The recent European case of Uniplex v NHS Business Services Authority has provided some useful clarification on the limitation period for a claim for damages under Reg. 47 of The Public Contracts Regulations 2006 (the "Regulations").
Reg. 47 provides that challengers must bring a claim for damages "promptly" and in any event within three months of the date on which the grounds for the claim first arose. Until this judgment, it has been unclear how the requirement to begin a claim "promptly" fits together with that three month period. There have also been questions about "the date on which grounds for the claim first arose" - does this mean the date of the breach itself, for example, or alternatively does it refer to the date that the challenger became aware of the breach? The judgment is helpful in two ways. It confirms that:
- the period for bringing proceedings should start to run from the date on which the claimant knew, or ought to have known, of the alleged breach; and
- the wording in Regulation 47 which allows a court to dismiss an action brought within three months on the grounds that it is not brought "promptly" breaches the principles of certainty and effectiveness and is not compatible with the Remedies Directive. Challengers are entitled to the full three months in which to bring their claim.
This is of course in relation to a straightforward damages claim; claims for ineffectiveness have different limitation periods.
The very recent case of SITA v Greater Manchester Waste Disposal Authority was the first major case to apply the Uniplex principles in the UK. It also clarified some of the open issues not addressed in Uniplex. For example, it confirmed that time "starts to run" from the point at which the claimant has (or ought to have had) knowledge of the breach. It is not necessary for the claimant also to know that it has suffered a loss, as SITA unsuccessfully attempted to argue.
The SITA decision is therefore of some comfort to contracting authorities because it confirms that a challenger may not "sit on its hands" and wait to see if it suffers a loss but instead must bring the claim as soon as it has knowledge (or should reasonably have had knowledge) of a breach. Overall though, particularly taken together with the recent changes brought in by the Remedies Directive, the effect of the Uniplex case is still likely to be that it will become easier for suppliers to bring a claim in the courts. We also expect amendments to be made to the text of Regulation 47 in due course to reflect this case.