The Law Society, R (on the application of) v Legal Services Commission & Ors

A broadly expressed contractual amendment power may satisfy the general transparency obligation where its existence and the parameters of contemplated reform are disclosed. Technical specifications are subject to stricter requirements. They must be contained in the contract documents with sufficient precision to enable an economic operator to determine the subject of the contract and the contracting authority to award it. A power to amend technical specifications is permissible only if narrow and governed by objective criteria. Consultation material outside the contract cannot cure insufficient precision.

The Law Society challenged the Legal Services Commission’s Unified Contract for publicly funded civil legal work. It argued that the unilateral amendment power in clause 13 breached regulation 4(3) and regulation 9 of the Public Contracts Regulations 2006, and the general European-law transparency obligation.

Dexter Montague & Partners brought a parallel damages claim on identical grounds after declining to sign the contract. The issues included whether the contract was a services concession, whether the amendment power complied with regulations 4(3) and 9, whether the claims were timely, whether the Law Society had sufficient interest, and what remedies were available.

1. Application of the procurement regime. The Unified Contract was not a public service concession. Providers were principally paid by the LSC for services rendered and did not obtain a significant proportion of their remuneration from third parties. The Public Contracts Regulations 2006 therefore applied.
2. Transparency. The amendment power was clearly stated in the contract documents. The published parameters of the legal-aid reform programme enabled reasonably well-informed tenderers to understand its scope. In the absence of a competitive bidding process, and because the power applied generally, the amendment power did not breach regulation 4(3). Future amendments outside the published scope, or altering the economic balance of the contract, might require a new procurement procedure.
3. Technical specifications. The contract’s standard of care, peer-review requirements, key performance indicators and quality-assurance standards were technical specifications. Regulation 9 required the specifications and the criteria governing their amendment to be contained in the contract documents with sufficient precision. Clause 13’s broad reference to facilitating legal-aid reform did not satisfy that requirement.
4. Permissible amendment. Regulation 9 did not prohibit every amendment to technical specifications. Any amendment power had to be narrow and based on objective criteria. A later assessment when an amendment was proposed could not replace the prospective clarity required by regulation 9(7).
5. Procedure and relief. The claims were timely because the regulations applied when offers were sought and the contract was not final before then. The Law Society had sufficient interest, and the regulations did not expressly oust judicial review. Declaratory relief was appropriate. Permission and declaratory relief were granted to the Law Society. Dexter Montague & Partners obtained judgment on liability only if the threshold was met, and only in respect of the technical-specification amendment power.