The English High Court has ruled that a tenderer who received a ‘fail’ score should not have been excluded from the procurement process where the invitation to tender (ITT) did not clearly specify that a ‘fail’ score would lead to the exclusion of the tenderer.
The Facts
The claimant, MLS (Overseas) Limited (MLS), was the incumbent provider of global port, marine and logistical support services (Services) for the Royal Navy since 2009. A new contract for provision of the Services with a value of approximately £385 million was advertised in OJEU (Official Journal of the EU). The procurement process was conducted under the Defence and Security Public Contracts Regulations 2011.
MLS submitted a tender that was commercially compliant, offered the lowest price and was awarded the highest score in the technical evaluation. However, it obtained a ‘fail’ score in relation to question 6.3 of the ITT which asked tenderers to describe how they will ensure a safe working culture throughout the supply chain.
In its standstill letter, the Minister of Defence (Minister) stated MLS’ tender submission would have been successful had it not scored a ‘fail’ for question 6.3.
The Decision
The High Court held that the Minister had acted unlawfully and in breach of its obligations of transparency and equal treatment in excluding MLS from the procurement process. This was due to the fact that, despite the ITT setting out in bold type that failing to meet a certain level would result in exclusion of the tender, there was no clear statement that a fail score in relation to any part of question 6 would lead to the exclusion of the tender. Neither did the ITT state that a ‘pass’ score for each part of question 6 was a minimum standard.
The ITT stated that a tender would be rejected if any response achieved an assessment of lower than ‘good confidence’. However, the court did not accept that a reasonably well informed and normally diligent tenderer would have understood that a ‘fail’ score for any part of question 6 would be treated as an assessment of lower than ‘good confidence’ leading to rejection.
our Comment
The case is a stark reminder of the importance of drafting tender documents carefully. It is not sufficient for the tender document to identify a question as a pass/fail question and to assume that any tenderer who achieves a ‘fail’ score can be excluded from the procurement process. Authorities must clearly outline the minimum requirements and state that failure to meet any of these minimum requirements will lead to the exclusion of a tender.
MLS (Overseas) Ltd v Secretary of State for Defence [2017] EWHC 3389 (TCC)