Turning Point Scotland sought reduction of a decision to award certain lots in a public contract to the Salvation Army under the Public Contracts (Scotland) Regulations 2015, instead of to it. Each party claimed that the other party’s position was irrelevant in law with the matter coming before the court to determine whether either argument of irrelevance was made out.

The case was heard by Lord Sandison in the Outer House of the Court of Session. Lindsay KC appeared for the pursuer and MacGregor KC for the defender.

Economically advantageous tender

By way of an Invitation to Tender dated 10 October 2024, the council invited tender bids for a public contract underpinning its WAYfinder Service, a programme aimed at helping people who are at risk of homelessness or who are homeless. The contract was split into lots including several different locality support services, a central hub and a list of approved suppliers for further services that might be required. Lot 5 was tied to Lots 2 to 4, with the result that it could not be bid for as a standalone lot and could be allocated to multiple providers. A provider could only be awarded one of Lots 1 to 4.

The pursuer tendered bids for Lots 3 and 4, both tied to Lot 5, with it being the only bidder for lot 3. Lot 4 was listed as its first preference. However, the council awarded Lot 4 to the Salvation Army, the second highest-scoring bidder for the lot, and Lot 3 to Turning Point, on the basis that not awarding Lot 3 to Turning Point would result in an unfilled lot.

For the pursuer it was submitted that the decision of the defender complained of was an unlawful exercise of its discretion. It proceeded on the unlawful basis that Section 1.2 of the ITT conferred upon it an absolute discretion to award each lot as it considered to be most conducive to ensuring that every lot was filled and that no economic operator was appointed to more than one lot. However, in the circumstances the pursuer had the most economically advantageous tender in respect of both lots, thus requiring the council to award it both lots in accordance with Regulation 19(1) of the 2015 Regulations.

On behalf of the defender, it was submitted that the ITT was clear that a bidder could not be awarded more than one lot within Lots 1 to 4. It was similarly clear that the council would not take account of a bidder’s lot preference where that would result in a lot being unfilled. The procurement process fell under the ambit of Schedule 3 to the Regulations, and any challenge to the terms of the ITT themselves was time-barred. The pursuer could not harbour its alleged concerns and wait for the procurement process to conclude in the hope of a more favourable outcome.

Sufficiently important objective

In his decision, Lord Sandison said of the tendering process: “No attempt was made to argue that the way in which the procedure was operated was not sufficiently transparent. The council did what it did and explained the reasons for its actions clearly and promptly. Turning Point’s complaint is not that any relevant lack of clarity attends what was done, but rather that what was done was in breach of other obligations owed to an economic operator in the context of a procurement governed by the Section 7 regime.”

He continued: “It was clear from the terms of the tender documentation that the council wished to secure providers for all lots, and that that was regarded as a sufficiently important objective to justify it, if it saw fit, in departing from certain aspects of the award process as originally anticipated. If the positions of Turning Point and the Salvation Army at the stage of the contract awards had been reversed, and the latter had been the only compliant bidder for one lot, then there is no reason on the available material to suppose other than that it would have been awarded the contract for that lot regardless of whether or not that was its preference. In other words, it would have been treated exactly as Turning Point was treated.”

Assessing the objectives of the process, Lord Sandison said: “The council had explained that the structure of the procurement exercise which it was then embarking upon was aimed at reducing barriers to entry to the market and to ensure that there was sufficient market capacity and security. So long as dealt with proportionately, those are all considerations amply capable of properly influencing both decisions as to the structure of a procurement exercise and, if need be, as to the manner of its operation within the broad limits prescribed in the context of the particularly delicate types of health, social and related services listed in Schedule 3 to the Regulations.”

He concluded: “The suggestion, against that background, that a failure to award a contract for a particular lot to the most economically advantageous tenderer for that lot amounts to even a prima facie case of unequal treatment or breach of the other substantive obligations owed to an economic operator in a case like the present, is baseless.”

The pleas of the defender on relevance were therefore sustained, and the action dismissed.