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Legal challenges put evaluators in the hot seat: Public buyers should stick to decision criteria
Paul Emanuelli
The March 2007 BC Supreme Court decision in Roback v. University of British Columbia illustrates how the courts will apply different levels of scrutiny to disputes arising out of evaluation decisions by public buyers. It also shows how contract award decisions attract a relatively high level of attention.
The case involved a job competition run by the University of British
Columbia for an assistant professor position. The plaintiff submitted a c.v. but the job went to another applicant with allegedly fewer qualifications. The plaintiff claimed the University owed job applicants the same duties owed by purchasers to bidders during a formal tendering process.
The Court disagreed, finding a job competition is not like a formal tendering process. It also found applying similar duties would lead to an increase in litigation and put the courts under the regulatory function of “scrutinizing the minutiae of pre-contractual conduct.”
While the Court wasn’t prepared to place this level of scrutiny on job competitions, a high level of legal inspection remains a fact of life for evaluators during a formal tendering process.
As the following recent cases illustrate, purchasers are increasingly
finding themselves in the hot seat and under the microscope, defending their evaluation decisions in the face of supplier-
launched lawsuits.
Tender compliance
In its March 2007 decision in Cityscape Contracting v. Edmonton (City), the Alberta Court of Queens Bench considered the rejection of a tender. The City issued a tender call for the construction of an indoor soccer facility which specified that the supplier of the prefabricated building would have to be CSSBI/CSA-A660 certified.
The Court upheld the City’s decision to reject the tender because the
proposed supplier of the prefabricated building did not have the required certification. As this case illustrates, contract awards can turn on the evaluation of tender compliance.
Evaluation challenge
In the case of Canadian North Inc. v. Department of Indian Affairs and Northern Development, the Canadian International Trade Tribunal considered allegations of an improper evaluation is the award of a $150-million contract for food air transport services.
The complainant alleged the evaluation team used a guide that was inconsistent with the criteria in the RFP. The Tribunal, in February 2007, agreed and awarded lost profit damages. While this determination was later overturned by the Federal Court of Appeal for
unrelated jurisdictional reasons, its ruling on the improper use of evaluation guides remains instructive.
Weight of past experience
In its December 2006 determination in Antian Professional Services Inc. v. Canada (Minister of Public Works and Government Services), the Canadian International Trade Tribunal determined the government unfairly applied past experience criteria in an RFP for exhibit management services.
The Tribunal found the government failed to properly disclose its preference for the breadth of past experience, as opposed to the depth of past experience.
It also found the complainant—who had submitted references to reflect its depth of experience—was prejudiced by the hidden criteria and awarded lost profit damages. As this case illustrates,
purchasers should be transparent with their evaluation criteria in order to make their decisions more defensible.
Subcontractor rights
In January 2007 the Supreme Court of Canada granted leave in Design Services Ltd. v. Canada to consider whether subcontractors can sue purchasers over alleged improprieties in the tendering process.
The case involves a federal government tender call for the construction of a naval reserve building in St. John’s, Nfld. A prime bidder and its subcontractors brought an action challenging
an improper evaluation and contract award to a non-compliant competing bidder. The prime bidder reached a settlement with the government and the subcontractors continued their lawsuit.
While prime contractors who submit bids typically have the right to sue purchasers over tendering improprieties, the Supreme Court will now decide whether subcontractors have the same right.
If they succeed, this could significantly expand the pool of potential plaintiffs who can sue purchasers.
With the steady flow of legal challenges being launched from coast-to-coast, purchasers are left wondering whether their next evaluation decision will end up as the next reported case in this everexpanding body of case law. b2b
Paul Emanuelli is a Canadian procurement lawyer and author of a textbook entitled Government Procurement. He can be reached at paul.emanuelli@sympatico.ca
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