Alstom Transport v Eurostar International Ltd & Anor (Rev 1)

On a strike-out application, a claim should be removed only where it is clear that it cannot succeed and a trial would add nothing material.

For the first ground of ineffectiveness under the Utilities Contracts Regulations 2006, a qualification-system notice may constitute the required prior notice. The remedy is unavailable where a relevant notice was given, even if the eventual contract materially departed from the tender process. The second ground requires cumulative satisfaction of four conditions, including that the standstill breach deprived the economic operator of the opportunity to commence proceedings before the contract was made. A claim is also subject to the 30-day period where the operator was informed of the contract and a sufficiently clear summary of the relevant reasons, which may be communicated through several documents or meetings.

Eurostar invited Alstom and Siemens to tender for a new generation of trains. Siemens was selected, and Eurostar entered into contracts with Siemens on 3 December 2010. Alstom alleged that the contracts materially differed from the tender requirements and sought, among other relief, declarations of ineffectiveness under the amended Utilities Contracts Regulations 2006.

The application concerned a later action in which Eurostar and Siemens sought to strike out the ineffectiveness claim. Alstom relied on the first ground under regulation 45K, concerning a contract awarded without prior publication of a required notice, and alternatively on the second ground, concerning breach of the standstill and other regulatory obligations. The defendants also relied on the special limitation period in regulation 45E. The central issues were whether either ground was available and, if so, whether the claim was out of time.

1. Strike-out test. The court would strike out the claim only if it was clear that the claim could not succeed and a trial would add nothing material (para [3]).
2. First ground of ineffectiveness. Regulation 45K(2) was not confined to a contract notice under regulation 16(2)(b). The wording referred to a notice generally, and the contrast with the parallel public-contract provisions supported that construction (paras [29]–[32]). A qualification-system notice under regulation 16(2)(a)(ii) could therefore be the relevant prior notice.
3. The earlier qualification notice was objectively capable of being related to the tender procedure and the eventual contract, and had in fact initiated the competition. A materially altered contract might involve a breach of subsequent procurement procedure, but it did not mean that the required prior notice had never been given. The first ground was therefore unavailable (paras [33]–[42]).
4. Second ground. The four conditions in regulation 45K(5) were cumulative: breach of the standstill requirement; breach of another regulatory duty; deprivation by the standstill breach of the opportunity to commence or properly conclude proceedings before the contract; and an effect on the operator’s chances of obtaining the contract. The third condition was absent. Alstom had brought proceedings during the announced standstill period and had raised the substance of its material-variation case. The second ground was therefore unavailable, regardless of whether the asserted standstill breach existed (paras [44]–[58]).
5. Limitation. The reasons contemplated by regulations 45E and 33(9) related to the contract apparently resulting from the announced procurement process. They could be given even where the eventual contract was alleged to be materially altered (paras [68]–[70]). No particular written form was required. Information could be supplied orally, in several documents, or on several occasions, provided that it formed a sufficiently clear summary. The information supplied before and during the earlier injunction proceedings met that standard. The 30-day period therefore began on 4 December 2010 and had expired before the proceedings were issued (paras [66], [71]–[82]).
6. The ineffectiveness claim was struck out. Alstom was bound to fail, and a trial was unnecessary (para [83]).

The judgment records that Vos J dismissed Alstom’s interim injunction application on 29 October 2010: [2010] EWHC 2747 (Ch). The present court subsequently struck out the ineffectiveness claim.