Equal Treatment And Fairness In Procurement

HHJ LLoyd QC in the case of Harmon CFEM Facades (UK) Limited v The Corporate Officer of the House of Commons [1999] EWHC TCC 199 observed that the principle of equal treatment of tenderers requires that all tenders comply with the tender conditions so as to ensure an objective comparison of the tenders submitted by the various tenderers.

This concept of equal treatment has been explored in two cases, one from Scotland and the other from Northern Ireland.

In the Harmon case, Harmon, a European-based firm, had tendered for the works at the new parliamentary building for the House of Commons. The contract was awarded to another tenderer. Harmon successfully brought an action claiming that the House of Commons had breached the UK's obligations under the Treaty of Rome not to discriminate on the ground of nationality and the principle of the equal treatment of tenderers. Harmon also successfully claimed damages for breaches of the Public Works Contracts Regulations 19911 (now superseded), on the basis that the criteria for selection (under Regulation 20 the contract was to be awarded to either the most economically advantageous or the lowest price tender) was not stated in any of the tender documents. Harmon was awarded for both the loss of profit and the wasted tender costs.

The Aquatron Case

The most recent example of a successful damages claim as a result of failings in the operation of the procurement process is the Scottish decision in Aquatron Marine, t/a Aquatron Breathing Air Systems v Strathclyde Fire Brigade.2 This case is a useful guide to the principles regarding equal treatment of tenderers.

In March 2004, the Defendants, who operate the Strathclyde Fire Brigade ("Strathclyde"), issued an invitation to tender for certain services associated with its breathing apparatus equipment, under the Public Services Contract Regulations 1993.3 As published in the Official Journal of the European Communities4, the description of the contract contained four main elements:

"Öthe Service Maintenance and Repair of Breathing Apparatus Compressors. The Service Maintenance and Repair ofÖOxygen Transfer Pumps. The Provision of Air Purity Testing to EN12021:1998. The Examination and Repair of Low Pressure Tyre Compressors."

The Office Journal specified the criteria for the award of the tender as:

"Economically most advantageous tender complying with technical specifications, i.e. price, delivery date, running costs, cost effectiveness, after sales service, compatibility, but not necessarily in that order."

The quality of the service to be provided was not included, nor was the technical merit of the tender.

Tenders were received from Aquatron and two others. Aquatron's tender was submitted on or about 30 April 2004 and specified an annual sum of £74,100, a total cost over the three year contract period of £222,300.00. The other two companies that tendered for the work were ComAir UK Ltd at...