Procurement limitation periods will be enforced STRICTLY 

In December 2021, the Technology and Construction Court (TCC) handed down its decision for Access For Living v London Borough of Lewisham (2021). The TCC used this opportunity to confirm that limitation periods in procurement cases will be enforced strictly.  The Court warned that parties must fully understand what time limits they have agreed to extend.  

Public procurement is governed by the Public Contracts Regulations 2015 (PCR).  The PCR provides rules for the procurement of goods, services, and works above a certain threshold by public authorities.  The PCR provides clear rules about limitation periods for public procurement, these rules were at issue in the present case.  

What does the Public Contracts Regulations 2015 say about limitation periods? 

• Regulation 86(1): a contracting authority shall send to each candidate and tenderer a notice communicating its decision to award the contract or conclude the framework agreement.  

• Regulation 87: Where regulation 86(1) applies, the contracting authority must not enter into the contract or conclude the framework agreement before the end of the standstill period. 
• Regulation 92(2): proceedings must be started within 30 days beginning with the date when the economic operator first knew or ought to have known that grounds for starting the proceedings had arisen.  
• Regulation 92(4): The Court may extend the time limits imposed by regulation 92 where the Court considers that there is good reason for doing so.  

Access For Living v London Borough of Lewisham (2021): the facts 

On 21 October 2019, the Council commenced a mini-competition for the award of a 4-year contract for the provision of 12 adult learning supported services.  AFL was the existing provider for 5 of these services.  The contracts were due to end on dates in March and April 2020.  The mini competition was conducted through a portal and the Invitation to Tender was published through the portal on 21 October 2019.  AFL tendered for the 5 lots where it was the existing provider.  However, on the 07 February 2020 AFL was notified that was unsuccessful in all bids.  

A ten-day automatic standstill period applied after the decision notice – this was in accordance with regulation 86 PCR.  This prevented the Council from entering new contracts during this time.  The Council agreed to extend this standstill period until 13 March 2020.  AFL issued proceedings within the extended standstill period.  However, the issue date was 32 days after the date of the decision notice, therefore, it was outside the 30-day limitation period to bring a claim as mandated by regulation 92 PCR. 

The decision  

The TCC recognised that the “30-day limit is a short one, but the courts have repeatedly emphasised that it should be observed”.  The short limitation period exists for a reason and “to extend time because of ignorance of the law would not reflect that reason.” The TCC referred to Dyson LJ’s opinion in Jobsin v Department of Health (2001) on this matter: 

“That is no doubt for the good policy reason that it is in the public interest that challenges to the tender process of a public service contract should be made promptly so as to cause as little disruption and delay as possible. It is not merely because the interests of all those who have participated in the tender process have to be taken into account. It is also because there is a wider public interest in ensuring that tenders which public authorities have invited for a public project should be processed as quickly as possible. A balance has to be struck between two competing interests: the need to allow challenges to be made to an unlawful tender process, and the need to ensure that any such challenges are made expeditiously.” 

Further to highlighting this position, the Court recognised that it had discretion to extend the 30-day limitation period if it considered that there was a good reason for doing so.  In this case, the explanation for the delay in issuing proceedings was an error made by AFL, namely a misunderstanding on the effect of the standstill agreement and AFL accepted that this error was not a good reason to extend the limitation period.  Therefore, there was clearly no good reason to extend the 30-day period.  

Quigg Golden commentary  

This case provides a clear message from the TCC: limitation periods under the Public Contracts Regulations will be interpreted strictly.  

The fact that the 30-day limitation period for issuing proceedings is short is not a valid argument in itself to extend this time limit.  The 30-day limitation period exists to mitigate as much delay and disruption as possible in public service contracts.  Contracting parties must ensure they are aware of the law and regulations governing public contracts, ignorance of the law will not exempt parties from the consequences of failing to adhere to these regulations.  

Parties must fully understand the time limits imposed on them.  Parties should ensure that they pay careful attention to any agreed extensions in both standstill periods and limitation periods.  If you are concerned about the outcome of a tender, you should seek legal advice immediately after the decision notice due to the short standstill and limitation periods under the PCR.  You cannot seek a remedy if you act outside of these limitation periods.  

If any of the above issues concern you or your company, please do not hesitate to get in touch.  Quigg Golden are public procurement experts, and our legal experience allows us to deliver added value through our ability to draft bespoke or amend standard contract forms and advise on both procurement and contractual matters.