PETITION BY KENMAN HOLDINGS LIMITED AGAINST COMHAIRLE NAN EILEAN SIAR
EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
[2017] CSIH 10
P552/15
Lady Paton
Lord Menzies
Lord McGhie
OPINION OF THE COURT
delivered by LORD MENZIES
in the Petition
by
KENMAN HOLDINGS LIMITED
Petitioner and Reclaimer
against
COMHAIRLE NAN EILEAN SIAR
Respondent
Petitioner and Reclaimer: Dunlop QC, P Sellar; Maclay Murray & Spens LLP
Respondent: Crawford QC, E Campbell; Harper MacLeod LLP
3 February 2017
Introduction
[1] The petitioner is a company which owns and operates hotels on the Isle of Lewis. The respondent is Comhairle Nan Eilean Siar (“the Council”), which owns Lews Castle, a redundant Category A listed building in Stornoway that the Council wishes to develop as a heritage and hospitality tourist destination. The council envisages that the works will be carried out in four phases. These proceedings are concerned with the third and fourth phases, being upper floor works and hospitality and accommodation fit‑out, to be undertaken by a private sector partner who would subsequently be granted a concession by the Council to operate various tourism‑related businesses within the premises. A public procurement exercise conducted by the Council in 2012 led to the signing, on 24 July 2014, of a development agreement between the Council and two companies who are interested parties in these proceedings.
[2] In this application for Judicial Review the petitioner originally sought various orders including (i) declarator that the Council’s decisions to enter into the development agreement and a related technical services agreement with these companies were taken in breach of EU public procurement law and legal principles, and in breach of natural justice; (ii) reduction of those decisions; and (iii) damages. Answers were lodged on behalf of the Council, Highlands and Islands Enterprise (“HIE”), and these companies, denying that any breach of EU law and principles or of natural justice had occurred. The Council contended inter alia that the application for Judicial Review was incompetent, and, in any event, that it should be refused on the grounds of mora, taciturnity and acquiescence on the part of the petitioner.
[3] These two preliminary issues were considered by the Lord Ordinary at a first hearing diet, following which by interlocutor dated 16 December 2015 he sustained the Council’s second plea in law and refused the prayer of the Petition. The Council’s second plea in law was that “the petitioner being barred by mora, taciturnity and acquiescence the prayers of the Petition should be refused.”
[4] It is against that interlocutor that the petitioner now reclaims. The Lord Ordinary found in favour of the petitioner on the question of competency. The respondent has not reclaimed against his determination on this point. The sole issue before this court is therefore the question of mora, taciturnity and acquiescence.
[5] In the course of proceedings in the Inner House, the petitioners and reclaimers were allowed to amend their pleadings by restricting the remedies which they seek. They now seek the following remedies:
(a) declarator that the decisions to award the contract and the related contract to the Company were in breach of requirements of European Union law relating to public procurement and natural justice;
(b) declarator that the award of the related contract constitutes unlawful state aid in breach of Articles 107 and 108(3) of the Treaty on the Functioning of the European Union;
(c) expenses against any party appearing to oppose the Petition;
(d) damages estimated to be £23,340,538;
(e) such further order, decree or orders as may seem to the court to be just and reasonable in all the circumstances of the case.
Perhaps for this reason, the companies and HIE who appeared as interested parties before the Lord Ordinary were not represented at the summar roll hearing before this court. In addition to detailed Notes of Argument, we heard submissions on behalf of the petitioner and reclaimer and the respondent. We do not propose to set out in detail the terms of the respective notes of argument, which we have taken into account. Before summarising the submissions for the parties, it may be helpful to set out the exchanges and correspondence between the parties, which featured in the discussion before us.
Chronological Sequence of Events
[6] 1/4/14 Mr Kenneth McKenzie, chief executive of the petitioner, wrote to Councillor Angus Campbell, leader of the Council, referring to a meeting of 6 March regarding the Lews Castle development, and offering to present his ideas to progress the project. He indicated that he was confident that the Board would find his proposal would deliver a higher level of economic benefit than what was currently proposed, as well as being much less controversial.
8/4/14 Mr Campbell responded to the above, indicating that both procurement exercises conducted by it complied with all legal requirements. The second of the procurement exercises which had identified Natural Assets (one of the interested parties) as the preferred bidder had not yet been concluded but negotiations were at an advanced stage. In the event that the Council was satisfied as to certain factors, he would anticipate an appointment being made, and he was advised that to stop the current process without good reason might give rise to a legal challenge from Natural Assets. He indicated that it would not be appropriate to discuss Mr McKenzie’s proposal for Lews Castle at a time of advanced contractual negotiation.
17/4/14 Mr McKenzie prepared a written aide memoire for a meeting with Mr Campbell, noting his concerns and proposals.
5/5/14 Mr McKenzie sent an email to Mr Malcolm Burr at the Council seeking information about contact between the Council and Natural Retreats/Natural Assets prior to 5 November 2012.
29/5/14 The FOI team of the Council emailed Mr McKenzie giving a response to the above, which indicated three meetings in July and August 2012.
10/6/14 The petitioner’s solicitors (“MMS”) emailed the respondent making formal FOI requests for detailed information about meetings between the Council and the above companies and any other parties before the tender process, the evaluation of tender submissions from the above companies, and meetings held on or around 20 July 2012.
18/6/14 MMS sent a letter by email to Mr Campbell of the respondent, which asserted breaches of the procurement rules. The letter contained the following passages:
“there is at the very least an appearance that Natural Assets has received an unfair advantage with respect to the Tender following the meetings and the call. In so far as the meetings and the call are an example of pre‑tender engagement, they have not taken place in a transparent, objective and non‑discriminatory way. Rather, the process appears to have been largely opaque and has fallen far short of basic EU law requirements. …
The Council appears to be in breach of its duty under the Regulations which requires it to consider all tender submissions in accordance with principles of equal treatment and transparency and its obligation to follow proper and transparent procedures. That is a duty owed to our client …
In light of the above issues, our client would request that the current tender process be withdrawn and substituted by a new, compliant process. Our client would be happy to meet with the Council to discuss his concerns in more detail.”
26/6/14 Mr Campbell of the respondent replied to the letter from MMS of 18/6/14. This letter rejected the claims made in the letter of 18/6/14; it included the statement “I am confident that the Comhairle has met its legal obligations in relation to this procurement process”, and concluded with the words “I do not accept that the procurement process is defective”.
30/6/14 MMS made further formal FOI requests of the Council, which focused on the areas of alleged breaches of the Procurement Rules set out in the email of 18/6/14.
20/8/14 A notice was published in the EU journal that the contract had been awarded to Natural Assets.
11/9/14 MMS wrote by email to Mr Campbell of the respondent, (and to the Scottish Government and Audit Scotland) complaining that the pre‑tender communications with Natural Assets resulted in their receiving an unfair advantage to the detriment of other potential bidders. The letter contained the following assertions:
“Due to the fact that the Comhairle engaged in both pre‑ and post‑tender discussions with Natural Assets, and disregarded the principles of equal treatment and transparency, it was not entitled to award the contract to Natural Assets. In that context, we note that our Freedom of Information request from 30 June 2014 addressed to the Comhairle to gather information in that respect was responded to well after the statutory date by which a response should have been given. A response to our Freedom of Information request was due on 31 July 2014. We received the response on Tuesday 7 August 2014 at 4.51pm. The formal decision to award the contract was taken on Wednesday 8 August 2014. The failure to comply with the Freedom of Information legislation and the coincidence between the timing of the response eventually received and the formal decision to award the contract will be brought to the attention of the European Commission. The problems with the procurement process described above also mean that Natural Assets has received a selective advantage through state resources which distorts competition.”
15/9/14 Mr Campbell of the respondent replied to the letter from MMS dated 11/9/14. He did not accept that the award of the contract breached procurement, EU funding and/or state aid rules. He went on to state:
“Your client has had time to challenge the procurement process and has not done so. I do not consider there was anything in the information provided pursuant to the Freedom of Information request which would have changed your client’s position. In any event the Comhairle was fully entitled to award the contract at any point following the conclusion of the standstill period and chose to do so as soon as the aforementioned legal drafts had been agreed.”
26/9/14 MMS wrote by email to the respondent’s solicitor expressing dissatisfaction with the way the Council had dealt with the FOI request and seeking a review of its decision.
24/10/14 The respondent replied to MMS’s request for review dated 26/9/14 making further (but not complete) disclosure.
3/11/14 - 7/11/14 MMS sent six emails requesting additional information from the respondent in respect of the same areas of interest already discussed in correspondence.
17/11/14 The solicitor to the respondent emailed MMS responding to these various requests and suggesting a meeting.
1/12/14 MMS responded to the solicitor to the respondent indicating that they did not consider a meeting as being necessary for the time being. This letter contained not only references to the public interest in transparency and proper and effective administration, but also the statement that “the matter which is the subject of our Requests is very important to our client and involves substantial public funds.”
23/12/14 The respondent wrote to MMS stating that it would not be able to comply in full with the requests by the due date of 31/12/14 owing to the absence of various members of staff on leave.
24/12/14 A solicitor for the respondent sent a large number of documents to MMS as part of their Freedom of Information requests, with the statement that “I had hoped to send them by email today but the attachments were too large to fit into the email.”
18/2/15 MMS wrote to the chief executive of the respondent indicating that the petitioner did not consider that it had received all of the information it required.
23/3/15 The chief executive of the respondent wrote to MMS enclosing a large number of documents. (We were told that 12,500 pages were sent under cover of this letter). The letter contained the following statements:
“It is also my understanding that due to the complicated nature of the Lews Castle redevelopment project, it would not be the case, as you state in your letter, that ‘a wide range of employees’ could simply collate the information requested …
A vast amount of information has been disclosed to your client. Much of the information disclosed is of a highly sensitive and confidential nature which includes communications with third parties. The Comhairle maintains its position that the Lews Castle redevelopment project has been conducted throughout with complete transparency, integrity and professionalism.”
14/5/15 MMS wrote to the chief executive of the respondent indicating that the petitioner had instructed them to raise an action in the Court of Session for Judicial Review seeking reduction of the award decision and damages.
28/5/15 The petition for Judicial Review was lodged in court.
2/6/15 An interlocutor appointing intimation and service was pronounced.
The Lord Ordinary’s Opinion
[7] After referring to recent authorities on the application of the plea of mora, taciturnity and acquiescence and distilling six (non‑exhaustive) propositions from these, the Lord Ordinary gave his reasons for sustaining the respondent’s plea of mora, taciturnity and acquiescence at paragraphs [22] ‑ [27] of his Opinion. (It must be borne in mind when considering these reasons that when the matter was before the Lord Ordinary the petitioner was still seeking reduction of the decisions.) He observed that the petitioner’s principal complaints, namely that there were pre‑tender discussions and post‑tender negotiations between the Council and the Company, were clearly stated, under reference to a supporting factual background, in MMS’s letter dated 18 June 2014. He considered that the period that fell to be scrutinised for mora, taciturnity and acquiescence began then. He accepted that the matter was complex and had no difficult in accepting that the petitioner did not yet consider that it was in possession of the information it required in order to frame a sufficiently specific ground of legal challenge. Although it could have proceeded by way of an application under section 1 of the Administration of Justice (Scotland) Act 1972, the Lord Ordinary made no criticism of the decision to proceed by way of FOI requests. However, by 11 September 2014 the contract had been awarded and the petitioner felt able to make quite specific assertions that the Council had disregarded the principles of equal treatment and transparency and was not entitled to award the contract to Natural Assets. The Lord Ordinary regarded it as relevant that at that time the petitioner gave no indication that it was minded to raise court proceedings to have the award of the contract set aside. He observed that there was no assertion by the petitioner that legal proceedings were contemplated until the letter dated 20 April 2015 was sent to HIE, just over a year after the date when, in his view, the mora clock began to run, and no intimation of any intention to raise proceedings for Judicial Review was made until May 2015. He did not consider that the petitioner’s further FOI requests were sufficient to rebut an inference of acquiescence arising from delay and taciturnity. “Taciturnity” must be understood in context; the FOI letters sent on the petitioner’s behalf consisted mainly of lengthy complaints about the manner in which the Council and HIE had dealt with previous requests for information, and assertions of the public interest, but they did not make any reference to the contemplation of court proceedings by the petitioner to have the award set aside. The Lord Ordinary considered that the nature of the petitioner’s “speaking out” was not inconsistent with an inference of acquiescence, however reluctant and dissatisfied, in the award of the contract to the Company. By allowing a period of a year to elapse from the time when it became aware of grounds of challenge of an award of contract to the Company, and eight months to elapse from the time when it received information in response to its first FOI request and also became aware that the contract had been awarded, before intimating any intention to mount a court challenge to the award, the petitioner delayed for an unreasonably long time and, moreover, delayed silently for the purposes of the operation of the plea. He observed that:
“in a public law matter where it is detrimental to good administration to allow a matter as important as the development with which these proceedings are concerned to remain in a state of uncertainty, I consider that reluctant acquiescence may reasonably be inferred from the petitioner’s delay and taciturnity.”
[8] Understandably, much of the Lord Ordinary’s reasoning above was concerned with the issues which were then before him, which included a claim for reduction of the decision to award the contract. However, he went on to consider the argument with regard to the claim for damages as follows:
“[27] I reject also the petitioner’s ‘fall-back’ argument that even if the present action falls foul of mora, taciturnity and acquiescence with regard to the conclusion for reduction, it should nevertheless be allowed to proceed with regard to its other conclusions including the conclusion for damages. I am not persuaded that by excising the conclusion for reduction, the action loses its character of a public law challenge and acquires instead an entitlement to benefit from a more relaxed attitude to mora and taciturnity appropriate to a private law action. This is a petition for judicial review, competent only where the supervisory jurisdiction of the court is invoked (see eg Gray v Watson [2014] CSIH 81 and authorities there cited). The petitioner’s claim for damages is based on Francovich state liability criteria. It forms part of the invocation of the court’s supervisory jurisdiction and cannot, in my opinion, be detached and treated as if it were a private law action for damages. If, as I have held, the petitioner’s application for judicial review is excluded by mora, taciturnity and acquiescence, it is excluded in toto and not merely to the extent of some of the remedies sought.”
Submissions
Submissions for the Petitioner
[9] Senior counsel for the petitioner adopted his Note of Argument, but indicated that he did not intend to rely on ground of appeal 1(e).
[10] Under reference to ground of appeal 1(a), senior counsel submitted that in the context of what the Council itself described as a complicated project, and against the background that the petitioner was not a party to the contract and was only provided with information by the Council on a piecemeal and protracted basis, the first requirement of a plea of mora, namely unreasonable delay, was absent. This was not a straightforward challenge such as that in United Co-operative Limited v National Appeal Panel for Entry to the Pharmaceutical Lists 2007 SLT 831. The respondent provided sporadic, partial and selective disclosure of essential documents, ending with disclosure of around 12,500 pages on 23 March 2015. Against that background, it was not unreasonable (particularly considering the expenses of litigation) for the petitioner to wait for the documentation sought by Freedom of Information requests before raising proceedings. The Lord Ordinary expressed his view that the mora clock began to run in April 2014, when the petitioner first expressed concern about procedures relating to the contract. However, the contract was only awarded on 20 August 2014, and the clock could not start until then. The respondent’s decision to disclose only limited types of information in reply to the FOI requests, in fragmented fashion, actively hampered the petitioner’s preparations. Prior to the disclosure of about 12,500 pages on 23 March 2015, the petitioner was given express legal advice that litigation was inadvisable. The petitioner saw the final contracts awarded (lease, public access and retail agreements) and information on the payment of technical services only in March 2015. MMS sent a detailed letter to HIE on 20 April 2015 and to the Council on 14 May 2015 in an attempt to avoid litigation. The petition was raised at the end of May 2015. In a matter of such complexity, the Lord Ordinary erred in holding that there had been unreasonable delay.
[11] Turning to grounds of appeal 1(b) and (c), taciturnity and acquiescence go hand in hand in the particular circumstances of this case. Senior counsel submitted that it was impossible to describe the petitioner as taciturn, and also impossible to infer acquiescence. The Lord Ordinary was correct to make no criticism of the petitioner’s decision to adopt the route provided by the Freedom of Information (Scotland) Act 2002, rather than that provided by the Administration of Justice (Scotland) Act 1972; the 2002 Act provides a mechanism to obtain the same information without the expense of court proceedings. In considering taciturnity, it was relevant to ask the question ‑ why was the petitioner looking for this documentation? Either it was fulfilling the role of an altruistic do‑gooder, or it was a person aggrieved, who had instructed solicitors and said “this is unlawful”. An objective by‑stander would say that this falls into the second category. MMS had alleged that the Council was in breach of its duties to their client; the Council responded by maintaining that it had conducted the procurement exercise with transparency and integrity. There was no doubt about the dispute between the parties. The considerations for mora in relation to a claim for damages are not the same as those where the remedy sought is reduction. There was nothing in the actings of the petitioner or MMS which must have seemed to the respondent “eloquent of a change of heart” by the petitioner (in contrast to United Co-operative at paragraph [32]). Here, the petitioner’s original complaints were bolstered by repeated attempts to find out the true position, and they were not provided with the information they sought until 23 March 2015.
[12] The Lord Ordinary’s approach contrasts with that of the court in Portobello Park Action Group Association v City of Edinburgh Council 2013 SC 184. In that case the chronology of events was set out at paragraph [9] of the Opinion of the Extra Division; this extended over a much longer period than the present case, from January 2006 until July 2011. The court referred, with apparent approval, to Lord Glennie’s approach in the United Co-operative case. The observations of the court at paragraph [19] apply with equal force in the present case ‑ the difficulties of obtaining information, the costs and time taken by litigation which is not to be undertaken lightly, and the Council’s recognition that there was a dispute all resonate with the present case. There has been no taciturnity in the present case ‑ nothing which would objectively allow the inference of acquiescence (reluctant or otherwise) to be drawn.
[13] Prejudice formed no part of the discussions before the Lord Ordinary, and is not a necessary element in a plea of mora, taciturnity and acquiescence, unless it is part of the inference of acquiescence. Without delay and taciturnity one cannot infer acquiescence, so prejudice is not relevant; in any event, where is the prejudice when considering a claim for damages? There is no authority to suggest that it is prejudicial to be held to the consequences of one’s own unlawful acts. Prejudice is not part of the equation in this case, it is not made out in this case, and it is not relevant.
[14] Turning to ground 1(d) it now appears that, in clear breach of EU procurement rules, the respondent provided the successful bidder with the invitation to tender “for quiet review” before the tender process began. Emails dated 15 August 2012 suggest that there were discussions between the chief executive officer of the successful bidder, HIE and the respondent at about that time. On 2 September 2012 a director of CuthbertWhite Limited, who were advising the successful bidder in the procurement exercise, emailed the respondent. This email stated inter alia “you mentioned you would send us a document for quiet review purposes and we look forward to receiving this when you have a moment”. This occurred before the invitation to tender was issued and before it was published by the respondent in the EU journal. Despite the request from MMS dated 26 September 2014, there was no mention of these emails, or any such discussions for quiet review, in the respondent’s letter dated 24 October 2014. In their letter dated 7 November 2014 MMS wrote to the respondent seeking details of a meeting between CuthbertWhite and the respondent, and details of the “document for quiet review purposes”. The disclosure of some 12,500 documents which was made by the respondent on 23 March 2015 did not include any documents in relation to these matters. Indeed, senior counsel indicated that the petitioner has still not seen any such documentation. On 22 September 2015 the respondent adjusted its answers by inserting the averments which followed the words “quoad ultra denied” in Answer 16. Although the draft second ITT has been disclosed to the petitioner, no correspondence relating to it has been disclosed. Public procurement exercises require to be transparent and to give equal treatment; to allow one potential tenderer an advance sight of a draft ITT is in itself actionable. The petitioner sought disclosure of this material on 7 November 2014 but were never given it. After these proceedings were raised, mention of the material was added to the pleadings on 22 September 2015, but disclosure has still not been made. Mora is an equitable plea. Standing the lack of transparency and the failure to disclose by the respondent, this is a factor which the Lord Ordinary should have taken into account. Although this submission was made to the Lord Ordinary, he did not address the argument in his Opinion. He was in error not to do so.
[15] Turning to his second ground of appeal, Mr Dunlop submitted that the Lord Ordinary erred in law in finding that the petitioner’s claim for damages formed part of the invocation of the court’s supervisory jurisdiction and could not be detached and treated as if it were a private law action for damages. The claim is now for damages only (declarator being sought only to found that claim). The petitioner seeks Francovich damages, claims for which are dependent on three, and only three, substantive conditions (Francovich v Italian Republic [1991] ECR I ‑ 5357; Brasserie du Pêcheur SA v Federal Republic of Germany [1996] ECR I ‑ 1029, particularly at paragraphs 51 ‑ 53 of the Judgment of the court), videlicet:
(a) the rule of law claimed to be infringed must be intended to confer rights on individuals;
(b) the breach must be sufficiently serious and, in particular, there must be a manifest and grave disregard by the Member State of its discretion; and
(c) there must be a direct causal link between the breach of the obligation resting on the Member State and the damage sustained by the injured party.
[16] A claim for Francovich damages is quintessentially a private damages claim. There is no requirement to invoke the supervisory jurisdiction of the court for such a claim, and it would be an unwarranted addition to the three conditions stated above to require this.
[17] The Lord Ordinary himself in unrelated proceedings has stated that “it may be that a claim ... for Francovich damages would have to be pursued in a standalone action” ‑ McGeogh v Electoral Registration Officer, Dumfries and Galloway, 2011 SLT 633, at paragraph 36. Indeed, the same Lord Ordinary dealt with a claim for Francovich damages in an ordinary action on the commercial roll (not invoking the supervisory jurisdiction of the court) in Angus Growers Limited v Scottish Ministers 2016 SLT 529 (see particularly paragraphs 27/28 and 48).
[18] In England, claims for Francovich damages are essentially private law proceedings which can and prima facie should be brought by an ordinary claim ‑ Phonographic Performance Limited v Department of Trade and Industry [2004] 1 WLR 2893, at paragraphs 47 ‑ 50. In Scottish terms, a claim for Francovich damages is a claim in delict, to which the provisions of section 6 of the Prescription and Limitation (Scotland) Act applies, and time only starts to run when damages are suffered. In the present case this means when the contract was awarded to another firm, ie August 2014. There is no tripartite relationship such as would require an application to the supervisory jurisdiction ‑ this is a claim for damages for a wrong done by A to B. In England it is accepted that a Francovich damages claim is one which “must be treated as a claim in tort” ‑ Spencer v Secretary of State for Work and Pensions [2009] QB 358; Phonographic Performance Limited (supra); R v Secretary of State for Transport ex parte Factortame Limited (no 6) [2001] 1 WLR 942 particularly at paragraphs 154 ‑ 157. There is no logical reason why such claims should be treated differently in Scots Law.
[19] Sidey Limited v Clackmannanshire Council 2010 SLT 607 was not concerned with a claim for Francovich damages. The observations of the court at paragraph 36 in that case cannot therefore be taken to support the proposition that a claim for Francovich damages simpliciter must be made by means of an application to the supervisory jurisdiction. Indeed, such a proposition would undermine the decision in Angus Growers (supra), and would be contrary to the decision of the Supreme Court in Ruddy v Chief Constable, Strathclyde Police, 2013 SC (UKSC) 126, particular per Lord Hope of Craighead DPSC at paragraphs [14] ‑ [19]. This reasoning, particularly at paragraph [15], applies equally in the present case ‑ the petitioner is now not seeking to set aside anything, but complains of completed acts. Just because the person who is being sued is a public authority and there is a public law context does not require a claimant to use Judicial Review procedure. Under reference to the observations of the Supreme Court in R (on the Application of Ingenious Media Holdings Plc) v HMRC, [2016] UKSC 54, particularly at paragraphs 14 and 28, senior counsel submitted that it would be a cardinal error in the present case to hold that just because the Council is a public body, the petitioner is seeking to invoke the supervisory jurisdiction when claiming damages ‑ it is not. If the petitioner had raised a commercial action for damages now in relation to an event in August 2014, it would, he submitted, be impossible to suggest that mora, taciturnity and acquiescence should act as a bar to prevent the claim; the court should be slow to add, by decision, a plea of bar or discharge resulting from mere lapse of time, which the legislature has not thought fit to sanction by statute. “We are not to rear up new kinds of prescription under different names” ‑ Assets Co Limited v Bain’s Trustees (1904) 6F 692 per Lord President Kinross at 705, referred to with approval by Lord President Rodger in William Grant & Sons Limited v Glen Catrine Bonded Warehouse Limited 2001 SC 901 at paragraph 43.
[20] It is important to bear in mind the distinction between a private claim for damages, covered by the Prescription and Limitation (Scotland) Act 1973, and a Judicial Review supervisory remedy which is not so covered. This is a claim for reparation covered by section 6 of the 1973 Act. The effect of the Lord Ordinary’s decision is to reduce the quinquennial period by more than 80%. This is neither consistent with precedent nor with the 1973 Act.
[21] For all these reasons, or any of them, senior counsel submitted that the Lord Ordinary’s interlocutor should be recalled, and the action remitted to the Lord Ordinary to proceed as accords.
Submissions for the Respondent
[22] In moving us to refuse this Reclaiming Motion and in adopting her Note of Argument, senior counsel for the respondent reminded us that the petitioner made a deliberate choice not to submit a bid for these contracts; they did not compete, so they have no complaint that their offer was not properly considered. Moreover, the duty on the respondent in this procurement exercise was a duty owed to the public at large, and not specifically to the petitioner. The submissions for the respondent would be divided into three chapters ‑ (1) the nature of the plea of mora, taciturnity and acquiescence; (2) the nature of the remedy sought by the petitioners, in its correct factual and legal context; and (3) the application of the facts to the essential three elements required for the plea to succeed.
[23] Turning first to the nature of the plea, senior counsel acknowledged that more than mere lapse of time was necessary in order for the plea to be sustained. It is not a plea of prescription and it does not raise any new prescriptive period. All that the Lord President was saying in Assets Co v Bain’s Trustees at page 705 was that one cannot rely on delay on its own, for to do so would be to create a new form of prescription. All three elements of the plea are required. However, the plea may operate in cases where prescription does not apply; this is important in both the public and private sphere. The plea may apply to a claim for damages only, including a claim for Francovich damages. Acquiescence can be inferred from all the circumstances; prejudice may be relevant and may operate as an alternative to acquiescence. Prejudice was occasioned to the respondent in the present case, and arose because the petitioner chose not to adopt the primary and effective remedy of reduction at a time when that would have been possible. In the administrative field, this remedy should be sought promptly in the interests of efficiency and certainty, which are objectives in the public interest. This case falls squarely within the context of administrative law, where the need for certainty and efficiency is a relevant consideration when the plea is being considered. The primary remedy in the field of public procurement is to interrupt the award of the contract, to enable a decision to be set aside ‑ hence the standstill period during which the public authority cannot conclude the award. Senior counsel for the petitioner was wrong to categorise mora, taciturnity and acquiescence as an equitable remedy ‑ if all the requirements are satisfied, the court has no discretion. Senior counsel adopted Lord Penrose’s analysis in Pickering v Kyle and Carrick District Council, quoted at paragraph [28] of United Co-operative Limited.
[24] Turning to the nature of the remedy sought, in its correct factual and legal context, senior counsel accepted that there were three requirements for Francovich damages, but they do not remove defences which may exist, such as prescription, mora, taciturnity and acquiescence, res judicata or personal bar. The three requirements merely set out what is necessary for a relevant claim. The relevant claim is founded on a breach of EU law, and proceeds on the basis of the fundamental rule of EU law that remedies for a breach of EU law have to be effective. Francovich damages fill a gap for a remedy which would not otherwise exist, to ensure that EU law is properly implemented. In the present case, the petitioner avers that the award of the contract was in breach of EU law and natural justice ‑ but it cannot aver that the petitioner should have been awarded the contract. If the respondent failed to carry out the procurement procedures compatibly with EU law and natural justice, the Member State must ensure an effective remedy. That remedy is to seek a “rewinding” so that the decision can be made afresh, untainted by illegality. Senior counsel accepted that there may be cases in which the remedy of reduction is not possible or not available ‑ eg where a statute or statutory instrument is in breach of EU law. Where the wrongful act has been completed, as in Ruddy or Angus Growers, reduction may not be possible. Where, because of the passage of time, restitutio in integrum is not possible (which is the situation in the present case) reduction will not be available. If reduction is not available, EU law requires there to be an effective remedy as an alternative; but damages are to be seen properly as an alternative to reduction, and only arising if reduction is impossible. Even if reduction is not available, this does not affect the authority’s ability to plead mora, taciturnity and acquiescence. The reason why reduction is not possible here is because of mora, taciturnity and acquiescence ‑ and that being the case, the plea is as good against a claim for Francovich damages as it is against a claim for reduction. Senior counsel considered the cases of Brasserie du Pêcheur (supra), Spencer (supra), Phonographic Performance Limited (supra), and Delaney v Secretary of State for Transport [2015] 1 WLR 5177; in each of these cases the plaintiff was unable to reduce or suspend a wrongful act, and so the only remedy was a claim for damages, and the unlawful act prevented the entitlement to the effective remedy of reduction. There was nothing in any of these authorities to suggest that a plea of mora, taciturnity and acquiescence (or the equivalent) was not a proper defence in such a situation.
[25] The circumstances in Angus Growers were quite different from the present. In that case, the pursuers successfully challenged an unlawful act, but while they were subjected to it, they suffered loss. They therefore had a standalone claim for damages (see paragraph [28]). The claim in the present case is truly an alternative to reduction; there was no barrier to seeking reduction, and reduction of the decision to award the contract would have been an effective remedy. A claim for Francovich damages in the present case is as open to a defence of mora, taciturnity and acquiescence as the original reduction claim. If the plea was good for reduction, it also holds good for damages.
[26] In the circumstances of this case, the principles of good administration are as applicable to a claim for damages as they are to a claim for reduction. As with planning cases, speed is of the essence in procurement cases, and it is likely that an authority will move quickly on a decision it has made. This requirement for a claim to be made promptly in the field of administrative law is now increasingly widespread ‑ eg the Concessions Contracts (Scotland) Regulations 2016, and the recent amendments to the Court of Session rules regarding the timescale for raising Judicial Review proceedings.
[27] The plea of mora, taciturnity and acquiescence requires a consideration of the facts of the case. The facts of this case are squarely in the public law/administrative law field, and they do not change just because the petitioner has dropped its claim for reduction because it recognises that the decision to award the contract was made too long ago to be changed. The Lord Ordinary was correct when he stated (at paragraph [27]):
“I am not persuaded that by excising the conclusion for reduction, the action loses its character of a public law challenge and acquires instead an entitlement to benefit from a more relaxed attitude to mora and taciturnity appropriate to a private law action.”
[28] Ruddy v Chief Constable, Strathclyde Police did not provide support to the petitioner, despite Mr Dunlop’s submissions to the contrary. Ruddy was essentially a private right of action, and was properly analysed as a private law case. The present case is a public law case. Simply to seek damages now is to concentrate on form rather than substance. By restricting the claim to damages, the petitioner does not make this a private law claim. The facts and substance of McGeogh v Electoral Registration Officer, Dumfries and Galloway were quite different. The Lord Ordinary held that damages were a standalone remedy for the failure to be put on the electoral roll. This adds nothing to the petitioner’s case.
[29] Turning to her third chapter, Ms Crawford considered the application of the facts of this case to the essential three elements of the plea. In Portobello Park Action Group the court held that the starting point from which any possible delay should be considered for the purpose of mora was 23 February 2011, being the date on which planning permission was granted. Applying that reasoning to the circumstances of the present case, when did the petitioner have the opportunity to oppose the award of this contract? The answer was that the Lord Ordinary was correct in saying that the clock began to run in April 2014, or at the very latest June 2014. By then, the petitioner had a prima facie basis to oppose the award of the contract. They did not need to have fully formulated grounds, and they may not have had all the evidential material to establish a claim, but their solicitors must be taken to have acted responsibly when they asserted several bases for challenge. If the petition had been raised in June 2014, the respondent would not have proceeded to conclude the development agreement with Natural Retreats ‑ see paragraph 7 of the affidavit of Joseph MacPhee, Head of Economic Development at the respondent.
[30] Senior counsel went on to consider whether there was unreasonable delay on the part of the petitioner in raising proceedings, in context and against the background of the email correspondence set out above (and under reference to paragraphs 5 ‑ 16 of her Note of Argument). In particular, MMS in their letter dated 18 June 2014 made assertions of breaches of the rules relating to pre‑tender discussions, post‑tender negotiations, state aid and ERDF funding, and requested that the current tender process be withdrawn. This was during the standstill period. The Council responded on 26 June 2014 denying that they had acted in breach of the rules. Mr Dunlop had submitted that the letter from MMS dated 30 June 2014 should be read as a request to allay the petitioner’s suspicions ‑ but it should be noted that there is no reference in that letter to either of the above letters. The letter from MMS dated 11 September 2014 was after the award of the contract and the publication in the journal. It contained positive assertions that the pre‑tender discussions and post‑tender discussions were unlawful, but all that MMS were instructed to do was to bring the matter to the attention of the European Commission and Audit Scotland. This does not amount to speaking out, as against the Council, of the right to challenge its award of the contract. The reply from the Council dated 15 September 2014 stated that “your client has had time to challenge the procurement process and has not done so.” At no time did the petitioner or its agents state that this was wrong or that they intended to challenge the award of the contract. There then followed protracted correspondence about FOI requests. The respondent receives on average about 85 such requests each month. Complaints and/or FOI requests do not give rise to an expectation that legal proceedings will be raised. There was no suggestion by or on behalf of the petitioner that litigation was in contemplation. (When asked by the court whether it would have mattered if the letters from MMS were headed “proposed action against the Council”, senior counsel replied that it might well have done.)
[31] The explanation for the delay in raising proceedings proffered on behalf of the petitioner cannot result in the delay being regarded as reasonable in all the circumstances of this case. The emails dated 15 August 2012 were disclosed on 8 July 2014 (not in March 2015 as indicated by Mr Dunlop). The petitioner could and should have raised proceedings during the standstill period before the contract was awarded. The petitioner had sufficient information to raise proceedings seeking interim remedies on the basis of unlawful pre‑tender discussions and post‑tender discussions (information of which was disclosed in June and August 2014). The petitioner knew that the contract had been awarded; its failure to act earlier than it did was unreasonable. It had a sufficient basis to make allegations, and (if this had been a 2012 regulations case) complexity and the number of documents would not have been a good excuse for delay. The principles of good administration apply equally in the present case.
[32] The first intimation that the respondent had that the petitioner was contemplating litigation was the letter from MMS dated 14 May 2015. The petition when it was eventually lodged contained nothing more than was contained in Mr McKenzie’s aide memoire for the meeting dated 17 April 2014, and the letter from MMS dated 18 June 2014. There are well‑established procedures to enable documents to be recovered. Mr Dunlop relied on the complexity of the contractual background, but all procurement cases are complex. Nonetheless, the petitioner and its agents were still able to make specific complaints about what was wrong with the procurement process, and none of the explanations for not raising proceedings earlier excused the delay.
[33] With regard to the petitioner’s ground of appeal 1(b), relating to taciturnity, the Lord Ordinary did not err at paragraph 24 of his opinion in holding that there had been a failure by the petitioner to speak out in assertion of its right or make a claim. It cannot properly be inferred from the numerous FOI requests that the petitioner was speaking out in assertion of its right to challenge the contract. The letter from MMS dated 18 June 2014 was not a speaking out asserting this right. Similarly with regard to ground of appeal 1(c), the Lord Ordinary was correct to hold that reluctant acquiescence may reasonably be inferred from the petitioner’s delay and taciturnity. The petitioner did not avail itself of the opportunity to challenge the award of the contract when it could and should have done so, and as a result acquiescence may be inferred.
[34] The email dated 2 September 2012 which referred to sending a document “for quiet review purposes”, which is the subject of ground of appeal 1(d), was disclosed to the petitioner on 25 October 2014. The petitioner was able to make averments about unfair treatment in Statement 47 of the petition as lodged, and was subsequently able to make averments about the email referring to “quiet review”. This does not render the delay in raising the proceedings reasonable.
[35] In conclusion, senior counsel submitted that it was established from the facts that the petitioner unreasonably delayed in raising proceedings, it was taciturn, and its acquiescence in the unlawful procurement exercise could reasonably be inferred. This applies even if one regarded this as a private action, because the same principles of good administration apply here, together with the need for certainty, effectiveness and relatively speedy action. The principles of good administration apply to procurement law. The Reclaiming Motion should be refused.
Reply for the Petitioner
[36] Mr Dunlop suggested that the notion that there were two types of claims for Francovich damages was unprecedented and unsupported by authority. The duty owed by public authorities was not owed to the public at large, but to public operators.
[37] He accepted that whether to sustain a plea of mora, taciturnity and acquiescence was not truly a discretionary matter for the court, but it is equitable ‑ see William Grant and Sons Limited v Glen Catrine Limited at paragraph [4]. The respondent’s reasoning was as follows: the petitioner’s primary remedy was reduction, and that had to be resorted to, and a private claim for Francovich damages was only available if reduction was impossible - if the petitioner seeks damages, it is still within the province of Judicial Review. This reasoning is flawed. The distinction between private law claims and the supervisory jurisdiction was discussed in Tonner v Reiach and Hall 2008 SC 1, and in United Co-operative Limited; as Lord Glennie observed in the latter, in private law claims one may be considering delay in terms of years, not months. In Brasserie du Pêcheur at paragraph 51 the court was considering not a right to reduction or set aside, but a right to reparation. It stated that Community law confers a right to reparation where three conditions are met. Ms Crawford seeks to add another condition to Francovich damages, namely that one must first claim reduction, which EU law prohibits. There is nothing in Phonographic Performance Limited v Department of Trade and Industry nor in Factortame to indicate that one can only claim Francovich damages because a UK statute cannot be overturned and so reduction is not available. There is no authority for the proposition that Francovich damages are only available when reduction is not available, and there is no authority supporting any demarcation between different Francovich claims. One is therefore thrown back to the distinction between the supervisory jurisdiction on the one hand (see Ruddy) and a claim for damages on the other hand. Delay in claims of damages is measured in years. Mr Dunlop posed three questions for the court, and helpfully answered them, as follows: was it unreasonable for the petitioner to await the result of its ongoing FOI requests? No. Can it really be said, looking at matters in the round, that the petitioner was taciturn? No. Can one infer objectively acquiescence on the part of the petitioner to the point of abandoning a claim for damages? No. In these circumstances the Reclaiming Motion should be allowed.
Decision and Reasons
[38] We have reached the conclusion that, in the particular circumstances of this case, the respondent’s second plea in law that the petitioner being barred by mora, taciturnity and acquiescence the prayers of the Petition should be refused cannot be sustained, and we shall therefore grant this Reclaiming Motion. In doing so, we reiterate that the issues which were live before the Lord Ordinary when he sustained that plea were much wider than the issues now before this court. It is clear from his Opinion that much of the argument before the Lord Ordinary focused on the plea in the context of a Petition seeking reduction of the decisions to award the contracts. It is perhaps not surprising therefore that the Lord Ordinary concentrated his mind principally on that context. The assessment of whether delay is so unreasonable as to amount to mora, whether a claimant has been taciturn, and whether acquiescence can properly be inferred, are all matters which are dependent on the factual and legal context of each case. In the context of the case now before this court, we have reached the conclusion that the respondent’s second plea cannot be sustained.
[39] The Lord Ordinary distilled six propositions as to the application of the plea of mora, taciturnity and acquiescence at paragraph [19] of his opinion, which he understood were not controversial. Neither party before this court took issue with them, and we accept them. They are as follows:
(i) In order for the plea to succeed, all three elements must be present.
(ii) Whether delay on the part of the applicant is sufficient to found the mora element will depend upon the whole circumstances of the particular case, but is likely to be considerably shorter in cases of judicial review than the delay required to found the plea in cases concerning private rights.
(iii) Taciturnity connotes a failure to speak out in assertion of one’s right or claim.
(iv) Acquiescence is not to be determined subjectively by looking into the mind of the applicant but is to be inferred objectively from the other two elements, ie delay and silence on the applicant’s part.
(v) Prejudice to, or reliance by, the person whose actions are challenged is not a necessary element of the plea, nor should prejudice be seen as an alternative requirement to acquiescence. Prejudice or reliance may however form part of the circumstances from which acquiescence may be inferred.
(vi) The concept of detriment to good administration may have a part to play where administrative action has been taken in the belief that the applicant has acquiesced in the actings in question.
[40] In assessing whether any delay on the part of a petitioner (or pursuer or other form of claimant) is unreasonable, it is necessary to look at all of the particular circumstances of the case. These include the factual background, and the legal context, including the remedy or remedies sought. What is reasonable in one set of circumstances may be unreasonable in another.
[41] The assessment of whether delay has been reasonable or unreasonable must begin with the analysis of the starting and finishing points of the period being considered. At paragraph [23] of his opinion the Lord Ordinary expressed the view that the period that falls to be scrutinized for mora, taciturnity and acquiescence began on 18 June 2014, when MMS stated the petitioner’s principal complaints, under reference to a supporting factual background. However, at paragraph [24] he referred to the letter from MMS to HIE dated 20 April 2015 and stated that this was “just over a year after the date when, in my view, the mora clock began to run”. At paragraph [25] he stated that:
“by allowing a period of a year to elapse from the time when it became aware of grounds of challenge of an award of a contract to the company, and eight months to elapse from the time when it received information in response to its first FOI request and also became aware that the contract had been awarded, before intimating any intention to mount a court challenge to the award, the petitioner in my opinion delayed for an unreasonably long time…”
[42] It is not clear to us what the Lord Ordinary took to be the starting point of the period which fell to be assessed. In the context of the legal remedies sought at the time of the first hearing, which included reduction of the decisions to award the contracts, it may be that the Lord Ordinary was justified in adopting a starting point of early April 2014 or 18 June 2014, by which time the petitioner was able to express concerns about relatively specific apparent breaches of the public procurement regime and natural justice. If the petitioner had wished to prevent the decision to award the contracts, it might (we put it no higher) have been able to seek interim remedies to that end – albeit with the risks attendant on such a course of action.
[43] However, what the petitioner now seeks is Francovich damages for the respondent’s award of the contracts. The petitioner had, on several occasions, expressed its concerns to the respondent that the respondent had engaged in pre-tender discussions and post‑tender negotiations; the respondent denied this, and proceeded to award the contracts despite the concerns expressed by or on behalf of the petitioner. The notice publicising the award of the contract was published on 20 August 2014. The petitioner now seeks damages for this completed act. We do not consider that the petitioner can be criticised for not raising proceedings before publication of the notice that the contracts had been awarded; the respondent might have reconsidered its position in light of the concerns expressed on behalf of the petitioner, and might have decided not to award the contract to Natural Assets. We do not consider that the petitioner was obliged to raise proceedings before the award of the contract – the reasoning of Lord Steyn in R(Burkett) v Hammersmith and Fulham London Borough Council (1) at paragraph 42, which was adopted by the Extra Division in Portobello Park Action Group at paragraph [17], applies here. We consider that the starting point for assessing whether the petitioner in the present case delayed unreasonably, in the context of a claim for Francovich damages, is 20 August 2014.
[44] The petitioner’s solicitors wrote to the respondent on 14 May 2015 indicating that the petitioner had instructed them to raise an action in the Court of Session for Judicial Review seeking reduction of the award decision and damages. The petition was lodged on 28 May 2015. We consider that the period to be examined for possibly unreasonable delay is from 20 August 2014 to 28 May 2015.
[45] There are, as senior counsel for the respondent observed, several regulatory regimes, particularly in the field of administrative law, which lay down fixed time limits within which steps to challenge a decision must be made. The provisions of the Town and Country Planning (Scotland) Act, the Concession Contracts (Scotland) Regulations 2016, and indeed section 27A of the Court of Session Act 1988, are examples. However, it is important to remember that we are not considering such regulatory regimes here, but the plea of mora, taciturnity and acquiescence, which is flexible in its application, and which may be stated in many different forms of proceedings (whether in the administrative law field, public and private law remedies, contract, delict, ordinary action or petition). It is not precluded by the presence or absence of other regulatory regimes, and it may be stated by a defender/respondent which is a public body just as it may be stated by an individual or a company. It may operate where prescription does not apply. As already indicated, the way in which it is approached by the court will vary depending on the whole circumstances.
[46] The Extra Division in Portobello Park Action Group had regard (at paragraph [19]) to a variety of considerations when deciding that the plea of mora, taciturnity and acquiescence should not have been sustained in that case. Many of the same considerations apply to the present case. Litigation is expensive, time consuming and sometimes conducted at considerable personal cost; it is not to be undertaken lightly. In the present case, the petitioner and its agents expressed clear concerns about what appeared to it to be important breaches of proper procedure. The petitioner was not a party to the contracts, and was not privy to the details of discussions, meetings, correspondence and agreements. It required to make repeated FOI requests to the respondent in order to obtain those details, and a large amount of information was not disclosed to it until about 24 December 2014, with a further large number of documents disclosed on 23 March 2015. The Council was not notably prompt or cooperative in disclosing all information: we regard senior counsel for the petitioner’s description of this process as a “slow drip-feed of disclosure” as not unfair. The contractual procedures and arrangements were complex; no doubt this is the case in most public procurement exercises, as observed by senior counsel for the respondent, but it is nonetheless a factor to be considered. The challenge by the petitioner was not straight forward and until the receipt of around 12,500 pages of documentation in late March 2015 the legal advice which the petitioner received was that litigation was inadvisable. Even now, some documents which the petitioner has called for have not been produced.
[47] In light of all of these factors, we do not consider that the elapse of time from 20 August 2014, when notice of the award of the contracts was published, until 28 May 2015 when the petition was lodged, amounts to an unreasonable delay in the particular circumstances of this case (which circumstances include the fact that the only remedy which the petitioner now seeks is Francovich damages).
[48] With regard to taciturnity, the Lord Ordinary observed (at paragraph [24] of his opinion) that:
“It might at first sight seem curious to describe the petitioner’s approach as taciturn, having regard to the lengthy correspondence comprising the FOI requests and the responses of the Council and HIE to those requests. But the word ‘taciturnity’ must be understood in context.”
We accept that the word must be understood in context, but we do not agree that the sequence of emails set out at paragraph [6] above can properly be described as a failure to speak out in assertion of the petitioner’s right or claim. While it is correct to observe that the making of a FOI request does not of itself carry an implication that court proceedings are in contemplation by the person requesting the information, we consider that, seen in their context, these emails must be seen as seeking information to enable the petitioner to make a relevant and specific claim. The letter from MMS to the Council dated 18 June 2014 asserted that the Council appeared to be in breach of a duty owed to the petitioner. Although reference is made in several letters to the public interest in the procedures being properly applied in accordance with the principles of equal treatment and transparency, the tone and content of the correspondence from MMS on behalf of the petitioner was clearly not just that of a disinterested person proceeding in the public interest, but was on behalf of a commercial operator whose interests appeared to have been damaged by the respondent’s breach of duty. The normal inference to be drawn where a person goes to the expense of instructing solicitors is that he intends to protect his own interests, by legal means if necessary. We do not consider that there was any justification for an assumption that the petitioner was simply instructing them in the public interest. The very use of solicitors was an indication of intention to enforce a legal right. We do not consider that the second element of the plea, namely taciturnity, has been made out in this case.
[49] Acquiescence is to be inferred objectively from unreasonable delay and taciturnity. Standing our view that neither unreasonable delay nor taciturnity has been made out, acquiescence does not arise. In any event, we are unable to infer even reluctant acquiescence from the course of correspondence and exchange of emails in the relevant period. If the respondent had provided full disclosure of all the documents relating to the award of these contracts, and pre-tender discussions and post-tender negotiations, including material relating to documents sent for “quiet review purposes”, within a month of 20 August 2014, and there had been no further correspondence but complete silence from the petitioner until the petition was lodged in late May 2015, matters would look different. In such circumstances, it might well be (we go no further) that taciturnity was made out and acquiescence could properly be inferred. However, given the petitioner’s agents’ repeated demands for further information, and the vast amount of information which was not provided until late March 2015, it seems to us that the cause of the elapse of time until proceedings were raised lay primarily with the respondent. In such circumstances, we think that the court should be slow to sustain the plea of mora, taciturnity and acquiescence.
[50] We are satisfied that the petitioner’s second ground of appeal is well-founded. Ms Crawford submitted that although the petitioner had abandoned its claim for reduction, this was the primary remedy in the field of public procurement, hence the standstill period. She maintained that Francovich damages are truly alternative to that primary remedy, and the plea of mora, taciturnity and acquiescence is as good against a Francovich damages claim as it is against a claim for reduction of the contract.
[51] We do not suggest that the plea may not be sustained even where the remedy sought is confined to damages; however, the considerations which apply to it may well be different, or may be given different weight, in a case in which the whole circumstances include the fact that the only remedy sought is damages. The need for a swift, prompt challenge, and an expeditious procedure for determination by a court, is greater where the remedy which is sought is the quashing of an administrative decision than it is where the remedy sought is simply damages. In the former, there may be many parties who have an interest in the result, there may be important public works which require to be carried out as a matter of urgency, and there is the public interest in certainty, efficiency and good administration. In the latter, the claim is restricted to payment of damages by A to B. Although the claim is made against a public body, and arises in the context of administrative acts by that body, it is in many respects a standard private law claim – it is akin in this respect to a delictual claim for personal injuries occasioned by the fault of a public authority, or a claim for damages for breach of contract by that authority. In England, a claim for Francovich damages is not categorised as a public law right - Phonographic Performance Limited at paragraph [48]. We see no reason why a claim in Scotland which comprises only a Francovich damages claim requires to be presented as a petition for Judicial Review: the supervisory jurisdiction of the court is not engaged in such a situation. Indeed, the view that such a claim may need to be pursued in a stand-alone action receives support from McGeogh v Electoral Registration Officer, Dumfries and Galloway at paragraph [36], and from Angus Growers Limited v Scottish Ministers. We endorse that view.
[52] The views expressed by the First Division in Sidey Limited v Clackmannanshire Council, particularly at paragraph [36], must be seen in the context of the dispute in that case, and the remedies sought. In that case, which was also concerned with public procurement procedures, the pursuers sought an order in terms of the regulations then in force to set aside the Council’s decision to award a public works contract to the second defender, and further sought suspension and reduction of the purported contract. The pursuers also sought specific performance of an alleged statutory duty, and damages if the contract was not reduced, but there was no claim for Francovich damages. The court held that the issues raised, and the remedies sought, in that case necessitated resort to the supervisory jurisdiction of the court by way of a petition for Judicial Review. This does not support the proposition that a claim for Francovich damages simpliciter must always be made by way of petition for Judicial Review.
[53] The suggestion that such a claim must be made by resort to the supervisory jurisdiction of the court is in our view inconsistent with the decision of the UK Supreme Court in Ruddy v Chief Constable, Strathclyde Police, and in particular the analysis by Lord Hope of Craighead (at paragraphs [14] – [19]) of whether claims for damages against a public authority for breach of a procedural obligation required to be made to the supervisory jurisdiction. In the course of this analysis, Lord Hope observed:
“[15] The fallacy which undermines the Extra Division’s whole approach to this issue, however, lies in its assumption that the appellant is seeking an exercise of the court’s supervisory jurisdiction. That is not so. He is not asking for the review or setting aside of any decision of the chief constable or the Lord Advocate. He is not asking the court to control their actions in that way at all. His case in regard to both craves is based on averments of things done or omitted to be done and actions that were taken or not taken. The allegations are of completed acts or failures to act. He is not seeking to have them corrected in order to provide a foundation for his claim, nor does he need to do so. What he seeks is just satisfaction for the fact that, on his averments, his Article 3 Convention Rights have been breached. The essence of his claim is simply one of damages.
[19] The objection to the competency of the claim for just satisfaction for breach of the procedural obligation which is the subject of the second crave is in no better position. Here too the claim is in essence one of damages, and Judicial Review for its determination would be just as inappropriate. The decisions of which the appellant complains do not need to be reviewed and set aside in order to provide him with a basis for his claim.”
Lord Hope went on to compare the position of the pursuer in that case to the position of the pursuers in Mitchell v Glasgow City Council 2009 SC (HL) 21.
[54] We also agree with Mr Dunlop’s submission that there is nothing in the European jurisprudence which provides support for the view that a claim for Francovich damages must be made as an alternative to the “primary remedy” (as Ms Crawford described it) of reduction. To require this would be to add a further condition to the three conditions set out in Brasserie du Pêcheur. We see no justification for this.
[55] For these reasons, we consider that the petitioner’s second ground of appeal succeeds, and that the Lord Ordinary was in error at paragraph [27] of his opinion in rejecting what he described as the petitioner’s “fall-back argument”. We repeat that we do not suggest that a plea of mora, taciturnity and acquiescence cannot be sustained in a claim for Francovich damages simpliciter, but such a plea requires to be considered in a different context from a claim for reduction of an administrative act. There is nothing to prevent a claim for Francovich damages being raised by way of an ordinary action, whether on the commercial roll or otherwise (and of course, in terms of Rule of Court 58.16, the Lord Ordinary may order that a cause raised as a petition for Judicial Review should proceed as an ordinary action, if satisfied that it should proceed that way). If a claim for Francovich damages was raised on 28 May 2015 in respect of the award of a contract on 20 August 2014, we think it unlikely (but not, perhaps, impossible) that a plea of mora, taciturnity and acquiescence would be sustained in that context; claims for damages in delict are often raised some years after the completed act on which the claim is founded.
[56] For these reasons we shall allow this Reclaiming Motion, repel the second plea in law for the respondent and remit to the Lord Ordinary to proceed as accords.