Factual and Procedural Background
This case concerns an appeal by the Minister for the Cabinet Office against a decision by Judge O'Farrell allowing in part a judicial review claim challenging the direct award of a contract to Company A without public notice or competition, pursuant to Regulation 32(2)(c) of the Public Contracts Regulations 2015. The contract related to focus group and communications support services to inform government public messaging during the early stages of the Covid-19 pandemic in early 2020.
Company A was responsible for testing the government’s initial lockdown slogan and provided services described as expert and timely, with payments totaling £564,393.67 under a maximum contract value of £840,000. A not-for-profit organization, Plaintiff, commenced judicial review proceedings in July 2020, challenging the lawfulness of the direct award on grounds including the necessity of the direct award, the proportionality of the six-month contract duration, and apparent bias due to personal connections between decision-makers and Company A’s directors.
The judge found Plaintiff had standing to bring the claim, dismissed the challenge under Regulation 32 and proportionality grounds, but allowed the claim of apparent bias based on the Minister’s failure to consider other providers or keep records of objective selection criteria. The Minister appeals the finding of apparent bias, while Plaintiff cross-appeals the dismissal of the Regulation 32 and proportionality claims.
The appeal also raised a procedural issue regarding the late filing of the Appellant's Notice, but relief from sanctions was granted due to the minor delay and importance of the issues.
Legal Issues Presented
- Whether the Minister’s decision to award the contract directly to Company A without competition was lawful under Regulation 32(2)(c) of the Public Contracts Regulations 2015, specifically whether the direct award was strictly necessary due to extreme urgency.
- Whether the six-month duration of the contract was disproportionate and exceeded what was strictly necessary.
- Whether the decision to award the contract to Company A gave rise to apparent bias contrary to common law principles of public law, considering personal connections between decision-makers and Company A’s directors and the absence of a competitive process or objective selection records.
- Whether the common law concept of apparent bias applies in the context of a direct award under Regulation 32 and whether Regulation 24 concerning conflicts of interest provides a complete code in this context.
Arguments of the Parties
Appellant's Arguments
- The direct award was justified under Regulation 32(2)(c) because the Covid-19 pandemic created unforeseeable extreme urgency, making the negotiated procedure without prior publication strictly necessary.
- The six-month contract duration was reasonable and reflected the uncertainty and urgency of the pandemic response; it was not excessive or disproportionate.
- The finding of apparent bias was incorrect because the personal connections did not amount to bias, and the Minister was not required to consider other providers or keep formal records under Regulation 32.
- The concept of apparent bias at common law is not applicable or is superseded by the provisions of Regulation 24 on conflicts of interest.
Appellee's Arguments
- The direct award was not strictly necessary as there were existing suppliers capable of providing the services, the contract duration was excessive, and the scope was too wide.
- The decision to award the contract without competition and the personal relationships between Company A’s directors and decision-makers gave rise to a real possibility of apparent bias.
- The Minister’s failure to consider other providers or to keep objective selection criteria records undermined the fairness and impartiality of the procurement process.
- The common law principles of apparent bias apply and require scrutiny of the decision-making process even in the context of a direct award under Regulation 32.
Table of Precedents Cited
| Precedent |
Rule or Principle Cited For |
Application by the Court |
| R (Chandler) v. Secretary of State for Children, Schools and Families [2009] EWCA Civ 1011 |
Standing for third parties in procurement challenges |
Supported the judge's conclusion that Plaintiff had standing despite no commercial interest. |
| Salt International Ltd v. Scottish Ministers [2015] CSIH 85; [2016] SLT 82 |
Interpretation of Regulation 32 and circumstances justifying negotiated procedure without competition |
Confirmed that extreme urgency and unforeseeable events justified direct award; no competition required if strictly necessary. |
| Porter v. Magill [2001] UKHL 67; [2002] AC 357 |
Test for apparent bias based on perception of fair-minded and informed observer |
Applied the test to determine whether apparent bias existed in the procurement decision. |
| R (ex p Kirkstall Valley Campaign Ltd) v Secretary of State for the Environment [1996] 3 All ER 304 |
Application of common law bias principles beyond judicial/quasi-judicial contexts |
Referenced in discussing the applicability of common law bias principles to public procurement decisions. |
| Denton v. TH White Ltd [2014] EWCA Civ 906; [2014] 1 WLR 3926 |
Principles for granting relief from sanctions for procedural delays |
Used to grant relief for late filing of Appellant’s Notice due to minor delay and importance of issues. |
| R v. Board of Visitors of Hull Prison ex p St. Germain (No. 2) [1979] 1 WLR 1401 |
Acceptance of public authority evidence in judicial review |
Supported acceptance of unchallenged evidence from Minister’s officials on procurement decisions. |
| R (Watkins-Smith) v. Aberdare Girls High School [2008] EWHC 1865 (Admin) |
Judicial review standards for evidence and fact-finding |
Reinforced approach to evidence acceptance in judicial review context. |
Court's Reasoning and Analysis
The court began by confirming the applicability of Regulation 32(2)(c), which permits a negotiated procedure without prior publication in situations of extreme urgency unforeseeable by and not attributable to the contracting authority. The Covid-19 pandemic was found to constitute such an event, justifying the direct award to Company A.
On whether the award was "strictly necessary," the court rejected arguments that existing suppliers could have fulfilled the contract, that the six-month duration was disproportionate, or that the contract scope was excessive. The court emphasized the emergency context, the need for rapid and reliable services, and the practical realities of procurement timelines during a crisis.
The court noted that the negotiated procedure under Regulation 32 dispenses with the requirement for a competitive tender and related procedures, including comparative assessments of suppliers, thereby negating the need for a formal competitive process or documented objective selection criteria in this context.
Regarding apparent bias, the court acknowledged the personal and professional connections between Company A’s directors and decision-makers but found that these alone did not establish bias. The court identified tension in the lower court’s requirement for a formal record of objective criteria and consideration of other providers, which conflicted with the accepted application of Regulation 32 in emergencies.
The court accepted unchallenged evidence from government officials that Company A was uniquely positioned to provide urgent services, trusted, and already engaged, making alternative providers impractical. The fair-minded and informed observer, fully aware of the emergency context and the reasons for the direct award, would not perceive a real possibility of bias due to the absence of a comparative procurement process or formal documentation.
The court also discussed the limits of the common law bias principles in the context of private law contract awards by public bodies, noting the lack of adjudicative or quasi-judicial function in such decisions and expressing doubt about the applicability of apparent bias in this setting, though it assumed it arguendo for the appeal.
Holding and Implications
The court ALLOWED the Minister’s appeal and DISMISSED the Plaintiff’s cross-appeal.
The direct award of the contract to Company A under Regulation 32(2)(c) was lawful, strictly necessary, and proportionate in the context of the Covid-19 emergency. The finding of apparent bias was overturned, with the court concluding that the absence of a formal competitive process or documented objective criteria did not create a real possibility of bias given the emergency and regulatory framework.
The decision confirms that in situations of extreme urgency, contracting authorities may lawfully award contracts without competition and that common law apparent bias principles have limited application in such procurement decisions. No new precedent was established beyond the application of existing principles to the unique facts of the pandemic emergency.