This article is an excerpt from the 2021 edition of The Art of Tendering: A Global Due Diligence Guide, which is available for purchase.
In its May 2008 decision in Leonard Personnel Ltd, Re Application for Judicial Review, the High Court of Justice in Northern Ireland, Queen’s Bench Division, denied an application for judicial review after deciding that the case lacked a sufficient public interest element to justify the judicial review. The case dealt with a bidding process for the creation of a court services framework agreement for the provision of temporary and short-term workers. The applicant was a losing bidder that sought to challenge the evaluation and award result. As the Court summarized, under common law rules, government tendering decisions are not automatically subject to the public law remedy of judicial review. Rather, a sufficient public interest element must first be shown by the applicant before the courts will consider the merits of a tendering complaint under their common law judicial review powers:
There are two general issues that arise. First the public law /private law debate as to whether a public law issue arose in this application to warrant proceedings by way of judicial review. Judicial review operates in the arena of public law and not that of private disputes having no element of public law. At one level this is a commercial dispute about the failure to award a contract and at another level it is a dispute about the arrangements for the provision of public services. The proposed respondent contends that the application does not raise a public law issue and refers to a number of authorities including R (Hibbit & Sanders) v The Lord Chancellor[1993] COD 326, Mass Energy v Birmingham City Council[1994] Env.LR 298, R (Menai Collection Limited) v Department for Constitutional Affairs [2006]EWHC 724 and a Northern Ireland case, TSI (Ireland) Limited’s Application [2005] NIQB 87. In each of these commercial applications for judicial reviews it was found that there was not a sufficient public law element to proceed by way of judicial review.
In Hibbit & Sanders Waller J stated that the fact that a decision making body was exercising a statutory power would entitle a Court to consider whether there must be an implied obligation, for example, to act fairly and added:
The point, however, is that to have a right which can be subject to review that right must flow from the statute, if it is to the statute that one must look for providing a public law element. It is not enough to say simply that the governmental authority is acting by reference to certain statutory provisions without the additional factor that it is those statutes which impose the obligation which is said to have been broken.
Menai Collection Limited was concerned with commercial arrangements for the provision of services for Magistrates’’ Courts in certain areas of England and Wales. At paragraph 42 McCombe J referred to the classic areas in which judicial review will be available in the context of commercial activities of public bodies, namely cases of fraud, corruption and bad faith etc. and added that whether, in a particular case, the obligation said to have been owed by the decision maker involved suggested breaches of duties or obligations owed as a matter of public law, depended upon an analysis of the criticism made and the facts upon which the criticism was based.
To introduce the necessary public law element there may be statutory underpinning, but that in itself would not be sufficient, as there must also be some statutory obligation arising from that statutory underpinning which is in issue in the particular proceedings. Whether or not it is of a sufficient public law nature depends upon analysis of the facts and issues.
In the present case the issues arise in the context of public procurement and on the basis of the applicant’s contention that EC Regulations and the Public Contract Regulations 2006 apply to the contract/framework agreement there is certainly the element of statutory underpinning. There are said to be statutory obligations in issue arising out of the obligation to act objectively, fairly and transparently and the other general obligations that arise in relation to such public contracts. I do not doubt that in this context there may be public law issues that arise. In a particular case the existence of the necessary public law element depends upon an analysis of the criticisms made and the facts upon which they are based.
Turning to the specific facts of the case, the Court determined that even if the evaluation process was a reviewable statutory decision, the complainant’s challenge to the government’s evaluation team’s scoring did not give rise to sufficiently serious public interest questions to justify a judicial review. The application was therefore denied. As this case illustrates, even where judicial review remedies are potentially available to losing bidders, the courts will typically retain the discretion to apply threshold screening criteria, such as a public interest test, before being seized of a matter and accepting a full hearing on the merits of a bid protest. The onus remains on complainants to bring forward compelling grounds to substantiate judicial incursions into the government tendering process.
