Luck T/a G Luck Arboricultural & Horticultural v Tower Hamlets

The Court of Appeal dismissed Mr Luck's appeal. The principal legal points decided were: the claimant's statutory cause of action under the Public Services Contracts Regulations 1993 was barred for failure to comply with the condition precedent in regulation 32(4)(a) (the requirement effectively to serve a notice identifying the regulation and the alleged breach before commencing proceedings); the requirement in reg 32(4)(a) is valid under Community law and the European Convention; the contract did not fall within the Part A category of "property management services" in Schedule 1 and therefore the fuller protections of the Regulations did not apply; and the alternative tort claim for misfeasance in public office failed because the judge properly rejected any inference of bad faith or malice on the part of the council or its officers.

The court held that where a claimant relies on an inference of bad faith the evidential burden is strict and proof that the contracting authority's decision was within the range of reasonable responses defeats an inference of malice. The judge's findings on the corporate reference and surrounding documentary material sufficed to reject the misfeasance claim.

Background and parties: The appellant, Gary Luck trading as G Luck Arboricultural & Horticultural, applied in October 1996 to be placed on a list of approved contractors for a measured term arboricultural contract with the London Borough of Tower Hamlets. The borough excluded him at a pre-tender stage and the contract was let to Connick Tree Care. Mr Luck began proceedings alleging breach of the Public Services Contracts Regulations 1993 and, in the alternative, misfeasance in public office.

Nature of the claim and relief sought: Mr Luck sought damages for breach of the Regulations (having issued writ within the three-month limitation period in reg 32(4)(b)) and alternatively damages for misfeasance in public office based on alleged bad faith and malice by borough officers in compiling or supplying a corporate reference which influenced the pre-tender evaluation.

Procedural posture: The proceedings began in 1997. An application for judicial review was refused leave by Richards J in 1998; on appeal to this court Simon Brown LJ held the claim was properly a damages action and allowed appeal so that discovery and ordinary civil process could proceed. After trial before HHJ MacDuff QC the claimant lost and appealed to the Court of Appeal.

Issues framed by the court:

• Whether Mr Luck had complied with reg 32(4)(a) (the pre-action notice condition) and whether that condition was valid under Community law and the European Convention.
• Whether the services in question were "property management services" in Schedule 1 so as to attract the full Part A regime of the Regulations.
• Whether the borough had failed to publish or apply minimum pre-tender standards required by the Regulations.
• Whether the claimant proved bad faith or malice sufficient to sustain a claim in misfeasance in public office.

Court's reasoning: On reg 32(4)(a) the court interpreted the regulation literally: the claimant must inform the contracting authority of the breach (or apprehended breach) and his intention to bring proceedings "under this regulation in respect of it". The pre-writ correspondence did not identify the Regulations or the relevant breach and thus did not satisfy reg 32(4)(a). The court rejected the submission that reg 32(4)(a) was incompatible with Community law or article 6 ECHR, applying precedent (notably Matra Communications) and reasoning that the requirement is compatible with equivalence and effectiveness and that safeguards (extension of time under reg 32(4)(b) and reg 23 disclosure obligations) address practical difficulties. On classification under Schedule 1 the court accepted the trial judge's factual conclusion that the contract consisted of specialised works of arboriculture rather than management services falling within CPC 822 and so was not a Part A property management service. On minimum standards and the precise test of review the court declined to determine disputed abstract points in the absence of necessity. Finally, on misfeasance in public office the court agreed with HHJ MacDuff that the evidence did not support an inference of targeted or untargeted malice and that proof that the decision fell within the range of reasonable responses defeated the inference of bad faith.

Appeal dismissed. The court held that Mr Luck had not complied with regulation 32(4)(a) of the Public Services Contracts Regulations 1993 and so had no cause of action under those Regulations; the contested contract did not fall within the Part A category of "property management services" in Schedule 1; and the alternative tort claim for misfeasance in public office failed because there was insufficient evidence of bad faith or malice and the borough's decision lay within a range of reasonable responses.

Proceedings began in Central London County Court; Richards J refused leave for judicial review (1998) and rejected the application. On appeal to the Court of Appeal (Simon Brown LJ) the application was recharacterised and the appeal allowed so that the matter could proceed as an ordinary damages claim (hearing 2 March 1999). After trial before HHJ MacDuff QC in the Central London County Court (trial and judgment not given a separate neutral citation in these papers), the claimant appealed to the Court of Appeal where the appeal was dismissed [2003] EWCA Civ 52.