BY Development Ltd & Ors v Covent Garden Market Authority

In a public procurement challenge based on manifest error, unfairness or unequal treatment, the court performs a limited review. It does not re-mark competing tenders or substitute its own assessment for that of the contracting authority. Expert evidence is therefore generally inadmissible where it seeks to re-run the evaluation or express an opinion that the authority was manifestly wrong. It may nevertheless be admitted exceptionally where it provides necessary technical explanation, addresses a specific and discrete evaluation criterion, or concerns causation. The question is fact-sensitive. Evidence directed to hypothetical planning outcomes, the merits of the bids as a whole, or alleged unfairness will ordinarily usurp the court’s function. The application was refused because the proposed planning and financial evidence concerned the entire evaluation process and was neither relevant nor admissible.

The claimants challenged the defendant statutory corporation’s decision to reject their tender for the redevelopment of the New Covent Garden Market site and to award the development contract to VSM. They alleged manifest errors in the evaluation, particularly concerning planning and finance, and alternatively unfairness or unequal treatment.

At a case management hearing, the claimants sought permission to adduce planning and financial expert evidence at trial. The proposed questions addressed planning compliance, planning risk, tariff and Community Infrastructure Levy assumptions, hypothetical planning outcomes, financial risk, internal rates of return, guarantor credit ratings and equity exposure. The issue was whether such evidence was admissible or relevant to the procurement challenge.

1. Application refused. Expert evidence addressing the questions formulated by the claimants was neither admissible nor relevant. The parties were invited to agree the appropriate costs order.
2. Under the Public Contracts Regulations 2006, the court’s task in reviewing a procurement evaluation is limited to determining whether the contracting authority made a manifest error or acted unfairly or with unequal treatment. The court does not conduct a comprehensive review or substitute its own assessment of the rival bids.
3. The manifest-error approach gives the authority a margin of appreciation in matters of judgment and assessment. That margin does not extend to compliance with obligations of equality, transparency and objectivity. A manifest error is an error which has clearly been made.
4. Expert evidence is generally inadmissible in such proceedings. It may be permitted exceptionally where it explains a genuinely complex technical field, addresses a specific and discrete evaluation issue, or concerns causation. It must not invite a debate between competing experts, re-mark the tenders, or express the expert’s opinion that the authority’s conclusion was irrational.
5. The proposed evidence was not explanatory technical evidence. It was directed to the merits of the bids and the evaluation as a whole. In particular, evidence about what a local planning authority might hypothetically have done with a future planning application would not assist the court in deciding whether the defendant’s assessment of planning risk contained a manifest error. Expert evidence on unfairness or unequal treatment was also difficult to envisage as admissible.

Not stated in the judgment.