Court rejects trust claim that contract cannot be delivered within budget

Royal Cornwall Hospitals Trust had accused Cornwall Council of unlawfully awarding a £2.5m contract to Brook. It claimed it would be impossible to run the services specified in the tender at that price. 

In February, the council retendered the sexual health services contract held by the trust since 2013. The council valued its new seven-year contract at £2.5m per year after carrying out market research in 2018 and 2019.

However, the trust, which was placed in quality special measures in October 2017, objected the figure was too low. It spends £3m on the service, generating a loss of £120,000 every year.

Three weeks after the council published its tender, the trust announced it would not bid for the service. 

In May, the council told the trust it would award the contract to Brook. Later that month, the trust launched a legal challenge to the High Court’s Technology and Construction Court to prevent the contract being awarded and force the council to relaunch the procurement with either a higher-value contract or different service specifications.

In its claim, the trust alleged Brook’s tender for the contract “could not have complied with the service specification within the financial envelope” or proposed a “level of resource that is abnormally low relative to the service specification”. It also argued that the council’s tender was irrational and “manifestly erroneous”. The council denied the allegations and asked the court to dismiss the case.

In his judgment, High Court judge Mr Justice Stuart-Smith said it was not for the court to determine which body was right about the contract value.He added the trust had missed the 30-day timeframe to challenge the procurement when the tender was launched in February and had shown no reason why it was unable to meet that deadline.

He also dismissed the trust’s claim that the council should have been more transparent about Brook’s bid. The judge said this allegation was irrelevant because the trust had not been a bidder in the procurement.

The trust’s sexual health service was rated “good” by the Care Quality Commission in September last year, with “outstanding” elements, including placing first nationally in an audit of the delivery of emergency contraception. Between April 2017 and April 2018, the service treated nearly 20,000 patients.

The services will be taken over by Brook in “late 2019”, the council told HSJ.

A spokeswoman added: ”We are working with the current provider…and new provider…to ensure that people accessing the service in Cornwall continue to receive a high quality service for their sexual health. 

A spokeswoman for the trust said she could not comment for legal reasons. 

HSJ has approached Brook for comment.

The case comes a year after two other NHS trusts took a unitary authority to court over a procurement. In that event Lancashire Care Foundation Trust and Blackpool Teaching Hospitals FT successfully argued that Lancashire County Council had a run a flawed procurement when it awarded a children’s services deal to Virgin Care. However, a second procurement ordered by the court resulted in Virgin Care being awarded the contract regardless.