News archive

Elekta Limited v The Common Services Agency, 21 June 2011
Outer House case concerning the procurement of radio therapy equipment (with an estimated value of around £21m) for cancer centres in Scotland.

Elekta, which produced radio therapy equipment, complained that the Common Services Agency (also known as NHS National Services Scotland), which was responsible for procuring the equipment, had effectively excluded them from bidding by specifying criteria which could only be met by one tenderer.  Four out of the five cancer centres in Scotland had a system manufactured by Varian and the Agency specified that the equipment would have to integrate with the Varian system. However, Elekta argued that Varian system was not compatible with those of other suppliers meaning that everyone other than Varian was excluded from bidding.

The effect of Elekta raising the proceedings (in terms of the Public Contract (Scotland) Regulations 2006) was to prevent the Common Services Agency from entering the contract with Varian and the Agency applied for an interim order bringing that prohibition to an end.

After considering the authorities, Lord Glennie laid down a number of points:

• the contracting authority must be entitled to decide upon the functional requirements it wishes to satisfy;

• the fact that the criteria included in the tender notice can only be met by one tenderer, or a limited range of tenderers, does not of itself contravene the principle of equality;

• the inclusion of these criteria can only be considered discriminatory if they cannot be justified objectively having regard to the characteristics of the contract and the needs of the contracting authority.

Lord Glennie noted that Elektra had not argued that the criteria were not objectively justified and pointed out that there a number of possible justifications for the decision such as the cost, disruption and potential teething problems involved in replacing one system with another.

Elekta also referred to the fact that the Agency had followed an open procedure (under regulation 15 of the procurement regulations) rather than the negotiated procedure (under regulation 14) arguing that, if it chose to follow the open procedure, it had a duty to frame the criteria in such a way that allowed a range of tenderers to bid. However, Lord Glennie said that, whilst it may have been that the Agency could have used the negotiated procedure, it did not follow that, by going down the route of the open procedure, it had to remove criteria which it regarded as essential to define its requirements (i.e. that the system could integrate with the Varian system).

In addition, Elekta complained that the criteria requiring integration with the Varian system had also been applied to the one cancer centre which did not already have Varian equipment. However, Lord Glennie also found that there was no merit in this point. The contracting authority was entitled to decide what its procurement requirements were and how to frame them.  It could properly decide (on the basis of objectively justifiable criteria) that there should be a sole tenderer to provide equipment across the five centres.

Lord Glennie was not asked to dismiss Elekta’s action but found its case to be a very weak one which had no reasonable prospect of success. As such, an interim order was granted removing the prohibition on the Agency contacting with Varian.

The paper calls for control of the Crown Estate which consists of the seabed, foreshore and other public assets to be devolved to the Scottish Parliament.

The Scottish Government’s news release is available here

The paper is available here

The Convention of Scottish Local Authorities (COSLA), the umbrella body for Scotland’s 32 local authorities has warned that uncertainty over the economy and changes to the welfare system could reverse years of improving council tax collection rates.

Council tax collection rates rose again in the past year, up by 0.2% on the previous 12 months, despite more than £1 billion having gone unpaid since the charge began 18 years ago.

For 2010-11, £1.86bn was paid by March 31 from the total bill of £1.97bn.

Differences remain among local authorities, with taxpayers in Glasgow only paying 92.3% last year compared with a 97.6% total in Orkney.

Dundee recorded the highest increase with a collection improvement of 91.4% to 93% over the past year.The average percentage of bills collected annually across Scotland’s 32 councils increased from about 87.2% in 1998-99 to 94.6%.

The article in the Herald newspaper can be found here.

Outer House case in which a tenant (Ralph Lauren) of premises on Ingram Street in Glasgow sought to prevent the landlord (the pension fund) from letting a neighbouring unit (Unit 6) to a hairdressing salon on the basis of an obligation contained in a back letter.

The back letter granted by the pension fund provided:

“We shall not grant first lettings of that one of the Commercial Units (as defined in the Lease) known as Unit 6, situated to the north of that one of the Commercial Units let as at the date hereof to All Saints Retail Ltd, to retailers other than high quality fashion retailers as are approved by you (such approval not to be unreasonably withheld or delayed).”

Ralph Lauren sought an interim interdict on the basis that the hairdressing salon was not a high quality fashion retailer. On the other hand, the pension fund argued that, in terms of the back letter, as the hairdressing salon was not a retailer, Ralph Lauren’s permission was not required.

Ralph Lauren contended that the pension fund’s interpretation would permit the landlord to let the premises to anyone who did not sell goods which they argued was an absurd consequence given the context in which the undertaking had been given. As a result, they urged that back letter should be construed in a commercially sensible, rather than a purely literal, way.

However, Lord Glennie agreed with the pension fund’s arguments and found that the letter did not restrict the pension fund with regard to lettings to non-retailers (noting that it was “nigh impossible” to describe a hairdresser as a retailer). Whilst it was “permissible to do some slight violence to the language of a clause in a contract where a literal construction would defeat what is objectively the intention of the parties to it”, there was no basis for applying that approach in this case. There was nothing to suggest that the parties had intended a restriction on all lettings other than high quality fashion retailers. There was no evidence to suggest that a high quality fashion retailer such as Ralph Lauren would consider themselves to be prejudiced by the letting of a neighbouring unit to, for example, a restaurant or a cafe. If they had wished to prevent such a letting it would have been easy to address it in the undertaking.

Lord Glennie came to the conclusion that Ralph Lauren had not shown that they had a prima face case and refused the motion for interim interdict although leave to reclaim was granted.

The full judgement is available from Scottish Courts here.

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.

A residential hospital for vulnerable adults near Bristol where alleged abuse was secretly filmed by the BBC Panorama programme is to close on Friday.

Castlebeck, which runs Winterbourne View, said the hospital would close on 24 June when the last patients would be transferred to alternative services.

The BBC news report can be found here.

Delivering Sustainable Flood Risk Management, 15 June 2011
Guidance complementing the Flood Risk Management (Scotland) Act 2009. It sets out statutory guidance to SEPA, local authorities and Scottish Water on fulfilling their responsibilities under the Act.

The full document  is available from the Scottish Government website here

Police are trying to establish the circumstances surrounding the death of a Glasgow man whose mother took him to a Swiss clinic to die.

Helen Cowie told BBC Scotland’s Call Kaye show she helped her son Robert, 33, commit suicide after he was left paralysed from the neck down.

Mrs Cowie, of Cardonald, Glasgow, said her son went to Dignitas in October and “had a very peaceful ending”.

The report from BBC News can be found here.

Last December the Scottish Parliament rejected plans to give terminally ill people the right to choose when to die.  Independent MSP Margo MacDonald’s End of Life Assistance Bill aimed to make it legal for someone to seek help to end their life.  The Bill was defeated by 85 votes to 16 with two abstentions.

The Office of the Public Guardian (Scotland) is not currently able to meet its target turnaround time of registering Powers of Attorney within 30 working days from receipt.

Not surprisingly the OPG is receiving a significant amount of telephone calls from customers seeking confirmation that it has received their Powers of Attorney for registration.

The OPG currently estimate that registration should be notified within two months of the Powers of Attorney being sent to the OPG.

Edwin Morgan, who died last year aged 90, is thought to have left the SNP a significant part of his estate.

He became the Scotland’s first national poet – or Scots Makar – in 2004 by then First Minister Jack McConnell.

The report from the BBC can be found here and the Sunday Herald here.

Outer House case considering the meaning of “waste” in terms of the lease of a landfill site near Stranraer.  The lease provided that the tenants (Shanks) were to make royalty payments to the landlords (Landmore) for “inert waste” entering the site.

The question for the court was whether soil which had been brought on to the site for the purpose of capping cells of waste deposited at the site was also “inert waste” and therefore subject to the royalty payment.

Lord Menzies found that the soil was “inert waste”.  In coming to that conclusion, he noted that the exercise was one of construction of a private commercial contact and thus differed from cases in which the courts were construing EU directives or regulations (albeit he noted in passing that the decision he reached was in line with authorities concerned with the interpretation of the EU regime).

The soil came from a construction site on which houses were being built. It was discarded by the developer who paid haulage contractors to take it away and was an unwanted by product caused by the need to provide flat foundations for the houses. Nothing was done to it before it entered the landfill site. As such, Lord Menzies took the view that the soil fell within the ordinary and natural meaning of “waste”. Although it was useful to Shanks, Lord Menzies did not consider that it was appropriate when considering the parties intentions objectively to view the situation from the perspective of the potential user of the material pointing out that anything –or almost anything –can be put to use by someone.

“Having consumed all the meat from a roast leg of lamb, I may discard it into my household rubbish. It is useless to me. My dog may have a different view of its usefulness, and may retrieve it for his own purposes – but despite its usefulness to him, it remains waste.”

The full judgment is available from Scottish Courts here.

 All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.