In ESCOBAR v SSHD ( “)”$ ) EWHC 1097 ( Admin ) it is held that whereas an administrative decision cannot have legal effect unless and until it has been communicated to the individual in question, a decision could have effect where notification had been provided, but the individual, for whatever reason, had not read it.

In R (NCCL) v SSHD (2024) EWHC 1181 (Admin) a Divisional Court (Green LJ and Kerr J) address a consultation issue from para 131, state the basic principles as follows:-

“152. The law governing the obligation to undertake public consultation is now reasonably well settled. A public body or decision maker owes no general duty in all cases to consult interested persons before deciding upon a measure. But the decision maker may become subject to such a duty in certain circumstances. A duty to consult may be enacted by a statutory provision. If the duty is statutory, the scope of the obligation is determined primarily by the terms of the statute. The process ordained in the statute must be followed and must, in addition, be undertaken in a fair manner.

153. A duty to consult may arise at common law in the second, third and fourth cases identified in the judgment of the Court in R (on the application of Plantagenet Alliance Ltd) v Secretary of State for Justice [2014] EWHC 1662 (Admin), at paragraph [98(2)] where: (i) there has been a promise to consult; (ii) there has been an established practice of consultation; and (iii) where exceptionally a failure to consult would lead to conspicuous unfairness…

154. It is however common ground that where a consultation exercise is carried out voluntarily, it must be carried out “properly and fairly” …

155. Not every process of communication and discussion by a public body with chosen interlocutors engages an obligation to carry out a full consultation exercise meeting the requirements of the Gunning criteria …”

“159. It is important to recognise the purpose of public consultation … its purpose “has various strands”: first, to improve the quality of decision making; secondly, to ensure fairness is accorded to those who may be affected by a regulatory change and to avoid the sense of injustice they may feel if they are not consulted; and thirdly, as “part of a wider democratic process” …

160. Thus, the purpose of consulting goes beyond merely informing the reasoning in support of the eventual decision. Consultation should ensure that the decision is both of high quality and justly reached. Fairness in carrying out a consultation is part of procedural fairness in decision making more generally. In Plantagenet, the Divisional Court treated the common law duty to consult as part of a wider common law duty of fairness, sitting alongside the two other common law duties …: to make sufficient enquiry and to have regard to relevant considerations.

161. As in other contexts where procedural fairness is at issue, what fairness demands will depend on the facts of the case and the context. Whether those demands have been satisfied in a particular case is a matter for the court, not the decision maker.”

“170. The Gunning criteria [do not] necessarily embody the totality of the requirements in all cases where consultation is undertaken on a voluntary basis. The criteria are valuable and might cover very many cases but the test is ultimately one of fairness, a “protean concept”…

171. We start with a question: who must be consulted? The answer to this is context sensitive, in a statutory consultation, the legislation may provide the answer, which may be such persons as the decision maker considers appropriate, or some similar formulation. In such cases, it is for the decision maker to decide, subject to rationality, who is appropriate to be consulted. The Court would not interfere merely because other persons not selected, could have been found appropriate.

172. In other cases, there might be no statutory duty to consult or even no duty to consult at all. …”

“181. … we take the law to be as stated by Elias LJ in the Milton Keynes case: there may be circumstances where a voluntary but selective consultation exercise will render a decision taker pursuant to it unlawful. Such cases might be relatively rare. The Court will tread with care in characterising as a consultation a process of Government engagement with those from whom it seeks advice.”

“184. Ground IV succeeds. A voluntary consultation was undertaken. It was however one-sided and not fairly carried out. For this reason it was procedurally unfair and unlawful.”

The interest of the case is not confined to consultation. At paragraph 115 the Court said:-

“The principles of Parliamentary sovereignty and the separation of powers have their genesis in the common law and it the duty of the courts to protect those principles…

The issue … is whether those constitutional principles are violated when the Executive uses a statutory power to make subordinate legislation for an object and purpose which it has earlier failed to achieve by primary legislation.”

The answer (paragraph 118) was: “No”.

The Cabinet Office has issued and presented to Parliament at National Procurement Statement (the NPPS), setting out “the strategic priorities for public procurement and how contracting authorities can support their delivery”.  It is due to come into effect on 28 October 2024.  That will be alongside the introduction of the Procurement Act 2023.  The NPPS identifies national priorities to which contracting authorities should have regard in exercising their functions relating to procurement.  These relate to value for money, social value, SMEs, commercial and procurement delivery, and skills and capability for procurement.

Value for money must be placed at the forefront of all procurement activities: para 8.

As regards Social Value the NPPS states:-

“10.     All contracting authorities should have regard to the following outcomes in their procurement activities, alongside any additional local priorities, where it is relevant to the subject matter of the contract and proportionate to do so:

• Creating resilient businesses and opportunities for quality employment and skills development.
• Improving innovation, supply chain resilience and security of supply.
• Tackling climate change and reducing waste.

11. There are a number of ways that contracting authorities can implement these outcomes, for example, changes to the way the procurement is structured or the process carried out, the specification of the goods, services or works to be purchased, or the award criteria which will determine the most advantageous tender.
12. Whilst it can be beneficial to consider such additional benefits, achieving them without overburdening suppliers is crucial. Contracting authorities should ensure that they do not place onerous requirements on suppliers, or use disproportionate clauses in tenders and contracts.  For example, contracting authorities should not ‘gold-plate’ the Equality Act 2010 by setting unnecessary diversity reporting or ‘equality, diversity and inclusion’ requirements for the private and voluntary sectors.”

As regards SMEs, the NPPS states:-

“13.     Small and medium-sized enterprises (SMEs) are the backbone of our economy. It is vital contracting authorities support businesses to achieve sustainable growth and open up public procurement opportunities to more SMEs, voluntary, community and social enterprises (VCSEs) creating a thriving, competitive marketplace.  SMEs not only play a key role in communities by providing a local service and employment but can also offer innovative solutions to public service delivery.

14.       Contracting authorities should ensure that they level the playing field for SMEs, VCSEs and start-ups to compete in public procurement by reducing and removing barriers in the procurement process.”

A force majeure clause relieves a party from its obligation to perform under a contract on the occurrence of specified events that are beyond the reasonable control of the parties.  Force majeure clauses commonly include, expressly or impliedly, a “reasonable endeavours” proviso, stating that a party cannot however rely on what would otherwise be a force majeure event if that party could avoid the effects of the event by the exercise of “reasonable endeavours”.  The appeal to the Supreme Court in RTI v MUR (2024) UKSC 18 concerned the interpretation of a force majeure clause in a shipping contract.  However, the central issue in the appeal was whether the exercise of reasonable endeavour may require the party affected, if it is to be entitled to rely on the force majeure clause, to accept an offer of non-contractual performance from the other contracting party in order to overcome the effects of the specified event.  Although this question arose in relation to a specific force majeure clause, it has significant implications for the interpretation of reasonable endeavours provisos and force majeure clauses more generally.

The Supreme Court unanimously allowed the appeal.  MUR’s rejection of RTI’s offer of non-contractual performance did not constitute a failure to exercise reasonable endeavours.  Therefore the reasonable endeavours proviso did not prevent MUR from relying on the force majeure clause.  MUR was correct that, absent express wording, a reasonable endeavours proviso does not require acceptance of an offer of non-contractual performance.  This conclusion is supported by principle and by the authorities.

There are several reasons of principle which support MUR’s case.

First, force majeure clauses, and reasonable endeavours provisos, concern the casual effects of impediments to contractual performance. The party affected must be able to show that the force majeure event caused the failure to perform. That means establishing that the failure to perform could not have been avoided by the exercise of reasonable endeavours.  Contractual performance means performance of the contract according to its terms.  Failure to perform means a failing to perform in accordance with those terms.  The casual question is to be addressed by reference to the parameters of the contract.  The object of a reasonable endeavours proviso is to maintain, not alter that contractual performance.

Second, the principle of freedom of contract includes the freedom not to contract.  This extends to the freedom not to accept non-contractual performance.

Third, clear words are needed to forego valuable contractual rights.  RTI’s interpretation is inconsistent with the general principle that contractual parties do not forego their valuable rights without it being made clear that that was their intention.

Fourth, certainty and predictability are of particular importance in the context of English commercial law.  MUR’s case is straightforward: absent clear wording, a reasonable endeavours proviso does not require acceptance of an offer of non-contractual performance. The focus of the reasonable endeavours inquiry is clear: what steps can reasonably be taken to ensure contractual performance.  The limits to that inquiry are also clear; they are provided by the contract.

By contrast, RTI’s case is not anchored to the contract.  It begs a number of questions and gives rise to considerable legal and factual uncertainty.  In particular, it requires inquiries into whether the acceptance of non-contractual performance would: (i) involve no detriment or other prejudice to the party seeking to invoke force majeure, and (ii) achieve the same result as performance of the contractual obligation in question.  There is no justification for creating needless additional uncertainty by departing from the standard of performance provided by the terms of the contract.