DHL Supply Chain Ltd v Secretary of State for Health and Social Care and Unipart Group Ltd

Citation: [2018] EWHC 2213 (TCC)

This was an application for summary judgment and an application to lift the automatic stay imposed by the Public Contracts Regulations 2015.

The case concerned a procurement exercise for the provision of logistic services for the NHS and social care services with a value of £730 million. Since 2006, DHL has provided NHS supply chain services under the Master Services Agreement (MSA). DHL’s contract is due to expire on 28 February 2019. The MSA is to be replaced by the Future Operating Model (FOM) which is a reorganisation of the NHS supply chain. DHL challenged the decision to award the logistics contract under the FOM to Unipart.

DHL alleged that the authority had acted unlawfully in relation to SQ 6.9 which required the bidders to demonstrate “experience of managing a service in the Health and Social Care Environment of similar size, complexity and scope”. Unipart had been awarded a score of 3 and DHL argued that there was no lawful basis upon which such a score could have been awarded. DHL argued that on a proper interpretation of the ITT, Unipart should have failed SQ 6.9 and been excluded from the rest of the process.

O’Farrell J refused to order summary judgment. The judge held that on the documents before the court, the defendant had a real prospect of successfully defending the claim. SQ 6.9 would have to be interpreted according the factual matrix known to the parties and the court could not speculate as to what such an exercise would show. In particular, there were factual disputes as to what was said to tenderers at the pre-bid meetings, what would be required to show the relevant experience, whether there were other bidders that could meet the criteria, and whether Unipart’s response satisfied the criteria.

O’Farrell J further held that the suspension on awarding the contract should be lifted. The judge held that the disruption caused to patients could not adequately be compensated for by the cross-undertaking in damages. The balance of convenience also favoured keeping the stay in place. The public interest would be served by having the cost saving measures implemented and it would not realistically be possible to hold a trial without causing a delay.

Sarah Hannaford QC represented the defendant and Fionnuala McCredie QC represented the interested party.

JUDGMENT

Counsel

Sarah Hannaford QC
Fionnuala McCredie QC

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