Neology UK Ltd v The Council of the City of Newcastle Upon Tyne
| Jurisdiction | England & Wales |
| Judge | Mr Justice Kerr |
| Judgment Date | 06 November 2020 |
| Neutral Citation | [2020] EWHC 2958 (TCC) |
| Court | Queen's Bench Division (Technology and Construction Court) |
| Docket Number | Case No: HT-2020-000228 |
| Date | 06 November 2020 |
[2020] EWHC 2958 (TCC)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS
OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (QBD)
Rolls Building
Fetter Lane,
London, EC4Y 1NL
Mr Justice Kerr
Case No: HT-2020-000228
Mr Azeem Suterwalla (instructed by Hewitsons LLP) for the Claimant
Mr Joseph Barrett (instructed by DAC Beachcroft LLP) for the Defendants
Hearing dates: 21 and 22 October 2020
Approved Judgment
Introduction
This is my judgment on two applications arising out of a challenge to a procurement decision by the first defendant local authority ( Newcastle) to award a contract to provide and maintain a system for automatic number plate recognition ( ANPR) in the Tyneside area, including parts of the geographical area of the second and third defendants ( Gateshead and North Tyneside). The ANPR system consists of cameras to photograph vehicle number plates and systems to enable the local authority concerned to check the status of vehicles.
The ANPR system in Tyneside is needed to enforce a forthcoming mandatory Clean Air Zone ( CAZ) there. The CAZ is a defined area which older and more polluting vehicles may only enter if the person responsible pays a certain charge for the privilege. The ANPR system is to be used, in the usual way, to detect and enforce infringements or non-payment of charges. The registration number is photographed, read and reported electronically to local authority and central government systems used to trace the owner or keeper so they can be brought to book if the vehicle should not have been in the CAZ.
The procurement was undertaken by Newcastle. Mr Barrett represents all three defendants. Newcastle applies to lift an automatic stay on award of the contract consequent on the claimant unsuccessful bidder ( Neology) bringing its claim. Neology seeks summary judgment against all three defendants. Gateshead and North Tyneside have put in defences denying any part in the procurement. Neology contends that all three defendants are responsible for the procurement and liable to Neology for Newcastle having conducted it wrongfully.
There were three tenders. The winner was Siemens Mobility Limited ( Siemens). In second place was Systems Engineering Limited ( SEL). Neology came third. It challenges the award of the contract to Siemens. The automatic stay, unless and until lifted, prevents Newcastle from entering into the contract with Siemens to provide the ANPR systems ( the contract). SEL has taken no part in the proceedings. Siemens did not appear but provided a witness statement in support of Newcastle's position.
Neology applies for summary judgment on the ground that the defendants have no real prospect of success at trial. The defendants oppose that application and Newcastle, supported by Gateshead, North Tyneside and Siemens, applies to lift the automatic stay. Newcastle says the summary judgment application and the claim as a whole are weak and without merit; that damages would be an adequate remedy for Neology but not for the defendants; and that the balance of convenience and justice, including the public interest, favours lifting the stay.
Facts
Clean Air Zones
The CAZ concept is the government's chosen method of achieving reductions in levels of nitrogen dioxide in the outdoor air of major cities in this country, to comply with obligations under EU law ( Directive 2008/50/EU ( the Air Quality Directive)) limiting the permitted amounts of nitrogen dioxide in the air. Neology specialises in the installation, provision and maintenance of ANPR systems for uses including observation and enforcement of CAZs.
The Framework Agreement
To procure traffic enforcement cameras and associated systems needed for a CAZ, there is a certain Framework Agreement, called Crown Commercial Services Framework RM1089 Traffic Management Technology 2, Lot 2, Traffic Management and Traffic Enforcement Cameras ( the Framework Agreement). Neology has a place within the Framework Agreement, entitling it to bid for contracts for ANPR in certain cities in England and Wales where a CAZ is being or is to be established.
The Invitation to Tender
In or around February 2020, Newcastle issued an Invitation to Tender ( ITT) for a mini-competition under the Framework Agreement ( the procurement). The procurement was for the award of the contract, which was split into two parts, one for provision of the 35 cameras needed; and the other for provision of the associated software and services. The second part was for an initial period of five years, with potential annual extensions for up to a further five years.
The ITT stated that its purpose was “to appoint a Contractor to provide [ANPR] cameras and the associated local systems” for the CAZ. The procurement was therefore for both the “outstations” (the camera units on the streets) and “instations” (places where data is processed) and the related software required to operate the CAZ, to ensure it could talk to the central government computer system and Newcastle's computerised penalty charge notification system.
The ITT set out the nature of the competition and the rules by which it would be governed. Part 1 of the ITT, entitled “[i]ntroduction and organisation's guide to tender process” stated that the ITT contained, among other things, instructions for completion of the tender and details of the information a bidder should include in the tender response. It was there stated:
“You should read the ITT carefully. It is important that you understand the Council's needs and requirements as:
• you need to be able to demonstrate that you can meet those requirements in the information which you provide; …
….
You must comply with all instructions and include the signed undertaking in your submission.”
Under the heading “4. Tender evaluation and contract award”, Part 1 of the ITT stated:
“The ITT will state whether the tenders are going to be evaluated on the most economically advantageous tender or the tender which offers the lowest price.
In either case the Council will evaluate your tender using the following process:
• The Council's evaluation panel for this procurement exercise, will check the tenders to make sure tenderers have kept to the requirements.
• If compliant we will evaluate the information provided against the evaluation criteria as set out in the ITT.
• The Council will clarify your tender as needed.”
The ITT further stated that the decision to award the contract would be communicated to bidders in April 2020; that the contract would be for a period of five years with the option for up to five twelve month extensions; and that tenders were to be evaluated, following an initial pass or fail stage, on the basis of a weighting of 20 per cent for price and 80 per cent for quality.
The quality evaluation, with its overall 80 per cent weighting, was made up of the following issues, each with a sub-weighting as follows:
“Q1: Installation, Mobilisation, Operation — Overall 50% weighting
Q2: Support and Resource — Overall 25% weighting
Q3: Management and Communication — Overall 15% weighting
Q4: Social Value and Climate Change — Overall 10% Weighting.”
The scoring of the quality questions was to take place in accordance with a scoring table or matrix, with zero at the bottom of the scale, being awarded for “no response to the question or an inappropriate response in all areas”, through to 100 at the top of the scale, for “an exceptional response in all areas”.
The questions forming part of the quality assessment were included at Schedule 5b to the ITT. In Part 1 of the ITT, the following requirement was set out:
“5.1 Tender Information.
Please provide your proposals by responding to each of the questions in the Tender Response Forms (ITT Schedule 5 and 5b), giving consideration to the associated evaluation weightings and our expectations and objectives expressed throughout the specification document …. .”
The “specification document” was a lengthy contract specification set out in Schedule 1a to the ITT headed “Specification — Engineering and Construction”. The author of the document ( the specification) explained at the start that it:
“sets out the Tyneside Authorities' requirements in respect of the operation and maintenance of a network of ANPR cameras, associated infrastructure, and supporting ICT systems to deliver a functioning charging [CAZ] for Newcastle to capture non-compliant vehicles operating within the boundary of the [CAZ], and interface with external systems.”
Paragraph 5.1 of the ITT continued:
“You must not exceed the prescribed word limit for each question, should you exceed the word limit the Evaluation Panel will not take into consideration any additional words.”
Schedule 5b to the ITT repeated the scoring matrix, repeated the four aspects of the quality evaluation and then stated:
“Diagrams/photographs and examples of the documentation can be included and do not form part of the word count. However, no appendices can be included or embedded in the document to support your answer.”
Neology's Bid
The requirements for each of the four questions were then set out, as follows. The first question was “on Installation, Mobilisation, Operation”. I have added bold type to indicate the areas of controversy between the parties:
“Question 1 — Installation, Mobilisation, Operation
The Tyneside Authorities must ascertain how you intend...
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