High Court of Ireland Decisions

1. By Order of this Court made by Keane J. on 13th October, 1993, the Applicant was granted leave to apply for, inter alia, the following reliefs by way of application for judicial review, namely:-

2. That Order was made pursuant to an application under Order 84, Rule 20 of the Rules of the Superior Courts, 1986, which invoked the normal judicial review jurisdiction of this Court. Leave was granted to apply for, inter alia, the foregoing the reliefs on the following grounds, namely:-

3. On 23rd December, 1993, the Applicant, as Plaintiff, instituted proceedings by way of Special Summons in this Court against the Respondent, as Defendant (Record No. 1993 No. 913 Sp), invoking the jurisdiction conferred on this Court by the European Communities (Review Procedures for the Award of Public Supply and Public Works Contracts) Regulations, 1992 (S.I. No. 38 of 1992) claiming a review of the decisions of the Respondent to reject the Applicant's tender and award the contract for the Works to Mulcair and, in particular, claiming, inter alia, declarations in broadly similar terms to the declarations sought in the judicial review proceedings and an order awarding the Applicant damages against the Respondent by reason of its infringement of the said Directives and Regulations.

4. Both proceedings were listed for hearing and were heard together and this judgment relates to both proceedings, to which I will refer collectively as "these proceedings".

5. Council Directive 71/305/EEC (the 1971 Directive) was part of an extensive regulatory regime regulating public procurement in the European Community. As is clear from its recitals, its purpose was the co-ordination of national procedures for the award of public works contracts, which was seen as necessary, along with the abolition of restrictions, to attain the objective of freedom of establishment and freedom to provide services in respect of public works contracts awarded within the Community. The 1971 Directive was amended from time to time and the amending Directive which is relevant for present purposes is Council Directive 89/440/EEC (the 1989 Directive). The combined effect of the 1971 Directive and the Directives amending it, including the 1989 Directive, was to put in place a complex body of rules governing the award of public works contracts to which they apply. It is necessary only to refer to the provisions which were in force in 1992 and 1993 and are germane to the issues between the parties. Common advertising rules were stipulated in Title III which required publication of a contract notice, drawn up in accordance with the relevant prescribed model in the 1989 Directive, in the Official Journal of the European Communities. Title IV contained common rules on participation and Chapter II stipulated the criteria for the award of contracts. Article 29 provided as follows:-

6. Article 8 of the 1989 Directive inserted a general provision requiring a contracting authority, within 15 days of the receipt of a request from an eliminated tenderer, to inform him of the reasons for the rejection of his tender and the name of the successful tenderer.

7. The 1971 Directive and subsequent amendments thereof are now consolidated in Council Directive 93/37/EEC.

8. The 1971 Directive, as amended, did not contain any specific provisions for ensuring its effective application, as is recited in Council Directive 89/665/EEC (the Remedies Directive), the purpose of which was to supply that lacuna and provide effective and rapid remedies within Member States for infringements of Community law in the field of public procurement and of national rules implementing that law. Article 1 of the Remedies Directive mandates Member States, as regards contract award procedures falling within the scope of the 1971 Directive, as amended, to -

9. Article 2.1 mandates Member States to ensure that measures taken concerning the review procedures specified in Article 1 include provision for the powers to:

10. Article 2.7 mandates Member States to ensure that the decisions taken by review bodies can be effectively enforced.

11. The 1971 Directive and the 1989 Directive have been given effect to in the State by the European Communities (Award of Public Works Contracts) Regulations, 1992 (S.I. No. 36 of the 1992) (the 1992 Regulations). Article 4 of the 1992 Regulations provides as follows:-

12. None of the other Articles of the 1992 Regulations are germane to the issues which arise between the parties.

13. The Remedies Directive has been given effect to in the State by the European Communities (Review Procedures for the Award of Public Supply and Public Works Contracts) Regulations, 1992 (S.I. No. 38 of the 1992) (the Remedies Regulations). Article 3 of the Remedies Regulations provides that decisions taken by contracting authorities as regards contract award procedures falling within the scope of the 1971 Directive shall be reviewed in accordance with the conditions set out in the Remedies Directive. Article 4 provides that the review procedures referred to in the Remedies Directive and the powers provided in Article 2.1(a) to (c) of the Remedies Directive, which are summarised above, shall be carried out and exercised by the High Court. Articles 6 and 7 empower the High Court to grant certain specified reliefs in a situation where "a contract has been concluded subsequent to its award". Article 8 provides that an application under the provisions of the Remedies Regulations and the Remedies Directives may be brought in a summary manner.

14. There were no rules of court in force governing the procedure for seeking review by this Court under the Remedies Regulations when these proceedings were initiated by the Applicant. It was on this account that the Applicant took the precaution of instituting the proceedings by way of Special Summons as well as the judicial review proceedings.

15. On 14th February, 1992, the Respondent advertised in the national newspapers in this jurisdiction inviting tenders from civil engineering contractors for the carrying out of civil engineering works required for the construction of the Works. The advertisement stipulated that the lowest or any tender need not necessarily be accepted and the acceptance of any tender would be subject to the sanction of the Minister for the Environment. On 20th February, 1992, a contract notice in respect of the Works was published in the Official Journal of the European Communities and the notice was in conformity with Model B (Open Procedures) contained in Annex IV to the 1989 Directive. Paragraph 13 of the contract notice was in the following terms:-

16. Patrick J. Tobin & Company Limited (Tobins), Consulting Engineers, were retained by the Respondent as consulting engineers in connection with all aspects of the Works. Prospective tenderers were advised in the advertisement that contract documents might be obtained from Tobins, who would furnish Instructions to Tenderers and the form of tender. The deadline for receipt of completed tenders was 29th April, 1992 at 4.00 p.m.

17. Before expiry of that deadline, 24 tenders were received by the Respondent. On 6th May, 1992, the 24 tenders were sent to Tobins for examination and for a recommendation as to which tender should be accepted.

18. Mr. Donal A. Downes (Mr. Downes), the Chairman and Managing Director of Tobins, had responsibility for examining the tenders and making the recommendation to the Respondent. Examination of each of the 24 forms of tender disclosed that the three lowest tenders were those submitted by the Applicant, Mulcair and Pierse Contracting Limited (Pierse). The Bills of Quantities of the three lowest tenderers were mathematically checked in detail and corrected. The result was that the Applicant's tender was the lowest at £5,378,528, Mulcair's was the second lowest at £5,508,919 and Pierse's was the third lowest at £5,623,966.

19. On 17th June, 1992, the Applicant's representatives attended a pre-adjudication interview at Tobins' offices. At that interview, it was pointed out by Mr. Downes that the Applicant had not stated a time for completion, as it was required to do, in its tender. The Applicant's representatives furnished Mr. Downes with a time schedule which showed a time for completion of 92 weeks. Mr. Downes also queried the propriety of the Applicant's treatment of a provisional sum of £90,000 for dayworks materials in the Bills of Quantities in respect of which the Applicant had made a 100% deduction. It is clear that the Applicant's representatives were under the impression that in relation to this latter point the validity of the Applicant's tender was at issue and it was intimated to Mr. Downes that an expert's opinion on the validity of its treatment of the provisional sum would be submitted to Mr. Downes. Mr. Downes agreed to read the opinion. Another matter raised by Mr. Downes at the interview was the fact that the Applicant had priced a large number of items in the priced Bills of Quantities submitted by it with its tender at a zero rate.

20. Subsequent to the interview on 30th June, 1992, the Applicant furnished to Mr. Downes a report of Mr. K.G. Stavely (Mr. Stavely), Consulting Engineer, who expressed the view that the Applicant's treatment of the provisional sum of £90,000.00 for dayworks materials did not invalidate its tender.

21. Tobins furnished a report dated 30th June, 1992 on the tenders (the Report on Tenders) to the Respondent in which they recommended acceptance of Mulcair's tender and the non-acceptance of the Applicant's lower tender for the reasons set out in the report. The recommendation of Tobins was endorsed by Mr. Joe Beirne, the County Engineer of the Respondent. On 25th August, 1992, the County Manager of the Respondent made an order approving acceptance of the tender of Mulcair subject to the approval of the Minister for the Environment. By letter dated 16th August, 1993 the Department of the Environment apprised the Respondent that the Minister for the Environment would raise no objection to the acceptance of Mulcair's tender subject to Tobins being satisfied as to his competence to implement the contract and to the County Manager considering that the sureties offered by him were adequate for its due performance.

22. In compliance with a request from the Applicant under Article 8 of the 1989 Directive, the Respondent, by letter dated 30th August, 1993, quoted almost in their entirety the reasons given in the Report on Tenders as its reasons for non-acceptance, on the recommendation of Tobins, of the Applicant's tender, in the following terms:-

23. Omitted from the reasons set out in the letter was the passage in the Report on Tenders in which the significance of the Applicant's treatment of the provisional sum for dayworks materials was summarised, which was in the following terms:-

24. On 29th September, 1993, the Respondent entered into a contract with Mulcair for the execution of the Works on foot of its tender and execution of the Works commenced on 2nd November, 1993. In these proceedings, the Applicant did not pursue any remedy which would have had the effect of suspending or setting aside the contract with Mulcair. What the Applicant seeks is to establish is an infringement of Community law and of national law by the Respondent in not accepting its tender and its entitlement to damages for that infringement. The parties have agreed that this Court should only deal with the issue of liability at this juncture and that the question of the quantum of the damages, if any, to which the Applicant is entitled be left over to a later hearing.

25. Before considering the nature of the review of decisions of contracting authorities envisaged in the Remedies Directive and in the Remedies Regulations, I think it would be instructive to outline the decision which is impugned by the Applicant and the basis on which it is impugned.

26. The decision which is impugned is the decision of the County Manager awarding the contract for the Works, the award of which was subject to the provisions of the 1971 Directive and the 1989 Directive, to Mulcair, which submitted the second lowest corrected tender, and not awarding it to the Applicant, which submitted the lowest corrected tender. It is clear that, in making that decision, the County Manager adopted the recommendation in the Report on Tenders and the reasoning underlying that recommendation. The basis on which the decision is impugned is that, by virtue of Article 29 of the 1971 Directive and the 1992 Regulations, the Respondent, not having adopted the lowest price only criterion, was obliged to award the contract for the Works to the person who submitted the tender which was adjudged to be the most economically advantageous on the basis of contractual criteria stated in the contract documents or in the contract notice, but did not do so, in that the Applicant's tender, and not Mulcair's tender, was in fact the most economically advantageous on that basis.

27. While acknowledging that this Court cannot substitute its decision for the decision of the County Manager, Counsel for the Applicant submitted that the Court must embark on a rigorous assessment of the merits of the decision. This approach, it was contended, is justifiable on two bases. First, it was contended that it is justifiable under ordinary principles of administrative law and, in support of this contention, Counsel for the Applicant relied on the commentary and authorities cited in Wade on Administrative Law , 7th Edition, pp. 395 - 409. Secondly, it was contended that, in any event, this matter involves a Community law dimension which justifies a more extensive review than would be permissible under ordinary administrative law principles.

28. In support of the second contention, Counsel for the Applicant advanced the views expressed by the authors of the two text books recently published in the United Kingdom. First, the Applicant relied on the following passage from Lewis on Judicial Remedies in Public Law (Sweet & Maxwell, 1992) at page 462:-

29. The second author, D'Sa, is similarly diffident in European Community Law and Civil Remedies in England and Wales (Sweet & Maxwell, 1994) in stating at page 194 that the approach of the Court in a judicial review application involving a point of Community law may differ from cases in which only domestic law is involved.

30. Both Lewis and D'Sa cite the decision of the English High Court (Forbes J.) in R. -v- Minister for Agriculture, Fisheries and Food ex parte Bell Lines Limited and An Bord Bainne Co-operative Limited , 1984 2 C.M.L.R. 502 as the foundation for the proposition that the parameters of judicial review may be broader where a contravention of Community law is alleged than in cases in which a breach of domestic law only is alleged. Counsel for the Applicant also relied on this decision as indicative of a recognition by the courts in England of the necessity to engage in fact finding on judicial review, where under Commuinity law the national courts are charged with determining whether there has been a breach of Community law.

31. I do not consider it necessary to express any view on the tentative theses advanced by Lewis and D'Sa. The type of Community law dimension which Lewis exemplifies in the passage quoted above and which was present in R. -v- Minister for Agriculture, Fisheries and Food - an issue as to whether an administrative decision which prima facie is an impermissible restriction on intra-Community trade contrary to Article 30 of the EEC Treaty is saved from invalidity by, say, the "protection of health" saver provided for in Article 36 - is absent in the instant case. The Applicant's complaint here is that the Respondent's decision infringes Article 29 of the 1971 Directive, which is part of the domestic law of the State by virtue of the 1992 Regulations. In point of principle, in my view, there is no reason why the Court should adopt a different method of review of that decision than it would adopt in reviewing an administrative decision which it is alleged contravenes a regulation the genesis of which is not Community law. Moreover, by its terms, the Remedies Directive requires Member States to provide a mechanism for reviewing effectively the decisions of contracting authorities and, by its terms, the Remedies Regulations requires the "review procedures" referred to in the Remedies Directive to be carried out and exercised by this Court. Neither the Remedies Directive nor the Remedies Regulations, either expressly or by implication, suggests that the review is to be in the form of an appeal on the merits. The requirement in the Remedies Directive that the review should be effective, in my view, goes to the procedural aspects of the review and the efficacy of the remedies available to give effect to the review, which matters are specifically addressed in Articles 2.1 and 2.7, rather than to the substantive nature of the review process and the principles applicable in its conduct.

32. Having held that this review of the decision of the Respondent falls to be conducted in accordance with ordinary principles of administrative law, it is necessary to consider whether those principles require, or even permit, a rigorous assessment of the merits of the decision, as contended for by Counsel for the Applicant.

33. Counsel for the Applicant invoked what are now commonly called the " Wednesbury Principles ", that is to say, the principles enunciated by Lord Greene M.R. in Associated Provincial Picture Houses Limited -v- Wednesbury Corporation (1948) 1 KB 223. These principles are summarised in the following passage at the end of Lord Greene's judgment at pages 233 to 234 where he stated:-

34. Counsel for the Applicant also invoked the subsequent development of the " Wednesbury Principle " by the English courts as epitomised in the following passage from Wade at page 400:-

35. It was the end of the judicial review spectrum referred to at the end of that quotation - self -misdirection and addressing oneself to the wrong question - which the Applicant sought to invoke in particular.

36. While the principle of unreasonableness or irrationality derived from the Wednesbury case has been applied in this jurisdiction in distinguishing between proper use and improper abuse of power, the subsequent development of the principle by the English courts has not found universal approval and the approach adopted in some cases has been expressly rejected in this jurisdiction. In The State (Keegan) -v- The Stardust Compensation Tribunal (1986) I.R. 642, having rejected "defiance of logic or of accepted moral standards" as the test of unreasonableness or irrationality as posited by Lord Diplock in Council of Civil Service Unions -v- Minister for the Civil Service (1985) AC 374 at page 410, Henchy J. said at page 658:-

37. The test of unreasonableness or irrationality posited in the foregoing passage was reiterated by the Supreme Court in O'Keeffe -v- An Bord Pleanala (1993) 1 I.R. 39. In that case, having reviewed the decision of Lord Greene M.R. and the decision of Henchy J., Finlay C.J. stated at page 71:-

38. The Applicant's application for judicial review was grounded on an Affidavit sworn by Michael Shaughnessy (Mr. Shaughnessy), a Director of the Applicant. The Respondent's Statement of Opposition in the judicial review proceedings was verified by the Affidavit of Padraig Hughes, the County Secretary of the Respondent, and two Affidavits of Mr. Downes. In general, these Affidavits dealt with the chronology of events, the contract documentation and the contents of the Report on Tenders. The grounding and replying Affidavits filed in the proceedings initiated by way of Special Summons more or less replicated the Affidavits filed in the judicial review proceedings.

39. On 13th April, 1994, by Order of this Court made by Lynch J., the Respondent was ordered to make discovery of the tender documents submitted by the successful tenderer, Mulcair, subject to very strict terms and conditions as to confidentiality. Subsequently, as permitted by that Order, Mulcair's tender was examined by Mr. Stavely and compared with the Applicant's tender and on foot of that examination and comparison Mr. Stavely issued a "Commentary on Tobins' Report on Tenders", which was dated 6th July, 1994 and which was exhibited in an Affidavit sworn by him in the judicial review proceedings.

40. At the hearing of these proceedings, Mr. Shaughnessy, Mr. Downes and Mr. Stavely and a number of other witnesses gave oral testimony. No rules of court governing reviews by this Court under the Remedies Regulations had been enacted at the time of the hearing.

41. The documentation on the basis of which the tenderers were invited to tender for the Works and which was to form the basis of the contract of the successful tenderer with the Respondent comprised the following documents:-

42. Clause 1.24 of the Specification dealt with the criteria for the award of the contract and disclosed that it was the policy of Tobins to make a detailed examination of the Bills of Quantities and other documentation furnished by the lowest, second lowest and third lowest tenderers and to correct them mathematically. It was provided that in examining the Bills of Quantities Tobins were entitled to make comparisons as between the prices quoted and their own estimate of the cost. It was further provided that Tobins' recommendation would have account of the stipulation in the public advertisement that the lowest or any tender need not necessarily be accepted. It was provided that, apart from the cost element, eleven other criteria, which were listed and which in the main related to technical merit and ability to perform the contract, might be relevant in the appointment of the contractor and it was provided that information in relation to the matters covered by these criteria would only be sought from short listed tenderers who appeared most suitable on all other accounts and who at an appropriate time following preliminary examination of the Bills of Quantities might be called to a pre-adjudication interview.

43. In broad terms, the multiplicity of arguments advanced by the Applicant in support of its contention that the decision of the County Manager was ultra vires can be subsumed under two headings. First, insofar as regard was had to the failure of the Applicant to stipulate a period for completion in its tender, it was contended that an irrelevant matter was taken into account, in that the period for completion was not a contractual criterion for the award of the contract. Secondly, it was contended that the methodology and reasoning adopted by Mr. Downes in the appraisal and comparison of the three lowest corrected tenders and, in particular, his comparison of the tenders of the Applicant and Mulcair in terms of price, which resulted in the decision that the Applicant's tender was not the most economically advantageous to the Respondent, was so unreasonable and irrational on various grounds of irrelevancy and self-misdirection as to be ultra vires.

44. Clause 1.74 of the Specification provided that each contractor tendering should state in his tender the minimum period in calendar months, calculated from the date of the engineer's written order to proceed, which he would require to fully complete all of the work. Item 5 in the Appendix to the form of tender, which was to be completed by each tenderer, provided as follows:-

45. The reference to 43 was a reference to Clause 43 of the Conditions of Contract applicable under Clause 1.01 of the Specification to which I have alluded above. The Applicant did not complete item 5. Mulcair inserted a period of 75 weeks in item 5 and Pierse inserted a period of 78 weeks.

46. In paragraph 6 of his Affidavit sworn on 4th November, 1993, Mr. Downes averred that the notice of the contract published in the Official Journal and the advertisement in the national newspapers and the Instructions to Tenderers informed prospective tenderers that the contract would be awarded on the basis of the most economically advantageous tender having regard to such criteria "as price, period for completion, and technical merit of the tender". Although "period for completion" is one of the examples given in Article 29 of the 1971 Directive of the criteria which may be applied in determining which is the most economically advantageous tender, neither the notice published in the Official Journal nor the advertisement nor any of the contract documents stipulated in explicit terms that the time for completion was one of the criteria by reference to which the contract would be awarded, although paragraph 7 of Clause 1.24 of the Specification identified the ability of the tenderer to meet time schedules as one of the criteria which might be relevant in awarding the contract. Accordingly, the averment in Mr. Downes' Affidavit was incorrect. Nevertheless, it was argued on behalf of the Applicant, the averment evidences that Mr. Downes had regard to a criterion which was not stated in the contract documents or in the contract notice as being a basis for the award of the contract as required by Article 29 and, in so doing, that he had regard to an irrelevant matter in contravention of Article 29.

47. In the Report on Tenders, ofwhich Mr. Downes was the author, he stated apropos of the Applicant's tender:-

48. Later, in the Report on Tenders, Mr. Downes recorded that he had been presented with the time schedule at the pre-adjudication interview. This indicated a period of 92 weeks which he considered not to be out of line with the timescales referred to by Mulcair and Pierse, although he pointed out that the Applicant's submission was post-tender.

49. Notwithstanding that Mr. Downes recorded in the Report on Tenders his "very serious reservations" and "grave doubts" as to the validity of the Applicant's tender, the evidence establishes that he overcame those reservations insofar as he did not reject the Applicant's tender on the ground of invalidity and included it in the detailed evaluation and comparison process of the three lowest corrected tenders. Moreover, although Mr. Downes listed the Applicant's failure to submit a time for completion at the date of tender as one of his reasons for not recommending acceptance of the Applicant's tender, the evidence establishes that, in the final analysis, Mr. Downes treated this failure as of no substantial relevance in his determination and, if the Applicant's tender had presented no other problem, he would have ignored it.

50. Accordingly, in my view, the Applicant has not established that, in his adjudication, Mr. Downes regarded the period for completion as one of the determining criteria by reference to which the most economically advantageous tender was to be identified or that he rejected the Applicant's tender because of the omission to state a period for completion. Accordingly, in my view, the Applicant has not established that Mr. Downes took into account a matter which he should not have taken into account.

51. The Applicant's challenge to the decision of the County Manager on the grounds of unreasonableness or irrationality was founded largely on the expert opinion of Mr. Stavely who, having examined and compared the pricing of the Bills of Quantities submitted by the Applicant and Mulcair respectively, concluded that, the only operable criterion for adjudication between the two tenders being cost or price (which terms were used interchangeably in the contract documentation and which I am satisfied were intended to have the same meaning), given that the tenderers equally satisfied the "technical merit" criterion, the tender of the Applicant was the most economically advantageous to the Respondent. Mr. Stavely's opinion was that the adjudication process and the reasoning of Mr. Downes was flawed and resulted in a wrong conclusion as to which of the two tenders was the most economically advantageous on the basis of the stipulated contractual criteria.

52. Mr. Stavely was critical of the manner in which the Respondent reached the conclusions reflected in the reasons for non-recommendation of the acceptance of the Applicant's tender adopted by the Respondent and set out at (b), (c) and (d) of the letter dated 30th August, 1993, which I have quoted above.

53. The reason set out at (b) related to the provision in the Bills of Quantities of a provisional sum of £90,000 for dayworks materials and for a percentage addition to that sum for overheads, profits, etc. The Applicant priced the percentage addition at minus 100%. Mulcair did not alter the £90,000 provision and indicated 0% percentage addition. At the pre-adjudication interview on 17th June, 1992, Mr. Downes sought to clarify why the Applicant had deleted the provisional sum, as Mr. Downes perceived to be the effect of the Applicant's treatment of this item. He was told by Mr. Shaughnessy that the Applicant's understanding was that it would have to supply dayworks materials to the value of £90,000 free of charge if so required by Tobins. It is clear from the evidence that the Applicant's assessment was that the provisional sum of £90,000 was an over-estimate of what the actual requirement for day works materials would turn out to be. Mr. Downes' view was that the Applicant should have addressed this possibility through the mechanism of the adjustment item by making an appropriate deduction. His objection to the Applicant's treatment of this element of the Bills of Quantities was twofold, namely:

54. Mr. Stavely considered that Mr. Downes' interpretation of the Applicant's treatment of the provisional sum was wrong and that the provisional sum of £90,000 was neither deleted nor withdrawn and that the correct interpretation was that the Applicant had offered to supply £90,000 value of dayworks materials free of charge. Moreover, in his opinion, in order to eliminate the distortion and achieve a proper comparison between the Applicant's tender and that of Mulcair, Mr. Downes should have estimated the probable out-turn of expenditure on dayworks materials against the provisional item and then compared the two tenders adjusted on that basis. The scenario envisaged in Mr. Downes' illustration in the Report on Tenders, which I have quoted above, of the significance of the Applicant's treatment of the provisional sum was nil actual expenditure under this heading - the most advantageous scenario from the Applicant's perspective. Even if one adjusted the competing tenders to reflect this possible, if unlikely, eventuality, by reducing Mulcair's tender price by £99,000 (the provisional sum of £90,000 together with £9,000 in respect of VAT), the result was that the Applicant's tender was still lower than Mulcair's. However, the likelihood of there being no expenditure on dayworks material was extremely remote and, if a sensitivity analysis had been carried out by Mr. Downes, as Mr. Stavely presumed in his report of 29th June, 1992 would be done and as he considered should have been done, the appropriate reduction in Mulcair's tender price to eliminate the distortion would have been of a lesser order than £99,000 and the differential between the Applicant's tender and Mulcair's tender on that adjusted basis would have been greater than £31,391.13.

55. The reason set out at (c) in the letter of 30th August, 1993 reflected Mr. Downes' disapproval of the Applicant's pricing stratagem in pricing individual items in the Bills of Quantities at zero rate and including the real price of those items against other items, not necessarily of an identical nature, so that the real price of the zero rated items and the true rate for a unit of work was hidden. Of the 4,097 items in the Bills of Quantities, the Applicant zero rated 1,125, equivalent to 27.5%, of all items. Mr. Downes acknowledged that Mulcair also zero rated or "included" many items - 741 items or 18% of all items. However, unlike the Applicant, Mulcair priced all major items of measured work and Mr. Downes concluded that Mulcair submitted a "more balanced" tender than either the Applicant or Pierse.

56. The reason set out at (d) in the letter of 30th August, 1993 reflected Mr. Downes' perception of the adverse consequences of accepting the Applicant's tender, which was based on Bills of Quantity in which major items of measured work were zero rated. As Mr. Downes saw it, the freedom of Tobins to administer and manage the contract in the manner most economically advantageous to the Respondent was curtailed. In the absence of a true rate for a unit of work, the assessment at adjudication stage of the effect of quantity fluctuations on the contract price was difficult, if not impossible, to evaluate. Moreover, control of the price of ordered variations post-contract would be difficult, if not impossible, if the Applicant's tender was accepted. Mr. Downes did not consider it appropriate to base his adjudication on clarification post-tender and pre-adjudication of the quantities and rates allowed for in the pricing of the Bills of Quantities by the Applicant, where these were not apparent on the face of the tender itself, because to do so could open the door to post-tendering.

57. Mr. Stavely's opinion was that in pricing the Bills of Quantities, the Applicant had complied fully with the requirements of the contract documentation. The insertion of a zero rate against an item of work was not proscribed in the contract documentation. While the tenders of both the Applicant and Mulcair were "unbalanced" to a greater or lesser degree, in his opinion, this did not render the evaluation or comparison of the tenders impossible or even unduly difficult, although it would have rendered the process of adjudication, had it been properly conducted, more tedious. In order to identify the most economically advantageous tender having regard to price, both lowest tenderers having resorted to pricing stratagems such as zero rating an item or "including" the price of an item in the price of another item, it was the duty of Mr. Downes to seek clarification at the pre-adjudication interview of the quantities allowed for by the tenderers and the rates applicable thereto. Under the contract documentation, Mr. Downes was entitled to seek such clarification. In the case of the Applicant, Mr. Downes was entitled to and he should have required the Applicant's representatives to produce a complete build-up of the prices at the pre-adjudication interview. Such a build-up was available, as was clear from Mr. Shaughnessy's evidence. The contract documentation contained mechanisms to enable Mr. Downes to obtain the information necessary to assess pre-adjudication the effect of quantity fluctuations on the tender and also to control the price of ordered variations in a post-contract context.

58. Apart from refuting Mr. Downes' analysis of the Applicant's pricing stratagems and his perception of their lack of any real economic benefit to the Respondent as reflected in the reasons for his recommendation that the Applicant's tender should not be accepted, Mr. Stavely adverted to many instances in the adjudication process in which, in his opinion, Mr. Downes adopted an inappropriate approach or carried out an inappropriate exercise and many instances in which, in his opinion, Mr. Downes failed to adopt an appropriate approach or to carry out an appropriate exercise. Two examples, which are somewhat linked, illustrate this aspect of Mr. Stavely's evidence. Mr. Stavely considered that the exercise attempted by Mr. Downes to use the adjustment item (under which the Applicant gave a reduction of £100,000 and Mulcair gave a reduction of £557,746) as a percentage reduction to make a comparison of the tenders on a "like for like" basis related to a bill by bill examination of the thirty seven individual bills which made up the Bills of Quantities, was not a valid exercise, because the adjustment item was a lump sum and it had no relation to the other rates or prices in the bills. The attempt to adjust the priced value of work items pro-rata by reference to the adjustment item expressed as a percentage led to a distortion and gave Mr. Downes an incorrect picture of the comparative advantage of the Applicant's bill vis-à-vis Mulcair's tender or vice versa.. On the other hand, Mr. Stavely pointed out that where the overall tender prices are very close, the tender which contains the largest lump sum adjustment item will automatically be the tender with the highest unit rates on average. It was suggested that had Mr. Downes done a simple exercise he would have ascertained that the aggregate price for rated work items (i.e. items other than provisional sums and p.c. sums) in Mulcair's tender was 16.5% higher than the corresponding aggregate price in the Applicant's tender. Mr. Stavely suggested that this exercise would have demonstrated to Mr. Downes that, in the event of an increase of quantities during the implementation of the contract, the cost to the Respondent would, on average, be 16.5% higher if Mulcair's tender were accepted than if the Applicant's tender were accepted.

59. The foregoing is not and is not intended to be an exhaustive resume of Mr. Stavely's analysis and criticism of Mr. Downes' evaluation and comparison of the three lowest tenders. The overall thrust of Mr. Stavely's evidence was that the Applicant's tender price, being the lowest, was prima facie the most economically advantageous in terms of price. Even if one adjusted that tender price to take account of the probable out-turn on dayworks materials and possible fluctuations in quantities, based on the information contained in the Report on Tenders, which suggested that steel reinforcement was over-estimated by 15% and rock excavation by 10%, the adjusted tender price would still be lower than Mulcair's tender price. In short, the Report on Tenders had not demonstrated that the Applicant's tender was not the most economically advantageous price-wise.

60. In reviewing Mr. Downes' evaluation and comparison of the tenders in the light of Mr. Stavely's criticism of the approach he adopted and of his conclusions as to which of the tenders was the most economically advantageous price-wise, in my view, the following factors have to be borne in mind:

61. Underlying the Applicant's challenge on the ground of unreasonableness or irrationality is the assertion that Mr. Stavely is correct in his professional opinion that Mr. Downes' professional opinion that the Applicant's tender, although the lowest, would not turn out to be the most economically advantageous to the Respondent is incorrect. It is not the Court's function to assess the two conflicting professional opinions to determine which is correct on the balance of probabilities. The Court's function is to determine whether the Applicant has established that the decision of the Respondent, based on Mr. Downes' professional opinion, plainly and unambiguously flies in the face of fundamental reason and common sense. I have no doubt that the Applicant has not discharged that onus.

62. Accordingly, the Applicant is not entitled to any of the declaratory reliefs sought in these proceedings and the Respondent is not liable in damages to the Applicant for breach of the 1971 Directive, as amended, and the 1992 Regulations.