Sita UK Ltd v Greater Manchester Waste Disposal Authority

In public-procurement proceedings, the three-month period must run from the date when the claimant knew, or ought to have known, of the infringement. The incompatible requirement to bring proceedings promptly is disapplied, but the short period remains effective.

Knowledge exists when the claimant knows facts which apparently clearly indicate an infringement. It need not have conclusive evidence, complete particulars, or a real likelihood of success. A genuine statutory letter before action alleging a breach will ordinarily demonstrate sufficient knowledge of that breach. Later information which merely strengthens or particularises the same alleged infringement does not restart time.

Sita UK Limited, an unsuccessful tenderer for a long-term waste-disposal contract, alleged that the authority had materially renegotiated the preferred bidder’s proposal without reopening competition. It commenced proceedings alleging breaches of procurement duties of transparency and equal treatment.

Mann J struck out the claim as time-barred under regulation 32(4) of the Public Services Contracts Regulations 1993. Sita appealed. The principal issue was when it had sufficient actual knowledge of an alleged procurement infringement for the three-month period to begin, and whether later-disclosed material constituted separate breaches or merely further evidence of the same claim.

1. Appeal dismissed unanimously. Elias LJ, with whom Rimer LJ agreed, held that Directive 89/665, as interpreted in Uniplex UK Limited v NHS Business Services Authority [2010] 2 CMLR 47, required the removal of the promptness requirement in regulation 32(4)(b). It did not require the three-month period to be abandoned. The court must instead ensure, through the statutory power to extend time, that the period runs from actual or constructive knowledge. This preserved both legal certainty and the Directive’s requirement for rapid remedies.

2. The requisite knowledge was knowledge of facts which apparently clearly indicated an infringement, although they need not prove it. The claimant need not possess the evidence required to plead every particular, nor know that the claim has a real likelihood of success. The distinction is between grounds of complaint and evidence supporting those grounds.

3. A genuine statutory letter before action alleging a breach will normally make it difficult for its sender to deny sufficient knowledge of that breach. Sita’s April and May 2009 letters asserted procurement breaches and threatened proceedings. They showed that it already had sufficient knowledge, notwithstanding its requests for further information.

4. The later disclosure of the Ernst & Young re-evaluation and further information about the facility were additional evidence and particulars of the same alleged failure to reopen the competition. They were not separate causes of action and did not restart time. Withholding information does not freeze time where the tenderer already has enough information to commence proceedings.

5. The claim was properly struck out. The refusal to extend time disclosed no error of principle, perversity, or conclusion plainly against the weight of the evidence.

Arden LJ agreed that the appeal should be dismissed. She would adhere closely to the language in Uniplex: time begins when the tenderer has sufficient information to form an informed view as to infringement and the appropriateness of proceedings, without any further prospects-of-success threshold.

• Court of Appeal (Civil Division): dismissed Sita’s appeal in Sita UK Ltd v Greater Manchester Waste Disposal Authority [2011] EWCA Civ 156.
• High Court (Chancery Division): Mann J struck out Sita’s procurement claim as commenced outside the applicable limitation period.