Background
The Irish Supreme Court has now delivered a final decision in
long-running and multi-faceted litigation brought by Word Perfect
Translation Services Limited (“Word Perfect”) against the
Minister for Public Expenditure and Reform (“the
Minister”) in relation to the award of a contract for
interpretation services1. Word Perfect sought review of
the award on a number of grounds, including manifest error, failure
to provide reasons for the decision and grounds related to concerns
about the integrity and transparency of the public procurement
process. The grounds were narrowed to two issues before the Supreme
Court; these related to the test by which a tender award under
procurement legislation may be properly reviewed by a court for
“manifest error”. In a judgment delivered by O’
Donnell J, the Supreme Court found that there was a manifest error
in respect of one aspect of the evaluation process and consequently
set aside the award decision.
Facts of the Case
The proceedings concerned a mini-tender under a multi-provider
framework for the provision of interpretation services. Word
Perfect came a close second in the competition, achieving 870 out
of 1,000 available marks, 15 marks behind the successful tenderer,
Translation.ie. The award decision was challenged by Word Perfect
and the ensuing litigation gave rise to a number of important
judgments in the High Court and Court of Appeal concerning the
adequacy of damages as a remedy in procurement cases2
and discovery3. The substantive proceedings concerned
allegations that the contracting authority had committed manifest
errors in its evaluation process and failed to provide reasons for
its award decision. The High Court initially rejected all arguments
submitted by Word Perfect4. Word Perfect appealed on
four grounds, two of which concerned the evaluation of a quality
assurance plan and a service delivery plan5.
Quality Assurance Plan
The tender documentation stated that there was a requirement for
an effectively and efficiently managed interpretation service for
which management information reporting was critical. Tenderers were
required to explain in their tenders how they would provide
management information reports and were provided with notional
information to produce a number of sample bespoke reports. Each
report was required to include a narrative summarising the
information provided and a separate narrative explaining how
tenderers would ensure that reports would be provided in a timely
manner.
Word Perfect scored the full 200 marks for its response to this
criterion. The successful tenderer, Translation.ie, scored 170
marks despite the evaluation report noting that it had
“failed to develop the narrative component of the
report“. 170 marks equated to 85% of the available marks.
According to the published scoring methodology (which established a
top band of 80%-100%), this meant that the successful tenderer had
provided an “excellent response that fully meets or
exceeds requirements and provides comprehensive and convincing
assurance that the tenderer would deliver to an excellent
standard“. Word Perfect argued that in absence of any
text containing a narrative summary of the information in a report,
the successful tenderer’s response could not have fully met the
tender requirements and a manifest error in evaluation had
occurred.
The High Court had concluded that the successful tenderer did
provide a “narrative” as it provided introductory text
and information in graphic form with certain tabular summaries.
However, the Court of Appeal reversed this decision and held that
the word “narrative” would be understood by a reasonably
diligent and well-informed tenderer as a written
statement6. The Court of Appeal held that a visual
display or a depiction of the information by way of charts and
graphs, or similar was insufficient and that a narrative summary
had not been provided. A manifest scoring error had occurred as the
mark awarded to the successful tenderer implied that it had fully
met or exceeded requirements.
Service Delivery Plan
A second aspect of the evaluation exercise concerned the
proposed service delivery plans of tenderers and the requirement to
demonstrate methods that would ‘ensure’ interpreters retain
their skills and fluency. The successful tenderer received full
marks for its response to this. The evaluators’ report stated
that “in relation to retention of language skills,
‘Translation.ie encourages ongoing training by providing and
recommending the participation in workshops, seminars, formal
course work as well and informal learning opportunities in order to
remain up to date with current developments in the field’.
However, a formal policy in respect of this training would have
given a higher level of assurance“.
Word Perfect challenged the decision to award Translation.ie
full marks for its response. It failed initially to convince the
High Court that the response of the successful tenderer did not
include any proposal to ensure skills retention. However, the Court
of Appeal overturned the High Court’s decision on this issue
noting that in its response, the successful tenderer merely stated
that it would ‘encourage’ skills retention among
interpreters, but that there was nothing in the plan that
demonstrated how it would actually ‘ensure’ this. The Court
of Appeal found that the response did not fully comply with the
tender requirements and did not justify the successful tenderer
obtaining a perfect score against this criterion. It found that the
High Court was wrong not to find a manifest error on the part of
evaluators in this regard.
The law: manifest error and the RWIND test
In considering the Minister’s appeal in relation to both of
the above issues, the Supreme Court recounted the applicable law in
relation to manifest error. The Court affirmed the standard of
review established in the leading case of SIAC Construction Ltd
v Mayo County Council7. In that case the Court
applied the Court of Justice decision in the same case8
and held that tender documents must be interpreted by reference to
how reasonably well-informed and normally diligent tenderers would
interpret them (the well-known ‘RWIND’ test) while allowing
“a wide margin of discretion” to the awarding
authority.
The Supreme Court also drew attention to the principle of
transparency set out by the Court of Justice in Commission v
Netherlands9 and adopted by the Irish Courts in
Gaswise Ltd v Dublin City
Council10:
“The principle of transparency implies that all the
conditions and detailed rules of the award of procedures must be
drawn up in a clear, precise and unequivocal manner in the notice
of the contract document so that, first, all reasonably informed
tenderers exercising ordinary care, can understand their exact
significance and interpret them in the same way, and, secondly, the
contracting authority is able to ascertain whether the tenders
submitted satisfy the criteria applying to the relevant
contract”
The Supreme Court also confirmed that tender documents must be
interpreted from the perspective of industry professionals involved
in tendering and not from that of lawyers.
There was no significant disagreement between the parties on the
applicable principles of law. However, as the Court pointed out,
this does not mean that there cannot still be considerable dispute
about the application of those principles to the facts.
O’Donnell J added:
“For my part, I would be inclined to see that standard
of manifest error not so much in terms of the patent nature of any
error, but rather as relating to the degree of confidence with
which it can be said that the decision was wrong. An error may not
be apparent on the surface of the decision, and may be difficult to
identify and explain, but if, once understood, it is clear that it
is indeed an error, then the test is satisfied.”
Service Delivery Plan
The Supreme Court allowed the Minister’s appeal on this
ground, holding that the decision to award Translation.ie full
marks for its Service Delivery Plan was not a manifest error. The
maintenance of skills was only one component of the Service
Delivery Plan and the review of both tenders in their entirety was
necessary to determine if a manifest error had occurred. It was
unlikely that the tender documentation required tenderers to
provide some form of “absolute and humanly impossible
guarantee” that the maintenance of skills would be
ensured and so if a tender fell short of such a guarantee it must
also necessarily fall short of full marks. That would be to take
“too lawyerly an approach” to the interpretation
of the tender documents to the exclusion of the industry
context.
Quality Assurance Plan
The Minister argued that the Court of Appeal’s
interpretation of the word ‘narrative’ was too verbal and
text-bound and that the graphical charts presented could still
satisfy the requirement of a narrative. However, the Supreme Court
found the Court of Appeal’s conclusion that compelling that a
narrative summary in text was required. This was the natural
meaning of the words, particularly when taken in their context.
Thus, the Court held that the award of marks in the top band to
Translation.ie was a manifest error because only submissions which
fully met or exceeded the requirements could legitimately fall
within that band. This had to result in the setting aside of the
award decision (even though it was possible that Translation.ie
could still have won the competition had it been awarded a mark
within the scoring band below, albeit by a wafer-thin margin).
Comment
While the decision of the Supreme Court does not establish new
legal principles to be applied in cases of manifest error, it is
nonetheless of interest. It demonstrates the level of precision
that contracting authorities must apply, both when drafting tender
documents and evaluating responses thereto. The fact that different
courts have adopted varying interpretations of the same tender
requirements also illustrates that evaluation is an inexact science
and susceptible to error no matter how thorough and detailed it
is.
Another interesting aspect of the case was the analysis given to
the scoring methodology used by the contracting authority, which
applied the top band of marks (80% to 100%) to those responses
which fully met or exceeded requirements. O’Donnell J described
the marking scheme as a “straight jacket” which could
lead inevitably to the conclusion that a response which is
excellent in nearly every respect and fully meets or exceeds the
requirements in all but one area cannot achieve more than 79% of
the marks. This may be so even though that response is superior
overall to a competing response which does meet all of the
requirements. Scoring methodologies play a critical role in the
evaluation process. Contracting authorities preparing tender
documents are well advised to give full consideration to how
scoring systems will be applied to tender responses in
practice.
Footnotes
1 Word Perfect Translation Services Limited v. the
Minister for Public Expenditure and Reform [2019] IESC
38.
2 [2018] IEHC 1 and [2018] IECA 35.
3 [2018] IEHC 158 and [2018] IECA 87.
4 [2018] IEHC 237.
5 In relation to two other grounds of appeal raised by
Word Perfect, the High Court’s decisions were upheld. The Court
of Appeal found that evaluators were not required to explain why
the provisional marks awarded to tenderers evolved over the course
of a number of evaluation meetings – to do so would add a new
layer of complexity. It also held that Word Perfect was not
entitled to the additional reasoning it sought in respect of
questions where it had achieved higher scores than the successful
tenderer.
6 [2018] IECA 156.
7 [2002] 4 IR 148.
8 C-19/00 SIAC Construction Ltd v. Mayo County
Council [2001] ECR 1-7725.
9 Case C-368/10 [2012] 3 CMLE 11.
10 [2014] IEHC 56.
11 This case note was first published in the Public
Procurement Law Review, Issue 4/2020, by Thomson
Reuters
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