Newcastle Upon Tyne Hospital NHS Foundation Trust v Newcastle Primary Care Trust & Ors

On an application to end the automatic suspension of a public procurement under regulation 47H of the Public Contracts Regulations 2006, the court applies the principles governing interim injunctions. The serious-question threshold is low and need not be finally determined where the application can be resolved on adequacy of damages and the balance of justice. The court may consider the public interest, including the effect of delay on the provision of essential services. Damages may be adequate for the claimant as an economic operator even though compliance with procurement duties serves an important public interest. Where continuation of the suspension would substantially delay a necessary service and force the contracting authority into an interim arrangement it considers unsuitable, the balance may favour lifting the suspension.

The claimant, an NHS Foundation Trust, challenged the defendants’ procurement of diabetic retinopathy screening services. It alleged breaches of the duties of equal treatment, non-discrimination and transparency, principally because the financial tender model referred to 80% of the total diabetic population although the relevant performance standard concerned eligible persons.

The defendants applied under regulation 47H to bring the automatic suspension of contract award proceedings to an end. The application required consideration of the interim-injunction principles, including whether there was a serious question to be tried, whether damages were adequate, and where the balance of justice lay.

1. Application succeeded. The automatic suspension was lifted under regulation 47H of the Public Contracts Regulations 2006.
2. The court applied the three-stage approach in American Cyanamid v Ethicon Ltd [1975] AC 396. The threshold of a serious question to be tried was low. The judge declined to determine the application on that issue, preferring to decide it by reference to damages and the balance of justice.
3. Although the claimant raised an arguable procurement complaint concerning the distinction between the total and eligible diabetic population, the claimant had not shown that damages would be inadequate for the loss it might suffer as an economic operator. The public interest in compliance with the Regulations did not itself make damages inadequate.
4. Damages would not be an adequate remedy for the defendants. Continuation of the suspension risked disrupting arrangements for diabetic retinopathy screening, including the provision of services to patients and the management of staff and contractors.
5. In assessing the balance of justice, the court could consider the public interest, following the approach identified in ALSTOM Transport v Eurostar International Ltd [2010] EWHC 2747 (Ch). The court could not determine at this interim stage which provider would best serve the diabetic population, nor require the defendants in practice to award an interim contract to the unsuccessful bidder.
6. A speedy trial was not realistically available because disclosure had not occurred, expert evidence and statistical issues required investigation, and the claim involved novel legal issues with a possible risk of amendments or appeals. A delay of a year or more to a three-year service contract was significant. The balance of justice therefore favoured lifting the suspension.