Key takeaways from R (Cornwall Council) v Secretary of State for Housing, Communities and Local Government [2026] EWHC 1805 (Admin)

In particular the case serves as an important reminder of the need to carefully assess and document decisions early in the granting of funding to ensure compliance with obligations.

The facts

Cornwall Council brought a judicial review claim against a decision by the Secretary of State to clawback a total of £2,121,431.66 awarded to the Council under the European Regional Development Fundings (“ERDF”) framework.

The clawback decision had been made on 14 May 2025 and related to two separate projects:

a) £2,110,882.18 awarded to Costain Jacobs Partnership (“CJP“) for constructions of a walking, cycling and horse riding bridge over the A30 of Chiverton Cross in Cornwall

b) £10,549.48 awarded to MWJV Limited for a competitive project management services contract

The principle issue in relation to the CJP monies was that this had been directly awarded to CJP without advertising the opportunity or conducting a competitive procurement exercise.

This decision was justified by the Council on the basis of commercial and practical realities of the project, rather than careful observation of its legal obligations under applicable procurement law. CJP was already engaged in delivering the A30 Chiverton widening project and according to the Council, the bridge works required a high degree of integration and co-operation with those existing works.

Also faced with a looming funding and project deadlines, the Council argued that CJP was effectively the only realistic contractor capable of delivering the bridge project successfully, relying on an argument of “genuine technical reasons” as to why only CJP could perform the works as justification for there being no public advertisement.

In the words of the Council, “A single contractor delivering both the A30 and the Chiverton Bridge would provide the best assurance that this can be achieved to ensure the safety of construction operations during the works period while safely maintaining traffic flows on the strategically important A30 Trunk road. […] If a separate bridge contractor was involved then an extremely high level of coordination between both parties would be required…”

The judicial review grounds

The Council originally advanced seven grounds of challenge to the Secretary of State’s decision, six of which were granted permission to proceed. These were that the Secretary of State:

1. Made a material error in law in determining that the CJP procurement was above the threshold within Directive 2014/24/EU.
2. Failed to provide adequate reasons for concluding that Cornwall Council had not established that CJP was the only supplier capable of carrying out the works for “genuine technical reasons”.
3. Failed to provide adequate reasons for rejecting the Council’s reliance on the funding deadline as a justification for the direct award of the bridge contract to CJP.
4. Failed to take account of relevant considerations as to whether the direct award could be justified on the basis of exclusive rights.
5. Erred in law, by concluding that the contract awarded to MWJV Limited breached principles of equal treatment and non-discrimination due to the requirement relating to subcontracting opportunities for Cornish SMEs.
6. Acted unlawfully in concluding that the construction of Chiverton bridge had a cross-border interest, thereby requiring compliance with EU Treaty Principles.

The council subsequently sought to raise an eighth ground on 1 June 2026, shortly before the hearing. The proposed amendment argued that EU law no longer applied at the time the direct award was granted to CJP. This argument had not previously featured in the Council’s earlier pleadings and was inconsistent with its previous positions; permission was therefore not granted for the council to amend their legal argument.

Ultimately, the Court refused permission to amend to add an eighth ground, noting  that Article 138 of the Withdrawal Agreement preserved the application of relevant EU law to ERDF programmes until their formal closure date. As the relevant programme remained open until 31 December 2023, the procurement remained subject to the applicable EU regulatory framework.

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Take Me There

The outcome

The High Court dismissed Cornwall Council’s claim on all its permitted grounds.

In doing so, the Court reinforced the narrow scope of the exemptions permitting direct contract awards without competition. A key theme running throughout the judgment was the distinction between circumstances that are merely commercially advantageous or convenient and those that satisfy the legal test for exclusivity.

The Court accepted that appointing CJP may have been the most convenient and efficient solution from a project management perspective. However, convenience, efficiency and familiarity with an existing contractor do not establish that only one supplier is capable of performing the works, and are therefore not “genuine technical reasons” as to why a contract should not have been subject to a competitive procurement process.

Similarly, the Court held that funding deadlines and project delivery pressures do not amount to an automatic justification for choosing a particular contractor and is not a “technical reason”.

Localism vs. non-discrimination

The judgment also addressed the continuing tension between local economic ambitions and procurement law principles.

The second grant of ERDF funds which were clawed back, the £10,549.48 awarded to MWJV Limited, concerned measures intended to benefit local Cornish small and medium-sized enterprises (“SMEs”). While supporting local businesses is often a legitimate policy objective, the Court reaffirmed that procurement processes must remain consistent with the principles of equal treatment and non-discrimination.

The invitation to tender for this project had required that at least two of the sub-consultants used to provide the services must be a Cornish SME. This was seen to disadvantage non-UK tenderers because they would be inherently less likely to have the required local networks in order to be able to negotiate with Cornish subconsultants.

Contracting authorities cannot structure procurement requirements in a way that unjustifiably favours local suppliers over potential competitors from elsewhere. The decision therefore serves as a reminder that authorities seeking to promote local economic growth must do so within the framework of procurement law.

Brexit and residual EU obligations

A further significant aspect of the judgment concerns the continued application of the EU funding rules following Brexit.

The Court confirmed that EU legal obligations can continue to apply long after the UK’s departure from the European Union where they are preserved by transitional arrangements, funding agreements or the Withdrawal Agreement itself.

For bodies managing legacy EU-funded projects, the case highlights the importance of understanding not only current procurement legislation but also any continuing obligations attached to historic funding programmes. It is false to assume that Brexit automatically disapplies EU procurement requirements and the clawback of £2,121,431.66 from Cornwall Council serves as a clear warning of the consequences of relying on this false assumption.

Practical lessons for local authorities

The judgment presents us with a number of valuable lessons:

• Direct awards remain exceptional. Authorities must be able to demonstrate genuine legal grounds for bypassing competition, rather than relying on practical convenience or project preferences.
• Technical exclusivity is interpreted narrowly. The fact that a contractor is best placed, most familiar with a project or operationally advantageous will not normally satisfy the high bar argument that no alternative supplier could undertake the works.
• Funding deadlines are not a procurement exemption. Pressure to spend funding within programme timescales does not excuse non-compliance with procurement requirements.
• Local economic objectives must be balanced against equal treatment obligations. Supporting local suppliers cannot justify discriminatory procurement practices.
• Legacy EU funding programmes may still attract EU law obligations. Authorities should carefully review the specific legal framework governing funded projects rather than assuming current domestic procurement rules apply exclusively.
• Robust record keeping is essential. Where an authority relies on an exemption, it should ensure that the evidence supporting that decision is documented clearly and contemporaneously.

Conclusion

The judgment makes it clear that commercial convenience, funding deadlines and competing local policy objectives cannot displace fundamental procurement principles.

The importance of carefully assessing and documenting any reliance on procurement exemptions at the outset of a project has been reinforced. Where public funding is involved, particularly legacy EU funding streams, authorities should also be mindful that historic regulatory obligations may continue to apply long after the original funding decision has been made.

Here at Ward Hadaway we have experienced legal advisors in public procurement, grant funding arrangements and judicial review who can provide support. Please do not hesitate to get in contact if you are a public body requiring assistance.