Procurement case law round-up: Bromcom vs United Learning Trust
Welcome to the Procurement Case Law Round Up series, where we'll be highlighting some of the key procurement cases of 2022 (and surprisingly, quite a few from 2023 so far).
The series is brought to you by lawyers from the Muckle LLP procurement team and this instalment comes from Alison Walton, partner and head of procurement.
This week we consider the case of Bromcom Computers plc v United Learning Trust and United Schools Trust, a judgment handed down by the Technology and Construction Court in December last year.
This was an interesting case which will pique the interest of procurement professionals and lawyers alike.
It covers many of the practical issues on which we are frequently asked to advise when it comes to tender submission requirements, incumbent advantage, clarification of tenders, evaluation and moderation and is well worth a read in full if you deal with these topics on a frequent basis.
The background
Bromcom and the successful tenderer, Arbor Education Partners Limited, had each participated in the final stages of a competitive dialogue tender process for the provision of a £2 million contract for a management information system (MIS) for use in 57 of the defendant trust’s academy schools.
The issues
The judgment really turns on manifest errors in scoring (see below) which were fact-specific to this case, but it is of real interest to procurement lawyers due to the various practical issues it addresses in addition to the scoring issues.
Tender submission by the wrong means
Tenders were required to be submitted by email. Arbor’s tender was submitted by sending a link via email to a Dropbox into which it had uploaded its tender documents.
Bromcom argued that this was not a valid submission of tender documents in accordance with the stated requirements of the process.
The court said that the use of Dropbox did not fulfil the technical requirements of Regulation 22(16) of the Public Contracts Regulations 2015 (PCR) because Arbor still had access to the Dropbox documents (and could change them) after the tender deadline and there was no simple method of ascertaining the precise point in time when the bid was submitted.
The judge was of the view that the only compliant method of tender submission in line with the PCR would be email submission or uploading the documents to a secure portal. Therefore there had not been a valid submission of Arbor’s tender.
However, the court also found that had the Trust informed Arbor of this at the time, Arbor would easily have been able to submit the tender by another means before the deadline and therefore it would not have resulted in Arbor being excluded from the process.
The Trust was therefore entitled to accept Arbor’s Dropbox submission.
The extent of clarifications after tender submission
After the deadline for tenders, the Trust alerted Arbor to the fact it had not submitted a document with its tender and allowed it to be submitted after the deadline.
Bromcom said that this went beyond mere clarification of the tender and should not have been permitted.
The court found that the document in question was in fact non-mandatory for tender submission as it related to clarifications which occurred during the dialogue phase.
As such, it was not an essential part of the bid and would not have impacted on the scoring or the result of the evaluation.
Improving tenders after the deadline
When submitting the missing clarification document, Arbor took the opportunity to correct errors in one of its bid documents relating to uptime.
The court said that this was a simple correction and that “it would be absurd to suggest that a contracting authority had no power whatsoever to receive a correction of any kind once the final bid had gone in”.
However, it did also state that the other bidders should have been informed that an amended document had been submitted and accepted by the authority, in order to preserve the principle of transparency.
Moderation
Evaluators’ individual scores were averaged to arrive at a final score for each tenderer’s response to each question – there was no discussion, consensus score or overall agreed rationale for the final scores awarded.
The court’s view was that averaging the evaluators’ scores was not an acceptable method for moderation. It said that this was no more than a mathematical exercise and did “not constitute a discussion of individual scores as part of an attempt with give and take to reach a collective consensus view so that there is a reasoned basis for the scores given by the contracting authority itself”.
Further, the scores to be awarded were described in the procurement documents in whole numbers and a RWIND tenderer[2] would expect scores therefore to be awarded in whole numbers (rather than the decimal points that were the outcome of the averaging exercise).
Scoring
Bromcom alleged that there were manifest errors in the way some of the quality scores had been awarded due to misunderstanding of its tender submission by some of the evaluators.
The judge found that there had been a manifest error in the scoring which would either amend the scoring in Bromcom’s favour or increase its score on price.
The crux of the case really rests on the manifest errors that the court found in the scoring process and the decision turns on this point.
As the court went through the various errors in the judgment it concluded that these meant that Bromcom would have ranked higher than Arbor in the process by quite some margin.
Incumbent advantage
Bromcom also alleged that certain assumed mobilisation costs had been added to its own price to its detriment, and argued these should not have been added in order to neutralise Arbor’s inherent “incumbent advantage”
The court reiterated the view (following previous case law) that there is no obligation on the contracting authority to neutralise every incumbent advantage.
In the present case, there was evidence that the incumbent’s pricing was lower because it had applied its own internal discount as a result of it already having an existing contract with the Trust for 15 schools.
The court found that this was not an “advantage” which it was necessary for the Trust to neutralise; the discount was not dependent on retaining the existing contract as this new pricing was a standalone offer.
However it reiterated that in order to protect the principle of equal treatment as far as possible, a balance must be struck and the potential advantages of the incumbent must be neutralised to the extent it is technically easy to neutralise them and where it is economically acceptable.
Whilst this is helpful clarification, it doesn’t actually provide any further guidance for contracting authorities on what they need to do in practice to neutralise those advantages, so doesn’t necessarily take us any further forward on this point.
The limitation will only run from the point of clear notification
Points were also raised by the Trust in relation to limitation given that there were numerous letters to and meetings with Bromcom following notification of the evaluation results and hence some confusion over when time started to run for the purpose of limitation.
The court said that where there were unclear and unstructured debrief calls, this would not start time running, stating that later letters confirming what had been said in the meetings were what started the time running for limitation; “a tenderer is surely entitled to see the information put in a clear and structured form, not least to enable its lawyers to give it timely advice”
Limitation periods in procurement claims are extremely short. A claim must be brought within 30 days of the claimant becoming aware (or the date on which it reasonably ought to have been aware) of there being grounds for the claim.
The court considered the various points at which information had been disclosed to Bromcom and hence when limitation periods had started to run based on its knowledge of there being breaches of the PCR. It found that the claim was brought in time.
Conclusion
Overall the judgment went in favour of Bromcom, with the court saying that there was a failure on the whole to treat bidders equally and manifest errors in the evaluation process.
There was a failure on the part of the Trust to seek clarification of tenders which would have avoided erroneous assumptions being made which led to many of the manifest errors.
The way the judgment deals with the numerous issues really does highlight that whilst there are some key principles in procurement processes which must be adhered to, every case will turn on its facts and the courts are willing to take a pragmatic and purposive view of the PCR in applying their requirements and principles.
The tone of the judgment does show that the court has some sympathy with bidders and authorities alike in relation to the complexities of running and bidding in a complex procurement process such as the competitive dialogue procedure but that the courts will look at the overall impact of the actions of the authority in the context of the overarching principles of equality of treatment, transparency and fairness.
For more information or advice around procurement law, get in touch with Alison directly using 0191 211 7850 or [email protected].
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