BAM PPP Ireland Ltd and Balfour Beatty Ireland Ltd v National Roads Authority
| Jurisdiction | Ireland |
| Judge | Ms. Justice Baker |
| Judgment Date | 21 February 2017 |
| Neutral Citation | [2017] IEHC 157 |
| Court | High Court |
| Docket Number | [2015 No. 724 P] |
| Date | 21 February 2017 |
[2017] IEHC 157
THE HIGH COURT
Baker J.
[2015 No. 724 P]
Environment, Construction & Planning – Award of public contracts – European Communities (Award of Public Authorities' Contracts) Regulations 2006 – European Communities (Public Authorities Contracts) (Review Procedures) Regulations 2010 (Remedies Regulations) – Council Directive 89/665/EEC – Breach of contract – O. 84A of the Rules of the Superior Courts – Source of effective remedy
Facts: The plaintiffs had filed a claim for breach of contract against the defendant. The plaintiffs claimed that they were the preferred tenderer in relation to an award of public contract for the proposed construction. The plaintiffs alleged that the defendant had disclosed certain confidential information pertaining to the said tender to the competitor who was ultimately awarded the said public contract. The defendant argued that since the plaintiffs were seeking damages for breach of community procurement law, the appropriate course was to pursue the regime available under Remedies Regulations and not by issuing plenary summons. The plaintiffs on the other hand argued that they were pursuing a claim at common law for breach of contract and negligent misrepresentation.
Ms. Justice Baker held that the plaintiffs were required to pursue their claim by way of proceedings instituted under o.84A of the Rules of the Superior Courts and not by way of issuance of plenary summons. The Court held that the claim of the plaintiffs was based on an alleged unlawful step taken by the defendant while awarding the contract, which was a direct challenge to the decision to award the contract. The Court, thus, noted that the alleged breaches could be categorised as the breaches of rules and policies of the Community procurement law.
The plaintiffs acting collectively under the title BAM Balfour Beatty tendered for the award of a public contract advertised by the defendant for the design, construction, operation and maintenance of the Gort to Tuam motorway.
The defendant, the National Roads Authority (the “NRA”), is a statutory body incorporated under the Roads Act 1993 as amended, responsible inter alia for the construction of public roads in the State, and was at all material times a contracting authority within the meaning of the European Communities (Award of Public Authorities' Contracts) Regulations 2006, (“ the Public Contracts Regulations”) ( S.I. 329 of 2006), which implemented Council Directive 2004/18/EC.
The tender was made under the provisions created by the Public Contracts Regulations and the plaintiffs were a candidate within the meaning thereof.
The plaintiffs commenced proceedings by plenary summons on 30th January 2015 claiming damages for breach of contract, negligence and breach of duty, including damages for loss of opportunity and loss of chance, arising from what it pleads was the disclosure of commercially sensitive and confidential information by the defendant in the course of the tender process.
The claim arises from the happening of a series of events by which it is pleaded the defendant unlawfully disclosed certain confidential and commercially sensitive information. The plaintiffs had tendered for the contract in June, 2010, and had been identified as the preferred tenderer. The project did not proceed due to the financial crisis, but was reactivated in April, 2011.
The plaintiffs assert that in the time between the two processes some information regarding the “relative overall standings” of its tender and that of a rival competitor had been disclosed. It is accepted some disclosure was made in the course of verbal exchanges between agents of the defendants and the representatives of the two bidders. The plaintiffs say that whilst it is clear that its rival did receive some information pertaining to the status of its bid, that, contrary to assertions contained in correspondence form the NRA, it did not obtain any information regarding the competitor's tender.
The rival competitor was ultimately awarded the contract.
It is expressly pleaded that the second stage of the competition in 2011 was “a development” of the competition, i.e. that there was only one process.
The defendant has pleaded that the claim is not properly one that can be maintained by plenary action, as it was not brought by the procedures and within the time limits provided by O.84A of the Rules of the Superior Courts.
This judgment is given in the determination of an issue of law agreed to be determined as a preliminary issue on affidavit as follows:
Whether the plaintiffs were required to pursue the claims they make in the within plenary proceedings by way of proceedings initiated pursuant to O.84A of the Rules of the Superior Courts and/or in accordance with the time limits applicable to proceedings regulated by O.84A of the Rules of the Superior Courts and/or within a timely fashion.
The Public Contracts Regulations set out procedures for the award of works contracts by public authorities in Member States.
Procedures for the review by a court of a Member State of a decision by a contracting authority are set out in Council Directive 89/665/EEC of 21st December, 1989, the Remedies Directive, by which provision is to be made for what is described as “the coordination of the laws, regulations and administrative provisions relating to the application of review procedures to the award of public supply and public works contracts”.
The Remedies Directive was transposed by the European Communities (Public Authorities Contracts) (Review Procedures) Regulations 2010 S.I. No. 130 of 2010 as subsequently amended by S.I. 192 of 2015, (“The Remedies Regulations”)
Regulation 3 provides for the application of the Remedies Regulations to contracts and decision as follows:
“These regulations apply to decisions taken, after the coming in to operation by these Regulations, by contracting authorities in relation to the award of reviewable public contracts, regardless of when the relevant contract award procedure commenced.”
Regulation 4 identifies the persons to whom review procedures are available and states:
“For the purposes of these Regulations, a person is an eligible person in relation to a reviewable public contract if the person –
(a) Has, or has had, an interest in obtaining the reviewable public contract, and
(b) Alleges that he or she has been harmed, or is at risk of being harmed, by an infringement in relation to that reviewable public contract, of the law of the European Communities or the European Union in the field of public procurement, or of the law of the State transposing that law.”
The type of remedy available to an eligible person is set out in Regulation 8, and 8(b) provides:
“For review of the contracting authority's decision to award the contract to a particular tenderer or candidate.”
That the concept of “review” must be seen as having a Community meaning, and not to be confined to the meaning in domestic law, will be considered further later in this judgment.
Regulation 7 of the Remedies Regulations provides the relevant time limit of thirty days from the notification of the making of the making of the decision to award the contract as follows:
“Time limits for applications to Court
7.—(1) Subject to any order of the Court made under a rule referred to in Regulation 10(2), an application to the Court shall be made within the relevant period determined in accordance with this Regulation.
(2) An application referred to in subparagraph (a) or (b) of Regulation 8(1) shall be made within 30 calendar days after the applicant was notified of the decision, or knew or ought to have known of the infringement alleged in the application.
Provision is made in domestic law for the extension of time, but the present application does not engage those provisions.
The court hearing a review is given the powers set out in Regulation 9 as follows:
“9. (1) The Court—
(a) may set aside, vary or affirm a decision to which these Regulations apply,
(b) may declare a reviewable public contract ineffective, and
(c) may impose alternative penalties on a contracting authority, and may make any necessary consequential order.
(2) The Court may make interlocutory orders with the aim of correcting an alleged infringement or preventing further damage to the interests concerned, including measures to suspend or to ensure the suspension of the procedure for the award of a public contract or the implementation of a decision of the contracting authority.
(3) The Court may set aside any discriminatory technical, economic or financial specification in an invitation to tender, contract document or other document relating to a contract award procedure.
(4) When considering whether to make an interim or interlocutory order, the Court may take into account the probable consequences of interim measures for all interests likely to be harmed, as well as the public interest, and may decide not to make such an order when its negative consequences could exceed its benefits.
(5) The Court may by order suspend the operation of a decision or a contract.
(6) The Court may award damages as compensation for loss resulting from a decision that is an infringement of the law of the European Communities or the European Union, or of a law of the State transposing such law.”
For the purpose of the present application the relevant power is that to award damages, ancillary to, instead of and in addition to the other available remedies, including the making of an interlocutory order or the declaration that...
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John Casey v The Minister for Housing, Planning and Local Government, The Minister for State at the Department of Housing, Planning and Local Government, Ireland and The Attorney General
...as possible” (at p. 283). See also the discussion in BAM PPP Ireland Ltd and Balfour Beatty Ireland Ltd v. National Roads Authority [2017] IEHC 157. 59 . Another example is found in the amendment to the Planning and Development Act 2000 by s. 50A and later s. 32 of the Act of 2010 and s. 20......