Ireland: Northern Ireland High Court Maintains Automatic Suspension For The First Time

For the first time since the entry into force of the new remedies rules on 20 December 2009, the UK courts are reported as having decided to leave in place an automatic suspension preventing a contracting authority from entering into a contract.

This was an unusual case, as two bidders for a contract for training services had issued proceedings against the Northern Ireland Department for Employment and Learning, and in each case the Department had applied to lift the automatic suspension. In the first case, which was unreported, the Court agreed to maintain the automatic suspension. However, the Department also applied to lift the automatic suspension in the second set of proceedings, brought by First4Skills. The Court held that it was an abuse of process for the Department to pursue this application after the first suspension was maintained. It therefore concluded that it would not lift the automatic suspension. Nevertheless, the Court also went on to consider the issues in the First4Skills proceedings.

Once more, the Court considered the application through the prism of the American Cyanamid principles. The Court concluded that there were serious issues to be tried, namely that there was a dispute between the parties about conversations between their representatives, issues concerning the authority's explanation for and construction of statements in the tender which lacked cogency and that there was potential for further disclosure. The Court held that damages would not be an adequate remedy.

Where the Court departed from courts considering similar applications in the past was in its treatment of the balance of convenience. In this case, it gave no weight to the authority's arguments concerning the benefits of new contract arrangements and the lack of legal certainty. Instead, it was persuaded by the fact that maintaining the automatic suspension would not result in any gap in the provision of services. For the first time, the automatic suspension therefore remains in place.

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