legal risk in procurement - dla piper win · blackpool and fylde aero club v blackpool borough...
TRANSCRIPT
19/03/2015
1
Legal risk in procurement
Scott Alden
DLA Piper
19 March 2015
Overview
Contract Formation in the Procurement Cycle
Legal Risk In The Process
Collective Buying and Competition Risk
2In-House Counsel Day 2015
19/03/2015
2
Contract Formation
Procurement Type
Electronic
What are the Contract Terms
Incorporation by reference
Legal issues with online formation
Deeds
Communication of Acceptance
Consolidation / Finalisation of Contract
Authority
Traditional
Battle of the Forms
When is agreement reached
Consolidation of Contract / Tender
Authority
3In-House Counsel Day 2015
Legal Risk in the Process
The Process Contract
What is the Process Contract The Queen in Right of Ontario et al v Ron Engineering & Construction Eastern Ltd (1981) Canada
Blackpool and Fylde Aero Club v Blackpool Borough Council [1990] EWCA Civ 13
Hughes Aircraft Systems International and Airservices Australia (1997) 146 ALR 1
Ipex ITG Pty Ltd (in liq) v State of Victoria [2010] VSC 480
Ipex ITG Pty Ltd (in liq) (recs apptd) v State of Victoria [2012] VSCA 201
Why is it significant
What are the obligations of the Procurer / Responder Ron Engineering
City Polytechnic of Hong Kong v Blue Cross (Asia Pacific) Insurance [1994] HK CFI 355
4In-House Counsel Day 2015
19/03/2015
3
Legal Risk in the Process
The Process Contract
What are the legal and commercial issues if breached J&A Developments v Edina Manufacturer Ltd Amora Ltd & Ors [2008] NIQB 208
Discovering the process Griffin Energy Pty Ltd v Western Power Corporation [2006]
Telstra Corporation Limited v Minister for Communications, Information, Technology and the Arts (No. 3) [2007] FCA 1567
Avoiding the risks in the process contract Cubic Transportation Systems Inc & Anor v State of New South Wales & 2 Ors [2001] NSW SC 1195
Tercon Contractors Ltd v British Columbia (Transportation and Highways) 2010 SCC4
5In-House Counsel Day 2015
Legal Risk in the Process
Other Legal Risks
Misleading and Deceptive Conduct s18 Competition and Consumer Act (Cth) 2010
JS McMillan Pty Ltd v Commonwealth (1997) 77 FCR 337
Hughes Aircraft
Misrepresentation
Equitable Estoppel LMI Australasia Pty Ltd v Baulderstone Hornibrook Pty Ltd (unreported 10 April 2003)
Negligence
Injunctions
Breach of Confidence / Restraint of Trade
Administrative Law (Procedural Unfairness, Acting Unreasonably)
6In-House Counsel Day 2015
19/03/2015
4
Legal Risk in the Process
1. Not following the stated process
2. Not all information to tenderers at the same time (level playing field), uncontrolled site visits
3. Late tenders
4. Not disclosing criteria or using adopted criteria
5. Post Tender Negotiations
6. Using IP of losing tenderer to improve project with contractor
7. Disclosure – not disclosing as required or not giving post tender de-brief
7In-House Counsel Day 2015
Legal Risk in the Process
7. Entering into projects contracts that are significantly different to that tendered/inappropriate variations
Pressetext Nachrichtenagentur GmbH v Republik Osterreich (Bund) 2008
Edenred (UK Group) Limited v HM Treasury and anor [2014] EWHC 3555 (QB)
8. Improperly managed Conflicts of interest eg use of consultant in pre-Bid stage and allowing consultant to bid
9. Confidential Information – Leaks
10.Tender period
8In-House Counsel Day 2015
19/03/2015
5
International Trends in Procurement
United Kingdom
Competitive dialogue
10 day 'stand still' period before signing contract to allow unsuccessful bidders to bring a legal challenge
Procurement regulations in the UK correspond to the EU 'Directives'
New Directives (came into force in April 2014)
Purpose of the New Directives to simplify procurement – new texts are approximately 30% longer than those they replace
30 Day Limitation Period
In-House Counsel Day 2015 9
International Trends in Procurement
Canada
'Contract A / Contract B' framework – allows government agencies a significant amount of freedom to establish criteria that bidders must satisfy to submit a compliant bid on a contract (which is basically the terms and conditions in Contract A)
Obligations on the bidder and government agency
In-House Counsel Day 2015 10
19/03/2015
6
International Trends in Procurement
United States
Government Accountability Office – 'congressional watchdog'
Ability to suspend contract signing until bid protests have been made.
Ability to sustain protests eg Agency failure to follow stated evaluation criteria.
In-House Counsel Day 2015 11
International Trends in Procurement
Trends
Termination for Convenience / Abandoning Processes
Good Faith
Bid Challenges
In-House Counsel Day 2015 12
19/03/2015
7
Competition / Cartel Conduct
Competition and Consumer Act 2010
Making a contract containing a cartel provision (s 44 ZZRF)
Penalty - $10m
Collective buying – competing entities coming together to buy at a set price for a period. The fixing of a price is a 'cartel provision'
Collective buying exemption (s 44ZZRV)
Seek authorisations from ACCC directly
13In-House Counsel Day 2015
Key Contacts
In-House Counsel Day 2015 14
Scott Alden
Partner
Sydney Location Head – Finance and Projects
T: 02 9286 8128