8.2 C AUSES OF ACTION
8.2.2 The classification of chances
In the following, the categories of chances are surveyed. In public procurement cases, a two step test became established and increasingly rigidified. The first step consists of evaluating whether a tenderer has been deprived of any chance of being awarded a contract. Where that question is answered in the negative, the judge is held to proceed to an evaluation of whether a tenderer had a serious chance. The standard formula on the gradation between not being deprived of any chance, and regular and serious chances of being awarded a contract was clarified in an important judgment delivered in 2003:
Considérant que lorsqu'une entreprise candidate à l'attribution d'un marché public demande la réparation du préjudice né de son éviction irrégulière de ce dernier, il appartient au juge de vérifier d'abord si l'entreprise était ou non dépourvue de toute
chance de remporter le marché ; que, dans l'affirmative, l'entreprise n'a droit à aucune
indemnité ; que, dans la négative, elle a droit en principe au remboursement des frais
151
qu'elle a engagés pour présenter son offre ; qu'il convient ensuite de rechercher si
l'entreprise avait des chances sérieuses d'emporter le marché ; que, dans un tel cas,
l'entreprise a droit à être indemnisée de son manque à gagner, incluant nécessairement, puisqu'ils ont été intégrés dans ses charges, les frais de présentation de l'offre qui n'ont donc pas à faire l'objet, sauf stipulation contraire du contrat, d'une indemnisation spécifique [emphasis added]351
The judgment provided for much needed clarification between the different categories of chances, and the steps to be undertaken in order to assess the nature of a chance.
However, one might still doubt whether different categories, that is, legally relevant different degrees of seriousness of chances, exist. Earlier jurisprudence seemed to imply a third category of chances, namely a merely ‘serious or real’ chance as opposed to a ‘very serious’ chance. From the case law rendered in the last ten years, one must consider that the formulation of a chance as ‘serious’ or ‘very serious’ is devoid of influence on the available damages.352 The jurisprudence rendered since is inconclusive on this point, yet the
notion of a merely ‘serious’ chance does not seem to have an impact on the recoverable damages – being the manque à gagner, lost profit, just as under the very serious chance is accorded. At the same time, the formula adopted therein has turned into steady jurisprudence.353 By the absence of testing of merely serious chance, one may deduce that
the courts have stabilized a categorization resting on only two categories: testing (1) the non-deprivation of a chance on the part of a tenderer, and (2) the evaluation of whether the quality of this chance was of a ‘very serious nature’. Seeing that step one results in the recovery of bid costs, and step two in the recovery of lost profit, the evidence is rather conclusive that this categorization is exhaustive and that the quality of chances are no more nuanced than these.
The first step consists of evaluating whether a chance existed at all; the second step, what the quality of that chance was. The jurisprudence has reached a stable point in which
351 CE 4 June 2003, N° 249630.
352 Lichère in 2006 maintained that the consequences of having a ‘very serious’ as opposed to a ‘serious’
chance were still disputed, as was the issue of whether the formulations made a difference in the calculation of the amount of the recoverable damages. F. LICHÈRE, 'Damages for violation of the EC public procurement rules in France', (2006) Public Procurement Law Review, 171, 176.
353 The same formulation has been recalled continuously by the relevant courts: e.g. CAA Lyon, 7 January 2010,
152
the following types of chances are distinguished in a system of a numerus clausus character: Three types of categories of chances thus materialize: no chance (i.e. deprived of a chance); a chance, but one which isn’t serious; and a serious chance. In the following, some examples are put forward for the respective categories:
The non-deprivation of a chance
While the doctrinal lost chance formulation is fixed, its use is versatile. From the first step of the test, the vagueness of the ‘lost chance’ leaves room for several parallel inquiries. Behind the finding that a tenderer was deprived of a chance stand two different evaluations: a) on one hand, ‘not deprived’ is used to express what in reality is, again, a finding on illegality. This is the case when the court, given the indications of the case file, fails to find that the contracting authority made an “incorrect material assessment” or “a manifest error of appreciation”, for example. Under this approach, the court will review the process by which the contracting authority came to its decision. The nature of this review, however, remains to a certain extent external. The judge reviews the decision-making process, but does not substitute this with his/her own assessment in the absence of any illegality and therefore no link to the harm.354 Only the second form constitutes an assessment of the quality of a
tenderer’s chance, and whether the nature of a tenderer’s implication was sufficient to amount to a chance. Here, a court substitutes its own assessment for that of the contracting authority.
Examples of disqualifying factors included the fact that a candidate was “not suitable according to its economic and financial standing or professional and technical knowledge or ability“355, or that a bid did not correspond to a contract notice.356 Despite a particularly low
price, the fact that the qualification criteria were not met was held to deprive a tenderer of a chance:
354 CAA Paris, 18 September 2007, SOCIETE ASF.
355 F. LICHÈRE, 'Damages for violation of the EC public procurement rules in France', (2006) Public Procurement
Law Review, 171, 172 – citing a case 4 June 1976.
356 F. LICHÈRE, 'Damages for violation of the EC public procurement rules in France', (2006) Public Procurement
153
“qui n’a pas donné satisfaction au regard des critères de qualité architecturale et
d’insertion dans le site, nonobstant son coût particulièrement bas, le requérant était dépourvu de toute chance d’obtenir le contrat de concession si la procédure
d’attribution de celle-ci s’était déroulée régulièrement [emphasis added]“357
The result of the first step is either that a candidate was entirely devoid of a chance or, on the contrary, that they had a chance. The latter gives rise to the subsequent second step of whether that chance can be classified as serious or not.
Not deprived of but not serious chance
The second class of chances concerns cases in which a judge does not find a tenderer to have been deprived of all chances of winning a contract but in which the chance is not ultimately assessed as serious, that is to say, ‘the tenderer had a chance, but not a serious one’. More commonly, the court will state that in the particular context the tenderer does not have a right to compensation for lost profits. Due to the fixed linkage between the categories of chances and the recoverable losses, one may then deduce that the chance was not sufficient. However, courts’ decisions on this specific point are often unreasoned.
The judge used this assessment, for example, in the following case: a company participated in two stages of a competitive procedure to win a contract. In the end, the contract was illegally awarded to a competitor that had been eliminated during the first stage. The aggrieved bidder could not be said to have had no chance of being awarded the contract had the competition taken place in the regular fashion. Consequently, it had a right to compensation for the bidding costs. However, compensation for lost profits in that case was rejected:
Considérant qu'il ne résulte pas de l'instruction que la société Golf Conseil, qui avait été retenue, à l'issue de la première place du concours, parmi les cinq entreprises, sur les douze en compétition, pouvant participer à la seconde phase, aurait été dépourvue de
toute chance d'obtenir le marché si le concours s'était déroulé régulièrement ; que le
syndicat intercommunal à vocation unique pour l'étude et pour la réalisation du golf de Cognac est dès lors pas fondé à se plaindre que par le jugement attaqué le tribunal administratif lui a reconnu un droit à indemnité correspondant aux frais qu'elle a inutilement exposés pour participer au concours ;
154
Considérant, en revanche, que dans les circonstances de l'affaire il n'y a pas lieu de
majorer cette somme d'une indemnité correspondant au manque à gagner évoqué par
la société [emphasis added]358
Serious chance
Judges often have to make technical assessments in their evaluations of whether chances qualify as serious or not. This is typically done by (1) determining the criteria which would have decided an offer in the concrete case, here the relationship between the lowest price and other criteria is especially relevant; (2) evaluating the contracting authorities’ (or relevant selection commission) material assessments of the offers submitted by competing bidders as to their validity most importantly, but also in relation to quality; (3) coming to a conclusion as to the relatively better one; and (4) assessing whether the offer was theoretically acceptable to the contracting authority.359 Mostly, the parties in court will then
rely on expert opinions and technical notices in order to sustain the validity and quality of their bids.360
(1) Price versus other criteria
When assessing types of chances, findings for a serious chance include offering the lowest bid (even if the selection was also geared at criteria other than price, under the most advantageous/economical offer)361 on a “presumption of a serious chance for the bidder
with the lowest offer“,362 but this “assumption can be reversed“.363 Reasons for a reversal of
a serious chance due to the lowest price include the differential weighting of other criteria.
358 CE 23 March 1994, Syndicat intercommunal à vocation unique pour l’étude et pour la réalisation du golf de
Cognac, 1 / 4 SSR.
359 On the realization of a natural history museum and related technical expertise see, for example, CE, 8
February 2010, Commune de la Rochelle.
360 CE, 8 February 2010, Commune de la Rochelle.
361 F. LICHÈRE, 'Damages for violation of the EC public procurement rules in France', (2006) Public Procurement
Law Review, 171, 174.
362 F. LICHÈRE, 'Damages for violation of the EC public procurement rules in France', (2006) Public Procurement
Law Review, 171, 174, citing Administrative Court of Appeal of Nancy, 31 May 2001, Société RTP;
Administrative Court of Appeal of Lyon, 8 November 2001, SARL Pugny BTP ; Administrative Court of Appeal of Douai, 21 May 2002, Société Jean Behotas ; Administrative Court of Appeal of Bordeaux, 10 February 2005, SA
Urbaco.
363 F. LICHÈRE, 'Damages for violation of the EC public procurement rules in France', (2006) Public Procurement
155
(2) Validity and objective quality, as well as (3) relative quality of bids
After establishing what criteria the contracting authority would have used to award a contract, the aggrieved tenderer’s bid is scrutinized in terms of validity. This means scrutiny of a more formal type as to whether in theory, without evaluation, for example, all required documents were contained or, when specific requirements were set, whether these were met. In the second instance, the quality is assessed under the standard of the tender documentation; where any external or expressly stated criteria are used, this amounts to an assessment of the objective quality of a bid. Another type of assessment which is often performed by the courts is one of relative quality. This implies an evaluation of a bid in comparison to bids submitted by other tenderers and involves a hierarchy of tenders.
(4) Theoretical acceptability and possibility to refuse (declare a bid offer to be unfruitful) On the classification of the existence and seriousness of a chance, the courts are open to the argument that even if the aggrieved bidder is the only remaining candidate, if the final bid and the confirmed estimation are very far apart, even more than double, that a bid is unacceptable:
« que dans ces conditions, compte tenu de l'importance de l'écart qui subsistait, après
négociation, entre l'offre de la société requérante et l'estimation du marché, dont il ne
résulte pas de l'instruction qu'elle aurait été irréaliste, de la possibilité toujours ouverte à la RATP de déclarer, ainsi qu'elle le fait valoir, la consultation infructueuse en l'absence
d'offre acceptable, et alors même que la société requérante était la seule à
présenter une candidature recevable» [emphasis added]364
This judgment is a rather recent one, and the argumentation – although entirely plausible in terms of the freedom to contract logic – opens up a new solid line of defense for contracting authorities, as it will in most cases be impossible to prove that negotiations would indeed have been fruitful.365 At the same time, the abovementioned case is isolated and generally
strong presumptions in favor of the acceptability of a bid are being made – the fact that an offer lay 3% below the contracting authorities’ price estimation, for example, resulted in
364 CAA Paris, 8 March 2011, SOCIETE ETABLISSEMENTS CARRE.
365 Under German law, this line of argumentation is perfectly common and acceptable, but the case law has
already developed further, the rebuttal being that the will to contract is proven if the contract has actually been awarded or if an economically identical one has been retendered. To the author’s best knowledge, these considerations are not yet common in French litigation.
156
establishing a serious chance because it was therefore not established that the price “aurait
fait obstacle à ce que son offre puisse être retenue” 366.