have been assessed on the basis that the reasons behind the decision to award the contract at the time that it was taken included, as set out in the evidence for the Minister, that:

i) Only two companies in the market had the scale, expertise and experience to provide the requisite services in March 2020, Public First and Britain Thinks;

ii) Public First was trusted and known to be capable of undertaking the required services speedily and effectively, and of debriefing under pressure;

iii) Public First was already in place conducting the research; therefore, using them was the most efficient and effective way of obtaining urgently needed research;

iv) Other companies, such as Jigsaw, YouGov and Kantar, did not have the relevant policy experience or had not carried out similar focus group work.

“89. The fair-minded and informed observer would have been aware of these reasons and the following material context:

i) There was nothing unlawful in the involvement of Mr Cummings in the decision-making process;

ii) The award of the contract was approved by Mr Aiken [Executive Director for Government Communication];

iii) The extent of the emergency arising out of the pandemic and the position of those involved in the process at the time, as set out in the unchallenged witness evidence of those involved;

iv) The extreme urgency brought about by these unforeseeable events was such as to engage Regulation 32. The use of a negotiated procedure without prior publication was strictly necessary;

v) There was thus no requirement on the Minister to carry out any procurement process, and no need for the Minister to consider other agencies. He was entitled to award the contract directly;

vi) Specifically, given the urgency of the need for the research in question, it would have been "utterly impractical to instruct someone else" on Thursday/Friday 27/28 February 2020 (as Mr Aiken said). There was an urgent need for focus group testing on the Thursday evening, the results of which were to be provided to No 10 the following day. After that work had been presented, the decision was taken to continue with Public First;

vii) It was vital that the services could be provided immediately and reliably, and that their output could be trusted;

viii) The Minister was not carrying out any adjudicative procedure, but rather making, and entitled to make, his own evaluative assessment in a small close-knit market as to which agency was best suited to his needs.

“90. Against this background, the fair-minded and reasonably informed observer would not have concluded that a failure to carry out a comparative exercise of the type identified by the Judge created a real possibility that the decision-maker was biased. Equally, the fair-minded and informed observer, realising, amongst other things, that the use of a negotiated procedure without prior publication (with Public First) was strictly necessary because of the pandemic emergency, would not have found the absence of any formal record of the decision-making process indicative of apparent bias.”

Responding to the ruling, Dominic Cummings tweeted: “CoA: no *actual* bias, not even *apparent* bias. Slam dunk. I/officials behaved reasonably & lawfully. Good to see common sense from CoA given emergency. But most important: we need new *clear simple emergency procurement system*, not Kimono wasting time & £ re loony EU rules.

“Also important & missed by media so far: Court of Appeal sends unmistakeable signal that it thinks *Kimono shd NOT have been given standing for this JR* & signals a future case shd kick him into touch.”

‘Kimono’ is understood to be a reference to Jolyon Maugham, Director at the Good Law Project.

Mr Maugham tweeted in response to the Court of Appeal’s ruling: “This is the first substantive judgment against us since 2019. We think, with respect, it's wrong and we are asking for permission to go to the Supreme Court.”

The Good Law Project said: “We haven’t lost a case in court since 2019. But you can’t win everything forever – especially when you fight the most difficult cases in the most difficult terrain."

The organisation set out its reasons reasons as to why it does not think the Court of Appeal was right.

It said: “We believe there is proper and widespread public interest in the extent to which the law restrains public servants from awarding valuable public contracts to their friends without adequate safeguards to protect against the risk of bias.”

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