Jobsin Co UK Plc (t/a Internet Recruitment Solutions) v Department Of Health

A public services contract is classified by objectively comparing the services requested in the tender documents with the relevant service classifications. The contracting authority’s motivation and its intended use of the resulting service are immaterial.

Under the Public Services Contracts Regulations 1993, a cause of action arises when a breach places a service provider at risk of loss or damage. Actual loss, completion of the tender process and knowledge of the legal significance of the facts are unnecessary. Proceedings must be brought promptly. Ignorance of legal rights and a commercial wish to await the tender result will not usually justify an extension.

The Department of Health invited tenders to develop and manage an online recruitment service for the NHS. Jobsin Co UK Plc submitted a tender but was not shortlisted. It alleged that the procurement should have been conducted as a Part A computer-services contract under the Public Services Contracts Regulations 1993.

Blofeld J determined preliminary issues in Jobsin’s favour. He classified the proposed contract as predominantly involving computer services and held that the claim was not barred by the time limit in Regulation 32(4)(b). The Department appealed.

The Court of Appeal considered the contract’s proper classification, when Jobsin’s cause of action arose, and whether there was good reason to extend time.

1. Appeal allowed unanimously and action dismissed. Dyson LJ delivered the judgment, with which Astill J and Thorpe LJ agreed. The judge had reached the correct result on classification, although his reasoning was not wholly correct, but had erred on limitation.

2. The classification exercise required an objective comparison between the services requested in the briefing document and the detailed CPC descriptions corresponding to Parts A and B of Schedule 1 to the Public Services Contracts Regulations 1993. The “object” of the contract in Article 8 of the Services Directive 92/50/EEC meant the service to be supplied to the contracting authority. It did not permit an inquiry into the authority’s motivation or the wider use intended for that service.

   The requested work comprised the design, programming, implementation, maintenance, operation and support of a website and database, together with data input and NHS staff training. The contractor would not formulate job descriptions, search for candidates, screen applicants, investigate references or place personnel. The proposed contract was therefore entirely for Part A computer and related services, rather than a hybrid contract or a Part B personnel-placement service.

3. Regulation 32(2) was satisfied as soon as a breach caused a service provider to suffer, or risk suffering, loss or damage. Knowledge of the legal significance of the facts was irrelevant. Keymed Limited v Forest Healthcare NHS Trust [1998] ELR 71 was applied. The failure to publish the award criteria required by Regulation 21(3) placed tenderers at risk when the briefing document was issued. Jobsin’s cause of action therefore arose on or about 14 August 2000, rather than upon its exclusion in November.

4. The proceedings were not brought promptly and were outside the three-month period in Regulation 32(4)(b). Ignorance of the law would not usually provide good reason for an extension, particularly where the tenderer already had concerns about the process. A tenderer could not await the result for commercial reasons and challenge the procedure only after an unfavourable outcome. Prompt challenges protect other bidders, good administration and the wider public interest in expeditious procurement.

   The validity of the procurement challenge under European Community law did not displace the limitation provision. Matra Communications SAS v Home Office [1999] 1 WLR 1646 was followed. There was no good reason to extend time to 5 March 2001.

1. Court of Appeal (Civil Division): By [2001] EWCA Civ 1241, unanimously allowed the Department of Health’s appeal on limitation and dismissed the action. It upheld the conclusion that the contract concerned Part A computer services, but differed from the judge’s reasoning.
2. High Court, Queen’s Bench Division: Blofeld J held on preliminary issues that the tender concerned computer and related services and had been conducted in breach of the Public Services Contracts Regulations 1993. He held that the cause of action arose when Jobsin was excluded and would alternatively have extended time.