Adequacy of damages

February 16th, 2018 by James Goudie QC in Decision making and Contracts

In the public procurement case of Word Perfect Translation Services Ltd v Minister for Public Expenditure and Reform 2018/20, the Irish Court of Appeal declined to lift an automatic suspension, holding that (1) the claimant could obtain only Francovich damages, (2) damages were therefore not an adequate remedy for the claimant, and (3) the fact that damages are not an adequate remedy may well be decisive in terms of evaluation of where the greatest risk of possible injustice and the balance of convenience lies.

 

 

Automatic Suspension

February 12th, 2018 by James Goudie QC in Decision making and Contracts

Lancashire Care NHS Foundation Trust v Lancashire County Council (2018) EWHC 200 (TCC) concerns yet another application to lift an automatic suspension on the award of a contract imposed by virtue of the claimants issuing a claim form, within the necessary time period, challenging the results of a procurement exercise for that contract in which they were unsuccessful. Fraser J refused to lift the automatic suspension.

The procurement the subject matter of these proceedings concerns Public Health and Nursing Services to be provided to children and young persons from birth up to the age of 19, including services that concern children and adolescent mental health, across the county of Lancashire. It therefore involves a sizeable population and includes some of the most vulnerable members of society. The procurement exercise and the contract are both subject to the Public Contract Regulations 2015 (“the Regulations”).

The two claimant trusts (“the Trusts”) are the incumbent providers of these services to the Lancashire County Council (“the Council”) and there can be no question of there being any interruption in the provision of these services. Apart from any other considerations, the Council is statutorily obliged to provide such services to the residents of Lancashire under the Health and Social Care Act 2012, and will and must continue to do so. These services are being provided now by the Trusts and the contracts under which they do so expire on 31 March 2018. Were it not for the automatic suspension, from 1 April 2018 onwards (for a five year term) these services would be provided by the winning bidder in the procurement exercise the subject of these proceedings, namely Virgin Care Services Ltd (“Virgin”). Only the Trusts, and Virgin, bid for the supply for the Services in the procurement exercise.

Fraser J, from paragraph 14 of his Judgment, recited the legal principles. He stated, at paragraph 16, that the principles to be applied on such an application are widely accepted as being analogous to those that are applied on an application for an interim injunction. This test therefore now, under the Regulations, explicitly incorporates the American Cyanamid principles as summarised by Coulson J in Covanta Energy Ltd v MWDA [2013] EWHC 2922 (TCC).  The first question is whether there is a serious issue to be tried. If there is, then there are two further questions: namely whether damages are an adequate remedy for a party who was injured by the grant or the failure to grant the injunction, and the more general question as to where the balance of convenience lies. These two questions have to be considered in stages because the relevance of the availability of an adequate remedy in damages, either to the claimant seeking the injunction or to the defendant in the event that an injunction is granted against him should always be considered first. The public interest should be taken into account as part of the balance of convenience.

The court must assess whether it is just, in all the circumstances, that the claimant be confined to his remedy of damages. In Group M UK Ltd v Cabinet Office (2014) EWHC 3659 (TCC) Akenhead J held that it must be legitimate, when considering all interests likely to be harmed, to have regard to whether, if the lifting of the suspension were to be ordered, the claimant would be left with a remedy, “and that must include an effective remedy”. In that context a novel point arose. A claimant no longer has an automatic right to damages since the decision of the Supreme Court in Nuclear Decommissioning Agency v Energy Solutions EU Ltd [2017] UKSC 34. To what extent, if at all, can and should this be addressed when considering the adequacy of damages?  If a breach has to be “sufficiently serious” to qualify as satisfying the second Francovich condition, to give an entitlement to damages, how (if at all) is that to be taken into account when the court is faced with an application to lift the automatic suspension where adequacy of damages is a consideration?

This point was not fully argued before Fraser J on the Council’s application, and in the particular circumstances of this case it was not necessary for it to be fully argued. Both parties were agreed that at an interlocutory stage of a case – and in particular, at the interlocutory stage in this particular case on these particular facts – the court could not come to a decision on the question of whether the alleged breaches were or could be classified as “sufficiently serious”. Both parties were agreed that the point should be taken into account when considering the question of adequacy of damages as presenting an additional requirement which any claimant had to satisfy to recover damages at all.

The Council argued that because no procurement competition was conducted for the current supply of the services by the Trusts (even though a contract was entered into between the Council and the Trusts), then there are residuals doubts or concerns about the legality of the Council using the Trusts to continue to provide these services if the automatic suspension is not lifted. These doubts, which are essentially to the effect that the Council ought already to have conducted an open competition and are concerned that they did not do so, will only be magnified (or continued) if the Court leaves the automatic suspension in place. A different way of expressing this same concern is to state that the Council is extremely reluctant to operate the contractual option as that will continue the current unsatisfactory state of affairs.

Fraser J dealt with this point first. He said that there were a number of answers to it, and they all arrive at the same point, namely a conclusion that there is nothing in this argument. These included that continuing the existing current provision of the services by the Trusts for a short time pending a legal challenge to the procurement exercise, whilst the Council is under an automatic suspension imposed by the Regulations themselves, could be said to be a breach of the Regulations. This would be the case whether there was a contractual option within the existing contractual obligations which can be exercised or not. The suspension is imposed specifically by the Regulations if a claim form is issued within a particular period. Those same Regulations set out the circumstances in which that suspension can be lifted. If those circumstances, in any particular case, do not justify at law the lifting of the suspension, then the suspension must continue as a result of lawful operation of the Regulations themselves. Fraser J could not see how that can lead to a breach of the Regulations.

There was also a further point. It would be odd (to say the least) that if the Council were in breach of its legal obligations in awarding the existing contracts to the Trusts, it could rely upon its own breach in this respect and be in a stronger position concerning its application than if it had not been in breach of the Regulations in the first place.

Fraser J, at paragraph 37, rejected any submission that a failure to lift the automatic suspension would lead the Council to be acting unlawfully. There was an associated point. The Council argued that a failure to lift the suspension would mean that the Council had to continue in contractual relations with two Trusts with whom it was in litigation. That was the case, but again, Fraser J regarded this is a point of no import. He had no doubt that healthcare staff are sufficiently professional that a procurement dispute in the Technology and Construction Court in London would not affect the day to day provision of healthcare services to children in Lancashire, or the relations between the parties at operational level.

Fraser J’s analysis was that there was a serious issue to be tried. This therefore meant that the next steps in the process had to be addressed. The correct approach was firstly to decide the question of whether damages would be an adequate remedy.

Fraser J said, at paragraph 39:-

“39.      In my judgment, the fact that the incumbent providers of the Services are NHS Trusts is an important factor. Any incumbent provider of any service who is then unsuccessful in a procurement competition for those services will face inevitable reorganisation of its business as a result of that lack of success. Such reorganisation will (very often but not invariably) involve redundancies. However, here, the reorganisation is not just to the staff, or even in relation to the provision of Services to children. The evidence served for the Trusts makes it clear that the Trusts only recently restructured their operations to deliver these Services, and if they lose the procurement the Trusts will have significantly to restructure their operations a second time. This is a restructuring of delivery of healthcare across the population, and what are called “pathways” which are delivery routes through which healthcare is supplied. In addition to the cost and disruption that will cause – which I find would be considerable — the loss of the Contract will make it more difficult for the Trusts to deliver other similar public services which they are contracted to deliver, and these will require new pathways to care to be developed. All of this reorganisation is different to the staff situation, which in a sense is inevitable (or to put it another way, is an inevitable consequence for any incumbent bidder of having lost the bid). The impact upon the provision of healthcare as a whole to those in the catchment areas of the two Trusts is said to be considerable and I accept that.”

There would be a significant impact upon the operational activities of the two Trusts, and as a result, upon the quality of healthcare generally which they provide. Fraser J found that damages would not be an adequate remedy for the Trusts. This is the same result whether that question is considered first in isolation, or whether the same point is approached as an issue of the justness, in all the circumstances, of the Trusts being confined to their remedy of damages. The answer is one favourable to the Trusts on this application whichever way it is framed.

On the other hand, damages would be an adequate remedy to the Council. Given the very slim difference in the costs of provision of the Services by the Council compared to Virgin, the successful bidder, the financial differential would in any event either be small or non-existent. But even if that were not the case, the actual services would remain uninterrupted up to the date of the judgment in the proceedings, and there would be essentially an accountancy-type exercise to compare and compute the financial loss after a trial. That is an entirely different matter, and of a different nature, to the damage that would be caused to the Trusts were the suspension to be lifted and the Trusts succeed at trial.

Fraser J considered the inadequacy of damages to the Trusts to be conclusive on this application. Moreover the balance of convenience was overwhelmingly in the Trusts’ favour. The only point in the Council’s favour is its stated intention and preference to bring Virgin on board as soon as possible, together with the mobilisation period required by that provider. Given the nature of the Services, their subject matter, and the sector of the population for which they are provided (the children and young people of Lancashire) and the importance to the public interest of these Services, a desire by the Council to get on with the new contract (although entirely understandable) did not weigh much in the balance. Maintaining the suspension was a course that had “the least risk of injustice”. There will be no break at all in the provision of the Services as the Trusts will continue to provide them, and have undertaken to do so. The least risk of injustice was clearly to maintain the automatic suspension. The application by the Council to lift the automatic suspension therefore failed.

 

GPOC

February 8th, 2018 by James Goudie QC in Decision making and Contracts

The General Power of Competence (“GPOC”) in Section 1 of the Localism Act 2011 (“LA 2011”) and its exclusion, by Section 4 of LA 2011, when an authority is acting “for a commercial purpose”, but not through a limited company, has been considered in Peters v Haringey LBC (2018) EWHC 192 (Admin). The case is concerned with the Haringey Development Vehicle (“the HDV”).  The purpose of the HDV is to create a partnership, by way of a limited liability partnership (“LLP”), between the Defendant Council, and a private sector body, Lendlease, and to bring private sector finance, experience and expertise to the task of developing the Council’s land for its better use, and so achieving the Council’s strategic aims in housing, affordable housing and employment. The Claimant challenged by way of judicial review a decision made by the Council through its Cabinet, on 20 July 2017, to confirm Lendlease after a procurement process as the successful bidder to become the Council’s partner in the HDV, and also approved the structure of the HDV. Read more »

 

Legitimate Aim and Proportionality

February 1st, 2018 by James Goudie QC in Decision making and Contracts

On 29 January 2018 the Employment Appeal Tribunal (Sir Alan Wilkie) handed down Judgment in discrimination cases relating to the transitional provisions put in place by for example the London Fire and Emergency Planning Authority, under the Public Service Pensions Act 2013, as part of major changes to public sector pensions following the Hutton Report.

The EAT ruled that, in favouring those closer to retirement age, a legitimate social policy aim was being pursued that was capable of justifying direct discrimination. The EAT further ruled that an ET must make up its own mind as to whether the transitional provisions in support of that legitimate aim are proportionate having regard to their discretionary effect.  That is not a matter for a “margin of discretion”.

 

BIAS

January 15th, 2018 by James Goudie QC in Decision making and Contracts

R (Legard) v Kensington and Chelsea RLBC (2018) EWHC 32 (Admin) concerns the Council’s decision to permit a Neighbourhood Plan, for the designation of land as a Local Green Space, pursuant to paragraph 77 of the NPPF, to proceed to a Referendum.   The various grounds of complaint included allegations of apparent bias, breaches of the requirements of fairness, and ultra vires.

At paragraph 133, Dove J, having reviewed the authorities, distilled the principles that were particularly relevant to the considerations in the case before him:-

“…        The starting point must be a careful examination of all the facts before the court, and not simply those which would have been known to the claimant or a hypothetical onlooker. The test to be applied is whether a fair-minded and informed observer, having considered those facts, would conclude that there was a real possibility of bias on behalf of the decision-maker. The fair-minded observer should be neither unduly suspicious nor complacent. The fair-minded observer would need to be satisfied that the complaints made could be objectively justified as giving rise to a real possibility of bias. In addition, the fair-minded observer will take account of the overall context of the evidence in reaching a conclusion on the available facts. Part of that context will include, in relation to cases involving local government, that members of local authority are democratically accountable and will have political allegiances and policy positions. Thus, it has to be acknowledged that councillors may have a predisposition in relation to a particular decision, but that will not amount to predetermination provided they approach the decision with a mind which is willing to grasp all of the merits to be considered, and which is not closed to making a decision amounting to a departure from their predisposition. In a similar way, as part of the context of a case involving a government minister, the fair-minded observer will be taken to appreciate that ministers often have difficult and finely balanced decisions to take, and that it does not follow from a decision in favour of, for instance, a vocal body of local residents, that the minister was biased in their favour. Once an allegation of apparent bias has been made out, it is not obviated by the fact the apparent bias has had no operative effect upon the decision under challenge.”

On the other hand, in relation to allegations of unfairness, it is necessary for a claimant to establish not only that unfairness has occurred, but also that it has caused prejudice (paragraph 136).

Dove J further said:-

“142.     In seeking to form a view in relation to the question of whether or not the claimant has established that the defendant was apparently biased towards the second interested party, in my view it is necessary to have regard to the following features which would be part of the context known to the well informed and fair minded observer. Firstly, so far as the defendant’s officers are concerned, they are public officials who have a responsibility to seek to take account of legitimately expressed interests raised with them by the members of the public who they are employed to serve. It is part and parcel of their role to have a listening ear to representations that are made to them. Of course, from time to time there will be a necessity to turn representations away: they may be representations which are illegal or vexatious. There also may be the need from time to time, akin to the observations of the Court of Appeal in Broadview Energy Developments in respect of the conduct of the Secretary of State, to politely observe that there is no purpose in making further repetitious representations. Nonetheless, in the context of modern public administration there will be an expectation that Local Government officers will engage with representations which are made to them by all members of the public, since failing to do so may give rise to justifiable complaint.

  1. Secondly, in relation to members of the local authority, as is evident from authorities such as Lewis and Island Farm Development Limited, councillors are politicians and policy makers. As democratically elected representatives they are expected to receive and consider representations and lobbying from those interested in the issues they are determining. As Rix LJ observed in paragraph 96 of Lewis “[e]vidence of political affiliation or of the adoption of policies towards a planning proposal will not for these purposes by itself amount to an appearance of the real possibility of pre determination or what counts as bias”. As he went on to conclude, something more is required, in the sense of the local member having abandoned the obligation at the point of decision-making to address planning issues fairly and on their merits even though the member may have previously expressed a predisposition in relation to that decision.
  2. Thirdly, the well informed and fair minded observer would have an appreciation of the obligation of the defendant under paragraph 3(1) of Schedule 4B of the 1990 Act to “give such advice or assistance to [the second interested party] as, in all the circumstances, they consider appropriate for the purpose of, or in connection with, facilitating the making of proposals for [neighbourhood plans]”. Thus, the narrative of events, and in particular the defendant’s involvement in that narrative, would be understood by the well informed and fair minded observer as taking place against the backdrop of the requirement of the defendant to provide advice and assistance to the second interested party in order to facilitate the making of the Neighbourhood Plan. The duty is expressed in relatively broad terms, and in my view was undoubtedly included within the statutory provisions to reflect the fact that, firstly, the local planning authority would be well equipped with experienced professional officers to provide a range of expertise to support a qualifying body in the making of its Neighbourhood Plan and, secondly, to reflect the fact that many qualifying bodies would by stark contrast not have the resources or expertise available to them to produce a Neighbourhood Plan unassisted. That is not to say that there is anything in paragraph 3(1) which requires the local planning authority to support the proposals of a Neighbourhood Plan come what may, or whatever may be their views of the merits of the Neighbourhood Plan. It is obvious that the local planning authority has important tasks within the statutory framework in terms of appraising the merits of the Neighbourhood Plan against the specific tests which are set out in the legislation. The duty to provide “advice or assistance” does not require uncritical and unthinking support. What it does require, however, is undoubtedly relatively close engagement with the qualifying body to facilitate the making of the Neighbourhood Plan.
  3. I shall deal with the detail of the specific points of the claimant’s case individually below. Having carefully scrutinised the whole of the factual context set out above, together with those particular features highlighted by the claimant, I have reached the conclusion that there was neither apparent bias nor unfairness in the defendant’s involvement in the making of the Neighbourhood Plan, and in particular the proposal for the LGS designation of the site. …”

“175.     I have reached the conclusion, having considered the totality of the narrative of events in this case and all of the correspondence and documentation relevant to what occurred, that there is no substance in the contention of the claimant that the defendant was apparently biased toward the second interested party taking the overall context into account …”

“177.     … in essence the claimant relies upon points raised in relation to apparent bias in the context of fairness. For the reasons set out above, in my view the specific features of the case relied upon by the claimant are no more supportive of contentions in relation to fairness than they are to apparent bias. …”

“183. Overall, therefore, I do not consider that the procedure throughout the making of the Neighbourhood Plan up to the decision of the defendant to send the Neighbourhood Plan to referendum involved any unfairness to the claimant’s interests. In particular, at the key points of the decision-making process, namely the examination of the Neighbourhood Plan and the key decision following the receipt of the Examiner’s report, the claimant was afforded, and took, a full opportunity to engage in the merits of the proposal to designate the site as LGS and make their representations that this proposal was misconceived in planning terms.”

“195.     For the reasons which have been set out above, I am satisfied that the claimant has not made out any of the Grounds that have been raised in relation to the decision of the defendant under challenge, namely to pass the Neighbourhood Plan forward to referendum. Having considered the claimant’s arguments I have not been persuaded that there was any illegality in the decision which the defendant reached. This claim must therefore be dismissed.”

 

Legitimate Expectation

January 15th, 2018 by James Goudie QC in Decision making and Contracts

In Richborough Estates Ltd v SoS for CLG (2018) EWHC 33 (Admin) the Claimants challenged the Defendant’s decision to issue a Written Ministerial Statement (“WMS”) in relation to national planning policy concerned with housing and neighbourhood planning, together with a subsequent associated change to the National Planning Practice Guidance (“the PPG”).

In the Localism Act 2011 a new tier of the Development Plan was created by the extensive amendment of the Town and Country Planning Act 1990. Once made, a Neighbourhood Development Plan (“NDP”) forms part of the Development Plan for the purposes of Section 38(6) of the Planning and Compulsory Purchase Act 2004, which provides that determinations shall be “in accordance with the plan unless material considerations indicate otherwise”. The neighbourhood area, for which the plan is made, will be far smaller than the administrative area of the relevant local planning authority (“LPA”), and therefore the plan will be more locally focussed. Two features should be noted. Firstly, it is now well settled that the NDP can allocate land for development including housing and contain a policy determining a volume of development (such as houses) to be developed during the plan period. Secondly, specific provision is made for NDPs within the National Planning Policy Framework (“the Framework”).

Dove J observed that since the introduction of NDPs it is clear from the evidence before the Court that there are differing opinions as to whether they are a constructive part of the planning system. It is also clear that in introducing them the SoS has been of the view that they enable local communities to have a stronger and more effective say in the future development of their areas. A significant number of communities have taken the opportunity to make a NDP for the area in which they live and work. By contrast the extensive evidence from members of the housebuilding industry and their planning advisors which is before the Court contends that NDPs are being used to frustrate development and are not an effective mechanism for planning to meet housing requirements. That is not a debate which the Court can resolve. It is, however, the backdrop to the disputed policy which is the subject of the case.

One of the grounds of challenge was a contention that on the basis of regular past practice, there was a legitimate expectation that the SoS would consult the house building industry in relation to:

“a. any change to National Planning Policy for housing, or alternatively,

  1. any major change for National Policy for housing or, alternatively,
  2. any major change to the policy pertaining to five year housing supply in national policy.”

It was common ground that there was no statutory basis for any requirement that consultation should occur in relation to national planning policy for housing of the kind that, for instance, underpinned the decision of the Supreme Court in R (Moseley) v Haringey London Borough Council [2014] UKSC 56; [2014] 1 WLR 3947. As Lord Wilson JSC observed at paragraph 23 of his judgment a duty to consult can arise in a variety of ways including where it is generated by statute. In the present case it was contended by the Claimants that the duty to be consulted arises specifically as a consequence of the doctrine of legitimate expectation. This was a case in which the Claimants did not contend that the duty to consult arose on the freestanding basis of the requirements of fairness divorced from the operation of the doctrine of legitimate expectation. The Claimants’ argument was firmly pinned to a requirement for consultation based upon legitimate expectation derived from prior practice. The question of whether the requirements of fairness might be infringed by a change to national planning policy without public consultation does not arise for decision in the present case.

Dove J observed, at paragraph 64, that the starting point for considering this ground must be the requirements necessary to establish whether or not a legitimate expectation arises. The nature of a legitimate expectation was set out by Lord Fraser of Tullybelton in the case of CCSU v Minister for Civil Service [1985] 1 AC 374 at page 401A-F.  The principles which govern the doctrine of legitimate expectation were further considered by the Court of Appeal in the case of Bhatt Murphy v Independent Assessor [2008] EWCA Civ 755. Following the decision in CCSU the Court of Appeal had given further consideration to the principles of legitimate expectation in other cases, and these authorities were referred to by Laws LJ in setting out the principles pertaining to legitimate expectation in his judgment in Bhatt Murphy, where he distilled the legal principles.

Dove J continued:-

“66.      As is evident from Laws LJ’s decision it is necessary for there to be “an unequivocal assurance” either expressly or implicitly from practice upon which the legitimate expectation is then grounded. …

  1. It is the claimants’ contention that on every occasion when there have been changes to national planning policy in relation to housing in the past there has been consultation with the house building industry before that policy has been confirmed. Thus, they contend that as a consequence of that practice there was a legitimate expectation that they would be consulted about the written ministerial statement before it was issued by the defendant. They draw attention to the fact that the defendant was warned of a risk of legal action if he failed to consult, and further rely upon the discussions evidenced in the recent disclosure suggesting that there would be consultation on this policy change through the White Paper.
  2. The starting point for evaluating the claimants’ submissions must be the observation that the legitimate expectation which they rely upon and seek to frame is narrow in its scope. Firstly, as pleaded, it is restricted to consultation with the house building industry. It is in my view important to observe that the house building industry are not the only parties with an interest in the content of national planning policy for housing. LPAs, amenity groups and the public at large will all have a potential interest or concern in relation to any change in national planning policy for housing. In some respects they may have a different perspective from the house building industry, but that is no reason to exclude them from an entitlement to be consulted in relation to a change to national planning policy for housing. This observation is by no means fatal to the claimants’ case. Perhaps more felicitously expressed the legitimate expectation for which they might contend would be for public consultation in relation to changes to national planning policy for housing which would include, amongst others interests, the house building industry. Alternatively, the legitimate expectation claimed might be formulated as a requirement for consultation with the public at large in relation to any change to national planning policy for housing.
  3. The second observation in respect of the narrowness of the pleaded legitimate expectation is that it is limited to changes (or major changes) to national planning policy for housing. It is necessary for the claimants to limit the legitimate expectation in this way if they are to succeed. The necessity for that limitation arises because there is factual evidence before the court that there have been several occasions where national planning policy has been changed by the issuing of a WMS without there having been any consultation, whether with the house building industry or the public at large, at all. Instances of this include a WMS in respect of national retail planning policy related to the demonstration of need which was made on 11th February 1999. In more recent times, on 15th September 2015, a WMS adjusting national planning policy in relation to the approach to be taken to applications for exploratory apparatus for hydraulic fracturing was issued without any prior public consultation. Thus, there is no basis for the claimants to contend for a legitimate expectation that changes to national planning policy would not occur without prior consultation. There is a history (including two further episodes which are particularly pertinent to the claimants’ claim) of national policy being changed in specific respects from time to time though the issuing of a WMS.
  4. This creates in my view further troubling consequences for the legitimate expectation for which the claimants contend. The question which the claimants’ contention begs is why would a legitimate expectation of the kind they claim apply to national policy pertaining to housing but not to national policy pertaining to retail development or exploration for minerals and energy. The claimants’ response was to point to the specific importance of housing development in terms of providing people with a home (including an affordable home for those who required one), together with the importance to the national economy of the house building industry. Whilst those points are undoubtedly correct, they do not in my view coherently distinguish housing development from other forms of developments of undoubted significance to the economy and national wellbeing, such as developments concerned with retail or mineral exploration. I can see little if any basis to distinguish housing from any other national planning policy so as to contend, against the backdrop that the claimants cannot sustain a legitimate expectation in respect of national policy as a whole, that there may be a legitimate expectation in relation to planning policy for housing.
  5. However, it is not necessary to decide the case on this basis, albeit that it throws up significant evidential fragilities in relation to the claimants’ pleaded legitimate expectation. The defendant’s response to this part of the case draws attention to occasions when the defendant has issued a WMS concerning national housing policy without any prior consultation. The defendant thus contends that there is no evidential basis for the legitimate expectation contended for by the claimants.”

“75.      … on the facts, even confining the enquiry to national planning policy in relation to housing (and ignoring the difficulty of justifying why housing should be isolated from other forms of development in this respect), in my view the evidence does not establish that there has been an unequivocal assurance on the basis of practice that a WMS in relation to national planning policy for housing would not be issued without prior consultation. It is clear that on at least two occasions the defendant has issued WMS without consultation affecting national planning policy for housing. Thus I am unconvinced on the evidence that the claimants have established a legitimate expectation that they would be consulted on the WMS. …”

 

Contract Awards

January 2nd, 2018 by James Goudie QC in Decision making and Contracts

In MLS (Overseas) Ltd v SoS for Defence (2017) EWHC 3389 (TCC) O’Farrell J restated the principles as follows:-

(1)        Any procurement must be conducted in accordance with the obligations of (i) transparency. (ii) equality of treatment, (iii) procedural fairness, (iv) good administration, and (v) fairness: paragraphs 55 and 58;

(2)        Any decision is required to be (i) rational and (ii) free from manifest error: paragraph 58;

(3)        The principle of transparency is that the award criteria must be formulated in such a way as to allow all tenderers to interpret them in the same way: paragraph 59;

(4)        That requirement sets a legal standard: ibid;

(5)        The question is not whether it has been proved that all actual or potential tenderers had in fact interpreted the criteria in the same way;

(6)        The question is whether the Court considers that the criteria are “sufficiently clear” to permit of “uniform interpretation by all tenderers”: ibid;

(7)        The test is an objective one: paragraph 60;

(8)        It is based on –

(i)          an interpretation of the relevant documents,

(ii)        taking account of all the circumstances of the particular case: ibid;

(9)        Contracting authorities cannot ask “clarification” questions that involve “negotiation” –

(i)          with any tenderer on a confidential basis, or

(ii)        that unduly favour, or disadvantage, the tenderer to whom the clarification is addressed: paragraph 61;

(10)      However, that does not preclude the (i) correction, or (ii) amplification of details of a tender, where appropriate, “on an exceptional basis” particularly when it is clear that “such amendment does not in reality lead to the submission of a new tender”: ibid;

(11)      A contracting authority must comply with the decision-making procedure set out in the procurement documents: paragraph 62;

(12)      The Court will not substitute its own decision for that of the contracting authority: paragraph 63;

(13)      Provided that the obligations of transparency and equal treatment have been satisfied, the Court will interfere with the decision of a contracting authority only where there has been a “manifest error”, such as where –

(i)          there has been a failure to consider all relevant matters,

(ii)         there has been consideration of irrelevant matters, or

(iii)        the decision is “irrational”, in that “it is outside the range of reasonable conclusions open to it”: ibid.

 

Consultation

December 21st, 2017 by James Goudie QC in Decision making and Contracts

In R (Hutchison 3G UK Ltd) v Telefonica UK Ltd (2017) EWHC 3376 (Admin) Green J said:-

“238.   In my judgment the Sedley criteria are not hard and fast rules that can be mechanistically applied so as to lead to a rigid and certain result. They are lodestars guiding the overall assessment that must be made of the facts to see whether addressees of a consultation had, in a real and practical sense, been accorded a fair opportunity to express their views and opinions. The Sedley criteria, by their nature, are not capable of serving as definitive rules; they amount to four broad tests to be applied to the facts of each case. They concern: (i) the point in time at which the consultation must occur; (ii) the sufficiency of the reasons enabling the addressee to understand how to respond; (iii) the sufficiency of the time granted to enable proper responses; and (iv), the taking into account of the facts and matters submitted by consultees. The ultimate litmus test is simply fairness; so how the application of the criteria play out in a particular case will depend upon all of the surrounding circumstances.

  1. And importantly the criteria do not do away with the requirement of materiality which indicates that for a breach of the criteria to be dispositive that breach must make an actual difference to fairness. If the consultation is fair notwithstanding non-observance with one or more of the criteria, then it will be non-material and the consultation will remain fair.”

 

Overview and Scrutiny

December 15th, 2017 by James Goudie QC in Decision making and Contracts

The House of Commons Overview and Scrutiny Committee has issued a Report on the “Effectiveness of local authority overview and scrutiny committees”, which proposes revisions to Government Guidance on such committees and makes recommendations.

 

Recitals and interpretation of contracts

December 12th, 2017 by James Goudie QC in Decision making and Contracts

In Attorney General v River Dorée Holdings Ltd, concerned with a Lease, the Privy Council stated as follows, (2017) UKPC 39.

A recital may in appropriate circumstances serve as background or an introduction informing or assisting the interpretation of a substantive provision in the contract. But the two must at least be capable of being read consistently. No ambiguity can be created from a mere recital which cannot consistently be read together with the substantive and operative parts of the contract concerned. (Paragraph 48).

It is not for any Court to remake the contract of the parties under the guise of interpretation. (Paragraph 51).

Negotiations are not admissible for the purpose of interpretation. (Ibid).

It is significant if there is no claim for rectification, as there might be if there is good evidence available that an interpretation contended for had in fact been the prior agreement of the parties during negotiations and that such agreement had been in existence down to the execution of the contract. (Paragraph 55).