Practice Plus Group Health and Rehabilitation Services Limited v NHS Commissioning Board

When deciding whether to lift an automatic suspension in a procurement challenge, the court should consider four questions: whether there is a serious issue to be tried; whether damages would adequately compensate the claimant; whether damages would adequately compensate the contracting authority; and, if necessary, where the balance of convenience lies.

Damages will ordinarily be adequate where the claimant’s loss consists of calculable profits. A claimed reduction in the prospect of receiving a future contract is not a loss of chance where the claimant has not been excluded from a defined opportunity. Highly speculative, indirect or irrecoverable losses do not necessarily make damages inadequate. The court may also give substantial weight to the contracting authority’s assessment of the effect of delay on public functions and service users.

The defendant applied under regulation 96(1) of the Public Contracts Regulations 2015 to lift the automatic suspension imposed by regulation 95(1). The suspension arose from a procurement for integrated healthcare services in prisons.

The claimant challenged the proposed award of three lots to Oxleas NHS Foundation Trust, alleging breaches of procurement law, manifest error and irrationality. For the purpose of the application, the defendant accepted that there was a serious issue to be tried. The central questions were whether damages would be an adequate remedy for the claimant, whether they would be adequate for the defendant, and where the balance of convenience lay.

1. The application to lift the automatic suspension succeeded. Damages would be an adequate remedy for the claimant if its substantive claim ultimately succeeded.

2. Following Camelot UK Lotteries Limited v The Gambling Commission [2022] EWHC 1664 (TCC), the court adopted the four-stage inquiry: serious issue to be tried; adequacy of damages for the claimant; adequacy of damages for the defendant; and, where necessary, the balance of convenience.

3. The claimant’s profits from the contracts were capable of calculation. The claimed loss arising from possible future NHS procurement reform was not properly a loss of chance. The claimant had not been excluded from a defined opportunity; at most, its prospects of obtaining a future contract might be diminished. That was not a recoverable head of damage and was highly speculative.

4. The claimed risks concerning redundancies, innovation and reputation did not make damages inadequate. Redundancy losses were quantifiable. The innovation case concerned the use of profits and was irrelevant to the American Cyanamid inquiry. The evidence of reputational harm lacked sufficient specificity and did not establish significant financial losses that would be irrecoverable in damages.

5. Although unnecessary to the result, the court held that damages would be less adequate for the defendant. Delay would interfere with its statutory public functions and could adversely affect healthcare provision and prisoners’ welfare. If the issue had turned on the balance of convenience, that balance would strongly have favoured lifting the suspension, having regard to the proposed service improvements, mobilisation period, staffing effects and delay to trial.