Herbert Smith Freehills succeeds for client in procurement dispute

By admin Dec3,2023

Herbert Smith Freehills has successfully represented its client High Speed Two (HS2) Limited in a high profile procurement dispute brought by Siemens Mobility Limited concerning two contracts for the manufacture and maintenance of rolling stock with an estimated value of £2 billion.

The contracts were awarded to a joint venture between Bombardier Transportation and Hitachi Rail in November 2021, following a lengthy procurement run between April 2017 and October 2021. Siemens was ranked in second place and brought proceedings challenging the decision to award the contracts to the Bombardier/Hitachi joint venture. The claim comprised seventeen sets of proceedings and challenged the procurement processes in a number of ways. Issues considered included HS2’s evaluation of the tenders, its conflict of interest processes, verification processes undertaken pre-contract award, and post-contract award consideration of potential modifications of the train design.

Mrs Justice O’Farrell DBE comprehensively dismissed all seventeen claims and made a number of comments on the running of procurement competitions, and what is required to bring a successful procurement challenge. This included reinforcing the Court’s supervisory jurisdiction in procurement cases; that it is not the role of the Court to carry out its own assessment of what decision the public authority should have made and replace the public authority’s decision accordingly. Siemens’ allegations were on a number of occasions considered by the Court to be based on its subjective assessment of what should have happened, and each of these were rejected on the basis that subjective disagreement is not sufficient to establish a manifest error by the authority.

The Judge also held that Siemens was not entitled to invoke public law duties where a remedy was available to it under the Utilities Contracts Regulations 2016. This case concerned a commercial competition without a public law element, and judicial review is a remedy of last resort.

The Herbert Smith Freehills team comprised Partner Nusrat Zar, Senior Associates James Robson, Chloe Woodward, Lara Nassif and Olivia Walton, and Associates Abigail West, Hussein Mithani, Steven Chua and Phoebe Fox.

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