Mansfield District Council v Secretary of State for Communities and Local Government
2014
ADMINISTRATIVE COURT
UK
CORAM
- MR JUSTICE FOSKETT
Areas of Law
- Contract Law
- Public International Law
- Commercial Law
2014
ADMINISTRATIVE COURT
UK
CORAM
AI Generated Summary
The case involved the clawback of grants from the European Regional Development Fund by the Defendant from the Claimant due to purported breaches in the awarding of contracts without public advertising. The court found that the Claimant did not comply with EU procurement requirements or the Deeds of Grant due to lack of proper advertising and an assessment of cross-border interest. The clawback of 25% of the grant was considered proportionate.
Judgment
MR JUSTICE FOSKETT:
Introduction
By a letter dated 19 March 2013 the Defendant (acting through the East Midlands Growth Delivery Team) communicated his decision to the Claimant to claw back from the Claimant grant payments made previously from the European Regional Development Fund (‘ERDF’) towards the funding of a town centre improvement plan. The amounts sought to be clawed back were £138,317.74 and £20,262.52 in respect of two contracts awarded by the Claimant to A & S Enterprises in connection with the town centre improvement plan.
The Defendant’s justification for the claw-back is (i) that the Claimant had, it was suggested, breached EU law in the award of the two contracts (by failing to advertise publicly the proposed contracts), (ii) that it was, accordingly, also in breach of contract with the Defendant and (iii) that the amount of the claw-back (25% of the total sums made available by way of grant) was proportionate.
The Claimant refutes the basis of the Defendant’s case and his entitlement to act in the manner indicated.
The contracts and the essential legal parameters
The two projects the subject of the two contracts were the Mansfield Station Gateway Office Accommodation Project (“the GOA Project”) – which would create 434 m² of office accommodation - and the Mansfield Woodhouse Station Gateway Public Realm Improvement Works (“the PRIW Project”). Those latter works were in the nature of landscaping. The purpose of the two projects was said to be “to provide a positive, safe and attractive gateway to Mansfield Woodhouse for passengers arriving by train.” They provided office accommodation and associated minor public works in the curtilage of Mansfield Woodhouse station.
In the scale of things, they were not substantial projects and indeed they fell below the threshold of the Public Contracts Regulations 2006 , but nonetheless the contracts relating to them were subject to “EU Procurement Requirements” in the manner to which I will refer below. The overall value of the two contracts awarded was a little over £900,000 whereas the threshold for works contracts under those regulations was just over £3.9 million.
Prior to 1 November 2011 the ERDF was administered by the East Midlands Development Agency (the ‘EMDA’), one of the Regional Development Agencies then in existence. Accordingly, it was the EMDA that was engaged in the process of agreeing the grants for the two contracts. That engagement provides much of the bedrock to the