Smart Telecom Plc trading as Smart Telecom v Radio Teilifis Eireann & Anor,  IEHC 176 (2006)
|Docket Number:||2006 1865P|
THE HIGH COURT
COMMERCIAL[2006 No. 1865 P]BETWEEN SMART TELECOM PLC
TRADING AS SMART TELECOMPLAINTIFFand
RADIO TEILEFÍS ÉIREANN
AND BY ORDER GLANBIA PLCDEFENDANTS JUDGMENT of Mr. Justice Kelly delivered on the 26th day of May, 2006
Given the frequency with which the weather forecast predicts dreary wet weather, the enthusiasm of commercial enterprises to sponsor it may come as a surprise. This litigation is all about attempts to become its sponsor as broadcast by the first defendant (R.T.E) over the next two years.
The current sponsor of the weather forecast on R.T.E is Eircom. Its contract expires in June, 2006.
On 5th April, 2006, R.T.E indicated that the weather forecast was available for sponsorship at a price of 1.25 million per annum for a minimum period of two years. Four parties indicated a willingness to sponsor the forecast on those terms. Two of these are known and the others not. One was the plaintiff (Smart) and the other, the second defendant, (Glanbia).
Faced with such an embarrassment of riches R.T.E sent an email (the R.T.E offer) to the four interested parties on the morning of 7th April, 2006. As this email is of crucial importance in this litigation I will set it out in full. It reads:-"Thank you for your expression of interest in the Sponsorship of R.T.E television weather. As a number of companies have met the asking price of 1.25 million per year for a minimum two year deal, we are obliged, in the interest of fairness and transparency, to hold a competition.
We now invite you to submit your best offer in the form of a sealed bid. You need to clearly state what price you will commit to for this contract - per annum and in total for the two year period under negotiation. It is to be understood that your best offer is a gross figure, inclusive of agency commission. The contract will be awarded to the highest bidder. In the event of more than one identical highest offer, we will enter into a second round offer with these companies only.
Bids should arrive at R.T.E before the deadline of 4.00 p.m. today, Friday April 7th, 2006 and be addressed to Robby Hill, Purchasing Manager, Stage 7, R.T.E, Donnybrook, Dublin 4. Please include the reference 'R.T.E. Weather' clearly on the front of the envelope, along with your company name. You will receive confirmation that your bid has been received directly from the Purchasing Manager upon receipt.
All bids will be opened at a meeting with the Purchasing Manager and a company auditor. All companies will be notified of the result by 5.00 p.m. today. In the event of a second round being necessary, this will not take place until early next week.
Thank you again for your interest in this highly sought after property. Please acknowledge receipt of this email.
Gerry." The signatory of this email was Mr. Gerry McGuinness who is R.T.E's sponsorship manager.
Smart responded in two different ways. Both responses are short but neither are models of lucidity.
A subsidiary of Smart, called Smart Telecom Holdings Limited (Holdings) (which was not one of the four original interested parties) sent an email to R.T.E on 7th April, 2006. It was in the following terms:-"We refer to your email of 7th April, 2006, requesting and soliciting offers in the form of a sealed bid for a two year deal in respect of sponsorship of R.T.E television weather. It is noted the contract will be awarded to the highest bidder with the result being notified by 5.00 p.m. today with no further bidding unless an identical highest offer is received.
We confirm our agreement to bid the sum of 1,5100,000 (sic) on behalf of our company." On the same day, Smart, through its Chief Executive, Mr. Oisin Fanning also wrote to R.T.E in the following terms:- "We refer to your email of 7th April, 2006, requesting and soliciting offers in the form of a sealed bid for a two year deal in respect of sponsorship of R.T.E television weather. It is noted the Contract will be awarded to the highest bidder with the result being notified by 5.00 p.m. today with no further bidding unless an identical highest offer is received. We confirm our agreement to bid a sum equal to 5% above the highest priced bid received by you by (sic) any other business for the minimum two year deal." GLANBIA'S RESPONSE
On 7th April, 2006, a company called OMD Ireland, on behalf of Glanbia, submitted a bid in the following terms:-"On behalf of Glanbia Consumer Foods we wish to bid 1,595,500 per annum (gross of agency commission), minimum commitment two years, in respect of R.T.E weather, i.e 3,191,000 for the two years."THE 4.00 p.m. DEADLINE
All of the above responses were received prior to the deadline of 4.00 p.m. on 7th April, 2006.
During the morning of 7th April, 2006, an agent representing one of the other parties to whom the R.T.E offer had been sent, telephoned Mr. McGuiness of R.T.E. That person enquired whether a bid "where the price being offered by the bidder was a specific amount over and above the highest fixed sum bid made by another bidder" would be accepted. Although this enquirer did not use the term "referential bid" it is clear that was the subject of his enquiry. Mr. McGuiness conferred with two other officials in R.T.E and confirmed that such a bid was not permissible. An email was sent to that enquirer in the following terms:-"Subject:Re: Weather Sponsorship
In relation to your question about 'type' of bid, the email requests that you clearly state what price you will commit to etc. This price must be a specific figure which is clear in isolation. Therefore it cannot be along the lines of 'best received bid plus 1K'.
I hope that is clear.
Gerry." R.T.E did not inform the other bidders of this enquiry or the response thereto.
EVENTS POST 4.00 p.m.
All sealed bids which had been received were opened after 4.00 p.m. on 7th April, 2006. They included the bids from Smart and Holdings and Glanbia, to which I have already referred. There were also sealed bids from the other parties who had been invited to bid. All of the bids received were in fixed monetary amounts in Euro and specified the Euro amount bid per annum for each of the two years in question, save for the bids made by Smart and Holdings.
The bid from Holdings mentioned a sum of 1,5100,000 (sic) and did not indicate whether that was per annum or for the two year period.
Quite clearly this was not a bid which was made in accordance with the terms of the R.T.E offer. R.T.E would have been quite justified in regarding it as invalid. In ease of Holdings however it took a different course to which I will refer in a moment.
The Smart bid was considered invalid. This was consistent with the response made to the enquirer earlier in the day as to the unacceptability of referential bids.
Accordingly, Mr. Robert...
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