Background
In March 2014, Scotland Excel, a body formed by agreement between all 32 local authorities in Scotland, advertised a procurement exercise in relation to the supply of street lighting materials. Street Lighting Supplies & Co was unsuccessful in its tender for the supply of steel and aluminium lighting columns. It raised an action arguing that Scotland Excel had breached its duties under the Public Contracts (Scotland) Regulations 2012. The raising of the action prevented Scotland Excel from concluding contracts with the successful tenderers. The defenders sought an interim order from the Court in order to remove this prohibition.
Decision
Lord Doherty in the Outer House of the Court of Session granted the interim order in favour of the defenders. He considered the strength of the pursuer's case and found each ground of challenge to be unconvincing.
The defenders had specified a requirement for ultra heavy duty aluminium columns and made clear that they were adopting a "one column fits all" approach. The pursuer argued that this unreasonably denied it the opportunity to tender for the provision of non-heavy duty columns. Lord Doherty found that there was nothing inherently unreasonable or uncommercial in such an approach by the defenders.
The pursuers suggested that the specification closely resembled the standard product specification of a competitor. However, the court noted that, of the two features of the specification which were alleged to closely resemble the competitor's standard specification, one related not to specific mandatory dimensions but to minimum dimensions. Moreover, the defenders were entitled to specify certain characteristics for the product they wanted provided that this did not amount to identifying a specific brand or named product. (See our previous e-update on the 2011 Elekta case).
The court also found it 'untenable' that prospective tenderers would not have anticipated that the precise number of tenderers ultimately appointed would vary based on a number of factors. It was also not unreasonable for the defenders to score the pursuers poorly in terms of technical service delivery questions where the pursuers' answers had been 'terse.'
Finally, the defenders had given the pursuers an 'adequate summary' of their decision bearing in mind the need to protect commercially sensitive information relating to the successful tenders.
Comment
This is the latest in what is now a number of Scottish cases which have affirmed the difficulty a challenging bidder faces in convincing a court to maintain a suspension on a contracting authority entering into a contract following a procurement challenge. It is interesting in its affirmation of what the procurement rules do - they set out rules on the processes to be followed when a contracting authority is purchasing and not rules on what a contracting authority must purchase. This principle is, of course, subject to a contracting authority ensuring it does not act in a discriminatory way, unfairly or in a way that fails to ensure equal treatment. The tension arises when a contracting authority wants to buy something that is closer to the existing product or service of one provider.
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Disclaimer
The material contained in this article is of the nature of general comment only and does not give advice on any particular matter. Recipients should not act on the basis of the information in this e-update without taking appropriate professional advice upon their own particular circumstances.
