Azam & Company, Solicitors v Legal Services Commission
| Jurisdiction | England & Wales |
| Judge | Lord Justice Pill,Lord Justice Rimer,Lord Justice Sullivan |
| Judgment Date | 10 September 2010 |
| Neutral Citation | [2010] EWCA Civ 1194 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: A3/2010/1226 |
| Date | 10 September 2010 |
[2010] EWCA Civ 1194
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
(Mr Justice Briggs)
Before: Lord Justice Pill
Lord Justice Rimer
and
Lord Justice Sullivan
Case No: A3/2010/1226
Mr Michael Bowsher QC and Mr Abdurahman Jafar (instructed by Azam and Co) appeared on behalf of the Appellants.
Mr Paul Nicholls (instructed by the Legal Services Commission) appeared on behalf of the Respondent.
Lord Justice Pill:
This is an appeal against the judgment of Briggs J given on 5 May 2010 whereby he dismissed a claim by Azam & Co, a firm of solicitors (“the appellants”) whereby they claimed a declaration that their exclusion by the Legal Services Commission (“the respondents”) from a tendering process for the carrying out of publicly funded work in relation to immigration was unlawful. The appellants also sought a mandatory order requiring the respondents to accept their tender and, in the alternative, damages for their exclusion from the tender process. An alternative claim was made during the hearing before this court. If the appellant succeeds, and succeeds only on what describe as the discretion point, the case should be remitted to the respondents for further consideration.
The respondents have now allocated most of the relevant immigration work, but the issue remains of practical importance because, if they succeed, the appellants will have the opportunity to seek work from what is known as “the residual list” of cases. They could also pursue their claim for damages.
A breach by the respondents of regulation 47 of the Public Contracts Regulations 2006 (SI 2006/5) (“2006 Regulations”) is alleged. Paragraph 47 provides, insofar as is material:
“1) The obligation on a) a contracting authority to comply with the provisions of these Regulations … and with any enforceable community obligation in respect of a public contract …
b) …
is a duty owed to an economic operator.
(6) A breach of the duty owed in accordance with paragraph ( 1) or (2) is actionable by any economic operator which, in consequence, suffers, risks or risks suffering, loss or damage and those proceedings shall be brought in the High Court.”
By virtue of Regulation 2 the appellants are an economic operator. The respondents are a contracting authority.
Regulation 4(3) provides:
“A contracting authority shall (in accordance with Article 2 of the Public Sector Directive)—
(a) treat economic operators equally and in a non-discriminatory way; and
(b) act in a transparent way.”
The respondents also accept that the decision they took must have been proportionate if it is to survive.
The judge set out the basic facts and submissions of the appellants at paragraphs 2 to 5 of his judgment:
“2. Azam & Co is a firm of which Mr Shafiul Azam is the sole principal. At the time when the 2009/10 tender process was instituted, the firm was an existing supplier of publicly funded immigration services to the LSC pursuant to a Unified (Civil) Contract which will expire on 13th October 2010, and which represents the bulk of the firm's work. Azam & Co missed the deadline for submitting a tender for immigration work, namely 12 noon on 28th January 2010, and its application on 4th February 2010 for permission to submit its tender out of time was refused by the LSC. If the firm obtains no relief in these proceedings, it will later this year cease to be able to carry out publicly funded immigration work (save possibly in a very restricted field), with financial and professional consequences both for Mr Azam himself, and for his employed staff, which include other solicitors qualified in the same field, which may fairly be described as disastrous.
3. The firm's case is, in a nutshell, in two parts. First it claims that its failure to submit a tender before the deadline was itself caused by a failure of the LSC expressly to identify that deadline by any direct communication to the firm, and that this constituted a breach of the LSC's duties of equal treatment and transparency (imposed by Regulation 4(3)), breach of its enforceable Community obligation to give effect to a legitimate expectation of the firm that it would be directly notified and, more generally, breach of the LSC's enforceable Community obligation to comply with the principles of good administration.
4. Secondly, the firm alleges that the LSC's refusal of an extension of time constituted a breach of the LSC's enforceable Community obligation to comply with the principle of proportionality, having regard to the serious commercial damage likely to be caused to the firm by a refusal, and the absence of any prejudice which would have been occasioned by the grant of an extension, in particular in the context that the firm's missing of the deadline was itself the result of the LSC's fault, rather than its own lack of reasonable care and diligence.
5. It is common ground that if the firm were to establish any of its allegations of breach of duty against the LSC (together with any necessary causal link between that breach and the firm's predicament), then the appropriate outcome would be that the firm would be given time to submit its tender late. These proceedings have been directed to be determined urgently so as to ensure that (subject to the outcome of any appeal) the result will be known in time for the LSC to make an appropriate award of publicly funded immigration work to the firm before the progress of the tender process has reached a stage where that would be impossible.
The urgency referred to by the judge continues, and the court gives judgment this morning following yesterday's hearing.
At paragraphs 9 to 28 of his judgment, the judge set out the history of the relationship between the parties. It is accepted that the narrative is accurate and it need not be set out in full. The appellants first became a supplier of publicly funded immigration services to the respondents on 1 July 2003. They were later offered General Civil Contracts to run from 1 April 2004. In 2007 the appellants obtained a Unified Civil Contract, which was effectively an automatic renewal of the earlier General Civil Contract.
In October 2008 the respondents published on their website a consultation paper entitled “Civil bid rounds for 2010 contracts”. It was sought to provide opportunities for both new and existing providers to compete for contracts. On 30 November 2009 the respondents published on their website information by way of invitations to tender for immigration and asylum contracts from 2010. A press release placed on the website at the same time identified the closing date for bids as 28 January 2010, as did the document previously mentioned. Further, an advertisement was published in the Law Society Gazette referring to the forthcoming invitation to tender and also stating that the process would close at 12 noon on 28 January 2010.
The appellant's reaction or lack of reaction to those documents was described by the judge at paragraph 25 of his judgment. He, that is Mr Azam, said that he had not noticed the July 2009 publication of the LSC's intention to extend the Unified Civil Contract for a further six months, nor did he or anyone in his firm either monitor the Law Society Gazette for publication of matters relevant to his firm's practice, still less study the advertisement pages where the LSC's advertisement of the immigration tender was placed. For those reasons, neither he nor anyone in his firm became aware of the launch of the immigration tender for 2010 prior to receipt of the 23 December 2009 letter.
By a standard form letter to all existing providers, including the appellants, dated 23 December 2009, the respondents gave information in relation to the tendering process which they had set in motion. The letter provided:
“We notified providers in July this year that we intended to extend the Unified Contract (Civil), which is due to expire on 31 March 2010, for a further six months. We have extended that period slightly, to six months and 2 weeks.
Please find enclosed formal notice of extension of your Unified Contract (Civil) under clause 2 of the Contract for Signature. This contract will now end at midnight on 13 October 2010. You do not need to take any action in relation to this extension and can carry on working as usual.
If you wish to undertake publicly funded civil work after 13 October 2010 in any category of law you must submit a tender(s), in response to our Invitations to Tender (ITT) by the applicable ITT deadline. The first ITTs, in relation to the Immigration category of law, were published on 30 November 2009 and 16 December 2009. ITTs for the remaining civil categories of law will be published from February 2010 onwards.
Full information on the tender processes and how to tender can be found on our website at www.legalservices.gov.uk following the path Community Legal Services > Tenders > Civil contracts for 2010.
We look forward to receiving your tender(s) in due course and continuing to work with you in the future.”
The judge found that on visiting the website, the reader would have seen a timetable which identified the relevant deadlines for tendering for work including immigration. In his evidence Mr Azam said that neither he nor anyone else in his firm carried out any systematic monitoring of the contents of the respondents' website and did not subscribe to the respondents' update service.
Mr Azam assumed that since the appellants' contract was being extended until October 2010...
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