Challenging public body tender awards... what businesses need to know
Businesses involved in the tendering process for public procurement contracts need to be well versed in the regulations.
The rules for awarding public contracts are set down in the Public Contracts Regulations 2006 and these rules govern the process by which public bodies can award contracts to suppliers.
Businesses should take legal advice when beginning a tender process to confirm if the regulations apply, as failure by the awarding body to adhere to the rules can give rise to claims.
One such recent case involved a local company, Northstone, alleging that Transport NI’s tender process in connection with road resurfacing was in breach of the regulations. The company brought proceedings challenging the outcome.
Northstone believed that Transport NI had not acted in accordance with the principle of equal treatment of tenderers and the principle of transparency.
However, the bringing of the case effectively stymied Transport NI from awarding the tender, and consequently Transport NI brought an application asking the court to allow them to temporarily award the contract pending resolution of the main case.
Applying principles laid down in an earlier unrelated case, and in terms of the “balance of convenience”, the judge considered that damages would be sufficient for any loss Northstone suffered from temporarily awarding the contract to another party.
In addition, it was a firm belief that Transport NI had an obligation to provide a good standard of roads throughout Northern Ireland and he stated that there was no reason for the court to stand in the way of delivering this.
The judge also stated that it was in the public interest for roads to be regularly maintained and therefore ordered that Transport NI could award the contract provisionally, pending resolution of the main case. In the event that Northstone is ultimately successful in its legal action, it will be entitled to recover damages for any loss arising from the provisional contract award.
The court has wide powers to grant interim relief in procurement cases, especially if it is in the public interest. This case, and the regulations in general, are of importance to any party involved in a regulated tender process, whether buyer or vendor.
Vendors should scrutinise the results of any tender process and raise queries if they suspect contracts have been awarded inappropriately. Time limits to raise objections can be just 10 days and delay in instructing solicitors could harm the case.
Buyers must ensure their tender processes abide by the regulations. Contracts must be awarded in a fair and transparent manner. If challenged, buyers must ensure that they do not neglect their obligations to the public. The court can allow the buyer to temporarily award contracts to ensure public duties are carried out.
Again, it is important to instruct solicitors immediately for advice to ensure obligations are met.
*David Wilson is a solicitor in Worthingtons experienced in dealing with procurement challenges. He can provide urgent advice and can be reached on 028 9043 4015