FACTS

The case concerns the NHS's procurement of a seven-year contract for the provision of orthodontic services, where Braceurself (the incumbent) lost the procurement by a very narrow margin. In a trial of liability, the Court confirmed that the NHS made a manifest error in scoring, without which Braceurself should have been awarded the contract (Braceurself Ltd v NHS England [2022] EWHC 1532 (TCC)). See our commentary on this decision here.

At a later hearing on damages (Braceurself Ltd v NHS England [2022] EWHC 2348 (TCC)), the High Court found that the error made by the NHS was not sufficiently serious to justify an award of damages, despite depriving Braceurself of the contract. See our commentary on this decision here.
The question of whether that decision on damages was correct was appealed.

DECISION

On 30 January 2024 the Court of Appeal upheld the High Court's decision that an (apparent) manifest error in the scoring of a single question was not "sufficiently serious" to warrant damages being awarded, despite it resulting in the claimant not being awarded the contract.

COMMENTARY

This is a significant decision as it is the first time that the "sufficiently serious" test has been applied at Court of Appeal level. The Court of Appeal described the case as "unique" due to the low culpability of the contracting authority and the "extreme consequences" of the (apparent) single marking error.

On the face of it, this decision appears to be surprising and unfair to Braceurself. Had the NHS scored the question correctly (according to the first instance judge), then Braceurself should have been awarded the contract.

However, the test when determining whether a breach is "sufficiently serious" concerns the nature of the breach itself, and not the consequences it levies. A single breach in an otherwise well-run procurement is apparently unlikely to tip the scale in favour of a tenderer who would have won the contract, but/for the breach. The importance of the procurement being well-run was re-emphasised and the overarching legal principles, of openness and fairness of process, were the main focus.

The Court of Appeal suggests that an award to the wrong bidder as a result of an error of the contracting authority would be a "relevant consideration", but not the deciding factor.

Braceurself argued that it had been denied an effective remedy, because:

• in lifting the automatic suspension, the first instance judge held that damages were an adequate remedy;
• it was later held that there was a manifest error that led to the contract not being awarded to Braceurself; and
• it was then held that the error was not of sufficient seriousness to warrant an award of damages.

The Court of Appeal dismissed this argument swiftly, as they considered it to be a short-circuit to the question of whether the breach was sufficiently serious. It was held that this fundamentally misunderstood the principle of "effectiveness" of a remedy (ie. there being a proper remedial process, and not being a guarantee of entitlement to damages).

Interestingly, the Court of Appeal said that the original decision of the High Court was wrong in its finding that there was a material error at all, and that the score the evaluators had awarded to Braceurself (in relation to the stair-climber/stairlift) was reasonable. It seems that the Court of Appeal considered Braceurself should not have won the contract and so this may have some weight behind what, on the face of it, seems a curious outcome.