High Court lifts automatic suspension in procurement dispute over provision of audio-visual equipment to courts and tribunals

The Secretary of State for Justice (SoSJ) has successfully applied to the High Court for the lifting of the automatic suspension in a procurement challenge to the outcome of a mini-competition for a call-off contract relating to the provision of digital and audiovisual ('AV') equipment for use by HM Courts and Tribunals Service.

The SoSJ’s application had been resisted by the claimant, Boxxe, the unsuccessful tenderer which had applied for an expedited trial.

The background to the procurement dispute is that on 11 August 2022, the MoJ sued an Invitation to Tender for a call-off contract for the AV. The eventual supplier would be required to provide the equipment specified by the SoSJ in the ITT. It would also be required to provide storage, in a secure facility, for the equipment ordered by the Ministry until such time as it required it to be delivered to one of its sites. While the equipment remained with the supplier or in transit, the supplier would be entirely responsible for its security and would be liable for any loss, theft, or damage to it. A minimum of three months' free storage was required to be provided by the supplier.

On 13 December 2022, the defendant decided to award the contract to Specialist Computer Centres Plc, whose weighed score was 91.76% compared to Boxxe’s score of 88.27%

In feedback Boxxe was told: “The Successful Tenderer bid a price of £0 for storage service pricing. As this was the lowest priced bid, the Successful Tenderer scored the full 5% in accordance with the Further Competition Invitation. Your storage service price, using the calculation set out in the Further Competition Invitation was therefore scored as 0%.”

Boxxe's claim is that, on the Secretary of State’s interpretation and application of the competition rules, the contract was awarded to SCC not because SCC was the most economically advantageous tender ('MEAT'). Rather, Boxxe claims that it was awarded to SCC as a result of what it describes as an arithmetic quirk within the pricing model that led to a perverse outcome i.e. the contract being awarded to a bid that was over £1m higher, without, it is said, any rationale.

Boxxe’s claim was issued on 12 January 2023. The challenge to the evaluation of storage pricing was set out over seven grounds, summarised by Mr Justice Constable as follows:

• Ground 1: SCC's bid was non-compliant, in that it failed to comply with the requirement to provide a substantive storage cost and/or involved price manipulation. It should be noted that, in use of the word 'manipulation', Boxxe does not intend to imply anything underhand, nefarious or dishonest. It is said that on account of this, SoSJ [the Secretary of State for Justice] was required to disqualify the bid and breached its duty by failing to do so.
• Ground 2: described as 'undisclosed evaluation criteria', Boxxe allege that the pricing formula ought to have been applied to all of the bids with all of the bids (for storage) being scored 0, and thereby levelling the playing field.
• Ground 3: SoSJ failed to award the Contract to the MEAT, but instead awarded the Contract to the higher priced bid, as a result of the manipulation of the scoring.
• Ground 4: SoSJ manifestly erred in failing to award the contract to MEAT;
• Ground 5: SSC's bid was an 'abnormally low tender'. SoSJ failed to conclude that this was the case as it would have done if the tender had been properly investigated. Following such inquiries, it would have been irrational and unlawful for SoSJ to take any step other than disqualify SCCP's bid on the grounds that it was non-compliant.
• Ground 6. There was unequal treatment because SoSJ required Boxxe to provide a price for each element of the bid, even where the costs were notional only, and that SCC was not required to do so similarly.
• Ground 7. SoSJ erred in including in the evaluation HDMCI to HDCI converters, which on Boxxe's design would be unnecessary.

Each of the grounds was resisted substantively by the Ministry of Justice. It was also said that the claims have been brought outside the 30 day limitation period required by regulation 92 PCR.

In Boxxe Ltd v The Secretary of State for Justice [2023] EWHC 533 (TCC) Mr Justice Constable found that the course of action which was likely to carry the least risk of injustice was to lift the automatic suspension:

(1) If the suspension was lifted, damages would be an adequate remedy for Boxxe if it succeeded at trial, “especially so given the undertaking offered by SoSJ in relation to the Francovich issue, and which I consider ought be provided”;

(2) If the suspension was not lifted, with or without an expedited trial, SoSJ would sustain losses caused by the ongoing delays which are real and which cannot be compensated for by damages…..

(3) It was correct that the public interest pointed, “as it often does, in both directions – both for the implementation of the Competition as planned and as soon as possible, but also for SoSJ not overpaying for those services by reason (if Boxxe is right) of a flawed procurement process”;

(4) SSC would be impacted adversely.

Mr Justice Constable said: “For these reasons, the application to lift the suspension succeeds, on terms that if it is ultimately established as a matter of fact that a breach or breaches took place but for which, had they not occurred, the contract would have been awarded to Boxxe rather than SCC, SoSJ will not pursue its pleaded averment that the breach(es) do not meet the Francovich conditions.”