High Court adopts a permissive approach to amendments in a procurement dispute
Accessible Orthodontics (O) Limited v National Health Service Commissioning Board; Accessible Orthodontics LLP v National Health Service Commissioning Board  EWHC 785 (TCC)
In 2018, two unsuccessful bidders in a procurement for orthodontic services issued claims against the NHS Commissioning Board (known as NHS England (NHSE)), alleging breaches of the Public Contracts Regulations 2015 (PCR) in the way in which bids had been evaluated.
In March 2020, the bidders applied to the High Court to amend their statements of case, to add new grounds for complaint. The amendments related primarily to information received in September 2019, during the course of the legal proceedings, as a result of disclosure of evaluator and moderation notes. The bidders also sought to challenge, for the first time, the scores awarded to the winning bidder. The hearing took place on 21 April 2020.
The question to be resolved was whether or not the new complaints constituted a new breach of the PCR, which would have required a new claim to be brought. If this were the case then the new claims would have been time barred as they were brought after the strict limitation periods in the PCR. However, if the court decided that they constituted additional particularisation of an already pleaded breach it would have the discretion to allow them.
In the end, the court concluded that the amendments were simply additional particulars of the already pleaded cases rather than new claims. As such, the court used its discretion to permit the additional allegations.
This judgment is a surprising one which does not reflect the common practice in procurement disputes of claimants amending their statements of case within the 30 day limitation period as disclosure is given. In this case the court adopted a liberal approach towards allowing amendments to the statement of case to bring in new complaints even when a considerable period had elapsed since the grounds for the complaint had been known about. The ruling would appear to allow aggrieved economic operators to plead generally that a contracting authority’s scoring was wrong (as long as they bring their claim in time) but amend their statement of case at their leisure many months down the line, even when the amendment appears to bring in new complaints that would appear to be out of time in their own right. The judgment can be contrasted with the stricter approach to limitation taken in other judgments at the same level, see for example the recent case of Riverside Truck Rental Ltd v Lancashire County Council  EWHC 1018 (TCC) in which the Court struck out a claim issued after the 30 day limitation period. A strict approach was also adopted by Mr Justice Fraser in the case of SRCL v NHS England  EWHC 1985 (TCC). Together these cases demonstrate the vital importance of adhering to the deadlines contained in the PCR. However, the Orthodontics cases suggest that, as long as the claim is issued in time, claimants may benefit from a more liberal judicial approach to amendment thereafter.
The legal challenge came about following the outcome of two procurement processes run by NHSE for the provision of orthodontic referral services.
The contracts in question were for a seven year period due to commence on 1 April 2019. Both companies bringing the challenges were small orthodontic service providers and each was an incumbent provider of the services in Oxford City and Thame respectively (“the Unsuccessful Bidders”). It appears that the Unsuccessful Bidders are linked through shareholders and members. The Unsuccessful Bidders were notified by way of “standstill” letters that they had been unsuccessful (by a considerable margin) in each of the Lots for which they had bid. . The letters contained reasons for the scores awarded to the Unsuccessful Bidders and the scores obtained by the winning bidder as well as the characteristics and relative advantages of the successful bid for the Lots in question.
The Unsuccessful Bidders each brought a claim under the PCR within the 30 day period required by regulation 92 PCR. Both brought challenges on similar grounds, alleging breaches of the PCR and manifest errors in the scoring of their own bids. Although, by this stage, both Unsuccessful Bidders knew the scores that had been awarded to the winning bidder(s) for their Lots, and the characteristics and relative advantages of the winning bids, no allegations were made about the scoring of the winning bid(s). The claims were issued some months apart (in September and November 2018 respectively) but each was brought within 30 days of the standstill letter that the Claimant in question had received.
NHSE denied the substantive allegations and said that there was such a great disparity in scores between successful bidder(s) and the Unsuccessful Bidders that the Unsuccessful Bidders would be unable to demonstrate that, but for the alleged breach, they would have won the Lots in question .
Rules on Limitation
The general position under regulation 92 PCR is that proceedings must be started within 30 days beginning with the date when the economic operator first knew, or ought to have known that the grounds for starting proceedings had arisen.
When it comes to amending an existing case to introduce allegations, the position differs. Firstly, if a claimant seeks to bring a new claim under the PCR then the 30 day deadline applies and the court may use its discretion to extend time up to a maximum of 3 months. Alternatively, if a party is simply advancing further information of a breach already alleged, the court has a broader discretion to allow amendments beyond three months.
The Disputed Amendments
The majority of the Unsuccessful Bidders’ amendments for which permission was sought related to new matters arising from evaluator and moderation notes which were disclosed by NHSE in September 2019. The Unsuccessful Bidders did not apply to amend their statements of case until 2 March 2020, some 5-6 months after the grounds upon which their amendments were based, had became known to them.
In addition, for the first time, the Unsuccessful Bidders sought to challenge the scores awarded to the winning bidder(s). NHSE’s position was that this challenge was based upon the contents of the standstill letters, dating from September and October 2018, some one and a half years’ earlier. NHSE argued that the challenge to the scoring of the winning bidder(s) bid for the first time was a clear demonstration that the complaint was of a new breach.
The court found that the amendments did not amount to a new claim; in the court’s view, they amounted to an expansion of the existing pleaded case. The court defined the existing case in very broad terms as an allegation of NHSE’s general failure to evaluate the tenders transparently. Given its finding on that issue the court had discretion to permit the amendments and did so.
It is difficult to reconcile the court’s approach in this case with the stricter approach taken in other circumstances. Please follow the link here for a more detailed legal review of this judgment and comparison with cases in which the Court has taken a harsher line.