England and Wales High Court (Technology and Construction Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
TECHNOLOGY AND CONSTRUCTION COURT

		Royal Courts of Justice Strand, London, WC2A 2LL
		27 May 2016 Ex Tempore

Mr Justice Stuart-Smith :

Introduction

1. This is an application by the Defendants, who are the statutory bodies responsible for procuring NHS Services in North Kent to set aside the automatic suspension which arose as a result of the commencement of proceedings by the Claimant on 19 February 2016. I shall refer to the Defendants as the CCGs and to the Claimant as the Trust.
2. The Trust has been the provider of adult community services in North Kent for a number of years. In about 2013 a number of complaints caused the CCGs concern about the services being provided by the Trust. A "Remedial Action Plan" was issued in July 2014. On the materials that are available to the Court it appears that some improvements occurred, but the CCGs decided in May 2015 to go out to competitive tender for the procurement of the future provision of those services. Their intention was that the new arrangements should be in place by 1 April 2016.
3. On 13 May 2015 the CCGs published a Contract Notice in the Official Journal of the European Union which described the exercise as being for Part B services and said that the competitive dialogue process would be used. In June 2015 the Trust, as part of a consortium of bidders, submitted its Pre-Qualification Questionnaire ["PQQ"]. The purpose of the PQQ stage included that the CCGs should be able to and should assess the capability and suitability of potential bidders to provide the services. It included questions requiring potential bidders to outline their previous experience, their approach to clinical governance, quality management and patient safety, and to describe their arrangements for ensuring that all clinical staff receive appropriate clinical supervision and how good practice was to be achieved. The Trust was awarded 4 out of 5 for each of these areas, which means that its answers were assessed as "good".
4. The CCGs were evidently satisfied at the capability and suitability of the Trust to provide the services as disclosed by the PQQ exercise and they invited the Trust to participate in the competitive dialogue. The final date for tenders was 20 November 2015. On 22 December 2015 the CCGs informed the Trust that the contract was to be awarded to Virgin Care because Virgin Care's overall score was better than that of the Trust. The overall score had two component parts, quality and price. The Trust scored better than Virgin Care on quality but less well on price. It may therefore reasonably be deduced that the CCGs would have been content to award the contract to the Trust simply on grounds of quality; where the Trust fell short was on price.
5. The Trust issued these proceedings on 19 February 2016. There was then a relatively short period during which the CCGs gave limited disclosure, which they hoped might persuade the Trust to withdraw its claim. That did not happen. On 13 April 2016 the CCGs' solicitors wrote requesting the Trust to consent to the lifting of the automatic suspension "in the urgent interests of the development of adult community services and the promotion of patient care in North Kent." On 22 April 2016 the Trust's solicitors informed the CCGs that the Trust did not consent to the lifting of the suspension and that it would strongly resist any application that was made. After a time spent preparing the extensive evidence in support, the present application to lift the automatic suspension was issued on 10 May 2016. The Defence was served on 19 May 2016. The application to set aside was heard yesterday, 26 May 2016. There was a suggestion in the Trust's submissions that the CCGs had delayed unreasonably in issuing their application. I do not agree.
6. The application has generated over 2000 pages of pleadings, witness statements and exhibits but the issues between the parties can be shortly stated:

i) The principles to be applied are generally both settled and well known and involve the application of American Cyanamid principles in the context of the statutory framework for the regulation of public procurement contracts. I shall refer to them in more detail below;

ii) It is accepted that the proceedings brought by the Trust raise a serious issue to be tried. The Trust says that it has a strong case. That may be so, but on an application such as this the material does not make it one of those cases where the Court can take the view that one party or another is bound to win. I therefore approach the case on the agreed basis that the first American Cyanamid requirement is satisfied;

iii) The Trust contends that damages would not be an adequate remedy for it as a not-for-profit organisation which exists to serve the public good. This raises interesting questions of principle and application which I will have to examine in some detail;

iv) The CCGs say that damages would be an adequate remedy for the Trust but would not be an adequate remedy for the CCGs for a number of reasons. At the forefront of those reasons are a number of stated concerns about the quality of the provision of services by the Trust. The Trust says that there is a short answer to those stated concerns, which is that it scored more highly on quality than did Virgin Care;

v) The CCGs say that the balance of convenience favours the lifting of the suspension and that a substantial consideration for the Court is the public interest in the NHS being allowed to get on with the provision of care services as it thinks best.

7. This is not an exhaustive account of the arguments that have been advanced on either side. It is, however, sufficient to show that at various stages in the argument each of these limbs of the National Health Service asserts that public interest is on its side.

The Principles to be Applied

8. I have described the principles as generally settled and well known. There are a number of contributing authorities. If only because Carr J in Counted4 Community Interest Company v Sunderland City Council [2015] EWHC 3898 (TCC) described it as a helpful overview, I adopt what I said in Openview Security Solutions Limited v London Borough of Merton Council [2015] EWHC 3332 (TCC) at [6]-[40], while having regard to the other authorities that now make up the usual body to be referred to the court on applications such as this..
9. Each case is likely to have particular factual nuances that will cause the court to concentrate upon different aspects of the general principles. In the present case, attention has focussed on what is meant by the adequacy of damages for a not-for-profit organisation and on the role of the public interest in assessing the balance of convenience.

Damages as an adequate remedy

10. In the present case the CCGs submit that damages are an adequate remedy because the financial loss to the Trust if it is wrongfully deprived of the contract can be calculated. Thus it is said that the fact that the Trust aims to generate a surplus of over 1% on its activities and has historically done so and that the annual intended contribution of the contract to the Trust's fixed overheads means that damages can be calculated without difficulty. There is no suggestion that losing the contract will put the Trust out of business, and no real question of loss of reputation arises. The Joint Trust and CCG Impact Assessment Report does not identify interdependencies and so, say the CCGs, it can be taken that there will be no knock on effects for the Trust's other activities or, if there are, they are not material and simply reflect the Trust's wish to maintain its monopoly position.
11. The Trust identifies three reasons why the answer "No" should be given to the question "Is it just, in all the circumstances, that a plaintiff should be confined to its remedy in damages?"

i) The Trust submits that the question is to be answered by reference to a Claimants' real concern in bringing the proceedings, so as to meet the substantial justice of the case if the claim succeeds. Here, it is submitted that the Trust is a public body that exists solely to care for and provide healthcare services to the people of Kent. It asserts that its true interest in pursuing this litigation is the protection of the public good. It submits that NHS procurement cannot be treated as if it were simply an ordinary commercial exercise and that the overarching statutory duty of an NHS body procuring services is to act with a view to securing the needs of the people who use the services, improving the quality of the services and improving efficiency in the provision of the services, including through their provision in an integrated way which "cannot be reduced to a lowest common denominator of financial returns, or damages representing such returns." It seeks to turn its not-for-profit status to its advantage by submitting that it "exists for the sole purpose of providing NHS Healthcare services to its patients";

ii) Second, it submits on the basis of evidence from Mr Flack, its executive director, that the Trust attempts to provide an integrated approach to healthcare services for the people of North Kent, which he says will be undermined if the contract goes to Virgin Care. It submits that "the prejudice that [the Trust's] public service mission would suffer …, and the impact on the interests of [the Trust's] patients, is not a matter that can be compensated for adequately or at all by an award of damages";

iii) Third, it submits that if the suspension were lifted it would lose approximately 10% of all its operations by turnover, which would in turn impact upon its ability to achieve economies of scale and so would require financial savings to be made elsewhere, with an impact on patient care.

12. In support of its submission on the inadequacy of damages as a remedy, the Trust recognises that in Solent NHS Trust v Hampshire CC [2015] EWHC 457 (TCC) Akenhead J held that damages were an adequate remedy for the Claimant even though it was a not for profit organisation; but it submits that there is no sign of the points it raises on this application being raised before the judge in that case. Conversely, in Bristol Missing Link Ltd v Bristol City Council [2015] PTSR 1470 Coulson J held that damages would not be an adequate remedy for a not-for-profit organisation in circumstances where the loss of the contract would have a catastrophic effect on BMLL's ability to provide its existing services for vulnerable women in Bristol and lifting the suspension would have a significant effect upon its reputation because of its consequential inability to continue its work. The high-point for the Trust is Coulson J's apparently general statement in the light of the fact that BMLL would recover minimal damages that "In my view, a non-profit-making organisation, which has bid for a contract making no allowance for profit at all, and a minimal amount for overheads, is entitled to say that, in such circumstances, damages would not be an adequate remedy.": see [55]. He then went on to consider the additional features of the case, to which I have referred, which contributed to his decision that damages were not an adequate remedy in that case.
13. In the Solent NHS Trust Case, the Claimant was a substantial organisation. The contract was for the provision of integrated adult substance misuse recovery services. The Claimant claimed its lost profits on the anticipated contract, which were said to be identifiable from the terms of its tender. It alleged that damages would not be an adequate remedy on two grounds that Akenhead J rejected as not established, namely that the Claimant would have to transfer various employees to the new provider and that economies of scale would be lost so that the viability of other projects would be cast into doubt. I agree that there is no reference to any submission that the quantum of recovery of damages should of itself be a reason for holding that damages would not be an adequate remedy. Similarly, in the Counted4 Community Interest Company case, there is no sign that any submission was made to Carr J that the fact that the Claimant was a not for profit organisation meant that (or was a reason that supported a submission that) damages would be an inadequate remedy. To the contrary, it appears from [40] of Carr J's judgment that no such submission was made or pressed: the gravamen of the Claimant's case was that, if the suspension was lifted, it would lose its highly and uniquely trained workforce.
14. Looking further afield, the Trust relies on high authority of more general application to the granting or withholding of injunctions:

i) In AB v CD [2015] 1 WLR 771 the Court of Appeal reversed my decision not to grant an interim injunction in circumstances where the damages that would otherwise have been recoverable as a remedy were reduced by a limitation of damages clause in the contract between the parties. Laws LJ said, at [27] that "the rule – if "rule" is the right word – that an injunction should not be granted where damages would be an adequate remedy should be applied in a way which reflects the substantial justice of the situation";

ii) More recently, in PJS v News Group Newspapers [2016] UKSC 26 the Supreme Court held that damages would not be an adequate remedy where what was at stake, and what the Claimant was trying to protect, was his privacy. The point was encapsulated by Lord Mance at [43]:

"In any event, whether or not substantial or even exemplary damages could be recovered in the present case is not decisive of the question whether an interim injunction should be granted. Once again, it is necessary to consider the particular facts. Here, it is highly likely, having regard to the nature of the material sought to be published and the identity and financial circumstances of the appellant, that the appellant's real concern is indeed with the invasion of privacy that would be involved in further disclosure and publication in the English media, and that any award of damages, however assessed, would be an inadequate remedy."

15. I accept and adopt the principle that, as exemplified in PJS, there may be cases where the infringement of the interest that a party is trying to protect by way of an injunction may not be adequately compensated by an award of damages. A person's privacy or reputation seems to me to be the paradigm example of such a case, which is confirmed by the decision of the Supreme Court in PJS itself. I also accept and adopt the principle that there may be other considerations which lead to the conclusion that the Claimant in a particular case may not be adequately compensated by an award of damages because an award of damages does not reflect the substantial justice of the case. AB v CD was such a case. In the absence of the limitation of damages clause, damages could and would have been a full and adequate remedy; but "an agreement to restrict the recoverability of damages in the event of a breach cannot be treated as an agreement to excuse performance of [the] primary [contractual] obligation": see per Underhill LJ at [27].
16. However, what both AB v CD and PJS have in common is the Court's focus on the interests of the Claimant. Thus in AB v CD, injunctive relief was appropriate because the Claimant would lose more money than it could recover by way of an action for damages. In those circumstances, as Ryder LJ made explicit at [32], the answer to the question first posed by Sachs LJ in Evans Marshall – "is it just in all the circumstances that a [claimant] be confined to his remedy in damages?" – was "No". In PJS the real interest of the Claimant was to protect his privacy, loss of which the Supreme Court held, could not be properly compensated in damages.
17. It seems to me to be right in principle that the question of adequacy of damages should be answered by reference to the interests of the person seeking the injunctive relief. I therefore respectfully question whether the breadth of Coulson J's statement at paragraph [55] of BMLL is justified. I consider it to be right in principle that the mere fact that the Claimants were not-for-profit organisations in the Solent NHS Trust Case and the Counted4 Community Interest Case were not advanced as reasons why damages were not an adequate remedy. I can see no reason why damages should be regarded as an inadequate remedy simply because the Claimant, whether as a not-for-profit organisation or for other reasons, has not suffered and will not suffer substantial financial loss.
18. That said, I am respectfully in full agreement with Coulson J that the additional factors in the BMLL Case, which I have summarised above, were capable of being good reason for holding that damages were an inadequate remedy in the circumstances of that case. The substantial justice of that case had to reflect the fact that, although their immediate and recoverable financial losses would be modest, the knock on effects (which, at least arguably, would not be compensated in damages) would be catastrophic. Similarly, in the Solent NHS Trust Case, if it had been established that the knock on effects would have been as suggested by the Claimant, that could have created a real interest that could not be properly compensated so as to meet the substantial justice of the case. It was real interests of that kind that persuaded Carr J in the Counted4 Community Interest Case that damages would not be an adequate remedy: see [40].
19. Turning to the three reasons advanced by Trust in this case, while I do not suggest that they are irrelevant to the question of the balance of convenience (to which I will return) I do not consider that they could as formulated lead to a conclusion that damages would not be an adequate remedy for the Trust:

i) For the purposes of this submission I accept the Trust's formulations that it is "a public body that exists solely to care for and provide healthcare services to the people of Kent" and "a public body that exists for the sole purpose of providing NHS Healthcare services to its patients". As the organisational structures of the NHS and the existence of the regime which permits procurement of services from other types of body or organisation makes clear, this cannot and does not give the Trust a monopoly or the right to primacy or priority in the context of NHS procurement. Nor does it determine whether or not damages would be an adequate remedy. Once it is accepted that the procurement regime being adopted in this case was meant to create a level playing field and complete equality of opportunity as between the Trust and Virgin Care, there can be no justification for approaching the question of adequacy of damages any differently depending upon whether it is the Trust or Virgin Care that is the disappointed bidder. In purely financial terms, the losses that would be incurred if the Trust fails to win the contract can be assessed without obvious difficulty and can be made the subject of an appropriate award of damages;

ii) The Trust's second submission is that patients may suffer because the provision of services to the people of North Kent will not be fully integrated if the contract goes to Virgin Care. The submission is expressly made by reference to the interests of the Trust's patients: see the Trust's skeleton at [35]. Although it is said that the Trust's "public service mission would suffer [prejudice] as a result" this is in truth another way of saying that the new arrangements will not serve the interests of patients as well as would be the case if the Trust gets the contract. It is not seriously suggested that the Trust will lose reputation as referred to in some other cases: it is therefore not necessary for me to return to that issue in detail;

iii) The third submission is essentially a repeat of the second. It is that the Trust will lose 10% of its turnover and will no longer be providing an integrated service to the whole of the community it exists to serve. It is said that this would require economies of scale and savings elsewhere, but the end-point of the submission is that this will impact on patient care i.e. the interests of patients. This is not even remotely analogous to the catastrophic impact on BMLL of the loss of the contract in that case, which would effectively have obliterated its ability to function at all; nor is it comparable with the substantial difficulties, advanced by the disappointed bidder but rejected on the facts by Akenhead J, in the Solent NHS Trust Case.

20. I note that in another case involving an NHS Trust as the disappointed bidder trying to maintain the automatic suspension, Tugendhat J noted that much of the NHS Trust's evidence that was supposed to go to the question of adequacy of damages was in fact about concerns for the delivery of the service to the population in need of it: see The Newcastle Upon Tyne Hospital NHS Foundation Trust v Newcastle Primary Care Trust and Others [2012] EWHC 2093 (QB) at [36]. Tugendhat J dealt with the question of adequacy of damages concisely at [37] as follows:

"The fact remains, that little is said for the claimant to explain whether, and if so why, damages would not be an adequate remedy to it in its capacity as the economic operator, which is the capacity in which its use. I accept that if the claimant is not awarded this contract, it will not only suffer direct lots, but it may also suffer an indirect effect in its ability to win or perform other contracts, and in the maintenance of its existing structures."

21. That approach seems to me to be at least consistent with the approach that I would adopt in this case and which was adopted in the Solent NHS Trust Case and the Counted4 Community Interest Company Case by Akenhead J and Carr J respectively.
22. Mr Giffin QC's ultimate formulation of his submission was that the question of adequacy of damages is whether it is just in all the circumstances to confine a claimant to a damages remedy. He submits that it is not doing substantial justice to a claimant who is not engaging in the procurement process to generate money if the Court says that all the Claimant can recover is money. If, as he submits is the case here, the Claimant engages in the procurement because, in its judgment and belief as a public benefit corporation, a single provider of services across Kent is for the public benefit then simply to award damages for financial losses fails to meet that C's real concerns, because the Court is giving it a remedy that is essentially irrelevant to its wider purpose.
23. To my mind there is ultimately a short answer to this submission, which is that the Court is never going to rule on the question whether the public benefit is better served by having one provider of integrated services or more than one. All that it will rule on is whether the procurement process was flawed and, if so, what are the consequences. Not only will the court not rule on the question of the relative public interest in different forms of provision, it could not possibly do so. The impossibility of trying to do so is illustrated by the fact that the current NHS Structures have been deliberately set up by decisions that are not to be reviewed by the Court in these proceedings; and from the fact that the Trust and the CCGs are both public bodies having the same objectives of providing the best possible health care services to the people of Kent and yet they hold diametrically opposed views as to what is in the public interest. The Court can resolve the dispute before it; but it cannot and will not attempt to form or express a view about the comparative merits of the services that are the subject of this procurement exercise being provided by the Trust as part of an integrated provision of wider services or by Virgin as a separate provider.
24. For these reasons, I would hold that the arguments put forward by the Trust in support of the submission that damages would be an inadequate remedy are not relevant to that issue. They may, however, be given appropriate weight when considering the public interest and the overall balance of convenience.

The Role of the Public Interest in the Balance of Convenience

25. It is well established that the public interest may be a relevant consideration when considering the balance of convenience. That this may be so is clear from the decision of Vos J in Alstom Transport v Eurostar Limited [2010] EWHC 2747 (Ch) and Leggatt J in Edenred (UK Group) HM Treasury and Ors [2014] EWHC 3555 (QB) : and see generally [16]-[27] of my judgment in Openview.
26. I agree with the observation of Akenhead J in Exel Europe Ltd v University Hospitals Coventry and Warwickshire NHS Trust [2010] EWHC 3332 (TCC) at [45] that:

"In my judgement, one important area of the public interest is the efficient and economic running of the National Health Service. In these times of economic difficulties and constraints, there is massive pressure on the different arms and parts of the NHS to make savings. One main area is and must be the procurement of medical goods, drugs, equipment and services. It is not for the court however to determine how the different parts of the NHS must achieve efficient and cost saving procurement."

It is certainly not for the Court to second-guess the CCG's decision to put the services out for procurement. Once they chose to do so, there were two obvious public interests in play. The first is that the procurement exercise should be conducted fairly. The second is that the CCGs should be able to put the arrangements which they consider to be in the public interest into effect promptly.

27. The present case seems to me to be a good example of one where the Court should exercise caution for the reasons I outlined at [27] of Openview. In circumstances where I can make no assumptions about the eventual outcome of the Trust's challenge, lifting the suspension may have two consequences that bear on the issue of the public interest. First, the CCGs would be required to continue working with the Trust in place of their chosen provider; and, second, the delay that will be caused even by an expedited trial and assuming no appeal is likely to mean that the arrangements under the new contract will not be put in place and mobilised in August/September 2016, ready for this winter, but will be put off to a date which will, for good logistical reasons, have to be after the winter's heavy demand has been met. Whichever of the service providers is eventually installed, that is an undesirable delay.

Application of Principles to the Facts of this Case

28. It is common ground that there is a serious issue to be tried. By reference to confidential information, Mr Giffin QC for the Trust showed me what he described as an indicative example of the strength of the Trust's case that the marking had gone wrong. At present, that case has not been answered and, on what I have been shown, Mr Giffin's criticisms seem valid. However, in applying American Cyanamid principles, he accepts that the Court cannot adjust the weight to be applied to the nature of the issues to be tried to reflect what appear to be gradations of strength of the Claimants' case. Once it is accepted that there is a serious issue to be tried, the first hurdle is passed. Unless the Court can form the view, without conducting any form of mini-trial, that the claimant is virtually bound to succeed, the case remains classified as one where there is a serious issue to be tried. It is both unsafe and wrong (in principle and on authority) to attempt to calibrate the exercise of the Court's discretion by reference to an assessment of the strength of the Claimant's case as lying somewhere between the two points of there being a serious issue to be tried and being virtually certain of the Claimant's ultimate success. On the information available to this court, I am not able to form a reliable view that the Claimant is anywhere near to being virtually certain of success. I therefore treat the case simply as one where it is common ground that there is a serious issue to be tried.
29. I am not satisfied that damages would be an inadequate remedy for the Trust. Assuming it wins at a trial of the action, its financial losses may be readily quantified and fully compensated. As I have indicated, the Court will not investigate or decide the question whether the Trust is right in its belief that the interests of the people of Kent will be better served by having it as the sole provider of the services or by fragmenting the provision of services in the way that the appointment of Virgin Care would necessarily entail. For the reasons I have given, the Trust's belief that it would be acting in the public interest by having conduct of the provision of these services does not give it a right such as the right of privacy of an individual as in PJS; nor does it give its engagement in the procurement process a substantive legal purpose that the Court will recognise as being entitled to substantive protection as in PJS or as in AB v CD.
30. I have taken into account the evidence of Mr Flack, The Trust's executive director. He addresses the question of adequacy of damages at [63]ff of his witness statement. In addition to his evidence about the Trust's purpose and motivation, he mentions discrete topics of concern at [86] ff. For the most part, he continues to concentrate upon the potential impact upon patients. Where he does refer to operational difficulties that may be experienced by the Trust if it fails to obtain the contract his evidence is markedly vague and falls well short of establishing the prospect of real losses that the law should protect and which cannot be compensated by an award of damages. I am not persuaded that the impact of those difficulties are ones that should lead to a conclusion that damages would be an inadequate remedy or that confining the Trust to a remedy in damages would give rise to a significant risk of injustice.
31. Conversely, there is at least a significant risk that an award of damages would not be an adequate remedy for the CCGs if the automatic suspension is terminated. Where the Trust's financial losses can be assessed relatively easily by reference to its contractual build-up, the losses that may be suffered by the CCGs, though potentially real, are more difficult to define and quantify. The immediate impact of not terminating the suspension will be that the CCGs have to continue with the Trust as provider of the services. Although in the context of the procurement exercise the Trust has been assessed as being suitable to provide an adequate quality of services, the CCGs have continuing concerns about the manner in which the services are being provided at present and it is apparent from the responsive evidence of Ms Strong, the Deputy Chief Executive of the Trust, that the Trust is continuing to experience difficulties that cannot be described as insignificant. Those difficulties include difficulties in providing accurate data when reporting to the CCGs, and in recruiting and retaining suitable levels of staff: see [28]-[62] of Ms Strong's witness statement. The impact of those difficulties is likely to be real, but it would be exceptionally difficult to assess in monetary terms. There is the further difficulty that the Trust would almost certainly raise, namely that either similar or different difficulties might arise in the early days of the proposed contract with Virgin Care, which should be taken into account when attempting to resolve whether or not the CCGs are better or worse off. The Court will not be deterred by difficulty as such; but it may be deterred if, however hard it tries, it will not be possible to assess the financial impact reliably.
32. I am not in a position to conclude that damages would be an inadequate remedy for the CCGs; but I can and do conclude that there is a risk that they would be.
33. On the proper application of American Cyanamid principles, a conclusion that damages would be an adequate remedy for the Trust means that an application for an interim injunction should usually be refused, however strong the Claimant's case may appear to be.
34. The Trust submits that, even if damages are an adequate remedy for it, the Court should go on and consider the balance of convenience and that, in doing so the Court must have regard to the likely length of duration of any suspension. The second part of this submission is based upon [50] of the decision of the Court of Appeal in DWF LLP v Secretary of State for Business Innovation and Skills [2014] EWCA Civ 900. I am not convinced that is what the Court of Appeal either said or meant in the context of Sir Robin Jacob's judgment, but I am content to assume for present purposes that it is.
35. The TCC in London may be able to list this trial of this action for four days at the end of July 2016. The Trust has made enquiries and has been informed that the TCC in Manchester could hear the trial either one or two weeks earlier. The parties and their witnesses come from the South East of England. All counsel are London based. One firm of solicitors (Capsticks) is based in London; the other is based in Bristol (Bevan Brittan). Mr Giffin QC appeared to contemplate the increased cost of hearing such a case in Manchester rather than London with an equanimity that does not sit easily with the Trust's reasonably expressed concerns about the costs of the present exercise for the NHS as a whole. While I accept that the incremental costs may be a small proportion of the public money that the parties are contemplating should be spent on this litigation in any event, that reflects the projected costs of the litigation as a whole rather than the incremental costs of holding the trial in Manchester.
36. I have said in the context of other procurement cases that the Court's willingness to allocate substantial resources at short notice may carry with it a requirement that the parties must submit themselves to exorbitant effort to bring cases on promptly. Even so, it seems to me that to bring this case to trial before the end of July would be a tall order, though not necessarily impossible. There are outstanding issues of disclosure. It is highly likely that further disclosure may lead to further amendments on both sides. Despite (and partially because of) the weight of evidence already produced, focussed evidence for trial would have to be prepared, exchanged, considered and responded to as necessary. I am not convinced that this case would be brought to trial in good triable order before the very end of July.
37. At first blush, a time to trial of 6-8 weeks may not seem much delay for the CCGs. But they have evidenced a reasonable concern that they wish to have their new contractual arrangements in place before the winter (because of the additional demands upon the NHS that winter brings) and that they do not want to be in the process of mobilising or "bedding down" their new arrangements as winter comes on. Even assuming that the Court were able not merely to hear the case but to provide a judgment within a short time thereafter, there is a real risk that the delay will make the difference between getting the new arrangements in place in time for this winter and being unable to do so. From the CCGs' perspective, the least bad outcome would be that they won at trial and the Trust accepted the judgment without taking matters further. Even if that happened, mobilisation for this winter would be at risk. It is also only realistic to point out that there is nothing in the conduct of the case so far to give assurance that the Trust would not seek to challenge an adverse decision. If the CCGs were to lose at trial, their entire timetable would be thrown out of kilter, although it can reasonably be said that in that event they have only themselves to blame.
38. I do not ignore or underestimate the public interest in procurement exercises being conducted lawfully. But the likely knock-on effect of even a modest delay in resolving this case at trial must be brought into account as a significant counter-balance since it will prevent the efficient and timely introduction of the arrangements which the CCGs consider to be in the best interest of the people of Kent for whose welfare they too are responsible. As I have indicated, the public interest of the people of Kent is in principle a material factor that may affect the balance of convenience in an appropriate case. But here, the Court is confronted by two limbs of the NHS, each having the same responsibilities and commitment to the public good and the efficient provision of healthcare services, and they take diametrically opposed views on what is in the public interest in the circumstances now prevailing. I am not in a position to conclude that the public interest would be better served by the Trust being the provider of these services or Virgin Care. I am therefore not in a position to bring the public interest arguments relied into account as a significant weight on one side or another when assessing the balance of convenience.
39. That leaves, on the Trust's case, the risk that the CCGs will have to pay twice, once to Virgin Care for the provision of the services and once to the Trust as damages. That is a material consideration but it is tempered by the fact that I can only regard the Trust's case as raising serious issues for trial and by the Trust's concerns that any damages it will recover will be modest.
40. For these reasons, I do not consider that the balance of convenience can be seen to weigh substantially in favour of maintaining or not maintaining the automatic suspension. In American Cyanamid terms, the factors are fairly evenly balanced. Therefore, even if it were to be concluded that damages were not an adequate remedy for the Trust, it is a counsel of prudence to maintain the status quo. The parties were not able to agree what is the status quo for these purposes. The Trust submits that the status quo is that it is in place providing services. The CCGs point out that the Trust's contract to provide the services expired on and from 1 April 2016 and that, unless injuncted from doing so, the status quo would allow it to enter into the contract with Virgin Care rather than being compelled to continue dealing with the Trust under a temporary extension of the previous arrangements. That is an accurate description of the present state of affairs which I accept. The terms of Regulation 47H(2)(a) require the Court to consider the CCGs' application as if Regulation 47G(1) were not applicable. If Regulation 47(G)(1) were not applicable, no question of the Trust continuing to be providing circumstances after 1 April 2016 would have arisen. Therefore, if a notional American Cyanamid exercise had been conducted before that date, the status quo would have included that (unless injuncted) the CCGs were and would be free to contract with Virgin Care for the provision of the services after 1 April; and if the exercise had been conducted after 1 April 2016, Virgin Care would have been in place.
41. For these reasons, if I follow the classic American Cyanamid path, I conclude that damages would be an adequate remedy, the balance of convenience is not shown to support the granting of an injunction, and the status quo favours not granting one. If I approach the question on a more unitary, or rolled-up basis, by asking the aggregate question "is it just in all the circumstances that the Trust should be confined to its remedy in damages?", my answer is that it is.