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Essential reading for tender evaluators

Monday, September 26, 2016

Energy Solutions EU Ltd v Nuclear Decommissioning Authority [2016] EWHC 1988 (TCC) (29 July 2016)

On 29th July 2016, this much anticipated judgment in the UK was handed down. This judgment casts the spotlight, once again, on the record keeping obligations on contracting authorities which had arisen in the RPS judgment [1], in Woods Building Services v Milton Keynes Council[2] and is now reinforced by its explicit reference at Regulation 84 of the Public Contract Regulations 2016[3]. This extraordinarily comprehensive judgment that stretches to 324 pages, sets out some very useful guidance on the standard expected of contracting authorities when conducting evaluations.



This case concerned a challenge taken by ES Energy Solutions (“ES”) who were part of a consortium (“RSS”) who submitted a bid for a major contract for the clean-up of 12 nuclear sites in the UK. RSS lost by a marginal 1.06% to Cavendish Fluor Partnership (“CFP”). ES challenged the outcome of the evaluation process and were seeking damages from the National Decommissioning Authority (“NDA”). Their challenge centered on the following arguments:

  • There had been manifest errors in the evaluation process and on that basis RSS should have been awarded the contract;
  • The scores given to CFP’s bid were not supported by the comments of the individual evaluators in the evaluation reports;
  • The NDA had amended scores of the two bids (RSS and CFP) without justification and had not acted properly in considering the pass/fail thresholds; and
  • CFP had failed to properly provide relevant information within its bid so the correct outcome should have been an evaluation by the NDA that resulted in “below threshold” or “fail” in respect of some parts of CFP’s bid (which would have led to CFP being excluded).


Key points

The key points from this judgment which should be considered by contracting authorities conducting evaluations are:


  • Manifest error in the evaluation process

Manifest error is not confined to whether the score ultimately awarded was correct. The judge made clear that in determining whether there had been manifest error it was necessary to consider the application of the tender criteria, the scoring process and the score.


  • “Fudging” of the scoring process to avoid exclusion of a bidder

If a bidder fails to meet pass/fail thresholds, the evaluation process should not be manipulated to accommodate a bidder to avoid this bidder’s automatic exclusion. The judge made it clear “the rules cannot be changed after the competition has started and the tenders submitted”.


  • Evaluation process must be in compliance with the general principle of transparency

In the event that the evaluation team concludes that the terms of a particular minimum requirement are not met and decide to seek advice from a more senior member of the contracting authority, ensure that these conversations are recorded and notes are taken. The judge adopted a hardline on this point and in considering the particular case before him stated that “he [the Head of the competition] made sure matters were recorded when it suited him but was also perfectly happy to conduct unrecorded, though very important, conversations which led to the evaluation team changing scores or deciding on threshold issues knowing they were not recorded”. “Because of this, very important aspects of the evaluation process were wholly lacking in transparency, in breach of the obligation of transparency upon the NDA.”


  • Minimising written records is not consistent with the duty of transparency

The judge noted that the Head of the competition was not particularly enthusiastic about the evaluation team recording their own views during the evaluation. The court held that “given the obligation upon the NDA to perform the evaluation transparently, such evidence from the Head of the department was “most disappointing”. The judge found that there was at the very least strong discouragement of the evaluation team taking comprehensive notes, and the Head himself gave evidence that “not to record notes as a rule”. The judge stated that this “can hardly have helped a process that is required to be transparent, and it can hardly have helped such a complicated factual evaluation of the tender submissions either”.


Of further concern was the fact that there had been references in the training material to the shredding of notes, and the general ethos of restricting note taking by the evaluation team were part of this approach. The judge came to the conclusion that the head was acutely aware of the difficult issues that arose during the evaluation process such as the potential disqualification of CFP. The judge stated that the solution they adopted was to try and navigate a way around such issues, to avoid scrutiny being brought to bear upon the evaluation and to put the NDA in a position that could be more easily defended in the event of a procurement challenge.


Finally the judge was highly critical of the limited use of the evaluation database and stated in “Many instances they [the notes] are extraordinary brief”. Furthermore, she stated “There is nothing inherently wrong with using “cut and paste”, in some circumstances….however, it does have some inherent risks in that if an error has been made initially that led to the first iteration of the text being produced, without separate consideration that same error can creep into each subsequent “cut and paste” entry”.


  • Changing scores after scoring has closed as a result of unrecorded conversations

In relation to the evaluation database, the judge said do not change scores after the evaluation has been completed. In this case, a member of the team changed scores and sought agreement of the other evaluators to the changes post their decision. On numerous occasions, the court was told by different witnesses that changes were made to the scoring and/or rationale following unrecorded conversations with the head. One situation in which the judge was extremely concerned about was the decision on whether to evaluate the CFP Tender Submission which had failed a pass or fail requirement, which could have resulted in the whole CFP’s bid being disqualified. The judge stated that “This decision was conducted “off stage”,orally and does not appear to be recorded in any way whatsoever”.


  • Law Firm’s Legal Review

NDA had engaged lawyers to review the scoring process. This involved a legal review of the requests for clarifications that had been raised by the evaluation team, scores and consensus comments of selected requirements for all of the evaluation steps. While the documents were subject to professional legal privilege and the judge found no issue with this, however, it did mean that in some instances, there was an omission in the chain of decision making that led to the claimant’s tender being given the particular score it was awarded.




The judge held that:

  • there were manifest errors by the NDA ‘s evaluation team in the evaluation of the claimants tender with the result that the RSS score is, as a result of this judgment, to be increased;
  • on some requirements RSS were treated quite differently and less advantageous than CFP;
  • CFP should have been disqualified from the competition on the basis that they failed to meet the prescribed minimum requirements;
  • the NDA sought to avoid the consequences of disqualification by “fudging”, the evaluation of those requirements to avoid reaching a situation where CFP would be given a “Fail” or “Below Threshold” score;
  • in four instances the CFP score should be reduced because the score awarded by the evaluation team was manifestly erroneous; and
  • the consequences of this change of score upon the percentage resulting of the tender have been agreed by the parties. After the appropriate weighting is applied to the new scores, the results of the procurement competition as adjusted result in RSS being the most economically advantageous tenderer.



This is a highly significant judgment and will prove as a useful guidance for contracting authorities when deciding how to structure their evaluation process and how to approach record keeping going forward. It is a further example of the scrutiny being carried out by the courts of tender evaluation processes. This, together with the more detailed obligations on contracting authorities under Article 84 of the new Directive[4] must be at the forefront of the minds of those carrying out tender evaluations.




[1] RPS Consulting Engineers Ltd. v Kildare County Council & Ors. [2016] IEHC 113

[2] Woods Building Services v Milton Keynes Council [2015] EWHC 2011 (TCC)

[3] S.I. No. 284 of 2016 European Union (Award of Public Authority Contracts) Regulations 2016

[4] Directive 2014/24EU


Kerri Crossen