Attorney General of Trinidad and Tobago v Trinsalvage Enterprises Ltd

Lord Burrows ( with whomLord Kitchin, Lord HamblenandLady Roseagree):

The central question in this case is whether a claim in the law of unjust enrichment for the reasonable value of services rendered and materials supplied (ie a quantum meruit) is defeated because to allow the claim would stultify (ie would undermine or contradict) the policy of the Central Tenders Board Act (Trinidad and Tobago). It is not in dispute that, subject to that Act, the claim in unjust enrichment would here succeed. It is also not in dispute that, in principle, a claim in unjust enrichment will be defeated where to allow it would stultify the policy (or, one might say, purpose) of a relevant statute. But what is in dispute is whether there is such a stultification of statutory policy in this case.

This is not a case on illegality. The Central Tenders Board Act (which for shorthand will sometimes be referred to as “the Act”) lays down that, for contracts over a certain value, only the Central Tenders Board (the “CTB”) has the authority or power to make contracts on behalf of the Government of Trinidad and Tobago. But it is not made a criminal offence to enter into such a purported contract without going through the CTB. We are therefore dealing with unjust enrichment in respect of a contract that is void for want of authority or void because ultra vires and not one that, by reason of illegality, is unenforceable or void.

At some time prior to August 2000, the Government through the Minister of Works and Transport (“the Minister”) wanted work to be carried out, and materials to be supplied, in relation to what was referred to as the “San Fernando Harbour Development Project – Phase 1”. After a tendering process, the offer made by Trinsalvage Enterprises Ltd (“Trinsalvage”), which is the claimant (and the respondent in this appeal), was accepted on behalf of the Minister. In August 2000, a written contract was purportedly entered into by Trinsalvage and the Permanent Secretary of the Ministry of Works and Transport (“the Ministry”), on behalf of the Minister and hence on behalf of the Government (and the State). The work agreed to be carried out by Trinsalvage involved coastal reclamation and the construction of a dock. The price agreed for the work and materials (which was the price in Trinsalvage's tender) was $6,740,894. (The currency referred to throughout this judgment is the Trinidad and Tobago dollar.)

The work was carried out by Trinsalvage. Various stages were certified as completed on 30 October 2000, 17 January 2001, 6 March 2001, 21 March 2001, and 17 October 2001. Extra work was carried out, and a large amount of extra materials were supplied, up until December 2004. Although the Board has not been provided with the precise figures, it would appear that the Ministry paid (at least) the original sum agreed under the (purported) contract. However, it refused to pay for (at least most of) the extra work and materials.

Under the agreement, the specified amount of landfill to be supplied by Trinsalvage was 46,000 cubic metres. Clause 51.2 of the agreement permitted Trinsalvage to make a variation to the quantities of landfill specified, and the consequent extra work required, without prior instruction from the engineer. It is an agreed fact that the extra amount of landfill supplied was 93,672 cubic metres. The extra sums claimed by Trinsalvage, in relation to which there were certificates of completion, and which have not been paid by the Ministry, amounted to $4,997,021.47 plus VAT.

Trinsalvage commenced a claim for that sum on 13 December 2004 with the statement of claim being filed on 24 November 2006 and amended on 20 July 2010. The defendant (and the appellant on this appeal) is the Attorney General of Trinidad and Tobago who is being sued as the representative of the Minister, and hence of the State, pursuant to section 19(2) of the State Liability and Proceedings Act. The defendant disputed that the Minister had any liability to pay the sum claimed and averred that the Permanent Secretary in the Ministry had no authority to enter into the alleged contract.

The parties agreed by a consent order dated 21 January 2013 to split the issues of liability and quantum. Under that consent order:

“in relation to the issue of quantum the parties have agreed to appoint a joint independent expert to determine or ascertain the value of the works in ascertaining the quantum if necessary and that parties agree to be bound by the valuation of the joint independent expert.”

The Act was first enacted in 1961 and has undergone numerous amendments since then (and, as referred to at the end of this judgment, it was very recently repealed and replaced by a new Act but with non-retrospective effect). As can be seen in the extracts below, which were applicable at the relevant time for the purposes of this case, the Act sets up the CTB and explains its role and composition in sections 4 and 5. It explains the required process of inviting tenders in section 20, the requirement for certificates to show that the person tendering is up to date with payments of tax in section 23A, the need for the CTB to accept the best offer and what that means in section 24, and the requirement for a formal contract in section 26. Section 35 empowers the President of the Republic of Trinidad and Tobago to make certain regulations.

“ 4. Establishment of Board

• (1) There is hereby established a Central Tenders Board which save as is provided in section 20A and in section 35 of this Act shall have the sole and exclusive authority in accordance with this Act—

  • (a) to act for, in the name and on behalf of the Government and the statutory bodies to which this Act applies, in inviting, considering and accepting or rejecting offers for the supply of articles or for the undertaking of works or any services in connection therewith, necessary for carrying out the functions of the Government or any of the statutory bodies;

  • (b) to dispose of surplus or unserviceable articles belonging to the Government or any of the statutory bodies.

• (2) The Board shall have such other functions and duties as the President may by order prescribe from time to time.

5. Composition of Board

• (1) The Board shall be composed of eight members consisting of—

  • (a) at least five public officers appointed by the President, and

  • (b) such other members at large to be appointed by the President as may be necessary to fill up the membership of the Board.

• (2) The President shall appoint two of the ex officio members of the Board, other than the Treasury Solicitor, to hold the offices of Director of Contracts and Deputy Director of Contracts respectively.

• (3) The Director of Contracts shall be the Chairman and the Deputy Director of Contracts shall be the Deputy Chairman of the Board.

…

20. Request for invitation of offers to be in writing

• (1) …, whenever articles or works or any services in connection therewith are required to be supplied to or undertaken on behalf of the Government or a statutory body to which this Act applies, the Government or such statutory body shall make written request to the Board to invite on its behalf offers for the supply of those articles or for the undertaking of the works or services in connection therewith.

• (2) The request referred to in subsection (1) shall contain a sufficient description of the articles, works or services to be supplied or undertaken.

• (3) On the receipt of any such request, the Board shall either—

  • (a) invite members of the public in general to make offers for the supply of such articles or for the undertaking of such works or services, as the case may be, by Notice published in the Gazette and in local or overseas newspapers, or

  • (b) subject to the approval of the Minister, invite such bodies or persons as may be selected by the Board to make offers for the supply of such articles or for the undertaking of such works or services, as the case may be, whenever the Board considers it expedient or desirable so to do.

…

20A. Government may act on its own behalf

• (1) Notwithstanding the provisions of section 20(1), the Government may act on its own behalf where—

  • (a) as a result of an agreement for technical or other cooperation between it and the Government of a foreign State, the latter designates a company to supply the articles or to undertake the works or any services in connection therewith;

  • (b) the articles or works or any services in connection therewith are to be supplied or undertaken by a company which is wholly owned or controlled by a foreign State;

  • (c) it enters into a contract with the National Insurance Property Development Company Limited or a company which is wholly owned by the State, for the supply of articles or for the undertaking of works or services in connection therewith;

  • (d) it enters into a contract with a company for the purchase of books for official purposes;

  • (e) as a result of the occurrence or anticipation of flooding, hurricane, landslide, earthquake or other natural disasters, the Minister is of the opinion that an emergency situation has arisen in any part of Trinidad and Tobago, the abatement, prevention or alleviation of which...