A London firm is poised to challenge the Legal Services Commission’s mental health tender process by claiming that it discriminates against smaller firms, as the Law Society’s action over the family contract commences in the Divisional Court today.

The firm, which did not want to be identified, has issued but not yet served proceedings claiming the LSC’s tendering process for the award of contracts to represent mental health patients detained in special hospitals breached the Public Contracts Regulations 2006 (as amended in 2009).

The tender criteria meant that, to be awarded a contract, firms had to show they had had 100 or more clients in a special hospital over a defined one-year period.

The firm, which failed to get a contract for special hospital work, claims that in using this threshold, the bid process and result were unfairly biased in favour of larger firms, and the LSC failed in its statutory duty to treat competing legal providers ‘equally and in a non-discriminatory way’.

Meanwhile, the Law Society’s judicial review of the family tender process, adjourned by the Administrative Court earlier this week, will be heard today in the Divisional Court.

At a hearing on Tuesday, Mr Justice Beatson adjourned the case after his fellow judge, Mr Justice Munby, disqualified himself due to a conflict of interest. Beatson will hear the case with Lord Justice Moses.

At Tuesday’s hearing, the National Youth Advocacy Service was given permission to intervene in the Law Society’s case. A group representing around 70 firms, led by Derek Reynolds at the Children and Families Law Firm, had already been given permission to intervene. It has also served separate judicial review proceedings.

Three other groups sought permission to join the Law Society’s action, but were advised to file their own cases and seek to have them linked to Reynolds’ case.

No date was given for judgment in the main Law Society action, but it is expected some time next week.