Bechtel Ltd v High Speed Two (HS2) Ltd

In a procurement challenge under the Utilities Contracts Regulations 2016, the court exercises a supervisory jurisdiction. It does not re-evaluate tenders or substitute its own scores for those of specialist evaluators. Intervention requires manifest error, broadly equivalent to irrationality, or another established breach such as unequal treatment or lack of transparency.

The reasonably well-informed and normally diligent tenderer standard is objective. An alignment requirement promotes consistency between responses but does not create hidden cross-cutting criteria. Abnormally low tenders are assessed by reference to the particular contract and remain subject to the contracting authority’s margin of judgment. A utility may reject a tender containing a commercially unacceptable qualification that materially shifts risk. Permitted post-tender clarification and minor contractual refinements do not require a fresh competition.

Bechtel challenged HS2’s procurement of the Construction Partner contract for Old Oak Common Station. Bechtel alleged errors and unequal treatment in the scoring of its tender and the winning BBVS tender, failure to investigate an allegedly abnormally low tender, inadequate record keeping, impermissible post-tender changes, and failure to abandon or rerun the competition.

HS2 denied breach and relied additionally on a qualification in Bechtel’s tender which materially altered the proposed allocation of budget and programme risk. The trial concerned liability, breach and causation. Remedies and any declaration of ineffectiveness were reserved for a later stage if necessary. The central questions were whether the evaluation and subsequent steps complied with the procurement rules and whether Bechtel could establish a causative breach.

1. Outcome. The claim failed. Bechtel’s qualification to clause 6.2 substantially shifted the contractual risk concerning the Incentive Target and Programme Target. It gave Bechtel leverage to renegotiate or terminate at the consolidation point. Under the ITT, HS2 had a general right to reject a commercially unacceptable qualification exposing it to significantly greater risk or distorting equal treatment. That right was not conditional upon a formal Withdrawal Ultimatum. Had Bechtel won the evaluation, HS2 would have required withdrawal and, on the evidence, would have disqualified Bechtel when it maintained the qualification.
2. The court applied the supervisory approach described in Woods Building Services v Milton Keynes Council [2015] EWHC 2011 (TCC), Stagecoach East Midlands Trains Ltd and others v Secretary of State for Transport [2020] EWHC 1568 (TCC) and Healthcare at Home Limited v The Common Services Agency [2014] UKSC 49. The court would not re-mark the tenders. The RWIND standard was objective, and the evaluators retained a margin of discretion.
3. No manifest error, lack of transparency or unequal treatment was established in the evaluation. The Alignment Factor required consistency between responses, but did not require the concerns about BBVS’s resources in E001 to be carried into every other technical score. Each question remained stand-alone, and the court would not introduce practical achievability as an unpublished criterion. Draft scores were preliminary and did not have priority over the moderated consensus scores.
4. There was no separate duty of good administration owed by HS2. The relevant duties were those of equal treatment and transparency. Under the Utilities Contracts Regulations 2016, an abnormally low tender was assessed by reference to the particular contract. The MRS did not feed into price or cost, the Fee Collar was 7%, and BBVS’s fee, rates and resources were not abnormally low.
5. The 5 September 2018 meeting was a permitted clarification meeting. The resource reassurances and explanation of the 175% entry in the MRS did not alter the tender or justify revisiting the scores. HS2 did breach transparency by failing to keep proper minutes, but the breach was technical and did not affect the outcome. The core evaluation records enabled the court to exercise its supervisory jurisdiction.
6. The revised dates and consequent MRS changes were expressly permitted refinements under the negotiated procedure and the ITT. They did not materially change the contract, alter its economic balance or require a fresh competition. All claims therefore failed, and judgment was for HS2.