Access to justice – Disability equality duty – Mental health – Tender process

Public Interest Lawyers v Legal Services Commission: QBD (Admin) (Mr Justice Cranston): 13 December 2010

The claimant firms of solicitors (P) challenged decisions of the defendant Legal Services Commission in respect of the award of contracts for the ­provision of publicly funded legal services in public law and mental health.

P were firms that had held contracts with the commission to provide publicly funded legal services in public law and mental health law. Following a consultation process, the commission conducted a tender to allocate such contracts once the existing contracts expired. The contract specification required firms to employ people meeting specified supervisors’ standards. Supervisors’ self-certification forms, completed for the commission’s verification process, did not require supervisors to demonstrate that they met the criteria. The effect of the tender substantially reduced the new matter starts allocated to firms that had worked in public law and mental health under the previous contracts, including firms that had held contracts relating to high-security hospitals.

P argued that the commission had (1) breached the equality standard demanded by Directive 2004/18, which had been implemented by the Public Contracts Regulations 2006, by failing to verify the quality standards of the contracting firms; (2) failed to comply with the general disability equality duty in section 49A of the Disability Discrimination Act 1995 in respect of mental health contracts relating to high-security hospitals, by failing to assess the impact on patients who might no longer be able to instruct their existing solicitors; (3) breached its duty under section 4 of the Access to Justice Act 1999 because the outcome of the public law tender had been that clients’ access to the most experienced firms had been reduced because of the substantial reduction of new matter starts awarded to them.

Held: (1) The verification of quality standards had been flawed; in particular, the process had not allowed the commission to verify that firms met the criteria in relation to the employment of appropriate supervisors, as the self-certification form did not require supervisors to confirm specifically the nature of the employment arrangement between them and the organisation or whether they had complied with the requisite supervision standards. Because the verification process had fallen short, organisations might have gained contracts despite not meeting the supervision criteria. The equality standard in the Directive and the Regulations had therefore been breached, Evn AG v Austria (C-448/01) [2003] ECR I-14527 ECJ (6th Chamber) applied. To ensure that unfairness caused to successful tenderers who did meet the relevant criteria was remedied, the commission was to ensure, within a limited period, that all firms holding contracts in public law and mental health complied with the supervision standards. Those found not to comply would have to have their contracts removed and any new matter starts would have to be redistributed to those firms meeting the requirements (see paragraphs 65-66 and 87 of judgment).

(2) The commission had had due regard to the position of patients in high-security hospitals in striking the balance between continuity of advice and quality of advice in favour of improving quality. There could be no challenge under the general disability equality duty to the tender process; however, the duty had become engaged because of the outcome of the tender. The outcome was that all the patients were assured a high-quality service, but many of them needed to switch advisers, which might have had an adverse impact on those already vulnerable. Accordingly, the commission had to have due regard to whether it needed to take steps to ameliorate that result of the tender (paragraphs 76-77 and 88).

(3) The commission had not breached its duty under section 4 of the 1999 act. The outcome of the public law tender had been that specialist firms were no longer able to open the advice cases they had under the previous contract. That did not preclude them from undertaking publicly funded litigation under certificate. Whatever view was taken of that outcome, there had been no legal flaw in the way the commission had conducted the tender: it had conducted an extensive consultation exercise and had sufficiently inquired about the potential impact on clients (paragraphs 86 and 89).

Judgment for claimants in part.

Paul Bowen (instructed by Bindmans) for the claimants; Paul Nicholls (instructed by the in-house solicitor) for the defendant.