Nats (Services) Ltd v Gatwick Airport Ltd Dfs Deutsche Flugsicherung GmbH (Interested Party)
| Jurisdiction | England & Wales |
| Judge | Mr Justice Ramsey |
| Judgment Date | 02 October 2014 |
| Neutral Citation | [2014] EWHC 3133 (TCC) |
| Docket Number | Case No: HT-14-281 |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Date | 02 October 2014 |
[2014] EWHC 3133 (TCC)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Ramsey
Case No: HT-14-281
and
Ms Sarah Hannaford QC and Mr Simon Taylor (instructed by Hogan Lovells International LLP) for the Claimant
Mr Michael Bowsher QC and Mr Rob Williams (instructed by Freshfields Bruckhaus Deringer LLP) for the Defendant
Mr Philip Moser QC (instructed by Simmons & Simmons LLP) for the Interested Party
Hearing dates: 10 and 12 September 2014
Introduction
These proceedings relate to a procurement carried out by the Defendant ("GAL") for the provision of air traffic control services at Gatwick Airport ("the Procurement"). GAL is the operator of Gatwick Airport and provides airport and other terminal facilities to airlines. The Claimant ("NATS") is a company, which specialises in air traffic management services.
NATS was an unsuccessful tenderer in the Procurement. It contends that the Procurement was subject to or was carried out under the Utilities Contracts Regulations 2006 as amended ("the Regulations") and therefore that, by commencing these proceedings in relation to the Procurement, GAL is prevented by the operation of the automatic suspension provision in Regulation 45G of the Regulations from entering into contracts with the successful bidder.
GAL contends that the Regulations do not apply to the Procurement but that, if they do, it seeks to lift that automatic suspension. If the Regulations do not apply then, in the alternative, NATS seeks an interim injunction to prevent GAL from entering into contracts with the successful tenderer on the basis that there have been breaches of an implied tender contract.
On the applications by NATS and GAL, I have been provided with witness statements from Ms Catherine Mason, the managing director of NATS, Mr Robert Herga, general counsel and company secretary of GAL and Mr Dirk Mahns, managing director of a wholly owned subsidiary of DFS Deutsche Flugsicherung GmbH ("DFS"), the successful tenderer.
Background
GAL published its intention to carry out the Procurement in the Official Journal of the European Union ("OJEU") on 2 October 2013. The tender was divided into two lots. Lot 1 related to air navigation services, including provision of staff for those services and Lot 2 related to maintenance and repair of equipment. The Procurement proceeded by way of Invitation to Tender ("ITT"), a negotiation phase and then the submission of best and final offers ("BAFO").
NATS submitted its BAFO for Lots 1 and 2 on 2 June 2014. By letter dated 18 July 2014 GAL notified NATS that its tender had been unsuccessful and that DFS had been successful. In the correspondence that followed NATS sought further information and GAL contended that it did not come within the Regulations.
On 18 August 2014 GAL wrote to NATS to give them 7 days' notice that GAL intended to enter into the contract with DFS. NATS therefore issued proceedings and an application for a declaration that there was an automatic suspension under Regulation 45G of the Regulations, alternatively an interim injunction. Particulars of Claim were served on 28 August 2014. On 3 September 2014 NATS issued an application for disclosure. Also on 3 September 2014 GAL issued an Application seeking to lift any automatic suspension, alternatively if the suspension remained in place, an undertaking in damages by NATS.
After a hearing relating to disclosure on 5 September 2014 the application for disclosure was adjourned until early October 2014. The other applications were then heard on 10 and 12 September 2014.
The principles to be applied to the applications
There is an issue between the parties as to the legal test to be applied if the relevant application is an application to lift the automatic suspension under the Regulations. Ms Sarah Hannaford QC, who appears with Mr. Simon Taylor on behalf of NATS, submits that the appropriate test should be a "balance of interests" test rather than the traditional test derived from the House of Lords decision in American Cyanamid Co v Ethicon Limited [1975] AC 396. Mr Michael Bowsher QC, who appears with Mr. Rob Williams, on behalf of GAL submits that the American Cyanamid test applies whether this is the case dealing with the lifting an automatic suspension or seeking an interim injunction. Mr. Philip Moser QC, who appears on behalf of DFS, made short submissions in support of GAL's position.
Ms. Hannaford submits that the essential difference between a balance of interests test and the American Cyanamid approach is that a balance of interests test does not include a separate hurdle of whether damages are an adequate remedy nor does it permit member states to require the provision of an excessive or disproportionate undertaking in damages in return for the continuance of an automatic suspension.
In this case NATS has offered an undertaking in damages to both GAL and to DFS so that the second aspect of difference does not, in fact, arise.
Ms Hannaford points out that Regulations 45G and 45H of the Regulations seek to implement into UK law the provisions of European Directive 2007/66 which amended Directive 89/665/EEC and 92/13/EEC ("the Remedies Directive"). Article 2(4) of the Remedies Directive, as amended, provides as follows:
" Member States may provide that the body responsible for review procedures may take into account the probable consequences of interim measures for all interests likely to be harmed, as well as the public interest, and may decide not to grant such measures when their negative consequences could exceed their benefits."
Ms Hannaford submits that, although the Regulations do not include the wording of the Remedies Directive, they must be construed in accordance with the wording and purpose of that Directive and she relies on the decisions of the European Court in Marleasing SA v La Comercial Internacional de Alimentacion SA [1992] 1 CMLR 305 at [8] and Von Colson v Land Nordrhein-Westfalen [1986] 2 CMLR 430 at [15] and the first instance decision of Roth J in Alstom v Eurostar [2012] EWHC 28 (Ch) at [35]
In Marleasing at [8] it was stated:
" The obligation to interpret a provision of national law in conformity with a directive arises whenever the provision in question is to any extent open to interpretation. In those circumstances the national court must, having regard to the usual methods of interpretation in its legal system, give precedence to the method which enables it to construe the national provision concerned in a manner consistent with the directive."
In Von Colson at [15] it was stated that:
" According to Article 189(3): 'A directive shall be binding, as to the result to be achieved, upon each member-State to which it is addressed, but shall leave to the national authorities the choice of form and methods'. Although that provision leaves Member States to choose the ways and means of ensuring that the directive is implemented, that freedom does not affect the obligation imposed on all Member States to which the directive is addressed, to adopt, in their national legal systems, all the measures necessary to ensure that the directive is fully effective, in accordance with the objective which it pursues."
In Alstom Roth J said at [35]:
" As mentioned above, it is common ground that an implementing regulation is to be interpreted in the light of the directive which it is intended to implement. Moreover, it is well established that such national legislation should receive a purposive rather than a literal construction in order to achieve the result pursued by the related directive. That has been repeatedly emphasised by the ECJ, notably in case C-106/89 Marleasing [1990] ECR 1–415, para 8."
Ms Hannaford submitted that the wording of the Directive indicated that the court might take into account the probable consequences of interim measures for all interests likely to be harmed as well as the public interest and might decide not to grant such measures when their negative consequences could exceed their benefit. She submitted that both the hurdle of damages being an adequate remedy based on the principles in American Cyanamid and the need for a party to give an undertaking in damages were inconsistent with a purposive interpretation of the Regulations.
Ms Hannaford pointed out that there had been no Court of Appeal decision which had dealt with the appropriate test to be applied in the case of an application to lift the automatic suspension pursuant to Regulations 45H. However she acknowledged that in his decision in Exel Europe Limited v University Hospitals Coventry and Warwickshire NHS Trust [2010] EWHC 3332 (TCC) Akenhead J had considered that question in the context of the equivalent provisions in Regulations 47G and 47H of the Public Contracts Regulations 2006, as amended. At [26] to [29] he said this:
" 26. For many years, the Courts of England and Wales have, with regard to interlocutory or interim injunctions, applied the principles and practice laid down in the well-known case of American Cyanamid Co v Ethicon [1975] AC 396. The first question which must be answered is whether there is a serious question to be tried and the second step involves considering "whether the balance of convenience lies in favour of granting or refusing interlocutory relief that is sought" (page 408B). The "governing principle" in relation to the balance of convenience is whether or not the claimant "would be adequately compensated by an award of damages for the loss he would have sustained as a result of the defendant's continuing to do what was sought...
To continue reading
Request your trial
-
Group M UK Ltd v Cabinet Office
... [2010] EWHC 2747 (Ch), Covanta Energy Ltd v Merseyside Waste Disposal Authority [2013] EWHC 2922 (TCC), and, most recently, NATS (Services) Ltd v Gatwick Ltd [2014] EWHC 3133 (TCC). In the latter case, Mr Justice Ramsey upheld the argument of Mr Bowsher QC (arguing the opposite to that w......
-
Camelot UK Lotteries Ltd v The Gambling Commission
...v Eurostar International Ltd [2010] EWHC 2747 per Vos J (as he then was) at [129]; NATS (Services) Ltd v Gatwick Airport Ltd [2014] EWHC 3133(TCC) per Ramsey J at [84]–[85]; OpenView Security Solutions Limited v The London Borough of Merton Council [2015] EWHC 2694 per Stuart-Smith J (as he......
-
Bombardier Transportation UK Ltd v London Underground Ltd
...a factor to be taken into account in determining whether it would be unjust to confine the claimants to damages for breach: NATS (Services) Ltd v Gatwick Airport [2014] EWHC 3133 per Ramsey J at [82] and 53 Thirdly, the claimants submit that the impact of the decision of the Supreme Court i......
-
Lebara Mobile Ltd and Others v Lycamobile Uk Ltd and Others
...months' time, the Block having already been in place for about 9 months. 112 I was referred to the judgment of Ramsey J. in NATS (Services) Ltd v Gatwick Airport Ltd [2014] B.L.R. 697, although in truth that case was merely one example, in the context of a public procurement dispute, of the......
-
Fox Building Engineering v Department Of Finance And Personnel
...and C-286/99 Lombardini and Mantovani [2001] ECR I-9233, [2004] 1 CMLR 27 2 NATS (Services) Limited v Gatwick Airport Limited [2014] EWHC 3133 (TCC) 3 J Varney & Sons Waste Management Ltd v Hertfordshire County Council [2010] EWHC 1404 (QB) 4 Roche Diagnostics Ltd v Mid Yokshire Hospita......
-
Table of cases
...Bush) Ltd Partnership [2010] BLR 24 III.26.06 Natoli v Walker (1994) 217 ALR 201 III.25.263 NATS (Services) Ltd v Gatwick Airport Ltd [2014] EWHC 3133 (TCC) I.4.69 NATS (Services) Ltd v Gatwick Airport Ltd [2014] EWHC 3728 (TCC) I.4.58 Nauru Phosphate Royalties Trust v Matthew Hall Mechanic......
-
Procurement
...NP Aerospace Ltd v Ministry of Defence [2014] EWHC 2741 (TCC) at [15], per Akenhead J; NATS (Services) Ltd v Gatwick Airport Ltd [2014] EWHC 3133 (TCC) at [25]–[30], per Ramsey J; Groupm UK Ltd v Cabinet Oice [2014] EWHC 3401 (TCC) at [18], per Akenhead J; Groupm UK Ltd v Cabinet Oice [2014......
-
A Comparative Review of Contract Award Controversies Around the World
...NHS Trust (2010) EWHC 3332 and NATS (Services) Ltd v. Gatwick Airport Ltd and DFS Deutsch Flugsicerung GmbH (Interested Party) (2014) EWHC 3133.(TCC). 19The Commonwealth Procurement Rules are made pursuant to section 105B(1) of the Public Governance and Accountability Act 2013 (Cth). They s......