Hossacks (A Firm of Solicitors) v The Legal Services Commission

In a competitive public tender, a contracting authority may reject an application that is incomplete, submitted on the wrong form or contains fundamental inaccuracies. The court must respect the published tender rules and the requirements of equal treatment, transparency and proportionality.

Clarification may be appropriate for a genuine ambiguity or an obvious minor error. It cannot be used to supply wholly omitted mandatory information, reconstruct the substance of a bid, withdraw other bids, or improve an applicant’s prospects after the closing date. Equal treatment requires comparison with tenderers in materially similar circumstances. Evidence that other applicants received clarification does not establish inconsistency where their circumstances were materially different.

The claimant, a specialist community-care solicitor, sought judicial review of the Legal Services Commission’s rejection of 124 of its 125 bids in a 2010 competitive tender for publicly funded legal services. The bids used a form headed for the wrong procurement area, omitted office details and stated that services would be provided from part-time offices. The claimant in fact maintained a full-time office in Northamptonshire.

The Court of Appeal granted permission on limited grounds concerning the Northamptonshire bid: whether rejection was unreasonable or disproportionate, whether clarification should have been sought, and whether the Commission had treated the claimant inconsistently with other tenderers. The central issue was whether the defects could be clarified or corrected without unlawfully changing the tender.

1. The application was dismissed. The Commission had acted reasonably and proportionately in rejecting the Northamptonshire tender.
2. The tender had to be assessed in accordance with the published Information for Applicants and as part of the claimant’s 125 bids. Replacing the reference to Wiltshire with Northamptonshire would not cure the omissions or inaccuracies. The claimant had omitted the office address, had used the same form across all areas and had supplied insufficient information to establish eligibility.
3. The tender rules required applicants to provide information even where the Commission already possessed it independently. The claimant had warranted the accuracy of the information submitted. Awarding a contract on the false premise that a part-time office would operate in Northamptonshire would therefore have been impermissible.
4. The duty of equal treatment and transparency prevented the Commission from allowing a tenderer to improve a bid after the closing date. Clarification could address a genuine ambiguity or obvious error, but the requested intervention would have reconstructed the essence of the application and potentially withdrawn 124 bids.
5. The claimant failed to establish inconsistent treatment. Other cases in which clarification had been sought concerned materially different matters, such as inconsistencies in eligibility information or technical failures. Applicants who used the wrong form or omitted mandatory tender information had been rejected in the same way.
6. The court recognised that judicial review remained available where a public-law issue arose, notwithstanding a possible damages remedy, but the court’s role in an objective commercial tendering exercise was constrained by the published rules and applicable regulations.

• Court of Appeal granted permission on limited grounds on 8 July 2011. The citation given in the judgment is [2011] EWCA Civ 788.
• High Court (Administrative Court) dismissed the judicial review application.