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Procurement in a Nutshell – Unsuccessful incumbent fails to achieve summary judgment following procurement challenge

In August the High Court published its interim judgment in the case of DHL Supply Chain Ltd v Secretary of State for Health and Social Care within which it considered an application to lift the automatic suspension imposed by the Public Contracts Regulations 2015, as well as an application for a summary judgment.

Click here to view the judgment.

The Court’s analysis is particularly useful in clarifying how it deals with such applications.  As such, this week’s Nutshell will focus on the Court’s considerations when arriving at its decision relating to the application for summary judgment.

The facts

The dispute revolved around a procurement conducted by the Secretary of State for Health and Social Care for a contract for logistics services for the NHS and social care services.

The purpose of the procurement was to help form a Future Operating Model under which better value for money would be achieved in the NHS supply chain meaning that the savings could be used for various beneficial means.

Following its unsuccessful bid, the incumbent provider, DHL Supply Chain Ltd (the “Claimant”), challenged the award on the basis that the Secretary of State had conducted the procurement exercise in an “unlawful manner” contrary to the Public Contracts Regulations 2015.

In particular, the Claimant suggested that the Secretary of State had failed to apply the correct scoring criteria when assessing the winning bidder’s response to one of the selection questions and that in doing so:

“…the Defendant breached its duties, failed to apply the published selection criteria, applied undisclosed selection criteria, breached its duties of equal treatment and transparency, misdirected itself and/or committed manifest errors.”

Consequently, the Claimant issued an application for summary judgment – asking that the Court dispose with the matter without the need for trial.

Application for Summary Judgment

Rule 24.2 of the Civil Procedure Rules states that:

“The court may give summary judgment against a… defendant on the whole of the claim or on a particular issue if it considers that:

  • The defendant has no real prospect of successfully defending the claim or issue; and
  • There is no other compelling reason why the case or issue should be disposed of at trial.”

With regard to the principles applicable to the Court when making such a decision, the Court noted that a summary judgment cannot be granted in cases where the defendant has a realistic and not a “fanciful” prospect of success if the matter were to proceed to trial.  In the same manner, the Court emphasised that when granting summary judgments it:

“…must not conduct a mini trial and should avoid being drawn into an attempt to resolve conflicts of fact which are normally resolved by the trial process.”

In line with this, the Court recognised that “more complex” cases are unlikely to be capable of being resolved on a summary basis without disclosure and oral evidence at trial.

In this instance, the Court was of the opinion that with regard to the issue of whether the Contracting Authority had correctly applied the scoring criteria:

“On the documents currently before the Court, the [Secretary of State] has a real prospect of successfully defending the claim.”

Consequently, and for this reason, the Court was of the opinion that the issue of whether the selection criteria had been applied properly could only be determined fairly by allowing the parties the opportunity to give evidence at trial.  As such, the application was unsuccessful.

Why is this important?

Summary judgments offer the possibility of significantly reducing costs in cases where it is clear that a party has a strong chance of success.  Accordingly, despite its finding that the Claimant was not entitled to a summary judgment in this instance, the Court’s judgment is a very useful reminder of the considerations it will take into account when deciding whether or not to deal with an issue without trial.

If you have any queries on the issues raised or on any aspect of procurement, please contact us via our procurement hotline on 0191 204 4464.

Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.

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