Word Perfect Translation v Minister for Public Expendituire & Reform

• Jurisdiction: Ireland
• Judge: O'Donnell J.
• Judgment Date: 27 May 2019
• Neutral Citation: [2019] IESC 38
• Court: Supreme Court
• Docket Number: [S:AP:IE:2018:000111],[S.C. No. 111 of 2018]
• Date: 27 May 2019

IN THE MATTER OF THE REVIEW OF THE AWARD OF A PUBLIC CONTRACT PURSUANT TO THE EUROPEAN COMMUNITIES (PUBLIC AUTHORITIES' CONTRACTS) (REVIEW PROCEDURES) REGULATIONS 2010 AND ORDER 84A OF THE RULES OF THE SUPERIOR COURTS (AS AMENDED)

BETWEEN:

WORD PERFECT TRANSLATION SERVICES LIMITED

Applicant/Respondent

AND

THE MINISTER FOR PUBLIC EXPENDITURE AND REFORM

Respondent/Appellant

[2019] IESC 38

O'Donnell Donal J.

O'Donnell Donal J.

McKechnie J.

MacMenamin J.

Dunne J.

Finlay Geoghegan J.

[S:AP:IE:2018:000111]

THE SUPREME COURT

Public contract – Evaluation decision – Manifest errors – Applicant seeking a review of the award of a public contract – Whether the evaluation decision contained manifest errors

Facts: The applicant/respondent, Word Perfect Translation Services Ltd, commenced proceedings pursuant to the European Communities (Public Authorities’ Contracts) (Review Procedures) Regulations 2010 (S.I. No. 130/2010), seeking a review of the award of a public contract to the successful tenderer, Translation.ie, on a number of grounds. In the Supreme Court, the dispute narrowed to two issues. Word Perfect contended, and the Court of Appeal agreed, that the evaluation decision contained manifest errors in both awarding Translation.ie the full 250 marks in respect of the Service Delivery Plan, and in awarding 170 marks to Translation.ie on the Quality Assurance Plan. By a determination issued on 23 October 2018, leave to appeal to the Supreme Court was granted (subject to any refinement or argument at case management) on the following issues: “What is the test by which a tender award under public procurement legislation may properly be reviewed by a court and was that test met in respect of the two grounds as to narrative statement and professional development whereby the tender award was overturned by the Court of Appeal?”

Held by O’Donnell J that the applicable test was that first set out by Fennelly J in SIAC Ltd v Mayo County Council [2002] 3 IR 148: that is, a test of whether the decision is vitiated by manifest error. The main dispute in this case was whether the test had been correctly applied in the judgment under appeal and O’Donnell J concluded that, in one respect, namely the evaluation of the successful tender in respect of the Quality Assurance Plan, there was a manifest error, and accordingly the decision must be set aside.

O’Donnell J held that the appeal of the respondent/appellant, the Minister for Public Expenditure and Reform, against the decision of the Court of Appeal would be dismissed.

Appeal dismissed.

Judgment of O'Donnell J. delivered the 27th day of May, 2019

Introduction

1 The Office of Government Procurement (‘the OGP’) operates as an office of the Department of Public Expenditure and Reform, with responsibility for sourcing all goods and services on behalf of the public service. On 12 October 2015, the OGP published a request for tenders to establish a multi-supplier framework agreement (‘the Framework Agreement’) for the provision of interpretation services (excluding Irish) in the public service. The Framework Agreement was established on 25 January 2016, and contained eight lots. These proceedings concern Lot 4, which was for the provision of interpretation services to the immigration services, including, inter alia, the Refugee Appeals Tribunal, and to the Legal Aid Board. Three entities were appointed to Lot 4, including Word Perfect Translation Services Limited (‘Word Perfect’) and Forbidden City Limited, trading as Translation.ie (‘Translation.ie’). Word Perfect is the applicant in these proceedings and respondent to the present appeal, and Translation.ie is the successful tenderer in the mini-competition which is the subject of the proceedings.

2 It appears that a first mini-competition under Lot 4 was cancelled after a dispute arose, and a second mini-competition was commenced by revised supplementary request for tender (‘the SRFT’) issued on 7 December 2016, with an initial deadline for receipt of tenders of 6 January 2017. Following a process of clarification, amendments were made to the award criteria and the scoring scheme and the deadline was extended to 17 January 2017. The estimated value of the mini-competition was €300,000 to €600,000, and the term of the contract was to be for one year. It is a sobering thought that, while this case is being prosecuted by the parties and the courts involved with considerable speed and efficiency (the High Court and the Court of Appeal having produced comprehensive judgments on the substantive issues as well as a number of important interlocutory matters), the time period for the intended contract has now lapsed, and the costs involved in litigation must surely be out of all proportion to the value of the contract to the State parties involved and the respective tenderers. While the regime of public procurement and judicial review of awards is an important and beneficial scheme in ensuring fairness, objectivity and relative transparency in the award of public contracts, it is important that the process be capable of functioning in an effective manner, and ensures that the public service obtains the benefit of the services tendered for.

3 On 18 April 2017, Word Perfect was notified that Translation.ie was the preferred tenderer. The letter of 18 April 2017 also informed Word Perfect of the relative marks achieved by it and the preferred tenderer. Importantly, the letter showed that the result had been very close: out of a total of 1,000 marks available, Translation.ie had achieved 885 marks and Word Perfect 870, a margin of 15 marks from 1,000. While the marking scheme was clearly weighted 75 to 25 between quality of service and cost, it was nevertheless clear that Word Perfect had made the most financially attractive offer, and had received the full 250 marks available for cost, whereas Translation.ie had scored only 166 in that section.

4 Word Perfect then commenced these proceedings pursuant to S.I. No. 130/2010 - European Communities (Public Authorities” Contracts) (Review Procedures) Regulations 2010 (‘the 2010 Regulations’), seeking a review of the award on a number of grounds. In this court, the dispute has, however, narrowed to two issues. First, under the heading ‘Service Delivery Plan’ in the SRFT, Translation.ie had scored full marks of 250, whereas Word Perfect had been awarded 197.5. The reason for Word Perfect's lower score was explained. The tender submitted had exceeded the mandatory word limit by 37 per cent. Accordingly, only the first 2,000 words of Word Perfect's tender under this heading had been taken into account. Furthermore, the letter gives the following additional explanation:-

‘Translation.ie (250 marks)

An excellent response covering all the requirements set out in the SRFT, demonstrating a clear understanding of the business requirements of clients and providing convincing and comprehensive evidence of ability to provide robust and flexible provision of a sustainable, consistently high quality, reliable service on a 24/7/365 basis. The proposal contained clear information on methods employed to ensure interpreters retain their skills.

Your tender (197.5 marks)

A very good response in relation to reliability of service in the proposal to meet urgent requests, providing a detailed outline as to how bookings will be received, confirmed and activated on a 24/7/365 basis. However, your response did not include any proposal in respect of the methods employed to ensure that interpreters will retain their skills in the language and remain up to date with their practice and fluency to a sufficient standard to ensure effective delivery of the service in all four language groups.’

5 A second area of controversy related to the Quality Assurance Plan. Here, 200 marks were available, and Word Perfect, with full marks, had outperformed Translation.ie, which had achieved 170. Here, however, the reasoning offered was more limited. The obligation under Regulation 6(3)(a) of the 2010 Regulations was that the notice to the unsuccessful tenderer should include ‘the characteristics and relative advantages of the tender selected’ (emphasis added). Accordingly, the letter of 18 April 2017 noted that the Word Perfect tender had been an ‘excellent response with excellent use of visualisation tools. A very comprehensive easy to understand narrative summary is also provided. Fully meets requirements’. The explanation in relation to Translation.ie was simply: ‘[a]s your tender scored higher than the successful bidder, there are no relative advantages’. The same text was repeated in the second portion of the Quality Assurance Plan relating to complaints management. While it was argued in the High Court (see [2018] IEHC 237) and the Court of Appeal (see [2018] IECA 156) that this failed to sufficiently comply with the obligation to set out reasons, this argument failed in both courts, and, in the event, was not pursued on this appeal. As Hogan J. pointed out in the Court of Appeal in the substantive judgment, and also in the interlocutory judgment delivered on the question of discovery, the directives and implementing regulations must find a balance between the fact that the tender process encourages parties to submit commercially sensitive information, and the necessity of nevertheless permitting a full challenge to a decision. This balance may necessarily curtail the amount of information disclosed in the notice to the unsuccessful tenderer.

6 While it will be necessary to return later to the issues arising in relation to the Service Delivery Plan and the Quality Assurance Plan in much greater detail, at this point it is sufficient to note that Word Perfect contended, and the Court of Appeal agreed, that the evaluation decision contained manifest errors in both awarding Translation.ie the full 250 marks in respect of the Service Delivery Plan, and in...