“Reassuringly Expensive?”

Blog author: Christopher Miers, Probyn Miers

You may remember an advertising campaign which captured the slogan “reassuringly expensive”, along with a series of short films such as ‘Jacques de Florette’ (think French countryside, bouquets of flowers, and … cold beer), suggestive of the idea that price was not the only factor to consider when buying a product, and that a higher price may be an indicator of a higher quality (in this case, of beer). Deciding on your choice of beer, or any other product, is a matter which brings in to play individual preferences and interests. A construction project introduces a far more complex evaluation for decision making on
procurement, but as with the “reassuringly expensive” campaign, it still requires an evaluation of the client preferences and interests which are unique to that project. The evaluation will drive the procurement strategy and cover high level strategic issues such as selection of owner or contractor design responsibilities and the form of contract, early contractor involvement, and two-stage or single-stage tendering, through to the required level of advancement of design for tender purposes, defining specialist design packages, and the timing of issue and return of tenders and dealing with tender
clarifications, amongst other matters. Tendering remains a key part of successful project procurement. Disputes are common arising from tender documentation, tender clarifications, and questions (principally on design-construct projects) as to whether the tender period and process was adequate for a tendering contractor reasonably to assess and price project risk, and in particular whether the tender period and process was adequate to allow tenderers to detect unknown conflicts within the Employer’s Requirements.

The annual review by Arcadis in their Global Construction Disputes Report for 2017, reports that, as with previous years, two of the top five causes of construction disputes relate to tender stage issues: errors or omissions in the contract documents; and incomplete design information or employer’s
requirements for Design and Build and D&C¹. JCT has recently updated its Practice Note on Tendering, which is now published as ‘Tendering 2017 – Practice Note’ (“the updated/2017 Practice Note”). It was previously last updated in 2012, and I wrote at the time² of a high profile public project where the tendering process went awry, on Portcullis House in London³.

It is good to r emember that JCT reflects a consensus across the construction industry, with representatives from public and private sector, consultants, contractors and subcontractors all present and with involvement in the drafting of contracts and guidance. We can read the Practice Note in that context.

The updated Practice Note is intended for use by both the public and private sectors. Public sector procurement is subject to the Public Contracts Regulations 2015, introduced since the previous JCT Practice Note, to replace the 2006 Public Contracts Regulations. In relation to the public sector, the 2017 Practice Note indicates some of the key areas where EU public procurement rules impact on aspects of tendering procedure. However the Practice Note does not seek to be a guide to every aspect of these latest regulations, and the commentary on aspects of tendering is stated to apply to private sector procurement unless specifically referenced in the document to the public sector.

JCT and its drafting team have provided a structured approach through three stages in relation to tendering:

  • the Preliminary Enquiry;
  • the Invitation to Tender and Tender; and
  • the assessment and award.

The Practice Note provides “Model Forms” for the Preliminary Enquiry and the Invitation to Tender and Form of Tender, as well as comprehensive notes of guidance. The Preliminary Enquiry model form provides a helpfully structured pro forma, with a model form of enquiry letter, a project information schedule and – particularly importantly – a questionnaire checklist for specific project adaptation. The Practice Note gives guidance as to how this preliminary enquiry should be made, a reasonable timing for responses, and notes on the use of the questionnaire. Crossreference is made also to relevant British Standards which will assist further by way of checking for compliance with good practice. The model form of Invitation to Tender and model form of Tender also are set out, in a standard format ready for adaptation to the specific project. These helpfully ensure that key matters are addressed, such as the method for managing the discovery of errors in pricing or errors in arithmetic before acceptance of the offer.

Assessment and award is covered, including post-tender discussions (keep in mind my mention above of the Portcullis House tender) and, for public sector contracts, a reminder of the post-tender ‘Standstill Period’, and cross-referencing to the specific information required for the notice of decision to award a contract or conclude a framework agreement. It is my view that construction consultants and contractors preparing tenders and responding to tender enquiries will be well advised to take a fresh look at this latest 2017 Tendering Practice Note, and to crosscheck standard procedures already in place against this latest guidance. At least, if then the tenders returned are “reassuringly expensive”, you will be satisfied that you comply with best practice and that the procedure provides a proper basis for moving the project forward to the construction phase.


¹ https://www.arcadis.com/en/united-states/our-perspectives/global-construction-disputes-report-avoiding-the-same-pitfalls/
² Review in conjunction with Bart Kavanagh in JCT News, February 2013.
³ Harmon CFEM Facades (UK) Ltd v The Corporate Officer of the House of Commons [1999] EWHC Tech 199