Covanta Energy Ltd v Merseyside Waste Disposal Authority

Covanta Energy Ltd v Merseyside Waste Disposal Authority

The amended Public Contracts Regulations 2006, including automatic suspension provisions, do not apply to procurement procedures commenced before 20 December 2009 due to clear transitional provisions. However, applying the American Cyanamid principles, damages would not be an adequate remedy for Covanta due to the complexity and speculative nature of loss assessment. The balance of convenience, considering public interest, adequacy of damages, and modest delay relative to the contract's duration, favours granting an interim injunction restraining MWDA from entering into the contract with SITA until trial.

Parties
Claimant: Covanta Energy Ltd; Defendant: Merseyside Waste Disposal Authority
Jurisdiction
England and Wales
Judgment Date
26 September 2013
Procedural Posture
Judicial Review / Procurement Challenge / Interim Injunction Application
Outcome
Interim injunction granted
Legal Topics
Interim Injunctions, Competitive Dialogue Procedure, Remedies for Unlawful Procurement, Adequacy of Damages, Balance of Convenience
Public Procurement Contract Law Administrative Law Interim Injunctions Competitive Dialogue Procedure Remedies for Unlawful Procurement Adequacy of Damages Balance of Convenience

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Parties

Covanta Energy Ltd

Claimant

Merseyside Waste Disposal Authority

Defendant

Procedural Posture

Judicial Review / Procurement Challenge / Interim Injunction Application

Legal Issues

  1. 1 Whether the amended Public Contracts Regulations 2006 (including automatic suspension provisions) apply to a procurement process commenced before 20 December 2009
  2. 2 Whether an interim injunction should be granted restraining MWDA from entering into the contract with SITA until trial
  3. 3 Adequacy of damages as a remedy for Covanta

Ratio Decidendi

The amended Public Contracts Regulations 2006, including automatic suspension provisions, do not apply to procurement procedures commenced before 20 December 2009 due to clear transitional provisions. However, applying the American Cyanamid principles, damages would not be an adequate remedy for Covanta due to the complexity and speculative nature of loss assessment. The balance of convenience, considering public interest, adequacy of damages, and modest delay relative to the contract's duration, favours granting an interim injunction restraining MWDA from entering into the contract with SITA until trial.

Court Disposition

Interim injunction granted

Orders

  • MWDA restrained from entering into the Resource Recovery Contract with SITA until conclusion of the trial or further order
  • Covanta to provide guarantee in respect of cross-undertaking in damages