Legal Services Commission - Public contracts - Genuine clerical error on tender form

R (on the application of Harrow Solicitors & Advocates) v Legal Services Commission: QBD (Admin) (Judge Waksman QC): 28 April 2011

The claimant firm of solicitors (H) applied for judicial review of the refusal of its appeal by the defendant Legal Services Commission (LSC) against their decision not to award H a contract to undertake publicly-funded immigration work.

The LSC invited tenders from law firms in respect of the work.

The tender submission period was eight weeks.

The day before the deadline, H completed its form but mistakenly answered ‘no’ in answering a question as to whether the firm offered a regular drop-in session per week.

The LSC awarded points for particular answers in the questionnaire.

H’s bid failed because it did not secure the 33 points required to gain an immigration work contract.

It scored 31 points. H would have scored the necessary extra two points if it had answered ‘yes’ to the question.

H did offer drop-in sessions. On being informed of the LSC’s decision, and realising its error, H appealed.

The LSC rejected the appeal on the basis that the ‘Information for Applicants document comprehensively set out the responsibility on a tenderer to ensure that the tender response was accurate, and that the appeal was an attempt to amend H’s tender.

H submitted that the LSC’s decision was Wednesbury unreasonable and disproportionate as there was a genuine clerical error which was objectively verifiable in that it could be easily ascertained that H offered drop-in sessions and the consequences were catastrophic for H as it would have to close its immigration department and there was a risk of H closing altogether.

Held: (1) From the case law, it was possible to discern four principles:

(i) all tenderers had to be treated equally;

(ii) it would violate that principle and the principle of good administration in the tendering process if any tenderer were permitted to change its bid after bidding had closed;

(iii) if the awarding authority had a discretion to seek clarification about a bid from the tenderer, the court would not normally interfere with the exercise of that discretion unless it was exercised unequally or unfairly or, it was not exercised, yet it appeared to the awarding authority that there was an ambiguity or obvious error; (iv) any purported clarification must not amount to a change in the bid.

The critical factor that gave rise to a duty to seek clarification was where the tender as it stood could not be properly considered because it was ambiguous or incomplete or contained an obvious clerical error rendering that part of the bid suspect, Adia Interim v Commission of the European Communities (T19/95) (1996) ECR II-321 CFI (4th Chamber), Resource Management Services v Westminster City Council [1999] 2 CMLR 849 QBD and Antwerpe Boukewewerken v European Commission T-195/2008 considered.

There was no such ambiguity, defect or obvious error on the face of H’s tender.

A tenderer that made a mistake which did not render the tender ambiguous or deficient on its face, but which was objectively verifiable, was not entitled to have it rectified as a matter of principle.

If the awarding authority perceived no obstacle it was entitled to consider the tender in the usual way (see paragraphs 29-32 of judgment).

(2) There was a need to maintain firm rules for the tendering process which were applicable to all, JB Leadbitter & Co Ltd v Devon CC [2009] EWHC 930 (Ch), 124 Con LR 135 followed.

Correction of H’s error would have amounted to an impermissible change in the bid, JR Jones v Legal Services Commission [2010] EWHC 3671 (Ch) followed.

An individual applicant should not be afforded an opportunity to amend the bid and improve its prospects of success after the submission date had passed, R (on the application of Hoole & Co) v Legal Services Commission [2011] EWHC 886 (Admin) followed (paragraphs 39, 42, 47-48).

(3) Any proportionality review was not to focus exclusively on the particular consequences for the failed tenderer however severe, Hoole followed.

The LSC’s decision was not irrational or disproportionate.

H had eight weeks to produce and perfect its tender.

A relevant consideration was the need to treat all tenderers equally in terms of getting a properly filled-in and accurate form in on time.

The strict requirements for the tender process were clearly made known in advance to all tenderers including H (paragraphs 52, 54, 56).

Application refused.

Gerard Clarke (instructed by the in-house solicitor) for the claimant; Clive Rawlings (instructed by the in-house solicitor) for the defendant.