Judge rules campaigners did not have standing to bring procurement challenge

Waverley Borough Council has persuaded a High Court judge that a group of councillors and local residents did not have standing to bring a judicial review claim that a contract with a developer had been varied in breach of procurement law.

The case of Wylde & Ors v Waverley Borough Council [2017] EWHC 466 (Admin) related to the ‘Brightwells’ regeneration scheme in Farnham. The local authority has long sought to redevelop the East Street area of the town.

The claimants comprised two Waverley councillors and three members of local civic societies that have been consistently opposed to the proposals.

They sought to challenge a decision by the full council at Waverley on 24 May to amend an agreement with its development partner, Crest Nicholson, reducing the amount payable for the land to make the scheme viable. The claimants contended that Waverley should have held a fresh competition for the contract.

However, the council and Crest Nicholson argued that the claimants could not bring themselves within the restricted scope for the test of standing in procurement claims established by the Chandler case.

Dismissing the application for judicial review, Mr Justice Dove said he was “quite satisfied” that the claimants were unable to demonstrate that they had standing to bring the claim.

“Firstly, albeit not in my view the most important point in the case, like the claimants in Unison, they have difficulty in showing that any competitive tendering exercise for the varied contract would produce a different outcome,” he said.

“Aside from the fact that that exercise would be for an economic operator to take up the varied terms in order to deliver the same scheme to which the claimants object, and thus no difference in terms of their concerns, the more significant point is that the VEAT Notice did not demonstrate that there was any competing interest available.” [There was no response from any economic operator to the council’s VEAT notice about the amendment]

The judge went on to say that, “far more centrally in relation to the issues which arise in respect of standing”, these claimants were unable to demonstrate any direct impact upon them which would arise from the conduct of a competitive tendering exercise.

“Not only are they not economic operators, but they are not remotely approximate to any economic operator, nor could they begin to demonstrate any interest in the procurement process which might be akin to or a proxy for status as an economic operator,” he concluded.

“Whilst, therefore, I have no doubt that the concerns and objectives of the claimants are entirely genuine and expressed by them in the public interest, that observation, and their interest as either council tax or rate payers or as members of local authorities, are not sufficient to establish that they were within the Chandler test and thus they do not have standing to bring this claim.”

Mr Justice Dove said he was unable to follow the approach to standing taken by Lang J in the case of R (Gottlieb) v Winchester City Council [2015] EWHC 231, which he considered to be wrongly decided.

In Gottlieb, a councillor at Winchester City Council won a High Court judicial review challenge over the local authority’s decision to adopt an updated scheme for a £165m city centre redevelopment without conducting a procurement exercise.

Cllr Julia Potts, Leader of Waverley Borough Council, said: “The judge’s ruling has backed what we believed was the right scheme for Farnham all along; to provide the town with new homes and an exciting retail and leisure offer, including an M&S and Reel cinema. This regeneration scheme will bring about major community benefits to our residents, visitors and local businesses and give the council a much needed income stream for many years to come.  

“The legal action brought against the council has had a significant effect on the timescales for the project as well as creating great uncertainty for the local community. Waverley has had to defend the case at considerable expense to local council taxpayers.”

Cllr Potts added: “Our ambition now is to move forward and provide a revitalized, vibrant centre for Farnham. We will deal with the consequences of what has passed and work with our development partner Crest Nicholson to get the scheme underway as soon as we can.”

Nigel Giffin QC, Jason Coppel QC and Patrick Halliday of 11KBW acted for Waverley Council in the Wylde case.