An extension of the standstill period in procurement does not mean an extension to the limitation period
This decision by the High Court confirms the interaction (or lack of it) between standstill periods and limitation periods in relation to the Public Contracts Regulations 2015 (PCR 2015). Parties are free to agree an extension of the standstill period between them but this will not affect the running of the limitation period.
Access for Living v London Borough of Lewisham
The decision emphasises the need for economic operators to be vigilant in observing the limitation period and not to conflate agreed extensions to the standstill period with extensions to the limitation period.
Facts
Access for Living (AFL) is a not-for-profit registered company which supports people with learning disabilities. In October 2019, London Borough of Lewisham (LBL) began a mini-competition for the award of contracts for providing 12 adult learning supported living services.
On 7 February 2020, LBL stated that AFL were unsuccessful in all five of their lots (where it was the existing provider) on the basis that it had failed to provide sufficient detail around one of the prescribed method statements concerning support hours. LBL considered that AFL had not evidenced its involvement of service users in planning their own support and had not addressed how any reduction in support would be managed and monitored.
Following notification of the decision, a ten-day standstill period applied preventing LBL from entering into new contracts. At the request of AFL, LBL agreed to extend this standstill period to 13 March 2020. The correspondence was silent on the issue of limitation.
AFL issued proceedings pursuant to Regulation 91 of the PCR 2015 on 11 March 2020. LBL disputed AFL’s claims and argued that AFL’s claim had been made out of time.
Law
92(2) of PCR 2015 states that proceedings must be started within 30 days from when the economic operator first knew the grounds for starting the proceedings had arisen. In this case this 30 day window started on 7 February 2020 when AFL became aware of LBL’s reason for its unsuccessful bid and thereby ended on 9 March 2020. On this basis, AFL applied to the court for an extension of time to the 30 day limitation period on the basis that the court has a general jurisdiction to grant an extension of up to 3 months from the date of breach.
Decision
The High Court refused the application for an extension and struck out the claim. This decision was reached because:
- The fact that the delay was short (2 days) was not, in itself, reason to extend time.
- The fact that LBL was AFL’s only client was not relevant.
- The granting of an extension would prejudice LBL which was looking to let the new contracts free from any risk that AFL would issue proceedings.
Implications
- The decision by the High Court re-confirms the court’s strict adherence to the 30-day limitation period and that there needs to be generally an exceptional reason, usually outside the control of the economic operator, before the court will entertain an extension.
- Parties are free to agree a standstill period between them but that will not affect the running of the limitation period.
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