THE LEVEL PLAYING FIELD IN PROCUREMENT LAW

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Transcript THE LEVEL PLAYING FIELD IN PROCUREMENT LAW

BEYOND THE DIRECTIVE
Nigel Giffin QC
11KBW Chambers
Bangor University procurement week
22 March 2013
WHERE DO PROCUREMENT LAW RIGHTS AND
REMEDIES COME FROM?
• Most obviously, Directive 2004/18/EC and Public
Contracts Regulations 2006
• But potentially also  EU law – general principles derived from TFEU
 Domestic public law
 Law of contract
 Law of tort
WHY DOES IT MATTER?
• Obligations under PCR, TFEU principles and implied
contract in many ways similar
• But they apply to different contracts
• And they lead to very different remedies regimes
(procedures and relief)
WHAT ARE THE TFEU PRINCIPLES?
• Most obviously –
 Non-discrimination
 Equality
 Transparency
• Potentially also –





Proportionality
Good administration
Legal certainty
Confidentiality
And others?
BASIS FOR APPLYING THE
TFEU PRINCIPLES
• TFEU prohibits restrictions on freedom of
establishment/freedom to provide services of nationals of
member states
• Award of a public contract to one undertaking inhibits
freedom of others to provide services
• To avoid restriction contrary to TFEU, must be done on
basis which avoids discrimination
• Hence implied positive obligation to comply with general
principles
WHICH CASES ARE COVERED?
•
Part B services contracts (before expressly made subject to
transparency/equality obligations in Directive) – C-532/03 Commission v
Ireland
•
Sub-threshold contracts – C-59/00 Vestergaard [2001] ECR I-9505
•
Concession contracts – C-324/98 Teleaustria [2000] ECR I-10745; C-458/03
Parking Brixen [2006] 1 CMLR 3
 For definition, see C-274/09 Privater Rettungsdienst Sadler and JBW Group
Ltd v Ministry of Justice [2012] EWCA Civ 8
•
At least some other economic opportunities
 C-145/08 Club Hotel Loutraki [2010] 3 CMLR 33 – share sale and
management agreement
 C-203/08 Sporting Exchange Ltd [2010] 3 CMLR 41
KEY ISSUES ON GENERAL TFEU
PRINCIPLES
• What exactly is authority obliged to do?
• What are limits to when TFEU principles apply?
• When is a contract of cross-border interest?
OBLIGATIONS UNDER TFEU
•
Not required to follow detailed rules in Directive
 AG in C-195/04 Commission v Finland
 C-226/09 Commission v Ireland (disclosure of weightings)
 C-95/10 Strong Seguranca SA (reliance on associated company)
•
But some advertising and competition is required
•
Explained in Commission’s Interpretive Communication (2006/C
179/02) – upheld in T-258/06 Commission v Germany
EXCEPTIONS TO TFEU OBLIGATIONS
•
C-6/05 Medipac-Kazantzidis [2007] ECR I-4557
•
Directive exceptions apply by analogy
•
Probably also a broader public interest justification, though must be
limited and proportionate
•
Possibly also TFEU Article 106(2) in cases where Treaty obligations
would obstruct performance of tasks in operation of services of general
economic interest
•
Query whether broader exceptions apply to Part B services under PCR
AG QUIDNET HOUNSLOW LLP
v HOUNSLOW LBC [2012] EWHC 2639 (TCC) –
LIMITS OF TFEU
• Council negotiating exclusively with one landowner (L)
for town centre development agreement – claimant (Q)
arguing it should have had chance to compete
• Development agreement assumed not to be a public
works contract, because no obligation on developer to
carry out works – a frequent technique
• Council’s agreement crucial to site assembly
• Q argued that transparency and equality obligations
arose under TFEU Article 56
QUIDNET – COULSON J’s DECISION
•
Not within Article 56 – L not providing services - only an agreement to agree
terms of a long lease
•
No obligation on L to carry out development/provide any services
•
Construction etc for development would be services provided to L, not by it
– no restriction on who could provide those services
•
Not akin to concession where concessionaire put in shoes of authority and
obliged to provide services but entitled to charge
•
Too radical to suggest TFEU applies to grant of a lease
•
Matter anyway wholly internal to UK (see next slide)
•
If Article 56 had applied, obligations not met merely by council making
known its intention to enter agreement with L
QUIDNET AND CROSS-BORDER INTEREST
• Land was in UK, and Q and L were UK undertakings
• No evidence that any non-UK undertaking interested in
development
• Held therefore to be confined to UK, as in RI.SAN [1999]
ECR I-5219
• Rejected conflicting approach in C-231/03 CoNaMe
[2006] 1 CMLR 2 and Parking Brixen – enough that nonUK undertaking might be interested if advertised
• Doubtful that this is correct
PROCEDURE FOR A TFEU CLAIM
• Falls outside remedies provisions of PCR – they cover enforceable
EU obligations, but not where contract outside PCR scope
• So how to enforce? – must be an effective remedy
• Judicial review proceedings in R (Virgin Trains Ltd) v Secretary of
State for Transport – on basis that franchise was a concession
• In Quidnet, claim for breach of statutory duty under European
Communities Act 1972
• Held in Phonographic Performance Ltd v DTI [2004] 1 WLR 2893
that ECA claim (rather than JR) not abuse of process where seeking
Factortame damages
WHY DOES FORM OF PROCEDURE MATTER?
• Whether automatic suspension applies
• Time limit for claim – PCR 30 days – JR 3 months (promptness
requirement contrary to EU law – C-406/08 Uniplex [2010] 2 CMLR
47) – breach of statutory duty 6 years!
• Held in Quidnet that relief could not be withheld on delay grounds if
acted within limitation period
• Availability of damages – no special test under PCR – otherwise
necessary to show grave and manifest breach
• Procedure – normally no cross-examination in JR – no automatic
disclosure (though duty of candour) – permission required
JUDICIAL REVIEW FOR BREACH OF PCR?
•
Claims by economic operators –
 Rejected in R (Cookson & Clegg) v MoD [2005] EWCA Civ 577
 Possibility accepted in R (Hossack) v LSC [2011] EWCA Civ 788
 Need should be rare – perhaps in a case such as Federal Security Services Ltd v
PSNI [2009] NICh 3?
•
Claims by third parties –
 R (Chandler) v Secretary of State for Children Schools and Families [2010] LGR
1 accepts possibility
 R (Unison) v NHS Wiltshire PCT [2012] EWHC 624 (Admin) indicates very
limited standing
JUDICIAL REVIEW TO ENFORCE OTHER
OBLIGATIONS IN PROCUREMENT CONTEXT?
• Public sector equality duty (Equality Act 2010 s 149)
• Consultation on local authority best value arrangements under
Local Government Act 1999 s 3 – R (Nash) v Barnet LBC
• Best consideration under Local Government Act 1972 s 123
• Alleged defects in decision-making process e.g. R (De
Whalley) v Norfolk CC [2011] EWHC 3739 (Admin)
• Does breach make contract void? – probably not – Charles
Terence Estates Ltd v Cornwall Council [2013] 1 WLR 466
JUDICIAL REVIEW FOR BIDDERS
WHERE OUTSIDE EU LAW?
• Do contracting decisions have sufficient public law element?
• Not usually – R (Menai Collect Ltd) v DCA [2006] EWHC 727
(Admin); R (Gamesa Energy UK Ltd) v National Assembly for Wales
[2006] EWHC 2167 (Admin)
• But sometimes – R (Law Society) v LSC [2008] QB 737
• Local Government Act 1988 injects sufficient statutory element in
local authority cases – R (A) v B Council [2007] LGR 813
• Judicial review often exercised in cases re bidding for grants,
exclusive licences etc e.g. Re Watters [2009] NIQB 71, R (Asha
Foundation) v Millennium Commission [2003] EWCA Civ 88
CURRENT GOVERNMENT CONSULTATION
•
December 2012 - Judicial review: proposals for reform
• Para 51 proposes 30 day time limit for JR proceedings
“based on decisions or actions within the ambit of the
PCR” – would catch Unison - not Quidnet – what about
Nash?
• Para 65 proposes amendment to CPR r.54.5 to make
clear that JR claims to be brought within 3 months of first
instance of grounds in cases where multiple decisions
involved
CLAIMS IN CONTRACT (1)
• Implied contract idea developed in exceptional, pre-PCR
circumstances – Blackpool & Fylde Aero Club [1990] 1 WLR
1195
• Some subsequent enthusiasm for idea that a contract to be
implied generally – Harmon CFEM Facades v House of
Commons (1999) 67 ConLR 1; Natural World Products Ltd v
Arc21 [2008] LGR 49; Deane Public Works Ltd v Northern
Ireland Water [2009] NICh 8
• Could apply in private procurements? – SES Contracting Ltd v
UK Coal plc [2007] EWHC 161 (QB)
CLAIMS IN CONTRACT (2)
• More recent cases unenthusiastic
 No scope to imply on top of statutory regime (J Varney & Sons
Waste Management Ltd v Hertfordshire CC [2010] LGR 801)
 Even in other cases, only a limited good faith obligation (JBW
Group; cf. Re Sidey Ltd [2011] CSOH 194)
 Could not use to obtain 6 year limitation period (Montpellier Estates
Ltd v Leeds CC [2013] EWHC 166 (QB))
• Most tender documents now expressly exclude contract
CLAIMS IN TORT
• May be relevant especially in wasted costs claims
• Misrepresentation – implied continuing representation of
intentions?
• Misfeasance in public office
• Claim in deceit failed on facts in Montpellier Estates