So far this blog has been largely focussed on a contractual
analysis of the procurement process - the Contract A/Contract B
analysis and the degree to which terms can be implied into Contract
The 2011 BC case of Metercor Inc. v. Kamloops
shows a different way for a disgruntled bidder to challenge a
procurement decision that has gone against them. In this case, the
City of Kamloops issued a request for proposals for the
installation of water meters. The unsuccessful proponent (CMI)
brought an action for judicial review of the City's decision to
enter into negotiations with the successful proponent
The RFP set out a two-stage evaluation process. Proposals were
first scored for their technical merits and only those proposals
that scored at least 75% on this basis (56.25 marks) went on to be
assessed on the basis of price. Neptune was the only proponent who
scored over 75% and was therefore the only proponent whose price
was considered and became the preferred proponent by default. The
fact that proposals would be evaluated on this basis was set out in
the RFP and the court held that the City fully complied with the
RFP in this respect and had treated all bidders fairly and equally
in the evaluation. However, the court held that the decision to use
this form of two-stage evaluation process was in itself
The City's procurement policy stated that "price and
quality are major considerations." The court concluded that
imposing a cut-off below which price was not considered resulted in
eliminating price entirely from the decision-making process. They
gave an example of a proponent who scored 55 marks for quality, but
who gained 25 marks on price, as against a proponent who scored 57
marks on quality, but 10 marks on price. In the court's view,
eliminating the proponent with a total score of 80 marks in favour
of a proponent with a total score of 67 marks was unreasonable. It
was therefore unreasonable for the City to create a procurement
process that had the potential to give rise to this result. The
court remitted the matter back to the evaluation committee,
requiring them to consider the prices submitted by all proponents.
Interestingly, it is unlikely that CMI would be any better off with
this result – their technical score was 38.53, against 67.68
for Neptune and 47.18 for the third proponent. Even if CMI scored
25 points on price and Neptune zero points, Neptune would still
score higher than CMI.
This decision raises a different challenge for public sector
procuring bodies. On the Contract A/Contract B analysis, the main
challenge is to ensure that you comply with the provisions in the
RFP, treat all proponents fairly and equally and without bias.
However, with a judicial review challenge, a proponent could submit
a proposal and, if it is unsuccessful, challenge the whole basis of
the RFP. Establishing evaluation criteria is often a challenging
process – how to weigh quality against price, which aspects
of quality should have more or less weight and so on.
This case therefore underlines the need to run a
"sense-check" of the evaluation criteria before sending
out the RFP. What will happen if bids are submitted on widely
differing bases? Do the criteria have the potential to produce an
undesirable or unreasonable result? Carrying out this check in
advance would assist in rebutting any subsequent challenge from the
inevitably disgruntled losing proponents.
The next in this series of blogs will look at an alternative
method of challenging federal procurement decisions - using the
Canadian International Trade Tribunal.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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