The Good Law Project (R on the application of) v The Secretary of State for Health and Social Care

A contracting authority may use a negotiated procedure without prior publication where extreme urgency satisfies regulation 32(2)(c) and that procedure is strictly necessary. Strict necessity requires an evaluation of all the circumstances. It does not invariably require use of an existing supplier, comparison of alternative suppliers or selection through an accelerated procedure.

The apparent-bias test considers whether all relevant circumstances would lead the fair-minded and informed observer to find a real possibility of bias. Where a direct award was lawfully and urgently made, the common law did not impose a separate requirement to document objective selection criteria or undertake a comparative exercise. The observer may consider explanations and facts established during the court’s investigation, even if they were not recorded or publicly available when the decision was made.

The Minister appealed from the partial allowance of a judicial review claim concerning the direct award of a communications and focus-group contract during the Covid-19 emergency. The Technology and Construction Court, in [2021] EWHC 1569 (TCC), upheld reliance on regulation 32(2)(c) of the Public Contracts Regulations 2015 but held that the award gave rise to apparent bias.

The claimant cross-appealed, arguing that the direct award was not strictly necessary because of available suppliers and the contract’s duration and scope. The principal questions were whether the regulation 32 exception was satisfied and whether the absence of a comparative exercise or contemporaneous record would lead the fair-minded and informed observer to find a real possibility of bias.

1. Disposition. The Minister’s appeal was allowed and the claimant’s cross-appeal was dismissed. The declaration based on apparent bias could not stand.
2. The cross-appeal under regulation 32(2)(c) of the Public Contracts Regulations 2015 failed. Whether a negotiated procedure is strictly necessary is an evaluative question determined from the complete factual circumstances. The test is not subject to a rule that an authority facing extreme urgency may contract only with an existing supplier. The judge was entitled to find that the urgently required services justified contracting with the selected supplier.
3. The six-month duration was not shown to exceed what was strictly necessary. That question had to be assessed without hindsight and in the uncertainty prevailing during the emergency. The authority had reduced a proposed nine-month period to six months. The pay-as-you-go and termination provisions also reduced the significance of the maximum duration. The broadly expressed contractual scope was unobjectionable. Any allegedly improper later extension concerned performance or modification rather than the original procurement decision.
4. A lawful negotiated procedure with one supplier under regulation 32 may dispense with competition and with provisions which presuppose competitive tendering. The applicability of other Part 2 provisions remains fact-sensitive. Regulation 67 did not require a competitive evaluation where a single-supplier procedure was justified.
5. Assuming that common-law apparent-bias principles applied, the judge’s findings did not establish bias. The personal and professional connections did not themselves create apparent bias. Regulation 32 imposed no obligation to compare other agencies. The common law did not create a reduced procurement regime requiring a formally documented comparison merely to avoid an appearance of bias.
6. The fair-minded and informed observer would know the emergency context, the need for immediate and reliable work, the expertise and availability of the selected supplier, and the reasons why alternatives were unsuitable. Such an observer would neither infer bias from the absence of a comparative exercise nor treat the absence of a formal contemporaneous record as indicative of bias.
7. A decision-maker cannot defeat a bias allegation merely by asserting an open mind. Nevertheless, evidence of what the decision-maker knew and considered remains relevant. The informed observer may take account of facts established through the court’s investigation; those facts are not confined to publicly available information or contemporaneous records.

1. Court of Appeal (Civil Division): In [2022] EWCA Civ 21 , allowed the Minister’s appeal against the apparent-bias finding and dismissed the claimant’s cross-appeal concerning regulation 32.
2. High Court, Technology and Construction Court: In [2021] EWHC 1569 (TCC), dismissed the challenges to reliance on regulation 32 and to the contract’s duration, but allowed the claim based on apparent bias.