Bristol Missing Link Ltd v Bristol City Council

Introduction

In these proceedings, the claimant, Bristol Missing Link Ltd (“BMLL”), challenges the procurement of a significant contract for domestic violence and abuse support services in Bristol. The challenge is made under the Public Contracts Regulations 2006 (“the Regulations”). The defendant, Bristol City Council (“the Council”) wishes to award the contract to another tenderer, Refuge.

Because of the challenge, Regulation 47G(1) imposed an automatic stay and prevented the Council from entering into the proposed contract with Refuge. By an application made on 27 February 2015, pursuant to Regulation 47H, the Council sought to lift that automatic stay. The hearing of that application took place on 26 March. At the end of that hearing, I told the parties that the automatic stay would remain in place until the conclusion of the expedited trial in June of this year. I said I would provide my detailed reasons for that decision in writing.

The Factual Background and the Claim

Background

On 8 July 2014 the Council issued an invitation to tender for the award of a contract entitled ‘Bristol City Council Domestic Violence and Abuse Support Service’. The invitation stipulated a tender return date of 6 October 2014. The contract was to be awarded for a three year period starting on 1 April 2015, with an option to extend for a further two years. It also explained that the tender evaluation would be carried out in two stages. Stage one involved questions to ensure that the tenderers met the Council’s minimum requirements. Stage two was an evaluation of the tenders according to the evaluation criteria.

There was an 80/20 split in the weighting of the award criteria between Quality and Price respectively. In respect of Quality, the principal element was Service Delivery, which was worth 70% of the Quality component of the score, and which was itself subdivided into eight, separately weighted sub-criteria. The evaluation was subject to a scoring matrix where individual scores were to be awarded for each sub-criteria, on a scale of 0-5.

BMLL are the incumbent providers of this important service to the Council. They submitted a tender by the due deadline. The Council received two other tenders, including one from Refuge. The other tenderer did not get past stage one and can be discounted for present purposes. Although the Council said that they would inform the tenderers of the result of the competition in early December 2014, it was not until 8 January 2015 that BMLL were informed that their tender had been unsuccessful. At the same time, Refuge were told that their tender had been successful.

There then followed detailed correspondence, first between BMLL and the Council, and then through BMLL’s solicitors, in which BMLL’s unhappiness with the result, and their concerns over the tender evaluation process, were debated. One feature of that correspondence, to which I shall return in a moment, was BMLL’s repeated attempts to see the material relating to the evaluation of Refuge’s tender. Although BMLL offered that these documents would be disclosed into a confidentiality ring, the Council refused to provide copies of Refuge’s tender, and the primary evaluation documents relating to that tender. The Council did, however, provide certain information relating to the evaluation of BMLL’s tender.

On 5 February 2015, as a result of the failure to resolve the issues between the parties, and in the light of the strict timetable provided by the Regulations, BMLL commenced these proceedings. Their detailed particulars of claim were served on 12 February 2015. The Council provided a defence on 4 March 2015. By then, the Council had made this application to lift the automatic suspension.

Claim

The claim made by BMLL divides into two, connecting parts. The first allegation (paragraphs 40-41 of the Particulars of Claim) complains that their scores were subsequently adjusted downwards from the individual scores produced by the five members of the evaluation panel, as part of a subsequent moderation process. Paragraph 41 states:

“It is averred that after the final tenders were open, and after evaluators had scored the claimant’s tender, the defendant systematically adjusted downwards the scores awarded to the claimant’s tender in respect of a number of responses. In each instance, the adjusted score was below the score awarded by all/or a clear majority of the evaluators. In so doing, the defendant breached its duties of equal treatment and transparency. No proper explanation or documents have been provided by the defendant in respect of this process. The claimant will seek full particulars and disclosure of all relevant documents regarding each such adjustment.”

Some of the documents that have been voluntarily disclosed by the Council go to this issue. Thus, for example, we know that BMLL’s tender on sub-criteria 2.5 was the subject of scores from the individual evaluators of 4, 4, 4, 4, 4 and 3. These were subsequently moderated to an overall score of 3, but no explanation for that result has been provided. Similarly, BMLL’s tender for sub-criteria 2.7, with individual evaluation scores of 4, 4, 5, 4 and 3, was also given an overall score of 3, but again no explanation for that reduction has been provided.

In response to this allegation, paragraph 26 of the Council’s defence averred as follows:

“As to paragraph 40 and 41, it is admitted that as part of the moderation of the scores initially attributed by individual members of the evaluation panel, the various scores of all tenderers were discussed and ‘moderated’ with a final score for each award criterion for each tenderer being agreed by the evaluation panel as a whole. In so far as this may have involved the ‘adjustment’ of any particular score, it is averred this was a wholly lawful way of conducting the evaluation process and one that is routinely adopted by evaluation panels consisting of more than one individual evaluator. Save as aforesaid, paragraph 40 and 41 are denied. It is specifically denied that the defendant was in breach of its duties of equal treatment and transparency.”

That is the extent of the pleaded response on the moderation issue. Unsurprisingly, therefore, BMLL complain that the Council has not engaged with the detail of their complaint. That is a point to which I will return, when I deal with the Council’s submission that there is no serious issue to be tried.

The second element of the claim made by BMLL focuses on the individual scores awarded for each sub-criteria. The criticisms are put in two ways. First, there is a criticism of the score awarded to BMLL by reference to the Council’s own tender evaluation criterion. A point made by BMLL is that they were repeatedly awarded a score of 3, which is the maximum that could be awarded, unless the tenderer could show that it was adding value and exceeding the contract specification. BMLL maintain that, for 6 out of the 11 sub-criteria, they were awarded a score of 3, when their tender (on their case) plainly exceeded the contract specification for each item, and should therefore have been awarded at least a score of 4.

Thus, by way of example, paragraph 49 of the Particulars of Claim deals with sub-criteria 2.2. The pleading is in the following terms:

“The Defendant purported to score the Claimant’s response at 3/5. On a proper and lawful application of the published award criterion the Claimant’s response required a score of at least 4/5. In the absence of any proper account of the reasons on which the Defendant purports to justify the score awarded, the Claimant provides herein the best particulars currently available. As expressly admitted in the Defendant’s letter of 14 December 2014, the Claimant’s response satisfied all of the contract specification requirements. However, the Claimant’s response also exceeded the contract specification requirements/added value so as require a score of 5/5, or at the very least 4/5. Without prejudice to the foregoing, it is averred that the Claimant’s response provided for: (a) clinical supervision by a qualified therapist, (b) worker specialisms, including specialist crisis workers, a complex needs worker and BME support workers, (c) a separately funded volunteer coordinator and volunteers, (d) 3 publicly accessible offices in locations offering convenient access for service users, (e) AQS Accreditation, and (f) AQA training provision. Further, the Defendant’s own evaluation documents record that the Claimant’s response was scored by evaluators at 4/5, before being adjusted downwards. The Defendant has yet to provide any proper particulars or disclosure regarding the downward adjustment of the Claimant’s score.”

The response to this can be found at paragraph 31 of the defence. The Council pleads in response to this detailed allegation in the following terms (which are repeated verbatim for each item):

“As to paragraphs 49 – 53, it is specifically denied that the Claimant’s response to this question required any score above the 3/5 which it was attributed. In any event, the score attributed to this response was one which the evaluation panel was fully entitled to award on the basis of the tender information submitted to it. It is specifically denied that the evaluation panel applied any undisclosed award criteria, misdirected itself in any way or committed any manifest error of assessment in the evaluation of the Claimant’s tender.”

Again, BMLL complain that, by this defence, the Council has wholly failed to engage with the detail of their criticism of the individual scores that they were awarded.

Secondly, there is the criticism made by BMLL of the evaluation process in respect of the evaluation of the Refuge tender. I should say that I regard this as very much a secondary part of BMLL’s case. In these sorts of disputes, the primary focus must always be on the evaluation of the claimant’s tender. Clear errors that can be proved in the evaluation of the successful bid may be of relevance, but they unlikely to be determinative of the key issues between the parties.

The Correct Approach

The courts have regularly stated that the approach to be adopted by the court when determining an application to lift the automatic suspension is essentially the same as the test as to whether or not to impose an interim injunction, adopting the principles in American Cyanamid Co v Ethicon Ltd (No. 1) [1975] AC 396. Early procurement disputes made that clear: see for example Exel Europe Ltd v University Hospital Coventry and Warwickshire NHS Trust [2010] EWHC 3332 (TCC) and The Halo Trust v Secretary of State for International Development [2011] EWHC 87 (TCC). More recently, there has been a suggestion that, because the Regulations are based on EU law, and because of the importance ascribed by EU law to fairness and transparency in the tender process for public contracts and the importance of the remedy of review, a different set of principles were applicable.

However, that approach has been expressly rejected by the courts: see NATS (Services) Ltd v Gatwick Airport Ltd and Another [2014] EWHC 3133 (TCC); and Group M UK Ltd v Cabinet Office [2014] EWHC 3659 (TCC); [2015] 1 CMLR 43. Furthermore, if there was any lingering doubt about it, the American Cyanamid test was expressly adopted by the Court of Appeal in the procurement case of DWF LLP v Secretary of State for Business Innovation and Skills [2014] EWCA Civ. 900.

That is not to say that the importance ascribed by the EU to the remedy available to an unsuccessful tenderer, to challenge the order for contract, is irrelevant. As discussed below, there is clear authority for the proposition that it is a matter to be taken into account when testing the balance of convenience.

Accordingly, in Section 5 below, I deal with whether or not there is a serious issue to be tried, and in Sections 6 to 9 below, I deal with the various aspects of the case relevant to the balance of convenience. However, before embarking on that analysis, there is an important point to be made about disclosure.

Disclosure

Disclosure in procurement disputes is a perennial problem. On the one hand, an unsuccessful tenderer, whose knowledge of the proposed contract will often be detailed (particularly if, as here, he is the incumbent contractor), may feel instinctively that something has gone wrong in the tender evaluation process. But it can be difficult for him to obtain any information to back up that concern, beyond the sometimes scanty material supplied by the contracting authority (“the authority”) pursuant to the Regulations. Any application for early disclosure may often be dismissed as a ‘fishing’ exercise. There is a real risk that, in such circumstances, there is an unlevel playing field, and the unsuccessful tenderer may never obtain the information he requires to mount a claim.

On the other hand, I quite see that the authority may wish to stand on his rights and refuse all requests for early disclosure, in part because of the confidential nature of the information (although that can usually be dealt with by way of a confidentiality ring), in part because of the time-consuming and expensive business of dealing with such requests, and in part because the authority may feel – often with good cause – that the unsuccessful tenderer will never be satisfied with the answers provided, and will always be seeking just one more document.

It is a question of balancing the interests of justice against the background facts of the particular case. Contracting authorities have to work out, in fairly short order, whether, having provided the unsuccessful tenderer with the statutory minimum information, they are going to retain all other documents relating to the evaluation and the successful tenderer’s bid, and let the unsuccessful tenderer take his own course; or whether they are prepared to be helpful and, providing that the confidentiality of the information is protected, offer to provide as much information about the process as they can. In my view, however, what the authority should not do is to try and have it both ways. It ought not to refuse requests to provide documents relating, say, to the evaluation of the successful tenderer’s bid, or the bid itself, but then, on the application to lift the suspension, provide for the first time evidence about the process or the successful bid in support of its case, either that there is no serious issue to be tried, or that he would be prejudiced if the suspension was not lifted. That approach is at least potentially unfair, because it is relying on potentially controversial material which the unsuccessful tenderer has been given no proper opportunity to consider.

There is support for this proposition in the decision of Akenhead J in Pearson Driving Assessments Ltd v The Minister for the Cabinet and another [2013] EWHC 2082 (TCC), a case concerned with pre-action disclosure. There the judge said this:

“14.

All these are assertions of fact and it does seem to me (and it is at least partly if not entirely acknowledged by Mr Bowsher QC for the defendant), that whether or not what Mr Carter says factually is true, at least to the extent that it is not supported by contemporaneous documentation; or to the extent that it is uncontroversial as between the parties to these proceedings, there can be no reliance on it as such to justify an argument that there is not a serious issue to tried at least so far as LD’s financial standing is concerned. That, it seems to me, was the proper concession to make.

15.

The court, on the application of Section 47 (H), will simply not be in a position to find facts which are controversial or at the very least, which are not supported clearly by uncontroversial, contemporaneous documentation. Therefore, insofar as there is reliance by the defendants on those sorts of facts, those are facts which cannot properly be deployed as grounds for deciding that there is no serious issue to be tried.”

I rely on those observations to conclude that controversial material, and/or material which, because of the absence of prior disclosure, the claimant is simply not in a position to address satisfactorily if it is produced for an interlocutory hearing, should not ordinarily be deployed on an application under Regulation 47(H), because of the risk of unfairness. I consider that, in this case, the Council has sought a potentially unfair advantage through its attitude to disclosure. There are two reasons for that.

First, their solicitor Ms Nugent purports to give evidence as to how the Refuge tender was evaluated (even though she was not involved in this process). She does this by reference to documents which were sought by BMLL but the disclosure of which was refused.

As it happens, BMLL were able to download from the Council’s website a document which appeared to be the Council’s evaluation of the Refuge bid. The Council have complained that this document has been wrongly obtained by BMLL, but I find the evidence on that unpersuasive. It is much more likely that this document was wrongly downloaded by a Council employee to this particular part of the website, so that it could then be accessed by others, including BMLL. A Council’s inability to use its own website facilities properly is hardly unusual.

But now, in order to argue that BMLL do not raise a serious issue, the Council have disclosed a detailed scoring sheet for Refuge that is in a different and fuller form to the one BMLL downloaded from their website in January. As Ms Metters of BMLL says at paragraph 41 of her statement:

“No explanation was provided as to why it was suddenly felt appropriate to disclose that document where previously it had been withheld. This document has caused us further concern about unequal treatment because it shows that many points of criticism about Refuge’s bid were taken out of the feedback that was apparently given to them with their standstill letter, potentially to justify the high scores that were awarded.”

I regard it as potentially unfair for the Council to pick and choose what documents they provide and when, as it suits them.

Worse still in my view is the copious evidence in the witness statements of Mr Anderson (a Service manager with the Council) and Ms Nugent, which seeks to extol the virtues of the Refuge tender itself. This is done in order to persuade the court that there would be prejudice to the Council and the service users if the suspension was not lifted and the contract with Refuge was delayed. But it is difficult for BMLL to respond in any detail to such material, when it was not provided when they asked for it. Moreover that problem is compounded here because the evidence consists of a series of assertions based on what it is said is in the Refuge tender, as opposed to the specifics of the tender itself (which has still not been disclosed).

It is against that unfortunate background on disclosure that I go on to consider, first, whether there is a serious issue to be tried in this case and, if so, whether the balance of convenience is in favour of lifting or retaining the automatic suspension.

Serious Issue to be Tried

The Law

Often, in a suspension/injunction dispute in a procurement case, the contracting authority will accept that there was a serious issue to be tried. Indeed, in the ordinary case, such an acceptance might be thought to be consistent with the absence of documentation: the authority taking the view that it was not obliged to (and so would not) disclose the underlying documents, but that, in consequence, it would not suggest that there was not a serious issue to be tried. But sometimes, perhaps encouraged by cases like Group M, authorities have argued that the claimant’s case is hopeless, so there is no serious issue to be tried. This has required the judge to undertake a detailed analysis of the merits or otherwise of the pleaded case in order to reach a view on this first element of the American Cyanamid test.

I am not sure that this is something which should be happening quite as often as it is. Of course I accept that there will be cases where even a brief analysis will demonstrate that the claim is very weak, or even impossible to sustain. Group M was such a case. It was possible there for the judge to reach such a conclusion because the claimant’s argument was that the defendant had misconstrued their own instructions to tenderers, and had accepted a tender that was unsustainable. Perhaps unsurprisingly, Akenhead J gave such a contention short shrift and found that, in consequence, there was no serious issue to be tried.

But in the ordinary procurement case, where there may be points to be made on both sides, it will often be unproductive for the parties (and a waste of judicial resources) to spend a good deal of time arguing about the merits or otherwise of the underlying claim. The threshold is, after all, a low one: see The Newcastle upon Tyne NHS Foundation Trust v Newcastle Primary Care Trust [2012] EWHC 2093 (QB). In Solent NHS Trust v Hampshire County Council [2015] EWHC 457 (TCC), Akenhead J analysed a similar argument to that advanced before me in this way:

“13.

Mr Barrett, clearly with some reluctance, accepted that there was a serious issue to be tried overall, primarily on the basis that disclosure had yet to take place. He however sought to argue (in the context of the balance of convenience) that the liability case pleaded against HCC was very much at the weak end of the spectrum. Ms Hannaford QC sought to argue that her client’s case was at the strong end of the spectrum.

14.

Mr Barrett took the Court by way of example to the pleaded complaints about inadequate marking in relation to Questions 6, 7 and 9, saying that when one looks at the answers provided by Solent they are unspecific, general and, often, not an answer to the specified question. Ms Hannaford QC however sought to persuade me otherwise. Whilst one can see, simply from the wording used by Solent that, superficially at least, the answers are not immensely informative, it would be invidious for the Court at this stage to form a concluded view that the answers are or are not so uninformative and non-responsive to the individual questions that it can be said that the pleaded case in relation to these answers to questions is weak or indeed strong. The Court has only the written answers and they would probably need to be looked at in the context in which they were written as well as in the light of the specification and indeed the word count limitation imposed by the ITT. The Court might be helped ultimately by comparing at least Inclusion's answers; if, for instance, its relevant answers are obviously more informative and responsive than Solent's (or not), that might enable a view to be formed as to the scores awarded. The Court is simply not in a position at this stage to say with any confidence that the case on breach is strong or weak.

15.

The only exception to this is the pleaded case that Inclusion’s tender should have been rejected because it secured a 0% mark on Price and Cost. Without finally deciding the point, this would seem to be a very weak complaint given the express wording of Paragraph 5.4.1 that HCC “reserve[d] the right not to proceed any further with the tender” which strongly suggests that it had retained a discretion either to proceed or not to proceed with a tenderer whose tender had secured such a mark. However, even if that element of the Claim is weak, there remains a serious issue to be tried on the complaints about the marking. There was much discussion before the Court about that the criteria to be applied in relation to complaints about marking. There is some authority which suggests that, provided that the marking is not irrational or not such as no reasonable authority could have given, the Court should not find a breach of the Regulations and that, provided that the marking is within the range of what authorities might reasonably have awarded, the Court will not interfere. That may well all be correct but, as indicated above, the Court is not in a position on the limited written evidence to assess the relative strengths and weaknesses of the complaints of breach.”

In my view, those passages make clear two things: first that, in cases where there are clear issues arising out of individual scores, it will be difficult for the court to conclude that there is no serious issue to be tried; and, second, that this difficulty arises, at least in part, because the relevant documents have yet to be disclosed.

Analysis of the Present Case

It was the Council’s firm submission that BMLL’s claims were hopeless and did not raise a serious issue. For the reasons that I have set out in Section 5.1 above, I consider that it is an onerous task to make good such a submission on an application of this kind. For the reasons set out below, I find that the Council have failed to make good that submission. On the contrary, I consider that, for the same reasons identified by Akenhead J in Solent, this is a claim that is neither obviously weak nor obviously strong, but which plainly raises a serious issue to be tried.

Difficulties with the Council’s stance

In my view, the Council have a number of difficulties in mounting this attack on BMLL’s claim. The first is that, in their pleading, they have failed to engage with the detail of the BMLL claim: see the points at paragraphs 8-15 above. This meant that, during his comprehensive submissions, Mr Williams QC was obliged instead to go through some of the correspondence after 8 January 2015, in order to explain the Council’s position. It was not clear why these responses had not been pleaded, and their accuracy or correctness was not confirmed in any witness statement. On analysis, it was demonstrated to my satisfaction that many important matters raised in their pleaded claim by BMLL had not been answered at all.

The second difficulty concerns the absence of any evidence from those involved in the tender evaluation process. The Council’s principal evidence came from Mr Anderson, the Crime and Substance Misuse Service Manager, and the solicitor Ms Nugent. Neither of them had any involvement at all in the process; certainly their statements do not suggest otherwise. There were five evaluators, and a sixth person who was named and described as a procurement specialist, who was giving advice and guidance to the Council. Surprisingly, there is no evidence from her. The names of four of the five evaluators have been redacted from the documents and, although their identities have thereby been protected, there is no evidence from them either. There is evidence from Ms Griffiths, the fifth evaluator, but her statement was short, and was only provided in reply to the evidence from Ms Metters. There has been no explanation as to why those actually involved in the process have not given evidence.

This is not just a matter of form. In particular, I note that in the Council’s letter of 2 February 2015, they say this:

“There were a number of instances whereby the panel members had not marked the bid in accordance with the advertised criteria. Had the moderation process not have taken place, and a mere average or median of the individual marks awarded, we would have been scoring according to incorrect criteria and would have left ourselves open to a legitimate challenge from an aggrieved bidder.”

I agree with Mr Coppel QC that this is a potentially important admission. First, it suggests that the original evaluation process may have been flawed. Secondly, it highlights the importance of the subsequent moderation exercise. But that particular part of the evaluation process is something which, on the evidence provided by the Council, remains unexplained.

In my view these general difficulties, coupled with the disclosure issue addressed in Section 4 above, make it rather surprising that the Council considered that it was even arguable that there was no serious issue to be tried. An analysis of the individual heads of claim only supports that view.

Moderation

Mr Williams QC argued that BMLL were attacking the principle of moderation, which he said was illegitimate: moderation was an accepted element of the procurement process. He relied on the EU case of Europaiki Dynamiki v EMSA [2010] ECR 11-313 to argue that, not only was moderation an appropriate exercise, but that all that mattered was the final scores awarded as a result of that process. Mr Coppel QC, on behalf of BMLL agreed that moderation was an appropriate part of the evaluation process, but submitted that what mattered here was the way in which it was carried out. He criticised the apparent anomalies produced by the moderation in this case and the absence of any explanation for them.

In my view, BMLL have demonstrated a serious issue to be tried in respect of the moderation exercise. Whilst I accept that the case of Europaiki confirms (unsurprisingly) the legitimacy of a moderation process in principle, it is dealing with a point that does not arise here: an unsuccessful tenderer’s reliance on certain comments on the individual evaluation sheets, whilst at the same time ignoring the composite opinion produced as a result of the subsequent moderation process. That is not BMLL’s complaint here: on the contrary, they are criticising the way in which the moderation exercise itself was performed.

Furthermore, there are other authorities which also suggest that BMLL’s complaints about the moderation process in this case give rise to a triable issue. For example, DWF was a case in which complaints were made about the way the moderation process was conducted. Paragraph 49 of the judgment of Sir Robin Jacob states that those complaints were arguable for the purposes of an interim injunction application. Moreover, in the Northern Ireland case of Resource (NI) v Northern Ireland Courts and Tribunals Service [2011] NIQB 121, McCloskey J said at paragraph 35:

“…I interpose here the observation that, under the current statutory and jurisprudential regime, meetings of contract procurement evaluation panels are something considerably greater than merely formal events. They are solemn exercises of critical importance to economic operators and the public and must be designed, constructed and transacted in such a manner to ensure that full effect is given to the overarching procurement rules and principles. Where, in any given case, a disappointed bidder’s legal challenge focuses on the activities and deliberations of an evaluation panel, the evidence bearing thereon will, inevitably, be carefully and objectively scrutinised by the court. Any failure by the court to scrutinise with particular care the contents of relevant individual and collective marking frames would be in dereliction of the judicial duty.”

In the present case, there was a vital moderation meeting about which the court has no evidence at all. In consequence of that moderation meeting, the higher scores that the individual evaluators had awarded to BMLL were reduced. There is no explanation as to why, save for an admission by the Council that the original evaluators may have failed to apply the correct criteria first time round.

In the light of these matters, it seems to me self-evident that a serious issue has been raised in respect of the moderation exercise. As Mr Coppel QC reminded me, there was only a difference of 4 points between the score for the BMLL tender and the score for the Refuge tender. BMLL’s scores were reduced by more than 4 points at the moderation meeting. On that analysis, the whole case could be said to turn on what BMLL say was the unjustified reduction in their original scores as a result of that moderation meeting. In my view, this all gives rise to a serious issue to be tried.

Individual Scores

As to the second part of the claim, I have noted above that BMLL’s complaint is that, in respect of many of the individual scores, their tender provided added value and therefore justified a score of at least 4 in accordance with the evaluation criterion, as opposed to the score of 3, which simply indicated compliance with the contract but no more. The Council have made an attempt to reply to these allegations in the correspondence, and in some of the secondary documents that they prepared for the purposes of that correspondence. But as I have said, those responses are not in evidence and have not been pleaded. It leaves the Council’s case in a slightly odd state.

However, even assuming that the Council had provided detailed responses to some if not all of those points, I consider that there remains a serious issue to be tried which the court could not possibly resolve on an interlocutory basis. In order to decide this aspect of the claim, it will be necessary to consider the proposed contract specification, to see whether or not what BMLL was offering was indeed an enhancement. Whilst, in order to succeed, BMLL will need to show that the errors were clear, that does not mean that the court can decide these points of detail without hearing at least some evidence.

Accordingly, it seems to me that in respect of the individual scores, there is also a triable issue. The passages from Solent (paragraph 33 above) are directly in point.

The Balance of Convenience

In my view, there are four elements of the balance of convenience that need to be considered on an application of this kind. They are:

The Adequacy of Damages

The Law

In Covanta Energy Ltd v Merseyside Waste Disposal Authority [2013] EWHC 2922 (TCC) at paragraphs 39-48, I dealt with and summarised the relevant authorities dealing with the adequacy of damages in the procurement context. In NATS (Services) Ltd v Gatwick Airport Ltd and another [2014] EWHC 3133 (TCC) Ramsey J adopted that summary. At paragraph 48 of my judgment in Covanta, I said this:

“Accordingly, I would summarise the relevant principles concerning the adequacy of damages as follows:

(a)

If damages are an adequate remedy, that will normally be sufficient to defeat an application for an interim injunction, but that will not always be so (American Cyanamid, Fellowes [1976] 1 QB 122 CA, National Bank [2009] 1 WLR 1405);

(b)

In more recent times, the simple concept of the adequacy of damages has been modified at least to an extent, so that the court must assess whether it is just, in all the circumstances, that the claimant be confined to his remedy of damages (as in Evans Marshall [1973] 1 WLR 349 and the passage [paragraph 27/005] from Chitty on Contracts, 31^st Edition);

(c)

If damages are difficult to assess, or if they involve a speculative ascertainment of the value of a loss of a chance, then that may not be sufficient to prevent an interim injunction (Araci [2011] EWCA Civ 668);

(d)

In procurement cases, the availability of a remedy of review before the contract was entered into, is not relevant to the issue as to the adequacy of damages, although it is relevant to the balance of convenience (Morrisons [2010] EWHC 487 (Ch)).

(e)

There are a number of procurement cases in which the difficulty of assessing damages based on the loss of a chance and the speculative or ‘discounted’ nature of the ascertainment, has been a factor which the court has taken into account in concluding that damages would not be an adequate remedy (Letting International, Morrisons, Alstom [2010] EWHC 2747 (Ch), Indigo Services [2010] EWHC 3237 (QB), and Metropolitan Resources [2011] EWHC 1186 (Ch)). There are also cases where, on the facts, damages have been held to be an adequate remedy and the injunction therefore refused (European Dynamics [2009] EWHC 3419 (TCC), Exel.”

Application to the Present Case: BMLL

For the reasons set out below, I consider that damages would not an adequate remedy for BMLL. Moreover, the particular circumstances of this case mean that, if the suspension is lifted, there is a serious risk of injustice, because that would be the effective end of BMLL’s entire claim.

BMLL is not a profit-making organisation. They included no amount for profit in their tender, unlike the claimant in Solent. Since damages in cases of this kind usually reflect the unsuccessful tenderer’s loss of profit, it means that, if the suspension was lifted, BMLL would have no claim for anything other than nominal damages.

Mr Williams QC sought to argue that there was a reference to 1% being included in the tender as a contribution to overheads, but as Mr Coppel QC pointed out, the 1% contribution was included out of prudence, because BMLL are a non-profit making organisation and need to ascribe something in their tender for overheads. He argued that this could not be equated to profit. I accept that submission.

However, even if I were wrong about that, and it could be said that the 1% was recoverable as damages, it seems to me that that minimal figure is something which the court can take into account when considering, in real terms, whether damages are an adequate remedy. Mr Williams QC relied on the suggestion in paragraph 48 of the judgment of Akenhead J in Exel that the amount of damages recoverable was immaterial. However, in my view it is not quite as simple as that.

What matters is the adequacy of the remedy. In my view, that gives rise to wider considerations of justice. That is the point at paragraph 48(b) of Covanta (paragraph 49 above). In addition, I note that, in the interim injunction case of AB v CD [2015] 1 WLR 771, the contract in question had a clause which limited significantly the recoverability of damages. Laws LJ said at paragraph 27:

“The rule—if “rule” is the right word—that an injunction should not be granted where damages would be an adequate remedy should be applied in a way which reflects the substantial justice of the situation.”

I respectfully agree with that. Whilst Mr Williams QC was right to say that that was a situation where there was an ongoing contract, which is obviously not this case (as things stand), that does not seem to me to detract from the principle to be applied. In my view, a non-profit making organisation, which has bid for a contract making no allowance for profit at all, and a minimal amount for overheads, is entitled to say that, in such circumstances, damages would not be an adequate remedy.

Other Consequences

I accept BMLL’s case on the evidence that the lifting of the suspension would have other catastrophic consequences for them. In short, these consequences are as follows:

On this last point, Mr Williams QC relied on Solent to suggest that claims for reputational harm were of little consequence where the claim was linked to the unsuccessful attempt to obtain the contract in the first place. But I accept Mr Coppel QC’s submission that, in this case, the reputational damage arises from BMLL’s inability to do their core work in their only market, rather than their failure to win the contract per se.

I have cited various references from Ms Metters’ statement. I note that, although there is a statement in response from Ms Griffiths, she does not seek to challenge or put in issue any of the matters which I have summarised above from Ms Metters’ statement. To that extent, therefore, it could be said that the catastrophic consequences of lifting the suspension for BMLL, none of which seem to me to be capable of compensation by way of damages, are not in dispute.

For the reasons set out above, I do not consider that damages are an adequate remedy for BMLL in this case.

Application to the Present Case: The Council

By contrast, I consider that damages are an adequate remedy for the Council if the suspension is not lifted and it turns out that BMLL’s claim is ill-founded. I say that for two reasons. First, if that happens, then (for the reasons explored in Section 7.2 below) that will lead to a six month delay in Refuge starting work. The costs savings to the Council (if any) which they will have been deprived of, because of that six months delay, can easily be calculated. So too can any administrative costs referable to the delay. What is more, the evidence from Mr Kandola shows that BMLL’s cross-undertaking in respect of such damages would be met.

The Council say that the prejudice caused to the service users by this six month delay is not something which can be compensated for in damages. If there were any prejudice to the service users then I would accept that submission. However, for the reasons explored in Section 8 below, I have concluded that no such prejudice has been demonstrated.

For those reasons, therefore, damages would be an adequate remedy for the Council if BMLL’s claim is unsustainable and the six month delay should not have occurred. On that basis, therefore, a consideration of the adequacy of damages, the first critical element of the balance of convenience, is in favour of maintaining the suspension.

The Importance of the Remedy of Review

The Law

In Morrisons Facilities Services Ltd v Norwich City Council [2010] EWHC 487, Arnold J said that the fact that the only remedy available once a contract had been entered into was that of damages, as opposed to the potential remedies envisaged by the New Remedies Directive, was a relevant consideration to be taken into account in assessing the overall balance of convenience. In Alstom Transport v Eurostar International Ltd [2010] EWHC 2747, Vos J (as he then was) stressed the importance of the remedy of review, as did Ramsey J in NATS.

The importance of the remedy has recently been restated in R (on the application of Edenred (UK Group) Ltd v Her Majesty’s Treasury and Others [2014] EWHC 3555 (QB). In that case, Leggatt J said:

“31.

Looking at the matter overall, I accept the defendants' contention that there is a public interest in the avoidance of delay and that there will be a detriment to that interest if it is necessary to wait a further six weeks before the TFC scheme can be launched. I do not, however, consider that detriment to be sufficient to outweigh the strong public interest in compliance with the law and the benefits that implementing the scheme in a lawful way may be expected to bring. That is particularly so given the arrangements that have been made for an expedited trial and the fact that, as I have assumed for the purpose of this judgment, a decision on the question of legality can be expected within a relatively short time.”

This is therefore a matter to which the court must have regard when assessing the balance of convenience.

The Application to the Present Case

In my view, the public interest in ensuring compliance with the law is particularly significant in the present case because, for the reasons that I have explained, if the suspension is lifted, that is effectively the end of BMML’s claim. Thus, if BMLL are right and this procurement process was not properly operated, they will have been deprived for all time of a significant legal right.

Of course, in all cases where this issue arises for consideration, what matters is whether or not the trial can be heard in a reasonably short time in order for the issues to be finally determined. In some procurement disputes, the issues raised are so complicated, and require such preparation prior to trial, that the delay before the issues can be properly determined is too long, and the suspension has to be lifted. However, that is not this case. As I have demonstrated, the issues which are raised here are straightforward. Some documents have already been disclosed. The major work before trial will be the preparation of witness statements but that, in itself, is not an overly onerous task.

In my view, disclosure can be given before the end of April and witness statements can be prepared and exchanged by the last week in May. In those circumstances, a trial can take place in mid-June. As it happens, the TCC listing office has informed the court that this 3 day trial could be accommodated on 9, 15 or 22 June 2015.

Of course, following the trial, it is likely that the judge will reserve judgment, but I consider it likely that the judgment will be provided sometime in July 2015. Even if the claim is unsuccessful and even allowing for the three month mobilisation period noted in the documents, that means that the new contract could start with Refuge in October 2015. That is a total delay of six months. In the overall scheme of things, I do not regard that as too long, given the time it has taken to prepare the proposed new contract and the length that it might last. Accordingly, the fact that the remedy of review can be dealt with relatively promptly by the TCC is another factor in the balance of convenience weighing against lifting the suspension.

Advantages/Disadvantages If the Suspension is Not Lifted

I have already set out the advantages to BMLL if the suspension is not lifted: damages are not an adequate remedy for them; and their claim will not be extinguished at the interlocutory stage without full consideration. What are the disadvantages to the Council if the suspension is not lifted? The Council sought to rely on two principal matters: the alleged benefits of the Refuge tender (of which they will be deprived for six months if the suspension is not lifted); and the perceived advantages of the new contract (of which they would again be deprived for 6 months). Repeatedly throughout the Council’s evidence, these alleged benefits are elided. In my view, for the reasons noted below, they need to be kept apart.

As to the alleged benefits of the Refuge tender, I am uncomfortable with a situation where the Council has refused to provide Refuge’s tender voluntarily, and then seeks to rely on aspects of that very same tender in order to demonstrate disadvantage if the suspension is not lifted. That is potentially unfair to BMLL for the reasons set out in Section 4 above. Furthermore, also for the reasons set out in Section 4 above, I consider that it is inappropriate for the Council to rely on these alleged advantages, in circumstances where, in these proceedings, BMLL challenge any suggestion that their tender is inferior to that of Refuge. By seeking to rely on the alleged advantages of the (undisclosed) Refuge tender, the Council are relying on the single most controversial part of the whole case. Again, I consider that to be illegitimate in circumstances where BMLL are simply not in a position to respond.

On the other hand, I entirely accept that the Council is entitled to rely on the perceived advantages of the new proposed contract, compared to the old, in order to argue that the delay will cause prejudice. After all, the whole purpose of this new contract was to provide improved services. The question therefore is whether the advantages of the new proposed contract are so much greater than the services currently being provided by BMLL that the court should not permit the six month delay noted above, because of the prejudice to the service users.

In my view, on analysis, the evidence does not demonstrate that the new contract will provide services to the users which are significantly better than the services currently provided by BMLL. My reasons for that view are set out below.

First, much is made in the Council’s evidence of the fact that there are currently five contracts, and there will now be one overarching contract. That is, I am sure, an advantage to the Council. But since all five contracts are currently operated by BMLL, and there is no criticism of the way in which they currently operate those contracts, this does not seem to be a matter of any relevance to the service users.

The perceived advantages of the new proposed contract are set out in paragraphs 5-9 of the statement of Mr Anderson. Paragraphs 54-60 of Ms Metters statement takes each point that he makes, and explains in some detail how and why that which BMLL currently provide is the same as, or better than, the new contract specification. What is more, there is no complaint about any of Ms Metters’ evidence on this topic in the short statement in response from Ms Griffiths. Again, therefore, it would appear that there is no dispute that, whatever the existing contract may say, the actual services provided by BMLL broadly equate to the services to be provided under the new proposed contract.

It is possible to give some concrete examples of this. Under the existing contract, 28 safe-houses are required. Under the new contract, 36 are required. Yet Ms Metters explains that BMLL currently provide 38 safe-houses and have access to others. Or take the families to be protected by the new arrangements. Currently the contract requires 650 families to be protected, whilst the new contract requires 720 families to be protected. Ms Metters explains that BMLL currently protects 917 families.

Accordingly, the Council have not made out a case that a delay of 6 months in the letting of the new contract would have any adverse effect on the service users. The evidence is that, whatever the old contract may say, BMLL currently provide a service that is broadly equivalent to, if not better than, that required by the new contract. Detriment to the service users if there is a delay – and I accept that that is by far the most important consideration in play here – has not been shown.

There is a related point. The Council (and Mr Williams QC) have repeatedly said that, if Ms Metters’ statement is right, and what BMLL provide now is so much better than that which the original contract stipulated, it was surprising that they did not make this plain in their tender. That of course begs the question as to whether or not BMLL did in fact do just that, an issue at the heart of their compliant that they constantly received scores of 3 when they were entitled to scores of 4 or 5. It was a further hint that something, somewhere, may have gone awry in the Council’s tender evaluation process.

Finally on this topic, I should say that Mr Williams QC relied heavily on the decision of Akenhead J in Solent, which he said was very similar to the present case, and where the suspension was lifted because of the balance of convenience. In truth, although there are some superficial similarities between the cases (the provision of social care services by ‘not for profit’ organisations), there were three important differences. One was the fact that Solent bid on the basis of a 5% profit margin, which was not what happened here. Secondly, the judge rejected Solent’s case as to the other consequences if the suspension was lifted (damage to reputation and so on) whereas, on the facts here, I have found in favour of BMLL and the (different) consequences for them. But thirdly, and for this purpose most importantly of all, I note that at paragraphs 4 and 5 of his judgment in Solent, Akenhead J spent some time demonstrating the considerable advantages of the new contract, compared to the services which were currently being supplied. On the facts of this case, and for the reasons that I have given, the opposite applies here. That is a further explanation for the different result.

For these reasons, I consider that any prejudice to the Council and/or the service users if the suspension is not lifted, and there is a 6 month delay, is either non-existent or, at most, negligible.

Advantages/Disadvantages If the Suspension is Lifted

For the reasons set out above, the advantages to the Council if the suspension is lifted are either non-existent or negligible; the disadvantages to BMLL are fundamental.

For all those reasons, as I explained briefly to the parties at the end of the hearing, the suspension will remain in force until after the expedited trial in this case.