Braceurself v NHS England: Manifest scoring error not "sufficiently serious" for procurement damages

Why is Braceurself v NHS England of interest?

In order for damages to be awarded in a successful procurement challenge the breach of procurement law must be “sufficiently serious”. Based on previous cases [2], this requirement was thought to be met where the breach led to the contract being awarded to the wrong contractor.

The Braceurself decision casts doubt on this. It highlights that whether a breach is sufficiently serious or not is a matter of fact and circumstance which requires analysis of all eight factors referenced in the well-known Factortame [3] decision as they apply to the specific facts of the case. It suggests that a relatively minor mistake in the context of an otherwise well run procurement exercise should not justify the award of damages where the public has not been adversely affected, even if a contractor has lost out on a very valuable contract.

The case is of interest to all contracting authorities and contractors operating in the public sector, particularly when they are considering (i) the merits of a challenge to a well organised procurement exercise and (ii) how to approach an application to lift an automatic suspension of the award of the contract.

What were the facts?

Braceurself concerned the award of a contract for orthodontic services in East Hampshire. Two of three evaluators had assessed the claimant’s response to a question regarding accessibility as a 4 and the third had scored it 3. During moderation, the evaluators agreed to score it 3 on the basis of what the court found in a previous hearing [4] was a manifest error as to the nature of the claimant’s response. The evaluators had wrongly understood that the claimant intended to install a stair lift when in fact the response referred to a stair climber. The court found that if it had not been for this misunderstanding the claimant would have been awarded a 4, which would have increased its score by 2.5% and meant that it was the most economically advantageous tenderer, albeit by a margin of only 0.25%. On that basis, it should have been awarded the contract.

The court’s reasoning

The court referred to the following facts when deciding that there had not been a sufficiently serious breach of procurement law to justify the award of damages:

• Although the claimant had raised various complaints regarding the defendant’s scoring, the court only upheld one single breach;

• It was a very close competition and unfortunately that single breach had a powerful impact on the outcome;

• The breach was at the excusable end of the spectrum and was minor;

• It was inadvertent, rather than deliberate, and was made in good faith;

• The purpose of the scoring of the relevant question was to maximise access to public services and was therefore a laudable one;

• The procurement was carefully planned and well organised, to the credit of the defendant;

• While the financial impact on the claimant was significant, it was not existential as the claimant had remained in business;

• There was no material impact on the wider public, which it was clear from the very close scores would be almost equally well served by either bidder; and

• The case was far removed from the multiple breach case in Energy Solutions.

The court also rejected the suggestion that this left the claimant without a remedy despite the automatic suspension of the award of the contract being lifted on the basis that damages would be adequate. This was because the Public Contracts Regulations 2015 provide for the award of damages in the same circumstances regardless of whether the contract has been awarded or not. However, this seems to ignore the fundamental point that damages will not be adequate if they will not be awarded because, despite there being a breach of procurement law, it is not sufficiently serious.

What practical advice arises from Braceurself v NHS England?

As always, contracting authorities should make sure they have clear and robust policies and procedures in place for scoring and moderation. They should include a way of making sure that all of the evaluators properly understand a response in the same way and that, where there is any uncertainty, clarifications are raised or the position is checked.

In Braceurself, in deciding that there had been a manifest error, the court seemed to be swayed by the fact that the evaluators could easily have discovered the differences between a stair lift and a stair climber. However, the fact that the procurement had generally been very well run was a decisive factor in the decision not to award damages. Making sure a rigorous process is followed may therefore help to protect an authority from claims even where mistakes are made which have a material impact on the outcome.

It will be interesting to see what, if any, impact this has on applications to lift the automatic suspension of the award of a contract. Contractors would be well advised to rely on this decision as a reason why the suspension should not be lifted. On the other hand, authorities will need to think carefully about whether to accept that there is a sufficiently serious breach in order to succeed in an argument that damages would be an adequate remedy.

Need advice or assistance?

Our procurement specialists, Kathryn Vickers and Lynsey Oakdene, can help contracting authorities and contractors with any aspect of a procurement exercise, from checking the robustness of a process to assessing the merits of a challenge.

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[1] Braceurself Limited v NHS England [2022] EWHC 2348 (TCC)

[2] Energy Solutions EU Limited v Nuclear Decommissioning Authority [2017] UKSC 34 and Alstom Transport UK Limited v Network Rail Infrastructure Limited [2019] EWHC 3585 (TCC)

[3] R v Secretary of State ex p. Factortame Limited [2001] 1 AC 524

[4] Braceurself Limited v NHS England [2022] EWHC 1532 (TCC)