Does abandoning a tender defeat a bidder’s claim?

Under the Public Contracts Regulations 2015, bidders who are successful in establishing that a public body has breached its duties in the running of a regulated tender are entitled to recover damages. Other remedies may also be available, depending on whether a contract has been entered into or not by the public body.

But what if, after a challenge has been brought, the public body decides to abandon the tender? Does this defeat the bidder’s claim to damages?

This is the question the High Court recently had to consider in the case of Amey Highways Limited v West Sussex County Council. Amey had challenged the outcome of a highways contract which had been awarded to another bidder which scored just 0.03 more points than Amey. Amey contended that the Council had acted in breach of the Regulations in evaluating the tenders; and that had it not been for the Council’s breaches, it would have scored higher and should therefore have been awarded the contract.

After Amey’s claim had been issued, it successfully resisted an initial attempt by the Council to have the claim struck out. At that stage, concerned by the risks involved in continuing the litigation, the Council decided to abandon the procurement and re-tender the contract. Its expectation and intention was that abandoning the procurement would have the effect of bringing Amey’s claim for damages to an end.

However, the Court decided that the decision to abandon the tender did not have any effect on Amey’s claim. There was no suggestion that Amey would not have been awarded the contract, if they were correct in showing that they should have received higher marks. In addition, there was no evidence that the Council would have decided to abandon the procurement in any event, had it not been for the claim – the sole driver of the decision to abandon had been the hope that this would extinguish Amey’s claim.

The court decided that the Council’s decision to abandon, although it might have had the effect of depriving a bidder of a claim which had not come into existence until after the decision, did not have any impact on a cause of action which had already accrued before the date of the decision.

Public bodies will need to consider the impact of this decision carefully when deciding how to deal with procurement challenges, and be aware that abandoning a tender will not always be a get out of jail free card: a disgruntled bidder may still have the right to claim damages, even after a procurement has been abandoned and re-started.