Procurement Litigation Commenced Over West Coast Main Line Contract

It is reported that Virgin has begun court proceedings over the award of the West Coast Main Line franchise to First Group.  By issuing the claim before the contract has been signed off and within the standstill period after the announcement of the result, Virgin can activate the so-called automatic injunction process provided for since 2009 in the Regulations which govern the award of public contracts. That process could make the government go to court for permission to make the award to First Group without waiting for the outcome of the claim.

Procurement litigation is complex and it remains to be seen which of the possible remedies Virgin will seek and how far it will get.  For now, contractors awaiting appointment by First Group as part of the infrastructure works that were part of its bid should expect delays on their contracts. Virgin had reportedly offered to continue to run the line at no profit until the award process was sorted out – it is not clear whether that offer will stay on the table after the government this morning categorically refused to delay the award process for any voluntary review.

With times increasingly tight in the economy procurement challenges are increasingly common as disappointed bidders try to get compensation of their lost opportunities or force a re-run of a process in which they did not succeed.  The West Coast Main Line is just a very big ticket example of a pattern being repeated all over the country when a valuable public contract is awarded which will have a big impact on the losing bidders, especially current providers that lose out.

Contracting authorities and bidders alike need specialist advice on the processes of procurement and how they can be challenged. Fitting together the sub-contracts that might be necessary to implement a bid is equally important in order to avoid hiring contractors with nothing to do or making contractual commitments with no means to carry them out.

If you require advice or assistance in this developing field of law contact Daniel Milnes or Robin Stephens at Forbes.

 

Daniel Milnes

About Daniel Milnes

Dan is a Partner and Head of Contracts & Projects. Dan’s blogs cover the areas in which his specialities lie in commercial, regulatory and governance law which cover a broad range of matters dealing with contracts, projects, corporate and group structures, funding and compliance with a range of legal regimes including data protection. This also involves writing and advising on various forms of commercial contracts including joint ventures, development and construction agreements and intellectual property contracts including IT agreements, sponsorships and other rights licensing arrangements.

This entry was posted in Corporate & Restructuring, Dispute Resolution and tagged , , , , .

Leave a Reply

Your email address will not be published. Required fields are marked *